Document:

Bonanza Oil & Gas Inc.: Exhibit 10.17 - Filed by newsfilecorp.com

Blacksands Petroleum Texas, LLC

	CORPORATE HQ 	O&G OPERATIONS 
	25025 I-45N, Suite 410 	800 Bering, Suite 250 
	The Woodlands, Texas 77380 	Houston, Texas 77057 
	832.978.6752 	713.554.4491 
	Fax no.
      281.298.6001 	Fax
      no. 713.583.1617 

August 10, 2010 

Via Facsimile 
BWiseman@Bonanzaog. com 

Mr. Bill Wiseman, President/CEO 
Bonanza Oil & Gas Inc.

3417 Mercer, Suite E.

  Houston, TX 77027 

	RE: 	Purchase and Sale and Exploration
      Agreement 
	  	Apclark Field (Jackson Well No. 1
      and Everett Well No. 7-1H) 
	  	1257 acres of land, more or less,
      being out of 
	  	BLK 31, T4N, TNP RRC 
	  	Borden County, Texas
  

Dear Gentlemen, 

This Purchase and Sale and Exploration Agreement (the
“Agreement ”), when accepted in the manner hereinafter set forth, shall
evidence an agreement among Blacksands Petroleum -Texas,
LLC hereinafter referred to as “BSPE” and Bonanza Oil &
Gas, Inc’s hereinafter referred to as “Bonanza ” with respect to the
Westerly Exploration, Inc. operated Jackson Well No. 1 and Everett Well No. 7-1H
(“the Wells”) and 1257 acres of land held by production thereby, being
more particularly described on Exhibit “A”, (“the Lands”),
subject to the following general terms and conditions. BSPE and
Bonanza are sometimes hereinafter collectively referred to as the
“Parties”. 

Now therefore for and in, consideration of the
mutual covenants expressed herein the Parties agree to the following;

1

ARTICLE I 

  ACQUISITION OF THE WELLS

	I. 	
      BSPE agrees to deliver $325,000.00
      (“Acquisition Well Costs”) to Bonanza, to be paid upon the
      acceptance and execution of and by the Parties of the Agreement
      and the Assignment and Bill of Sale of Wells. Such payment is
      for all of Bonanza’s right, title and interest in and to the
      production from the Wells. Bonanza hereby represents that
      its interest in and to the Wells is 25% gross leasehold working
      interest with an 18.75% of 8/8ths net revenue interest associated
      therewith.

	 	 
	II. 	
      Concurrently, with the payment of the Acquisition Well
      Costs set out in I. above, Bonanza agrees to execute the
      assignment attached hereto as Exhibit “B” (“Assignment and Bill
      of Sale of Wells”). The Assignment and Bill of Sale of Wells is
      effective the first day of August 2010.

ARTICLE II 

  LEASEHOLD ACQUISITION

	I. 	
      BSPE agrees to deliver $135,000.00
      (“Acquisition Leasehold Costs”) to Bonanza, to be paid upon
      the acceptance and execution of and by the Parties of the
      Agreement and the Partial Assignment of Oil, Gas and Mineral
      Leases, as consideration for an unencumbered assignment from
      Bonanza of an 18.875% gross working interest with a 14.15625% of
      8/8ths net revenue interest, attributable thereto in the Lands. The
      effective date of the Assignment is August 1, 2010.

	 	 
	II. 	
      Concurrently, with the payment of the Acquisition
      Leasehold Costs set out in I. above, Bonanza agrees to execute
      the assignment attached hereto as Exhibit “C” (“Partial
      Assignment of Oil, Gas and Mineral Leases”). The effective date of the
      Partial Assignment of Oil, Gas and Mineral Leases is the first day
      of August 2010.

ARTICLE III 

  EXPLORATION

	I. 	
      BSPE agrees to carry Bonanza for 2.5% gross
      leasehold working interest (1.875% net revenue interest) in and to the
      first well drilled on the Lands (“Test Well”) to the
      “Sales Point”. To the Sales Point shall be defined as all
      costs associated with location, drilling, testing, and completing the
      well, including, if applicable, hydraulic fracturing or other stimulation
      process, tanks, facilities and flowlines, and other costs associated
      therewith prior to turning the well to sales (“Carry Point”). All
      costs and expenses or other obligations associated with Bonanza’s
      2.5% gross leasehold working interest after the Carry Point
      shall be the responsibility and liability of Bonanza. However,
      not withstanding the provisions herein, in the event the total drilling
      and completion well costs to Sales Point exceeds $1.6MM to the
      8/8ths prior to reaching the Carry Point, BSPE shall have no
      obligation or responsibility to pay Bonanza’s pro-rata share of the
      costs exceeding $1.6MM. All costs and expenses over the $1.6MM shall be
      22.5% BSPE and 2.5% Bonanza.

	 	 
		
      At Carry Point the interest of the Parties
      shall be;

*ACP                       
ACP 

2

	ENTITY 	GWI 	 	NRI 
	BSPE 	22.50% 	 	16.875% 
	Bonanza 	2.50% 	 	 1.875% 
	  	25.00% 	 	18.750%

* After Carry Point 

	II. 	
      In addition, BSPE agrees to deliver to Bonanza
      a 3.75% gross leasehold working interest (with a 2.8125% net revenue
      associated therewith) Back-in at 100% Payout on the Test Well
      drilled on the Lands. As used herein, the term “Payout”
      shall be based on a well basis, and shall be effective on the first day of
      the month following the month in which payout occurs. Payout is
      defined as and shall mean that point in time when 100% of (i) all of
      BSPE costs and expenses associated with the Test Well,
      including but not limited to BSPE’s leasehold acquisition costs,
      and (ii) the costs of drilling, completing, testing, stimulating,
      equipping and operating the Test well, after all ad valorem taxes,
      production taxes, and all leasehold burdens have been deducted/recouped
      from production therefrom. Any recompletion, reworking, including but not
      limited to rod jobs, motor replacements testing and stimulation or
      plugging back operation conducted on the Test Well therefore,
      prior to Payout, shall be deemed as part of the costs of
      operation of such Test Well and the costs for same shall be added
      to the monies to be recouped until Payout occurs and one hundred
      percent (100%) of the costs of such recompletion, reworking, or plugging
      back operation have been recouped.

	 	 
		
      At payout the interest of the Parties shall
    be;

	  	*APO 	 	APO 
	ENTITY 	GWI 	 	NRI 
	  	  	 	  
	BSPE 	18.75% 	 	14.0625% 
	  	  	 	  
	Bonanza 	6.25% 	 	4.6875% 
	  	25.00% 	 	18.7500% 

* After Payout 

Within 30 days after Payout, BSPE agrees to
deliver to Bonanza an unencumbered Partial Assignment of Wellbore
representing Bonanza’s additional 3.5% working interest
(2.8125% net revenue interest) in and to the Test Well. 

3

ARTICLE IV 

  SUBSEQUENT OPERATIONS AND DRILL WELLS
  

The interest of the Parties in all subsequent and additional
  test wells shall be as follows; 

	  	APO 	 	APO 
	ENTITY 	GWI 	 	NRI 
	  	  	 	  
	BSPE 	18.75% 	 	14.0625% 
	  	  	 	  
	Bonanza 	6.25% 	 	4.6875% 
	  	25.00% 	 	18.7500% 

All proposed subsequent wells and procedures shall be in
accordance of the controlling Joint Operating Agreement.

ARTICLE V 

  CONFIDENTIAL 

This Agreement and the contents are intended to be
confidential and are not to be discussed with or disclosed to any third party,
except as may be required by law. Any information, including but not limited to
financial, land, geological, engineering and production data made available to
either of the Parties pertaining to the Wells and
/or the Land or this Agreement will be held in strictest
confidence (except such information that is available to the public).

ARTICLE VI 

  ENTIRE AGREEMENT 

This Agreement (including the Exhibits attached hereto)
constitutes the entire understanding , Wells between the Parties
with respect to the Lands and the superseding all negotiations,
prior discussions and prior agreements and understandings relating to the
Lands and the Wells . This Agreement may be supplemented,
altered, amended, modified or revoked in writing only, signed by the
Parties hereto. 

4

ARTICLE VII 

BINDING EFFECT 

This Agreement shall constitute a binding and
enforceable agreement between the Parties and shall inure to the benefit
of the Parties hereto and their respective successors and assigns. 

ARTICLE VIII 

  INTERPRETATION

     This Agreement shall be
interpreted and construed in accordance with the laws of the State of Texas,
without regard to conflicts of laws principles thereof, and shall be binding
upon and inure to the benefit of the Parties hereto and
their respective heirs, personal representatives, successors, and assigns, and
shall supersede all prior oral and written agreements between the Parties
in connection with the subject matter thereof.

ARTICLE IX 

  LIABILITIES 

The liabilities of the Parties hereto shall be several
and not joint or collective. 

ARTICLE X 

  TERMINATION

In the event this Agreement is not executed by the
Parties hereto on or before the 13th day of August 2010 at
5pm, this Agreement shall expire and be considered null and void and for
all purposes being deemed as never having been in force or effect.

5

ARTICLE XI 

  ASSIGNABILITY 

No transfer of a Party’s rights or obligations under
this Agreement shall be effective as to the other Parties or to
the respective transferee, unless and until such prospective transferee shall
have first (a) been, Agreement furnished with a copy of
this together with all exhibits hereto, and (b) agreed in writing to assume,
observe and perform its proportionate part of all the terms, provisions,
covenants,, Agreement conditions and obligations contained in this and
(c) prior to said assignment, said Party making such transfer is current
on all bills to date as outlined herein and in accordance . JOA with the

ARTICLE XII

  HEADINGS

The article and paragraph Agreement . headings used in
this Agreement are inserted for convenience only and shall not be
regarded in construing this 

ARTICLE XIII 

  TAXATION

This Agreement is not intended to create, and shall not
be construed to create, a relationship, a partnership, or an association for
profit between or among the Parties hereto. Notwithstanding any
provisions herein that the rights and liabilities hereunder are several and not
joint or collective, or that this Agreement and operations hereunder shall not
constitute a partnership, of for Federal Income tax purposes, this Agreement and
the operations hereunder are regarded as a partnership, each Party
hereby affected elects to be excluded from the application of all of the
provisions of Subchapter “K”, Chapter 1, Subtitle “A”, of the Internal Revenue
Code of 1986, as permitted and authorized by Section 761 of the Code and the
regulations promulgated thereunder. Any operator designated under the terms of
this Agreement is authorized and directed to execute on behalf of each
Party hereby affected such evidence of this election as may be required
by the Secretary of the Treasury of the United States or the Federal Internal
Revenue Service, including specifically, but not by way of limitation, all of
the returns, statements, and the data required by Federal Regulations 1.761
-(2). Should there by any requirement that each Party hereby affected
give further evidence of this election, each such Party shall
execute such documents and furnish such other evidence as may be required by the
Federal Internal Revenue Service or as may be necessary to evidence this
election. No Party shall give any notices or take any other action
inconsistent with the election made thereby. If any present or future income tax
laws of the State in which the Contract Area is located or any future income tax
laws of the United States contain provisions similar to those in Subchapter “K”,
Chapter 1, Subtitle “A”, of the Internal Revenue Code of 1986, under which an
election similar to that provided by Section 761 of the Code is permitted, each
Party hereby affected shall make such election as may be permitted or
required by such laws. In making the foregoing election, each such Party
states that the income derived by such Party from operations hereunder
can be adequately determined without the computation of partnership taxable
income. 

ARTICLE XIV

  MULTIPLE COUNTERPARTS

This Agreement may be executed in multiple
counterparts, each of which shall be an original but all of which together shall
constitute one and the same instrument. 

6

ARTICLE XV

  LIENS 

	 	1. 	
      Bonanza represents that it has paid all
      outstanding invoices to the operator (Westerly) associated with
      the Lands and the Wells up to the Effective Date. In
      addition, Bonanza represents that there are no liens and/or
      encumbrances affecting the Lands and/or the
  Wells.

This Agreement is specifically subject to Bonanza having
written and recordable instruments releasing the liens/encumbrances on and to
the Lands and the Wells.

The provisions of this Agreement shall constitute
covenants running with the land. 

IN WITNESS WHEREOF, this instrument is
executed effective as of the date first day of August 2010 (“Effective
Date”).

Blacksands Petroleum
  -Texas, LLC 

/s/ David
DeMarco                                            
 

Name: David DeMarco 
Title: CEO

Date: August 13, 2010 

Bonanza Oil and Gas 

/s/ Bill
Wiseman                                                          
 
Name: Bill Wiseman 
Title: President
Date: August 13, 2010

7

EXHIBIT “A” 
LEGAL DESCRIPTION 

Borden County, Texas 

	 	 	Instrument 	 	 	 
	Lessor 	Lessee 	Type 	Legal Description 	Lease Date 	Volume/Page 
	 Murray Anne Andersen 	Charles
      Weiner 	Lease 	Sec. 8-Blk 31, T4N & W/2 Sec. 46 Blk-31-T5N-T&P Ry
      Co Sy 	1/16/2006 	296/638 
	 Marie Jackson Dunkinson 	Charles
      Weiner 	Lease 	Sec. 8-Blk 31, T4N
      & W/2 Sec. 46 Blk-31-T5N-T&P Ry Co Sy 	1/16/2006 	296/6335 
	 Buena Jackson Shultz 	Charles
      Weiner 	Lease 	Sec. 8-Blk 31, T4N & W/2 Sec. 46 Blk-31-T5N-T&P Ry
      Co Sy 	1/16/2006 	296/632 
	 Catherine Tanner 	Charles
      Weiner 	Lease 	Sec. 8-Blk 31, T4N
      & W/2 Sec. 46 Blk-31-T5N-T&P Ry Co Sy 	1/16/2006 	296/828 
	 Curtiss Jackson 	Charles
      Weiner 	Lease 	Sec. 8-Blk 31, T4N & W/2 Sec. 46 Blk-31-T5N-T&P Ry
      Co Sy 	1/16/2006 	296/825 
	 Don Jackson 	Charles
      Weiner 	Lease 	Sec. 8-Blk 31, T4N
      & W/2 Sec. 46 Blk-31-T5N-T&P Ry Co Sy 	1/16/2006 	296/822 
	 Wendy Ann Perry 	Charles
      Weiner 	Lease 	Sec. 8-Blk 31, T4N & W/2 Sec. 46 Blk-31-T5N-T&P Ry
      Co Sy 	12/13/2005 	296/654 
	 R.M. Livestock Ltd., W.D. (Dewey) Everett Tr 	Charles
      Weiner 	Lease 	Sec. 17;18; N/2,
      SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	3/7/2006 	296/641 
	 R.M. Livestock Ltd., W.D. (Dewey)
      Everett Tr 	Charles
      Weiner 	Extension 	Sec. 17;18; N/2, SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	3/1/2009 	309/144 
	 R.M. Livestock Ltd., W.D. (Dewey) Everett Tr 	Charles
      Weiner 	Amendment 	Sec. 17;18; N/2,
      SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	2/21/2008 	304726 
	 Belinda K. Johnson 	Charles
      Weiner 	Lease 	Sec. 17;18; N/2, SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	3/7/2006 	296/628 
	 Belinda K. Johnson 	Charles
      Weiner 	Amendment 	Sec. 17;18; N/2,
      SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	9/7/2008 	306697 
	 Vanette Everett 	Charles
      Weiner 	Lease 	Sec. 17;18; N/2, SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	3/7/2006 	296/624 
	 Vanette Everett 	Charles
      Weiner 	Amendment 	Sec. 17;18; N/2,
      SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	2/21/2008 	306/699 
	 Jimmy Don Everett 	Charles
      Weiner 	Lease 	Sec. 17;18; N/2, SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	3/7/2006 	296/620 

8

	Jimmy Don Everett 	Charles
      Weiner 	 Amendment 	 Sec. 17;18; N/2, SE/4 Sec.7-Blk 31-T4N-T&P Ry Co Sy 	 2/21/2008 	 306/701 
	Florence Marie Hall Trust, by Bank of America, N.A. Trustee 	Charles
      Weiner 	Memorandum 	SE/4 Sec. 7, N 400
      acres Sec. 17 and all of Sec. 18 & 19 Blk 31-T4N-T&P Ry Co. Survey 	1/16/2008 	304/733 
	 American National Insurance Company 	Charles
      Weiner 	 Lease 	 Sec 45: 157.71 acs (NE/4) - Blk 31 - T5N - T&P Ry 		

9

EXHIBIT “B” 

ASSIGNMENT
AND BILL OF SALE OF WELLS 

	STATE OF TEXAS 	§	 
	  	 	KNOW ALL MEN BY THESE
      PRESENTS: 
	COUNTY OF BORDEN 	§	 

          That,
Bonanza Oil & Gas, Inc. a ________ Corporation, whose address is 3417
Mercer, Suite E., Houston, Texas 77027 (“Assignor”) in consideration of
the sum of Ten Dollars ($10.00) and other valuable consideration, the receipt,
adequacy and sufficiency of which are hereby acknowledged, subject to the
reservations hereinafter set out, does hereby assign, transfer, convey, sell and
deliver unto Blacksands Petroleum Texas, LLC, a Texas corporation, whose
address is 800 Bering, Suite 250 Houston, Texas 77057 (“Assignor”), its
successors and assigns, a 25% leasehold working interest with a 18.75% of 8/8ths
net revenue interest associated therewith (“the Interest”) in and to the
Jackson Well No. I and Everett Well No. 7-1H (“the Wells”) located on the
Oil, Gas and Mineral Leases and amendments thereto and extensions thereof
(hereinafter called “Said Leases”) situated in Borden County, Texas, and
more fully described on Exhibit “A”, attached hereto and made a part
hereof for all purposes, together with all of Assignor’s share of
production, if any, from the Wells and like interest in all personal
property, fixtures and equipment including but not limited to the Wells,
Surface Facilities, Pipelines, Flowlines and all other equipment and personal
properties located on and used or obtained in connection therewith. 

          This
  Assignment and Bill of Sale of Wells is subject to; 

	 	(i) 	
      The terms and provisions of the Notice of Operating
      Agreement between Westerly and Lucas recorded in Book 0301, Page 682 of
      the records of Borden County, Texas; and

	 	(ii) 	
      The Purchase and Sale and Exploration Agreement dated
      August 5, 2010 between Blacksands Petroleum-Texas, Inc. and Bonanza Oil
      and Gas, Inc; and

	 	(iii) 	
      That certain Assignment and Bill of Sale made effective
      the 5th day of February 2008 by and between Lucan Energy, Inc.
      as Assignor and Bonanza Oil and Gas, Inc. as Assignee, recorded in Volume
      0303, Page 786 in the Official Records in Borden County, Texas;
  and

	 	(iv) 	
      

	 	(v) 	
      All applicable rules, regulations or laws of the state or
      federal agency or body having jurisdiction over Said Leases and
      the Wells.

          Assignor,
its successor and assigns, for the same consideration, does hereby agree to
WARRANT and DEFEND the Interest therein assigned unto said
Assignees, their successors, legal representatives and assigns, against
the lawful claims and demands of all persons whomsoever claiming or to claim the
same or any part thereof, by, through or under Assignor, and no further.

          This
Assignment and Bill of Sale of Wells may be executed in several
counterparts, each of which when so executed shall be deemed an original and all
such counterparts when taken together, shall constitute one and the same
instrument. For recordation purposes, the separate signature pages and acknowledgements may be affixed to the body
of the original instrument without the necessity of recording each separate
counterpart in its entirety. 

10

          IN
WITNESS WHEREOF, Assignor has executed this instrument on this ____ day
of August, 2010, to be effective August 1, 2010. 

ASSIGNOR: 

BONANZA OIL AND GAS, INC. 

By:
___________________________________
         
Bill Wiseman, president 

ASSIGNEE: 

BLACKSANDS PETROLEUM-TEXAS, INC.

By: ____________________________________

           David V. DeMarco,
CEO 

ACKNOWLEDGMENTS 

	STATE OF TEXAS 	§ 	 
	  	§ 	 
	COUNTY OF HARRIS 	§ 	 

          This
instrument was acknowledged before me on the ___ day of __________, 2010, by Bill
Wiseman as president, of Bonanza Oil and Gas, Inc. a __________ corporation, on
behalf of said corporation. 

          I
have hereunto set my hand and official seal this ___ day of __________, 2010. 

Notary Public, State of Texas 

	STATE OF TEXAS 	§ 	 
	  	§ 	 
	COUNTY OF HARRIS 	§ 	 

This instrument was acknowledged before me on the ___ day of
__________, 2010, by David DeMarco as chief executive officer, of Blacksands
Petroleum-Texas, LLC, a Texas Limited Liability Corporation, on behalf of said
corporation. 

          I
have hereunto set my hand and official seal this ___ day of __________, 2010. 

Notary Public, State of
___________

11

EXHIBIT “C” 

PARTIAL ASSIGNMENT OF OIL, GAS AND MINERAL LEASES 

	STATE OF TEXAS 	§ 	  
	  	§ 	KNOW ALL MEN BY THESE
      PRESENTS: 
	COUNTY OF BORDEN 	§ 	  

          THAT,
BONANZA OIL AND GAS, INC. a _______corporation, whose address is 3417
Mercer, Suite E., Houston, Texas 77027 (hereinafter referred to as
“Assignor”), for and in consideration of Ten Dollars ($10.00) and other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, does herby bargain, sell, transfer, assign and convey unto
BLACKSANDS PETROLEUM-TEXAS, LLC, a Texas Corporation whose address is 800
Bering, Suite 250, Houston, Texas 77057 (hereinafter referred to as
“Assignee”), 18.75% leasehold working interest with a 14.0625% net
revenue interest attributable thereto (“the Interest”) in and to those
Oil, Gas and Mineral Leases, described in Exhibit “A” (“the Leases”),
attached hereto and made a part hereof for all purposes. 

          Partial
Assignment of Oil, Gas and Mineral Leases is made subject to the terms and
provisions contained in the Leases, and further subject to the
following;

	 	1.)	
      That certain Assignment and Bill of Sale made effective
      the 5th day of February 2008 by and between Lucan Energy, Inc.
      as Assignor and Bonanza Oil and Gas, Inc. as Assignee, recorded in Volume
      0303, Page 786 in the Official Records in Borden County, Texas;
  and

	 	2.)	
      The terms and provisions of the Notice of Operating
      Agreement between Westerly and Lucas recorded in Book 0301, Page 682 of
      the records of Borden County, Texas; and

	 	3.)	
      The Purchase and Sale and Exploration Agreement dated
      August 5, 2010 between Blacksands Petroleum-Texas, Inc. and Bonanza Oil
      and Gas, Inc; and

	 	4.)	
      All applicable rules, regulations or laws of the state or
      federal agency or body having jurisdiction over the Leases and
      the Interests.

          Assignees
agree to obligate themselves to assume and discharge their proportionate shares
of the express or implied obligations and liabilities imposed upon the
Lessees under the terms and provisions of the Leases affected
hereby the same as though Assignees had originally been named a
Lessee in the Leases and agree to hold Assignor harmless
from its failure to do so, to the extent provided for herein. 

          TO
HAVE AND TO HOLD same unto Assignee, together with all and singular
rights and appurtenances thereto in any way belonging, unto Assignee, its
successors and assigns, forever and Assignor hereby binds itself, its
heirs, successors and assigns, to warrant and forever defend all and singular
rights in the Leases and the Interest unto Assignee, its
successors and assigns, against every person whomsoever lawfully claiming or to
claim the same or any part thereof, by, through and under Assignor, but
not otherwise. 

12

          IN
WITNESS HERE OF, this instrument is executed and made effective this 1st day of
August, 2010. 

ASSIGNOR: 

BONANZA OIL AND GAS, INC. 

___________________________
Bill
Wiseman, president 

ASSIGNEE: 

BLACKSANDS PETROLEUM-TEXAS, LLC

___________________________
David De Marco, CEO 

STATE OF TEXAS 
COUNTY OF HARRIS 

          This
instrument was acknowledged before me on the ___day of _____________, 2010, by
Bill Wiseman, as president of Bonanza Oil and Gas, LLC, a Nevada Corporation, on
behalf of said Corporation. 

____________________________
Notary Public, State of Texas

STATE OF TEXAS 
COUNTY OF HARRIS 

          This
instrument was acknowledged before me on the ___day of _____________, 2010, by
David DeMarco, as chief executive officer of Blacksands Petroleum-Texas, LLC, a
Texas Limited Liability Corporation, on behalf of said Corporation. 

____________________________
Notary Public, State of Texas

13Exhibit 10.4

 

THE ESTEE LAUDER COMPANIES

 

RETIREMENT GROWTH ACCOUNT PLAN

 

 

As Amended and Restated

Generally Effective as of January 1,
2007

 

 

AMENDMENT AND RESTATEMENT OF 

THE ESTEE LAUDER COMPANIES

RETIREMENT GROWTH ACCOUNT PLAN

 

SECTION 1

 

NAME
AND CONSTRUCTION

 

1.1           Name of Plan.  This Plan shall be known as the “The Estee
Lauder Companies Retirement Growth Account Plan.”

 

1.2           Construction.  It is the intention of Estee Lauder that the
amended and restated Plan, and its attendant trust fund, will continue to meet
the requirements of ERISA and be qualified and exempt from taxes under Sections
401 and 501 of the Code.  Effective
January 1, 1996, the Plan also is intended to be a “multiple employer plan”
within the meaning of Section 413(c) of the Code.  The Plan is intended to be a defined benefit
plan for purposes of ERISA and the Code.

 

1.3           Effective Date.

 

(a)           This Amendment and Restatement of the Plan shall generally be effective
as of January 1, 2007; provided, however, that:

 

(i)            The provisions of Sections 2.12, 2.16, 5.2, 7.1(a), 7.3, 8.4(b), 8.4(c) and
15 (other than Section 15.5) shall be effective January 1, 1991.

 

(ii)           The provisions of Section 14.10 shall be effective December 12,
1994.

 

(iii)          The provisions of Sections 2.6, 2.10, 2.15, 2.19, 2.21, 15.5 and 16
shall be effective January 1, 1996.

 

(iv)          The provisions of Section 7.1(b) shall be effective
October 1, 1996, and prior to such date the terms and conditions of such Section are
governed by Section 6.1(b) of the Plan in effect on January 1,
1993.

 

(v)           The provisions of Sections 2.11 and 5.4 shall be effective January 1,
1997.

 

(vi)          The provisions of the last paragraph of Section 5.5 and Section 8.4(a) shall
be effective January 1, 1998.

 

(vii)         The provisions of Appendix A shall be effective January 1, 1999
(except that those provisions thereof which, by their terms, are not limited to
periods on and after that date, shall be effective January 1, 1991).

 

1

 

(viii)        The
changes to such other provisions of the Plan shall be effective as of such
dates as are set forth in such provisions.

 

(ix)           Other provisions of the Plan shall be effective as of such other earlier
or later dates as shall be necessary to comply with those changes in applicable
law which were effective prior to January 1, 2007.

 

(b)           The rights of any person who terminated employment or retired on or
before the effective date of any of the relevant provisions of this amendment
and restatement of the Plan, including his or her eligibility for benefits,
shall be determined solely under the terms of the Plan as in effect on the date
of his termination or retirement, unless such person is thereafter reemployed
(and, to the extent relevant, again becomes an Active Participant) on or after
the effective date of any such provision of amendment and restatement, in which
case such provision shall apply to such person.

 

2

 

SECTION 2

 

DEFINITIONS

 

2.1           “Accrued Benefit” means a monthly amount of retirement income determined
for a Participant as of a specified date, commencing on a Participant’s Normal
Retirement Date, and payable as a single life annuity.  The Accrued Benefit as of a specified date
equals the Participant’s Retirement Account divided by the applicable factor
from Appendix A.  For those who were
participants in the Prior Plans as of December 31, 1990 and satisfy the
applicable requirements set forth in Appendix B, the Accrued Benefit is the
greater of the accrued benefit described above or the accrued benefit
determined under the Prior Plans, as described in Section 5.5 hereof.

 

2.2           “Actuarial Equivalent” means, with respect to a Participant’s Accrued
Benefit, another annuity or benefit that commences at a different date and/or
is payable in a different form than the Accrued Benefit, but which has the same
present value as the Accrued Benefit, when measured on the basis of the
interest rate, mortality table and other factors specified in Appendix A as of
the date of commencement of payment of such annuity or benefit, as calculated
by or under the supervision of an actuary appointed by Estee Lauder or the
Fiduciary Committee, which actuary has been enrolled under Subtitle C of Title
III of ERISA.

 

2.3           “Approved Absence” means (a) any period of absence from work (other
than any such absence on account of a period of Disability), with the approval
or direction of the Employer, for up to 12 months and, provided said Employee
returns to work for the Employer at such time as the Employer may reasonably
require, the Approved Absence may exceed such 12-month period but will not be
in excess of 24 months, (b) any period of absence during which the
Employee was in military service with the armed forces (including Coast Guard
and Merchant Marine Service) if the Employee has reemployment rights under
applicable laws and complies with the requirements of the law as to
reemployment and is reemployed, and (c) any period of Disability, but
(except as provided in the last paragraph of Section 5.5) not to exceed twelve
months.  An Approved Absence will be
disregarded for the purpose of the Plan, and the Employee will be regarded as
in the service of the Employer during any period of an Approved Absence.

 

The Hours of Service credited during an Approved
Absence shall be those which would normally have been credited but for such
absence, or in any case in which the Employer is unable to determine such hours
normally credited, eight (8) Hours of Service per day.

 

2.4           “Average Final Compensation” means the highest average annual “compensation”
which is produced by averaging an Employee’s compensation for any five (5) consecutive
calendar years within the Employee’s Years of Credited Service.  For purposes of this Section only, “compensation”
means the straight time basic salary or wages paid to an Employee by the
Employer for his services during each calendar year, inclusive of salary
reduction contributions made by an Employer on behalf of the Employee under a “cash
or deferred arrangement” described in Section 401(k) of the Code and
pre-tax contributions made by the Employee under a “cafeteria plan” described
in Section 125 of the Code and (effective 

 

3

 

January 1, 2001) under an arrangement
described in Section 132(f)(4) of the Code, in each case maintained
by an Employer, but excluding bonuses, payments for overtime, other Employer
contributions for pension, insurance or other welfare benefits, or any other
special payments.  Notwithstanding the
foregoing provisions of this Section 2.4, except to the extent otherwise
provided in Section 5.5, “compensation” for each calendar year shall not
exceed the dollar limitation under Section 401(a)(17) of the Code, subject
to any adjustment to reflect increases in the cost of living determined by the
Secretary of the Treasury pursuant to Section 401(a)(17) of the Code.  In determining Average Final Compensation for
Participants whose retirement or termination of employment is on or after January 1,
2002, the Participant’s “compensation” for 2001 and prior years shall be
subject to the annual compensation limit in effect under Section 401(a)(17)
of the Code on January 1, 2002 ($200,000).

 

2.5           “Beneficiary” means any individual, trust, estate or other recipient
entitled pursuant to Section 7.3 of this Plan to receive benefits, on
either a primary or contingent basis, because of the death of a Participant.

 

2.6           “Board of Directors” or “Board” means the Board of Directors of Estee
Lauder.

 

2.7           “Break in Service” means, with respect to any person, a Plan Year during
which such person does not perform more than 500 Hours of Service; provided,
however, that for purposes of Years of Eligibility Service, such term shall
mean the 12-month period commencing on a person’s Employment Commencement Date
or a Plan Year, as the case may be (a “computation period”), during which such
person does not perform more than 500 Hours of Service.  A person who is absent from work for
maternity or paternity reasons shall be credited with the lesser of the number
of Hours of Service necessary to prevent a Break in Service or the number of
hours which otherwise would normally have been credited to such person but for
such absence (i) in the computation period in which the absence begins, if
necessary to prevent a Break in Service, and (ii) in all other cases, in
the following computation period.  For
purposes of this Section, an absence from work for maternity or paternity
reasons means an absence (i) by reason of the pregnancy of the person, (ii) by
reason of the birth of a child of the person, (iii) by reason of the
placement of a child with the person in connection with the adoption of such
child by such person or (iv) for purposes of caring for such child for a
period beginning immediately following such birth or placement.  No person shall incur a Break in Service
solely on account of an absence which qualifies under the Family Medical Leave
Act of 1993, to the extent required under the provisions of such Act.

 

2.8           “Code” means the Internal Revenue Code of 1986, as amended.

 

2.9           “Committee” means The Estee Lauder Inc. Employee Benefits Committee
appointed pursuant to Section 11 hereof.

 

2.10         “Compensation” means, for a particular Plan Year, the straight time
basic salary or wages paid to an Employee by the Employer on and after the
Entry Date on which the Employee first becomes eligible to participate in the
Plan pursuant to Section 3, inclusive of salary reduction contributions
made by an Employer on behalf of the Employee under a “cash or deferred
arrangement” described in Section 401(k) of the Code and pre-tax
contributions made 

 

4

 

by the Employee under a “cafeteria plan” described
in Section 125 of the Code or (effective January 1, 2001) under an
arrangement described in Section 132(f)(4) of the Code, in each case
maintained by the Employer, and including bonuses, shift differential, back-up
pay, overtime pay, paid time off, training and travel time pay, but excluding (i) commissions,
(ii) payments in lieu of unused vacation time, sick time, holidays,
seniority days or other unused paid time off, (iii) referral fees, (iv) gratuities,
(v) relocation payments, (vi) special allowance payments, (vii) sign-on
payments; (viii) on-call compensation, (ix) any other amounts which
are not currently included in the Employee’s income for Federal income tax
purposes and (x) amounts paid under Estee Lauder’s Short-Term Disability
Plan or Long-Term Disability Plan.  In
addition to other applicable limitations that may be set forth in the Plan and
notwithstanding any other contrary provision of the Plan, Compensation taken
into account under the Plan for the purpose of calculating a Plan Participant’s
Accrued Benefit shall not exceed the dollar limitation under Section 401(a)(17)
of the Code, subject to any adjustment to reflect increases in the cost of
living determined by the Secretary of the Treasury pursuant to
Section 401(a)(17) of the Code. 
Notwithstanding the foregoing, for Participants who terminate employment
on or after December 1, 2002, the annual amounts credited to their
Retirement Account pursuant to Section 5 for Plan Years prior to 2002
shall be retroactively adjusted as though the $200,000 dollar limitation in
effect under Section 401(a)(17) of the Code for 2002 had been in effect
for such prior Plan Years (subject to the Plan’s compliance with Sections
401(a)(4) and 415 of the Code and the Treasury Regulations thereunder).

 

2.11         “Disability” means, with respect to any Employee, a condition which
constitutes a disability under the terms of the Employer’s Long-Term Disability
Plan or under Title II of the Federal Social Security Act, regardless of
whether such Employee is otherwise in fact entitled to receive benefits under
the Employer’s Long-Term Disability Plan and/or Title II of the Federal Social
Security Act.

 

2.12         “Early Retirement Date” means the first day of the month which next
follows a Participant’s termination of employment on or after attainment of at
least age 55 and completion of at least ten (10) Years of Service, but
prior to the Participant’s Normal Retirement Date.

 

2.13         “Effective Date,” with respect to the Plan as amended and restated and
set forth herein, means January 1, 2007; provided, however,
that certain provisions of the Plan shall be effective as of the dates set
forth in Section 1.3.

 

2.14         “Employee” means any person who is classified as an employee on the
payroll records of an Employer, in accordance with the Employer’s standard
personnel practices.  Individuals not
classified as employees on the payroll records of the Employer for a particular
period shall not be considered “Employees” for such period even if a court or
administrative agency subsequently determines that such individuals were common
law employees of the Employer during such period.  Anything herein to the contrary
notwithstanding, the term “Employee” shall not include:

 

(a)           a person who is represented by or included in a collective bargaining
unit recognized by the Employer unless the Employer and the collective
bargaining agent have agreed that the Plan shall apply to such unit;

 

5

 

(b)           with respect to periods prior to July 1, 1998, an In-Store
Employee;

 

(c)           a person who would be an In-Store Employee, but for the fact that such
person is classified as an international military sales person;

 

(d)           a person who is a nonresident alien who receives no compensation from an
Employer which constitutes income from sources within the United States (other
than a person employed by Clinique Laboratories, Inc. (Puerto Rico
Branch));

 

(e)           any person who is performing services for the Employer pursuant to an
agreement between the Employer and a third party leasing organization, staffing
firm, professional employer organization or other similar third party
organization; or

 

(f)            a person who is classified as an “on-call employee” in accordance with
the Employer’s standard personnel practices.

 

Notwithstanding the foregoing, and solely for
purposes of determining a person’s non-forfeitable benefit and eligibility to
become a Participant, if a person who had been a Leased Employee becomes an
Employee, such person shall be treated as an Employee from the first date that
such person would have first been treated as a Leased Employee, determined
without regard to the one-year requirement of Section 414(n)(2)(B) of
the Code; provided, however, that such person shall not become a Participant
prior to the first Entry Date coincident with or next following becoming an
Employee.

 

2.15         “Employer” means Estee Lauder, and any other company included within the
Group that includes Estee Lauder (or any other corporation or unincorporated
trade or business not included within the Group that includes Estee Lauder)
that adopts the Plan with the approval of Estee Lauder, as provided in Section 15
hereof, and any successor to any such company that participated in this Plan.

 

2.16         “Employment Commencement Date” means, with respect to any person, the
date coincident with or next following the date on which such person first performs
an Hour of Service; provided, however, that with respect to a person who incurs
a Break in Service and is thereafter reemployed, such term shall mean the date
subsequent to such Break in Service on which he first performs an Hour of
Service.

 

2.17         “Entry Date” means each January 1 and July 1; provided,
however, that prior to January 1, 1993, with respect to any person
who was a regular and non-contingent Employee of the Employer, “Entry Date”
means the first date coincident with or next following such person’s Employment
Commencement Date.

 

2.18         “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.

 

2.19         “Estee Lauder” means Estee Lauder Inc., a corporation duly organized
under the laws of the State of Delaware, and any successor thereto.

 

6

 

2.20         “Fiduciary Committee” means the Estee Lauder Inc. Fiduciary Investment
Committee, the members of which shall be appointed by the Board.

 

2.21         “Group” means Estee Lauder and any other unit or organization that is
related to Estee Lauder as a member of a “controlled group of corporations,” a
group under “common control” or an “affiliated service group,” all as
determined pursuant to Sections 414(b), (c), and (m) of the Code.  With respect to a participating Employer
which is not in the same Group as Estee Lauder, “Group” means such Employer and
any other unit or organization that is related to such employer as a member of
a “controlled group of corporations,” a group under “common control” or an “affiliated
service group,” all as determined pursuant to Sections 414(b), (c) and (m) of
the Code.  For purposes of determining
whether or not a person is an Employee and the period of employment of such
person, each such unit or organization shall be included in the Group only for
such period or periods during which it is a “member” of the Group.

 

2.22         “Hour of Service” means:

 

(a)           Each hour for which an Employee is directly or indirectly compensated,
or entitled to be compensated, by the Employer for the performance of duties.

 

(b)           Each hour for which an Employee is credited by the Employer during an
Approved Absence.

 

(c)           Except as provided in (b) above, each hour, to a maximum of 501
hours for any single continuous period, for which an Employee is directly or
indirectly compensated, or entitled to be compensated, by the Employer for
reasons other than the performance of duties (irrespective of whether the
employment relationship has terminated) due to vacation, holidays, incapacity,
layoff, jury duty or military duty. 
Hours shall not be credited for payment to an Employee from a plan
required by workers’ compensation, unemployment compensation or disability
insurance laws, nor shall hours be credited for reimbursement of such an
Employee for his medical or medically-related expenses.

 

(d)           Each hour for which back pay, irrespective of mitigation of damages, has
been awarded or agreed to by the Employer provided that if such award or
agreement of back pay is for reasons other than the performance of duties, such
hours shall be subject to the restrictions of paragraph (c).

 

The same Hours of Service shall not be credited
under more than one of the paragraphs above. 
All Hours of Service shall be computed and credited to computation
periods in accordance with Sections 2530.200b-2(b) and (c) of the
Department of Labor regulations; provided, however, that Hours of
Service under paragraph (a) above, with respect to any payroll period,
shall be credited for the Plan Year in which such payroll period ends.  In determining an Employee’s Hours of
Service, he shall receive credit for all Hours of Service performed for any
corporation or other entity which is a member of the Group; provided that (a) he
shall not be credited with any Hours of Service performed for any such
corporation or other entity prior to the time that such entity becomes a member
of the Group and (b) the number of Hours of Service 

 

7

 

so credited with respect to his employment with
such entity shall cease at the time such entity is no longer a member of the
Group.

 

Notwithstanding any of the foregoing requirements
of this definition, an individual employed by the Employer (or by any other
member of the Group which includes the Employer) as a common law employee, but
who is not then classified as an Employee (including, but not limited to, an
individual who was an Employee and thereafter becomes an Inactive Participant
on account of a transfer of employment to a non-Employer member of the Group)
shall, except for purposes of determining Years of Credited Service,
nevertheless be credited with Hours of Service for all periods with respect to
which such person is in fact so employed as a common law employee, to the same
extent as if he had been an Employee.

 

When an Employee’s total actual Hours of Service
are not specifically tracked during a payroll period, the following
equivalencies shall be used in accordance with Section 2530.200b-3(e) of
the Department of Labor regulations: 
Employees shall be credited with the following Hours of Service for each
payroll period for which they are required to be credited with at least one
Hour of Service:

 

	
  Payroll Period

  Applicable 

  to Employee

  	
   

  	
  Hours of Service

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Monthly

  	
   

  	
  190

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Semi-monthly

  	
   

  	
  95

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Biweekly

  	
   

  	
  90

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Weekly

  	
   

  	
  45

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Per diem

  	
   

  	
  10

  	
   

  

 

2.23         “In-Store Employee” means any person who:

 

(a)           is classified as an employee on the payroll records of the Employer, in
accordance with the Employer’s standard personnel practices; and

 

(b)           performs services primarily in department stores, or in free-standing
stores owned or leased by Estee Lauder or by another member of the Group that
make sales to the general public (including stores providing sales of
discounted merchandise to the general public).

 

2.24         “Initial Effective Date” means January 1, 1991.

 

2.25         “Leased Employee” means an individual who performs services for the
Employer, other than as a common law employee, if (a) such services are
provided pursuant to a 

 

8

 

written or oral agreement between the Employer and
any other person; (b) the individual has performed during any consecutive
12-month period (i) at least 1,500 Hours of Service for the Employer or (ii) a
number of Hours of Service which is at least 501 and which is at least equal to
75% of the median Hours of Service that are customarily performed by an
employee of the Employer in the particular position; and (c) such services
are performed under the primary direction or control of the Employer.

 

2.26         “Normal Retirement Date” means the first day of the month which next
follows a Participant’s attainment of at least age 65 and completion of at
least five (5) Years of Service.

 

2.27         “Normal Retirement Income” means a Participant’s Accrued Benefit payable
hereunder at his Normal Retirement Date in the form provided in Section 9.1
hereof.

 

2.28         “Participant” means any person who has become eligible to participate in
the Plan in accordance with Section 3, and who has neither been paid in
full any benefit to which he may be entitled under the Plan nor completely
forfeited such benefit.  An “Active
Participant” means a Participant who is an Employee.  An “Inactive Participant” means a Participant
who is not an Active Participant.

 

2.29         “Periodic Adjustment Percentage” means the greater of (i) the
arithmetic daily average of one-year Treasury Constant Maturities for each
calendar year immediately preceding the applicable Plan Year for which it is
applied, as published in the Federal Reserve Statistical Release H.15
(519) of the Board of Governors of the Federal Reserve System, or (ii) 4%.

 

2.30         “Plan” means The Estee Lauder Companies Retirement Growth Account Plan
as effective January 1, 1991, and as it hereafter may be further amended
from time to time.

 

2.31         “Plan Year” means the calendar year.

 

2.32         “Prior Plan” means the Estee Lauder Inc. Employee Retirement Plan, As
Amended Effective July 1, 1975 (incorporating all amendments adopted
through December 31, 1990), or the Estee Lauder Hemisphere Corporation
Pension Plan, As Amended and Restated Effective January 1, 1986
(incorporating all amendments adopted through December 31, 1990), as such
plans were in effect immediately prior to January 1, 1991, whichever plan
(if any) is applicable to a Participant. 
The terms and provisions of the applicable Prior Plan fix and determine
the rights and obligations under the Plan with respect to any Employee whose
employment terminated prior to January 1, 1991.

 

2.33         “Retirement Account” means the bookkeeping account maintained with
respect to a Participant as described in Section 5.1 hereof.

 

2.34         “Retirement Income Commencement Date” means the first day of the first
period for which a benefit under the Plan is paid as an annuity or any other
form.

 

2.35         “Social Security Covered Compensation” means the thirty-five year
average of the maximum annual wages covered by the Federal Social Security Act
as in effect,

 

9

 

ending in the year Social Security retirement age
(as defined in Section 415(b)(8) of the Code) is attained.

 

2.36         “Surviving Spouse” means a wife or husband of a Participant who has been
married to such Participant by legal contract throughout the one-year period
ending on the earlier of the death of the Participant or the Participant’s
Retirement Income Commencement Date; provided, however, that such
term shall also include a wife or husband who married the Participant during
the one-year period prior to such date and, at the date of the Participant’s
death, has been married to the Participant for at least one (1) year.

 

2.37         “Trustee” means the trustee or trustees which may at any time be acting
as trustee of the Trust Fund, as provided in Section 12 hereof.

 

2.38         “Trust Fund” or “Fund” means all funds at any time held by the Trustee
and/or insurance company for the purposes of the Plan, as provided in Section 12
hereof.

 

2.39         “Year of Credited Service” means, with respect to any Participant, a
Plan Year during which the Participant completes at least 1,000 Hours of
Service as an Employee, commencing on such Participant’s Entry Date, or, if
later, January 1, 1993.  In the case
of a Participant who participated in the Plan prior to January 1, 1993,
Years of Credited Service shall also include all Years of Credited Service
accrued under the Plan as of December 31, 1992; fractional Years of
Credited Service accrued under the Plan as of December 31, 1992 shall be
converted to Hours of Service by crediting such Participant, for the Plan Year
commencing on January 1, 1993, with 190 Hours of Service for each calendar
month during which the Participant performed an Hour of Service.  In the case of a Participant who was a
participant in a Prior Plan, Years of Credited Service shall, in addition,
include all Credited Service (as defined in the Prior Plan) recognized under
such Prior Plan for benefit accrual purposes as of December 31, 1990.

 

2.40         “Year of Eligibility Service” means, with respect to any person, a
consecutive 12-month period beginning on such person’s Employment Commencement
Date during which he completes at least 1,000 Hours of Service.  If such person fails to complete at least
1,000 Hours of Service during such 12-month period, then a “Year of Eligibility
Service” shall be determined based on the completion of at least 1,000 Hours of
Service in the Plan Year beginning with or within the 12-month period beginning
on such person’s Employment Commencement Date, and then each Plan Year
thereafter.

 

In the case of a Participant who terminates
employment and does not have any nonforfeitable right to his Accrued Benefit,
Years of Eligibility Service before a period of consecutive one-year Breaks in
Service shall not be taken into account if the number of consecutive one-year
Breaks in Service in such period equals or exceeds five (5).  A Participant whose Years of Eligibility
Service are disregarded pursuant to the preceding sentence shall, upon his
reemployment, be treated as newly employed for eligibility purposes.  If a Participant’s Years of Service may not
thus be disregarded, such Participant shall again become an Active Participant
immediately upon the date he first performs an Hour of Service as an Employee.

 

10

 

2.41         “Year of Service” means, with respect to any person, a Plan Year during
which the person completes at least 1,000 Hours of Service (except as set forth
in Section 8.4 hereof (relating to the “rule of parity”)) commencing
on the later of January 1, 1993, or

 

(i)            for purposes of Section 5.2 hereof, in the case of any In-Store
Employee who becomes a Participant on July 1, 1998 or in the case of
employment by a non-Employer member of the Group, the Employment Commencement
Date,

 

(ii)           for purposes of Section 5.2, in the case of any Participant not
described in the foregoing clause (i), the first day of the Plan Year in which
such person’s Entry Date occurs, and

 

(iii)          for purposes of Section 8 hereof, the Employment Commencement Date.

 

In the case of a person who was in the employ of an
Employer or other member of the Group prior to January 1, 1993, Years of
Service shall also include all Years of Service accrued under the Plan as of December 31,
1992; fractional Years of Service accrued under the Plan as of December 31,
1992 shall be converted to Hours of Service by crediting such person, for the
Plan Year commencing on January 1, 1993, with 95 Hours of Service for each
semi-monthly period during which the person performed an Hour of Service.

 

In the case of a person who was a participant in a
Prior Plan, Years of Service shall, in addition, include (i) for purposes
of Section 8 hereof, all Service (as defined in the Prior Plan) recognized
for purposes of vesting under such Prior Plan as of December 31, 1990 and
(ii) for purposes of Section 5.2, all Credited Service (as defined in
the Prior Plan) recognized under such Prior Plan for benefit accrual purposes
as of December 31, 1990.

 

The masculine pronoun wherever used herein shall
include the feminine pronoun, and the singular shall include the plural.

 

11

 

SECTION 3

 

PARTICIPATION

 

3.1           Each Employee who was a participant in a Prior Plan immediately prior to
the Initial Effective Date shall become a Participant herein as of the Initial
Effective Date.

 

3.2           Each person who becomes an Employee on or after the Initial Effective
Date, or who became an Employee prior to that date but was not a participant in
a Prior Plan immediately prior to the Initial Effective Date, shall become a
Participant on the first Entry Date on which such person is an Employee
coincident with or next following his completion of a Year of Eligibility
Service; provided, however, that any person who was an In-Store
Employee on June 30, 1998 and completed at least a Year of Eligibility
Service at any time on or prior to such date shall become a Participant on July 1,
1998 if such person remains an Employee on such date; and further, provided,
that, in the case of any Employee whose Entry Date, determined without regard
to any Year of Eligibility Service requirement, would otherwise have occurred
prior to January 1, 1993, such Employee shall become a Participant as of
such Entry Date, without the need to also complete a Year of Eligibility Service.

 

3.3           If a person who has been in the employ of an Employer or another member
of the Group as a non-Employee subsequently becomes an Employee, such Employee
shall become a Participant in accordance with Section 3.2 hereof.

 

3.4           A Participant who has become an Inactive Participant on account of his
ceasing to be an Employee, while remaining employed by a member of the Group,
shall once again become an Active Participant upon the date on which he first
performs an Hour of Service as an Employee following the date he becomes an
Inactive Participant.

 

3.5           Except as otherwise provided in this Section, benefits commencing after
Normal Retirement Age shall not be less than the Actuarial Equivalent of the
benefits to which the Participant would have been entitled if such benefits had
commenced at Normal Retirement Age.  Upon
written notification to a Participant who elects to remain in service pursuant
to Section 4.3 hereof, or to a former retired Participant who returns to
the service of an Employer as a Participant herein, the retirement income
payments to which the Participant is entitled on and after Normal Retirement
Age but before he retires (or, in the case of a former retired Participant,
again retires) shall be permanently forfeited so long as such Participant
remains in “section 203(a)(3)(B) service,” as described in Department of
Labor Regulation Section 2530.203-3(c). 
For this purpose, a Participant’s service shall be deemed “section
203(a)(3)(B) service” for any month in which he is credited with at least
40 Hours of Service or such other standard as may be applicable under Section 203(a)(3)(B) of
ERISA.  In the case of a Participant
whose retirement income commenced to be paid before his Normal Retirement Date,
upon his subsequent retirement, his retirement income shall be recomputed,
based on the amount credited to his Retirement Account pursuant to Section 5
hereof and reduced on an actuarial basis to take account of retirement income
payments previously received by him.

 

12

 

3.6           Notwithstanding the foregoing, the following eligibility rules shall
apply to In-Store Employees on and after January 1, 2007:

 

(a)           In-Store Employees who have not become Participants under the preceding
provisions of this Section 3 by December 31, 2006, shall not be
eligible to become Participants after such date.

 

(b)           Individuals who have terminated employment (as In-Store Employees or
otherwise) with an Employer and are rehired on or after January 1, 2007 as
In-Store Employees shall not be eligible to become Participants after their
rehire.  If any such individual was a
Participant immediately prior to his rehire, he shall continue to be a
Participant after his rehire to the extent otherwise permitted under the Plan,
but his Accrued Benefit shall be frozen in accordance with Section 5.9.

 

(c)           Employees who change status on or after January 1, 2007 to that of
an In-Store Employee from another category of Employee shall not be eligible to
become Participants after their status change. 
If any such Employee was a Participant immediately prior to his status
change,

 

(i)            If he was a vested Participant as of December 31, 2006, he shall
continue to be a Participant after his status change for all purposes under the
Plan; and

 

(ii)           If he was not a vested Participant as of December 31, 2006, he
shall continue to be a Participant after his status change to the extent
otherwise permitted under the Plan, but his Accrued Benefit shall be frozen in
accordance with Section 5.9.

 

(d)           An individual whose status changes from that of an In-Store Employee to
another category of Employee on or after January 1, 2007 shall be
permitted to participate in the Plan after such status change if and when he
otherwise satisfies the Plan’s eligibility requirements.

 

(e)           Notwithstanding any other provision of this Section 3.6, with
respect to any individuals who are classified as “on-call employees” in
accordance with the Employer’s standard personnel practices but continue to be
Participants by virtue of the provisions of the Plan in effect prior to the
Effective Date, the Accrued Benefits of such individuals shall continue to be
frozen in accordance with the terms of the Plan as in effect prior to the
Effective Date.

 

13

 

SECTION 4

 

RETIREMENT
DATES

 

4.1           Except as otherwise provided in this Section 4, each Participant
may retire on his Normal Retirement Date and shall receive the Normal
Retirement Income.

 

4.2           A Participant may retire on or after his Early Retirement Date and shall
be entitled to receive his Accrued Benefit on or after his termination of
employment in accordance with the provisions of Sections 9 and 10 hereof.

 

4.3           Any Participant whose employment is continued by the Employer after the
Participant has reached his Normal Retirement Date shall receive retirement
income payments commencing on the first day of the month following the date of
his actual retirement, based on the amount credited to his Retirement Account
at such date.

 

14

 

SECTION 5

 

PARTICIPANTS’
RETIREMENT ACCOUNTS

 

5.1           A Retirement Account shall be established and maintained for each
Participant pursuant to this Section 5 (and for certain individuals who
were participants in a Prior Plan) to which credits shall be made in accordance
with the provisions of this Section 5. 
Except as otherwise provided in Section 5 hereof, an Inactive
Participant who was a participant in a Prior Plan before January 1, 1991
but is not an Active Participant at any time on or after January 1, 1991
shall be credited with an amount equal to his “Accrued Benefit under the Prior
Plan,” determined in accordance with Appendix A, but a Retirement Account shall
not be established for such Inactive Participant.  Except as otherwise provided in Section 5.5
and 5.6 hereof, a Participant’s Accrued Benefit under this Plan shall be based
on the amount credited to his Retirement Account.  The Retirement Account established and
maintained pursuant to this Section 5 is intended to be a bookkeeping
account.  Neither the establishment of
such Retirement Account nor the making of credits to such Retirement Account
shall be construed as an allocation of assets of the Plan to, or a segregation
of such assets in, such account, or otherwise as creating a right of the
Participant to receive specific assets of the Plan.  Benefits provided under the Plan shall be
paid from the general assets of the Plan in the amounts, in the forms and at
the times provided in Sections 4, 8, 9 and 10 hereof.

 

5.2           The annual amount credited to a Participant’s Retirement Account
pursuant to this Section shall be based upon the Participant’s Years of
Service and the Participant’s Compensation for the applicable Plan Year or
portion thereof.  Credits pursuant to this
Section shall be made to a Participant’s Retirement Account as of the last
day of each Plan Year beginning with 1991 and ending with the last day of the
month in which occurs the Participant’s termination of employment.

 

(a)           For each Participant who has fewer than five (5) Years of Service
as of the last day of the Plan Year, credits shall be made to the Participant’s
Retirement Account in an amount equal to three percent (3%) of the Participant’s
Compensation earned while an Active Participant for such Plan Year.

 

(b)           For each Participant who has five (5) Years of Service as of the
last day of the Plan Year, credits shall be made to the Participant’s
Retirement Account in an amount equal to the sum of (i) three percent (3%)
of the Participant’s Compensation earned while an Active Participant for such
Plan Year multiplied by a fraction, the numerator of which is the number of
whole calendar months in such Plan Year while an Active Participant preceding
the anniversary of his Entry Date (“Anniversary Date”) and the denominator of
which is the number of whole months in such Plan Year while an Active
Participant, and (ii) four percent (4%) of the Participant’s Compensation
earned while an Active Participant for such Plan Year multiplied by a fraction,
the numerator of which is the number of whole calendar months in such Plan Year
while an Active Participant following the Anniversary Date (including the
calendar month in which the Anniversary Date occurs) and the denominator of
which is the number of whole months in such Plan Year while an Active
Participant.

 

15

 

(c)           For each Participant who has more than five (5) but fewer than ten (10) Years
of Service as of the last day of the Plan Year, credits shall be made to the
Participant’s Retirement Account in an amount equal to four percent (4%) of the
Participant’s Compensation earned while an Active Participant for such Plan
Year.

 

(d)           For each Participant who has ten (10) Years of Service as of the
last day of the Plan Year, credits shall be made to the Participant’s
Retirement Account in an amount equal to the sum of (i) four percent (4%)
of the Participant’s Compensation earned while an Active Participant for such
Plan Year multiplied by a fraction, the numerator of which is the number of
whole calendar months in such Plan Year while an Active Participant preceding
the Anniversary Date and the denominator of which is the number of whole months
in such Plan Year while an Active Participant, and (ii) five percent (5%)
of the Participant’s Compensation earned while an Active Participant for such
Plan Year multiplied by a fraction, the numerator of which is the number of
whole calendar months in such Plan Year while an Active Participant following
the Anniversary Date (including the calendar month in which the Anniversary
Date occurs) and the denominator of which is the number of whole months in such
Plan Year while an Active Participant.

 

(e)           For each Participant who has more than ten (10) Years of Service as
of the last day of the Plan Year, credits shall be made to the Participant’s
Retirement Account in an amount equal to five percent (5%) of the Participant’s
Compensation earned while an Active Participant for such Plan Year.

 

No credits shall be made pursuant to this Section with
respect to any period during which a Participant is an Inactive
Participant.  In the event that a
Participant becomes an Inactive Participant by reason of his transfer of
employment to a non-Employer member of the Group, no credits shall be made to
his Retirement Account pursuant to this Section after the end of the month
in which the transfer occurs, and for purposes of this Section his
Compensation shall be considered to be $0 after the end of the Plan Year in
which the transfer occurs until such time that he again performs an Hour of
Service as an Employee (i.e., again becomes an Active Participant); provided,
however, that such Participant’s Retirement Account balance shall
continue to be increased in accordance with Section 5.4 hereof following
such transfer.

 

5.3           In the case of an Active Participant in the Plan who as of the Initial
Effective Date had an accrued benefit under a Prior Plan as of December 31,
1990, there shall be credited to the Retirement Account of such Participant as
of January 1, 1991, an amount that is the single sum value of his “Accrued
Benefit under the Prior Plan,” determined in accordance with Appendix A.

 

5.4           For Plan Years beginning on or after the Initial Effective Date, each
Participant’s Retirement Account balance on the first day of the Plan Year
shall be automatically increased as of the last day of the Plan Year by an
amount equal to the Retirement Account balance on the first day of the Plan
Year multiplied by the Periodic Adjustment Percentage; provided, however,
in the case of a Participant who terminates employment, for any reason, such
increase shall continue to be made until the last date as of which a Retirement
Account balance is maintained for such Participant; further  provided,
however, if such increase is for less than a full Plan Year, the
Periodic Adjustment Percentage shall be proportionately reduced.

 

16

 

5.5           In the case of any Participant on or after the Initial Effective Date
who was a Participant under a Prior Plan on December 31, 1990 and
satisfies the applicable requirements set forth in Appendix B, such Participant’s
Accrued Benefit shall be the greater of (i) the amount credited to his
Retirement Account or (ii) the accrued benefit which would have been
determined for him under the terms and provisions of the Prior Plan as in
effect immediately prior to the Initial Effective Date, had such Prior Plan
continued in effect until the date of his termination of employment.  For this purpose, in the case of the Prior
Plan which is the Estee Lauder Inc. Employee Retirement Plan, the annual amount
of the Participant’s Normal Retirement Income is equal to the greater of (a), (b) or
(c) below:

 

(a)           One percent (1%) of that portion of his Average Final Compensation which
is not in excess of his Social Security Covered Compensation plus one and
one-half percent (1-1/2%) of that portion of such Average Final Compensation
which is in excess of such Social Security Covered Compensation, multiplied by
the number of his Years of Credited Service.

 

(b)           $2,500 with 25 or more Years of Credited Service and reduced
proportionately for Years of Credited Service less than 25.

 

(c)           The sum of (i) the amount that would otherwise have been determined
under (a) above had such Participant terminated employment on December 31,
1993 (or, if earlier, his actual date of termination of employment) and had
such Participant’s “compensation” (as used in Section 2.4) for each Plan
Year during the period ending on such applicable date been limited to $200,000
(or such greater amount as may have been permitted after taking into account
increases for cost of living for such Plan Year, as determined by the Secretary
of the Treasury) and with such dollar limit further applied by taking into account
the family aggregation rules of Section 414(q)(6) of the Code
pursuant to Section 401(a)(17) of the Code (as in effect on such
applicable date), and (ii) the benefit that would otherwise have been
determined under (a) above counting only Years of Credited Service
performed after December 31, 1993.

 

In the case of the Estee Lauder Hemisphere
Corporation Pension Plan, the annual amount of the Participant’s Normal
Retirement Income would be equal to the greater of (a), (b) or (c) below:

 

(a)           One
percent (1%) of that portion of his Average Final Compensation which is not in
excess of his Social Security Covered Compensation plus one and one-half
percent (1-1/2%) of that portion of such Average Final Compensation which is in
excess of such Social Security Covered Compensation, multiplied by the number
of his Years of Credited Service.

 

(b)           $1,620
with 25 or more Years of Credited Service and reduced proportionately for Years
of Credited Service less than 25.

 

(c)           The
sum of (i) the amount that would otherwise have been determined under (a) above
had such Participant terminated employment on December 31, 1993 (or, if
earlier, his actual date of termination of employment) and had such Participant’s

 

17

 

“compensation” (as used in Section 2.4) for
each Plan Year during the period ending on such applicable date been limited to
$200,000 (or such greater amount as may have been permitted after taking into
account increases for cost of living for such Plan Year, as determined by the
Secretary of the Treasury) and with such dollar limit further applied by taking
into account the family aggregation rules of Section 414(q)(6) of
the Code pursuant to Section 401(a)(17) of the Code (as in effect on such
applicable date), and (ii) the benefit that would otherwise have been
determined under (a) above counting only Years of Credited Service after December 31,
1993.

 

In the case of a Participant whose Accrued Benefit
is determined under the terms of a Prior Plan under this Section, a Participant
may, subject to consent as provided in Sections 9.4 and 9.5 hereof, elect a
reduced retirement income to commence on the first day of any month which is
between the date of his Early Retirement Date and his Normal Retirement Date.

 

In the case of the Estee Lauder Inc. Employee
Retirement Plan, the amount of the percentage of such reduction shall be equal
to the sum of (a) the product derived by multiplying 7/12ths of one
percent (1%) times the number of whole calendar months by which the pension
commencement date precedes the Participant’s attainment of age 57 and (b) the
product derived by multiplying 5/12ths of one percent (1%) by the excess of (i) the
number of whole calendar months by which the pension commencement date precedes
the Participant’s attainment of age 62 over (ii) the number of whole
calendar months specified in (a).  No
reduction shall be applied to such early retirement income amount if the
pension commencement date occurs on or after the Participant’s attainment of
age 62.

 

In the case of the Estee Lauder Inc. Hemisphere
Corporation Pension Plan, the amount of the percentage of such reduction shall
be equal to the sum of (a) the product derived by multiplying 1/4 of one
percent (1%) times the number of whole calendar months (up to and including the
first 60 thereof) by which the pension commencement date precedes the Normal
Retirement Date and (b) the product derived by multiplying 1/2 of one
percent (1%) by the number of calendar months, if any, by which the pension
commencement date precedes by more than 60 calendar months the Normal
Retirement Date.

 

Notwithstanding any other provision of the Plan to
the contrary:

 

(i)            in the case of any Participant who is eligible for a benefit set forth
in this Section 5.5 and incurs a Disability prior to January 1, 1998,
such Participant (i) shall continue to be credited with Hours of Service
during the period of such Disability, to the same extent as if such person had
not become so disabled, for purposes of determining such person’s Years of
Credited Service used in calculating such person’s benefit pursuant to this Section 5.5,
and (ii) shall, during the portion of such Participant’s period of such
Disability beginning on January 1st of the year following the year in
which such period of Disability first commenced, be considered to continue to
receive “compensation” for purposes of determining such person’s Average Final
Compensation, based upon such person’s level of “base pay” as in effect
immediately prior to the incurring of such Disability, and

 

(ii)           in the case of any Participant who is eligible for a benefit set forth
in this Section 5.5 and incurs a Disability on or after January 1,
1998, such 

 

18

 

Participant (i) shall
continue to be credited with Hours of Service during a period not exceeding the
first twelve months of such Disability, to the same extent as if such person
had not become so disabled, for purposes of determining such person’s Years of
Credited Service used in calculating such person’s benefit pursuant to this Section 5.5,
and (ii) shall, during that portion (if any) of such Participant’s period
of such Disability beginning on January 1st of the year following the year
in which such period of Disability first commenced during which such
Participant continues to be so credited with Hours of Service pursuant to the
immediately preceding clause (i), be considered to continue to receive “compensation”
for purposes of determining such person’s Average Final Compensation, based
upon such person’s level of “base pay” as in effect immediately prior to the
incurring of such Disability;

 

provided, however,
that in no event shall such person continue to be so credited with Hours of
Service or be imputed with “compensation” for periods after such person’s
Normal Retirement Date.

 

5.6           Notwithstanding anything to the contrary provided herein or elsewhere in
the Plan, any Participant who retires on or after his Normal Retirement Date
with at least five (5) Years of Credited Service but less than ten (10) Years
of Credited Service shall be entitled to a Normal Retirement Income of not less
than $100 per month for life, and any Participant who retires on or after his
Normal Retirement Date with at least ten (10) Years of Credited Service
shall be entitled to a Normal Retirement Income of not less than $200 per month
for life.

 

5.7           The benefits otherwise payable to a Participant or a Beneficiary under
this Plan and, where relevant, the Accrued Benefit of a Participant, shall be
limited to the extent required, and only to the extent required, by the
provisions of Section 415 of the Code and rulings, notices and regulations
issued thereunder.  To the extent
applicable, Section 415 of the Code and rulings, notices and regulations
issued thereunder are hereby incorporated by reference into this Plan.  In calculating these limits, the following rules shall
apply:

 

(a)           Except where otherwise specifically set forth in rulings, notices and
regulations incorporated into this Plan by reference, the limitations
applicable to alternative forms of benefits (other than a “qualified joint and
survivor annuity,” as defined in Section 417(b) of the Code) shall be
determined using the factors set forth in Appendix A, subject to the
limitations on actuarial assumptions imposed by Section 415(b)(2)(E) of
the Code.

 

(b)           If the applicable limits of Section 415 of the Code are increased
after a benefit is in pay status by virtue of an adjustment to those limits
reflecting a change in the cost of living index or an amendment to the Code,
benefit payments to a Participant or his Beneficiary shall be increased
automatically to the maximum extent permitted under the revised limits.  This increase shall occur only to the extent
it would not cause the benefit to exceed the benefit to which the Participant
or Beneficiary would have been entitled in the absence of the limits under Section 415
of the Code.

 

(c)           If, upon the death of a Participant whose benefits were limited under
this Section, the Surviving Spouse shall be entitled to a benefit payment
smaller than that

 

19

 

which was payable while the Participant was alive,
the benefit payments to the Surviving Spouse shall equal the lesser of:

 

(i)            the benefit payment which would be payable to the Surviving Spouse if
benefits under this Plan had not been limited by this Section, and

 

(ii)           the benefit payment which would be payable to the Surviving Spouse if
the benefit provided under this Plan had been a “qualified joint and survivor
annuity,” as defined in Section 417(b) of the Code, with survivor
benefits equal to 100% of the amount payable while the Participant was alive,
in an amount equal to the maximum limitations provided under this Section.

 

(d)           If the Participant is entitled to a benefit under any defined benefit
plan which is, or ever has been, maintained by the Employer or another member
of the Group, the limits under this Section shall be applied to the
combined benefits payable and the benefit payable hereunder shall be reduced to
the extent necessary to make the combined benefits meet the limits under this
Section.

 

(e)           To calculate average compensation for a Participant’s high-three years
of service, compensation shall be the Employee’s Compensation, and the
three-year average shall be calculated using consecutive limitation years.  In making such average compensation
calculations in limitation years beginning on or after April 5, 2007, the
compensation limit of Section 401(a)(17) of the Code shall apply for each
year taken into account in calculating such average.  Notwithstanding the immediately preceding
sentence, the benefits accrued or payable with respect to a Participant as of
the end of the limitation year that immediately precedes the first limitation
year beginning on or after April 5, 2007, pursuant to Plan provisions that
were both adopted and in effect before April 5, 2007, shall be deemed to
satisfy the limitations of Section 415(b) of the Code in accordance
with Treasury Regulation Section 1.415(a)-1(g)(4).

 

(f)            A limitation year shall be a Plan Year for purposes of this Section.

 

5.8           Notwithstanding any other provision of the Plan to the contrary, the
Accrued Benefit of an Inactive Participant who (i) was a participant in a
Prior Plan and (ii) had a condition of Disability as of December 30,
1990, shall continue to be determined under the benefit formula of such Prior
Plan, unless such Inactive Participant is eligible for the benefit set forth in
Section 5.5 hereof.  A Participant
who first has a condition of Disability on or after January 1, 1991 shall
be covered under the benefit formula of this Plan as of the Initial Effective
Date unless such Participant is eligible for the benefit set forth in Section 5.5
hereof.  For purposes of determining the
opening Retirement Account balance under this Plan, Average Final Compensation
shall be used, except that with respect to any year in which there were no
earnings or earnings were reduced because of Disability, such Participant’s
last year of actual base pay shall be used on an annualized basis.

 

5.9           Notwithstanding the foregoing, the following rules shall apply to In-Store Employees effective as of December 31, 2006:

 

20

 

(a)           The Accrued Benefit of any Participant who is an
In-Store Employee and is not vested in such Accrued Benefit as of December 31,
2006 shall be frozen as of such date.

 

(b)           The Accrued Benefit of any Participant who terminates employment (as an In-Store Employee or otherwise) with an
Employer and is rehired on or after January 1, 2007 as an In-Store
Employee shall be
frozen as of the date immediately preceding the date of such rehire (or such
earlier date as may have applied under other provisions of the Plan).

 

(c)           The Accrued Benefit of any Participant who changes status on or after January 1, 2007 to that of an In-Store
Employee from another category of Employee shall be frozen as of the date immediately
preceding the date of such status change (or such earlier date as may have
applied under other provisions of the Plan). 
The preceding sentence shall not apply, however, to any Participant who
was vested in his Accrued Benefit as of December 31, 2006.

 

(d)           Following the applicable date of the Accrued
Benefit freeze described in subsections (a), (b) or (c) above, the
Retirement Account of the affected Participant shall no longer be eligible for
Compensation-based credits pursuant to Section 5.2, but shall continue to
be eligible for increases based on the Periodic Adjustment Percentage pursuant
to Section 5.4.

 

(e)           If a Participant whose Accrued Benefit is frozen under this Section 5.9
changes status on or after January 1, 2007 from that of an In-Store
Employee to another category of Employee that is eligible to accrue benefits
under the Plan, he shall be permitted to accrue additional benefits after such
status change in accordance with the terms of the Plan.

 

(f)            Notwithstanding
any other provision of this Section 5.9, with respect to any individuals
who are classified as “on-call employees” in accordance with the Employer’s
standard personnel practices but continue to be Participants by virtue of the
provisions of the Plan in effect prior to the Effective Date, the Accrued
Benefits of such individuals shall continue to be frozen in accordance with the
terms of the Plan as in effect prior to the Effective Date.

 

21

 

SECTION 6

 

CONTRIBUTIONS

 

6.1           No contributions are to be made by Participants under this Plan.

 

6.2           Subject to the provisions of Section 13 hereof, the Employer
intends to contribute over a period of time such amounts as may be determined
by actuarial calculations to be required of the Employer to provide benefits in
accordance with the Plan.  Any
forfeitures arising under the Plan shall not be applied to increase the
benefits any Participant would otherwise receive under the Plan but shall be
applied to reduce the Employer contributions under the Plan.

 

6.3           Subject to the provisions of Section 13 hereof, the administrative
expenses of the Plan, except to the extent paid by the Employer, shall be paid
out of the funds of the Plan.

 

6.4           Except as provided in paragraphs (a) and (b) below, and except
as provided in Section 16 hereof, Employer contributions made under the
Plan will be held for the exclusive benefit of Participants, and their joint
annuitants or Beneficiaries and may not revert to the Employer.

 

(a)           A contribution made by the Employer under a mistake of fact may be
returned to the Employer within one (1) year after it is contributed to
the Plan.

 

(b)           A contribution conditioned upon its deductibility under Section 404
of the Code may be returned, to the extent the deduction is disallowed, to the
Employer within one (1) year after the disallowance.  All contributions to the Plan are hereby
conditioned upon their deductibility.

 

The maximum contribution that may be returned to the
Employer will not exceed the amount actually contributed to the Plan, or the
value of such contribution on the date it is returned to the Employer, if less.

 

6.5           In recognition of the fact that the Plan is, effective January 1,
1996, subject to the requirements of Section 413(c) of the Code, the
provisions of Section 413(c)(4) of the Code shall, with respect to
periods on and after that date, be applied consistent with such rules and
procedures as shall be adopted by the actuary appointed under the Plan.

 

22

 

SECTION 7

 

DEATH
BENEFIT

 

7.1           Death Before Retirement Date.

 

(a)           If a Participant with a nonforfeitable right to the amount credited to
his Retirement Account pursuant to Section 8 hereof dies prior to commencement
of benefits, then his Surviving Spouse, or if (i) the Participant elects a
Beneficiary other than his Surviving Spouse and such Surviving Spouse consents
to such designation pursuant to Section 7.3 of the Plan or (ii) the
Participant is unmarried, the Participant’s designated Beneficiary, shall
receive the amount credited to the Retirement Account, payable in a single life
annuity.  The Surviving Spouse (or
designated Beneficiary, if applicable) may elect to receive such benefit in a
cash lump sum payment; provided, however, that if the Actuarial Equivalent
value of such amount does not exceed $5,000 (with respect to Plan Years
beginning on or after January 1, 1998), such value shall automatically be
paid in a cash lump sum in accordance with the last sentence of Section 10.1
hereof.

 

(b)           Notwithstanding the foregoing subsection (a), if (i) a Participant
described in such subsection (a) was subject to the provisions of Section 5.5
and (ii) at the time of his death there is a Surviving Spouse and the
Participant has not designated a Beneficiary other than his Surviving Spouse
with such Surviving Spouse’s consent pursuant to Section 7.3, the single
life annuity otherwise payable to such Surviving Spouse pursuant to this Section 7.1
shall not be less than the single life annuity otherwise payable to such person
determined in accordance with the provisions of Section 6.1 or 6.2, as the
case may be, of the appropriate Prior Plan and based solely on such Participant’s
Normal Retirement Income determined in accordance with Section 5.5;
provided, however, that if the Actuarial Equivalent value of the single life
annuity otherwise so determined pursuant to this subsection (b) does not
exceed $5,000 (with respect to Plan Years beginning on or after January 1,
1998), such value shall automatically be paid in a cash lump sum in accordance
with the last sentence of Section 10.1 hereof.

 

7.2           Death After Date of Commencement of Benefits.  In the event of a Participant’s
death after commencement of benefits, and if an optional form of benefit under Section 9.3
hereof is applicable, then the death benefit payable hereunder, if any, shall
be determined in accordance with such optional election.  Otherwise, no death benefit shall be payable.

 

7.3           Beneficiary Designation.  If a Participant has a Surviving Spouse, his
Surviving Spouse shall be his Beneficiary, unless the Participant designates
someone other than his Surviving Spouse as his Beneficiary (other than as a
contingent Beneficiary) and the Surviving Spouse consents to such
designation.  If the Participant does not
have a Surviving Spouse or if his Surviving Spouse consents, the Participant
shall have the right to designate any person as a Beneficiary, to receive the
amount, if any, payable pursuant to this Plan upon his death and may from time
to time change any such designation in accordance with procedures established
by the Committee.  Each such designation
shall be submitted to the Committee or its 

 

23

 

designee in such form and manner as may be required
by the Committee or its designee.  In the
event that a Participant designates someone other than his Surviving Spouse as
his Beneficiary (other than as a contingent Beneficiary), such Beneficiary
designation shall not be effective unless (i) the Surviving Spouse
consents to such Beneficiary designation in writing, in a form acceptable to
the Committee or its designee, and such consent is witnessed by a Plan
representative or a notary public or (ii) the Participant provides the
Committee or its designee with sufficient evidence to show that the Participant
does not have a Surviving Spouse or that his Surviving Spouse cannot be
located.  The Committee shall decide
which Beneficiary, if any, shall have been validly designated.  If a Participant does not have a Surviving
Spouse and no Beneficiary has been designated, or if a Participant does not
have a Surviving Spouse and the Committee determines that a designation made by
the Participant is not effective for any reason, the Committee shall designate
as Beneficiary the estate of the deceased Participant.

 

24

 

SECTION 8

 

TERMINATION
OF EMPLOYMENT

 

8.1           A Participant shall be 100% vested in the amount credited to his
Retirement Account after having completed at least five (5) Years of
Service.  Effective for Plan Years
beginning on or after January 1, 2008, a Participant shall be 100% vested
in the amount credited to his Retirement Account after having completed at
least three (3) Years of Service. 
If a Participant terminates employment other than by early or normal
retirement or death after having completed at least five (5) Years of
Service (or at least three (3) Years of Service effective for Plan Years
beginning on or after January 1, 2008), he shall be entitled to elect
payment of the amount credited to his Retirement Account as of such date of
termination in a cash lump sum or, (i) if the Participant has a Surviving
Spouse at the time of such termination of employment, as an annuity of the form
described in Section 9.2 hereof or (ii) if the Participant has no
Surviving Spouse at the time of such termination of employment, as an annuity
of the form of benefit described in Section 9.1 hereof.  Such payment shall be made (or in the case of
an annuity, shall commence) in accordance with the last sentence of Section 10.1
hereof, and such election to be subject to consent as provided in Sections 9.4
and 9.5 hereof; provided, however, that if the Actuarial
Equivalent value of such amount does not exceed $1,000 (with respect to
distributions commencing on or after March 28, 2005) or $5,000 (with
respect to distributions commencing prior to March 28, 2005 and on or
after January 1, 1998), such value shall automatically be paid in a cash
lump sum in accordance with the last sentence of Section 10.1 hereof.  If such Participant does not elect such lump
sum or annuity, he shall be entitled to receive his Accrued Benefit commencing
on the first day of any month after his termination of employment (but not
later than his Normal Retirement Date), payable in a lump sum or as an annuity,
in accordance with Sections 9.1 or 9.2 hereof, to the extent applicable.  For purposes of this Section 8, a
Participant who is terminated for Disability after a one-year absence because
of Disability shall be deemed to have completed at least five (5) Years of
Service.

 

8.2           In no event shall the retirement income of a terminated Employee who was
a participant under a Prior Plan immediately prior to the Initial Effective
Date be less than the Actuarial Equivalent of the benefit that would have been
payable under the Prior Plan had the Participant’s employment terminated
immediately prior to the Initial Effective Date.

 

8.3           Notwithstanding any other provision of this Plan, each Participant shall
be 100% vested in his Retirement Account on his Normal Retirement Date.

 

8.4           (a)           If a Participant’s service terminates prior to having completed five (5) Years
of Service (or three (3) Years of Service for any Participant who performs
at least one (1) Hour of Service on or after January 1, 2008), and at
a time when he is 0% vested in the amount credited to his Retirement Account,
he shall, notwithstanding any other provision of the Plan to the contrary, be
deemed to automatically receive, as of such person’s date of termination of
employment, a single lump sum distribution which is the Actuarial Equivalent of
his entire vested Accrued Benefit under the Plan, and he shall thereupon
forfeit his Retirement Account as of such same date.  Any forfeiture resulting from the operation
of this Section, or any other provisions of the Plan, shall be used to reduce
future Employer contributions.

 

25

 

(b)           If a Participant’s Retirement Account is forfeited pursuant to the
preceding paragraph (a) above and such Participant is subsequently
reemployed as an Employee of an Employer (i) after the number of
consecutive one-year Breaks in Service equals or exceeds five (5), the Years of
Service completed prior to the Breaks in Service shall not be aggregated with
Years of Service completed after the reemployment date, or (ii) prior to
incurring five (5) or more consecutive one-year Breaks in Service, the
amounts previously credited to his Retirement Account will be restored, the
Years of Service completed prior to the Breaks in Service will be aggregated
with the Years of Service after his reemployment date and the Participant shall
become a Participant of the Plan upon his reemployment.

 

(c)           If a Participant’s vested percentage is 100% at the time of his
termination of employment, and such Participant is subsequently reemployed as
an Employee of an Employer, Years of Service completed prior to any number of
one-year Breaks in Service shall be aggregated with Years of Service after the
reemployment.  If such Participant
received a complete distribution of his benefits under the Plan prior to his
reemployment, then the amounts credited to his Retirement Account as of his
date of termination shall be restored on his reemployment date, but any
subsequent distribution paid to the Participant after his reemployment shall be
offset by the present value of any distributions previously paid to him at any
time in accordance with the requirements of Section 411(a)(7) of the
Code and the regulations promulgated thereunder.

 

(d)           For purposes of determining the amount credited to the Retirement
Account of a reemployed Participant described in Section 8.4(c) above,
(i) if such Participant received a complete distribution of his benefits
under the Plan prior to his reemployment, the amount credited to his Retirement
Account upon reemployment shall be $0, and (ii) if such Participant
received distributions of only a portion of his benefits under the Plan prior
to his reemployment, the amount credited to his Retirement Account upon
reemployment shall be the amount credited to his Retirement Account at the time
of his prior termination of employment less the amount of such distributions,
and his Retirement Account shall be increased in accordance with Section 5.4
by applying the Periodic Adjustment Percentage to the undistributed amounts
credited to his Retirement Account during the period between his termination of
employment and his reemployment. 
Notwithstanding the foregoing, if the reemployed Participant repays in
full his prior distributions plus interest in accordance with Section 411(a)(7) of
the Code, the Participant’s Retirement Account shall be credited with the full
amount credited to such Retirement Account at the time of his prior termination
of employment, increased in accordance with Section 5.4 by applying the
Periodic Adjustment Percentage to such amount for the period between his
termination of employment and his reemployment.

 

8.5           Notwithstanding the foregoing provisions of this Section 8 and
solely in the case of a Participant subject to the provisions of Section 5.5:

 

(a)           if such Participant’s Accrued Benefit is in fact determined pursuant to Section 5.5,
rather than with reference to the amount credited to his Retirement Account,
then the provisions of Section 8.1 shall instead be applied with reference
to such Accrued Benefit so determined pursuant to Section 5.5, and in
connection therewith, the amount of any cash lump sum shall be the Actuarial
Equivalent of such Accrued Benefit; and

 

26

 

(b)           regardless of whether such Participant’s Accrued Benefit is in fact so
determined pursuant to Section 5.5, the provisions of Section 8.4
shall be applied with reference to both such person’s Retirement Account and
the amount otherwise calculated pursuant to Section 5.5.

 

27

 

SECTION 9

 

OPTIONAL
FORMS OF BENEFIT

 

9.1           Normal Form of Benefit.

 

(a)           The normal form of benefit shall be an income payable monthly for life,
commencing on the Normal Retirement Date and terminating with the payment
preceding death; provided, however, that a Participant may, with
spousal consent under the terms of Section 9.4 hereof, if applicable,
elect to receive the amount credited to his Retirement Account in a single cash
lump sum; further  provided, however, that if the Actuarial
Equivalent value of such amount does not exceed $1,000 (with respect to
distributions commencing on or after March 28, 2005) or $5,000 (with
respect to distributions commencing prior to March 28, 2005 and on or
after January 1, 1998), such value shall automatically be paid to the
Participant in a cash lump sum in accordance with the last sentence of Section 10.1
hereof.

 

(b)           Notwithstanding the foregoing subsection (a) and in the case of a
Participant subject to the provisions of Section 5.5 or Section 5.6,
if such Participant’s Accrued Benefit is in fact determined pursuant to Section 5.5
or Section 5.6, rather than with reference to the amount credited to his
Retirement Account, then the provisions of the foregoing subsection (a) shall
instead be applied with reference to such Accrued Benefit so determined
pursuant to Section 5.5 or Section 5.6, and in connection therewith,
the amount of any cash lump sum shall be the Actuarial Equivalent of such
Accrued Benefit.

 

9.2           Automatic Post-Retirement Surviving Spouse Option.  Subject to the conditions
hereinafter set forth in this Section, if a Participant has a Surviving Spouse
at his Retirement Income Commencement Date, the amount of retirement income
payment to which he would otherwise be entitled under the normal form of
benefit described in Section 9.1 shall be reduced on an Actuarial
Equivalent basis to reflect the fact that, if such spouse shall survive him, a
retirement income shall be payable under the Plan to his Surviving Spouse
during such spouse’s remaining lifetime after his death in an amount equal to
50% of the reduced amount of retirement income payments.  A married Participant may elect (and may
revoke such election and thereafter reelect) that his retirement income not be
paid in the 50% joint and survivor form described in the preceding sentence,
subject to the provisions of Section 9.4 hereof.

 

9.3           Notwithstanding the foregoing provisions of this Section 9, a
Participant who retires on or after his Early Retirement Date may, subject to
consent as provided in Sections 9.4 and 9.5 hereof, elect to receive the value
of (i) his entire Accrued Benefit in accordance with Option 1 or 2; or (ii) his
Accrued Benefit as of his Retirement Income Commencement Date less the value of
his Accrued Benefit as of December 31, 1990 separately in accordance with
Option 1 or 2, and his Accrued Benefit as of December 31, 1990 under a
Prior Plan separately in accordance with Option 3, 4 or 5.

 

Option 1.  An Actuarial Equivalent retirement income to
be paid to the retired Participant for the rest of his life, and after his
death either 50%, 100% or, effective for Plan Years beginning on or after January 1,
2008, 75% (in accordance with his election) of such 

 

28

 

Actuarial Equivalent retirement income to be paid
to his contingent annuitant for the rest of the contingent annuitant’s life.

 

Option 2.
 An Actuarial Equivalent retirement
income to be paid to the retired Participant payable for the greater of his
lifetime or a period of ten (10) years. 
If the retired Participant dies before the expiration of ten (10) years,
the remaining installments of his Actuarial Equivalent retirement income shall
be paid to his Beneficiary.

 

Option 3.  An Actuarial Equivalent retirement income to
be paid to the retired Participant for the rest of his life, and after his
death either 25%, 66.67%, 75% or 100% (in accordance with his election) of such
Actuarial Equivalent retirement income to be paid to his contingent annuitant
for the rest of the contingent annuitant’s life.

 

Option 4.  An Actuarial Equivalent retirement income to
be paid to the retired Participant for the rest of his life, and if he dies
before receiving 120 monthly payments, such Actuarial Equivalent retirement
income to be paid to his Beneficiary for the remainder of the 120 months.

 

Option 5.  A Participant who retires early in accordance
with Section 4.2 hereof may elect to receive an Actuarial Equivalent
retirement income providing larger monthly payments, in lieu of the retirement
income otherwise payable upon early retirement, until the earliest date on
which his Social Security benefit could commence; thereafter his monthly
retirement income payments shall be reduced by the estimated monthly amount of
his Social Security benefit computed to commence on such date.  This optional form provides, insofar as practical,
a level total retirement income (from this Plan and Social Security) for the
Participant.  In the event of the
election of this Social Security adjustment option, the monthly payment of the
adjusted retirement income shall commence at the date of retirement and shall
cease with the earlier of the last payment prior to the death of the
Participant or the last payment payable as calculated under this option.

 

9.4           The following rules and requirements must be met in order for any
optional form of retirement income to be applicable.

 

(a)           The election must be made pursuant to a qualified election (as described
in paragraphs (b) and (g) of this Section) and filed with the
Committee or its designee within the 90-day period (180-day period for Plan
Years beginning on or after January 1, 2007) ending on the Retirement
Income Commencement Date.

 

(b)           The consent of a contingent annuitant or Beneficiary shall not be
required for a qualified election of an option; except that, if a married
Participant elects to receive a form of benefit other than the Automatic
Post-Retirement Survivor Spouse Option described in Section 9.2 hereof, a
qualified election requires that the Surviving Spouse waive such spouse’s right
to the Automatic Post-Retirement Surviving Spouse Option.  Such waiver shall not be effective unless (i) the
consent is in writing; (ii) the election designates a specific alternate
Beneficiary, including any class of Beneficiaries or any contingent
Beneficiaries, which may not be changed without spousal consent (or the
Surviving Spouse expressly permits designations by the Participant without any
further spousal consent); (ii) the Surviving Spouse’s

 

29

 

consent acknowledges the effect of the election; (iv) the
Surviving Spouse’s consent is witnessed by a Plan representative or notary
public; and (v) the election designates a form of benefit payment that may
not be changed without spousal consent (or the Surviving Spouse expressly
permits designations by the Participant without any further spousal
consent).  In the absence of a waiver by
such spouse, other than for the reason that such spouse cannot be located, the
election of a form of payment other than as provided in Section 9.2 hereof
shall be null and void.  Any consent by a
Surviving Spouse obtained under this provision (or establishment that the
consent of a Surviving Spouse may not be obtained) shall be effective only with
respect to such Surviving Spouse.  A
consent that permits designations by the Participant without any requirement of
further consent by the Surviving Spouse must acknowledge that such spouse has
the right to limit consent to a specific Beneficiary, and a specific form of
benefit where applicable, and that such spouse voluntarily elects to relinquish
either or both of such rights.  A
revocation of a prior waiver may be made by a Participant without the consent
of the Surviving Spouse at any time prior to the commencement of benefits.  The number of revocations shall not be
limited.  No consent obtained under this
provision shall be valid unless the Participant has received notice as provided
in paragraph (g) of this Section.

 

(c)           An election may not be made nor will it be accepted by the Committee or
its designee, or if accepted it shall become null and void, if the Actuarial
Equivalent value of the Participant’s entire Accrued Benefit as of his
Retirement Income Commencement Date would be $1,000 or less (with respect to
distributions commencing on or after March 28, 2005) or $5,000 or less
(with respect to distributions commencing prior to March 28, 2005 and on
or after January 1, 1998), and such value shall automatically be paid to
the Participant in a cash lump sum.

 

(d)           If the stated effective date of the option is prior to the Participant’s
Normal Retirement Date and the Participant continues in service after such
stated effective date, the election shall become null and void but, subject to
the rules and requirements contained in this Section, the Participant may
thereafter make another election.  If the
stated effective date is the Participant’s Normal Retirement Date or any later
date and he continues in service after such stated effective date, the option
shall take effect upon his subsequent death or retirement.

 

(e)           If a Participant who has elected Option 4 under Section 9.3 hereof
dies while the option is in effect, and his Beneficiary is a natural person who
survives the Participant but dies before the 120 monthly payments have been
paid to the Participant and the Beneficiary, the lump sum discounted value of
the unpaid balance of such 120 monthly payments shall be paid to the
Beneficiary’s estate.

 

(f)            If the contingent annuitant is other than the Surviving Spouse, and if
the actuarial present value of the payments to be made to the Participant under
an option will be less than 51% of the Actuarial Equivalent value of the normal
form of retirement benefit provided in Section 9.1 hereof, the optional
benefit shall be adjusted so that the value of the Participant’s benefit will
be equal to 51% of the Actuarial Equivalent value of the Participant’s normal
form of retirement benefit.

 

(g)           No election shall be a qualified election unless, at least 30 days (or
such a shorter period permitted by the Code and the regulations promulgated
thereunder) and no 

 

30

 

more than 90 days (180 days for Plan Years
beginning on or after January 1, 2007) prior to the Participant’s
Retirement Income Commencement Date, the Committee shall furnish him (by mail
or personal delivery) a statement generally describing the 50% joint and
survivor form and other optional forms of benefit and explaining the relative
financial effects of making an election under Section 9.2 hereof, or an
election of an optional form of payment under Section 9.3 hereof.  The statement shall also describe the right
of the Participant and his Surviving Spouse to waive the 50% joint and survivor
form, the effect of such a waiver, and the right to revoke such waiver.

 

9.5           If the Actuarial Equivalent value of a Participant’s vested Accrued
Benefit exceeds $1,000 or $5,000 (for the period from January 1, 1998
through March 27, 2005), and the Accrued Benefit is “immediately
distributable” (as defined below), the Participant and any Surviving Spouse (or
where either the Participant or the spouse has died, the survivor) must consent
to any distribution of such Accrued Benefit. 
An Accrued Benefit is “immediately distributable” if any part of the
Accrued Benefit could be distributed to the Participant (or Surviving Spouse)
before the Participant attains (or would have attained if not deceased) Normal
Retirement Age.  The consent of the
Participant and any Surviving Spouse shall be obtained in writing within the
90-day period (180-day period for Plan Years beginning on or after January 1,
2007) ending on the Retirement Income Commencement Date.  The Participant and any Surviving Spouse
shall be notified of the right to defer any distribution until the Participant’s
Accrued Benefit is no longer immediately distributable and, for Plan Years
beginning on or after January 1, 2008, of the consequences of failing to
defer receipt of such distribution). 
Such notification shall include a general description of the material
features, and an explanation of the relative values of, the optional forms of
benefit available under the Plan in a manner that would satisfy the notice
requirements of Section 417(a)(3) of the Code, and shall be provided
no less than 30 days (or such shorter period permitted by the Code and the
regulations promulgated thereunder) and no more than 90 days (180 days for Plan
Years beginning on or after January 1, 2007) prior to the Retirement
Income Commencement Date. 
Notwithstanding the foregoing, only the Participant need consent to the
commencement of a distribution in the 50% or 100% joint and survivor form while
the Accrued Benefit is immediately distributable.  Neither the consent of the Participant nor
the Surviving Spouse shall be required to the extent that a distribution is
required to satisfy Section 401(a)(9) or 415 of the Code.

 

9.6           Any Distributee (as defined below) who is entitled to receive a Plan
distribution that would be an “Eligible Rollover Distribution” (as defined below),
may elect to have such distribution paid in the form of a direct
trustee-to-trustee transfer to an “Eligible Retirement Plan” (as defined below)
specified by such individual.  The
Committee shall prescribe uniform rules for making such direct transfer
election.  For purposes of this Section 9.6:

 

(a)           “Distributee” means a (i) Participant, (ii) the Surviving
Spouse of a Participant, (iii) an alternate payee (within the meaning of Section 414(p) of
the Code) who is a Spouse or former Spouse of the Participant, or (iv),
effective for distributions on or after January 1, 2007, a non-Spouse
Beneficiary.

 

(b)           “Eligible Rollover Distribution” means any distribution of all or any
portion of the balance to the credit of the individual, except that an Eligible
Rollover Distribution does not include: any distribution that is one of a
series of substantially equal 

 

31

 

periodic payments (not less frequently than
annually) made for the life (or life expectancy) of the individual or the joint
lives (or joint life expectancies) of the individual and the individual’s
designated Beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under Section 401(a)(9) of
the Code; and any distribution that is made upon hardship of the individual.

 

(c)           “Eligible Retirement Plan” means any of the following plans or
arrangements that accepts the individual’s Eligible Rollover Distribution: (i) an
individual retirement account described in Section 408(a) of the
Code, (ii) an individual retirement annuity described in Section 408(b) of
the Code, (iii) a qualified plan trust, (iv) an annuity plan
described in Section 403(a) of the Code, (v) an annuity contract
described in Section 403(b) of the Code, or (vi) an eligible
deferred compensation plan described in Section 457(b) of the Code
that is maintained by a state, political subdivision of a state, or any agency
or instrumentality of a state or political subdivision of a state.  In the case of a non-Spouse Beneficiary, an “Eligible
Retirement Plan” shall include only (i) an individual retirement account
described in Section 408(a) of the Code, or (ii) an individual
retirement annuity described in Section 408(b) of the Code (other
than an endowment contract), established for the purpose of receiving the
Eligible Rollover Distribution on behalf of such non-Spouse Beneficiary.

 

32

 

SECTION 10

 

PAYMENT
OF RETIREMENT INCOME

 

10.1         Subject to the provisions of Sections 9 and 11 hereof, retirement income
payable in other than a lump sum shall be payable in monthly installments, as
of the first day of each month with the first payment to be made as of the
appropriate retirement date or earlier date of termination of employment, but
in no event later than the 60th day after the later of the close of the Plan
Year in which the Participant attains age 65 or terminates employment or in
which occurs his tenth (10th) Year of Credited Service, and with final payment
to be made as of the first day of the month in which death occurs, or, if
earlier, the first day of the month payments cease under the option
elected.  Subject to the foregoing
sentence, retirement income payable in a single cash lump sum shall be paid on
or as soon as administratively possible following the date he becomes entitled
thereto.

 

10.2         Anything elsewhere in the Plan to the contrary notwithstanding, the
entire nonforfeitable interest of each Participant shall be either:

 

(a)           distributed to the Participant not later than the Participant’s “Required
Beginning Date” (as defined in Section 10.2(b)), or

 

(b)           distributed to, or for the benefit of, the Participant and the
Participant’s contingent annuitant in installments beginning not later than the
Participant’s Required Beginning Date and continuing, in accordance with such
regulations as the Secretary of the Treasury may prescribe, (i) over the
life of the Participant or over the lives of the Participant and the
Participant’s contingent annuitant or (ii) over a period certain not
extending beyond the life expectancy of the Participant and the Participant’s
Beneficiary.  For purposes of this
Section, the “Required Beginning Date” shall mean the later of April 1 of
the calendar year which follows the calendar year in which the Participant
attains age 701⁄2, or the calendar year in which the Participant retires; provided,
however, that a distribution to a Participant who is a five percent
owner (as defined in Section 416 of the Code) shall begin no later than April 1
of the calendar year which follows the calendar year in which such Participant
attains age 70-1/2.  Notwithstanding the
foregoing, any Participant who attains age 70-1/2 after December 31, 1995
but on or before December 31, 1997 may elect to nevertheless commence his
distribution on April 1 of the calendar year following the calendar year
in which the Participant attains age 70-1/2 even if the Participant is still
employed by the Employer.  In addition to
the foregoing, in applying the rules of this Section 10.2, the
regulations promulgated under Section 401(a)(9) of the Code are
incorporated herein by reference, as are the rules promulgated by the
Department of the Treasury and the Internal Revenue Service with respect to
compliance with Section 401(a)(9) of the Code without violating Section 411(d)(6) of
the Code.

 

If distribution of a Participant’s nonforfeitable
interest has begun in accordance with Section 10.2(b) hereof and the
Participant dies before his entire nonforfeitable interest has been distributed
to him, the remaining portion of such interest shall be distributed at least as
rapidly as under the method of distribution being used under Section 10.2(b) hereof
as of the date of the Participant’s death.

 

33

 

If a Participant dies before distribution of the
Participant’s nonforfeitable interest has begun in accordance with Section 10.2(b) hereof,
the entire nonforfeitable interest shall be distributed within five years after
the death of the Participant, except such portion thereof as shall be payable
in installments to, or for the benefit of, the Participant’s contingent
annuitant, beginning not later than one (1) year after the date of the
Participant’s death and continuing, in accordance with such regulations as the
Secretary of the Treasury may prescribe, over the life of the contingent
annuitant (or over a period certain not extending beyond the life expectancy of
the contingent annuitant); provided, however, that if the Surviving Spouse is
the Participant’s contingent annuitant, the date on which the distributions are
required to begin shall not be later than the Participant’s Required Beginning
Date and, if the Surviving Spouse dies before the distributions to the Surviving
Spouse begin, this paragraph shall be applied as if the Surviving Spouse was
the Participant.

 

34

 

SECTION 11

 

ADMINISTRATION
OF THE PLAN

 

11.1         Except with respect to those responsibilities delegated to the Fiduciary
Committee hereunder, the Plan shall be administered by the Committee, which
shall be responsible for carrying out the provisions of the Plan.  The Committee shall be a “named fiduciary”
under Section 402(a)(2) of ERISA. 
The Committee shall consist of at least three (3) members who shall
be appointed in the manner authorized by the Board.  Vacancies therein shall be filled in the same
manner as appointments.  Any member of
the Committee may be removed by action of the Board or may resign of his own
accord by delivering his written resignation to the Board and to the secretary
of the Committee.

 

11.2         The members of the Committee shall elect from their number a
chairman.  The chairman shall appoint a
secretary, who need not be a member of the Committee.  The members of the Committee may appoint from
their number subcommittees with such powers as they shall determine, may
authorize one or more of their number or any agent to execute or deliver any
instrument or make any payment in their behalf, and may employ clerks and may
employ such counsel, accountants, and actuaries as may be required in carrying
out the provisions of the Plan.

 

11.3         The Committee shall hold meetings upon such notice, at such time, and at
such place as they may determine.

 

11.4         A majority of the members of the Committee at the time in office shall
constitute a quorum for the transaction of business.  All resolutions or other actions taken by the
Committee shall be by the affirmative vote of a majority of those present at
the meeting, or the written consent of a majority of members at the time in
office, if they act without a meeting.

 

11.5         No member of the Committee who is also an Employee shall receive any
compensation for his services as such, but the Employer may reimburse any member
for any necessary expenses incurred.

 

11.6         The Committee shall from time to time establish rules for the
administration of the Plan and the transaction of its business.  Except as herein otherwise expressly
provided, the Committee shall have the exclusive right to interpret the Plan
and to decide any matters arising thereunder in connection with the
administration of the Plan, the eligibility of any person to benefits
thereunder and the amounts of such benefits. 
It shall endeavor to act by general rules so as not to discriminate
in favor of any person.  Its decisions
and the records of the Committee shall be conclusive and binding upon the
Employer, the Participants, and all other persons having any interest under the
Plan.

 

The Committee shall have the power to amend the
Plan, provided that such amendment does not increase the total cost of
providing benefits under the Plan by an amount in excess of $1,000,000 in any
Plan Year computed in accordance with generally accepted accounting or
actuarial principles; and provided, further, that such amendment does not
affect the duties delegated hereunder to the Fiduciary Committee.

 

35

 

The Committee may appoint a Plan administrator for
the Plan and shall delegate to the Plan administrator the duty to maintain all
records and accounts necessary for the effective administration of the Plan,
and to take any actions necessary to comply with the reporting and disclosure
requirements imposed by the Code, ERISA and any other applicable federal or
state statute or regulation, including any law or regulation promulgated by any
foreign governing body which applies to the Plan.  The Committee may delegate to any Plan
administrator such other duties as it may deem necessary and appropriate.  The Committee shall receive reports from each
such Plan administrator as the Committee may request.

 

11.7         The Committee shall cause to be maintained accounts showing the fiscal
transactions of the Plan, and in connection therewith shall require the Trustee
to submit any necessary reports, and shall keep in convenient form such data as
may be necessary for actuarial valuations of the assets and liabilities of the
Plan.  The Committee may retain counsel,
accountants, actuaries and/or other persons to assist in the discharge of its
duties.

 

11.8         The members of the Committee, the Fiduciary Committee, the Board, and
the officers and directors of the Employer shall be entitled to rely upon all
tables, valuations, certificates, and reports furnished by any duly appointed
actuary, upon all certificates and reports made by any duly appointed
accountant, and upon all opinions given by any duly appointed legal
counsel.  The members of the Committee,
the Fiduciary Committee, the Board, and the officers and directors of the
Employer shall not be held liable for any action taken in good faith in
reliance upon any such tables, valuations, certificates, reports, or
opinions.  All actions so taken shall be
conclusive upon each of them and upon all persons having any interest under the
Plan.  No member of the Committee shall
be personally liable by virtue of any instrument executed by him or on his
behalf as a member of the Committee, or for any mistake of judgment made by
himself or any other member or by anyone employed by the Employer, or for any
loss unless resulting from his own actions, including gross negligence or
willful misconduct.  Each member of the
Committee shall be indemnified by the Employer against losses reasonably
incurred by him in connection with any claim, proceeding or action to which he
may be a party by reason of his membership in the Committee (including amounts
paid in a settlement approved by the Employer and reasonable attorney’s fees
and expenses incurred in connection with such claim, proceeding or action); provided,
however, that such indemnification shall not apply to matters as to
which he shall be finally adjudged, by a court of competent jurisdiction in a
decision from which no appeal may be taken or with respect to which the time to
appeal has expired without an appeal having been made, to have engaged in gross
negligence or willful misconduct.  The
foregoing right of indemnification shall be in addition to any other rights to
which any such member may be entitled as a matter of law or pursuant to the
bylaws of Estee Lauder or any other Employer.

 

11.9         In the event that any Participant, contingent annuitant or Beneficiary
claims to be entitled to a benefit under the Plan, and the Committee determines
that such claim should be denied in whole or in part, the Committee shall, in
writing, notify such claimant within 90 days of receipt of such claim that his
claim has been denied, setting forth the specific reasons for such denial.  Such notification shall be written in a
manner reasonably expected to be understood by such Participant or other payee
and shall set forth the pertinent sections of the Plan relied on and, where
appropriate, an explanation of how the claimant can obtain review of 

 

36

 

such denial. 
Within 60 days after the mailing or delivery by the Committee of such
notice, such claimant may request, by mailing or delivery of written notice to
the Committee, a review by the Committee of the decision denying the
claim.  If the claimant fails to request
such a hearing within such 60-day period, it shall be conclusively determined
for all purposes of this Plan that the denial of such claim by the Committee is
correct.  If such claimant requests a
review within such 60-day period, he shall have the opportunity to review
pertinent documents and to submit a written statement to the Committee.  After such review, the Committee shall
determine whether such denial of the claim was correct and shall notify such
claimant in writing of its determination within 60 days from receipt of his
request and no further review shall thereafter be required by the Committee.

 

37

 

SECTION 12

 

INVESTMENT
OF PLAN ASSETS;

DUTIES
OF FIDUCIARY COMMITTEE

 

12.1         All assets for providing the benefits of the Plan shall be held in trust
for the exclusive benefit of Participants, contingent annuitants and
Beneficiaries under the Plan, and no part of the corpus or income shall be used
for, or diverted to, purposes other than for the exclusive benefit of
Participants, contingent annuitants, and Beneficiaries under the Plan except as
provided in Sections 6.3 and 16.4 hereof. 
No Participant, contingent annuitant, or Beneficiary under the Plan, nor
any other person, shall have any interest in or right to any part of the
earnings of the Trust Fund, or any rights in, to, or under the Trust Fund or
any part of its assets, except to the extent expressly provided in the Plan.

 

12.2         All contributions to the Plan by the Employer shall be committed in
trust to the Trustee and/or to an insurance company as provided for in Section 404
of ERISA.  The Trustee shall be appointed
from time to time by the Fiduciary Committee by the appropriate instrument,
with such powers in the Trustee as to investment, reinvestment, control, and
disbursement of the funds as the Fiduciary Committee shall approve and as shall
be in accordance with the Plan.  The
Fiduciary Committee may remove, replace, or add a Trustee at any time.  Upon the removal, replacement, or resignation
of any Trustee, the Fiduciary Committee may designate a successor Trustee.

 

12.3         In the discretion of the Fiduciary Committee all contributions to the
Plan by the Employer committed to the Trustee and/or insurance company may be
commingled from time to time in whole or in part with any other fund or funds
held by the Trustee and/or insurance company for use in connection with the
payment of pensions of any Employee of the Employer or with any other fund or
funds held by the Trustee and/or insurance company pursuant to any other
retirement plan which is a qualified pension plan under Section 401(a) of
the Code.  For purposes of this Plan, the
word “fund” or “funds” as used in this Section 12 and hereafter in this
Plan shall mean the allocable portion of the fund or funds held by the Trustee
and/or insurance company in respect of the contributions made pursuant to this
Plan.

 

12.4         The Fiduciary Committee shall determine the manner in which the funds of
the Plan shall be disbursed in accordance with the Plan and the provisions of
the trust instrument, including the form of voucher or warrant to be used in
making disbursements and the qualifications of persons authorized to approve
and sign the same and any other matters incident to the disbursement of such
funds.

 

12.5         The Fiduciary Committee shall adopt from time to time actuarial tables
to be used as the basis for all actuarial calculations and shall recommend the
rates of contribution payable by the Employer to the Plan as provided in Section 6
hereof.  The Fiduciary Committee shall
determine from time to time the per centum rate of interest to be used as the
basis for all calculations.  As an aid to
the Fiduciary Committee in adopting tables and in recommending the rates of
contribution payable by the Employer to the Plan, the actuary appointed by the
Fiduciary Committee shall make annual actuarial valuations of the assets and
liabilities of the Plan and 

 

38

 

shall certify to the Fiduciary Committee the tables
and rates of contribution which he would recommend for use by the Fiduciary
Committee.

 

39

 

SECTION 13

 

OBLIGATIONS
OF THE EMPLOYER

 

13.1         All contributions by the Employer for
benefits under the Plan shall be voluntary, and the Employer shall be under no
legal obligation to make and/or continue to make them.  The Employer shall have no liability in
respect to payments or benefits or otherwise under the Plan, and the Employer
shall have no liability in respect to the administration of the Trust Fund or
of the funds, securities, or other assets paid over to the Trustee, and each
Participant, each contingent annuitant, and each Beneficiary shall look solely
to such Trust Fund for any payments or benefits under the Plan.

 

40

 

SECTION 14

 

MISCELLANEOUS
PROVISIONS

 

14.1         Except as otherwise provided by law
(which shall include a “qualified domestic relations order” pursuant to Section 414(p) of
the Code and any other circumstance described in Section 401(a)(13) of the
Code and the Treasury regulations promulgated thereunder), no benefit payable
under the Plan shall be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance, or charge; nor shall any such
benefit be in any manner liable for or subject to the debts, contracts,
liabilities, engagements, or torts of the person entitled to such benefit.

 

14.2         If any Participant, contingent
annuitant, or Beneficiary under the Plan shall become bankrupt or attempt to
anticipate, alienate, sell, transfer, assign, pledge, encumber or charge any
benefit in a manner not allowed pursuant to Section 14.1, then such
benefit shall, in the discretion of the Committee, cease and terminate.  In that event the Committee shall hold or
apply the benefit or any part thereof to or for such Participant, contingent
annuitant or Beneficiary, his spouse, children, or other dependents, or any of
them, in such manner and in such proportions as the Committee shall in its sole
discretion determine.

 

14.3         The establishment and/or maintenance of
the Plan shall not be construed as conferring any rights upon any Employee or
any person for a continuation of employment, and shall not be construed as
limiting in any way the right of the Employer to discharge any Employee or to
treat him without regard to the effect which such treatment might have upon him
as a Participant of the Plan.

 

14.4         If any person entitled to receive any
benefits from the Trust Fund is a minor or, in the judgment of the Committee,
legally, physically or mentally incapable of personally receiving any
distributions, the Committee may instruct the Trustee to make distribution to
such other person, persons, or institutions that, in the judgment of the
Committee, are then maintaining or have custody of such distributee.

 

14.5         The determination of the Committee as
to the identity of the proper payee of any benefit under the Plan and the
amount of such benefit properly payable shall be conclusive, and payment in
accordance with such determination shall constitute a complete discharge of all
obligations on account of such benefit.

 

14.6         In the event any amount shall become
payable from the Trust Fund to a Beneficiary or the estate of any deceased
person and if, after written notice from the Trustee mailed to the last known
address of such Beneficiary, or of the executor or administrator of such estate
(as certified to the Trustee by the Committee), such person or such executor or
administrator shall not have presented himself to the Trustee within two years
after the mailing of such notice, the Trustee shall notify the Committee, and
the Committee shall instruct the Trustee to distribute such amount due to such
Beneficiary or such estate among one or more of the spouse and blood relatives
of such deceased person, as designated by the Committee.

 

41

 

14.7                           This Plan may be adopted, by action of the Board of Directors, with
respect to Employees who are United States citizens employed by a foreign
subsidiary (as defined in Section 3121(1)(8) of the Code) of the
Employer, with such Employees being treated as Employees of an Employer for the
purpose described in Section 406 of the Code if the following conditions
are met:

 

(a)           the Employer has entered into an
agreement under Section 3121(1) of the Code which applies to the
foreign subsidiary by which such Employees are employed; and

 

(b)           no contributions under another funded
plan of deferred compensation (whether or not a plan described in Section 401(a),
403(a), or 405(a) of the Code) are provided by any other Employer with
respect to the remuneration paid to such Employees by such subsidiary.

 

14.8                           In the case of any merger or consolidation with, or transfer of assets
or liabilities to, any other plan each Participant in the Plan will (if the
Plan then terminated) receive a benefit immediately after the merger,
consolidation or transfer which is equal to or greater than the benefit he
would have been entitled to receive immediately before the merger,
consolidation or transfer (if the Plan had then terminated).  Such merger, consolidation or transfer shall
comply with Section 414(l) of the Code and the regulations
promulgated thereunder.

 

14.9                           The rights of any person who terminated employment or retired on or
before the effective date of any of the relevant provisions of this
restatement, including his eligibility for benefits, shall be determined solely
under the terms of the Plan as in effect on the date of his termination of
employment or retirement, unless such person is thereafter reemployed and again
becomes a Participant.

 

14.10                     Notwithstanding
any provision of the Plan to the contrary, contributions, benefits and service
credit with respect to qualified military service will be provided in
accordance with Section 414(u) of the Code.

 

42

 

SECTION 15

 

ADOPTION
OF PLAN BY MEMBERS OF THE GROUP

 

15.1         Any member of the Group, other than
Estee Lauder, or any other corporation or unincorporated trade or business
which is not a member of the Group may, with the consent of the Board of
Directors, adopt this Plan, thereby bringing such Group member or other
corporation or unincorporated trade or business within the definition of
Employer.  With respect to such member of
the Group or other corporation or unincorporated trade or business, the term “Original
Effective Date” of the Plan shall refer to the date as to which such member
adopts the Plan or the date as of which the Plan is extended to such member as
the case may be.

 

15.2         The Board of Directors shall, subject
to the requirements of ERISA and the Code, determine the extent to which, if at
all, the period of employment prior to the extension of the Plan to a member of
the Group or other corporation or unincorporated trade or business shall be
recognized for purposes of the Plan.

 

15.3         In the event that a retirement plan or
pension plan maintained by a member of the Group, or other corporation or
unincorporated trade or business, for any other division, plant, or location is
added to this Plan, the rights and benefits of Employees who were covered under
such other plan shall, from and after the Original Effective Date of the Plan
with respect to said Employer, be determined under such terms and conditions
with respect to such Employees as shall be specified by the Board of Directors
in the resolution approving the adoption or extension of the Plan as to the
said Employees.

 

The assets under such other plans maintained by a
member of the group applicable to Employees to be covered by this Plan shall,
to the extent practicable and subject to the provisions of Section 14.8
hereof, be transferred to the Fund under this Plan, and such transferred assets
shall be merged with the Fund held under this Plan.

 

15.4         If any Employer which has come within
the definition of Employer pursuant to this Section 15 subsequently
withdraws or is withdrawn from the Plan, or discontinues the Plan with respect
to all or part of its Employees, the Committee shall determine the share of the
Fund which shall be allocated to the Employees of such Employer who are thereby
affected.  If a separate defined benefit
pension plan is being continued for such Employees, such Employer shall,
subject to the provisions of Section 14.8 hereof, designate a successor
Trustee under a separate instrument to whom such allocable funds shall be
transferred with respect to all or the specified classifications of its
Employees, as the case may be, unless the Board of Directors shall determine
that such Employer and its affected Employees may upon proper action of such
Employer continue to participate in the Trust Fund maintained in connection
with this Plan.  If the Plan is
discontinued with respect to all or part of such Employer’s Employees, such
allocable funds shall be allocated with respect to each Employee affected, and
shall be applied pursuant to Section 16.4 hereof.

 

15.5         If any Employer which is not a member
of the Group which includes Estee Lauder adopts the Plan in accordance with Section 15.1,
the Plan shall be treated as a “multiple 

 

43

 

employer plan” within the meaning of Section 413(c) of
the Code, and it shall comply with all the requirements of the Code and ERISA
applicable to such plans.

 

44

 

SECTION 16

 

AMENDMENT
AND TERMINATION

 

16.1                           Estee Lauder reserves the right at any time, and from time to time, by
action of the Committee to amend, in whole or in part, retroactively or
prospectively or both, any or all of the provisions of the Plan; provided,
however, that no part of the assets of the Plan shall, by reason of any
amendment, be used for or diverted to purposes other than for the exclusive
benefit of Participants, contingent annuitants, and Beneficiaries; and further
provided that any amendment adopted by the Committee which would cause the Plan
and the trust established under the Plan to cease to meet the requirements of Section 401(a) or
501(a) of the Code respectively, shall be null and void; and any actions
taken under the Plan pursuant to such amendment, any benefit increases (or
decreases) accruing under the Plan as a result of such amendment, and any
increases (or decreases) in benefit payments under the Plan made as a result of
such amendment, during the period from the date of adoption of such amendment
to the date it is determined that such amendment should so cause the Plan and
the trust under the Plan to cease to meet such requirements, shall be,
respectively, rectified, nullified, and restored as soon as possible to the
extent necessary to permit the Plan and the trust under the Plan to continue to
meet the requirements of Section 401(a) and 501(a) of the Code,
respectively.  Notwithstanding the previous paragraph herein, no amendment to the Plan
shall:

 

(a)           reduce the Participant’s accrued
normal retirement income as of the date on which the amendment is adopted,

 

(b)           eliminate or reduce any early
retirement benefit or retirement-type subsidy (to be determined by regulation),
or an optional form of retirement income under the Plan, with respect to the
accrued normal retirement income, or

 

(c)           reduce a retired Participant’s
retirement income as of the beginning of the Plan Year in which the amendment
is effective.

 

The Board of Directors’ approval shall be required
for any amendment to the Plan which is anticipated by the Committee to increase
the cost to Estee Lauder of maintaining the Plan by an amount in excess of
$1,000,000 in any Plan Year, computed in accordance with generally accepted
accounting or actuarial principles.

 

16.2                           The Board of Directors may terminate the Plan at any time as to all or
any particular group or groups of Participants and such other persons, if any,
who have or may become entitled to benefits under the Plan on account of such
Participants as to whom the Plan shall have been terminated, which Participants
and other persons shall be referred to collectively as the terminated group in
this Section 16.  After the Plan
termination date which is applicable to the terminated group, benefits shall be
provided to the terminated group in accordance with Section 16.4
hereof.  In the event of such
termination, each member of the terminated group will be fully (100%) vested in
his accrued benefit.

 

16.3                           The terminated group’s portion of the Fund shall equal the sum of that
part of the fair market value on the Plan termination date of the entire Fund
that would have been 

 

45

 

allocated to each person in the terminated group in
accordance with Section 16.4 hereof if the Plan had been terminated on
such date as to all Participants in the Plan and no expenses were incurred in
connection with such termination of the Plan.

 

16.4                           A terminated group’s share of the Fund shall be allocated as follows:

 

(a)           first, to provide benefits to each
person in the terminated group in accordance with Section 4044(a) of
ERISA, and the regulations issued pursuant thereto;

 

(b)           then, to the extent that after the
making of the allocation described in (a) above, there remain in the Fund
any assets which are applicable to the terminated group, the said assets shall be
applied to pay for any unpaid administrative expenses for the administration of
the Plan as to the terminated group; and

 

(c)           lastly, to the extent that after
making the allocations described in (a) and (b) above, there remain
in the Fund any assets which are applicable to the terminated group, then such
remaining assets shall be paid to the Employer for its own use and benefit
provided that such payment to the Employer does not contravene any provision of
law.

 

46

 

SECTION 17

 

LIMITATION
ACCORDING TO

TREASURY DEPARTMENT REQUIREMENTS

 

The purpose of this Section is to conform the
Plan to the requirements of Section 1.401(a)(4)-5(b) of the Income
Tax Regulations.

 

17.1         If a benefit becomes or is payable for
a Plan Year to a Participant who is among the 25 highest paid “highly
compensated employees” or “highly compensated former employees” (each as
defined in Section 414(q) of the Code and regulations and rulings
issued thereunder) for a Plan Year, such benefit cannot exceed an amount equal
to the payments that would be made during the Plan Year on behalf of the
Participant under a single life annuity that is the Actuarial Equivalent of the
sum of the Participant’s Accrued Benefit and any other benefits under the Plan;
provided, however, that this Section shall not apply if (i) benefits
that would be payable to such a Participant are less than one percent (1%) of
the total value of current liabilities under the Plan, or (ii) the assets of
the Trust Fund exceed, immediately after payment of a benefit to such a
Participant, 110% of the value of current liabilities under the Plan.  (For purposes of this Section, the value of
current liabilities shall be as defined in Section 412(l)(7) of the
Code.)

 

17.2         In the event of a termination of the
Plan, the benefit of any highly compensated employee or highly compensated
former employee shall be limited to a benefit that is nondiscriminatory under Section 401(a)(4) of
the Code.

 

17.3         In the event Congress should provide by
statute, or the Internal Revenue Service or Department of the Treasury should
provide by regulation or ruling, that such limitations are no longer necessary
for the Plan to meet the requirements of Section 401(a) or other
applicable provisions of the Code then in effect, such limitations shall become
void and shall no longer apply, without the necessity of further amendment to
the Plan.

 

47

 

SECTION 18

 

TOP-HEAVY
PLAN PROVISIONS

 

18.1         Anything elsewhere in this Plan to the
contrary notwithstanding, the provisions of this Section 18 shall apply to
the Plan for any Plan Year if, on the last day of the preceding Plan Year,
either (i) the present equivalent actuarial value of the cumulative
accrued normal retirement income of Key Employees exceeds 60% of the present
equivalent actuarial value of the cumulative accrued normal retirement income
of all Participants, or (ii) the sum of (A) the present equivalent
actuarial value of the cumulative accrued normal retirement income of Key
Employees under the Plan, (B) the present equivalent actuarial value of
the accumulated accrued benefits of Key Employees under all other qualified
defined benefit plans included in the Aggregation Group, and (C) the
cumulative account balances of Key Employees under all qualified defined
contribution plans included in the Aggregation Group exceeds 60% of the sum of (D) the
present equivalent actuarial value of the cumulative accrued normal retirement
income of all Participants under the Plan, (E) the present equivalent
actuarial value of the accumulated accrued benefits of all Participants under
all other qualified defined benefit plans included in the Aggregation Group,
and (F) the cumulative account balances of all Participants under all qualified
defined contribution plans included in the Aggregation Group.  For the purpose of the foregoing sentence,
the “equivalent actuarial value” of the cumulative accrued normal retirement
income of each Participant under the Plan shall be calculated utilizing a five
percent (5%) interest rate assumption and is increased by the amount of the
aggregate distributions, if any, made with respect to the Participant under the
Plan during the five-year period ending on the last day of the preceding Plan
Year (except that for Plan Years beginning on or after January 1, 2002,
distributions on account of severance from employment, death or disability
shall be taken into account only if made during the one-year period ending on
the last day of the preceding Plan Year); and the present equivalent actuarial
value of the accumulated accrued benefit of each Participant under all other
qualified defined benefit plans and the cumulative account balances of each
Participant under any qualified defined contribution plan shall be increased by
the amount of the aggregate distributions, if any, made with respect to the
Participant under such other plan during that five-year period (or one-year
period, as applicable).  The term “Aggregation
Group” shall mean all plans to which the Employer contributes in which a Key
Employee is a Participant and all other plans to which the Employer contributes
that enable any such plan to meet the requirements of Section 401(a)(4) or
Section 410 of the Code.  If a
Participant is not a Key Employee for any Plan Year, but was a Key Employee in
a prior Plan Year, the accrued normal retirement income for such Participant
shall not be taken into account.  The
accrued normal retirement income of any Participant or former Participant who
has not during the five-year period ending on the last day of the preceding
Plan Year received from the Employer any compensation other than benefits under
the Plan (or for determinations on or after January 1, 2002, who has not
during the one-year period ending on the last day of the preceding Plan Year
performed any services for the Employer) shall not be taken into account.  In any Plan Year for which the provisions of
this Section 18 apply and thereafter, each Employee who is a Participant
during that Plan Year and has completed at least three (3) Years of
Service shall have a nonforfeitable right, in the event he ceases to be an
Employee prior to his Normal Retirement Date, otherwise than by death or early
retirement, to receive for the remainder of his life (beginning at his Normal
Retirement Date if he is still living) a deferred vested retirement

 

48

 

income in an amount per month equal to his accrued
normal retirement income computed as of the date he ceases to be an Employee
(including benefits accrued before the provisions of this Section 18
apply).

 

Notwithstanding the foregoing, each such Employee
who has completed not less than three (3) Years of Service shall be
permitted to elect, within 90 days after the first day of the Plan Year for
which the provisions of this Section 18 apply, to have his nonforfeitable
percentage computed in accordance with the provisions of Section 8 hereof
without regard to this paragraph.

 

18.2                           In any Plan Year for which the provisions of this Section 18 apply,
if the accrued normal retirement income of any Participant who is not a Key
Employee, when expressed as an equivalent actuarial value of a benefit payable
annually in the form of a single life annuity (with no ancillary benefits) beginning
when the Participant attains age 65 (without taking into account contributions
or benefits under Chapter 2 of Chapter 21 of Title II of the Social Security
Act, or any other Federal or State law), is less than the Compensation from
Estee Lauder not in excess of $150,000 ($200,000 for Plan Years beginning on or
after January 1, 2002), for years in the Participant’s Testing Period,
then the accrued normal retirement income of that Participant shall be
increased to an amount equal at the last day of that Plan Year to such
Applicable Percentage of the Participant’s average Compensation from the
Employer for years in the Participant’s Testing Period.

 

18.3                           In any Plan Year for which the provisions of this Section 18 apply,
the Compensation from the Employer of each Participant taken into account under
the Plan shall not exceed the first $150,000 ($200,000 for Plan Years beginning
on or after January 1, 2002) (or such other figure as shall result from
such annual cost-of-living adjustments as the Secretary of the Treasury or his
delegate shall make pursuant to Section 401(a)(17)(B) of the Code).

 

18.4                           In any Plan Year commencing prior to January 1, 2000 for which the
provisions of this Section 18 apply, the figure “1.0” shall be substituted
for the figure “1.25” as required by Section 416 of the Code for the
purpose of determining an Employee’s “defined contribution plan fraction” and “defined
benefit plan fraction” under Section 415(e) of the Code.

 

18.5                           For purposes of this Section, the following definitions shall apply:

 

(a)           “Applicable Percentage” means, in
respect of any Participant, the lesser of (i) 2 percent multiplied by the
number of the Participant’s Years of Service (disregarding any Year of Service
in which ended a Plan Year for which the provisions of this Section 18
were not applicable and any Year of Service completed in a Plan Year beginning
before January 1, 1984) or (ii) 20 percent.

 

(b)           “Compensation” means, for purposes of
this Section only, Compensation as defined in Section 2.10 hereof but
including any special pay or remuneration reportable to the Internal Revenue
Service on Form W-2 for Federal income tax purposes, but with respect to
Plan Years commencing prior to January 1, 1998, “Compensation” excludes
contributions made by an Employer on behalf of an Employee under a “cash or
deferred arrangement” described in Section 401(k) of the Code.

 

49

 

(c)           “Key Employee” means a Participant,
former Participant or the contingent annuitant of any Participant who, at any
time during the Plan Year or, for determinations prior to January 1, 2002,
any of the four preceding Plan Years, is or was

 

(i)            an officer of an Employer whose
compensation from the Employer for the Plan Year exceeds (A) for
determinations prior to January 1, 2002, 50% of the dollar limitation in
effect under Section 415(b)(1)(A) of the Code for the calendar year
in which such Plan Year ends, or (B) for determinations on or after January 1,
2002, $130,000;

 

(ii)           solely for determinations prior to January 1,
2002, one of the ten employees having annual compensation from the Employer in
excess of the limitation in effect under Section 415(c)(1)(A) of the
Code and owning (or considered as owning within the meaning of Section 318
of the Code) the largest interests in the Employer;

 

(iii)          the owner of five percent (5%) or more
of the outstanding stock of the Employer (or stock possessing more than five
percent (5%) of the total combined voting power of all stock of the Employer);
or

 

(iv)          an owner of one percent (1%) or more
of the outstanding stock of the Employer (or stock possessing more than one
percent (1%) of the total combined voting power of all stock of the Employer)
whose Compensation from the Employer for the Plan Year is more than
$150,000.  Any Employee who is not a Key
Employee shall be deemed a Non-Key Employee.

 

(d)           “Testing Period” means, in respect of
any Participant, the period of consecutive years (not exceeding five (5)), and
disregarding any Year of Service in which ended a Plan Year for which the
provisions of this Section 18 were not applicable, any Year of Service
completed in a Plan Year beginning before January 1, 1984, and any year
that begins after the close of the last Plan Year for which the provisions of
this Section 18 were applicable), during which the Participant had the
greatest aggregate Compensation from the Employer.

 

50

 

SECTION 19

 

FUNDING-BASED
LIMITS ON BENEFITS AND BENEFIT ACCRUALS

 

19.1         Funding-based Limitation on Shutdown
Benefits and Other Unpredictable 
Contingent Event Benefits.

 

(a)           If
any Participant is entitled to an unpredictable contingent event benefit
payable with respect to any event occurring during any Plan Year, such benefit
shall not be provided if the adjusted funding target attainment percentage for
such Plan Year is—

 

(i)            is less than 60 percent; or

 

(ii)           would be less than 60 percent taking
into account such occurrence.

 

(b)           Section 19.1(a) shall
cease to apply with respect to any Plan Year, effective as of the first day of
the Plan Year, upon payment by the Employer of a contribution (in addition to
any minimum required contribution under Section 430 of the Code) equal to—

 

(i)            in the case of clause (a)(i) above,
the amount of the increase in the funding target of the Plan (under Section 430
of the Code) for the Plan Year attributable to the occurrence referred to in
subsection (a) above, and

 

(ii)           in the case of clause (a)(ii), the
amount sufficient to result in a funding target attainment percentage of 60
percent.

 

19.2         Limitations on Plan Amendments
Increasing Liability for Benefits.

 

(a)           No
amendment to the Plan which has the effect of increasing liabilities of the
Plan by reason of increases in benefits, establishment of new benefits,
changing the rate of benefit accrual, or changing the rate at which benefits
become nonforfeitable may take effect during any Plan Year if the adjusted funding
target attainment percentage for such Plan Year is—

 

(i)            less than 80 percent; or

 

(ii)           would be less than 80 percent taking
into account such amendment.

 

(b)           Section 19.2(a) shall
cease to apply with respect to any Plan Year, effective as of the first day of
the Plan Year (or if later, the effective date of the amendment), upon payment
by the Employer of a contribution (in addition to any minimum required
contribution under Section 430 of the Code) equal to—

 

51

 

(i)            in the case of clause (a)(i) above,
the amount of the increase in the funding target of the Plan (under Section 430
of the Code) for the Plan Year attributable to the amendment, and

 

(ii)           in the case of clause (a)(ii), the
amount sufficient to result in an adjusted funding target attainment percentage
of 80 percent.

 

(c)           Section 19.2(a) shall
not apply to any amendment which provides for an increase in benefits under a
formula which is not based on a Participant’s compensation, but only if the
rate of such increase is not in excess of the contemporaneous rate of increase
in average wages of Participants covered by the amendment.

 

19.3         Limitations on Accelerated Benefit
Distributions.

 

(a)           In
any case in which the Plan’s adjusted funding target attainment percentage for
a Plan Year is less than 60 percent, the Plan shall not pay any prohibited
payment (as defined in Section 19.3(d) below) after the valuation
date for the Plan Year.

 

(b)           During
any period in which any Employer is a debtor in a case under title 11, United
States Code, or similar Federal or State law, the Plan shall not pay any
prohibited payment.  The preceding
sentence shall not apply on or after the date on which the enrolled actuary of
the Plan certifies that the adjusted funding target attainment percentage of
the Plan is not less than 100 percent.

 

(c)           In
any case in which the Plan’s adjusted funding target attainment percentage for
a Plan Year is 60 percent or greater but less than 80 percent, the Plan shall
not pay any prohibited payment after the valuation date for the Plan Year to
the extent that the amount of the payment exceeds the lesser of—

 

(i)            50 percent of the amount of the
payment which could be made without regard to this Section 19; or

 

(ii)           the present value (determined under
guidance prescribed by the Pension Benefit Guaranty Corporation, using the
interest and mortality assumptions under Section 417(e) of the Code)
of the maximum guarantee with respect to the Participant under Section 4022
of ERISA.

 

Only one prohibited payment meeting the
requirements of this Section 19.3(c) shall be made with respect to
any Participant during any period of consecutive Plan Years to which the
limitations under either Section 19.3(c)(i) or (ii) applies.  For purposes of this one payment per
Participant limitation, a Participant and any Beneficiary on his behalf
(including for this purpose an alternate payee) shall be treated as one
Participant.  If the accrued benefit of a
Participant is allocated to such an alternate payee and one or more other
persons, the amount under this Section 19.3(c) shall be allocated
among such persons in the same manner as the accrued benefit is allocated
unless the qualified domestic relations order provides otherwise.

 

(d)           For
purposes of this Section 19.3, a “prohibited payment” means—

 

52

 

(i)            any payment, in excess of the
monthly amount paid under a single life annuity (plus any social security
supplements described in the last sentence of Section 411(a)(9) of
the Code), to a Participant or Beneficiary whose annuity starting date (as
defined in Section 417(f)(2) of the Code) occurs during any period a
limitation under this Section 19.3 is in effect;

 

(ii)           any payment for the purchase of an
irrevocable commitment from an insurer to pay benefits; and

 

(iii)          any other payment specified by the
Secretary of the Treasury in regulations.

 

19.4         Limitation on Benefit Accruals In the
Event of a Severe Funding Shortfall.

 

(a)           In
any case in which the Plan’s adjusted funding target attainment percentage for
a Plan Year is less than 60 percent, benefit accruals under the Plan shall
cease as of the valuation date for the Plan Year.

 

(b)           Section 19.4(a) shall
cease to apply with respect to any Plan Year, effective as of the first day of
the Plan Year, upon payment by the Employer of a contribution (in addition to
any minimum required contribution under Section 430 of the Code) equal to
the amount sufficient to result in an adjusted funding target attainment
percentage of 60 percent.

 

53

 

SECTION 20

 

EXECUTION

 

To record the amendment and restatement of the Plan
as set forth herein, the Estee Lauder Inc. Employee Benefits Committee has
adopted this restatement effective as of January 1, 2007 and authorized
its execution below.

 

 

	
   

  	
  ESTEE LAUDER INC. EMPLOYEE BENEFITS COMMITTEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Amy DiGeso, Chairman

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
				

 

54

 

APPENDIX
A

 

1.             Except
as otherwise noted below, the assumptions to be used to convert a single life
annuity into any other form of benefit, other than a lump sum distribution, are
as follows:

 

	
  Interest Rate:

  	
   

  	
  6%

  
	
   

  	
   

  	
   

  
	
  Mortality Table:

  	
   

  	
  1971 TPF&C Mortality Table for male lives,
  set back four years

  

 

2.             To
the extent that (A) any Participant’s Retirement Account is to be
converted into an equivalent, immediately payable, annual amount of single life
annuity and (B) the distribution of such single life annuity is to begin
as of date prior to January 1, 1999, such conversion shall be done by
applying an immediate conversion factor to such Participant’s Retirement
Account, with such factor based upon the above specified mortality table and
the Pension Benefit Guaranty Corporation (“PBGC”) immediate interest rate
applicable to the month as of which the distribution of the single life annuity
is otherwise to begin.

 

To the extent that (A) any
Participant’s Retirement Account is to be converted into an equivalent,
immediately payable, annual amount of single life annuity and (B) the
distribution of such single life annuity is to begin as of date during calendar
year 1999, such conversion shall be done by applying an immediate conversion
factor to such Participant’s Retirement Account, with such factor based upon
the “applicable mortality table” (as defined under Section 417(e)(3) of
the Code) and whichever of the following two interest rates results in the
larger single life annuity:

 

(i)                                     the “applicable interest rate” (as defined under Section 417(e)(3) of
the Code) as in effect for the second calendar month immediately prior to the
first day of the calendar quarter in which falls the date as of which the
distribution of the single life annuity is otherwise to begin, and

 

(ii)                                  such same “applicable interest rate” as in effect for the second
calendar month immediately prior to the month in which falls the date as of
which such distribution of the single life annuity is otherwise to begin.

 

To the extent that (A) any Participant’s
Retirement Account is to be converted into an equivalent, immediately payable,
annual amount of single life annuity and (B) the distribution of such
single life annuity is to begin as of a date on or after January 1, 2000,
such conversion shall be done by applying an immediate conversion factor to
such Participant’s Retirement Account, with such factor based upon the “applicable
mortality table” (as defined under Section 417(e)(3) of the Code) and
the “applicable interest rate” (as defined under Section 417(e)(3) of
the Code) as in effect for the second calendar month immediately prior to the
first day of the calendar quarter in which falls the date as of which the
distribution of the single life annuity is otherwise to begin.

 

A-1

 

For purposes of this Appendix A, the “applicable
mortality table” (as defined under Section 417(e)(3) of the Code)
shall be the table prescribed by Revenue Ruling 95-6 for distributions on or
after January 1, 1999 and prior to December 31, 2002, and the table
prescribed by Revenue Ruling 2001-62 for distributions on or after December 31,
2002 and prior to January 1, 2008, and the table prescribed by Revenue
Ruling 2007-67 for distributions on or after January 1, 2008 (except to
the extent that sections 4 and 5 of this Appendix A permit use on or after January 1,
2008 of a table determined without giving effect to the changes in Section 417(e)(3) of
the Code made by the Pension Protection Act of 2006 (“PPA 2006”)).

 

3.             To
the extent that (A) any immediately payable, lump sum distribution under
the Plan is the equivalent of a single life annuity otherwise deferred to a
Participant’s Normal Retirement Date and (B) such distribution is to occur
as of a date prior to January 1, 1999, such Participant’s Retirement
Account is converted into an annual amount of such a deferred single life
annuity using a deferred conversion factor, with such factor based upon the
above specified mortality table and the PBGC immediate/deferred blended
interest rate (under Section 417(e)(3) of the Code, as in effect
immediately prior to the enactment of Public Law 103-465) applicable to the
month as of which the distribution of such lump sum benefit is otherwise to
occur.

 

To the extent that (A) any immediately
payable, lump sum distribution under the Plan is the equivalent of a single
life annuity otherwise deferred to a Participant’s Normal Retirement Date and (B) such
distribution is to occur as of a date during calendar year 1999, such
Participant’s Retirement Account is converted into an annual amount of such a
deferred single life annuity using a deferred conversion factor, with such
factor based upon the “applicable mortality table” (as defined under Section 417(e)(3) of
the Code) and whichever of the following two interest rates results in the larger
single life annuity:

 

(i)                                     the “applicable interest rate” (as defined under Section 417(e)(3) of
the Code) as in effect for the second calendar month immediately prior to the
first day of the calendar quarter in which falls the date as of which such distribution
is otherwise to occur, and

 

(ii)                                  such same “applicable interest rate” as in effect for the second
calendar month immediately prior to the month in which falls the date as of
which such distribution is otherwise to occur.

 

To the extent that (A) any immediately
payable, lump sum distribution under the Plan is the equivalent of a single
life annuity otherwise deferred to a Participant’s Normal Retirement Date and (B) such
distribution is to occur as of a date on or after January 1, 2000, such
Participant’s Retirement Account is converted into an annual amount of such a
deferred single life annuity using a deferred conversion factor, with such
factor based upon the “applicable mortality table” (as defined under Section 417(e)(3) of
the Code) and the applicable interest rate” (as defined under Section 417(e)(3) of
the Code) as in effect for the second calendar month immediately prior to the
first day of the calendar quarter in which falls the date as of which such
distribution is otherwise to occur.

 

A-2

 

4.             To
the extent that (A) any Participant’s single life annuity otherwise
payable immediately is converted into an equivalent, immediately payable lump
sum distribution and (B) the distribution of such lump sum benefit is to
occur as of a date prior to January 1, 1999, such conversion shall be done
by applying an immediate conversion factor to the annual amount of such single
life annuity, with such factor based upon the above specified mortality table and
the PBGC immediate interest rate applicable to the month as of which the
distribution of such lump sum benefit is otherwise to occur.

 

To the extent that (A) any Participant’s
single life annuity otherwise payable immediately is converted into an equivalent,
immediately payable lump sum distribution and (B) the distribution of such
lump sum benefit is to occur as of a date during calendar year 1999, such
conversion shall be done by applying an immediate conversion factor to the
annual amount of such single life annuity, with such factor based upon the “applicable
mortality table” (as defined under Section 417(e)(3) of the Code) and
whichever of the following two interest rates results in the larger single life
annuity:

 

(i)                                     the “applicable interest rate” (as defined under Section 417(e)(3) of
the Code) as in effect for the second calendar month immediately prior to the
first day of the calendar quarter in which falls the date as of which such
distribution is otherwise to occur, and

 

(ii)                                  such same “applicable interest rate” as in effect for the second
calendar month immediately prior to the month in which falls the date as of
which such distribution is otherwise to occur.

 

To the extent that (A) any Participant’s
single life annuity otherwise payable immediately is converted into an
equivalent, immediately payable lump sum distribution and (B) the
distribution of such lump sum benefit is to occur as of a date on or after January 1,
2000 and prior to January 1, 2008, such conversion shall be done by
applying an immediate conversion factor to the annual amount of such single
life annuity, with such factor based upon the “applicable mortality table” (as
defined under Section 417(e)(3) of the Code) and the “applicable
interest rate” (as defined under Section 417(e)(3) of the Code) as in
effect for the second calendar month immediately prior to the first day of the
calendar quarter in which falls the date as of which such distribution is
otherwise to occur.

 

To the extent that (A) any Participant’s
single life annuity otherwise payable immediately is converted into an
equivalent, immediately payable lump sum distribution and (B) the
distribution of such lump sum benefit is to occur as of a date on or after January 1,
2008, such conversion shall be done by applying to the annual amount of such
single life annuity the immediate conversion factor specified in clause (i) or
(ii) below that produces the greater lump sum benefit amount: (i) the
factor based upon the “applicable mortality table” and “applicable interest rate”
determined in accordance with the immediately preceding paragraph, without
giving effect to the changes in Section 417(e)(3) of the Code made by
PPA 2006; or (ii) the factor based upon the “applicable mortality table”
(as defined under Section 417(e)(3) of the Code as amended by PPA
2006) and the “applicable interest rate” (as defined under Section 417(e)(3) of
the Code as amended by PPA 2006) as in effect for the second calendar month

 

A-3

 

immediately prior to the first day of the calendar
quarter in which falls the date as of which such distribution is otherwise to
occur.

 

5.             Each
Participant’s single life annuity otherwise deferred to such Participant’s
Normal Retirement Date is, if the distribution of a lump sum benefit is
otherwise to occur as of a date prior to January 1, 1999, converted into
an equivalent, immediately payable lump sum distribution by using a deferred
conversion factor, with such factor based upon the above specified mortality
table and the PBGC immediate/deferred blended interest rate (under Section 417(e)(3) of
the Code, as in effect immediately prior to the enactment of Public Law
103-465) applicable to the month as of which the distribution of such lump sum
benefit is otherwise to occur.

 

Each Participant’s single life annuity otherwise
deferred to such Participant’s Normal Retirement Date is, if the distribution
of a lump sum benefit is otherwise to occur as of a date during calendar year
1999, converted into an equivalent, immediately payable lump sum distribution
by using a deferred conversion factor, with such factor based upon the “applicable
mortality table” (as defined under Section 417(e)(3) of the Code) and
whichever of the following two interest rates results in the larger single life
annuity:

 

(i)                                     the “applicable interest rate” (as defined under Section 417(e)(3) of
the Code) as in effect for the second calendar month immediately prior to the
first day of the calendar quarter in which falls the date as of which such
distribution is otherwise to occur, and

 

(ii)                                  such same “applicable interest rate” as in effect for the second
calendar month immediately prior to the month in which falls the date as of
which such distribution is otherwise to occur.

 

Each Participant’s single life annuity otherwise
deferred to such Participant’s Normal Retirement Date is, if the distribution
of a lump sum benefit is otherwise to occur as of a date on or after January 1,
2000 and prior to January 1, 2008, converted into an equivalent,
immediately payable lump sum distribution by using a deferred conversion
factor, with such factor based upon the “applicable mortality table” (as
defined under Section 417(e)(3) of the Code) and the “applicable
interest rate” (as defined under Section 417(e)(3) of the Code) as in
effect for the second calendar month immediately prior to the first day of the
calendar quarter in which falls the date as of which such distribution is
otherwise to occur.

 

Each Participant’s single life annuity otherwise
deferred to such Participant’s Normal Retirement Date shall be, if the
distribution of a lump sum benefit is otherwise to occur as of a date on or
after January 1, 2008, converted into an equivalent, immediately payable
lump sum distribution by using the deferred conversion factor specified in
clause (i) or (ii) below that produces the greater lump sum benefit
amount: (i) the factor based upon the “applicable mortality table” and “applicable
interest rate” determined in accordance with the immediately preceding
paragraph, without giving effect to the changes in Section 417(e)(3) of
the Code made by PPA 2006; or (ii) the factor based upon the “applicable
mortality table” (as defined under Section 417(e)(3) of the Code as
amended by PPA 2006) and the “applicable interest rate” (as defined under Section 417(e)(3) of
the Code as amended by PPA 2006) as in effect for the

 

A-4

 

second calendar month immediately prior to the
first day of the calendar quarter in which falls the date as of which such
distribution is otherwise to occur.

 

A-5

 

APPENDIX
B

 

In order to receive the benefits described in Section 5.5
of the Plan, a Participant must have been a participant under a Prior Plan on December 31,
1990 and must satisfy the requirements set forth below that correspond to his
termination of employment date.

 

	
  Termination of Employment Date

  	
   

  	
  Requirements

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  After December 31, 1990 and prior to
  July 1, 1991

  	
   

  	
  1.

  	
   

  	
  Age 50 with 10 Years of Service on
  December 31, 1990; age 55 with 10 Years of Service on his termination of
  employment date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  After June 30, 1991 and prior to
  January 1, 1993

  	
   

  	
  2.

  	
   

  	
  Age 55 with 10 Years of Service on his
  termination of employment date

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  After December 31, 1992

  	
   

  	
  3.

  	
   

  	
  Age 50 with 5 Years of Service, or any age and 10
  Years of Service, as of January 1, 1993

  

 

B-1

 

APPENDIX C

 

ADDITIONAL
EARLY RETIREMENT BENEFITS

 

1.1           Eligibility for Additional Benefits

 

A.            Any Participant employed in the United States by an Employer, or on sick
leave or long-term disability under the Employer’s Long-Term Disability Plan,
may elect to retire on August 1, 1991 (such designated date of retirement
hereinafter referred to in this Appendix C as the “Retirement Day”) and be
eligible to receive the additional benefits (“Additional Benefits”) set forth
under this Appendix C, provided that (i) on or before July 31, 1991
such Participant shall have attained at least age 55 and completed at least ten
Years of Service under the Plan (including periods of disability in which no Years
of Service were credited), (ii) the document entitled “Special Retirement
Option Agreement,” which includes a General Release in favor of the Employer,
is signed, witnessed and dated no earlier than July 8, 1991 but no later
than July 18, 1991 in strict accordance with the instructions contained
therein, and (iii) such Participant shall have made an election to retire
on such other forms as the Employer may require during the period commencing
forty-five days after such Participant receives the “Special Retirement Option
Agreement” from the Employer but ending no later than July 31, 1991.  Participants who previously retired on or
after January 1, 1991 and before August 1, 1991 and who were employed
in the United States by the Employer shall also be eligible for the Additional
Benefits under this Appendix C, provided the preceding requirements in clauses
(i)-(iii) hereof are satisfied.

 

B.            Notwithstanding the provisions of paragraph A hereof, any individual
whose active employment with an Employer ceased by mutual agreement on or
before May 17, 1991 shall not be eligible for any benefits under this
Appendix C.

 

C.            Notwithstanding the provisions of paragraph A above, any individual who
is classified by an Employer as a Corporate Department Head or President of a
division shall not be eligible for the Additional Benefits under this Appendix
C.

 

1.2           Additional Benefits

 

Each Participant eligible for Additional Benefits
under this Appendix C to the Plan who elects to retire on the Retirement Day
shall be entitled to the following:

 

A.            The Additional Benefits shall be equal to the benefit determined, under Section 5.5
of the Plan, by increasing the Participant’s age as of August 1, 1991, by
five (5) years and Years of Service as of August 1, 1991, by five (5) years.  The Additional Benefits shall be added to the
regular pension benefit determined under Section 5.5 of the Plan.

 

B.            The reduction contained in Section 5.5 of the Plan, which applies
to the early commencement of a Participant’s benefits prior to age 62, shall be
applied after increasing the Participant’s age by five (5) years as
provided under paragraph A above.

 

C-1

 

C.            The Additional Benefits provided under this Appendix C to the Plan shall
be payable in the form applicable to the Participant in accordance with the
provisions of Section 9 of the Plan.

 

D.            Participants who (i) retired on or after January 1, 1991 and
prior to August 1, 1991, (ii) are receiving retirement benefits under
the Plan prior to August 1, 1991, and (iii) are eligible under Section 1.1
A hereof, shall have the amount of their retirement benefits recomputed under
this Appendix C from the date of their previous retirement and paid in
accordance with the form of benefit previously elected under Section 9 of
the Plan.  No changes to the form of
benefit previously elected shall be permitted; however, the Additional Benefits
payable for the period of time from the date of the previous retirement to July 31,
1991 shall be paid in the form of a lump sum distribution at the time
prescribed under paragraph E hereof.  In
no event shall Additional Benefits be paid to Participants who retired before January 1,
1991.

 

E.             If a Participant elects the Additional Benefits provided under this
Appendix C to the Plan, such Participant’s retirement benefits shall be payable
commencing in the first month following the month in which the Retirement Day
occurs.

 

C-2

 

APPENDIX
D

 

ADDITIONAL EARLY RETIREMENT BENEFITS

 

1.1           Eligibility
for Additional Benefits

 

A.            Any
Participant employed in the Commonwealth of Puerto Rico by the Estee Lauder
Hemisphere Division of Clinique (the “Employer”), or on sick leave or long-term
disability under the Employer’s Long-Term Disability Plan, may elect to retire
on December 1, 1991 (such designated date of retirement hereinafter
referred to in this Appendix D as the “Retirement Day”) and be eligible to
receive the additional benefits (“Additional Benefits”) set forth under this
Appendix D, provided that (i) on or before November 30, 1991 such
Participant shall have attained at least age 55 and completed at least ten
Years of Service under the Plan (including periods of disability in which no
Years of Service were credited), (ii) the document entitled “Special
Retirement Option Agreement and General Release,” which includes a General
Release in favor of the Employer, is signed, witnessed and dated no earlier
than November 4, 1991 but no later than November 14, 1991 in strict
accordance with the instructions contained therein, and (iii) such
Participant shall have made an election to retire on such other forms as the
Employer may require during the period commencing forty-five days after such
Participant receives the “Special Retirement Option Agreement” from the
Employer but ending no later than November 30, 1991.  Participants who previously retired on or
after January 1, 1991 and before December 1, 1991 and who were
employed in the Commonwealth of Puerto Rico by the Employer shall also be
eligible for the Additional Benefits under this Appendix D, provided the
preceding requirements in clauses (i)-(iii) hereof are satisfied.

 

B.            Notwithstanding
the provisions of paragraph A hereof, any individual whose active employment
with the Employer ceased by mutual agreement on or before September 19,
1991 shall not be eligible for any benefits under this Appendix D.

 

C.            Notwithstanding
the provisions of paragraph A above, any individual who is classified by the
Employer as a Corporate Department Head or President of a division shall not be
eligible for the Additional Benefits under this Appendix D.

 

1.2           Additional
Benefits

 

Each Participant eligible for Additional Benefits
under this Appendix D to the Plan who elects to retire on the Retirement Day
shall be entitled to the following:

 

A.            The
Additional Benefits shall be equal to the benefit determined, under Section 5.5
of the Plan, by increasing the Participant’s age as of December 1, 1991,
by five (5) years and Years of Service as of December 1, 1991, by
five (5) years.  The Additional
Benefits shall be added to the regular pension benefit determined under Section 5.5
of the Plan.

 

B.            The
reduction contained in Section 5.5 of the Plan, which applies to the early
commencement of a Participant’s benefits, shall be applied after increasing the
Participant’s age by five (5) years as provided under paragraph A above.

 

D-1

 

C.            The
Additional Benefits provided under this Appendix D to the Plan shall be payable
in the form applicable to the Participant in accordance with the provisions of Section 9
of the Plan.

 

D.            Participants
who (i) retired on or after January 1, 1991 and prior to December 1,
1991, (ii) are receiving retirement benefits under the Plan prior to December 1,
1991, and (iii) are eligible under Section 1.1 A hereof, shall have
the amount of their retirement benefits recomputed under this Appendix D from
the date of their previous retirement and paid in accordance with the form of
benefit previously elected under Section 8 of the Plan.  No changes to the form of benefit previously
elected shall be permitted; however, the Additional Benefits payable for the
period of time from the date of the previous retirement to November 30,
1991 shall be paid in the form of a lump sum distribution at the time
prescribed under paragraph E hereof.  In
no event shall Additional Benefits be paid to Participants who retired before January 1,
1991.

 

E.             If
a Participant elects the Additional Benefits provided under this Appendix D to
the Plan, such Participant’s retirement benefits shall be payable commencing in
the first month following the month in which the Retirement Day occurs.

 

D-2

 

APPENDIX
E

 

SPECIAL PROVISIONS GOVERNING 

EMPLOYEES OF WHITMAN PACKAGING CORPORATION

WHO DID NOT OTHERWISE BECOME ELIGIBLE EMPLOYEES

PRIOR TO JANUARY 1, 1992

 

SECTION 1.1                         SCOPE.

 

The provisions of this Appendix E shall apply with
respect to each person who first became an employee of Whitman Packaging
Corporation prior to January 1, 1992; other than any such person who,
prior to that date, terminated such employment and immediately thereupon
transferred to, and became an employee of, an entity which was then an Employer
under the Plan as then in effect (a “Whitman Employee”).  The provisions of this Appendix E shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall (except with reference to the first sentence of the preceding
paragraph) be to the Plan as in effect at the time such provision is applied to
a Whitman Employee, as the context shall require.

 

The provisions of this Appendix E shall not apply
with respect to (a) any person described in Appendix F or (b) any
person who first becomes an employee of Whitman Packaging Corporation (“Whitman”)
on or after January 1, 1992.

 

SECTION 1.2                         COMMENCEMENT OF STATUS AS A PARTICIPATING EMPLOYER

 

Whitman shall become an Employer under the Plan on January 1,
1992.

 

SECTION 1.3                         COMMENCEMENT OF PLAN PARTICIPATION BY WHITMAN EMPLOYEES

 

No Whitman Employee shall be permitted to become a
Participant prior to January 1, 1992. 
The first date on or after January 1, 1992 on which any such person
may become a Participant shall be governed by the otherwise applicable
provisions of Section 3 of the Plan. 
In applying the terms of such participation eligibility provision, there
shall be taken into account all of such Whitman Employee’s period of employment
with Whitman on or after January 1, 1984, but only to the extent that any
such period of employment would have been taken into account had Whitman otherwise
been an Employer throughout such person’s entire such period of employment.

 

E-1

 

SECTION 1.4                         CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the
Retirement Account of a Whitman Employee who becomes a Participant pursuant to
the provisions of Section 5 of the Plan, there shall be taken into account
all periods of such person’s employment with Whitman on or after January 1,
1984 which would otherwise have been taken into account for such purpose had
Whitman otherwise been an Employer throughout such person’s entire such period
of employment; provided, however, that there shall be taken into
account for this purpose with respect to any Whitman Employee who becomes a
Participant (i) who transferred from a non-exempt position to an exempt
position prior to January 1, 1992, all periods of employment beginning
with the date on which such Whitman Employee first became a regular, full-time
employee of Whitman; (ii) who is in a non-exempt position, all periods of
employment beginning on the later of (A) January 1, 1984, or (B) such
Whitman Employee’s Plan Entry Date for purposes of the Whitman Packaging
Corporation Money Purchase Plan.

 

SECTION 1.5                         VESTING

 

In determining the extent to which any Whitman
Employee is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s
employment with Whitman which are otherwise taken into account with respect to
such employee pursuant to the provisions of Section 1.4 of this Appendix
E.

 

E-2

 

APPENDIX
F

 

SPECIAL PROVISIONS GOVERNING

EMPLOYEES OF WHITMAN PACKAGING
CORPORATION

WHO OTHERWISE BECOME ELIGIBLE
EMPLOYEES

PRIOR TO JANUARY 1, 1992

 

SECTION 1.1                         SCOPE

 

The provisions of this Appendix F shall apply with
respect to each person who, prior to January 1, 1992, (a) became an
employee of Whitman Packaging Corporation and (b) thereafter terminated
such employment and immediately thereupon transferred to, and became an
employee of an entity which was then an Employer under the Plan as then in
effect (a “Transferred Whitman Employee”). 
The provisions of this Appendix F shall apply notwithstanding any
contrary provisions of the Plan, of which this Appendix is a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall (except with reference to the first sentence of the preceding
paragraph) be to the Plan as in effect at the time such provision is applied to
a Transferred Whitman Employee, as the context shall require.

 

The provisions of this Appendix F shall not apply
with respect to (a) any person subject to the provisions of Appendix E or (b) any
person who first becomes an employee of Whitman Packaging Corporation (“Whitman”)
on or after January 1, 1992.

 

SECTION 1.2                         CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the Retirement
Account of a Transferred Whitman Employee for the Plan Year commencing January 1,
1992 and for each subsequent Plan Year (but not for any prior Plan Year)
pursuant to the provisions of Section 5 of the Plan, but only in the case
of such a person who is otherwise entitled to have an amount so credited for
such Plan Year, there shall be taken into account all periods of such person’s
employment with Whitman on or after January 1, 1984 which would otherwise
have been taken into account for such purpose had Whitman otherwise been an
Employer throughout such person’s entire such period of employment; provided,
however, that there shall be taken into account for this purpose with
respect to any Transferred Whitman Employee (i) who transferred from a non-exempt
position to an exempt position with Whitman prior to becoming a Transferred
Whitman Employee, all periods of employment beginning with the date on which
such Transferred Whitman Employee first became a regular, full-time employee of
Whitman; (ii) who was in a non-exempt position with Whitman prior to
becoming a Transferred Whitman Employee, all periods of employment beginning on
the later of (iii) January 1, 1984, or (iv) such Transferred
Whitman Employee’s Plan Entry Date for purposes of the Whitman Packaging
Corporation Money Purchase Plan.

 

F-1

 

SECTION 1.3                         VESTING

 

In determining the extent to which any Transferred
Whitman Employee is, for the Plan Year commencing January 1, 1992 and each
subsequent Plan Year, vested in his Retirement Account pursuant to the
provisions of Section 8 of the Plan, there shall be taken into account all
periods of such person’s employment with Whitman which are otherwise taken into
account with respect to such employee pursuant to the provisions of Section 1.2
of this Appendix F.

 

In determining the extent to which any Transferred
Whitman Employee is, for any Plan Year beginning prior to January 1, 1992,
vested in such aforementioned Account, such person’s prior employment with
Whitman shall be taken into account only to the extent required under the
provisions of Section 411 of the Code.

 

F-2

 

APPENDIX
G

 

SPECIAL PROVISIONS GOVERNING

EMPLOYEES OF NORTHTEC INC. WHO DID NOT OTHERWISE

BECOME ELIGIBLE EMPLOYEES PRIOR TO JANUARY 1, 1992

 

SECTION 1.1                                                  SCOPE

 

The provisions of this Appendix G shall apply with
respect to each person who first became an employee of Northtec Inc. prior to January 1,
1992 at either its Trevose, Pa. or Bristol, Pa. locations; other than any such
person who, prior to that date, terminated such employment and immediately
thereupon transferred to, and became an employee of, an entity which was then
an Employer under the Plan as then in effect (a “Northtec Employee”).  The provisions of this Appendix G shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall (except with reference to the first sentence of the preceding
paragraph) be to the Plan as in effect at the time such provision is applied to
a Northtec Employee, as the context shall require.

 

The provisions of this Appendix G shall not apply
with respect to (a) any person described in Appendix H or (b) any
person who first becomes an employee of Northtec Inc. (“Northtec”) on or after January 1,
1992.

 

SECTION 1.2                                                  COMMENCEMENT OF STATUS AS A PARTICIPATING EMPLOYER

 

Northtec shall become an Employer under the Plan on
January 1, 1992.

 

SECTION 1.3                                                  COMMENCEMENT OF PLAN PARTICIPATION BY NORTHTEC EMPLOYEES

 

A.                                   No
Northtec Employee shall be permitted to become a Participant prior to January 1,
1992.  The first date on or after January 1,
1992 on which any such person may become a Participant shall be governed by the
otherwise applicable provisions of Section 2 of the 1992 Plan.

 

B.                                     In
applying the terms of the participation eligibility provision referred to in
subsection (a) of this Section 1.3 in the case of any Northtec
Employee employed at the Trevose, Pa. location prior to January 1, 1992,
there shall be taken into account all of such employee’s period of employment
with Northtec on or after July 17, 1989, but only to the extent that any
such period of employment would have been taken into account had Northtec
otherwise been an Employer throughout such person’s entire such period of
employment.

 

G-1

 

C.                                     In
applying the terms of the participation eligibility provision referred to in Section 1.3
in the case of any Northtec Employee employed at the Bristol, Pa. location prior
to January 1, 1992, there shall be taken into account all of such employee’s
period of employment with Northtec (including, for such purpose, all periods of
employment on and after November 1, 1987, with Powder Masters, which
formerly operated such location), but only to the extent that any such period
of employment would have been taken into account had Northtec (or Powder
Masters, as the case may be) otherwise been an Employer throughout such person’s
entire such period of employment.

 

SECTION 1.4                                                  CREDITS TO RETIREMENT ACCOUNTS

 

A.                                   In determining the amount to be credited to the Retirement Account of a
Northtec Employee who becomes a Participant pursuant to the provisions of Section 5
of the Plan, on behalf of any Northtec Employee employed at the Trevose, Pa.
location prior to January 1, 1992, who otherwise becomes a Participant,
there shall be taken into account all periods of such person’s employment with
Northtec on or after July 17, 1989 which would otherwise have been taken
into account for such purpose had Northtec otherwise been an Employer
throughout such person’s entire such period of employment.

 

B.                                     In determining the amount to be credited to the Retirement Account of a
Northtec Employee who becomes a Participant pursuant to the provisions of Section 5
of the Plan, on behalf of any Northtec Employee employed at the Bristol, Pa.
location prior to January 1, 1992, who otherwise becomes a Participant,
there shall be taken into account all periods of such person’s employment with
Northtec (including, for such purpose, all periods of employment on and after November 1,
1987, with Powder Masters) which would otherwise have been taken into account
for such purpose had Northtec (or Powder Masters, as the case may be) otherwise
been an Employer throughout such person’s entire such period of employment.

 

C.                                     In addition to the credits referred to in subsections (b) and (c) of
this Section 1.4, each Northtec Employee who becomes a Participant on January 1,
1992 shall, as of such date, be credited with $400 for each full calendar year
of employment prior to January 1, 1992, but with such calendar years being
limited to the period otherwise taken into account under the foregoing
provisions of this Section 1.4.

 

SECTION 1.5                                                  VESTING

 

In determining the extent to which any Northtec
Employee is vested in his Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s
employment with Northtec which are otherwise taken into account with respect to
such employee pursuant to the provisions of Section 1.4 of this Appendix
G.

 

G-2

 

SECTION 1.6                                                  TRANSFER BETWEEN LOCATIONS

 

In the case of any Northtec Employee who, prior to January 1,
1992 had been employed at both the Trevose, Pa. location and the Bristol, Pa.
location, the provisions of this Appendix G shall, notwithstanding any other
provision of this Appendix G to the contrary, be applied as if such person had,
throughout the entire period prior to January 1, 1992, remained employed
at whichever of such two locations such Northtec Employee was first employed.

 

G-3

 

APPENDIX
H

 

SPECIAL PROVISIONS GOVERNING

EMPLOYEES OF NORTHTEC INC. WHO
OTHERWISE BECOME

ELIGIBLE EMPLOYEES PRIOR TO
JANUARY 1, 1992

 

SECTION 1.1                                                  SCOPE

 

The provisions of this Appendix H shall apply with
respect to each person who, prior to January 1, 1992, (a) became an
employee of Northtec Inc. at either its Trevose, Pa. or Bristol, Pa. locations
and (b) thereafter terminated such employment and immediately thereupon
transferred to, and became an employee of an entity which was then an Employer
under the Plan as then in effect (a “Transferred Northtec Employee”).  The provisions of this Appendix H shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall (except with reference to the first sentence of the preceding
paragraph) be to the Plan as in effect at the time such provision is applied to
a Transferred Northtec Employee, as the context shall require.

 

The provisions of this Appendix H shall not apply
with respect to (a) any person subject to the provisions of Appendix G or (b) any
person who first becomes an employee of Northtec Inc. (“Northtec”) on or after January 1,
1992.

 

SECTION 1.2                                                  CREDITS TO RETIREMENT ACCOUNTS

 

A.                                   In determining the amount to be credited to the Retirement Account of a
Transferred Northtec Employee, who was employed at the Trevose, Pa. location
prior to becoming a Transferred Northtec Employee, for the Plan Year commencing
January 1, 1992 and for each subsequent Plan Year (but not for any prior
Plan Year) pursuant to the provisions of Section 5 of the Plan, but only
in the case of such a person who is otherwise entitled to have an amount so
credited for such Plan Year, there shall be taken into account all periods of
such person’s employment with Northtec on or after July 17, 1989 which
would otherwise have been taken into account for such purpose had Northtec
otherwise been an Employer throughout such person’s entire such period of
employment.

 

B.                                     In determining the amount to be credited to the Retirement Account of a
Transferred Northtec Employee, who was employed at the Bristol, Pa. location
prior to becoming a Transferred Northtec Employee, for the Plan Year commencing
January 1, 1992 and for each subsequent Plan Year (but not for any prior
Plan Year) pursuant to the provisions of Section 5 of the Plan, but only
in the case of such a person who is otherwise entitled to have an amount so
credited for such Plan Year, there shall be taken into account all periods of
such person’s employment with Northtec (including, for such purpose, all
periods of employment on and after November 1, 1987, with Powder Masters)
which would otherwise have been taken into account 

 

H-1

 

for such purpose had Northtec (or Powder Masters,
as the case may be) otherwise been an Employer throughout such person’s entire
such period of employment.

 

C.                                     In addition to the credits referred to in subsections (b) and (c) of
this Section 1.2, each Transferred Northtec Employee who was otherwise a
Participant in the Plan on January 1, 1992, shall, as of such date, be
credited with the greater of (a) the balance otherwise determined under
the Plan as of that date, without regard to this Appendix H or (b) an
amount equal to the sum of $400 multiplied by the number of such person’s full
calendar years of employment prior to January 1, 1992.  For this purpose, such calendar years of
employment for any Transferred Northtec Employee shall be determined by taking
into account all periods of employment otherwise taken into account with
respect to such person under the foregoing provisions of this Section 1.2
as well as all periods otherwise recognized under the Plan without regard to
this Appendix H.

 

SECTION 1.3                                                  VESTING

 

In determining the extent to which any Transferred
Northtec Employee is, for the Plan Year commencing January 1, 1992 and
each subsequent Plan Year, vested in his Retirement Account pursuant to the
provisions of Section 8 of the Plan, there shall be taken into account all
periods of such person’s employment with Northtec which are otherwise taken
into account with respect to such employee pursuant to the provisions of Section 1.2
of this Appendix H.

 

In determining the extent to which any Transferred
Northtec Employee is, for any Plan Year beginning prior to January 1,
1992, vested in such aforementioned Account, such person’s prior employment
with Northtec shall be taken into account only to the extent required under the
provisions of Section 411 of the Code.

 

SECTION 1.4                                                  TRANSFER BETWEEN LOCATIONS

 

In the case of any Transferred Northtec Employee
who, prior to so becoming a Transferred Northtec Employee, had been employed at
both the Trevose, Pa. location and the Bristol, Pa. location, the provisions of
this Appendix H shall, notwithstanding any other provisions of this Appendix H
to the contrary, be applied as if such person had, throughout the entire period
prior to becoming a Transferred Northtec Employee, remained employed at
whichever of such two locations such person was first employed.

 

H-2

 

APPENDIX
I

 

ADDITIONAL RETIREMENT BENEFITS

 

SECTION 1.1                                                  Eligibility for Additional Benefits

 

The following Participants shall receive the
additional benefits provided pursuant to this Appendix I:

 

	
  NAME

  	
   

  	
  SOCIAL SECURITY NO.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (OMITTED)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

SECTION 1.2                                                  Additional Benefits

 

Each Participant described in the foregoing Section 1.1
of this Appendix I shall be entitled to the following:

 

A.                                   The Additional Benefits shall be equal to the benefit determined, under Section 5.5
of the Plan, by increasing the Participant’s age by five (5) years and
Years of Credited Service by five (5) years.  The Additional Benefits shall be added to the
regular pension benefit determined under Section 5.5 of the Plan.

 

B.                                     The reduction contained in Section 5.5 of the Plan, which applies
to the early commencement of a Participant’s benefits, shall be applied after
increasing the Participant’s age by five (5) years as provided under paragraph
A above.

 

C.                                     The Additional Benefits provided under this Appendix I shall be payable
in the form otherwise applicable to the Participant in accordance with the
generally applicable provisions of the Plan.

 

I-1

 

APPENDIX
J

 

ADDITIONAL EARLY RETIREMENT
BENEFITS - II

 

1.1                                 Eligibility for Additional Benefits.

 

(1)                                  Any
Participant who is (i) employed by the Employer, (ii) on an Approved
Absence (paid or unpaid) from the Employer, (iii) on sick leave or long-term
disability under the Employer’s Long-Term Disability Plan with disability
payments continuing on and after January 1, 1997 or (iv) receiving
severance payments from the Employer that are being paid on or after January 1,
1997 (such persons being hereinafter referred to as a “Covered Employee”), may
elect to retire on the first day of any month commencing on January 1,
1997 and ending on July 1, 1998 as designated by the Employer and Covered
Employee in the “General Release” (such designated date of retirement
hereinafter referred to in this Appendix J as the “Retirement Date”).

 

Such Covered Employee shall be eligible to receive
the benefit described in Paragraph 1.2 of this Appendix J, provided that (i) on
or before December 31, 1996, such Covered Employee shall have attained at
least age 50 and completed at least ten Years of Service or Years of Credited
Service under the Plan, (ii) on or before December 31, 1996, any such
Covered Employee who was employed by Whitman Packaging Corporation has completed
at least four Years of Eligibility Service under the Plan, (iii) the
document entitled “Special Retirement Opportunity” is signed, witnessed and
dated no earlier than November 8, 1996 in strict accordance with the
instructions contained therein, and (iv) such Covered Employee shall have
made an election to retire on such other forms as the Employer may require
during the period commencing at least forty-five days after such Covered
Employee receives the “General Release” from the Employer but ending no later
than June 4, 1998.  Participants who
previously retired on or after January 1, 1996 and before January 1,
1997 and who were employed in the United States by the Employer shall also be
eligible for the benefits described in Paragraph 1.2 of this Appendix J,
provided the preceding requirements in clauses (i)-(iv) hereof are
satisfied (such persons are hereinafter referred to as “Retired Covered
Employees”).

 

(2)                                  Notwithstanding
the provisions of paragraph 1 above, any individual who is classified by an
Employer as a Corporate Department Head or President of a division shall not be
eligible for the benefit described in Paragraph 1.2 of this Appendix J.

 

1.2                                 Additional Benefits.

 

(1)                                  Each
Covered Employee who elects to retire on the Retirement Date shall be entitled
to his Accrued Benefit which will be calculated as if such Covered Employee was
five years older than his actual age as of December 31, 1996, and by
increasing his Years of Service and Years of Credited Service as of December 31,
1996 (the difference between the Covered Employee’s benefit determined under
this Appendix J and his benefit determined without regard to the enhancement
provided under this Appendix J shall hereinafter be referred to as the “Additional
Benefit”).

 

J-1

 

(2)                                  The
reduction contained in Section 5.5 of the Plan, which applies to the early
commencement of a Covered Employee’s Accrued Benefit determined under the terms
of the Prior Plan, shall be applied after increasing the Covered Employee’s age
by five (5) years as provided under Paragraph 1.2(1) above.

 

(3)                                  If
the Covered Employee elects to retire pursuant to the provisions of this
Appendix J, such Covered Employee may elect at any time prior to the date of
commencement of his benefit to receive his benefit, calculated in accordance
with the provisions of the Plan and this Appendix J, in the forms of payment
applicable to the Covered Employee in accordance with the provisions of Section 9
of the Plan.

 

(4)                                  All
Retired Covered Employees who (i) retired on or after January 1, 1996
and prior to January 1, 1997 and (ii) are receiving retirement
benefits under the Plan prior to January 1, 1997 shall have the amount of
their retirement benefits recomputed under this Appendix J (taking into the
account the provisions of paragraphs (1) and (2) hereof) from the
date of their previous retirement and paid in accordance with the form of
benefit previously elected under Section 9 of the Plan.  No changes to the form of benefit previously elected
shall be permitted.  In no event shall
Additional Benefits be paid to Participants who retired before January 1,
1996.

 

(5)                                  If
a Covered Employee or Retired Covered Employee elects to receive the Additional
Benefits provided under this Appendix J to the Plan, such Covered Employee’s or
Retired Covered Employee’s retirement benefits shall be payable with respect to
or commencing on the first month following the month in which the Retirement
Date occurs.

 

1.3                                 Defined Terms.

 

Except to the extent set forth above, the
provisions of this Appendix J are subject to the terms and conditions of the
Plan and defined terms used in this Appendix J shall have the same meaning as
used in the Plan.

 

J-2

 

APPENDIX
K

 

SPECIAL PROVISIONS GOVERNING

EMPLOYEES OF BOBBI BROWN
PROFESSIONAL

COSMETICS, INC. WHO DID NOT
OTHERWISE

BECOME ELIGIBLE EMPLOYEES

 

SECTION 1.1                                                  SCOPE

 

The provisions of this Appendix K shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall (except with reference to the first sentence of the preceding
paragraph) be to the Plan as in effect at the time such provision is applied to
a Bobbi Brown Employee (as defined below), as the context shall require.

 

SECTION 1.2                                                  COMMENCEMENT OF STATUS AS A PARTICIPATING EMPLOYER

 

Bobbi Brown Professional Cosmetics, Inc. (“Bobbi
Brown”) shall become an Employer under the Plan on January 1, 1996.

 

SECTION 1.3                                                  COMMENCEMENT OF PLAN PARTICIPATION BY BOBBI BROWN EMPLOYEES

 

No Bobbi Brown employee shall be permitted to
become a Participant prior to January 1, 1996.  Each person who (i) is employed by Bobbi
Brown on January 1, 1996 and (ii) is otherwise an Employee on that
date shall become a Participant on January 1, 1996.  (Each
person who so becomes a Participant on that date is hereafter referred to as a “Bobbi
Brown Employee”.)

 

SECTION 1.4                                                  CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the
Retirement Account of a Bobbi Brown Employee who becomes a Participant,
pursuant to the provisions of Section 5 of the Plan, such person’s Years
of Service, for such purpose, shall be determined based upon the date that such
person would otherwise have, without regard to this Appendix K, first become a
Participant had Bobbi Brown been an Employer throughout such person’s entire
period of employment with Bobbi Brown.

 

K-1

 

SECTION 1.5                                                  VESTING

 

In determining the extent to which any Bobbi Brown
Employee is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, such person’s Years of Service, for such purpose, shall be
determined by taking into account all periods of such person’s employment with
Bobbi Brown which would otherwise have been taken into account for such purpose
had Bobbi Brown otherwise been an Employer throughout such person’s entire
period of employment with Bobbi Brown.

 

K-2

 

APPENDIX
L

 

SPECIAL PROVISIONS GOVERNING

ESTEE LAUDER EMPLOYEES WHO WERE
PREVIOUSLY

EMPLOYED BY THE DONNA KARAN
COMPANY

WHO DID NOT OTHERWISE

BECOME ELIGIBLE EMPLOYEES

 

SECTION 1.1                                             SCOPE

 

The provisions of this Appendix L shall apply with
respect to each person who was an employee of The Donna Karan Company (“DK”)
immediately prior to November 10, 1997 and becomes an Employee prior to December 31,
1998 (a “DK Employee”).  The provisions
of this Appendix L shall apply notwithstanding any contrary provisions of the
Plan, of which this Appendix is a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
a DK Employee, as the context shall require.

 

SECTION 1.2                                             COMMENCEMENT OF PLAN PARTICIPATION BY DK EMPLOYEES

 

No DK Employee shall be permitted to become a
Participant prior to November 10, 1997. 
The first date on or after November 10, 1997 on which any such
person may become a Participant shall be governed by the otherwise applicable
provisions of Section 3 of the Plan. 
In applying the terms of such participation eligibility provision, there
shall be taken into account all of such DK Employee’s period of employment with
DK, but only to the extent that any such period of employment would have been
taken into account had DK otherwise been an Employer throughout such person’s
entire period of employment with DK.

 

SECTION 1.3                                             CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the
Retirement Account of a DK Employee who becomes a Participant pursuant to the
provisions of Section 5 of the Plan, there shall be taken into account all
periods of such person’s employment with DK which would otherwise have been
taken into account for such purpose had DK otherwise been an Employer
throughout such person’s entire such period of employment.

 

SECTION 1.4                                             VESTING

 

In determining the extent to which any DK Employee
is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s
employment with DK which are otherwise taken into account with respect to such
employee pursuant to the provisions of Section 1.4 of this Appendix L.

 

L-1

 

APPENDIX
M

 

SPECIAL PROVISIONS GOVERNING

CERTAIN TRANSFERRED EMPLOYEES

 

SECTION 1.1                                             SCOPE

 

The provisions of this Appendix M shall apply with
respect to each person (i) who was an employee of one of the companies
listed below on or after the date specified below for such company, and (ii) whose
employment is subsequently transferred from such company to an Employer (each a
“Transferred Employee”):

 

	
  Company

  	
   

  	
  Date

  
	
  Make-Up Art Cosmetics
  Inc.

  Make-UP Art Cosmetics
  (U.S.) Inc.,

  FFJD, Inc.

  	
   

  	
  December 28, 1994

  
	
  Sassaby
  Cosmetics, Inc.

  	
   

  	
  October 31, 1997

  
	
  Aveda Corporation

  Aveda Services Inc.

  	
   

  	
  December 1,1997

  

 

The provisions of the Appendix M shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
a Transferred Employee, as the context shall require.

 

SECTION 1.2                                             COMMENCEMENT OF PLAN PARTICIPATION BY TRANSFERRED EMPLOYEES

 

The first date on which any Transferred Employee
may become a Participant shall be governed by the otherwise applicable
provisions of Section 3 of the Plan. 
In applying the terms of such participation eligibility provision, there
shall be taken into account all of such Transferred Employee’s period of
employment with his prior employer listed in Section 1.1 of this Appendix
M (including any corporate predecessor thereof), but only to the extent that
any such period of employment would have been taken into account had such prior
employer otherwise been an Employer throughout such person’s entire period of
employment.

 

M-1

 

SECTION 1.3                                             CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the
Retirement Account of a Transferred Employee who becomes a Participant pursuant
to the provisions of Section 5 of the Plan, there shall be taken into
account all periods of such person’s employment with his prior employer listed
in Section 1.1 of this Appendix M (including any corporate predecessor
thereof) which would otherwise have been taken into account for such purpose
had such prior employer otherwise been an Employer throughout such person’s
entire such period of employment.

 

SECTION 1.4                                             VESTING

 

In determining the extent to which any Transferred
Employee is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s
employment with his prior employer listed in Section 1.1 of this Appendix
M (including any corporate predecessor thereof) which would otherwise have been
taken into account for such purpose had such prior employer otherwise been an
Employer throughout such person’s entire period of employment.

 

M-2

 

APPENDIX N

 

PROVISIONS GOVERNING

CERTAIN EMPLOYEES OF

MAKE-UP ART COSMETICS INC. AND

ITS AFFILIATES AND PREDECESSORS

 

SECTION 1.1                                             SCOPE

 

The provisions of this Appendix N to the Estee
Lauder Inc. Retirement Growth Account Plan shall apply with respect to each
person employed by Make-Up Art Cosmetics Inc., Make-Up Art Cosmetics (U.S.), Inc.,
FFJD, Inc., or their respective predecessors (collectively, the “MAC
Companies”) on December 31, 1999 (“MAC Employee”).

 

The provisions of this Appendix N shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
a MAC Employee, as the context shall require.

 

SECTION 1.2                                             COMMENCEMENT OF STATUS AS PARTICIPATING EMPLOYER

 

Make-Up Art Cosmetics Inc., Make-Up Art Cosmetics
(U.S.), Inc., and FFJD, Inc. shall become Participating Employers
under the Plan on January 1, 2000.

 

SECTION 1.3                                             COMMENCEMENT OF PLAN PARTICIPATION BY MAC EMPLOYEES

 

No MAC Employee shall be permitted to become a
Participant prior to January 1, 2000. 
Each MAC Employee who is regularly scheduled to work twenty hours or
more per week as of December 31, 1999, may become a Participant in the
Plan on January 1, 2000, notwithstanding any otherwise applicable
provisions of Section 3 of the Plan. 
Each other MAC Employee may become a Participant in the Plan on the
first applicable entry date on or after January 1, 2000, in accordance
with the provisions of Section 3 of the Plan; however, for purposes of
determining eligibility under the Plan, there shall be taken into account all
periods attributable to such person’s employment with the MAC Companies, prior
to December 31, 1999, that would otherwise have been taken into account
for such purpose had such prior employer otherwise been an Employer throughout
such person’s entire period of employment. 
Any other individual who becomes actively employed by the MAC Companies
on or after January 1, 2000, may become a Participant of the Plan on the
first applicable entry date on or after January 1, 2000, in accordance
with the provisions of Section 3 of the Plan.

 

N-1

 

SECTION 1.4                                             CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the
Retirement Account of a MAC Employee who becomes a Participant pursuant to the
provisions of Section 5 of the Plan, there shall be taken into account all
periods of such person’s employment with the MAC Companies that would otherwise
have been taken into account for such purpose had such prior employer otherwise
been an Employer throughout such person’s entire period of employment.

 

SECTION 1.5                                             VESTING

 

In determining the extent to which any MAC Employee
is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s employment
with the MAC Companies that would otherwise have been taken into account for
such purpose had such prior employer otherwise been an Employer throughout such
person’s entire period of employment.

 

N-2

 

APPENDIX O

 

ADDITIONAL EARLY RETIREMENT
BENEFIT - III

 

SECTION 1.1                                             ELIGIBILITY FOR ADDITIONAL BENEFITS

 

(1)                                 Any
Participant who is a non-exempt Employee in Manufacturing, Engineering,
Distribution and Quality Assurance at the Melville Complex or the Oakland, New
Jersey facility and is either (i) actively employed by the Employer, or (ii) on
an Approved Absence (paid or unpaid) from the Employer, (each such person being
hereinafter referred to as a “Covered Employee”), may elect to retire on
May 1, 2000, as designated by the Employer and Covered Employee in the “General
Release” (such designated date of retirement hereinafter referred to in this
Appendix O as the “Retirement Date”).

 

Such Covered Employee shall be eligible to
receive the benefit described in Section 1.2 of this Appendix O,
provided that (i) on or before April 30, 2000, such Covered Employee
shall have attained at least age 55 and completed at least ten Years
of Service or Years of Credited Service under the Plan, (ii) the document
entitled “Special Retirement Opportunity” is signed, witnessed and dated no
earlier than March 10, 2000, in strict accordance with the instructions
contained therein and (iii) such Covered Employee shall have made an
election to retire on such other forms as the Employer may require during the
period commencing at least forty-five days after such Covered Employee
receives the “General Release” from the Employer but ending no later than
April 24, 2000.  Individuals who
would have been Covered Employees but for the fact that they previously retired
on or after January 1, 2000, and before May 1, 2000, shall also be
eligible for the benefits described in Section 1.2 of this
Appendix O, provided the requirements in clauses (i) and (ii) of
this paragraph are satisfied (such persons are hereinafter referred to as “Retired
Covered Employees”).

 

SECTION 1.2                                             ADDITIONAL BENEFITS

 

(1)                                 Each
Covered Employee who elects to retire on the Retirement Date shall be entitled
to his Accrued Benefit which will be calculated as if such Covered Employee was
five (5) years older than his actual age as of April 30, 2000, and by
increasing by five (5) years his Years of Service and Years of Credited
Service as of April 30, 2000, (the difference between the Covered Employee’s
benefit determined under this Appendix O and his benefit determined
without regard to the enhancement provided under this Appendix O shall
hereinafter be referred to as the “Additional Benefit”).

 

(2)                                 The
reduction contained in Section 5.5 of the Plan, which applies to the early
commencement of a Covered Employee’s Accrued Benefit determined under the terms
of the Prior Plan, shall be applied after increasing the Covered Employee’s age
by five (5) years as provided under Section 1.2(1) above.

 

(3)                                 If
the Covered Employee elects to retire pursuant to the provisions of this
Appendix O, such Covered Employee may elect at any time prior to the date
of commencement of his Additional Benefit to receive such benefit, calculated
in accordance with the provisions of the 

 

O-1

 

Plan and this Appendix O, in any of the
forms of payment applicable to the Covered Employee in accordance with the
provisions of Section 9 of the Plan. 
Notwithstanding the foregoing, in the case of a Covered Employee whose
Additional Benefit is computed by reference to Section 5.6 of the Plan,
such Covered Employee may elect to receive such Additional Benefit in the form
of a lump sum distribution or any other form of payment allowed under Section 9
of the Plan.

 

(4)                                 If
a Covered Employee elects to retire and receive the Additional Benefit provided
under this Appendix O to the Plan, such Covered Employee’s retirement
benefits shall be payable commencing on the first day of the first month
coincident with or next following the date on which the Covered Employee
retires.

 

(5)                                 All
Retired Covered Employees shall have the amount of their retirement benefits
computed under this Appendix O (taking into account the provisions of
paragraphs (1) and (2) of this Section 1.2) as of May 1,
2000, and such amount shall be paid in accordance with the form of benefit
previously elected under Section 9 of the Plan.  No changes to the form of benefit previously
elected shall be permitted except to the extent necessary to permit a Retired
Covered Employee whose Additional Benefit is calculated by reference to Section 5.6
of the Plan to elect a lump sum distribution under paragraph (3) of this Section 1.2.  In no event shall Additional Benefits be paid
to Participants who retired prior to January 1, 2000.

 

SECTION 1.3                                             DEFINED TERMS

 

Except to the extent set forth above, the
provisions of this Appendix O are subject to the terms and conditions of
the Plan and capitalized terms not otherwise defined in this Appendix O
shall have the same meaning as used in the Plan.

 

O-2

 

APPENDIX P

 

PROVISIONS GOVERNING

CERTAIN EMPLOYEES OF

STILA COSMETICS, INC. AND

ITS AFFILIATES AND PREDECESSORS

 

SECTION 1.1                                             SCOPE

 

The provisions of this Appendix P to the Estee
Lauder Inc. Retirement Growth Account Plan shall apply with respect to each
person employed by Stila Cosmetics, Inc. or its predecessor on December 31,
2000 (“Stila Employee”).

 

The provisions of this Appendix P shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
a Stila Employee, as the context shall require.

 

For purposes of Section 1.6 hereof, the term “Stila
Employee” shall also include any other individual who became actively employed
by Stila Cosmetics, Inc. on or after January 1, 2001, became a
Participant in the Plan in accordance with the provisions of Section 3 of
this Plan, and continued to be a Participant as of April 10, 2006.

 

SECTION 1.2                                             COMMENCEMENT OF STATUS AS PARTICIPATING EMPLOYER

 

Stila Cosmetics, Inc., shall become a
Participating Employer under the Plan on January 1, 2001.

 

SECTION 1.3                                             COMMENCEMENT OF PLAN PARTICIPATION BY STILA EMPLOYEES

 

No Stila Employee shall be permitted to become a
Participant prior to January 1, 2001. 
Each Stila Employee who is regularly scheduled to work twenty hours or
more per week as of December 31, 2000, may become a Participant in the
Plan on January 1, 2001, notwithstanding any otherwise applicable
provisions of Section 3 of the Plan. 
Each other Stila Employee may become a Participant in the Plan on the
first applicable entry date on or after January 1, 2001, in accordance
with the provisions of Section 3 of the Plan; however, for purposes of
determining eligibility under the Plan, there shall be taken into account all
periods attributable to such person’s employment with the Stila, prior to December 31,
2000, that would otherwise have been taken into account for such purpose had
such prior employer otherwise been an Employer throughout such person’s entire
period of employment.  Any other
individual who becomes actively employed by Stila Cosmetics, Inc. on or
after January 1, 2001, may become a

 

P-1

 

Participant of the Plan on the first applicable
entry date on or after January 1, 2001, in accordance with the provisions
of Section 3 of the Plan.

 

SECTION 1.4                                             CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the
Retirement Account of a Stila Employee who becomes a Participant pursuant to
the provisions of Section 5 of the Plan, there shall be taken into account
all periods of such person’s employment with Stila that would otherwise have
been taken into account for such purpose had such prior employer otherwise been
an Employer throughout such person’s entire period of employment.

 

SECTION 1.5                                             VESTING

 

In determining the extent to which any Stila
Employee is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s
employment with Stila that would otherwise have been taken into account for
such purpose had such prior employer otherwise been an Employer throughout such
person’s entire period of employment.

 

SECTION 1.6                                             SALE OF STILA ASSETS AND OPERATIONS

 

On April 10, 2006, the Employer sold
certain assets and operations of Stila Cosmetics, Inc. to Stila Corp., an
unrelated purchaser.  In connection with
such sale, each Stila Employee who was actively employed by Stila Cosmetics, Inc.
as of April 10, 2006 shall be fully vested in his or her Accrued Benefit
under the Plan.

 

P-2

 

APPENDIX
Q

 

PROVISIONS
GOVERNING

CERTAIN
EMPLOYEES OF

AVEDA
CORPORATION AND

ITS
AFFILIATES AND PREDECESSORS

 

SECTION 1.1                                                                          SCOPE

 

The provisions of this Appendix Q to the
Estee Lauder Inc. Retirement Growth Account Plan shall apply with respect to
each person employed by Aveda Corporation, Aveda Services Inc., Aveda
Environmental Lifestyle Stores Inc. and Aveda Institute Inc. or their
respective predecessors (collectively, the “Aveda Companies”) on December 31,
2001 (“Aveda Employee”).

 

The provisions of this Appendix Q shall
apply notwithstanding any contrary provisions of the Plan, of which this
Appendix is a part.

 

Except to the extent expressly provided to
the contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
an Aveda Employee, as the context shall require.

 

SECTION 1.2                                                                          COMMENCEMENT OF STATUS AS PARTICIPATING EMPLOYER

 

Aveda Corporation, Aveda Services Inc.,
Aveda Environmental Lifestyle Stores Inc. and Aveda Institute Inc., shall
become Participating Employers under the Plan on January 1, 2002.

 

SECTION 1.3                                                                          COMMENCEMENT OF PLAN PARTICIPATION BY AVEDA EMPLOYEES

 

No Aveda Employee shall be permitted to
become a Participant prior to January 1, 2002.  Each Aveda Employee may become a Participant
in the Plan on the first applicable entry date on or after January 1,
2002, in accordance with the provisions of Section 3 of the Plan; however,
for purposes of determining eligibility under the Plan, there shall be taken
into account all periods attributable to such person’s employment with the
Aveda Companies, prior to December 31, 2001, that would otherwise have
been taken into account for such purpose had such prior employer otherwise been
an Employer throughout such person’s entire period of employment.  Any other individual who becomes actively
employed by the Aveda Companies on or after

 

Q-1

 

January 1, 2002, may become a Participant of
the Plan on the first applicable entry date on or after January 1, 2002,
in accordance with the provisions of Section 3 of the Plan.

 

SECTION 1.4                                                                          CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to
the Retirement Account of an Aveda Employee who becomes a Participant pursuant
to the provisions of Section 5 of the Plan, there shall be taken into
account all periods of such person’s employment with the Aveda Companies that
would otherwise have been taken into account for such purpose had such prior
employer otherwise been an Employer throughout such person’s entire period of
employment.

 

SECTION 1.5                                                                          VESTING

 

In determining the extent to which any Aveda
Employee is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s
employment with the Aveda Companies that would otherwise have been taken into
account for such purpose had such prior employer otherwise been an Employer
throughout such person’s entire period of employment.

 

Q-2

 

APPENDIX
R

 

PROVISIONS
GOVERNING

CERTAIN
EMPLOYEES OF

SASSABY
COSMETICS INC. AND

ITS
AFFILIATES AND PREDECESSORS

 

SECTION 1.1                                             SCOPE

 

The provisions of this Appendix R shall
apply with respect to each person employed by    Sassaby
Cosmetics Inc. or its predecessors (“Sassaby”) on June 30, 2002 (“Sassaby
Employee”).

 

The provisions of this Appendix R shall
apply notwithstanding any contrary provisions of the Plan, of which this
Appendix is a part.

 

Except to the extent expressly provided to
the contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
a Sassaby Employee, as the context shall require.

 

SECTION 1.2                                             COMMENCEMENT OF STATUS AS PARTICIPATING EMPLOYER

 

Sassaby Cosmetics Inc., shall become a
Participating Employer under the Plan on July 1, 2002.

 

SECTION 1.3                                             COMMENCEMENT OF PLAN PARTICIPATION BY SASSABY
EMPLOYEES

 

No Sassaby Employee shall be permitted to
become a Participant prior to July 1, 2002.  Each Sassaby Employee may become a
Participant in the Plan on the first applicable entry date on or after July 1,
2002, in accordance with the provisions of Section 3 of the Plan; however,
for purposes of determining eligibility under the Plan, there shall be taken
into account all periods attributable to such person’s employment with Sassaby,
prior to December 31, 2001, that would otherwise have been taken into
account for such purpose had such prior employer otherwise been an Employer
throughout such person’s entire period of employment.  Any other individual who becomes actively
employed by Sassaby on or after July 1, 2002, may become a Participant of
the Plan on the first applicable entry date on or after July 1, 2002, in
accordance with the provisions of Section 3 of the Plan.

 

SECTION 1.4                                             CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to
the Retirement Account of a Sassaby Employee who becomes a Participant pursuant
to the provisions of Section 5 of the Plan, there shall be taken into
account all periods of such person’s employment with Sassaby that would

 

R-1

 

otherwise have been taken into account for such
purpose had such prior employer otherwise been an Employer throughout such
person’s entire period of employment.

 

SECTION 1.5                                             VESTING

 

In determining the extent to which any
Sassaby Employee is vested in his Retirement Account pursuant to the provisions
of Section 8 of the Plan, there shall be taken into account all periods of
such person’s employment with Sassaby that would otherwise have been taken into
account for such purpose had such prior employer otherwise been an Employer
throughout such person’s entire period of employment.

 

R-2

 

APPENDIX
S

 

SPECIAL
PROVISIONS GOVERNING

TRANSFERRED
EMPLOYEES OF RODAN & FIELDS LLC

 

SECTION 1.1                         SCOPE

 

The provisions of this Appendix S shall
apply with respect to each person (i) who was an employee of Rodan &
Fields LLC on or after July 17, 2003, and (ii) whose employment is
subsequently transferred from such company to an Employer (each a “Transferred
Employee”).

 

The provisions of the Appendix S shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to
the contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
a Transferred Employee, as the context shall require.

 

For purposes of Section 1.5 hereof, the
term “Transferred Employee” shall also include any other individual who became
actively and primarily employed in connection with the Rodan & Fields
business on or after July 17, 2003, became a Participant in the Plan in
accordance with the provisions of Section 3 of this Plan, and continued to
be a Participant as of August 8, 2007.

 

SECTION 1.2                         COMMENCEMENT OF PLAN PARTICIPATION BY TRANSFERRED EMPLOYEES

 

The first date on which any Transferred
Employee may become a Participant shall be governed by the otherwise applicable
provisions of Section 3 of the Plan. 
In applying the terms of such participation eligibility provision, there
shall be taken into account all of such Transferred Employee’s period of
employment with Rodan & Fields LLC, the prior employer (including any
corporate predecessor thereof), but only to the extent that any such period of
employment would have been taken into account had such prior employer otherwise
been an Employer throughout such person’s entire period of employment.

 

SECTION 1.3                         CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to
the Retirement Account of a Transferred Employee who becomes a Participant
pursuant to the provisions of Section 5 of the Plan, there shall be taken
into account all periods of such person’s employment with his prior employer,
Rodan & Fields LLC (including any corporate predecessor thereof) which
would otherwise have been taken into account for such purpose had such prior
employer otherwise been an Employer throughout such person’s entire such period
of employment.

 

SECTION 1.4                         VESTING

 

In determining the extent to which any
Transferred Employee is vested in his Retirement Account pursuant to the
provisions of Section 8 of the Plan, there shall be taken into account all

 

S-1

 

periods of such person’s employment with his prior
employer, Rodan & Fields LLC (including any corporate predecessor
thereof) which would otherwise have been taken into account for such purpose
had such prior employer otherwise been an Employer throughout such person’s
entire period of employment.

 

SECTION 1.5                         SALE OF RODAN & FIELDS

 

The Retirement Accounts of Transferred
Employees who were actively performing services primarily for Rodan &
Fields as of August 8, 2007, and who remained employed by the purchaser of
the Rodan & Fields business through December 31, 2007, shall be
fully vested as of December 31, 2007.

 

S-2

 

APPENDIX
T

 

PROVISIONS
GOVERNING

CERTAIN
EMPLOYEES OF

DARPHIN
LLC AND

ITS
AFFILIATES AND PREDECESSORS

 

SECTION 1.1                                             SCOPE

 

The provisions of this Appendix T shall
apply with respect to each person employed by    Darphin
LLC or its predecessors (“Darphin”) on December 31, 2004 (“Darphin
Employee”).

 

The provisions of this Appendix T shall
apply notwithstanding any contrary provisions of the Plan, of which this
Appendix is a part.

 

Except to the extent expressly provided to
the contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
a Darphin Employee, as the context shall require.

 

SECTION 1.2                                             COMMENCEMENT OF STATUS AS PARTICIPATING EMPLOYER

 

Darphin LLC shall become a Participating
Employer under the Plan on January 1, 2005.

 

SECTION 1.3                                             COMMENCEMENT OF PLAN PARTICIPATION BY DARPHIN
EMPLOYEES

 

No Darphin Employee shall be permitted to
become a Participant prior to January 1, 2005.  Each Darphin Employee may become a
Participant in the Plan on the first applicable entry date on or after January 1,
2005, in accordance with the provisions of Section 3 of the Plan; however,
for purposes of determining eligibility under the Plan, there shall be taken
into account all periods attributable to such person’s employment with Darphin,
prior to January 1, 2005, that would otherwise have been taken into
account for such purpose had such prior employer otherwise been an Employer
throughout such person’s entire period of employment.  Any other individual who becomes actively
employed by Darphin on or after January 1, 2005, may become a Participant
of the Plan on the first applicable entry date on or after January 1,
2005, in accordance with the provisions of Section 3 of the Plan.

 

SECTION 1.4                                             CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to
the Retirement Account of a Darphin Employee who becomes a Participant pursuant
to the provisions of Section 5 of the Plan, there shall be taken into
account all periods of such person’s employment with Darphin or any affiliate
of Darphin (e.g., Laboratories Darphin SAS in France) that would otherwise have
been taken

 

T-1

 

into account for such purpose had such prior
employer otherwise been an Employer throughout such person’s entire period of
employment.

 

SECTION 1.5                                             VESTING

 

In determining the extent to which any
Darphin Employee is vested in his Retirement Account pursuant to the provisions
of Section 8 of the Plan, there shall be taken into account all periods of
such person’s employment with Darphin that would otherwise have been taken into
account for such purpose had such prior employer otherwise been an Employer
throughout such person’s entire period of employment.

 

T-2

 

THE
ESTEE LAUDER COMPANIES RETIREMENT GROWTH ACCOUNT PLAN

 

TABLE
OF CONTENTS

 

	
  SECTION 1 NAME AND
  CONSTRUCTION

  	
   

  	
  1

  
	
  SECTION 2 DEFINITIONS

  	
   

  	
  3

  
	
  SECTION 3 PARTICIPATION

  	
   

  	
  12

  
	
  SECTION 4 RETIREMENT DATES

  	
   

  	
  14

  
	
  SECTION 5 PARTICIPANTS’
  RETIREMENT ACCOUNTS

  	
   

  	
  15

  
	
  SECTION 6 CONTRIBUTIONS

  	
   

  	
  22

  
	
  SECTION 7 DEATH BENEFIT

  	
   

  	
  23

  
	
  SECTION 8 TERMINATION OF
  EMPLOYMENT

  	
   

  	
  25

  
	
  SECTION 9 OPTIONAL FORMS OF
  BENEFIT

  	
   

  	
  28

  
	
  SECTION 10 PAYMENT OF
  RETIREMENT INCOME

  	
   

  	
  33

  
	
  SECTION 11 ADMINISTRATION
  OF THE PLAN

  	
   

  	
  35

  
	
  SECTION 12 INVESTMENT OF
  PLAN ASSETS; DUTIES OF FIDUCIARY COMMITTEE

  	
   

  	
  38

  
	
  SECTION 13 OBLIGATIONS OF
  THE EMPLOYER

  	
   

  	
  40

  
	
  SECTION 14 MISCELLANEOUS
  PROVISIONS

  	
   

  	
  41

  
	
  SECTION 15 ADOPTION OF PLAN
  BY MEMBERS OF THE GROUP

  	
   

  	
  43

  
	
  SECTION 16 AMENDMENT AND
  TERMINATION

  	
   

  	
  45

  
	
  SECTION 17 LIMITATION
  ACCORDING TO TREASURY DEPARTMENT REQUIREMENTS

  	
   

  	
  47

  
	
  SECTION 18 TOP-HEAVY PLAN
  PROVISIONS

  	
   

  	
  48

  
	
  SECTION 19 FUNDING BASED
  LIMITS ON BENEFITS AND BENEFIT ACCRUALS

  	
   

  	
  51

  
	
  SECTION 20 EXECUTION

  	
   

  	
  54

  

 

 

TABLE
OF CONTENTS

 

	
  APPENDIX A

  	
   

  	
  A-1

  
	
   

  	
   

  	
   

  
	
  APPENDIX B

  	
   

  	
  B-1

  
	
   

  	
   

  	
   

  
	
  APPENDIX C

  	
  ADDITIONAL EARLY RETIREMENT BENEFITS

  	
  C-1

  
	
   

  	
   

  	
   

  
	
  APPENDIX D

  	
  ADDITIONAL EARLY RETIREMENT BENEFITS

  	
  D-1

  
	
   

  	
   

  	
   

  
	
  APPENDIX E

  	
  SPECIAL PROVISIONS

  	
  E-1

  
	
   

  	
  GOVERNING EMPLOYEES OF
  WHITMAN PACKAGING CORPORATION WHO DID NOT OTHERWISE BECOME ELIGIBLE EMPLOYEES
  PRIOR TO JANUARY 1, 1992

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX F

  	
  SPECIAL PROVISIONS

  	
  F-1

  
	
   

  	
  GOVERNING EMPLOYEES OF
  WHITMAN PACKAGING CORPORATION WHO OTHERWISE BECOME ELIGIBLE EMPLOYEES PRIOR
  TO JANUARY 1, 1992

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX G

  	
  SPECIAL PROVISIONS

  	
  G-1

  
	
   

  	
  GOVERNING EMPLOYEES OF
  NORTHTEC INC. WHO DID NOT OTHERWISE BECOME ELIGIBLE EMPLOYEES PRIOR TO
  JANUARY 1, 1992

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX H

  	
  SPECIAL PROVISIONS

  	
  H-1

  
	
   

  	
  GOVERNING EMPLOYEES OF
  NORTHTEC INC. WHO OTHERWISE BECOME ELIGIBLE EMPLOYEES PRIOR TO JANUARY 1,
  1992

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX I

  	
  ADDITIONAL EARLY RETIREMENT BENEFITS

  	
  I-1

  
	
   

  	
   

  	
   

  
	
  APPENDIX J

  	
  ADDITIONAL EARLY RETIREMENT BENEFITS - II

  	
  J-1

  
	
   

  	
   

  	
   

  
	
  APPENDIX K

  	
  SPECIAL PROVISIONS

  	
  K-1

  
	
   

  	
  GOVERNING EMPLOYEES OF
  BOBBI BROWN PROFESSIONAL COSMETICS WHO DID NOT OTHERWISE BECOME ELIGIBLE
  EMPLOYEES

  	
   

  

 

 

	
  APPENDIX L

  	
  SPECIAL PROVISIONS

  	
  L-1

  
	
   

  	
  GOVERNING ESTEE LAUDER
  EMPLOYEES WHO WERE PREVIOUSLY EMPLOYED BY THE DONNA KARAN COMPANY WHO DID NOT
  OTHERWISE BECOME ELIGIBLE EMPLOYEES

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX M

  	
  SPECIAL PROVISIONS

  	
  M-1

  
	
   

  	
  GOVERNING CERTAIN
  TRANSFERRED EMPLOYEES

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX N

  	
  PROVISIONS

  	
  N-1

  
	
   

  	
  GOVERNING CERTAIN
  EMPLOYEES OF MAKE-UP ART COSMETICS INC. AND ITS AFFILIATES AND PREDECESSORS

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX O

  	
  ADDITIONAL EARLY RETIREMENT BENEFITS - III

  	
  O-1

  
	
   

  	
   

  	
   

  
	
  APPENDIX P

  	
  PROVISIONS

  	
  P-1

  
	
   

  	
  GOVERNING CERTAIN
  EMPLOYEES OF STILA COSMETICS, INC. AND ITS AFFILIATES AND PREDECESSORS

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX Q

  	
  PROVISIONS

  	
  Q-1

  
	
   

  	
  GOVERNING CERTAIN
  EMPLOYEES OF AVEDA CORPORATION AND ITS AFFILIATES AND PREDECESSORS

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX R

  	
  PROVISIONS

  	
  R-1

  
	
   

  	
  GOVERNING CERTAIN
  EMPLOYEES OF SASSABY COSMETICS INC. AND ITS AFFILIATES AND PREDECESSORS

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX S

  	
  SPECIAL PROVISIONS

  	
  S-1

  
	
   

  	
  GOVERNING TRANSFERRED
  EMPLOYEES OF RODAN & FIELDS LLC

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX T

  	
  PROVISIONS

  	
  T-1

  
	
   

  	
  GOVERNING CERTAIN
  EMPLOYEES OF DARPHIN LLC AND ITS AFFILIATES AND PREDECESSORS

  	
   

  

 

 

AMENDMENT TO

 

THE ESTEE LAUDER COMPANIES

 

RETIREMENT GROWTH ACCOUNT PLAN

 

The Estee Lauder Companies Retirement Growth
Account Plan, as amended and restated generally effective as of January 1,
2002 (the “Plan”), is hereby further amended as follows:

 

1.  Effective
as of January 1, 1991, Section 2 of the Plan is amended by modifying
the definition of “Accrued Benefit” to read as follows:

 

“Accrued Benefit” means a monthly amount of
retirement income determined for a Participant as of a specified date, commencing
on a Participant’s Normal Retirement Date, and payable as a single life
annuity.  The Accrued Benefit as of a
specified date equals the Participant’s Retirement Account projected to Normal
Retirement Date with interest at 4% per annum and then divided by the
applicable factor from Appendix A.  If
the Accrued Benefit is determined after the Participant’s Normal Retirement
Date, the Accrued Benefit equals the Participant’s Retirement Account divided
by the applicable factor from Appendix A. 
For those who were participants in the Prior Plans as of December 31,
1990 and satisfy the applicable requirements set forth in Appendix B, the
Accrued Benefit is the greater of the accrued benefit described above or the
accrued benefit determined under the Prior Plans, as described in Section 5.5
hereof.

 

2.  Effective
as of January 1, 1991 and prior to March 28, 2005, Section 9.1(a) of
the Plan is amended to read as follows:

 

(a)  The normal form of benefit shall
be an income payable monthly for life, commencing on the Normal Retirement Date
and terminating with the payment preceding death; provided, however,
that a Participant may, with spousal consent under the terms of Section 9.4
hereof, if applicable, elect to receive the greater of the amount credited to
his Retirement Account or the Actuarial Equivalent of his Accrued Benefit in a
single cash lump sum; further provided, however, that if such
amount does not exceed $3,500 (with respect to Plan Years beginning prior to January 1,
1998) or $5,000 (with respect to Plan Years beginning on or after January 1,
1998), such amount shall automatically be paid to the Participant in a cash
lump sum in accordance with the last sentence of Section 10.1 hereof.

 

 

3.  Effective
as of March 28, 2005, Section 9.1(a) of the Plan is further
amended to read as follows:

 

(a)  The normal form of benefit shall
be an income payable monthly for life, commencing on the Normal Retirement Date
and terminating with the payment preceding death; provided, however,
that a Participant may, with spousal consent under the terms of Section 9.4
hereof, if applicable, elect to receive the greater of the amount credited to
his Retirement Account or the Actuarial Equivalent of his Accrued Benefit in a
single cash lump sum; further provided, however, that if such
amount does not exceed $1,000 (with respect to distributions commencing on or
after March 28, 2005) or $5,000 (with respect to distributions commencing
prior to March 28, 2005 and on or after January 1, 1998), such amount
shall automatically be paid to the Participant in a cash lump sum in accordance
with the last sentence of Section 10.1 hereof.

 

4.  Effective
as of January 1, 1996, Section 1 of Appendix A of the Plan is amended
by modifying the introductory language of such Section to read as follows:

 

Except as otherwise noted below, the assumptions to
be used to convert a single life annuity into any other form of benefit, other
than a lump sum distribution or a level income annuity (Option 5 of Section 9.3),
are as follows:

 

5.  Effective
as of January 1, 1996, Appendix A of the Plan is further amended by
modifying Section 2 of such Appendix to insert, immediately following the
words “an equivalent, immediately payable, annual amount of single life annuity”,
in each of three places in which they appear, the words “or an equivalent,
immediately payable, annual amount of level income annuity (Option 5 of Section 9.3)”.

 

6.  Effective
as of January 1, 1996, Appendix A of the Plan is further amended by
modifying Section 4 of such Appendix:

 

(a)  To insert, immediately following
the words “an equivalent, immediately payable lump sum distribution”, in each
of three places in which they appear, the words “or an equivalent, immediately
payable, annual amount of level income annuity (Option 5 of Section 9.3)”;
and

 

(b)  To replace the words “the
distribution of such lump sum benefit is to occur” in each of the three places
in which they appear, with the words “the distribution of such benefit is to
occur or commence”.

 

 

AMENDMENT TO

 

THE ESTEE LAUDER COMPANIES

 

RETIREMENT GROWTH ACCOUNT PLAN

 

The Estee Lauder Companies Retirement Growth
Account Plan, as amended and restated generally effective as of January 1,
2007 (the “Plan”), is hereby further amended as follows:

 

Effective as of November 1, 2008, Section 9.3
of the Plan is amended to read as follows:

 

“9.3         Notwithstanding the foregoing
provisions of this Section 9, a Participant who retires on or after his
Early Retirement Date may, subject to consent as provided in Sections 9.4 and
9.5 hereof, elect to receive the value of (i) his entire Accrued Benefit
in accordance with Option 1 or 2; or (ii) his Accrued Benefit as of his
Retirement Income Commencement Date less the value of his Accrued Benefit as of
December 31, 1990 separately in accordance with Option 1 or 2, and his
Accrued Benefit as of December 31, 1990 under a Prior Plan separately in
accordance with Option 3 or 4 or, for Retirement Income Commencement Dates
prior to November 1, 2008, Option 5.

 

Option 1.  An Actuarial Equivalent
retirement income to be paid to the retired Participant for the rest of his
life, and after his death either 50%, 100% or, effective for Plan Years
beginning on or after January 1, 2008, 75% (in accordance with his
election) of such Actuarial Equivalent retirement income to be paid to his
contingent annuitant for the rest of the contingent annuitant’s life.

 

Option 2.  An Actuarial Equivalent
retirement income to be paid to the retired Participant payable for the greater
of his lifetime or a period of ten (10) years.  If the retired Participant dies before the
expiration of ten (10) years, the remaining installments of his Actuarial
Equivalent retirement income shall be paid to his Beneficiary.

 

Option 3.  An Actuarial Equivalent
retirement income to be paid to the retired Participant for the rest of his
life, and after his death either 25%, 

 

 

66.67%, 75% or 100% (in accordance with his
election) of such Actuarial Equivalent retirement income to be paid to his
contingent annuitant for the rest of the contingent annuitant’s life.  Notwithstanding the foregoing, the 66.67%
contingent annuity shall not be available for Retirement Income Commencement
Dates on or after November 1, 2008.

 

Option 4.  An Actuarial Equivalent
retirement income to be paid to the retired Participant for the rest of his
life, and if he dies before receiving 120 monthly payments, such Actuarial
Equivalent retirement income to be paid to his Beneficiary for the remainder of
the 120 months.

 

Option 5.  A Participant who retires early
in accordance with Section 4.2 hereof and whose Retirement Income
Commencement Date is prior to November 1, 2008 may elect to receive an
Actuarial Equivalent retirement income providing larger monthly payments, in
lieu of the retirement income otherwise payable upon early retirement, until
the earliest date on which his Social Security benefit could commence;
thereafter his monthly retirement income payments shall be reduced by the
estimated monthly amount of his Social Security benefit computed to commence on
such date.  This optional form provides,
insofar as practical, a level total retirement income (from this Plan and
Social Security) for the Participant.  In
the event of the election of this Social Security adjustment option, the
monthly payment of the adjusted retirement income shall commence at the date of
retirement and shall cease with the earlier of the last payment prior to the
death of the Participant or the last payment payable as calculated under this
option.”

 

 

AMENDMENT TO

 

THE ESTEE LAUDER COMPANIES

 

RETIREMENT GROWTH ACCOUNT PLAN

 

The Estee Lauder Companies Retirement Growth
Account Plan, as amended and restated generally effective as of January 1,
2007 (the “Plan”), is hereby further amended as follows:

 

1.  Effective
as of August 1, 2008, Section 2.36 of the Plan (definition of “Surviving
Spouse”) is amended to read as follows:

 

2.36  “Surviving
Spouse” means a wife or husband of a Participant who is married to such
Participant by legal contract as of the earlier of the death of the Participant
or the Participant’s Retirement Income Commencement Date.

 

2.  Effective
for distributions commencing on or after August 1, 2008, Appendix A of the
Plan is amended as follows:

 

a.  Section 2
of Appendix A is amended by adding the following new sentence to the end of the
third paragraph thereof:

 

Effective for distributions commencing on or after August 1,
2008, the “applicable interest rate” shall be determined as of the fourth
calendar month immediately prior to the first day of such calendar quarter;
provided, however, that for the one-year period beginning on August 1,
2008, the “applicable interest rate” shall be determined as of either the
second or the fourth calendar month immediately prior to the first day of such
calendar quarter, whichever results in the larger distribution.

 

b.  Section 3
of Appendix A is amended by adding the following new sentence to the end of the
third paragraph thereof:

 

Effective for distributions commencing on or after August 1,
2008, the “applicable interest rate” shall be determined as of the fourth
calendar month immediately prior to the first day of such calendar quarter;
provided, however, that for the one-year period beginning on August 1,
2008, the “applicable interest rate” shall be determined as of either the
second or the fourth calendar month immediately prior to the first day of such
calendar quarter, whichever results in the larger distribution.

 

c.  Section 4
of Appendix A is amended by adding the following new sentence to the end of the
fourth paragraph thereof:

 

 

Effective for distributions commencing on or after August 1,
2008, the “applicable interest rate” for purposes of both clauses (i) and (ii) of
this paragraph shall be determined as of the fourth calendar month immediately
prior to the first day of such calendar quarter; provided, however, that for
the one-year period beginning on August 1, 2008, the “applicable interest
rate” shall be determined as of either the second or the fourth calendar month
immediately prior to the first day of such calendar quarter, whichever results
in the larger distribution.

 

d.  Section 5
of Appendix A is amended by adding the following new sentence to the end of the
fourth paragraph thereof:

 

Effective for distributions commencing on or after August 1,
2008, the “applicable interest rate” for purposes of both clauses (i) and (ii) of
this paragraph shall be determined as of the fourth calendar month immediately
prior to the first day of such calendar quarter; provided, however, that for
the one-year period beginning on August 1, 2008, the “applicable interest
rate” shall be determined as of either the second or the fourth calendar month
immediately prior to the first day of such calendar quarter, whichever results
in the larger distribution.

 

3.  Effective
as of August 1, 2008, Appendix I of the Plan (“Additional Retirement
Benefits”) is amended by revising Section 1.1 thereof to read as follows:

 

SECTION 1.1                         Eligibility for
Additional Benefits

 

The following Participants shall receive the
additional benefits provided pursuant to this Appendix I:

 

(OMITTED)

 

 

AMENDMENT TO

 

THE ESTEE LAUDER COMPANIES

 

RETIREMENT GROWTH ACCOUNT PLAN

 

The Estee Lauder Companies Retirement Growth
Account Plan, as amended and restated generally effective as of January 1,
2007 (the “Plan”), is hereby further amended as follows, effective January 1,
2008 except as provided below:

 

1. Section 2.4 (definition of “Accrued Benefit”)
is amended, effective as of January 1, 2007, by adding a new paragraph to
the end thereof to read as follows:

 

Notwithstanding the foregoing, for distributions
commencing prior to January 1, 2007, the Accrued Benefit as of a specified
date equals the Participant’s Retirement Account projected to Normal Retirement
Date with interest at 4% per annum and then divided by the applicable factor
from Appendix A; provided that if the Accrued Benefit is determined after the
Participant’s Normal Retirement Date, the Accrued Benefit equals the
Participant’s Retirement Account divided by the applicable factor from Appendix
A.

 

2. Section 2.4 (definition of “Average Final
Compensation”) is amended, effective as of January 1, 2009, by adding a
new sentence to the end thereof to read as follows:

 

Effective as of January 1,
2009, “compensation” for purposes of this Section 2.4 shall also include
any “differential pay” (as defined in Section 2.10).

 

3. Section 2.10 (definition of “Compensation”)
is amended, effective as of January 1, 2009, by adding a new paragraph to
the end thereof to read as follows:

 

Effective as
of January 1, 2009, Compensation shall also include any “differential pay.”
For this purpose, “differential pay” shall mean any payment which (i) is
made by an Employer to an individual with respect to any period during which he
or she is performing service in the uniformed services (as defined in Chapter
43, Title 38, United States Code) while on active duty for a period of more
than 30 days, and (ii) represents all or a portion of the amount the
individual would have received from the Employer if he or she were performing
services for such Employer.

 

4. Section 8.1 is amended by revising the
third sentence thereof to read as follows:

 

If a Participant terminates employment other than
by early or normal retirement or death after having completed at least five (5) Years
of Service (or at least three (3) Years of Service effective for Plan
Years beginning on or after January 1, 2008),

 

 

he shall be entitled to elect, with spousal consent
under the terms of Section 9.4 hereof, if applicable, payment of the
amount credited to his Retirement Account (or if greater, for distributions
made prior to January 1, 2007, an amount equal to the Actuarial Equivalent
of his Accrued Benefit) as of such date of termination in a cash lump sum or, (i) if
the Participant has a Surviving Spouse at the time of such termination of
employment, as an annuity of the form described in Section 9.2 hereof or (ii) if
the Participant has no Surviving Spouse at the time of such termination of
employment, as an annuity of the form of benefit described in Section 9.1
hereof.

 

5. Section 9.1(a) is amended in its
entirety to read as follows:

 

(a)           The
normal form of benefit shall be an income payable monthly for life, commencing
on the Normal Retirement Date and terminating with the payment preceding death;
provided, however, that a Participant may, with spousal consent
under the terms of Section 9.4 hereof, if applicable, elect to receive the
amount credited to his Retirement Account (or if greater, for distributions
made prior to January 1, 2007, an amount equal to the Actuarial Equivalent
of his Accrued Benefit) in a single cash lump sum; further  provided,
however, that if the Actuarial Equivalent value of such amount does not
exceed $1,000 (with respect to distributions commencing on or after March 28,
2005) or $5,000 (with respect to distributions commencing prior to March 28,
2005 and on or after January 1, 1998), such value shall automatically be
paid to the Participant in a cash lump sum in accordance with the last sentence
of Section 10.1 hereof.

 

6.  Section 9.4(f) is
amended, effective as of January 1, 2006, by adding a new sentence to the
end thereof to read as follows:

 

Notwithstanding the foregoing sentence, for annuity
starting dates occurring on or after January 1, 2006, the level of
benefits payable to a contingent annuitant who is not the Surviving Spouse
shall be determined in accordance with Q&A-2(c) of Treasury
Regulations Section 1.401(a)(9)-6, as applicable.

 

7.  Section 9.5
is amended by revising the second to last sentence thereof to read as follows:

 

Notwithstanding the foregoing, only the Participant
need consent to the commencement of a distribution in the form of a 50%, 75% or
100% joint and survivor annuity described in Option 1 or Option 3 under Section 9.3
while the Accrued Benefit is immediately distributable, provided that the
Surviving Spouse is the contingent annuitant.

 

8.  Section 9.6(c) is
amended in its entirety to read as follows:

 

(c)           “Eligible
Retirement Plan” means any of the following plans or arrangements that accepts
the individual’s Eligible Rollover Distribution: (i) an individual
retirement account described in Section 408(a) of the Code, (ii) an

 

 

individual retirement annuity described in Section 408(b) of
the Code, (iii) a Roth IRA described in Section 408A of the Code, (iv) a
qualified plan trust, (v) an annuity plan described in Section 403(a) of
the Code, (vi) an annuity contract described in Section 403(b) of
the Code, or (vii) an eligible deferred compensation plan described in Section 457(b) of
the Code that is maintained by a state, political subdivision of a state, or
any agency or instrumentality of a state or political subdivision of a state.  In the case of a non-Spouse Beneficiary, an “Eligible
Retirement Plan” shall include only (i) an individual retirement account
described in Section 408(a) of the Code, (ii) an individual
retirement annuity described in Section 408(b) of the Code (other
than an endowment contract) or (iii) a Roth IRA described in Section 408A
of the Code, established for the purpose of receiving the Eligible Rollover
Distribution on behalf of such non-Spouse Beneficiary.

 

9.  A new Section 14.11
is added to the Plan, effective January 1, 2007, to read as follows:

 

14.11       In the case of a Participant who, on or
after January 1, 2007, dies while performing “qualified military service”
(within the meaning of Section 414(u)(5) of the Code), the survivors
of the Participant shall be entitled to any additional benefits (including
vesting) provided under the Plan had the Participant resumed and then
terminated employment on account of death.

 

10.  A new Section 16.5
is added to the Plan to read as follows:

 

16.5         Upon
termination of the Plan, (i) the rate of interest used to determine
accrued benefits under the Plan shall be equal to the average of the rates of
interest used under the Plan during the 5-year period ending on the termination
date, and (ii) the interest rate and mortality table used to determine the
amount of any benefit under the Plan payable in the form of an annuity payable
at normal retirement age shall be the rate and table specified in Appendix A,
except that if such rate is a variable rate, the interest rate shall be
determined under the rules of clause (i). This section shall be
interpreted and applied in a manner consistent with Section 411(b)(5)(B)(vi) of
the Code and the guidance issued thereunder.

 

11. Section 19.1(a) is amended to read as
follows:

 

(a)           If any Participant is entitled to an “unpredictable
contingent event benefit” (as defined in Treasury Regulation Section 1.436-1(j)(9))
payable with respect to any event occurring during any Plan Year, such benefit
shall not be provided if the “adjusted funding target attainment percentage”
(as defined in Treasury Regulation Section 1.436-1(j)(1)) for such Plan
Year—

 

(i)            is less than 60 percent; or

 

(ii)           would be less than 60 percent taking into account such occurrence.

 

 

12. Section 19.3(b) is
amended by substituting “Estee Lauder” for “any Employer” in the first sentence
thereof.

 

13. Section 19.3(c) is
amended by substituting “Section 19.3 applies” for “either Section 19.3(c)(i) or
(ii) applies” at the end of the first sentence after sub-clause (ii) thereof.

 

14. Section 19.3(d) is
amended by adding a new sentence to the end thereof to read as follows:

 

Notwithstanding the
foregoing, the term “prohibited payment” does not include the payment of a
benefit that may be immediately distributed without the consent of the
Participant under Section 411(a)(11) of the Code.

 

15. A new Section 19.5
is added to the Plan to read as follows:

 

19.5         Applicable Code and Regulation Provisions.
The limitations of this Section 19 shall be interpreted and applied in a
manner consistent with Section 436 of the Code and Section 1.436-1 of
the Treasury Regulations.

 

16. 
Effective as of January 1, 2007, Section 1 of Appendix A of
the Plan is amended by modifying the introductory language of such Section to
read as follows:

 

Except as otherwise noted below, the assumptions to
be used to convert a single life annuity into any other form of benefit, other
than a lump sum distribution or a level income annuity (Option 5 of Section 9.3),
are as follows:

 

17. 
Effective as of January 1, 2007, Appendix A of the Plan is further
amended by modifying Section 2 of such Appendix to insert, immediately
following the words “an equivalent, immediately payable, annual amount of
single life annuity”, in each of three places in which they appear, the words “or
an equivalent, immediately payable, annual amount of level income annuity
(Option 5 of Section 9.3)”.

 

18. 
Effective as of January 1, 2007, Appendix A of the Plan is further
amended by modifying Section 4 of such Appendix:

 

(a)  To insert, immediately following
the words “an equivalent, immediately payable lump sum distribution”, in each
of three places in which they appear, the words “or an equivalent, immediately
payable, annual amount of level income annuity (Option 5 of Section 9.3)”;
and

 

(b)  To replace the words “the
distribution of such lump sum benefit is to occur” in each of the three places
in which they appear, with the words “the distribution of such benefit is to
occur or commence”.

 

 

AMENDMENT TO

 

THE ESTEE LAUDER COMPANIES

 

RETIREMENT GROWTH ACCOUNT PLAN

 

The Estee Lauder Companies Retirement Growth
Account Plan, as amended and restated generally effective as of January 1,
2007 (the “Plan”), is hereby further amended as follows effective as of April 1,
2010:

 

Section 2.10 (definition of “Compensation”) is
amended by adding a new paragraph to the end thereof to read as follows:

 

Notwithstanding the exclusion of commissions from “Compensation”
pursuant to the first paragraph of this Section 2.10, commissions paid on
or after April 1, 2010 to Employees of Aveda Corporation, Aveda Experience
Centers Inc., Aveda Institute Inc. or Aveda Services Inc. shall be counted as “Compensation”
for all purposes under the Plan.

 

 

AMENDMENT
TO

 

THE ESTEE LAUDER COMPANIES

 

RETIREMENT GROWTH ACCOUNT PLAN

 

The Estee Lauder Companies Retirement Growth
Account Plan, as amended and restated generally effective as of January 1,
2007 (the “Plan”), is hereby further amended, effective as of January 1,
2007, as provided below.

 

Section 5.7 of
the Plan is amended by redesignating subsection (f) as subsection (g), and
by adding a new subsection (f) to read as follows:

 

(f)            Except as provided below, the Compensation of each
Participant that may be taken into account in any limitation year for purposes
of this Section 5.7 must be actually paid or made available to the
Participant (or, if earlier, includable in the gross income of the Participant)
within the limitation year, and must be paid or treated as paid prior to the
Participant’s severance from employment with the Employer, including payments
made in the following limitation year solely because of the timing of pay
periods and pay dates (as described in Treasury Regulation Section 1.415(c)-2(e)(2)).
Notwithstanding the preceding sentence, the following amounts are also included
in Compensation for a limitation year: any payment of regular compensation for
services during the Employee’s regular working hours, compensation for services
outside the Employee’s regular working hours (such as overtime or shift differential),
commissions, bonuses or other similar payments made after severance from
employment with the Employer that are paid by the later of 21⁄2 months after
severance from employment or the end of the limitation year that includes the
date of severance from employment.

 

 

APPENDIX U

 

PROVISIONS GOVERNING

CERTAIN EMPLOYEES OF

APPLIED GENETICS INC. DERMATICS

AND ITS AFFILIATES AND
PREDECESSORS

 

SECTION 1.1          SCOPE

 

The provisions of this Appendix U shall apply with
respect to each person employed by Applied Genetics Inc. Dermatics or its
predecessors (“AGI”) on September 17, 2008 and whose employment is
subsequently transferred from AGI to an Employer  on
or before April 1, 2009 (each an “AGI Employee”).

 

The provisions of this Appendix U shall apply
notwithstanding any contrary provisions of the Plan, of which this Appendix is
a part.

 

Except to the extent expressly provided to the
contrary herein, all defined terms shall have the same meanings as provided
under the Plan.  Each reference to the
Plan shall be to the Plan as in effect at the time such provision is applied to
an AGI Employee, as the context shall require.

 

SECTION 1.2          COMMENCEMENT OF PLAN PARTICIPATION BY AGI
EMPLOYEES

 

No AGI Employee shall be permitted to become a
Participant prior to the first date after September 17, 2008 that such AGI
Employee became an Employee of an Employer. 
The first date on which any AGI Employee may become a Participant shall
be governed by the otherwise applicable provisions of Section 3 of the
Plan.  In applying the terms of such
participation eligibility provision, there shall be taken into account all of
such AGI Employee’s period of employment with AGI, the prior employer
(including any corporate predecessor thereof), but only to the extent that any
such period of employment would have been taken into account had such prior
employer otherwise been an Employer throughout such person’s entire period of
employment.

 

SECTION 1.3          CREDITS TO RETIREMENT ACCOUNTS

 

In determining the amount to be credited to the
Retirement Account of an AGI Employee who becomes a Participant pursuant to the
provisions of Section 5 of the Plan, there shall not be taken into account
any periods of such person’s employment with AGI or any corporate predecessor
thereof.

 

 

SECTION 1.4          VESTING

 

In determining the extent to which any AGI Employee
is vested in his Retirement Account pursuant to the provisions of Section 8
of the Plan, there shall be taken into account all periods of such person’s
employment with AGI which would otherwise have been taken into account for such
purpose had such prior employer otherwise been an Employer throughout such
person’s entire period of employment.

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