Document:

Exhibit 10.42

COTY INC.

STOCK PURCHASE PROGRAM FOR DIRECTORS

(amended and
restated as of April 8, 2013)

SECTION 1

PURPOSE AND DURATION

	
  

 	
  

 
	
 1.1

 	
 The purpose of this
 Coty Inc. Stock Purchase Program for Directors is to promote the interests of
 the Company and its shareholders by enabling Directors to acquire an
 increased stake in the Company through purchases of Shares. The original
 effective date of the Program was September 23, 2011, and the Program shall
 remain in effect until the date the Program is terminated by action of the
 Board. The effective date of this amended and restated program document is
 the Effective Date. 

 
	
  

 	
  

 
	
 SECTION
 2

 
	
 DEFINITIONS

 
	
  

 	
  

 
	
  

 	
 Whenever used in the
 Program, the following terms have the meanings set forth below. Terms not
 otherwise defined herein have the meanings given those terms in the Coty Inc.
 Executive Ownership Plan, as amended from time to time.

 
	
  

 	
  

 
	
 2.1

 	
  “Company” means Coty Inc., a Delaware
 corporation, and any successor thereto as provided in Section 8.1. 

 
	
  

 	
  

 
	
 2.2

 	
  “Director” means a member of the Board.

 
	
  

 	
  

 
	
 2.3

 	
  “Effective Date” means the means the day
 immediately prior to the date of the underwritten initial public offering of
 the Company’s common stock pursuant to a registration statement that is
 declared effective by the Securities and Exchange Commission.

 
	
  

 	
  

 
	
 2.4

 	
  “Participant” means a Director or a
 former Director holding Purchased Shares.

 
	
  

 	
  

 
	
 2.5

 	
  “Program” means this Coty Inc. Stock
 Purchase Program for Directors, as amended from time to time.

 
	
  

 	
  

 
	
 2.6

 	
 “Purchased Shares” means
 Shares purchased by a Participant under the Program.

 
	
  

 	
  

 
	
 2.7

 	
  “Share” means a share of Class A Common
 Stock, par value $0.01, of the Company. 

 
	
  

 	
  

 
	
 SECTION
 3

 
	
 Administration

 
	
  

 	
  

 
	
 3.1

 	
 The Program shall be
 administered by the Committee, which shall have full power and discretion to
 construe and interpret the Program. All determinations and decisions made by
 the Committee shall be final, conclusive and binding on all Persons.

 

SECTION
4

Shares Subject to the Program

	
  

 	
  

 
	
 4.1

 	
 An aggregate of
 10,000,000 Shares shall be available for purchase under the Program, subject
 to the Company’s Articles of Incorporation and Bylaws, as in effect from time
 to time. Such Shares may consist, in whole or in part, of
 authorized and unissued Shares or of treasury Shares.

 
	
  

 	
  

 
	
 4.2

 	
 As of the Effective
 Date, no new Shares may be purchased under the Program.

 
	
  

 	
  

 
	
 SECTION
 5

 
	
 Share Purchase Opportunity

 
	
  

 	
  

 
	
 5.1

 	
 Any Participant who is
 a Director on an Exercise Date may elect on or before such Exercise Date to
 purchase on such Exercise Date such number of Shares as the Director may
 specify on such election form as the Committee shall provide, subject to the
 overall limitation set forth in Section 4.1. 

 
	
  

 	
  

 
	
 5.2

 	
 The purchase price for
 such Shares shall be their Fair Market Value as of such Exercise Date. The
 Participant shall pay the full amount of such purchase price in cash or by
 check no later than the Exercise Date, whereupon certificates for Shares shall
 be issued in the Participant’s name. 

 
	
  

 	
  

 
	
 5.3

 	
 By making a purchase of
 Shares under this Program, a Participant agrees to be bound by the terms of
 the Program.

 
	
  

 	
  

 
	
 SECTION
 6

 
	
 Purchase and Sale Rights

 
	
  

 	
  

 
	
 6.1

 	
 Restrictions. The Committee may impose
 such restrictions on any Purchased Shares as it deems necessary or advisable,
 including, without limitation, restrictions under applicable federal
 securities laws, under the requirements of any stock exchange or market upon
 which the Shares are then listed and/or traded, and under any blue sky or
 state securities laws. 

 
	
  

 	
  

 
	
 6.2

 	
 Additional Conditions of Transfer. The
 Company shall not be required (i) to transfer on its books any Shares that
 have been sold or transferred, or (ii) to treat as owner of such Shares, to
 accord the right to vote as such owner, or to pay dividends to any transferee
 to whom such Shares have been transferred in violation of the Program. 

 

-2-

	
  

 	
  

 
	
 SECTION
 7

 
	
 Amendment, Modification and Termination

 
	
  

 	
  

 
	
 7.1

 	
 Amendment, Modification and Termination.
 The Board may at any time and from time to time alter, amend, modify or
 terminate the Program in whole or in part, without the approval of the
 Company’s shareholders, except to the extent such approval is required by
 law. 

 
	
  

 	
  

 
	
 SECTION
 8

 
	
 Miscellaneous Provisions

 
	
  

 	
  

 
	
 8.1

 	
 Successors. All obligations of the
 Company under the Program shall be binding on any successor to the Company,
 whether the existence of the successor results from a direct or indirect
 purchase of all or substantially all of the Company’s stock, or a merger or
 consolidation, or otherwise.

 
	
  

 	
  

 
	
 8.2

 	
 Requirements of Law. The issuance of
 Shares under the Program shall be subject to all applicable laws, rules and
 regulations, and to any approvals by governmental agencies or national
 securities exchanges as may be required.

 
	
  

 	
  

 
	
 8.3

 	

  Governing
 Law. To the extent not preempted by Federal law, the
 Program shall be construed and enforced in accordance with, and governed by,
 the laws of the State of New York, without giving effect to its conflicts of
 law principles that would require the application of the law of any other
 jurisdiction.
 

-3-Exhibit 10.43

COTY INC.

EQUITY AND LONG-TERM INCENTIVE PLAN

(as amended and restated on April 8, 2013)

SECTION 1
PURPOSE AND
DURATION

	
  

 	
  

 	
  

 
	
 1.1

 	
 Purpose. The purpose of this Coty Inc. Equity and
 Long-Term Incentive Plan is to promote the interests of Coty Inc. and its
 shareholders by (i) attracting and retaining exceptional executive personnel
 and other key employees of the Company and its Affiliates; (ii) motivating
 such employees by means of performance-related incentives to achieve
 long-range performance goals; and (iii) enabling such employees to
 participate in the long-term growth and financial success of the Company. 

 
	
  

 	
  

 	
  

 
	
 1.2

 	
 Effective Date and Term of the Plan.
 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 The original effective date of the Plan is November 8, 2012. The
 effective date of this amended and restated plan document is the Effective
 Date.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 The Plan will terminate upon the earlier of (i) the date on which all
 Shares available for issuance under the Plan have been issued pursuant to the
 exercise of Stock Options or the Award of Shares under the Plan, or (ii) the
 date specified by action of the Board. Upon such Plan termination, all Awards
 outstanding under the Plan will continue to have full force and effect in
 accordance with the terms of the Terms and Conditions evidencing each Award.

 

SECTION
2
DEFINITIONS

            Whenever
used in the Plan, the following terms have the meanings set forth below:

	
  

 	
  

 
	
 2.1

 	
  “Affiliate” means
 any entity (i) that, directly or indirectly, is controlled by the Company, or
 in which the Company has a significant equity interest, and (ii) as to which
 the Company is an “eligible issuer of service recipient stock” within the
 meaning of Treas. Reg. 1.409A-1(b)(5)(iii)(E), in any such case as determined
 by the Committee. 

 
	
  

 	
  

 
	
 2.2

 	
  “Applicable Fraction”
 means a fraction, the numerator of which is the number of days elapsed from
 the Grant Date of an Award to the date of the Participant’s termination of
 Service and the denominator of which is the number of days between the Grant
 Date and the date the Award was scheduled to become exercisable or otherwise
 vest. 

 

-1-

	
  

 	
  

 	
  

 
	
 2.3

 	
  “Award” means a
 grant under the Plan to a Participant of a Stock Option, Stock Appreciation
 Right, Restricted Stock Award, Restricted Stock Unit, Performance Award, or
 Other Stock-Based Award. 

 
	
  

 	
  

 	
  

 
	
 2.4

 	
  “Board” means the
 Board of Directors of the Company.

 
	
  

 	
  

 	
  

 
	
 2.5

 	
  “Business Day”
 means any day other than a Saturday, Sunday, or legal holiday, or a day on
 which the national securities exchange that constitutes the principal market
 for the Shares is closed.

 
	
  

 	
  

 	
  

 
	
 2.6

 	
  “Cause” has the
 meaning set forth in any employment, severance or other agreement between the
 Company or an Affiliate and the Participant. If there is no employment,
 severance or other agreement between the Company or an Affiliate and the
 Participant, or if such agreement does not define “Cause,” then “Cause” shall
 mean the occurrence of any of the following, as determined by the Committee
 in its sole discretion:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 a Participant’s willful and continued failure substantially to
 perform his or her duties (other than as a result of total or partial
 incapacity due to physical or mental illness or as a result of termination by
 such Participant for Good Reason), which failure continues for more than 30
 days after receipt by the Participant of written notice setting forth the
 facts and circumstances identified by the Company as constituting adequate
 grounds for termination under this clause (a);

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 any willful act or omission by a Participant constituting dishonesty,
 fraud or other malfeasance, and any act or omission by a Participant
 constituting immoral conduct, which in any such case is injurious to the
 financial condition or business reputation of the Company or any of its
 Affiliates;

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 a Participant’s indictment for a felony under the laws of the United
 States or any state thereof or any other jurisdiction in which the Company
 conducts business; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 a Participant’s breach of any nonsolicitation, noncompetition,
 confidentiality, or other restrictive covenant by which he or she is bound.

 
	
  

 	
  

 	
  

 
	
  

 	
 For purposes of this definition, no act or failure to act shall be
 deemed “willful” unless effected by a Participant not in good faith and
 without a reasonable belief that such action or failure to act was in or not
 opposed to the Company’s best interests.

 
	
  

 	
  

 	
  

 
	
 2.7

 	
  “Change in Control” means
 the occurrence of any of the following:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Any Person or “group” (as such term is used in Sections 13(d) and
 14(d) of the Exchange Act) that is not the Majority Shareholder is or becomes
 the “beneficial owner” (as defined below), directly or indirectly, of
 securities representing either (i) more than 50% of the combined voting power
 of the Company’s then

 

-2-

	
  

 	
  

 	
  

 
	
  

 	
  

 	
 outstanding securities, or (ii) 20% or more of the combined voting
 power of the Company’s then outstanding securities at a time when the
 Majority Shareholder hold less than 30% of such combined voting power. For
 purposes of this clause (a), “beneficial owner” has the meaning given that
 term in Rule 13d-3 under the Exchange Act, except that a Person shall be
 deemed to be the “beneficial owner” of all shares that any such Person has
 the right to acquire pursuant to any agreement or arrangement or upon
 exercise of conversion rights, warrants, options or otherwise, without regard
 to the 60-day period referred to in such Rule;

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Individuals who constitute the Board on the Effective Date (the “Incumbent
 Board”) cease for any reason to constitute at least a majority thereof, provided, that any Person becoming a
 director subsequent to such date whose election, or nomination for election
 by the Company’s shareholders, was approved by a vote of at least
 three-quarters of the directors then comprising the Incumbent Board shall be,
 for purposes of this clause (b), considered as though such Person were a
 member of the Incumbent Board; and provided,
 further, that this clause (b)
 shall not apply as long as the Majority Shareholder is the beneficial owner
 of a majority of voting power the Company’s
 outstanding securities;

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 The Majority Shareholder enters into any joint venture, joint
 operating arrangement, partnership, standstill agreement or other arrangement
 similar to any of the foregoing with any other Person or group, pursuant to
 which such Person or group assumes significant operational or managerial
 control of the Company; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 The shareholders of the Company approve a plan or agreement providing
 (i) for a merger or consolidation of the Company other than with a wholly
 owned subsidiary and other than a merger or consolidation that would result
 in the voting securities of the Company outstanding immediately prior thereto
 continuing to represent (either by remaining outstanding or by being
 converted into voting securities of the surviving entity) more than 51% of
 the combined voting power of the voting securities of the Company or such
 surviving entity outstanding immediately after such merger or consolidation,
 or (ii) for a sale, exchange or other disposition of all or substantially all
 of the business or assets of the Company. If any of the events enumerated in
 this clause (d) occurs, the Board shall determine the effective date of the
 Change in Control resulting therefrom for purposes of this Plan.

 
	
  

 	
  

 	
  

 
	
 2.8

 	
  “Code” means the
 U.S. Internal Revenue Code of 1986, as amended from time to time.

 
	
  

 	
  

 	
  

 
	
 2.9

 	
  “Committee”
 means the Remuneration and Nominating Committee of the Board or any successor committee with
 responsibility for compensation, or any subcommittee, as long as the number
 of Committee members and their qualifications shall at all times be
 sufficient to meet the independence requirements of the New York Stock
 Exchange, Inc. 

 

-3-

	
  

 	
  

 
	
  

 	
 or any other applicable exchange on which the Company’s common
 equity is at the time listed and, as applicable, the requirements for “outside
 directors” under Section 162(m) and the regulations thereunder, as in effect
 from time to time.

 
	
  

 	
  

 
	
 2.10

 	
  “Company” means
 Coty Inc., a Delaware corporation, and any successor thereto as provided in
 Section 16.1. 

 
	
  

 	
  

 
	
 2.11

 	
  “Designated Beneficiary”
 means the Person or Persons the Participant designates from time to time on a
 signed form prescribed by the Committee, properly filed with the Committee
 during the Participant’s lifetime, as the beneficiary of any amounts or
 benefits the Participant owns or is to receive under the Plan, in accordance
 with Section 12.1. A properly filed beneficiary designation will revoke all
 prior designations by the same Participant. If no such form has been filed
 with the Committee, the Designated Beneficiary shall be the beneficiary named
 by the Participant in the Company’s qualified 401(k) savings plan or, if
 none, the Beneficiary’s estate. 

 
	
  

 	
  

 
	
 2.12

 	
  “Director” means a
 member of the board of directors of the Company or an Affiliate.

 
	
  

 	
  

 
	
 2.13

 	
  “Disability” means
 either (i) disability as defined for purposes of the Company’s disability
 benefit plan, or (ii) a Participant’s inability, as a result of physical or
 mental incapacity, to perform the duties of his or her position(s) for a
 period of six consecutive months or for an aggregate of six months in any
 consecutive 12-month period. Any question as to the existence of the
 Disability of a Participant as to which the Participant and the Company
 cannot agree shall be determined in writing by a qualified independent
 physician mutually acceptable to the Participant and the Company. If the
 Participant and the Company cannot agree as to a qualified independent
 physician, each shall appoint such a physician and those two physicians shall
 select a third who shall make such determination in writing. The
 determination of Disability made in writing to the Company and the
 Participant shall be final and conclusive for all purposes of the Plan.
 Following a Change in Control, the Company shall pay all expenses incurred in
 the determination of whether a Participant is disabled.

 
	
  

 	
  

 
	
 2.14

 	
  “Effective Date” means the date on which the Amended and
 Restated Certificate of Incorporation of the Company that is contemplated to
 be adopted by the Company in connection with the first underwritten public offering
 of the Company’s common stock is filed with the Secretary of State of the
 State of Delaware.

 
	
  

 	
  

 
	
 2.15

 	
  “Employee” means
 an employee of the Company or an Affiliate (that is not a Joint Venture).

 
	
  

 	
  

 
	
 2.16

 	
  “Exchange Act”
 means the U.S. Securities Exchange Act of 1934, as amended from time to time,
 or any successor act thereto.

 

-4-

	
  

 	
  

 	
  

 	
  

 
	
 2.17

 	
  “Executive Officer”
 means any Company employee who is an “executive officer” as defined in Rule
 3b-7 promulgated under the Exchange Act.

 
	
  

 	
  

 	
  

 	
  

 
	
 2.18

 	
 “Exercise Date” shall
 mean any Business Day.

 
	
  

 	
  

 	
  

 	
  

 
	
 2.19

 	
  “Exercise Price”
 means the price at which a Participant may purchase a Share pursuant to a
 Stock Option or Stock Appreciation Right.

 
	
  

 	
  

 	
  

 	
  

 
	
 2.20

 	
  “Fair Market Value”
 as it relates to a Share means, unless otherwise determined by the Committee,
 the most recent closing price of a Share on the principal national securities
 exchange on which the Shares are then listed, or if there were no sales on
 such date, on the next preceding day on which there were sales, or if such Shares
 are not listed on a national securities exchange, the last reported bid price
 in the over-the-counter market. 

 
	
  

 	
  

 	
  

 	
  

 
	
 2.21

 	
  “Good Reason” shall
 have the meaning set forth in any employment, severance or other agreement
 between the Company or an Affiliate and the Participant. If there is no
 employment, severance or other agreement between the Company or an Affiliate
 and the Participant, or if such agreement does not define “Good Reason,” then
 “Good Reason” shall mean the occurrence of any of the following:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Before a Change in Control:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 A Participant’s removal from, or the Company’s failure to reelect or
 reappoint the Participant to, his or her positions at the Company (other than
 as a result of a promotion). For purposes of this clause (i), a mere change
 of title shall not constitute removal from, or non-reelection to, such
 position, provided that a Participant’s new title is substantially equivalent
 to the Participant’s title as of the Grant Date and his or her position is
 otherwise not adversely affected; or

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 The relocation of a Participant’s principal workplace without his or
 her consent to a location more than 25 miles distant from its current
 location.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Following a Change in Control:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 Any of the events described in clause (a) above;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 A material diminution in a Participant’s title, position, duties or
 responsibilities, or the assignment to a Participant of duties that are
 inconsistent, in a material respect, with the scope of duties and responsibilities
 associated with his or her position as of the Grant Date; or

 

-5-

	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 The failure of the Company to continue a Participant’s participation
 in the Company’s Annual Performance Plan and in this Plan on a basis that is
 commensurate with his or her position.

 

	
  

 	
  

 
	
 2.22

 	
  “Grant Date” means
 the date on which an Award is granted.

 
	
  

 	
  

 
	
 2.23

 	
  “Joint Venture”
 has the meaning given that term in Section 6.9.

 
	
  

 	
  

 
	
 2.24

 	
  “Majority
 Shareholder” means (i) the Company’s majority
 shareholder as of the Effective Date or (ii) a Benckiser Permitted Holder as
 defined in the Company’s Certificate of Incorporation effective on the
 Effective Date or any other similarly situated Person as determined by the
 Committee.

 
	
  

 	
  

 
	
 2.25

 	
  “Original Effective
 Date” means November 8, 2012.

 
	
  

 	
  

 
	
 2.26

 	
  “Other Stock-Based Awards” has
 the meaning given that term in Section 10. 

 
	
  

 	
  

 
	
 2.27

 	
  “Owned Shares”
 means Shares that a Participant has acquired through the exercise of a Stock
 Option or a Stock Appreciation Right, the vesting of Restricted Stock, the
 settlement of a Restricted Stock Unit or a distribution of Shares in
 connection with an Other Stock-Based Award.

 
	
  

 	
  

 
	
 2.28

 	
  “Participant”
 means an Employee selected by the Committee to receive an Award under the
 Plan pursuant to Section 5.2, or who has an outstanding Award granted under
 the Plan.

 
	
  

 	
  

 
	
 2.29

 	
  “Performance Award”
 means a right to receive cash or Shares (as determined by the Committee) upon
 the achievement, in whole or in part, of the applicable Performance Criteria
 pursuant to Section 9. A grant of Restricted Stock, Restricted Stock Units,
 or Other Stock Awards may be designed to qualify as Performance Awards.

 
	
  

 	
  

 
	
 2.30

 	
  “Performance-Based
 Exception” means the performance-based exception
 from the tax deductibility limitations of Code Section 162(m) and any
 regulations promulgated thereunder.

 
	
  

 	
  

 
	
 2.31

 	
  “Performance
 Criteria” means the objectives established by the
 Committee for a Performance Period for the purpose of determining the extent
 to which an Award of Performance Awards has been earned. “Performance
 Criteria” may be based on the relative
 or comparative attainment of one or more of the following criteria during a
 Performance Period, whether in absolute terms or relative to the performance
 of one or more similarly situated companies or a published index covering the
 performance of a number of companies: total stockholder return (inclusive or
 exclusive of dividends paid); stock price; gross, operating or net earnings
 or margins; approved rate increases; earnings

 

-6-

	
  

 	
  

 
	
  

 	
 before interest and taxes;
 earnings before interest, taxes, depreciation and amortization (“EBITDA”); EBITDA
 excluding traditional working media; earnings
 per share; economic value added; ratio of operating earnings to capital
 spending; net sales; sales growth; return on assets, capital or equity;
 income; market share; level of expenses; revenue; revenue growth; cash flow;
 increases in customer base; capital expenditures; cost reductions and expense
 control objectives; compliance with environmental or regulatory goals or
 requirements; conservation; budget objectives; working capital; mergers,
 acquisitions and divestitures; attainment of objectives measured in terms of
 quality or safety; customer complaints or customer satisfaction; and
 improvements in financial controls; and, in the case of persons who are not
 Executive Officers, such other criteria as may be determined by the
 Committee. Performance Criteria may be established on a Company-wide basis or
 with respect to one or more business units, divisions, subsidiaries, or
 geographic locations, or on an individual basis. 

 
	
  

 	
  

 
	
  

 	
 At the time the Committee
 establishes Performance Criteria for a Performance Period, the Committee may
 exclude any or all “extraordinary items” as determined under U.S. generally
 accepted accounting principles including, without limitation, the charges or
 costs associated with restructurings of the Company or any subsidiary,
 discontinued operations, other unusual or non-recurring items, the cumulative
 effects of accounting changes or such other objective factors as the
 Committee deems appropriate. Unless otherwise explicitly stated by the
 Committee at the time Performance Criteria are established, each
 applicable performance goal shall be appropriately adjusted for one or more
 of the following items: (i) asset impairments or write downs; (ii) litigation
 judgments or claim settlements; (iii) the effect of changes in tax law,
 accounting principles or such laws or provisions affecting reported results;
 (iv) accruals for reorganization and restructuring programs; (v) any
 extraordinary nonrecurring items as described in Accounting Standards
 Codification (ASC) 225-20 and/or in management’s discussion and analysis of
 financial condition and results of operations appearing in the Company’s
 annual report to shareholders for the applicable year; (vi) the operations of
 any business acquired by the Company or any affiliate or of any joint venture
 in which the Company or affiliate participates; (vii) the divestiture of one
 or more business operations or the assets thereof; or (viii) the costs
 incurred in connection with such acquisitions or divestitures; and (ix)
 charges for stock based compensation.

 
	
  

 	
  

 
	
  

 	
 Except in the case of Awards to
 Executive Officers intended to qualify for the Performance-Based Exception,
 the Committee may at any time adjust the Performance Criteria for any
 Performance Period as it deems equitable. The Committee shall
 have no obligation to treat Participants uniformly.

 
	
  

 	
  

 
	
 2.32

 	
  “Performance
 Period” means the 12-month time period during which
 Performance Criteria must be met in order for a Participant to earn
 Performance Awards granted under Section 9.

 

-7-

	
  

 	
  

 	
  

 
	
 2.33

 	
  “Person” means any
 individual, partnership, corporation, limited liability company, association,
 joint stock company, trust, joint venture, unincorporated organization and
 any other entity, whether foreign or domestic, including any governmental
 entity or any department, agency or political subdivision thereof.

 
	
  

 	
  

 	
  

 
	
 2.34

 	
  “Plan” means this
 Coty Inc. Equity and Long-Term Incentive Plan, as amended from time to time.

 
	
  

 	
  

 	
  

 
	
 2.35

 	
  “Prior Plans” means
 the Coty Inc. Long-Term Incentive Plan and the Coty Inc. Executive Ownership
 Plan, each as in effect immediately prior to the Original Effective Date and
 as may be amended from time to time. 

 
	
  

 	
  

 	
  

 
	
 2.36

 	
  “Restricted Stock”
 means a contingent grant of Shares awarded to a Participant pursuant to
 Section 8.

 
	
  

 	
  

 	
  

 
	
 2.37

 	
  “Restricted Stock Unit”
 means a Restricted Stock Unit granted to a Participant, as described in
 Section 8.

 
	
  

 	
  

 	
  

 
	
 2.38

 	
  “Restriction Period” means the period during which the
 transfer of Restricted Stock is limited in some way (based on the passage of
 time, the achievement of performance objectives, or the occurrence of other
 events as the Committee determines, in its sole discretion) and, except as
 provided in the Terms and Conditions, during which the Restricted Stock and
 any Restricted Stock Unit is not vested.

 
	
  

 	
  

 	
  

 
	
 2.39

 	
  “Retirement” means
 a termination of Service (other than a termination of Service for Cause):

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 after attaining age 60, but only if the Company or the employing
 Affiliate consents to the treatment of such termination as a “Retirement” for
 purposes of this Plan; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 qualifying as a retirement at normal retirement age under the laws
 and/or arrangements applicable to the Participant, as reasonably determined
 by the Committee. 

 
	
  

 	
  

 	
  

 
	
 2.40

 	
  “Section 162(m)”
 means Section 162(m) of the Code and the applicable regulations and other
 legal authority promulgated thereunder.

 
	
  

 	
  

 	
  

 
	
 2.41

 	
  “Section 409A” means
 Section 409A of the Code and the applicable regulations and other legal
 authority promulgated thereunder. 

 
	
  

 	
  

 	
  

 
	
 2.42

 	
  “Service” means
 the provision of services in the capacity of an Employee or Continuing
 Director of the Company or an Affiliate. A transfer of Service from the
 Company to an

 

-8-

	
  

 	
  

 
	
  

 	
 Affiliate or from an Affiliate to the Company or another Affiliate
 shall not constitute a termination of Service under the Plan or any Terms and
 Conditions. All determinations regarding Service, including whether any leave
 of absence is a termination of Service, shall be made by the Committee in its
 sole discretion. For purposes of this paragraph, a “Continuing Director”
 shall mean any individual who, upon his or her termination of employment with
 the Company or an Affiliate, continues to serve as a member of the Board or
 the board of directors of an Affiliate. The Service of a Continuing Director
 shall terminate when he or she ceases to serve as a member of the Board or on
 the board of directors of an Affiliate. 

 
	
  

 	
  

 
	
 2.43

 	
  “Share” means a
 share of the Class A Common Stock, par value $.01 per share, of the Company,
 or such other securities of the Company as may be designated by the Committee
 from time to time. 

 
	
  

 	
  

 
	
 2.44

 	
  “Stock Appreciation Right”
 or “SAR” means an Award
 consisting of a right to receive any excess in value of shares of common
 stock over the exercise price and designated as an SAR pursuant to the terms
 of Section 7.

 
	
  

 	
  

 
	
 2.45

 	
  “Stock Appreciation Right Spread” means
 the amount by which the Fair Market Value, as of the Exercise Date, of the
 Shares as to which a Stock Appreciation Right is exercised exceeds the
 aggregate Exercise Price with respect to such Stock Appreciation Right.

 
	
  

 	
  

 
	
 2.46

 	
  “Stock Option”
 means a nonqualified stock option, as described in Section 6, that is not
 intended to meet the requirements of Code Section 422. 

 
	
  

 	
  

 
	
 2.47

 	
  “Stock Option Spread” means
 the amount by which the Fair Market Value, as of the Exercise Date, of the
 Shares as to which a Stock Option is exercised exceeds the aggregate Exercise
 Price with respect to such Shares.

 
	
  

 	
  

 
	
 2.48

 	
  “Successor” means
 the Participant’s spouse, the Participant’s lineal descendants, any trust the
 beneficiaries of which consist only of the Participant, the Participant’s
 spouse and/or the Participant’s lineal descendants, or to a corporation in
 which the Participant, the Participant’s spouse and/or the Participant’s
 lineal descendants own 100% of the economic interest and has the unfettered
 right to prevent further transfer or disposition of the Restricted Stock, Stock
 Option, Stock Appreciation Right, Restricted Stock Unit or Owned Shares,
 applicable. The Committee may, in its discretion, deem other parties to
 qualify as a Successor for purposes of this Plan.

 
	
  

 	
  

 
	
 2.49

 	
  “Terms and Conditions”
 means any electronic or written agreement or other instrument or document
 evidencing an Award.

 

-9-

	
  

 	
  

 
	
 2.50

 	
  “Valuation Date” means
 any Business Day. A Valuation Date shall also occur upon the consummation of
 a transaction constituting a Change in Control. 

 
	
  

 	
  

 
	
 2.51

 	
  “Withholding Tax” means
 the aggregate federal, state and local taxes, domestic or foreign, required
 by law or regulation to be withheld with respect to any taxable event arising
 under the Plan.

 

SECTION
3
Administration

	
  

 	
  

 
	
 3.1

 	
 Plan Administration.
 The Plan shall be administered by the Committee.

 
	
  

 	
  

 
	
 3.2

 	
 Authority of the Committee.
 Except as limited by law or the by-laws of the Company, and subject to the
 provisions of the Plan, the Committee shall have full power and discretion
 to: (a) select eligible Employees to participate in the Plan; (b) determine
 the size and type of Awards; (c) determine the terms and conditions of Awards
 in a manner consistent with the Plan;
 (d) determine whether, to what extent, and under what circumstances
 Awards may be settled or exercised in Shares, and the method or methods by
 which Awards may be settled or exercised; (e) determine the Fair Market Value
 of a Share; (f) construe and interpret the Plan and any agreement or
 instrument entered into under the Plan; (g) establish, amend or waive rules
 and regulations for the Plan’s administration; (h) specify the Exercise
 Price; and (i) subject to the provisions of Section 15.1, amend the terms and
 conditions of any outstanding Award to the extent the amended terms are
 within the Committee’s authority under the Plan. Further, the Committee shall
 make all other determinations that may be necessary or advisable to
 administer the Plan. The Committee may delegate some or all of its authority
 under the Plan to officers or employees of the Company or other Persons,
 except with respect to Awards to Executive Officers.

 
	
  

 	
  

 
	
 3.3

 	
 Decisions Binding.
 All determinations and decisions made by the Committee or by a Person or
 Persons delegated authority by the Committee pursuant to the provisions of
 the Plan shall be final, conclusive and binding on all Persons, including,
 without limitation, the Company, its shareholders, all Affiliates, Employees,
 Participants and their estates and beneficiaries.

 

SECTION
4
Shares
Subject to the Plan

	
  

 	
  

 
	
 4.1

 	
 Number of Shares Available for Grants.
 Subject to adjustment as provided in Sections 4.2 and 4.3, the number of
 Shares that may be issued or transferred to Participants under the Plan is
 18,000,000. No additional awards shall be made under the Prior Plans on or

 

-10-

	
  

 	
  

 
	
  

 	
 after the Original Effective Date. Subject to adjustment as provided
 in Section 4.3, to the extent necessary to comply with Section 162(m), the
 maximum number of Shares or Share equivalent units that may be granted during
 any fiscal year to any one Participant under Options, SARs, Restricted Stock,
 Restricted Stock Units, Performance Awards or other Stock-Based Awards is
 $25,000,000, which limit will apply regardless of whether the compensation is
 paid in Shares or in cash. To the extent necessary to comply with Code
 Section 162(m) the maximum aggregate dollar amount that may be paid to any
 one Participant during any fiscal year under Performance Awards or any
 cash-based Award under Section 9 is $25,000,000. 

 
	
  

 	
  

 
	
 4.2

 	
 Lapsed Awards. If
 any Award granted under this Plan or a Prior Plan is canceled, terminates,
 expires or lapses for any reason, any Shares subject to such award will again
 be available for the grant of an Award under the Plan. Common Stock issued
 through the assumption or substitution of outstanding grants from an acquired
 company shall not reduce the shares available for Awards under the Plan. In
 addition, if a Share subject to an Award is not delivered because the award
 is settled in cash, then that Share will thereafter be deemed to be available
 for grant. If a Share subject to an Award is not delivered because it is used
 to satisfy a tax withholding obligation or used to pay the Exercise Price of
 an Option, then that share will not thereafter be deemed to be available for
 grant.

 
	
  

 	
  

 
	
 4.3

 	
 Adjustments in Authorized Shares.
 If the Shares, as currently constituted, are changed into or exchanged for a
 different number or kind of shares of stock or other securities of the
 Company or of another corporation (whether because of a merger,
 consolidation, recapitalization, reclassification, split, reverse split,
 combination of shares, or otherwise, but not including a capital infusion
 from any source) or if the number of Shares is increased through the payment
 of a stock dividend, then the Committee shall substitute for or add to each
 Share that may become subject to an Award the number and kind of shares of
 stock or other securities into which each outstanding Share was changed, for
 which each such Share was exchanged, or to which each such Share is entitled,
 as the case may be. 

 
	
  

 	
  

 
	
 4.4

 	
 Sources of Shares Deliverable under Awards. Any Shares delivered pursuant to an
 Award may consist, in whole or in part, of authorized and unissued Shares or
 of treasury Shares.

 

SECTION 5

Eligibility and
Participation

	
  

 	
  

 
	
 5.1

 	
 Eligibility. Any
 Employee, including any officer or employee-director of the Company or an
 Affiliate, shall be eligible to be designated a Participant. To be eligible,
 a

 

-11-

	
  

 	
  

 
	
  

 	
 Participant shall have signed and delivered to the Company the
 Confidentiality and Non-Competition Agreement delivered by the Company to the
 Participant.

 
	
  

 	
  

 
	
 5.2

 	
 Actual Participation.
 The Committee shall determine the eligible Employees to whom it will grant
 Awards. 

 

SECTION
6

Stock Options

	
  

 	
  

 	
  

 
	
 6.1

 	
 Grant of Stock Options. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Subject to the terms and provisions of the Plan, the Committee may
 grant Stock Options to any Participant in the number, and upon the terms, and
 at such time or times, as the Committee determines and sets forth in the
 Terms and Conditions.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Each Stock Option grant shall be evidenced by the Terms and
 Conditions that specifies the duration of the Stock Option, the number of
 Shares to which the Stock Option pertains, the manner, time, and rate of
 exercise and vesting of the Stock Option, and such other provisions as the
 Committee determines. Vesting conditions may include, but not be limited to,
 the achievement of specific performance objectives (Company-wide, business
 unit, and/or individual) or continued Service.

 
	
  

 	
  

 	
  

 
	
 6.2

 	
 Exercise Price.
 The Terms and Conditions shall specify the Stock Option’s Exercise Price,
 which shall be not less than the Fair Market Value of a Share on the Grant
 Date.

 
	
  

 	
  

 	
  

 
	
 6.3

 	
 Duration of Stock Options.
 Each Stock Option will expire at the time determined by the Committee at the
 time of grant and set forth in the Terms and Conditions. 

 
	
  

 	
  

 	
  

 
	
 6.4

 	
 Exercise of Stock Options.
 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Stock Options shall become exercisable at such times and be subject
 to such vesting and other restrictions and conditions as the Committee in
 each instance approves and sets forth in each Terms and Conditions.
 Restrictions and conditions on the exercise of a Stock Option need not be the
 same for each Award or for each Participant. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 The holder of a Stock Option may exercise the Stock Option only by delivering
 a written notice of exercise to the Company setting forth the number of
 Shares as to which the Stock Option is to be exercised. Upon the Exercise
 Date, the holder shall pay or provide for the Exercise Price and applicable
 Withholding Tax in full,

 

-12-

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 pursuant to such procedures established by the Committee from time to
 time after giving consideration to applicable tax, securities and accounting
 rules

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 Any exercisable Stock Option that has not been exercised by its
 holder shall be automatically exercised in accordance with subsection (b)
 hereof on the Exercise Date immediately prior to its expiration if, on such
 Exercise Date, there is a Stock Option Spread with respect to such Stock
 Option. 

 
	
  

 	
  

 	
  

 	
  

 
	
 6.5

 	
 Termination of Service.
 Except as otherwise provided in the Terms and Conditions:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 In the event a Participant’s Service terminates by reason of death,
 Disability, or Retirement:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 The Applicable Fraction of the portion of any Stock Option held by
 such Participant which has not theretofore become exercisable shall
 immediately become vested and exercisable. 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 All Stock Options held by the Participant, to the extent exercisable
 (including by application of clause (i) above) as of the Participant’s termination
 of Service shall remain exercisable through the second anniversary of the
 date of termination of Service and shall thereafter expire.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (iii)

 	
 Any unvested portion of the Participant’s Stock Options as of the
 date of termination (other than any portion thereof that becomes vested
 pursuant to clause (i) above) shall be forfeited and canceled, without
 consideration, on the date of termination. 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Except as provided in Section 6.8, in the event a Participant’s
 Service terminates other than by reason of death, Disability, or Retirement:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 Any unvested portion of the Participant’s Stock Options as of the
 date of termination shall be forfeited and canceled on the date of
 termination, and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 The vested portion, if any, of the Participant’s Stock Options shall
 remain exercisable through the ninetieth (90th) day after the Participant’s
 termination of Service. Any vested Stock Option remaining outstanding after
 such date shall thereafter expire.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 Notwithstanding the foregoing, the Committee may, in its sole
 discretion, accelerate the vesting and exercisability, and/or extend the
 period of exercisability, of all or a portion of a Stock Option at any time
 as permitted by Section 409A.

 

-13-

	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 In no event shall a Stock Option be exercisable following its
 expiration date.

 
	
  

 	
  

 	
  

 
	
 6.6

 	
 Nontransferability of Stock Options.

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Except as otherwise provided in Section 6.6(b), a Participant’s Terms
 and Conditions, or the Plan, during the Restriction Period, (i) no Stock
 Option granted under the Plan may be sold, transferred, pledged, assigned, or
 otherwise alienated or hypothecated, other than by will or by the laws of
 descent and distribution, and (ii) all Stock Options shall be exercisable
 during the Participant’s lifetime only by the Participant or his or her
 guardian or legal representative. The Committee may, in its sole discretion,
 require a Participant’s guardian or legal representative to supply it with
 the evidence the Committee deems necessary to establish the authority of the
 guardian or legal representative to act on behalf of the Participant.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Subject to applicable law, vested Stock Options may be transferred to
 a Successor. Such transferred Stock Options may only be further sold,
 transferred, pledged, assigned or otherwise alienated by the Successor in
 accordance with this Section 6.6, and shall be subject in all respects to the
 terms of the Terms and Conditions and the Plan. For a transfer to be
 effective, the Successor shall promptly furnish the Company with written
 notice thereof and a copy of such other evidence as the Committee may deem
 necessary to establish the validity of the transfer and the acceptance of the
 Successor of the terms and conditions of the Plan.

 
	
  

 	
  

 	
  

 
	
 6.7

 	
 Dividend Equivalents and Other
 Distributions. The Committee may, in its sole
 discretion, provide under an agreement for payments in connection with Stock
 Options that are equivalent to dividends or other distributions declared and
 paid on the Shares underlying the Stock Options prior to the date of
 exercise. Such dividend equivalent agreement, if any, shall be separate and
 apart from the Terms and Conditions and shall be designed to comply
 separately with Section 409A.

 
	
  

 	
  

 	
  

 
	
 6.8

 	
 Change in Control.
 If, within twelve months following a Change in Control, (i) a Participant is
 terminated by the Company or an employing Affiliate (that is not a Joint
 Venture) without Cause or (ii) such Participant resigns from the Company or
 an employing Affiliate (that is not a Joint Venture) for Good Reason, the
 unvested portion of any then outstanding Stock Option shall vest and become
 exercisable. 

 
	
  

 	
  

 	
  

 
	
 6.9

 	
 Employment in a Joint Venture.
 If a Participant becomes an employee of certain joint ventures of the
 Company, as determined by the Board from time to time (a “Joint Venture”), during the Restriction
 Period, vesting of the Participant’s Stock Options shall be tolled beginning
 on the date such Participant becomes an employee of the Joint Venture until
 the date such Participant again becomes an Employee. Accordingly, the

 

-14-

	
  

 	
  

 
	
  

 	
 Restriction Period for such Participant’s Stock Options shall be
 extended by the number of days the Participant was an employee of the Joint
 Venture.

 

SECTION 7

Stock Appreciation Rights

	
  

 	
  

 	
  

 
	
 7.1

 	
 Grant of Stock Appreciation Rights. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Subject to the terms and provisions of the Plan, the Committee may
 grant Stock Appreciation Rights to any Participant in the number, and upon
 the terms, and at such time or times, as the Committee determines and sets
 forth in the Terms and Conditions.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Each Stock Appreciation Right grant shall be evidenced by the Terms
 and Conditions that specifies the duration of the Stock Appreciation Right,
 the number of Shares to which the Stock Appreciation Right pertains, the
 manner, time, and rate of exercise and vesting of the Stock Appreciation
 Right, and such other provisions as the Committee determines. Vesting
 conditions may include, but not be limited to, the achievement of specific
 performance objectives (Company-wide, business unit, and/or individual) or
 continued Service.

 
	
  

 	
  

 	
  

 
	
 7.2

 	
 Exercise Price.
 The Terms and Conditions shall specify the Stock Appreciation Right’s
 Exercise Price, which shall be not less than the Fair Market Value of a Share
 on the Grant Date. 

 
	
  

 	
  

 	
  

 
	
 7.3

 	
 Duration of Stock Appreciation Rights.
 Each Stock Appreciation Right will expire at the time determined by the
 Committee at the time of grant and set forth in the Terms and Conditions. 

 
	
  

 	
  

 	
  

 
	
 7.4

 	
 Exercise of Stock Appreciation Rights.
 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Stock Appreciation Rights shall become exercisable at such times and
 be subject to such vesting and other restrictions and conditions as the
 Committee in each instance approves and sets forth in each Terms and
 Conditions. Restrictions and conditions on the exercise of a Stock Appreciation
 Right need not be the same for each Award or for each Participant. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 The holder of a Stock Appreciation Right may exercise the Stock
 Appreciation Right only by delivering a written notice of exercise to the
 Company setting forth the number of Stock Appreciation Rights to be
 exercised. The Stock Appreciation Right Spread may be settled, as set forth
 in the Terms and Conditions, by delivery by the Company of the number of
 Shares equal to the

 

-15-

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Stock Appreciation Right Spread, in which case the Participant shall
 on or before the Exercise Date pay or provide for the applicable Withholding
 Tax in full, pursuant to such exercise procedures established by the
 Committee from time to time after giving consideration to applicable tax, securities
 and accounting rules. Any exercisable Stock Appreciation Right that has not
 been exercised by its holder shall be automatically exercised in accordance
 with subsection (b) hereof on the Exercise Date immediately prior to its
 expiration if, on such Exercise Date, there is a Stock Appreciation Right
 Spread with respect to such Stock Appreciation Right. 

 
	
  

 	
  

 	
  

 	
  

 
	
 7.5

 	
 Termination of Service.
 Except as otherwise provided in the Terms and Conditions:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 In the event a Participant’s Service terminates by reason of death,
 Disability, or Retirement:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 The Applicable Fraction of the portion of any Stock Appreciation
 Right held by such Participant which has not theretofore become exercisable
 shall immediately become vested and exercisable. 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 All Stock Appreciation Rights held by the Participant, to the extent
 exercisable (including by application of clause (i) above) as of the
 Participant’s termination of Service shall remain exercisable through the
 second anniversary of the date of termination of Service and shall thereafter
 expire.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (iii)

 	
 Any unvested portion of the Participant’s Stock Appreciation Rights
 as of the date of termination (other than any portion thereof that becomes
 vested pursuant to clause (i) above) shall be forfeited and canceled, without
 consideration, on the date of termination. 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Except as provided in Section 7.8, in the event a Participant’s
 Service terminates other than by reason of death, Disability, or Retirement:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 Any unvested portion of the Participant’s Stock Appreciation Rights
 as of the date of termination shall be forfeited and canceled on the date of
 termination, and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 The vested portion, if any, of the Participant’s Stock Appreciation
 Rights shall remain exercisable through the ninetieth (90th) day after the
 Participant’s termination of Service. Any vested Stock Appreciation Right
 remaining outstanding after such date shall thereafter expire.

 

-16-

	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 Notwithstanding the foregoing, the Committee may, in its sole
 discretion, accelerate the vesting and exercisability, and/or extend the
 period of exercisability, of all or a portion of a Stock Appreciation Right
 at any time as permitted by Section 409A.

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 In no event shall a Stock Appreciation Right be exercisable following
 its expiration date.

 
	
  

 	
  

 	
  

 
	
 7.6

 	
 Nontransferability of Stock Appreciation
 Rights.

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Except as otherwise provided in Section 7.6(b), a Participant’s Terms
 and Conditions, or the Plan, during the Restriction Period, (i) no Stock Appreciation
 Right granted under the Plan may be sold, transferred, pledged, assigned, or
 otherwise alienated or hypothecated, other than by will or by the laws of
 descent and distribution, and (ii) all Stock Appreciation Rights shall be
 exercisable during the Participant’s lifetime only by the Participant or his
 or her guardian or legal representative. The Committee may, in its sole
 discretion, require a Participant’s guardian or legal representative to
 supply it with the evidence the Committee deems necessary to establish the
 authority of the guardian or legal representative to act on behalf of the
 Participant.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Subject to applicable law, vested Stock Appreciation Rights may be
 transferred to a Successor. Such transferred Stock Appreciation Rights may
 only be further sold, transferred, pledged, assigned or otherwise alienated
 by the Successor in accordance with this Section 7.6, and shall be subject in
 all respects to the terms of the Terms and Conditions and the Plan. For a
 transfer to be effective, the Successor shall promptly furnish the Company
 with written notice thereof and a copy of such other evidence as the
 Committee may deem necessary to establish the validity of the transfer and
 the acceptance of the Successor of the terms and conditions of the Plan.

 
	
  

 	
  

 	
  

 
	
 7.7

 	
 Dividend Equivalents and Other
 Distributions. The Committee may, in its sole
 discretion, provide under an agreement for payments in connection with Stock
 Appreciation Rights that are equivalent to dividends and other distributions
 declared and paid on the Shares underlying the Stock Appreciation Rights
 prior to the date of exercise. Such dividend equivalent agreement, if any,
 shall be separate and apart from the Terms and Conditions and shall be
 designed to comply separately with Section 409A.

 
	
  

 	
  

 	
  

 
	
 7.8

 	
 Change in Control.
 If, within twelve months following a Change in Control, (i) a Participant is
 terminated by the Company or an employing Affiliate (that is not a Joint
 Venture) without Cause or (ii) such Participant resigns from the Company or
 an employing Affiliate (that is not a Joint Venture) for Good Reason, the
 unvested portion of any then outstanding Stock Appreciation Right shall vest
 and become exercisable. 

 

-17-

	
  

 	
  

 
	
 7.9

 	
 Employment in a Joint Venture.
 If a Participant becomes an employee of certain joint ventures of the
 Company, as determined by the Board from time to time (a “Joint Venture”), during the Restriction
 Period, vesting of the Participant’s Stock Appreciation Rights shall be
 tolled beginning on the date such Participant becomes an employee of the
 Joint Venture until the date such Participant again becomes an Employee.
 Accordingly, the Restriction Period for such Participant’s Stock Appreciation
 Rights shall be extended by the number of days the Participant was an employee
 of the Joint Venture.

 

SECTION 8

Restricted Stock and
Restricted Stock Units

	
  

 	
  

 	
  

 
	
 8.1

 	
 Grant of Restricted Stock and Restricted
 Stock Units. Subject to the terms and provisions of
 the Plan, the Committee may, at any time and from time to time, grant
 Restricted Stock or Restricted Stock Units to any Participant in such amounts
 as it determines and sets forth in the Terms and Conditions.

 
	
  

 	
  

 	
  

 
	
 8.2

 	
 Terms and Conditions.
 Each grant of Restricted Stock or Restricted Stock Units shall be evidenced
 by the Terms and Conditions that specifies the Restriction Period, the number
 of Shares or Restricted Stock Units granted, the purchase price, if any, and
 such other provisions as the Committee determines.

 
	
  

 	
  

 	
  

 
	
 8.3

 	
 Nontransferability.
 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Except as provided in Section 8.3(b), during the Restricted Period,
 (i) no Restricted Stock or Restricted Stock Unit granted under the Plan may
 be sold, transferred, pledged, assigned, or otherwise alienated or
 hypothecated, other than by will or by the laws of descent and distribution
 and (ii) all rights with respect to Restricted Stock or Restricted Stock
 Units shall be available during the Participant’s lifetime only to the
 Participant or the Participant’s guardian or legal representative. The
 Committee may, in its sole discretion, require a Participant’s guardian or
 legal representative to supply it with evidence the Committee deems necessary
 to establish the authority of the guardian or legal representative to act on
 behalf of the Participant.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Subject to applicable law, Restricted Stock may be transferred to a
 Successor. Such transferred Restricted Stock may only be further sold,
 transferred, pledged, assigned or otherwise alienated by the Successor in
 accordance with this Section 8.3, and shall be subject in all respects to the
 terms of the Terms and Conditions and the Plan. For a transfer to be
 effective, the Successor shall promptly furnish the Company with written
 notice thereof and a copy of such other evidence as the

 

-18-

	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Committee may deem necessary to establish the validity of the
 transfer and the acceptance of the Successor of the terms and conditions of
 the Plan.

 
	
  

 	
  

 	
  

 
	
 8.4

 	
 Termination of Service. Except as provided in Section 8.5, if a Participant’s Service terminates,
 then except as otherwise provided in the Terms and Conditions all unvested
 Restricted Stock and Restricted Stock Units held by such Participant will be
 forfeited and any vested Restricted Stock and Restricted Stock Units shall
 continue to be subject to the terms of the Plan and any applicable Award. 

 
	
  

 	
  

 	
  

 
	
 8.5

 	
 Change in Control. If, within twelve months following a
 Change in Control, (i) a Participant is terminated by the Company or an
 employing Affiliate (that is not a Joint Venture) without Cause or (ii) such
 Participant resigns from the Company or an employing Affiliate (that is not a
 Joint Venture) for Good Reason, all then outstanding Restricted Stock and
 Restricted Stock Units shall vest and become nonforfeitable.

 
	
  

 	
  

 	
  

 
	
 8.6

 	
 Other Conditions. The Committee may impose such other conditions and
 restrictions on any Restricted Stock and Restricted Stock Units as it deems
 advisable and sets forth in the Terms and Conditions, including, without
 limitation, vesting restrictions based upon the achievement of specific
 performance objectives (Company-wide, business unit, and/or individual) or
 continued Service, and/or restrictions under applicable federal or state
 securities laws. The Committee may provide that restrictions established
 under this Section 8.6 as to any given Award will lapse all at once or in
 installments.

 
	
  

 	
  

 	
  

 
	
 8.7

 	
 Voting Rights. Except as otherwise provided in the Terms and
 Conditions, and subject to Section 13.1(c), a Participant holding Shares of
 Restricted Stock may exercise any voting rights that apply to those Shares
 during the Restriction Period. 

 
	
  

 	
  

 	
  

 
	
 8.8

 	
 Dividends and Other
 Distributions.
 During the Restriction Period, a Participant holding Shares of Restricted
 Stock or Restricted Stock Units shall be credited with regular dividends or
 dividend equivalents and other distributions paid on those Shares. Such
 dividends or dividend equivalents and other distributions shall be subject to
 the same vesting conditions as the underlying Shares or Restricted Stock
 Units, and shall be paid within 30 days following the end of the Restriction
 Period.

 
	
  

 	
  

 	
  

 
	
 8.9

 	
 Section 83(b)
 Elections on Restricted Stock. The Participant, if subject to taxation in the United States with
 respect to any compensation derived under the Plan, shall indicate to the
 Company whether the Participant intends to make an election under Code
 Section 83(b) with respect to the Restricted Stock.

 
	
  

 	
  

 	
  

 
	
 8.10

 	
 Employment in a
 Joint Venture. If a
 Participant becomes an employee of a Joint Venture during the Restriction
 Period, vesting of the Participant’s Restricted Stock and Restricted Stock
 Units shall be tolled beginning on the date such Participant becomes an
 employee of the Joint Venture and shall recommence on the date such
 Participant again becomes an Employee. Accordingly, the Restriction Period
 for such Participant’s

 

-19-

	
  

 	
  

 
	
  

 	
 Restricted Stock and Restricted Stock Units
 shall be extended by the number of days the Participant was an employee of
 the Joint Venture. 

 
	
  

 	
  

 
	
 8.11

 	
 Payment of
 Restricted Stock Units. Each Restricted Stock Unit shall be payable to the Participant in such
 form provided in the Terms and Conditions following the last day of the
 Restriction Period, or on such later date provided in the Terms and
 Conditions or pursuant to a deferral agreement between the Participant and
 the Company.

 

SECTION
9
Performance
Awards

	
  

 	
  

 	
  

 
	
 9.1

 	
 Grant of
 Performance Awards. The Committee shall have the
 authority to determine (i) the Participants who shall receive Performance
 Awards, (ii) the size, number, amount or value, as applicable, of Performance
 Awards, and (iii) the Performance Criteria applicable in respect of such
 Performance Awards for each Performance Period. The Committee shall determine
 the duration of each Performance Period (which may differ from each other),
 and there may be more than one Performance Period in existence at any one
 time as to any Participant or all or any class of Participants. Each grant of
 Performance Awards shall be evidenced by the Terms and Conditions that shall
 specify the Performance Criteria applicable thereto and such other terms and
 conditions not inconsistent with the Plan as the Committee shall determine. 

 
	
  

 	
  

 	
  

 
	
 9.2

 	
 Earning of
 Performance Awards. The grant and/or vesting of
 Performance Awards shall be contingent, in whole or in part, upon the
 attainment of specified Performance Criteria or the occurrence of any event
 or events involving a Change in Control, death or Disability, as the
 Committee shall determine. In addition to the achievement of the specified
 Performance Criteria, the Committee may, at the grant date, condition earning
 of Performance Awards on the Participant completing a minimum period of
 service following the Grant Date or on such other conditions as the Committee
 shall specify.

 
	
  

 	
  

 	
  

 
	
 9.3

 	
 Performance Awards and Code Section 162(m). The provisions of this Section
 9.3 shall apply with respect to any Performance Award that is intended to
 meet the Performance-Based Exception. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Establishment of Performance Criteria. The
 Committee shall establish the Performance Criteria for the applicable
 Performance Period no later than the 90th day after the
 Performance Period begins (or by such other date as may be required under
 Section 162(m)) but in any event at a time when achievement of the
 Performance Criteria is substantially uncertain. The Committee may not in any
 event increase the amount of compensation payable to an Executive Officer
 upon attainment of the Performance Criteria above the maximum amount approved
 by the Committee at the time the Performance Criteria is established. 

 

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 (b)

 	
 Certification of Attainment
 of Performance Criteria. As soon as practicable after the end of a Performance Period
 and prior to any payment in respect of such Performance Period, the Committee
 shall certify in writing the amount, number or value, as applicable, of the
 Performance Awards that have been earned on the basis of performance in
 relation to the established Performance Criteria.

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 Payment
 of Awards. Earned
 Performance Awards shall be distributed to the Participant or, if the
 Participant has died, to the Participant’s Designated Beneficiary as soon as
 practicable after the expiration of the Performance Period and the
 Committee’s certification under Section 9.3(b) above, provided that,
 unless the payment of a Performance Award has been deferred in accordance
 with Section 409A of the Code, distributions of a Performance Award shall be
 made no later than March 15 of the year following the year in which the
 amount is earned.

 

SECTION
10
Other Stock-Based Awards

	
  

 	
  

 
	
 10.1

 	
 The Committee shall have authority to grant
 to eligible Participants an “Other Stock-Based Award,” which shall
 consist of any right which (i) is not a Stock Option, Stock Appreciation
 Right, Restricted Stock Unit or Restricted Stock and (ii) is an Award of
 Shares or an Award denominated or payable in, valued in whole or in part by
 reference to, or otherwise based on or related to, Shares (including, without
 limitation, securities convertible into Shares), as deemed by the Committee
 to be consistent with the purposes of the Plan. Subject to the terms of the
 Plan and any applicable Terms and Conditions, the Committee shall determine
 the terms and conditions of any such Other Stock-Based Award.

 

SECTION
11
Share Restrictions and Purchase and Sale Rights

	
  

 	
  

 
	
 11.1

 	
 Restrictions. The Committee may
 impose such restrictions on any Shares as it deems necessary or advisable,
 including, without limitation, restrictions under applicable federal
 securities laws, under the requirements of any stock exchange or market upon
 which the Shares are then listed and/or traded, and under any blue sky or
 state securities laws. 

 
	
  

 	
  

 
	
 11.2

 	
 Additional
 Conditions of Transfer. The Company shall not be required (i) to transfer on its books any
 Shares that have been sold or transferred, or (ii) to treat as owner of such
 Shares, to accord the right to vote as such owner, or to pay dividends to any
 transferee to whom such Shares have been transferred in violation of the Plan
 or any Terms and Conditions. 

 

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SECTION
12
Beneficiary Designation

	
  

 	
  

 
	
 12.1

 	
 Each Participant may, from time to time,
 name any Designated Beneficiary (who may be named contingently or
 successively) to whom any benefit under the Plan is to be paid in case the
 Participant should die before receiving any or all of his or her benefits
 under the Plan. Each beneficiary designation shall revoke all prior
 designations by the same Participant, must be in a form prescribed by the
 Committee and must be made during the Participant’s lifetime. 

 

SECTION
13
Breach of Restrictive Covenants

	
  

 	
  

 	
  

 
	
 13.1

 	
 The Terms and Conditions may provide that
 if the Participant breaches, whether during or after termination of Service,
 a nonsolicitation, noncompetition, confidentiality, or other restrictive
 covenant by which he or she is bound, then in addition to any other penalties
 or restrictions that may apply under any such agreement, state law, or
 otherwise, the Participant shall forfeit:

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Any Awards granted to him or her under the
 Plan, including Awards that have become exercisable;

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 The profit the Participant realized from
 the exercise of any Stock Options or Stock Appreciation Rights that the
 Participant exercised after terminating Service and within the six-month
 period immediately preceding the Participant’s termination of Service, which
 is the Stock Option Spread or Stock Appreciation Right Spread associated with
 any Shares acquired by the Participant upon his or her exercise of such Stock
 Options or such Stock Appreciation Rights; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 The Fair Market Value, as determined on the
 vesting date, of any Restricted Stock that vested or Restricted Stock Unit
 that was settled within the six-month period immediately preceding the
 Participant’s termination of Service.

 

SECTION
14

Rights of Participants

	
  

 	
  

 
	
 14.1

 	
 Service. Nothing in the Plan shall interfere with or limit
 in any way the right of the Company or any Affiliate to terminate any
 Participant’s Service at any time, or confer

 

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 upon any Participant any right to continue
 in the Service of the Company or any Affiliate. The grant of any Award under
 the Plan shall not in any way affect the right or power of the Company to
 make adjustments, reclassifications or changes in its capital or business
 structure, or to merge, consolidate, dissolve, liquidate, sell or transfer
 all or any part of its business or assets.

 
	
  

 	
  

 
	
 14.2

 	
 Participation. No Employee shall have the right to receive an
 Award under the Plan, or, having received any Award, to receive a future
 Award. 

 

SECTION
15
Amendment, Modification, Termination and Change in Control

	
  

 	
  

 	
  

 
	
 15.1

 	
 Amendment,
 Modification and Termination. The Board may at any time and from time to time alter, amend, modify or
 terminate the Plan in whole or in part, without the approval of the Company’s
 shareholders, except to the extent such approval is required by law. Subject
 to the terms and conditions of the Plan, the Committee may modify, extend or
 renew outstanding Awards under the Plan, or accept the surrender of
 outstanding Awards (to the extent not already exercised) and grant new Awards
 in substitution of them (to the extent not already exercised), in order to comply
 with the requirements of applicable law or otherwise. Notwithstanding the
 foregoing, no modification of an Award shall, without the prior written
 consent of the Participant, materially alter or impair any rights or
 obligations under any Award already granted under the Plan, except such an
 amendment made to comply with the requirements of applicable law.

 
	
  

 	
  

 	
  

 
	
 15.2

 	
 Adjustment of
 Awards upon the Occurrence of Certain Events.

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 In General. If the Shares, as currently constituted, are
 changed into or exchanged for a different number or kind of shares of stock
 or other securities of the Company or of another corporation (whether because
 of a merger, consolidation, recapitalization, reclassification, split,
 reverse split, combination of shares, or otherwise, but not including a
 capital infusion from any source) or if the number of Shares is increased
 through the payment of a stock dividend, then the Committee shall substitute
 for or add to each Share underlying an Award the number and kind of shares of
 stock or other securities into which each outstanding Share was changed, for
 which each such Share was exchanged, or to which each such Share is entitled,
 as the case may be, which shares or other securities shall be subject to the
 same terms and conditions as the underlying Award. Any such adjustment in an
 outstanding Stock Option or Stock Appreciation Right shall be

 

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 made with a corresponding adjustment in the
 Exercise Price for each Share or other unit of any security covered by such
 Stock Option or Stock Appreciation Right but without change in the aggregate
 purchase price applicable to the unexercised portion of such Stock Option. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Reciprocal Transactions. The Committee may, but shall not be obligated to,
 make an appropriate and proportionate adjustment to an Award or to the
 Exercise Price of any outstanding Award, and/or grant an additional Award to
 the holder of any outstanding Award, to compensate for the diminution in the
 intrinsic value of the Shares resulting from any reciprocal transaction.

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 Certain Unusual or Nonrecurring Events. In recognition of unusual or nonrecurring events
 affecting the Company or its financial statements, or in recognition of
 changes in applicable laws, regulations, or accounting principles, and,
 whenever the Committee determines that adjustments are appropriate in order
 to prevent dilution or enlargement of the benefits or potential benefits
 intended to be made available under the Plan, the Committee may, using
 reasonable care, make adjustments in the terms and conditions of, and the
 criteria included in, Awards. In no event will the Committee, unless
 otherwise approved by shareholders, be permitted (i) to reduce the Exercise
 Price of any outstanding Stock Option or Stock Appreciation Right, (ii)
 cancel a Stock Option or Stock Appreciation Right in exchange for cash or
 other Awards (except as provided in Section 15.4), (iii) exchange or replace
 an outstanding Stock Option or Stock Appreciation Right with a new Stock
 Option or Stock Appreciation Right with a lower Exercise Price, or (iv) take
 any other action that would be a “repricing” of Stock Options or Stock
 Appreciation Rights.

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

 	
 Notice. The Committee shall give notice of any adjustment
 to each Participant who holds an Award that has been adjusted and the
 adjustment (whether or not such notice is given) shall be effective and
 binding for all Plan purposes.

 
	
  

 	
  

 	
  

 
	
  

 	
 (e)

 	
 Section 409A. Notwithstanding any provision herein to the
 contrary, no adjustment shall be made under this Section 15.2 to the extent
 it would give rise to adverse tax consequences under Section 409A.

 
	
  

 	
  

 	
  

 
	
 15.3

 	
 Fractional Shares. Fractional
 Shares, whether resulting from any adjustment in Awards pursuant to Section
 15.2 or otherwise, may be settled in cash or otherwise as the Committee
 determines. 

 
	
  

 	
  

 	
  

 
	
 15.4

 	
 Change in Control. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 If, within twelve months following a Change
 in Control, (i) a Participant is terminated by the Company or an employing
 Affiliate (that is not a Joint Venture)

 

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 without Cause or (ii) such Participant
 resigns from the Company or an employing Affiliate (that is not a Joint
 Venture) for Good Reason, all then outstanding Awards shall become fully
 vested. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Any Award that has not been fully exercised
 before the date of a Change in Control may be settled or otherwise terminated
 on such date in the discretion of the Committee, unless a provision has been
 made in writing in connection with such transaction for the assumption of all
 Awards theretofore granted, or the substitution for such Awards of awards to
 acquire the stock of the surviving, resulting or acquiring corporation, with
 any adjustments as the Committee determines appropriate, in which event the
 Awards theretofore granted shall continue in the manner and under the terms
 so provided. Notwithstanding anything in the Plan to the contrary, any
 underwater Award that has not been fully exercised, and any
 Award that the Committee determines cannot become vested, before the date of consummation of the Change in
 Control may be canceled without consideration in the discretion of the
 Committee.

 
	
  

 	
  

 	
  

 
	
 15.5

 	
 Tax Withholding. The Company shall have the right to deduct or
 withhold, or require a Participant to remit to the Company, an amount (either
 in cash or Shares) sufficient to satisfy any Withholding Tax.

 

SECTION
16
Miscellaneous Provisions

	
  

 	
  

 	
  

 
	
 16.1

 	
 Successors. All
 obligations of the Company under the Plan or any Terms and Conditions shall
 be binding on any successor to the Company, whether the existence of the
 successor results from a direct or indirect purchase of all or substantially
 all of the Company’s stock, or a merger or consolidation, or otherwise.

 
	
  

 	
  

 	
  

 
	
 16.2

 	
 Legal Construction.

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 Number. Except where otherwise indicated by the context,
 any plural term used in the Plan includes the singular and any singular term
 includes the plural.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Severability. If any provision of the Plan is held illegal or
 invalid for any reason, the illegality or invalidity shall not affect the
 remaining parts of the Plan, and the Plan shall be construed and enforced as
 if the illegal or invalid provision had not been included.

 
	
  

 	
  

 	
  

 
	
 16.3

 	
 Business Day. In
 the event the day prescribed for the performance of any act under the Plan,
 or deadline by which such act must be performed, shall fall on a day other
 than a

 

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 Business Day, such day or deadline shall be
 extended until the close of business on the next succeeding Business Day.

 
	
  

 	
  

 	
  

 
	
 16.4

 	
 Requirements of Law. The granting of Awards, the issuance of Shares
 and the payment of cash under the Plan shall be subject to all applicable
 laws, rules and regulations, and to any approvals by governmental agencies or
 national securities exchanges as may be required.

 
	
  

 	
  

 	
  

 
	
 16.5

 	
 Rights of a
 Shareholder. A Participant shall not be, nor shall a
 Participant have any of the rights and privileges of, a shareholder until
 certificates for the underlying Shares have been issued or the underlying
 Shares have been registered as a book-entry in the name of the Participant.

 
	
  

 	
  

 	
  

 
	
 16.6

 	
 Securities Law
 Compliance. 

 
	
  

 	
  

 	
  

 
	
  

 	
 (a)

 	
 As to any individual who is, on the
 relevant date, an officer, director or greater than 10% percent beneficial
 owner of any class of the Company’s equity securities that is registered
 pursuant to Section 12 of the Exchange Act, all as defined under Section 16
 of the Exchange Act, transactions under the Plan are intended to comply with
 all applicable conditions of Rule 16b-3 under the Exchange Act, or any
 successor rule. To the extent any provision of the Plan or action by the
 Committee fails to so comply, it shall be deemed null and void, to the extent
 permitted by law and deemed advisable by the Committee.

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 To the extent the Committee deems it
 necessary, appropriate or desirable to comply with state securities laws or
 practice and to further the purposes of the Plan, the Committee may, without
 amending the Plan, (i) establish rules applicable to Awards granted to
 Participants, including rules that differ from those set forth in the Plan,
 and (ii) grant Awards to such Participants in accordance with those rules
 that would require the application of the securities laws of any state.

 
	
  

 	
  

 	
  

 
	
 16.7

 	
 Unfunded Status of
 the Plan. The Plan
 is intended to constitute an “unfunded” plan for incentive compensation. With
 respect to any payments or deliveries of Shares not yet made to a Participant
 by the Company, the Participant’s rights are no greater than those of a
 general creditor of the Company. The Committee may authorize the
 establishment of trusts or other arrangements to meet the obligations created
 under the Plan, so long as the arrangement does not cause the Plan to lose
 its legal status as an unfunded plan.

 
	
  

 	
  

 	
  

 
	
 16.8

 	
 Non-U.S. Based
 Participant.
 Notwithstanding any other provision of the Plan to the contrary, the
 Committee may make Awards to Participants who are not citizens or residents
 of the United States, or to Participants outside the United States, on terms
 and conditions that are different from those specified in the Plan as may, in
 the Committee’s judgment, be necessary or desirable to foster and promote
 achievement of the Plan’s

 

-26-

	
  

 	
  

 
	
  

 	
 purposes. In furtherance of such purposes,
 the Committee may, without amending the Plan, establish or modify rules,
 procedures and subplans as may be necessary or advisable to comply with
 provisions of laws in other countries or jurisdictions in which the Company
 operates or has employees.

 
	
  

 	
  

 
	
 16.9

 	
 Governing Law. To the extent not preempted by Federal law, the
 Plan and all agreements hereunder shall be construed and enforced in
 accordance with, and governed by, the laws of the State of New York, without
 giving effect to its conflicts of law principles that would require the
 application of the law of any other jurisdiction.

 
	
  

 	
  

 
	
 16.10

 	
 Section 162(m). The
 Plan is intended to be administered, interpreted and construed so that Awards
 remain tax deductible to the Company and unlimited by Section 162(m), which
 restricts under certain circumstances the Federal income tax deduction for
 compensation paid by a public company to Executive Officers in excess of $1
 million per year. As of the Plan’s effective date, the exemption is based on
 Treasury Regulation Section 1.162-27(f), which generally exempts from the
 application of Section 162(m) compensation paid pursuant to a plan that
 existed before a company becomes publicly held. Under such Treasury
 Regulation, this exemption is available to the Plan with respect to certain
 Awards for the duration of the period that lasts until the earlier of the
 expiration or material modification of the Plan or the first meeting of stockholders
 at which directors are to be elected that occurs after the close of the third
 calendar year following the calendar year in which the Company first becomes
 subject to the reporting obligations of Section 12 of the Exchange Act. To
 the extent that the Committee determines that the exemption described in this
 Section 16.10 is no longer available with respect to an Award that would
 otherwise be intended to satisfy the Performance-Based Exception, such Award
 shall be contingent upon shareholder approval of the Plan and related Award
 in accordance with Section 162(m). 

 
	
  

 	
  

 
	
 16.11

 	
 Recoupment. Notwithstanding any provision in the Plan to the
 contrary, Awards granted or paid under the Plan will be subject to recoupment
 by the Company pursuant to any “clawback” or similar compensation recoupment
 policy that may be established by the Company.

 

-27-

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