Exhibit 10.16a
Form of
Stock Option Agreement for Annual Stock
Options
Under
The Estée Lauder Companies
Inc.
Non-Employee Director Share
Incentive Plan (the “Plan”)
This STOCK OPTION AGREEMENT provides
for the granting of Stock Options (“Options”) by The
Estée Lauder Companies Inc., a Delaware corporation (the
“Company”), to the participant, a Non-Employee Director
of the Company (a “Non-Employee Director”), to purchase
shares of the Company’s Class A Common Stock, par value $0.01
(the “Shares”), on the terms and subject to the
conditions hereinafter provided. The Stock Options described
herein are being granted pursuant to Section 6(a) of the
Company’s Non-Employee Director Share Incentive Plan, as may
be amended or restated from time to time (the “Plan”),
and are subject in all respects to the provisions of the
Plan. The Stock Options granted hereunder are not Incentive
Stock Options (as defined in Section 422(b) of the Internal
Revenue Code of 1986, as amended (the “Code”)).
This Stock Option Agreement incorporates and is subject to all
terms, conditions, limitations and restrictions contained in the
Plan, which shall be controlling in the event of any conflicting or
inconsistent provisions. Capitalized terms not defined herein
shall have the meanings ascribed thereto in the Plan.
The name of the “Non-Employee
Director”, the “Grant Date”, the aggregate number
of Shares that may be purchased pursuant to this agreement, and the
“Exercise Price” per Share are stated in the attached
“Notice of Grant”, and incorporated herein by
reference. The other terms and conditions of the Options are
stated in this agreement and in the Plan.
1. Payment of Exercise
Price. The Company will provide and communicate to the
Non-Employee Director various methods of exercise. These
methods may include the ability to receive Shares of Class A Common
Stock of the Company or cash at exercise. To facilitate
exercise, the Company may enter into agreements for coordinated
procedures with one or more brokerage firms or financial
institutions.
2. Exercise
Period.
(i). General . Each
Stock Option granted to a Non-Employee Director hereunder shall
become exercisable beginning on the first anniversary of the date
of grant provided that the Non-Employee Director continues to serve
as a director of the Company on such anniversary date;
provided , however , any such Stock Option granted to
a Non-Employee Director shall become immediately exercisable in the
event of (A) a Change in Control of the Company or (B) the death of
the Non-Employee Director. Each Stock Option shall terminate
on the tenth anniversary of the date of grant unless terminated
earlier pursuant to the Plan or later pursuant to
Section 2(d)(iii) hereof. If a Non-Employee Director
ceases to serve as a director of the Company for any reason other
than as a result of a Change in Control or his or her death, each
Stock Option granted to such person less than one year prior to
cessation of service shall immediately terminate and become null
and void upon such cessation of service.
(ii). Termination of
Directorship . If a Non-Employee Director ceases to serve
as a director of the Company, any exercisable outstanding Stock
Option previously granted to such Non-Employee Director shall, to
the extent not theretofore exercised, remain exercisable at any
time up to and including a date that is five years after the date
of such cessation of service, except as set forth in
Section 2(d)(iii) hereof, at which time such Stock Option
shall terminate and become null and void; provided ,
however , that no Stock Option shall be exercisable later
than ten years after the date of grant (except as set forth in
Section 2(d)(iii) hereof); provided , further ,
however , if the service of a Non-Employee Director ceases
by reason other than (A) death, (B) disability (as described in
Section 22(e)(3) of the Code), (C)
1
voluntary retirement from service as a director
of the Company, or (D) the failure of the Company to nominate for
re-election such Non-Employee Director who is otherwise eligible,
unless such failure to nominate for
