Exhibit 10.16b
Form of
Stock Option Agreement for Elective 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 8(e) 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 , 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)(ii) hereof.
(ii) Extension of Term.
The term of exercise of all outstanding Stock Options held
by a Non-Employee Director that have a remaining term of less than
one year on the date of such Non-Employee Director’s death
shall automatically be extended to the first anniversary of the
date of death.
3. Post-Directorship
Exercises . The exercise of any Stock Option after a
Non-Employee Director ceases to serve as a director shall be
subject to satisfaction of the conditions precedent that the former
Non-Employee Director neither (i) competes with, or takes
employment with or renders services as a director or in any other
capacity to a competitor of, the Company, its subsidiaries or
affiliates without the written consent of the Company, nor (ii)
conducts himself or herself in a manner adversely affe
