CERTIFICATE OF CHANGE

OF

AVON PRODUCTS, INC.

UNDER SECTION 805-A OF THE BUSINESS CORPORATION LAW

1.              The name of the Corporation is Avon Products, Inc.  It was incorporated under the name California Perfume Company, Inc.

2.              The Certificate of Incorporation of said corporation was filed by the Department of State on January 27, 1916.

3.              The following changes were authorized by the Board of Directors:

a)            To change the post office address to which the Secretary of State shall mail a copy of process in any action or proceeding against the corporation which may be served on him to: 601 Midland Avenue, Rye, NY 10580; and

b)            To change the county location, within the state of New York, in which the office of the Corporation is located to Westchester County.

 

		/s/ Ginny Edwards
		Ginny Edwards
		Vice President and Corporate Secretary

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CERTIFICATE OF AMENDMENT

OF

THE CERTIFICATE OF INCORPORATION

OF

AVON PRODUCTS, INC.

Under Section 805 of the Business Corporation Law of the State of New York

The undersigned, James S. Scully, Executive Vice President and Chief Financial Officer of Avon Products, Inc. (the “ Corporation ”), pursuant to the provisions of Sections 502 and 805 of the Business Corporation Law of the State of New York, does hereby certify as follows:

1.  The name of the Corporation is Avon Products, Inc. and the name under which the Corporation was formed is California Perfume Company, Inc.

2.  The Certificate of Incorporation forming the Corporation was filed by the Department of State of the State of New York on January 27, 1916.

3.  The Corporation is presently authorized to issue 25,000,000 shares of preferred stock having a par value of $1.00 per share (the “ Preferred Stock ”).  No series of Preferred Stock is presently outstanding.  As authorized by Section 502 of the Business Corporation Law of the State of New York (“ NYBCL ”) and Article III of the Corporation’s Restated Certificate of Incorporation, as amended (the “ Certificate of Incorporation ”), the Board of Directors of the Corporation has, before issuance, fixed the designation, preferences, privileges and voting power, and the restrictions and qualifications, of a new series of Preferred Stock to be known as Series C Preferred Stock.

4.  The Certificate of Incorporation is hereby amended by the addition of the provisions set forth below in this Certificate (this “ Certificate ”), setting forth the number, designation, preferences, privileges and voting power of the Series C Preferred Stock as fixed by the Board of Directors of the Corporation and the restrictions and qualifications thereof.

*    *    *    *    *

Pursuant to the authority expressly vested in the Board of Directors of the Corporation by the Certificate of Incorporation, the Board of Directors of the Corporation has duly authorized and approved, and created and provided for the issuance of, a series of Preferred Stock, in the amount and with the designation, preferences, privileges and voting powers and relative, participating, optional or other special rights, and any qualifications, limitations and restrictions thereof, as set forth below in this Certificate, which has been duly adopted by the Board of Directors of the Corporation.

SECTION 1.  Designation and Amount.   The shares of such series of Preferred Stock shall be designated as “Series C Preferred Stock” (the “ Series C Preferred Stock ”) and the number of authorized shares constituting the Series C Preferred Stock shall be 435,000.  Such

number of shares may be increased or decreased by resolution of the Board (as defined herein); provided that no decrease shall reduce the number of shares of Series C Preferred Stock to a number less than the number of shares of Series C Preferred Stock then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series C Preferred Stock.  Each share of Series C Preferred Stock shall rank equally in all respects and shall be subject to the following provisions of this Certificate.  The Corporation shall not have the authority to issue fractional shares of Series C Preferred Stock.

SECTION 2.  Definitions.   As used herein with respect to Series C Preferred Stock:

“ 5.0% Beneficial Ownership Requirement ” means that the Investor Parties continue to beneficially own at all times shares of Series C Preferred Stock and/or shares of Common Stock that represent, in the aggregate and on an as converted basis, at least 5.0% of the number of shares of Common Stock beneficially owned by the Investor Parties, on an as converted basis, as of the Issue Date, in each case as appropriately adjusted to account for any event that results in an adjustment to the Conversion Price in accordance with Section 10 .

“ 25.0% Beneficial Ownership Requirement ” means that the Investor Parties continue to beneficially own at all times shares of Series C Preferred Stock and/or shares of Common Stock that represent, in the aggregate and on an as converted basis, at least 25.0% of the number of shares of Common Stock beneficially owned by the Investor Parties, on an as converted basis, as of the Issue Date, in each case as appropriately adjusted to account for any event that results in an adjustment to the Conversion Price in accordance with Section 10 .

“ 50.0% Beneficial Ownership Requirement ” means that the Investor Parties continue to beneficially own at all times shares of Series C Preferred Stock and/or shares of Common Stock that represent, in the aggregate and on an as converted basis, at least 50.0% of the number of shares of Common Stock beneficially owned by the Investor Parties, on an as converted basis, as of the Issue Date, in each case as appropriately adjusted to account for any event that results in an adjustment to the Conversion Price in accordance with Section 10 .

“ 75.0% Beneficial Ownership Requirement ” means that the Investor Parties continue to beneficially own at all times shares of Series C Preferred Stock and/or shares of Common Stock that represent, in the aggregate and on an as converted basis, at least 75.0% of the number of shares of Common Stock beneficially owned by the Investor Parties, on an as converted basis, as of the Issue Date, in each case as appropriately adjusted to account for any event that results in an adjustment to the Conversion Price in accordance with Section 10 .

“ Affiliate ” means, with respect to any specified Person, any other Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such specified Person; provided that the Corporation and its Subsidiaries shall not be deemed to be Affiliates of the Investor or any of its Affiliates.  For the purposes of this definition, “ control ”, when used with respect to any specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “ controlling ” and “ controlled ” have meanings correlative to the foregoing.

Any Person shall be deemed to “ beneficially own ”, to have “ beneficial ownership ” of, or to be “ beneficially owning ” any securities (which securities shall also be deemed “ beneficially owned ” by such Person) that such Person is deemed to “beneficially own” within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act; provided that any Person shall be deemed to beneficially own any securities that such Person has the right to acquire, whether or not such right is exercisable immediately (including assuming conversion of all Series C Preferred Stock, if any, owned by such Person into shares of Common Stock).

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

“ Board Rights Waiver ” has the meaning set forth in Section 12(c)(vi) .

“ Business Day ”   means any weekday that is not a day on which banking institutions in New York, New York are authorized or required by law, regulation or executive order to be closed.

“ Bylaws ” means the Bylaws of the Corporation, as may be amended from time to time.

“ Capital Stock ” means any and all shares of, interests in, rights to purchase, warrants to purchase, options for, participations in or other equivalents of or interests in (however designated) stock issued by the Corporation.

“ Certificate ” has the meaning set forth in the recitals above.

“ Certificate of Incorporation ” has the meaning set forth in the recitals above.

“ Change of Control ” means the occurrence of one of the following:

(i) a “person” or “group” within the meaning of Section 13(d) of the Exchange Act obtains direct or indirect ultimate beneficial ownership of Voting Stock representing more than 50% of the voting power of the outstanding Voting Stock, other than any transaction in which Persons that beneficially owned, directly or indirectly, Voting Stock immediately prior to such transaction beneficially own, directly or indirectly, shares of capital stock representing a majority of the total voting power of all outstanding classes of shares of capital stock of the continuing or surviving Person or the ultimate resulting Parent Entity immediately after the transaction;

(ii) consummation of (x) any consolidation, merger or share exchange of the Corporation or any sale, lease or other transfer of all or substantially all of the consolidated assets of the Corporation and its Subsidiaries, taken as a whole, to any Person other than one or more of the Corporation’s Subsidiaries, in each case pursuant to which the Common Stock will be converted into, or receive a distribution of the proceeds in, cash, securities or other property or (y) any recapitalization, reclassification or other extraordinary transaction in which all or substantially all of the Common Stock is

exchanged for or converted into cash, securities or other property; provided that neither (x) nor (y) shall include any such consolidation, merger, share exchange, recapitalization, reclassification or similar extraordinary transactions in which Persons that beneficially owned, directly or indirectly, Voting Stock immediately prior to such transaction beneficially own, directly or indirectly, shares of capital stock representing a majority of the total voting power of all outstanding classes of shares of capital stock of the continuing or surviving Person or the ultimate resulting Parent Entity immediately after the transaction; or

(iii) any transaction or series of transactions by which the Corporation or any successor or Parent Entity thereof is organized outside the United States of America.

“ Change of Control Effective Date ” has the meaning set forth in Section 8(a) .

“ Change of Control Exchange ” has the meaning set forth in Section 8(a) .

“ close of business ” means 5:00 p.m. (New York City time).

“ Closing Price ” of the Common Stock on any date of determination means the closing sale price or, if no closing sale price is reported, the last reported sale price, of shares of Common Stock on the NYSE on such date.  If the Common Stock is not traded on the NYSE on any date of determination, the Closing Price of the Common Stock on such date of determination means the closing sale price as reported in the composite transactions for the principal United States securities exchange or automated quotation system on which the Common Stock is so listed or quoted, or, if no closing sale price is reported, the last reported sale price on the principal United States securities exchange or automated quotation system on which the Common Stock is so listed or quoted, or if the Common Stock is not so listed or quoted on a United States securities exchange or automated quotation system, the last quoted bid price for the Common Stock in the over-the-counter market as reported by OTC Market Group, Inc. or any similar organization, or, if that bid price is not available, the market price of the Common Stock on that date as determined by an Independent Financial Advisor retained by the Corporation for such purpose.

“ Common Stock ” means the common stock, par value $0.25 per share, of the Corporation or its successor.

“ Common Stock Requirements ” means:

(i) the arithmetic average of the VWAP per share of Common Stock for each of the ten (10) consecutive full Trading Days immediately prior to the payment of any Regular Dividend in Common Stock, exceeds $3.00 per share;

(ii) the average daily trading volume for the last thirty (30) Trading Days exceeds three (3) times the number of shares of Common Stock issued as a dividend under this Certificate, the Series D Certificate of Amendment or any other certificate of amendment of the Corporation providing for the issuance of preferred stock (collectively, the “ Preferred Certificates ”) within the last ninety (90) calendar days (including the current dividend payment);

(iii) the number of shares of Common Stock held by non-Affiliates of the Corporation exceeds ten (10) times the number of shares issued as a dividend under the Preferred Certificates within the last ninety (90) calendar days (including the current dividend payment);

(iv) a registration statement relating to all such shares of Common Stock to be issued with respect to any dividend payment shall be effective with the SEC and such shares shall be listed on the NYSE or another National Securities Exchange;

(v) the Corporation shall have obtained a Stockholder Approval for the issuance of Common Stock as dividends, if required by the rules of the NYSE or other National Securities Exchange on which the Common Stock is then listed or applicable law;

(vi) as of the date of payment of any Regular Dividend in Common Stock, pro forma for such payment, no default or event of default exists, under any agreement relating to material Debt of the Corporation or its Subsidiaries which is outstanding on the date of such Regular Dividend payment;

(vii) as of the date of payment of any Regular Dividend in Common Stock, pro forma for such payment, no Event of Noncompliance exists under the Preferred Certificates, other than an Event of Noncompliance which would be cured by such payment of a Regular Dividend or concurrent payment under the other Preferred Certificates;

(viii) shares of Common Stock being issued in such Regular Dividend payment shall not be subject to any transfer restrictions under any agreement between the Holder or its Affiliates, on the one hand, and the Corporation or its Subsidiaries, on the other hand;

(ix) neither the Holder receiving the shares of Common Stock nor, if applicable, the Preferred Directors are, on the date of such payment, subject to restrictions in trading in securities of the Corporation pursuant to the Corporation’s policies relating to trading in the securities (including restrictions on the Preferred Directors due to their possession of material nonpublic information); and

(x) no event has occurred that would require an adjustment pursuant to Section 10 between the time of the Closing Price on the Trading Day immediately prior to the payment of such Regular Dividend and such payment.

“ Constituent Person ” has the meaning set forth in Section 11(a) .

“ Conversion Agent ” means the Transfer Agent acting in its capacity as conversion agent for the Series C Preferred Stock, and its successors and assigns.

“ Conversion Cap ” has the meaning set forth in Section 6(c) .

“ Conversion Date ” has the meaning set forth in Section 7(a) .

“ Conversion Notice ” has the meaning set forth in Section 7(a) .

“ Conversion Price ” means, for each share of Series C Preferred Stock, $5.00, subject to adjustment as set forth herein.

“ Corporation ” has the meaning set forth in the recitals above.

“ Current Market Price ” means, for each share of Common Stock as of any applicable Record Date for any issuance, distribution, dividend or other action, the arithmetic average of the VWAP per share of Common Stock for each of the ten (10) consecutive full Trading Days ending on the Trading Day before the Record Date with respect to such issuance, distribution, dividend or other action, as the case may be, appropriately adjusted to take into account the occurrence during such period of any event described in Section 10 .

“ Debt ” has the meaning set forth in the Revolving Credit Agreement.

“ Disqualified Exchange Property ” has the meaning set forth in Section 11(a) .

“ Distributed Property ” has the meaning set forth in Section 10(a)(iii) .

“ Distribution Transaction ” means any transaction by which a Subsidiary of the Corporation ceases to be a Subsidiary of the Corporation by reason of the distribution of such Subsidiary’s equity securities to holders of Common Stock, whether by means of a spin-off, split-off, redemption, reclassification, exchange, stock dividend, share distribution, rights offering or similar transaction.

“ Dividend Payment Price ” means the arithmetic average of the VWAP per share of Common Stock for each of the five (5) consecutive full Trading Days ending on the Trading Day prior to the payment of a Regular Dividend in Common Stock.

“ Dividend Rate ” means 1.25%, as adjusted by Section 13(b) .

“ Event of Noncompliance ” has the meaning set forth in Section 13(a) .

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“ Exchange Property ” has the meaning set forth in Section 11(a) .

“ Expiration Date ” has the meaning set forth in Section 10(a)(ii) .

“ Fair Market Value ” means:

(i) with respect to any asset constituting cash or cash equivalents, the amount of such cash or cash equivalents, and

(ii) with respect to any security or other property (other than cash or cash equivalents), the fair market value of such security or other property:

(A) for so long as the Investor Parties hold any shares of Series C Preferred Stock, as determined by a majority of the Other Directors or an

authorized committee thereof (such committee to consist solely of Other Directors), in each case acting in good faith, (x) after consultation with an Independent Financial Advisor, as to any security or other property with a Fair Market Value of less than $25,000,000, or (y) after receipt of a valuation opinion from an Independent Financial Advisor in all other cases; and

 

(B) at such time as the Investor Parties no longer hold shares of Series C Preferred Stock, as reasonably determined by a majority of the Board or an authorized committee thereof, in each case acting in good faith.

“ Fall-Away of Investor Board Rights ” means the first day on which the 25.0% Beneficial Ownership Requirement is not satisfied.

“ Final Change of Control Notice ” has the meaning set forth in Section 8(c) .

“ Holder ” means a Person in whose name shares of the Series C Preferred Stock are registered, which Person shall be treated by the Corporation, Transfer Agent, Registrar, paying agent and Conversion Agent as the absolute owner of the shares of Series C Preferred Stock for the purpose of making payment and settling conversions and for all other purposes; provided that, to the fullest extent permitted by law, no Person that has received shares of Series C Preferred Stock in violation of Article V of the Investor Rights Agreement shall be a Holder, and the Transfer Agent, Registrar, paying agent and Conversion Agent, as applicable, shall not, unless directed otherwise by the Corporation, recognize any such Person as a Holder.

“ Independent Financial Advisor ” means an accounting, appraisal, investment banking firm or consultant of nationally recognized standing; provided , however , that such firm or consultant is (i) not an Affiliate of the Corporation and (ii) so long as the Investor Parties satisfy the 5.0% Beneficial Ownership Requirement, is reasonably acceptable to the Investor Parties.

“ Investment Agreement ” means the investment agreement between the Corporation and the Investor dated as of December 17, 2015.

“ Investor ” means Cleveland Apple Investor L.P. (f/k/a/ Cleveland Apple Investor LLC).

“ Investor Party ” or “ Investor Parties ”, as applicable, means the Investor and each Affiliate of the Investor to whom shares of Series C Preferred Stock or Common Stock are transferred pursuant to and in accordance with Section 5.02 of the Investor Rights Agreement.

“ Investor Related Parties ” has the meaning set forth in Section 15 .

“ Investor Rights Agreement ” means the investor rights agreement between the Corporation and the Investor dated as of the Closing Date (as defined in the Investment Agreement), with respect to certain terms and conditions concerning, among other things, additional rights of and restrictions on the Holders.

“ Investor Transactions ” has the meaning set forth in Section 15 .

“ Issuance Date ” means, with respect to any share of Series C Preferred Stock, the date of issuance of such share.

“ Issue Date ” means the Closing Date (as defined in the Investment Agreement).

“ Junior Stock ” means the Common Stock and any other class or series of Capital Stock now existing or hereafter authorized other than (i) the Series C Preferred Stock and the Series D Preferred Stock, (ii) any class or series of Parity Stock and (iii) any class or series of Senior Stock.  “Junior Stock” shall include any rights, options or warrants exercisable or exchangeable for or convertible into Junior Stock.

“ Liquidation Preference Amount ” has the meaning set forth in Section 5(a) .

“ Mandatory Conversion ” has the meaning set forth in Section 9(a) .

“ Majority Investor Parties ” means, as of any date of determination, Investor Parties that beneficially own (excluding any duplicative beneficial ownership) shares of Series C Preferred Stock and/or shares of Common Stock that were issued upon conversion of shares of Series C Preferred Stock that represent, in the aggregate and on an as converted basis, more than 50.0% of the number of shares of Series C Preferred Stock and/or shares of Common Stock that were issued upon conversion of shares of Series C Preferred Stock, on an as converted basis, held by the Investor Parties as of the applicable date of determination.

“ Market Disruption Event ” means any of the following events:

(a) any suspension of, or limitation imposed on, trading of the Common Stock by any exchange or quotation system on which the Closing Price is determined pursuant to the definition of the term “Closing Price” (the “ Relevant Exchange ”) during the one-hour period prior to the close of trading for the regular trading session on the Relevant Exchange (or for purposes of determining the VWAP per share of Common Stock, any period or periods aggregating one half-hour or longer during the regular trading session on the relevant day) and whether by reason of movements in price exceeding limits permitted by the Relevant Exchange as to securities generally, or otherwise relating to the Common Stock or options contracts relating to the Common Stock on the Relevant Exchange; or

(b) any event that disrupts or impairs (as determined by the Corporation in its reasonable discretion) the ability of market participants during the one-hour period prior to the close of trading for the regular trading session on the Relevant Exchange (or for purposes of determining the VWAP per share of Common Stock, any period or periods aggregating one half-hour or longer during the regular trading session on the relevant day) in general to effect transactions in, or to obtain market values for, the Common Stock on the Relevant Exchange or to effect transactions in, or to obtain market values for, options contracts relating to the Common Stock on the Relevant Exchange.

“ National Securities Exchange ” means the NYSE or the NASDAQ Stock Market.

“ North America Investment Agreement ” means the Separation and Investment Agreement, dated as of December 17, 2015, among the Corporation, C-A NA LLC, a wholly-owned Subsidiary of the Corporation, and Cleveland NA Investors LLC.

“ Notice of Mandatory Conversion ” has the meaning set forth in Section 9(b) .

“ NYBCL ” has the meaning set forth in the recitals above.

“ NYSE ” means the New York Stock Exchange and its successors.

“ Officer’s Certificate ” means a certificate signed by the Chief Executive Officer, the Chief Financial Officer or the Secretary of the Corporation.

“ Other Director ” means a member of the Board that is not appointed or elected solely by Holders of Series C Preferred Stock.

“ Parent Entity ” means, with respect to any Person, any other Person of which such first Person is a direct or indirect wholly owned subsidiary.

“ Parity Stock ” means any class or series of Capital Stock hereafter authorized that expressly ranks on a parity basis with the Series C Preferred Stock as to dividend rights, rights of redemption and rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation.  “Parity Stock” shall include the Series D Preferred Stock and any rights, options or warrants exercisable or exchangeable for or convertible into Parity Stock.

“ Participating Dividends ” has the meaning set forth in Section 4(a) .

“ Permitted Secured Debt ” means indebtedness of the Corporation and its Subsidiaries in an aggregate principal amount not to exceed the amount of indebtedness permitted to be secured by the terms the Revolving Credit Agreement and designated as “Permitted Secured Debt” by the Corporation to the Holders (it being understood that indebtedness incurred under the Revolving Credit Agreement shall be deemed to be “Permitted Secured Debt”).

“ Person ” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, estate, unincorporated organization, governmental entity or other entity.

“ Preferred Certificates ” has the meaning set forth in the definition of the term “ Common Stock Requirements ”.

“ Preferred Director ” has the meaning set forth in Section 12(c)(i) .

“ Preferred Stock ” has the meaning set forth in the recitals above.

“ Pro Rated Regular Dividends ” means, as of any date of determination, an amount of cash equal to the product of (i) the Stated Dividend Value multiplied by (ii) the product of (A) the Dividend Rate multiplied by (B) the lesser of one (1) and the quotient of (x) the number of days since, but not including, the last Regular Dividend Calculation Date to, and including, the date of determination, divided by (y) 90.

“ Qualifying Offer ” has the meaning set forth in Section 10(a)(ii) .

“ Record Date ” means, with respect to any dividend, distribution or other transaction or event in which the holders of the Common Stock have the right to receive any cash, securities or other property or in which the Common Stock (or other applicable security) is exchanged for or converted into any combination of cash, securities or other property, the date fixed for determination of holders of the Common Stock entitled to receive such cash, securities or other property (whether such date is fixed by the Board or by statute, contract or otherwise).

“ Registrar ” means the Transfer Agent acting in its capacity as registrar for the Series C Preferred Stock, and its successors and assigns.

“ Regular Dividend Calculation Date ” has the meaning set forth in Section 4(b) .

“ Regular Dividends ” has the meaning set forth in Section 4(b) .

“ Relevant Exchange ” has the meaning set forth in the definition of the term “Market Disruption Event”.

“ Revolving Credit Agreement ” means the revolving credit agreement, dated as of June 5, 2015, among, inter alios , the Corporation, Avon International Operations, Inc. and Citibank, N.A., as Administrative Agent, as in effect on December 17, 2015.

“ Reorganization Event ” has the meaning set forth in Section 11(a) .

“ SEC ” means the U.S. Securities and Exchange Commission.

“ Senior Stock ” means any class or series of Capital Stock hereafter authorized that expressly ranks senior to the Series C Preferred Stock and has preference or priority over the Series C Preferred Stock as to dividend rights, rights of redemption or rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation.  “Senior Stock” shall include any rights, options or warrants exercisable or exchangeable for or convertible into Senior Stock.

“ Series C Preferred Stock ” has the meaning set forth in Section 1 .

“ Series D Certificate of Amendment ” has the meaning set forth in the definition of the term “Series D Preferred Stock”.

“ Series D Preferred Stock ” means the series of Preferred Stock, par value $1.00 per share, having the powers, preferences and rights, and the qualifications, limitations and restrictions, as set forth in the Certificate of Amendment of the Corporation’s Certificate of Incorporation filed with the Department of the State of New York on the date this Certificate is first filed with the Department of the State of New York (the “ Series D Certificate of Amendment ”).

“ Stated Dividend Value ” on any Regular Dividend Calculation Date means $1,000 per share of Series C Preferred Stock plus, without duplication, any accrued and unpaid Regular Dividends accumulated prior to such Regular Dividend Calculation Date.

“ Stated Value ” means $1,000 per share of Series C Preferred Stock, as such amount may be (x) increased by the per share amount of any undeclared or (without duplication) unpaid Regular Dividend pursuant to Section (4)(c) and (y) decreased, effective as of the date of such payment, by the per share amount of any previously accumulated and unpaid Regular Dividend previously added to the Stated Value upon payment in cash or, as permitted in Section 6 or Section 9 , in shares of Series D Preferred Stock or Common Stock.

“ Stockholder Approval ” means all approvals, if any, of the stockholders of the Corporation required for the removal of the Conversion Cap in compliance with the Rule 312.03 of the NYSE Listed Company Manual or any successor rule.

“ Subsidiary ” means, with respect to any Person, another Person, an amount of the voting securities, other voting rights or voting partnership interests of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such voting interests, more than 50% of the equity interests of which) is owned directly or indirectly by such first Person.

“ Trading Day ” means a Business Day on which the Relevant Exchange is open for business and on which there has not occurred a Market Disruption Event.

“ Transaction Document ” has the meaning set forth in the North America Investment Agreement.

“ Transfer Agent ” means the Person acting as Transfer Agent, Registrar, paying agent and Conversion Agent for the Series C Preferred Stock, and such Person’s successors and assigns.  The Transfer Agent initially shall be Computershare Trust Company, N.A.

“ Trigger Event ” has the meaning set forth in Section 10(a)(vi) .

“ Voting Stock ” means the Common Stock, the Series C Preferred Stock and any other Capital Stock of the Corporation having the right to vote generally in any election of directors of the Board.

“ VWAP ” per share of Common Stock on any Trading Day means the per share volume-weighted average price as displayed under the heading Bloomberg VWAP on Bloomberg (or, if Bloomberg ceases to publish such price, any successor service reasonably chosen by the Corporation) page “AVP <equity> AQR” (or its equivalent successor if such page is not available) in respect of the period from the open of trading on the relevant Trading Day until the close of trading on such Trading Day (or if such volume-weighted average price is unavailable, the market price of one share of Common Stock on such Trading Day determined, using a volume-weighted average method, by an Independent Financial Advisor retained by the Corporation for such purpose).

SECTION 3.  Rank .  The Series C Preferred Stock shall, with respect to payment of dividends, rights upon liquidation, dissolution or winding up of the affairs of the Corporation, or otherwise, (i) rank senior and prior to the Common Stock and each other class or series of Junior Stock, (ii) rank on a parity with each other class or series of Parity Stock and (iii) rank junior to each class or series of Senior Stock, in each case whether such Junior Stock, Parity Stock or Senior Stock, as applicable, is outstanding as of the date of this Certificate or issued in the future.

SECTION 4.  Dividends.   (a)  Holders shall be entitled to participate equally and ratably with the holders of shares of Common Stock in all dividends and distributions paid in cash on the shares of Common Stock as if the shares of Series C Preferred Stock then outstanding were converted into shares of Common Stock immediately prior to each applicable Record Date (in the manner described in Section 6 below) (the “ Participating Dividends ”).  Participating Dividends shall be payable when, as and if declared by the Board, provided that Participating Dividends shall be payable on the same terms and on the same date as the applicable dividend is paid to the holders of Common Stock.

(b)  Regular Dividends shall be calculated on a quarterly basis on the last day of each fiscal quarter (each such day a “ Regular Dividend Calculation Date ”). “ Regular Dividend ” shall mean, for any fiscal quarter, the product of (i) the Dividend Rate and (ii) the Stated Dividend Value on such Regular Dividend Calculation Date, as adjusted in accordance with this Section 4(b). In any fiscal quarter, the Regular Dividend shall be reduced by any Participating Dividends paid in such quarter, provided that in no event shall the Regular Dividend for any quarter be less than zero.  During the period from the Issuance Date of any share of Series C Preferred Stock to the first Regular Dividend Calculation Date following the Issuance Date of such share, the Regular Dividend shall be calculated as an amount equal to the product of (i) the Stated Dividend Value multiplied by (ii) the product of (A) the Dividend Rate multiplied by (B) the lesser of one (1) and the quotient of (x) the number of days since the Issuance Date of such share divided by (y) 90. During the period from the last Regular Dividend Calculation Date prior to the seventh (7th) anniversary of the Issue Date to the seventh (7th) anniversary of the Issue Date, the Regular Dividend shall be calculated as an amount equal to the product of (i) the Stated Dividend Value multiplied by (ii) the product of (A) the Dividend Rate multiplied by (B) the lesser of one (1) and the quotient of (x) the number of days from such last Regular Dividend Calculation Date to the seventh (7th) anniversary of the Issue Date divided by (y) 90. During the period from the seventh (7th) anniversary of the Issue Date to the first Regular Dividend Calculation Date following the seventh (7th) anniversary of the Issue Date, the Regular Dividend shall be calculated as an amount equal to the product of (i) the Stated Dividend Value multiplied by (ii) the product of (A) the Dividend Rate multiplied by (B) the lesser of one (1) and the quotient of (x) the number of days since the seventh (7th) anniversary of the Issue Date divided by (y) 90.

(c)  Regular Dividends, whether or not declared, for each share of Series C Preferred Stock shall accrue from day to day and be cumulative beginning on the Issuance Date of such share of Series C Preferred Stock and ending on the date such share of Series C Preferred Stock ceases to be outstanding; provided , however , that, except to the extent not otherwise previously paid in accordance herewith, such Regular Dividends shall be payable on the seventh (7th) anniversary of the Issue Date and each subsequent Regular Dividend Calculation Date, when, as, and if declared by the Board. Any unpaid dividends accrued prior to and existing after the seventh (7th) anniversary of the Issue Date shall continue to accrue, and be compounded quarterly, at 5.0% per quarter until paid. For the avoidance of doubt, Regular Dividends shall accumulate whether or not in any quarterly period there have been funds of the Corporation legally available for the payment of such Regular Dividends. The Corporation may elect to pay any such accumulated dividends in cash at any time or from time to time in whole or in part, and, effective as of the date of such payment, the Stated Value shall decrease by the per share amount so paid.

(d)  Regular Dividends may, at the Corporation’s option, be paid in (i) cash, (ii) if the Common Stock Requirements are currently satisfied, in shares of Common Stock with an aggregate Dividend Payment Price equal to 103.0% of the amount of the Regular Dividend otherwise payable in cash or (iii) solely as permitted in Section 6 or Section 9 , in Series D Preferred Stock. For the avoidance of doubt, any issuance of Common Stock or Series D Preferred Stock in satisfaction of a dividend in accordance with this Certificate constitutes “payment” of the dividend for all purposes under this Certificate.

(e)  Except as otherwise provided herein, if at any time the Corporation pays less than the total amount of Regular Dividends then accumulated with respect to the Series C Preferred Stock, such payment shall be distributed pro rata among the Holders thereof based upon the Stated Value on all shares of Series C Preferred Stock held by each such Holder. When Regular Dividends are not paid in full upon the shares of Series C Preferred Stock, all Regular Dividends declared on Series C Preferred Stock and dividends on any other Parity Stock shall be paid pro rata so that the amount of Regular Dividends so declared on the shares of Series C Preferred Stock and dividends on each such other class or series of Parity Stock shall in all cases bear to each other the same ratio as accumulated dividends (for the full amount of dividends that would be payable for the most recently payable quarterly period if dividends were declared in full on all such Parity Stock) on the shares of Series C Preferred Stock and such other class or series of Parity Stock bear to each other.

(f)  Each Regular Dividend and Participating Dividend and any other dividend declared by the Board shall be payable to the Holders of record as they appear on the stock records of the Corporation at the close of business on such record dates as may be established by the Board, which shall be not more than 30 days nor less than 10 days preceding the applicable dividend payment date.

(g)  From and after the time, if any, that the Corporation shall have failed to pay all accumulated and unpaid Regular Dividends or Participating Dividends, no dividends shall be declared or paid or set apart for payment, or other distribution declared or made, upon any Junior Stock or Parity Stock, nor shall any Junior Stock or Parity Stock be redeemed, purchased or otherwise acquired for any consideration (nor shall any moneys be paid to or made available for a sinking fund for the redemption of any shares of any such Junior Stock or Parity Stock) by the Corporation, directly or indirectly, until all such Regular Dividends or Participating Dividends have been paid in full without the consent of a majority of the Holders; provided that the foregoing limitation shall not apply to:

(i) purchases, redemptions or other acquisitions of shares of Junior Stock or Parity Stock in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of any one or more employees, officers, directors, managers or consultants of or to the Corporation or any of its Subsidiaries;

(ii) an exchange, redemption, reclassification or conversion of (A) any class or series of Junior Stock for any class or series of Junior Stock or (B) any class or series of Parity Stock for any class or series of Parity Stock;

(iii) any dividend in the form of stock, warrants, options or other rights where the dividend stock or the stock issuable upon exercise of such warrants, options or other rights is the same stock as that on which the dividend is being paid or ranks equal or junior to that stock, including any dividend paid on shares of Series D Preferred Stock in additional shares of Series D Preferred Stock;

(iv) purchases of Junior Stock through the use of the proceeds of a substantially contemporaneous sale of other shares of Junior Stock; provided that such purchases of Junior Stock do not exceed the proceeds of such sale;

(v) purchases of fractional interests in shares of Parity Stock or Junior Stock pursuant to the conversion or exchange provisions of such Parity Stock or Junior Stock or the security being converted or exchanged;

(vi) distributions of Junior Stock or rights to purchase Junior Stock; or

(vii) any dividend in connection with the implementation of a shareholders’ rights or similar plan, or the redemption or repurchase of any rights under any such.

SECTION 5.  Liquidation Rights.   (a)  Liquidation.   In the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation, the Holders shall, with respect to each share of Series C Preferred Stock held by each such Holder, be entitled to receive the greater of (i) the Stated Value per share of Series C Preferred Stock, plus, without duplication, an amount equal to any dividends or distributions payable thereon pursuant to Section 4 hereof and remaining unpaid thereon and (ii) the payment such Holders would have received had such Holders, immediately prior to such liquidation, dissolution or winding up, converted such shares of Series C Preferred Stock into shares of Common Stock at the applicable Conversion Price set forth in Section 6 hereof (the greater of (i) and (ii), the “ Liquidation Preference Amount ”), in each case under clause (i) or (ii), out of assets legally available therefor before any payment or distribution of any assets of the Corporation shall be made or set apart for holders of any Junior Stock.  Holders shall not be entitled to any further payments in the event of any such voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation other than what is expressly provided for in this Section 5 .

(b)  Partial Payment.   If the assets of the Corporation are not sufficient to pay in full the aggregate liquidating distributions required to be paid pursuant to Section 5(a) to all Holders and all holders of any Parity Stock having pari passu rights as to dissolution, liquidation or winding up of the affairs of the Corporation, the amounts distributed to the Holders and to the holders of all such Parity Stock shall be paid pro rata in accordance with the respective aggregate liquidating distributions to which they would otherwise be entitled if all amounts payable thereon were paid in full.

 

(c)  Merger, Consolidation and Sale of Assets Not Liquidation.   For purposes of this Section 5 , the sale, conveyance, exchange or transfer (for cash, shares of stock, securities or other consideration) of all or substantially all or any part of the property and assets of the Corporation shall not be deemed a voluntary or involuntary liquidation, dissolution or winding

up of the affairs of the Corporation, nor shall the merger, consolidation, statutory exchange or any other business combination transaction of the Corporation into or with any other Person or the merger, consolidation, statutory exchange or any other business combination transaction of any other Person into or with the Corporation be deemed to be a voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation.

SECTION 6.  Right of the Holders to Convert.   (a)  Subject to the provisions of Section 7 , each Holder shall have the right, at any time and from time to time, at such Holder’s option, to convert any or all of such Holder’s shares of Series C Preferred Stock, in whole or in part, into fully paid and non-assessable shares of Common Stock at the Conversion Price.  Each share of Series C Preferred Stock shall be convertible into (i) the number of shares of Common Stock (calculated as to each conversion to the nearest 1/10,000th of a share) determined by dividing (A) the Stated Value immediately prior to such conversion (less any accrued and unpaid dividends satisfied contemporaneously with the conversion pursuant to clause (ii) below) by (B) the Conversion Price in effect at the close of business on the applicable Conversion Date, plus (ii) (x) cash in an amount equal to the amount of accrued and unpaid Regular Dividends for all completed dividend periods and (y) cash in an amount equal to Pro Rated Regular Dividends, plus (iii) cash in lieu of fractional shares in accordance with Section 10(j) ; provided that, in lieu of any cash payable pursuant to clause (ii) above, the Corporation may, at its option, (A) declare and pay a dividend to each Holder payable in a number of shares of Series D Preferred Stock such that the sum of the liquidation preference of such shares, in the aggregate, equals the cash payable pursuant to clause (ii) above, or (B) if the Common Stock Requirements are satisfied, declare and pay a dividend to each Holder payable in a number of shares of Common Stock with an aggregate Dividend Payment Price equal to 103.0% of the amount of cash payable pursuant to clause (ii) above, or (C) declare and pay a dividend to each Holder payable in any combination thereof.

(b)  The Corporation shall at all times reserve and keep available out of its authorized and unissued Common Stock, solely for issuance upon the conversion of the Series C Preferred Stock, such number of shares of Common Stock as shall from time to time be issuable upon the conversion of all the shares of Series C Preferred Stock then outstanding.  Any shares of Common Stock issued upon conversion of Series C Preferred Stock (i) shall be duly authorized, validly issued and fully paid and non-assessable, (ii) shall rank pari passu with the other shares of Common Stock outstanding from time to time and (iii) shall be approved for listing on the NYSE if shares of Common Stock generally are so listed (or any other National Securities Exchange on which the Common Stock is listed).

(c)  Notwithstanding anything herein to the contrary, prior to the receipt of any applicable Stockholder Approval, the Series C Preferred Stock shall not, under any circumstances, be convertible into more than 19.99% of the number of shares of Common Stock outstanding immediately prior to the Issue Date (subject to proportionate adjustment as described in Section 10 ) in connection with such conversion (such limitation, the “ Conversion Cap ”); provided that if the Series C Preferred Stock would at any time be convertible into a number of shares of Common Stock exceeding the Conversion Cap but for the preceding sentence, the Corporation shall, upon the written request of Holders holding a majority of the outstanding Series C Preferred Stock, hold a meeting of its stockholders within one hundred twenty (120) days following such request and use its commercially reasonable efforts to obtain the approval of its stockholders for the transactions described herein.

SECTION 7.  Conversion Procedures and Effect of Conversion.   (a)  Conversion Procedure.   A Holder must do each of the following in order to convert shares of Series C Preferred Stock pursuant to this Section 7(a) :

(i) complete and manually sign the conversion notice (the “ Conversion Notice ”) provided by the Conversion Agent, and deliver such notice to the Conversion Agent; provided that a Conversion Notice may be conditioned on the completion of a Change of Control or other corporate transaction as specified in reasonable detail in such Conversion Notice;

(ii) deliver to the Conversion Agent the certificate or certificates (if any) representing the shares of Series C Preferred Stock to be converted;

(iii) if required, furnish appropriate endorsements and transfer documents; and

(iv) if required, pay any stock transfer, documentary, stamp or similar taxes not payable by the Corporation pursuant to Section 21 .

The foregoing clauses  (ii) , (iii) and (iv) shall be conditions for the benefit of the Corporation to the issuance of shares of Common Stock to the Holders in the event of a Mandatory Conversion pursuant to Section 9 .

The “ Conversion Date ” means (A) the date on which a Holder complies with the procedures in this Section 7(a) (including the satisfaction, or waiver by the Holder, of all conditions to conversion set forth in the Conversion Notice (written notice of which satisfaction or waiver has been provided to the Conversion Agent)) or (B) the date or time specified by the Corporation for a Mandatory Conversion pursuant to Section 9 , in each case, with regard to shares of Series C Preferred Stock subject to such conversion.

(b)  Effect of Conversion.   Holders at the close of business on the record date for any payment of a Participating Dividend or Regular Dividend shall be entitled to receive the dividend payable on such shares on the corresponding dividend payment date notwithstanding the conversion thereof following such record date, if and when paid, and the converting holder need not include payment of the amount of such dividend upon surrender of shares of Series C Preferred Stock for conversion.  Effective immediately prior to the close of business on the Conversion Date applicable to any shares of Series C Preferred Stock, such shares of Series C Preferred Stock shall cease to be outstanding.

(c)  Record Holder of Underlying Securities as of Conversion Date.   The Person or Persons entitled to receive the Common Stock and, to the extent applicable, shares of Series D Preferred Stock, cash, securities or other property issuable upon conversion of Series C Preferred Stock on a Conversion Date shall be treated for all purposes as the record holder(s) of such shares of Common Stock and/or shares of Series D Preferred Stock, cash, securities or other property as of the close of business on such Conversion Date.  As promptly as practicable on or after the Conversion Date and compliance by the applicable Holder with the relevant conversion

procedures contained in Section 7(a) (and in any event no later than three (3) Trading Days thereafter), the Corporation shall issue the number of whole shares of Common Stock issuable upon conversion (and deliver payment of cash in lieu of fractional shares as set out in Section 10(j) ) and, to the extent applicable, any cash, securities or other property issuable thereon.  Such delivery of shares of Common Stock, securities or other property shall be made by book-entry.  In the event that a Holder shall not by written notice designate the name in which shares of Common Stock (and payments of cash in lieu of fractional shares) and, to the extent applicable, cash, securities or other property to be delivered upon conversion of shares of Series C Preferred Stock should be registered or paid, or the manner in which such shares, cash, securities or other property should be delivered, the Corporation shall be entitled to register and deliver such shares, securities or other property, and make such payment, in the name of the Holder and in the manner shown on the records of the Corporation.

(d)  No Adjustment.   No adjustment to shares of Series C Preferred Stock being converted on a Conversion Date or to the shares of Common Stock deliverable to the Holders upon such conversion shall be made in respect of dividends payable to holders of the Common Stock as of any date prior to the close of business on such Conversion Date.

(e)  Status of Converted or Reacquired Shares.   Shares of Series C Preferred Stock converted in accordance with this Certificate, or otherwise acquired by the Corporation in any manner whatsoever, shall be retired promptly after the conversion or acquisition thereof.  All such shares shall upon their retirement and any filing required by the NYBCL become authorized but unissued shares of Preferred Stock, without designation as to series until such shares are once more designated as part of a particular series by the Board pursuant to the provisions of the Certificate of Incorporation.

SECTION 8.  Change of Control Exchange.   (a)  Upon the occurrence of a Change of Control, each Holder of outstanding shares of Series C Preferred Stock shall have the option, during the period beginning on the effective date of the Change of Control (the “ Change of Control Effective Date ”) and ending on the date that is twenty (20) Business Days after the Final Change of Control Notice is sent to Holders, to either (i) require the Corporation (or its successor) to purchase, out of funds legally available therefor, any or all of its shares of Series C Preferred Stock at a purchase price per share of Series C Preferred Stock, payable in cash, equal to the applicable Stated Value or (ii) receive, for each share of Series C Preferred Stock, an amount of cash, securities or other property that such Holder would have received if such share of Series C Preferred Stock were converted to shares of Common Stock immediately prior to the consummation of such Change of Control (determined, in the event that holders of Common Stock were afforded an opportunity to elect a form of consideration, as if such Holder made no such election) (each, a “ Change of Control Exchange ”); provided that no payment of any kind shall be made to such Holder in connection with a Change of Control Exchange until all commitments under any then outstanding Permitted Secured Debt are terminated and all obligations with respect thereto are repaid in full in cash (and all letters of credit issued thereunder are cash collateralized or backstopped in a manner satisfactory to the issuer thereof).

(b)  Initial Change of Control Notice.   On or before the twentieth (20th) Business Day prior to the date on which the Corporation anticipates consummating a Change of Control (or, if later, promptly after the Corporation discovers that a Change of Control will or is

reasonably likely to occur or has occurred), a written notice shall be sent by or on behalf of the Corporation, by overnight courier, to the Holders as they appear in the records of the Corporation.  Such notice shall contain the date on which the Change of Control is anticipated to be effected (or, if applicable, the date on which a Change of Control has occurred).

(c)  Final Change of Control Notice.   On the Change of Control Effective Date (or if the Corporation discovers that a Change of Control has occurred, promptly following the date of such discovery), a final written notice (the “ Final Change of Control Notice ”) shall be sent by or on behalf of the Corporation, by overnight courier, to the Holders as they appear in the records of the Corporation.  Such notice shall contain:

(i) the date, which shall be twenty (20) Business Days after the Final Change of Control Notice is sent to Holders, by which the Holder must elect to effect a Change of Control Exchange;

(ii) the amount of cash, securities or other property that such Holder would receive if such Holder elects to exchange a share of Series C Preferred Stock for the amount of cash, securities or other property that such Holder would have received if such share of Series C Preferred Stock were converted to shares of Common Stock immediately prior to the consummation of such Change of Control pursuant to Section 8(a) ;

(iii) the purchase or exchange date for such shares, which shall be no greater than twenty (20) Business Days from the date by which the Holder must elect to effect a Change of Control Exchange; and

(iv) the instructions a Holder must follow to effect a Change of Control Exchange in connection with such Change of Control.

(d)  Change of Control Exchange Procedure.   To exercise a Change of Control Exchange, a Holder must, no later than 5:00 p.m., New York City time, on the date by which such election must be made, surrender to the Conversion Agent the certificates (if any) representing the shares of Series C Preferred Stock to be sold or exchanged and indicate in writing that it is electing to effect a Change of Control Exchange pursuant to Section 8(a)(i) or Section 8(a)(ii) , as applicable.

(e)  Delivery upon Change of Control Exchange.   Upon a Change of Control Exchange, the Corporation shall deliver or cause to be delivered to the Holder (i) by mail or wire transfer (at the Holder’s election) the purchase price payable upon the purchase by the Corporation of such Holder’s shares of Series C Preferred Stock (in the case of an exercise pursuant to Section 8(a)(i) ) or (ii) an amount of cash, securities or other property to be delivered to such Holder in exchange for its shares of Series C Preferred Stock (in the case of an exercise pursuant to Section 8(a)(ii) ).

(f)  Unexchanged Shares Remain Outstanding.   If a Holder does not elect to effect a Change of Control Exchange pursuant to this Section 8 with respect to all of its shares of Series C Preferred Stock, the shares of Series C Preferred Stock held by it and not surrendered for exchange will remain outstanding until otherwise subsequently converted, redeemed, reclassified or canceled.

(g)  Partial Exercise of Change of Control Exchange.   In the event that a Change of Control Exchange is effected with respect to shares of Series C Preferred Stock representing less than all the shares of Series C Preferred Stock held by a Holder, upon such Change of Control Exchange, the Corporation shall execute and the Transfer Agent shall, unless otherwise instructed in writing by the Corporation, countersign and deliver to such Holder, at the expense of the Corporation, a certificate evidencing the shares of Series C Preferred Stock held by the Holder as to which a Change of Control Exchange was not effected.

SECTION 9.  Mandatory Conversion.   (a)  The Corporation shall have the right, at its option, to cause all, but not less than all, of the outstanding shares of the Series C Preferred Stock to be converted into consideration equal to the consideration the Holder would have received upon a conversion effected pursuant to Section 6 if, (1) for the period of 30 consecutive Trading Days ending on the Trading Day preceding the date on which the Corporation sends a Notice of Mandatory Conversion, the VWAP of the Common Stock exceeds 200% of the then applicable Conversion Price of the Series C Preferred Stock; (2) on the Conversion Date for such Mandatory Conversion, a registration statement relating to the Common Stock issuable upon such Mandatory Conversion shall be effective with the SEC and the Common Stock shall be listed on the NYSE or any other National Securities Exchange; and (3) no Event of Noncompliance pursuant to Section 13(a)(iv) or (v) has occurred and is continuing (collectively, a “ Mandatory Conversion ”).

(b)  Notice of Mandatory Conversion.   In order to effect a Mandatory Conversion, the Corporation shall send, by overnight courier, to the Holders as they appear in the records of the Corporation a notice of such conversion (such notice, a “ Notice of Mandatory Conversion ”).  The Conversion Date for such Mandatory Conversion shall be a date selected by the Corporation and shall be no less than ten (10) Business Days and no greater than twenty (20) Business Days after the date on which the Corporation provides such Notice of Mandatory Conversion.  In addition to any information required by applicable law or regulation, the Notice of Mandatory Conversion shall state, as appropriate:

(i) the Conversion Date for the Mandatory Conversion; and

(ii) the Conversion Price as in effect on the date of the Notice of Mandatory Conversion and the number of shares of Common Stock and, if applicable, the number of shares of Series D Preferred Stock to be issued upon conversion of each share of Series C Preferred Stock.

SECTION 10.  Anti-Dilution Adjustments.   (a)  Adjustments.   The Conversion Price will be subject to adjustment, without duplication, under the following circumstances, except that the Corporation shall not make any adjustment to the Conversion Price in respect of any dividend or distribution covered by this Section 10(a) to the extent a Holder participates in such dividend or distribution equally and ratably on an as-converted basis for the shares of Series C Preferred Stock held by such Holder.

(i) the issuance of Common Stock as a dividend or distribution to all or substantially all holders of Common Stock, or a subdivision or combination of Common Stock or a reclassification of Common Stock into a greater or lesser number of shares of Common Stock, in which event the Conversion Price shall be adjusted based on the following formula:

CP1 = CP0 x (OS0 / OS1)

Any adjustment made pursuant to this clause (i) shall be effective immediately prior to the open of business on the Trading Day immediately following the Record Date, in the case of a dividend or distribution, or the effective date, in the case of a subdivision, combination or reclassification.

If any such event is declared but does not occur, the Conversion Price shall be readjusted, effective as of the date on which the Board announces that such event shall not occur, to the Conversion Price that would then be in effect if such event had not been declared.

(ii) the Corporation or one or more of its Subsidiaries purchases Common Stock pursuant to a tender offer or an exchange offer (other than an exchange offer that constitutes a Distribution Transaction subject to Section 10(a)(iv) ) by the Corporation or a Subsidiary of the Corporation for all or any portion of the Common Stock (a “ Qualifying Offer ”), if the cash and value of any other consideration included in the payment per share of Common Stock validly tendered or exchanged exceeds the Closing Price of the Common Stock on the Trading Day next succeeding the last day on which tenders or exchanges may be made pursuant to such tender or exchange offer (as it may be amended) (the “ Expiration Date ”), in which event the Conversion Price in effect immediately prior to the close of business on the fifth (5th) full Trading Day immediately following, and including, the Expiration Date shall be adjusted based on the following formula:

CP1 = CP0 x [(SP1 x OS0) / (FMV + (SP1 x OS1))]

Such adjustment shall occur on the fifth (5th) full Trading Day immediately following, and including, the Expiration Date, and notwithstanding anything to the contrary in Section 6 , the Holders shall not be entitled to convert any shares of Series C Preferred Stock prior to such fifth (5th) Trading Day.

(iii) the Corporation shall, by dividend or otherwise, distribute to all or substantially all holders of its Common Stock (other than cash in lieu of fractional shares), cash, shares of any class of Capital Stock, evidences of its indebtedness, assets, other property or securities, but excluding (A) dividends or distributions referred to in Section 10(a)(i) , (B) rights, options or warrants distributed in connection with a stockholder rights plan, (C) Distribution Transactions as to which Section 10(a)(iv) shall apply or (D) options or warrants referred to in Section 10(a)(v) (any of such shares of Capital Stock, indebtedness, assets or property that are not so excluded are hereinafter called the “ Distributed Property ”), then, in each such case, the Conversion Price shall be adjusted based on the following formula:

CP1 = CP0 x [(SP0 - FMV) / SP0]

If any such event is declared but does not occur, the Conversion Price shall be readjusted, effective as of the date on which the Board announces that such event shall not occur, to the Conversion Price that would then be in effect if such event had not been declared.

(iv) the Corporation effects a Distribution Transaction, in which case the Conversion Price in effect immediately prior to the close of business on the fifth (5th) full Trading Day immediately following, and including, the effective date of the Distribution Transaction shall be adjusted based on the following formula:

CP1 = CP0 x [MP0 / (FMV + MP0)]

Such adjustment shall occur on the fifth (5th) full Trading Day immediately following, and including, the effective date of the Distribution Transaction, and notwithstanding anything to the contrary in Section 6 , the Holders shall not be entitled to convert any shares of Series C Preferred Stock prior to such fifth (5th) Trading Day.

(v) The dividend, distribution or other issuance to all or substantially all holders of Common Stock of rights (other than rights, options or warrants distributed in connection with a stockholder rights plan (in which event the provisions of Section 10(a)(vi) shall apply) options or warrants entitling them to subscribe for or purchase shares of Common Stock for a period expiring sixty (60) days or less from the date of issuance thereof, at a price per share that is less than the Current Market Price as of the Record Date for such issuance, in which event the Conversion Price will be decreased based on the following formula:

     CP1 = CP0 x (OS0+Y) / [(OS0+X)]

     For purposes of this clause (v) , in determining whether any rights, options or warrants entitle the Holders to purchase the Common Stock at a price per share that is less than the Current Market Price as of the Record Date for such dividend, distribution or issuance, there shall be taken into account any consideration the Corporation receives for such rights, options or warrants, and any amount payable on exercise thereof, with the value of such consideration, if other than cash, to be the Fair Market Value thereof.

     Any adjustment made pursuant to this clause (v) shall become effective immediately following the close of business on the Record Date for such dividend, distribution or issuance. In the event that such rights, options or warrants are not so issued, the Conversion Price shall be readjusted, effective as of the date the Board publicly announces its decision not to issue such rights, options or warrants, to the Conversion Price that would then be in effect if such dividend, distribution or issuance had not been declared. To the extent that such rights, options or warrants are not exercised prior to their expiration or shares of Common Stock are otherwise not delivered pursuant to such rights, options or warrants upon the exercise of such rights, options or warrants, the Conversion Price shall be readjusted to the Conversion Price that would then be in effect had the adjustments made upon the dividend, distribution or issuance of such rights, options or warrants been made on the basis of the delivery of only the number of shares of Common Stock actually delivered.

(vi) If the Corporation has a stockholder rights plan in effect with respect to the Common Stock on any Conversion Date, upon conversion of any shares of the Series C Preferred Stock, Holders of such shares will receive, in addition to the applicable number of shares of

Common Stock, the rights under such rights plan relating to such Common Stock, unless, prior to such Conversion Date, the rights have (i) become exercisable or (ii) separated from the shares of Common Stock (the first of such events to occur, a “ Trigger Event ”), in which case, the Conversion Price will be adjusted, effective automatically at the time of such Trigger Event, as if the Corporation had made a distribution of such rights to all holders of Common Stock as described in Section 10(a)(iii) , subject to appropriate readjustment in the event of the expiration, termination or redemption of such rights prior to the exercise, deemed exercise or exchange thereof.   Notwithstanding the foregoing, to the extent any such stockholder rights are exchanged by the Corporation for shares of Common Stock or other property or securities, the Conversion Price shall be appropriately readjusted as if such stockholder rights had not been issued, but the Corporation had instead issued such shares of Common Stock or other property or securities as a dividend or distribution of shares of Common Stock pursuant to Section 10(a)(i) or Section 10(a)(iii) , as applicable.

To the extent that such rights are not exercised prior to their expiration, termination or redemption, the Conversion Price shall be readjusted to the Conversion Price that would then be in effect had the adjustments made upon the occurrence of the Trigger Event been made on the basis of the issuance of, and the receipt of the exercise price with respect to, only the number of shares of Common Stock actually issued pursuant to such rights.  Notwithstanding the foregoing, to the extent any such rights are exchanged by the Corporation for shares of Common Stock, the Conversion Price shall be appropriately readjusted as if such rights had not been issued, but the Corporation had instead issued the shares of Common Stock issued upon such exchange as a dividend or distribution of shares of Common Stock subject to Section 10(a)(i) .

Notwithstanding anything to the contrary in the preceding two paragraphs of this Section 10 , no adjustment shall be required to be made to the Conversion Price with respect to any Holder which is, or is an “affiliate” or “associate” of, an “acquiring person” under such stockholder rights plan or with respect to any direct or indirect transferee of such Holder who receives Series C Preferred Stock in such transfer after the time such Holder becomes, or its affiliate or associate becomes, such an “acquiring person”.

(b)  Calculation of Adjustments .  All adjustments to the Conversion Price shall be calculated by the Corporation to the nearest 1/10th of a cent and all conversions based thereon shall be calculated by the Corporation to the nearest 1/10,000th of one share of Common Stock (or if there is not a nearest 1/10,000th of a share, to the next lower 1/10,000th of a share).  No adjustment to the Conversion Price will be required unless such adjustment would require an increase or a decrease to the Conversion Price of at least $0.01; provided , however , that any such adjustment that is not required to be made will be carried forward and taken into account in any subsequent adjustment; provided further that any such adjustment of less than $0.01 that has not been made will be made upon any Conversion Date.

(c)  When No Adjustment Required .  (i) Except as otherwise provided in this Section 10 , the Conversion Price will not be adjusted for the issuance of Common Stock or any securities convertible into or exchangeable for Common Stock or carrying the right to purchase any of the foregoing, or for the repurchase of Common Stock.

(ii) Except as otherwise provided in this Section 10 , the Conversion Price will not be adjusted as a result of the issuance of, the distribution of separate certificates representing, the exercise or redemption of, or the termination or invalidation of, rights pursuant to any stockholder rights plans.

(iii) No adjustment to the Conversion Price will be made:

(A)  upon the issuance of any shares of Common Stock pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on securities of the Corporation (including any dividends of Common Stock in which Holders are entitled to participate pursuant to Section 4 ) and the investment of additional optional amounts in Common Stock under any plan in which purchases are made at market prices on the date or dates of purchase, without discount, and whether or not the Corporation bears the ordinary costs of administration and operation of the plan, including brokerage commissions;

(B)  upon the issuance of any shares of Common Stock or options or rights to purchase such shares pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by the Corporation or any of its Subsidiaries or of any employee agreements or arrangements or programs;

(C)  upon the issuance of any shares of Common Stock pursuant to any option, warrant, right or exercisable, exchangeable or convertible security; or

(D)  for a change in the par value of the Common Stock.

(d)  Successive Adjustments .  After an adjustment to the Conversion Price under this Section 10 , any subsequent event requiring an adjustment under this Section 10 shall cause an adjustment to such Conversion Price as so adjusted.

(e)  Multiple Adjustments .  For the avoidance of doubt, if an event occurs that would trigger an adjustment to the Conversion Price pursuant to this Section 10 under more than one subsection hereof, such event, to the extent fully taken into account in a single adjustment, shall not result in multiple adjustments hereunder; provided , however , that if more than one subsection of this Section 10 is applicable to a single event, the subsection shall be applied that produces the largest adjustment.

(f)  Tax Adjustments .  The Corporation may, but shall not be required to, make such reductions in the Conversion Price, in addition to those required by this Section 10 , as a majority of the Other Directors considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reason.

(g)  Optional Adjustments .  The Corporation may, but shall not be required to, from time to time, to the extent permitted by applicable law and in its sole discretion, reduce the Conversion Price by any amount for any period of at least twenty (20) Business Days if a majority of the Other Directors (taking into account, among other considerations, the impact of possible income or withholding taxes on the Holders) has determined that such reduction would be in the Corporation’s best interests.

(h)  Notice of Adjustments .  Whenever the Conversion Price is adjusted as provided under this Section 10 , the Corporation shall as soon as reasonably practicable following the occurrence of an event that requires such adjustment (or if the Corporation is not aware of such occurrence, as soon as reasonably practicable after becoming so aware) or the date the Corporation makes an adjustment pursuant to Section 10(f) or Section 10(g) :

(i) compute the adjusted applicable Conversion Price in accordance with this Section 10 and prepare and transmit to the Conversion Agent an Officer’s Certificate setting forth the applicable Conversion Price, the method of calculation thereof in reasonable detail, and the facts requiring such adjustment and upon which such adjustment is based; and

(ii) provide a written notice to the Holders of the occurrence of such event and a statement in reasonable detail setting forth the method by which the adjustment to the applicable Conversion Price was determined and setting forth the adjusted applicable Conversion Price.

(i)  Conversion Agent .  The Conversion Agent shall not at any time be under any duty or responsibility to any Holder to determine whether any facts exist that may require any adjustment of the applicable Conversion Price or with respect to the nature or extent or calculation of any such adjustment when made, or with respect to the method employed in making the same.  The Conversion Agent shall be fully authorized and protected in relying on any Officer’s Certificate delivered pursuant to Section 10(h) and any adjustment contained therein and the Conversion Agent shall not be deemed to have knowledge of any adjustment unless and until it has received such certificate.  The Conversion Agent shall not be accountable with respect to the validity or value (or the kind or amount) of any shares of Common Stock, or of any securities or property, that may at the time be issued or delivered with respect to any Series C Preferred Stock and the Conversion Agent makes no representation with respect thereto.  The Conversion Agent shall not be responsible for any failure of the Corporation to issue, transfer or deliver any shares of Common Stock pursuant to the conversion of Series C Preferred Stock or to comply with any of the duties, responsibilities or covenants of the Corporation contained in this Section 10 .

(j)  Fractional Shares .  No fractional shares of Common Stock will be delivered to the Holders upon conversion.  In lieu of fractional shares otherwise issuable, the Holders will be entitled to receive, at the Corporation’s sole discretion, either (i) an amount in cash equal to the fraction of a share of Common Stock multiplied by the Closing Price of the Common Stock on the Trading Day immediately preceding the applicable Conversion Date or (ii) one additional whole share of Common Stock.  In order to determine whether the number of shares of Common Stock to be delivered to a Holder upon the conversion of such Holder’s shares of Series C Preferred Stock will include a fractional share, such determination shall be based on the aggregate number of shares of Series C Preferred Stock of such Holder that are being converted on any single Conversion Date.

SECTION 11.  Adjustment for Reorganization Events.

(a)  Reorganization Events.   In the event of:

(i) any reclassification, statutory exchange, merger, consolidation or other similar business combination of the Corporation with or into another Person, in each case pursuant to which at least a majority of the Common Stock (but not the Series C Preferred Stock) is changed or converted into, or exchanged for, cash, securities or other property of the Corporation or another Person;

(ii) any sale, transfer, lease or conveyance to another Person of all or substantially all the property and assets of the Corporation, in each case pursuant to which the Common Stock (but not the Series C Preferred Stock) is converted into cash, securities or other property; or

(iii) any statutory exchange of securities of the Corporation with another Person (other than in connection with a merger or acquisition) or reclassification, recapitalization or reorganization of the Common Stock (but not the Series C Preferred Stock) into other securities;

(each of which is referred to as a “ Reorganization Event ”), each share of Series C Preferred Stock outstanding immediately prior to such Reorganization Event will, without the consent of the Holders and subject to Section 11(d) , remain outstanding, but shall become convertible into, out of funds legally available therefor, the number, kind and amount of securities, cash and other property (the “ Exchange Property ”) (without any interest on such Exchange Property and without any right to dividends or distributions on such Exchange Property which have a record date that is prior to the applicable Conversion Date) that the Holder of such share of Series C Preferred Stock would have received in such Reorganization Event had such Holder converted its shares of Series C Preferred Stock into the applicable number of shares of Common Stock immediately prior to the effective date of the Reorganization Event using the Conversion Price applicable immediately prior to the effective date of the Reorganization Event and the Stated Value applicable at the time of such conversion; provided that the foregoing shall not apply if such Holder is a Person with which the Corporation consolidated or into which the Corporation merged or which merged into the Corporation or to which such sale or transfer was made, as the case may be (any such Person, a “ Constituent Person ”), or an Affiliate of a Constituent Person, to the extent such Reorganization Event provides for different treatment of Common Stock held by such Persons; provided   further that to the extent that any portion of the Exchange Property consists of property (any such property, “ Disqualified Exchange Property ”) that does not constitute Qualified Equity Interests (as defined in the Revolving Credit Agreement), no payment of Disqualified Exchange Property shall be made to such Holder upon conversion of a share of Series C Preferred Stock following such Reorganization Event until all commitments under any then outstanding Permitted Secured Debt are terminated and all obligations with respect thereto are repaid in full in cash (and all letters of credit issued thereunder are cash collateralized or backstopped in a manner satisfactory to the issuer thereof).  If the kind or amount of securities, cash and other property receivable upon such Reorganization Event is not the same for each share of Common Stock held immediately prior to such Reorganization Event by a Person (other than a Constituent Person or an Affiliate thereof),

then for the purpose of this Section 11(a) , the kind and amount of securities, cash and other property receivable upon conversion following such Reorganization Event will be deemed to be the weighted average of the types and amounts of consideration received by the holders of Common Stock.

(b)  Successive Reorganization Events.   The above provisions of this Section 11 shall similarly apply to successive Reorganization Events and the provisions of Section 10 shall apply to any shares of Capital Stock (or capital stock of any other Person) received by the holders of the Common Stock in any such Reorganization Event.

(c)  Reorganization Event Notice.   The Corporation (or any successor) shall, no less than twenty (20) Business Days prior to the occurrence of any Reorganization Event, provide written notice to the Holders of such occurrence of such event and of the kind and amount of the cash, securities or other property that constitutes the Exchange Property.  Failure to deliver such notice shall not affect the operation of this Section 11 .

(d)  Reorganization Event Agreements.   The Corporation shall not enter into any agreement for a transaction constituting a Reorganization Event unless (i) such agreement provides for, or does not interfere with or prevent (as applicable), conversion of the Series C Preferred Stock into the Exchange Property in a manner that is consistent with and gives effect to this Section 11 and (ii) to the extent that the Corporation is not the surviving corporation in such Reorganization Event or will be dissolved in connection with such Reorganization Event, proper provision shall be made in the agreements governing such Reorganization Event for the conversion of the Series C Preferred Stock into stock of the Person surviving such Reorganization Event or such other continuing entity in such Reorganization Event or the applicable Exchange Property.

SECTION 12.  Voting Rights.

(a)  General .  Subject, with respect to the Investor Parties, to Section 2.07 of the Investor Rights Agreement, the Holders of shares of Series C Preferred Stock shall be entitled to vote with the holders of the Common Stock on all matters submitted to a vote of the holders of Common Stock (together with any other class or series of Capital Stock then entitled to vote with the Common Stock), except as prohibited by applicable law.  Each Holder shall be entitled to the number of votes equal to the largest number of whole shares of Common Stock into which all shares of Series C Preferred Stock held of record by such Holder could then be converted pursuant to Section 6 (taking into account, prior to the receipt of any applicable Stockholder Approval, the Conversion Cap) at the record date for the determination of stockholders entitled to vote or consent on such matters or, if no such record date is established, at the date on which such vote or consent is taken or any written consent of stockholders is first executed.  The Holders shall be entitled to notice of any meeting or action by written consent of holders of Common Stock as if they were holders of Common Stock.

(b)  Adverse Changes .  As long as any shares of Series C Preferred Stock are outstanding, unless a greater percentage shall be required by applicable law, the vote or consent of the Holders of at least a majority of the shares of Series C Preferred Stock outstanding at such time, voting together as a separate class, given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, will be necessary for:

(i)  effecting or validating any amendment, alteration, repeal or waiver of any provision of the Certificate of Incorporation (including this Certificate) that would adversely affect the relative rights, preferences or privileges or voting power of the Series C Preferred Stock, whether or not such approval is required pursuant to the NYBCL;

(ii) issuing any Senior Stock or Parity Stock other than the authorization and issuance of the Series D Preferred Stock in accordance with the Investor Rights Agreement and this Certificate;

(iii) delisting the Common Stock from the NYSE or any other National Securities Exchange upon which the Common Stock is then listed if after giving effect to such delisting the Common Stock would not be listed on a National Securities Exchange, other than transactions that result in a Change of Control; or

(iv) agreeing, whether in writing or otherwise, to do any of the foregoing if the Series C Preferred Stock would remain outstanding after giving effect to such transaction.

(c)  Election.   (i)  Directors.   From and after the Issue Date and until the Fall-Away of Investor Board Rights, the Majority Investor Parties shall have the exclusive right, voting separately as a class, to appoint and elect, either in writing without a meeting or by vote at any meeting called for the purpose, three (3) (or such lower number following the date on which the Investor Parties fail to satisfy the 75.0% Beneficial Ownership Requirement or the 50.0% Beneficial Ownership Requirement, as applicable, in each case as set forth in this Section 12(c) ) directors to the Board (each, a “ Preferred Director ”), subject to the additional terms and conditions set forth in Section 2.03 of the Investor Rights Agreement.

(ii)  Term.   Each Preferred Director shall serve until the next annual meeting of the stockholders of the Corporation and until his or her successor is elected and qualifies in accordance with this Section 12(c) and the Bylaws of the Corporation, unless such Preferred Director is earlier removed in accordance with clause  (iii) below, resigns (including at the request of a majority of the Other Directors in accordance with Section 2.05 of the Investor Rights Agreement) or is otherwise unable to serve.  In the event a Preferred Director is removed, resigns or is unable to serve as a member of the Board, subject to clause (iv) below and Section 2.03 of the Investor Rights Agreement, the Majority Investor Parties, voting separately as a class, shall have the right to fill such vacancy.  A Preferred Director may only be elected to the Board by the Majority Investor Parties in accordance with this Section 12(c) and subject to Section 2.03 of the Investor Rights Agreement.  In the event that the Majority Investor Parties have the right to appoint and elect a Preferred Director pursuant to Section 12(c)(i) but have not exercised such right, (A) a majority of the remaining Preferred Directors then serving on the Board shall have the right to appoint an additional Preferred Director to fill such vacancy or (B) such Preferred Director’s seat on the Board shall remain vacant until the earlier of the exercise or termination of such right.

(iii)  Removal.   S ubject to clause (iv) below and to Section 2.05 of the Investor Rights Agreement , any Preferred Director may be removed from office at any time, with

or without cause, by the Majority Investor Parties, either in writing without a meeting or by vote at any meeting called for the purpose.  For the avoidance of doubt, the Majority Investor Parties shall only have the right to remove a Preferred Director appointed or elected by the Majority Investor Parties or Preferred Directors and only during such time as the Majority Investor Parties shall have the right to fill the resulting vacancy in accordance with this Section 12(c) and the Investor Rights Agreement.

(iv)  Reduction of Preferred Directorships.

(A)  From and after the date the Investor Parties fail to satisfy the 75.0% Beneficial Ownership Requirement and until the date the Investor Parties fail to satisfy the 50.0% Beneficial Ownership Requirement, the Majority Investor Parties shall have the exclusive right to appoint and elect, voting separately as a class, either in writing without a meeting or by vote at any meeting called for the purpose, two (2) Preferred Directors to the Board, subject to the additional terms and conditions set forth in Section 2.03 of the Investor Rights Agreement.

(B)  From and after the date the Investor Parties fail to satisfy the 50.0% Beneficial Ownership Requirement and until the Fall-Away of Investor Board Rights, the Majority Investor Parties shall have the exclusive right to appoint and elect, voting separately as a class, either in writing without a meeting or by vote at any meeting called for the purpose, one (1) Preferred Director to the Board, subject to the additional terms and conditions set forth in Section 2.03 of the Investor Rights Agreement.

(C)  The right of the Majority Investor Parties, voting separately as a single class, to appoint and elect any Preferred Directors shall terminate upon the occurrence of the Fall-Away of Investor Board Rights.

(v)  Non-Limitation of Voting Rights.   For the avoidance of doubt but subject to Section 2.03 of the Investor Rights Agreement, the right of the Investor Parties to vote for the election of the Preferred Directors shall be in addition to the right of such Investor Parties as Holders to vote together with the holders of Common Stock (and any other class or series of Capital Stock entitled to vote thereon with the Common Stock) for the election of the other members of the Board.

(vi)  Board Rights Waiver.   At any time, the Majority Investor Parties may deliver a written notice to the Corporation irrevocably waiving the rights and privileges under this Section 12(c) (a “ Board Rights Waiver ”). Following the delivery of a Board Rights Waiver, the Fall-Away of Investor Board Rights shall be deemed to have occurred solely for the purposes of this Section 12(c) .

(d)  Voting.   Subject, with respect to the Investor Parties, to Section 2.07 of the Investor Rights Agreement, each Holder of Series C Preferred Stock will have one vote per share on any matter on which Holders of Series C Preferred Stock are entitled to vote separately as a class, whether at a meeting or by written consent.

SECTION 13.  Events of Noncompliance.

(a)  Definition.   An “ Event of Noncompliance ” shall have occurred if (i) the Corporation fails to pay in full on or prior to the seventh (7th) anniversary of the Issue Date all unpaid Regular Dividends which have or would have accrued through and including the seventh (7th) anniversary of the Issue Date; (ii) the Corporation fails to pay in full all unpaid Regular Dividends which have accrued after the seventh (7th) anniversary of the Issue Date on or prior to the applicable dividend payment date; (iii) the Corporation fails to declare and pay in full all Participating Dividends if, as and when required by Section 4 ; (iv) the Corporation fails to effect any conversion as required by Section 6 ; (v) the Corporation fails to effect any Change of Control Exchange as required by Section 8 ; or (vi) the Corporation breaches its obligations under Section 10 , Section 11 or Section 12 and such breach has not been cured within 30 days of its occurrence.  The foregoing shall constitute Events of Noncompliance whatever the reason or cause for any such Event of Noncompliance and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body and regardless of the effects of any subordination provisions. An Event of Noncompliance shall be deemed to no longer exist if, (a) in the case of an Event of Noncompliance described in clause (i) or (ii) above, all such Regular Dividends have been paid in full, (b) in the case of an Event of Noncompliance described in clause (iii) above, all such Participating Dividends have been paid in full, (c) in the case of an Event of Noncompliance described in clause (iv) above, such conversion has been effected, (d) in the case of an Event of Noncompliance described in clause (v) above, such Change of Control Exchange has been effected and (e) in the case of an Event of Noncompliance described in clause (vi) above, such breach has been cured.

(b)  Consequences of Events of Noncompliance .

(i) If an Event of Noncompliance has occurred (other than an Event of Noncompliance pursuant to Section 13(a)(i) ) and is continuing, the Dividend Rate for such outstanding Shares of Series C Preferred Stock will increase by 0.75%, effective as of the date of the Event of Noncompliance and continuing until there are no Events of Noncompliance.

(ii) If any Event of Noncompliance has occurred, each Holder shall also have any other rights which such Holder is entitled to under any contract or agreement in effect at any time and any other rights which such Holder may have pursuant to applicable law.

SECTION 14.  Preemptive Rights.   Except as expressly provided in the Investor Rights Agreement, the Holders shall not have any preemptive rights.

SECTION 15.  Corporate Opportunities.   Notwithstanding anything contained herein or in any other Transaction Document, so long as the 25.0% Beneficial Ownership Requirement is satisfied, the Investor Parties, any of their respective Affiliates and any of their respective directors, officers, employees and consultants, including any Preferred Directors (collectively, the “ Investor Related Parties ”), may freely offer to any other Person or effect on behalf of itself or any other Person any other investment or business opportunity or prospective economic advantage, including those competitive with the business of the Corporation, or other transactions in which the Corporation, its subsidiaries, any member of the Board or any other shareholder of the Corporation may have an interest or expectancy, including as a result of any fiduciary duties applicable to such Person (“ Investor Transactions ”),

in each case without any prior Corporation, Board or shareholder notification or approval; provided , that if the Corporation, to the Investor Party’s knowledge, is considering the same Investor Transaction, the Investor will promptly notify the Corporation of its interest in such Investor Transaction and cause each member of the Board that is an Investor Related Party to recuse himself from all Board discussions and activities relating to such Investor Transaction. Without limiting the generality of the foregoing, the Corporation agrees and acknowledges that Investor Parties and their respective Affiliates may have both passive and non-passive interests in Persons deemed competitors of the Corporation, and that the provisions of the immediately preceding sentence shall be applicable to such competitors, their respective Affiliates and any of their respective directors, officers and employees in respect thereof. Any person or entity purchasing, holding or otherwise acquiring any interest in any shares of the Corporation shall be deemed to have notice of and to have consented to the provisions of this Section 15 .  For the avoidance of doubt, this Section 15 shall survive the conversion of any or all of the shares of Series C Preferred Stock into shares of Common Stock so long as the 25.0% Beneficial Ownership Requirement is satisfied.

SECTION 16.  Term.   Except as expressly provided in this Certificate, the shares of Series C Preferred Stock shall not be redeemable or otherwise mature.

SECTION 17.  Creation of Capital Stock.   Subject, with respect to the Investor Parties, to Section 2.08 of the Investor Rights Agreement, the Board, or any duly authorized committee thereof, without the vote of the Holders, may authorize and issue additional shares of Capital Stock.

SECTION 18.  No Sinking Fund.   Shares of Series C Preferred Stock shall not be subject to or entitled to the operation of a retirement or sinking fund.

SECTION 19.  Transfer Agent, Conversion Agent, Registrar and Paying Agent.   The duly appointed Transfer Agent, Conversion Agent, Registrar and paying agent for the Series C Preferred Stock shall be Computershare Trust Company, N.A.  The Corporation may, in its sole discretion, appoint any other Person to serve as Transfer Agent, Conversion Agent, Registrar or paying agent for the Series C Preferred Stock and thereafter may remove or replace such other Person at any time.  Upon any such appointment or removal, the Corporation shall send notice thereof by first class mail, postage prepaid, to the Holders.

SECTION 20.  Replacement Certificates.   (a)  Mutilated, Destroyed, Stolen and Lost Certificates.   If physical certificates evidencing the Series C Preferred Stock are issued, the Corporation shall replace any mutilated certificate at the Holder’s expense upon surrender of that certificate to the Transfer Agent.  The Corporation shall replace certificates that become destroyed, stolen or lost at the Holder’s expense upon delivery to the Corporation and the Transfer Agent of satisfactory evidence that the certificate has been destroyed, stolen or lost, together with any indemnity that may be required by the Transfer Agent and the Corporation.

(b)  Certificates Following Conversion.   If physical certificates evidencing the Series C Preferred Stock are issued, the Corporation shall not be required to issue replacement certificates representing shares of Series C Preferred Stock on or after the Conversion Date applicable to such shares.  In place of the delivery of a replacement certificate following the applicable Conversion Date, the Transfer Agent, upon receipt of the satisfactory evidence and indemnity described in clause (a) above, shall deliver the shares of Common Stock issuable upon conversion of such shares of Series C Preferred Stock formerly evidenced by the physical certificate.

SECTION 21.  Taxes.   (a)  Transfer Taxes.   The Corporation shall pay any and all stock transfer, documentary, stamp and similar taxes that may be payable in respect of any issuance or delivery of shares of Series C Preferred Stock or shares of Common Stock or other securities issued on account of Series C Preferred Stock pursuant hereto, or certificates representing such shares or securities.  The Corporation shall not, however, be required to pay any such tax that may be payable in respect of any transfer involved in the issuance or delivery of shares of Series C Preferred Stock, shares of Common Stock or other securities in a name other than the name in which the shares of Series C Preferred Stock with respect to which such shares or other securities are issued or delivered were registered, or in respect of any payment to any Person other than a payment to the registered holder thereof, and shall not be required to make any such issuance, delivery or payment unless and until the Person otherwise entitled to such issuance, delivery or payment has paid to the Corporation the amount of any such tax or has established, to the satisfaction of the Corporation, that such tax has been paid or is not payable.

(b)  Withholding.   All payments and distributions (or deemed distributions) on the shares of Series C Preferred Stock (and on the shares of Common Stock received upon their conversion) shall be subject to withholding and backup withholding of taxes to the extent required by law, subject to applicable exemptions, and amounts withheld, if any, shall be treated as received by the Person in respect of which such withholding (or backup withholding) was made. The Corporation shall promptly notify a Holder if it determines that it has such requirement to withhold and give such Holder a reasonable opportunity to provide any form or certificate to reduce or eliminate such withholding. Within a reasonable amount of time after making such withholding payment, the Corporation shall furnish the Holder with copies of any tax certificate or other documentation evidencing such payment.

(c)  Indemnity. If the Corporation remits amounts to a taxing authority representing amounts required to be withheld under applicable law with respect to a Holder (as determined by the Corporation in its sole discretion), then such Holder shall indemnify the Corporation for the full amount remitted (including interest, penalties, additions and related expenses), to the extent such amounts were not previously offset against a cash payment otherwise payable to such Holder hereunder.

SECTION 22.  Notices.   All notices, requests, permissions, waivers or other communications required or permitted to be given under this Certificate shall be in writing and shall be delivered by hand or sent by facsimile or email or sent, postage prepaid, by registered, certified or express mail or overnight courier service and shall be deemed given when so delivered by hand or facsimile, or if mailed, three days after mailing (one Business Day in the case of express mail or overnight courier service) to the parties at the following addresses or facsimiles or emails (or at such other address or facsimile or email for a party as shall be specified by like notice): (i) if to the Corporation, to its office at Avon Products, Inc., 777 Third Avenue, New York, NY 10017-1307 (Attention: General Counsel) or (ii) if to any Holder, to such Holder at the address of such Holder as listed in the stock record books of the Corporation (which may include the records of the Transfer Agent).

SECTION 23.  Facts Ascertainable.   When the terms of this Certificate refer to a specific agreement or other document to determine the meaning or operation of a provision hereof, the Secretary of the Corporation shall maintain a copy of such agreement or document at the principal executive offices of the Corporation, and a copy thereof shall be provided free of charge to any Holder who makes a request therefor.  The Secretary of the Corporation shall also maintain a written record of the Issue Date, the number of shares of Series C Preferred Stock issued to a Holder and the date of each such issuance, and shall furnish such written record free of charge to any Holder who makes a request therefor.

SECTION 24.  Waiver.   Notwithstanding any provision in this Certificate to the contrary, (a) any provision contained herein and any right of the Holders granted hereunder may be waived as to all shares of Series C Preferred Stock (and the Holders thereof) upon the written consent of the Holders of a majority of the shares of Series C Preferred Stock then outstanding and (b) any right of the Investor Parties granted hereunder may be waived as to all Investor Parties upon the written consent of the Majority Investor Parties.

SECTION 25.  Interpretation.   When a reference is made in this Certificate to a Section, such reference shall be to a Section of this Certificate unless otherwise indicated.  The headings contained in this Certificate are for reference purposes only and shall not affect in any way the meaning or interpretation of this Certificate.  The word “will” shall be construed to have the same meaning as the word “shall”.  Whenever the words “include”, “includes” or “including” are used in this Certificate, they shall be deemed to be followed by the words “without limitation”.  The words “hereof”, “herein” and “hereunder” and words of similar import, when used in this Certificate, shall refer to this Certificate as a whole and not to any particular provision of this Certificate.  The word “or” shall not be exclusive.  The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and shall not simply mean “if”.  All references to “$” mean the lawful currency of the United States of America.  The definitions contained in this Certificate are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms, and references to the masculine, feminine or neuter gender shall include each other gender.  Except as specifically stated herein, any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein.  Except as otherwise specified herein, references to a Person are also to its permitted successors and assigns.  If any time period for giving notice or taking action hereunder expires on a day which is not a Business Day, the time period shall automatically be extended to the Business Day immediately following such non-Business Day.

SECTION 26.  Severability.   If any term of the Series C Preferred Stock set forth herein is invalid, illegal or incapable of being enforced because of any law or public policy, all other conditions and provisions set forth herein which can be given effect without the invalid, illegal or unenforceable term shall nevertheless remain in full force and effect, and no term herein set forth will be deemed dependent upon any other such term unless so expressed herein.

[Signature Page Follows]

IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed in its corporate name on this 25th day of February 2016.

	AVON PRODUCTS, INC.
	By:	/s/ James S. Scully
		Name:  James S. Scully
		Title:    Executive Vice President and Chief Financial Officer

---

CERTIFICATE OF AMENDMENT

OF

THE CERTIFICATE OF INCORPORATION

OF

AVON PRODUCTS, INC.

Under Section 805 of the Business Corporation Law of the State of New York

The undersigned, James S. Scully, Executive Vice President and Chief Financial Officer of Avon Products, Inc. (the “ Corporation ”), pursuant to the provisions of Sections 502 and 805 of the Business Corporation Law of the State of New York, does hereby certify as follows:

1.  The name of the Corporation is Avon Products, Inc. and the name under which the Corporation was formed is California Perfume Company, Inc.

2.  The Certificate of Incorporation forming the Corporation was filed by the Department of State of the State of New York on January 27, 1916.

3.  The Corporation is presently authorized to issue 25,000,000 shares of preferred stock having a par value of $1.00 per share (the “ Preferred Stock ”).  No series of Preferred Stock is presently outstanding.  As authorized by Section 502 of the Business Corporation Law of the State of New York (“ NYBCL ”) and Article III of the Corporation’s Restated Certificate of Incorporation, as amended (the “ Certificate of Incorporation ”), the Board of Directors of the Corporation has, before issuance, fixed the designation, preferences, privileges and voting power, and the restrictions and qualifications, of a new series of Preferred Stock to be known as Series D Preferred Stock.

4.  The Certificate of Incorporation is hereby amended by the addition of the provisions set forth below in this Certificate (this “ Certificate ”), setting forth the number, designation, preferences, privileges and voting power of the Series D Preferred Stock as fixed by the Board of Directors of the Corporation and the restrictions and qualifications thereof.

*     *     *     *     *

Pursuant to the authority expressly vested in the Board of Directors of the Corporation by the Certificate of Incorporation, the Board of Directors of the Corporation has duly authorized and approved, and created and provided for the issuance of, a series of Preferred Stock, in the amount and with the designation, preferences, privileges and voting powers and relative, participating, optional or other special rights, and any qualifications, limitations and restrictions thereof, as set forth below in this Certificate, which has been duly adopted by the Board of Directors of the Corporation.

SECTION 1.  Designation and Amount.   The shares of such series of Preferred Stock shall be designated as “Series D Preferred Stock” (the “ Series D Preferred Stock ”) and the number of authorized shares constituting the Series D Preferred Stock shall be 400,000.  Such

number of shares may be increased or decreased by resolution of the Board (as defined herein); provided that no decrease shall reduce the number of shares of Series D Preferred Stock to a number less than the number of shares of Series D Preferred Stock then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series D Preferred Stock or payment of dividends on any outstanding securities issued by the Corporation payable in Series D Preferred Stock.  Each share of Series D Preferred Stock shall rank equally in all respects and shall be subject to the following provisions of this Certificate.  The Corporation shall not have the authority to issue fractional shares of Series D Preferred Stock.

SECTION 2.  Definitions.   As used herein with respect to Series D Preferred Stock:

“ Affiliate ” means, with respect to any specified Person, any other Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such specified Person; provided that the Corporation and its Subsidiaries shall not be deemed to be Affiliates of the Investor or any of its Affiliates.  For the purposes of this definition, “ control ”, when used with respect to any specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “ controlling ” and “ controlled ” have meanings correlative to the foregoing.

 

Any Person shall be deemed to “ beneficially own ”, to have “ beneficial ownership ” of, or to be “ beneficially owning ” any securities (which securities shall also be deemed “ beneficially owned ” by such Person) that such Person is deemed to “beneficially own” within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act; provided that any Person shall be deemed to beneficially own any securities that such Person has the right to acquire, whether or not such right is exercisable immediately.

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

“ Business Day ”   means any weekday that is not a day on which banking institutions in New York, New York are authorized or required by law, regulation or executive order to be closed.

“ Capital Stock ” means any and all shares of, interests in, rights to purchase, warrants to purchase, options for, participations in or other equivalents of or interests in (however designated) stock issued by the Corporation.

“ Certificate ” has the meaning set forth in the recitals above.

“ Certificate of Incorporation ” has the meaning set forth in the recitals above.

“ Change of Control ” means the occurrence of one of the following:

(i) a “person” or “group” within the meaning of Section 13(d) of the Exchange Act obtains direct or indirect ultimate beneficial ownership of Voting Stock representing more than 50% of the voting power of the outstanding Voting Stock, other than any

(iii) any transaction or series of transactions by which the Corporation or any successor or Parent Entity thereof is organized outside the United States of America.

“ Change of Control Effective Date ” has the meaning set forth in Section 8(a) .

“ Change of Control Repurchase ” has the meaning set forth in Section 8(a) .

“ close of business ” means 5:00 p.m. (New York City time).

“ Closing Price ” of the Common Stock on any date of determination means the closing sale price or, if no closing sale price is reported, the last reported sale price, of shares of Common Stock on the NYSE on such date.  If the Common Stock is not traded on the NYSE on any date of determination, the Closing Price of the Common Stock on such date of determination means the closing sale price as reported in the composite transactions for the principal United States securities exchange or automated quotation system on which the Common Stock is so listed or quoted, or, if no closing sale price is reported, the last reported sale price on the principal United States securities exchange or automated quotation system on which the Common Stock is so listed or quoted, or if the Common Stock is not so listed or quoted on a United States securities exchange or automated quotation system, the last quoted bid price for the Common Stock in the over-the-counter market as reported by OTC Market Group, Inc. or any similar organization, or, if that bid price is not available, the market price of the Common Stock on that date as determined by an Independent Financial Advisor retained by the Corporation for such purpose.

“ Common Stock ” means the common stock, par value $0.25 per share, of the Corporation or its successor.

 

“ Common Stock Requirements ” means:

(i) the arithmetic average of the VWAP per share of Common Stock for each of the ten (10) consecutive full Trading Days immediately prior to the payment of any Regular Dividend in Common Stock, exceeds $3.00 per share;

(ii) the average daily trading volume for the last thirty (30) Trading Days exceeds three (3) times the number of shares of Common Stock issued as a dividend under this Certificate, the Series C Certificate of Amendment or any other certificate of amendment of the Corporation providing for the issuance of preferred stock (collectively, the “ Preferred Certificates ”) within the last ninety (90) calendar days (including the current dividend payment);

(iii) the number of shares of Common Stock held by non-Affiliates of the Corporation exceeds ten (10) times the number of shares issued as a dividend under the Preferred Certificates within the last ninety (90) calendar days (including the current dividend payment);

(iv) a registration statement relating to all such shares of Common Stock to be issued with respect to any dividend payment shall be effective with the SEC and such shares shall be listed on the NYSE or another National Securities Exchange;

(v) the Corporation shall have obtained the approval of its stockholders for the issuance of Common Stock as dividends, if required by the rules of the NYSE or other National Securities Exchange on which the Common Stock is then listed or applicable law;

(vi) as of the date of payment of any Regular Dividend in Common Stock, pro forma for such payment, no default or event of default exists under any agreement relating to material Debt of the Corporation or its Subsidiaries which is outstanding on the date of such Regular Dividend payment;

(vii) as of the date of payment of any Regular Dividend in Common Stock, pro forma for such payment, no Event of Noncompliance exists under the Preferred Certificates, other than an Event of Noncompliance which would be cured by such payment of a Regular Dividend or concurrent payment under the other Preferred Certificates;

(viii) shares of Common Stock being issued in such Regular Dividend payment shall not be subject to any transfer restrictions under any agreement between the Holder or its Affiliates, on the one hand, and the Corporation or its Subsidiaries, on the other hand; and

(ix) neither the Holder receiving the shares of Common Stock nor, if applicable, the Preferred Directors are, on the date of such payment, subject to restrictions in trading in securities of the Corporation pursuant to the Corporation’s policies relating to trading in the securities (including restrictions on the Preferred Directors due to their possession of material nonpublic information).

“ Corporation ” has the meaning set forth in the recitals above.

“ Debt ” has the meaning set forth in the Revolving Credit Agreement.

“ Dividend Payment Price ” means the arithmetic average of the VWAP per share of Common Stock for each of the five (5) consecutive full Trading Days ending on the Trading Day prior to the payment of a Regular Dividend in Common Stock.

“ Dividend Rate ” means 1.25%, as adjusted by Section 13(b) .

“ Event of Noncompliance ” has the meaning set forth in Section 13 .

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“ Final Change of Control Notice ” has the meaning set forth in Section 8(c) .

“ Holder ” means a Person in whose name shares of the Series D Preferred Stock are registered, which Person shall be treated by the Corporation, Transfer Agent, Registrar and paying agent as the absolute owner of the shares of Series D Preferred Stock for the purpose of making payment and settling conversions and for all other purposes; provided that, to the fullest extent permitted by law, no Person that has received shares of Series D Preferred Stock in violation of Article V of the Investor Rights Agreement shall be a Holder, and the Transfer Agent, Registrar and paying agent, as applicable, shall not, unless directed otherwise by the Corporation, recognize any such Person as a Holder.

“ Independent Financial Advisor ” means an accounting, appraisal, investment banking firm or consultant of nationally recognized standing; provided , however , that such firm or consultant is (i) not an Affiliate of the Corporation and (ii) so long as the Investor Parties beneficially own at least 5.0% of the outstanding shares of Series D Preferred Stock, is reasonably acceptable to the Investor Parties.

“ Investment Agreement ” means the investment agreement between the Corporation and the Investor dated as of December 17, 2015.

“ Investor ” means Cleveland Apple Investor L.P. (f/k/a/ Cleveland Apple Investor LLC).

“ Investor Party ” or “ Investor Parties ”, as applicable, means the Investor and each Affiliate of the Investor to whom shares of Series D Preferred Stock or Common Stock are transferred pursuant to and in accordance with Section 5.02 of the Investor Rights Agreement.

“ Investor Related Parties ” has the meaning set forth in Section 15 .

“ Investor Rights Agreement ” means the investor rights agreement between the Corporation and the Investor dated as of the Closing Date (as defined in the Investment Agreement), with respect to certain terms and conditions concerning, among other things, additional rights of and restrictions on the Holders.

“ Investor Transactions ” has the meaning set forth in Section 15 .

“ Issuance Date ” means, with respect to any share of Series D Preferred Stock, the date of issuance of such share.

“ Issue Date ” means the Closing Date (as defined in the Investment Agreement).

“ Junior Stock ” means the Common Stock and any other class or series of Capital Stock now existing or hereafter authorized other than (i) the Series C Preferred Stock and the Series D Preferred Stock, (ii) any class or series of Parity Stock and (iii) any class or series of Senior Stock.  “Junior Stock” shall include any rights, options or warrants exercisable or exchangeable for or convertible into Junior Stock.

“ Majority Investor Parties ” means, as of any date of determination, Investor Parties that beneficially own (excluding any duplicative beneficial ownership) shares of Series C Preferred Stock and/or shares of Common Stock that were issued upon conversion of shares of Series C Preferred Stock that represent, in the aggregate and on an as converted basis, more than 50.0% of the number of shares of Series C Preferred Stock and/or shares of Common Stock that were issued upon conversion of shares of Series C Preferred Stock, on an as converted basis, held by the Investor Parties as of the applicable date of determination.

“ Mandatory Redemption ” has the meaning set forth in Section 9(a) .

“ Market Disruption Event ” means any of the following events:

(a) any suspension of, or limitation imposed on, trading of the Common Stock by any exchange or quotation system on which the Closing Price is determined pursuant to the definition of the term “Closing Price” (the “ Relevant Exchange ”) during the one-hour period prior to the close of trading for the regular trading session on the Relevant Exchange (or for purposes of determining the VWAP per share of Common Stock, any period or periods aggregating one half-hour or longer during the regular trading session on the relevant day) and whether by reason of movements in price exceeding limits permitted by the Relevant Exchange as to securities generally, or otherwise relating to the Common Stock or options contracts relating to the Common Stock on the Relevant Exchange; or

(b) any event that disrupts or impairs (as determined by the Corporation in its reasonable discretion) the ability of market participants during the one-hour period prior to the close of trading for the regular trading session on the Relevant Exchange (or for purposes of determining the VWAP per share of Common Stock, any period or periods aggregating one half-hour or longer during the regular trading session on the relevant day) in general to effect transactions in, or to obtain market values for, the Common Stock on the Relevant Exchange or to effect transactions in, or to obtain market values for, options contracts relating to the Common Stock on the Relevant Exchange.

“ National Securities Exchange ” means the NYSE or the NASDAQ Stock Market.

“ North America Investment Agreement ” means the Separation and Investment Agreement, dated as of December 17, 2015, among the Corporation, C-A NA LLC, a wholly-owned subsidiary of the Corporation, and Cleveland NA Investors LLC.

“ NYBCL ” has the meaning set forth in the recitals above.

“ NYSE ” means the New York Stock Exchange and its successors.

“ Parent Entity ” means, with respect to any Person, any other Person of which such first Person is a direct or indirect wholly owned subsidiary.

“ Parity Stock ” means any class or series of Capital Stock hereafter authorized that expressly ranks on a parity basis with the Series D Preferred Stock as to dividend rights, rights of redemption and rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation.  “Parity Stock” shall include the Series C Preferred Stock and any rights, options or warrants exercisable or exchangeable for or convertible into Parity Stock.

“ Participating Dividends ” has the meaning set forth in Section 4(a) .

“ Permitted Secured Debt ” means indebtedness of the Corporation and its Subsidiaries in an aggregate principal amount not to exceed the amount of indebtedness permitted to be secured by the terms the Revolving Credit Agreement and designated as “Permitted Secured Debt” by the Corporation to the Holders (it being understood that indebtedness incurred under the Revolving Credit Agreement shall be deemed to be “Permitted Secured Debt”).

“ Person ” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, estate, unincorporated organization, governmental entity or other entity.

“ Preferred Certificates ” has the meaning set forth in the definition of the term “ Common Stock Requirements ”.

“ Preferred Stock ” has the meaning set forth in the recitals above.

“ Pro Rated Regular Dividends ” means, as of any date of determination, an amount of cash equal to the product of (i) the Stated Dividend Value multiplied by (ii) the product of (A) the Dividend Rate multiplied by (B) the lesser of one (1) and the quotient of (x) the number of days since, but not including, the last Regular Dividend Calculation Date to, and including, the date of determination, divided by (y) 90.

“ Redemption Date ” has the meaning set forth in Section 9(a) .

“ Redemption Price ” has the meaning set forth in Section 9(a) .

“ Registrar ” means the Transfer Agent acting in its capacity as registrar for the Series D Preferred Stock, and its successors and assigns.

“ Regular Dividend Calculation Date ” has the meaning set forth in Section 4(b) .

“ Regular Dividends ” has the meaning set forth in Section 4(b) .

“ Relevant Exchange ” has the meaning set forth in the definition of the term “Market Disruption Event”.

“ Revolving Credit Agreement ” means the revolving credit agreement, dated as of June 5, 2015, among, inter alios , the Corporation, Avon International Operations, Inc. and Citibank, N.A., as Administrative Agent, as in effect on December 17, 2015.

“ SEC ” means the U.S. Securities and Exchange Commission.

“ Senior Stock ” means any class or series of Capital Stock hereafter authorized that expressly ranks senior to the Series D Preferred Stock and has preference or priority over the Series D Preferred Stock as to dividend rights, rights of redemption or rights on the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation.  “Senior Stock” shall include any rights, options or warrants exercisable or exchangeable for or convertible into Senior Stock.

“ Series C Certificate of Amendment ” has the meaning set forth in the definition of the term “Series C Preferred Stock”.

“ Series C Preferred Stock ” means the series of Preferred Stock, par value $1.00 per share, having the powers, preferences and rights, and the qualifications, limitations and restrictions, as set forth in the Certificate of Amendment of the Corporation’s Certificate of Incorporation filed with the Department of the State of New York on the date this Certificate is first filed with the Department of the State of New York (the “ Series C Certificate of Amendment ”).

“ Series D Preferred Stock ” has the meaning set forth in Section 1 .

“ Subsidiary ” means, with respect to any Person, another Person, an amount of the voting securities, other voting rights or voting partnership interests of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such voting interests, more than 50% of the equity interests of which) is owned directly or indirectly by such first Person.

“ Stated Dividend Value ” on any Regular Dividend Calculation Date means $1,000 per share of Series D Preferred Stock plus, without duplication, any accrued and unpaid Regular Dividends accumulated prior to such Regular Dividend Calculation Date.

“ Stated Value ” means $1,000 per share of Series D Preferred Stock, as such amount may be (x) increased by the per share amount of any undeclared or (without duplication) unpaid Regular Dividend pursuant to Section (4)(c) and (y) decreased, effective as of the date of such payment, by the per share amount of any previously accumulated and unpaid Regular Dividend previously added to the Stated Value upon payment in cash or, as permitted in Section 9 , in shares of Common Stock.

“ Trading Day ” means a Business Day on which the Relevant Exchange is open for business and on which there has not occurred a Market Disruption Event.

“ Transaction Document ” has the meaning set forth in the North America Investment Agreement.

“ Transfer Agent ” means the Person acting as Transfer Agent, Registrar and paying agent for the Series D Preferred Stock, and such Person’s successors and assigns.  The Transfer Agent initially shall be Computershare Trust Company, N.A.

“ Voting Stock ” means the Common Stock, the Series C Preferred Stock and any other Capital Stock of the Corporation having the right to vote generally in any election of directors of the Board.

“ VWAP ” per share of Common Stock on any Trading Day means the per share volume-weighted average price as displayed under the heading Bloomberg VWAP on Bloomberg (or, if Bloomberg ceases to publish such price, any successor service reasonably chosen by the Corporation) page “AVP (equity) AQR” (or its equivalent successor if such page is not available) in respect of the period from the open of trading on the relevant Trading Day until the close of trading on such Trading Day (or if such volume-weighted average price is unavailable, the market price of one share of Common Stock on such Trading Day determined, using a volume-weighted average method, by an Independent Financial Advisor retained by the Corporation for such purpose).

SECTION 3.  Rank .  The Series D Preferred Stock shall, with respect to payment of dividends, rights upon liquidation, dissolution or winding up of the affairs of the Corporation, or otherwise, (i) rank senior and prior to the Common Stock and each other class or series of Junior Stock, (ii) rank on a parity with each other class or series of Parity Stock and (iii) rank junior to each class or series of Senior Stock, in each case whether such Junior Stock, Parity Stock or Senior Stock, as applicable, is outstanding as of the date of this Certificate or issued in the future.

SECTION 4.  Dividends.   (a)   Holders shall be entitled to participate equally and ratably with the holders of shares of Common Stock in all dividends and distributions paid in cash on the shares of Common Stock as if each share of Series D Preferred Stock were converted into one (1) share of Common Stock (the “ Participating Dividends ”).  Participating Dividends shall be payable when, as and if declared by the Board, provided that Participating Dividends shall be payable on the same terms and on the same date as the applicable dividend is paid to the holders of Common Stock.

(b)  Regular Dividends shall be calculated on a quarterly basis on the last day of each fiscal quarter (each such day a “ Regular Dividend Calculation Date ”). “ Regular Dividend ” shall mean, for any fiscal quarter, the product of (i) the Dividend Rate and (ii) the Stated Dividend Value on such Regular Dividend Calculation Date, as adjusted in accordance with this Section 4(b). In any fiscal quarter, the Regular Dividend shall be reduced by any Participating Dividends paid in such quarter, provided that in no event shall the Regular Dividend for any quarter be less than zero.  During the period from the Issuance Date of any share of Series D Preferred Stock to the first Regular Dividend Calculation Date following the Issuance Date of such share, the Regular Dividend shall be calculated as an amount equal to the product of (i) the Stated Dividend Value multiplied by (ii) the product of (A) the Dividend Rate multiplied by (B) the lesser of one (1) and the quotient of (x) the number of days since the Issuance Date of such share divided by (y) 90. During the period from the last Regular Dividend Calculation Date prior to the seventh (7th) anniversary of the Issue Date to the seventh (7th) anniversary of the Issue Date, the Regular Dividend shall be calculated as an amount

equal to the product of (i) the Stated Dividend Value multiplied by (ii) the product of (A) the Dividend Rate multiplied by (B) the lesser of one (1) and the quotient of (x) the number of days from such last Regular Dividend Calculation Date to the seventh (7th) anniversary of the Issue Date divided by (y) 90.

(c)  Regular Dividends, whether or not declared, for each share of Series D Preferred Stock shall accrue from day to day and be cumulative beginning on the Issuance Date of such share of Series D Preferred Stock and ending on the earlier of (x) the date such share of Series D Preferred Stock ceases to be outstanding and (y) the seventh (7th) anniversary of the Issue Date; provided , however , that, except to the extent not otherwise previously paid in accordance herewith, such Regular Dividends shall be payable on the seventh (7th) anniversary of the Issue Date, when, as, and if declared by the Board. Any accrued but unpaid dividends existing after the seventh (7th) anniversary of the Issue Date shall continue to accrue, and be compounded quarterly, at 5.0% per quarter until paid. For the avoidance of doubt, Regular Dividends shall accumulate whether or not in any quarterly period there have been funds of the Corporation legally available for the payment of such Regular Dividends. The Corporation may elect to pay any such accumulated dividends in cash at any time or from time to time in whole or in part, and, effective as of the date of such payment, the Stated Value shall decrease by the per share amount so paid.

(d)  Regular Dividends may, at the Corporation’s option, be paid in (i) cash or (ii) if the Common Stock Requirements are currently satisfied, in shares of Common Stock with an aggregate Dividend Payment Price equal to 103.0% of the amount of the Regular Dividend otherwise payable in cash. For the avoidance of doubt, any issuance of Common Stock in satisfaction of a dividend in accordance with this Certificate constitutes “payment” of the dividend for all purposes under this Certificate.

(e)  Except as otherwise provided herein, if at any time the Corporation pays less than the total amount of Regular Dividends then accumulated with respect to the Series D Preferred Stock, such payment shall be distributed pro rata among the Holders thereof based upon the Stated Value on all shares of Series D Preferred Stock held by each such Holder. When Regular Dividends are not paid in full upon the shares of Series D Preferred Stock, all Regular Dividends declared on Series D Preferred Stock and dividends on any other Parity Stock shall be paid pro rata so that the amount of Regular Dividends so declared on the shares of Series D Preferred Stock and dividends on each such other class or series of Parity Stock shall in all cases bear to each other the same ratio as accumulated dividends (for the full amount of dividends that would be payable for the most recently payable quarterly period if dividends were declared in full on all such Parity Stock) on the shares of Series D Preferred Stock and such other class or series of Parity Stock bear to each other.

(f)  Each Regular Dividend and Participating Dividend and any other dividend declared by the Board shall be payable to the Holders of record as they appear on the stock records of the Corporation at the close of business on such record dates as may be established by the Board, which shall be not more than 30 days nor less than 10 days preceding the applicable dividend payment date.

(g)  From and after the time, if any, that the Corporation shall have failed to pay all accumulated and unpaid Regular Dividends or Participating Dividends, no dividends shall be

declared or paid or set apart for payment, or other distribution declared or made, upon any Junior Stock or Parity Stock, nor shall any Junior Stock or Parity Stock be redeemed, purchased or otherwise acquired for any consideration (nor shall any moneys be paid to or made available for a sinking fund for the redemption of any shares of any such Junior Stock or Parity Stock) by the Corporation, directly or indirectly, until all such Regular Dividends or Participating Dividends have been paid in full without the consent of a majority of the Holders; provided that the foregoing limitation shall not apply to:

(i) purchases, redemptions or other acquisitions of shares of Junior Stock or Parity Stock in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of any one or more employees, officers, directors, managers or consultants of or to the Corporation or any of its Subsidiaries;

(ii) an exchange, redemption, reclassification or conversion of (A) any class or series of Junior Stock for any class or series of Junior Stock or (B) any class or series of Parity Stock for any class or series of Parity Stock;

(iii) any dividend in the form of stock, warrants, options or other rights where the dividend stock or the stock issuable upon exercise of such warrants, options or other rights is the same stock as that on which the dividend is being paid or ranks equal or junior to that stock, including any dividend paid on shares of Series D Preferred Stock in additional shares of Series D Preferred Stock;

(iv) purchases of Junior Stock through the use of the proceeds of a substantially contemporaneous sale of other shares of Junior Stock; provided that such purchases of Junior Stock do not exceed the proceeds of such sale;

(v) purchases of fractional interests in shares of Parity Stock or Junior Stock pursuant to the conversion or exchange provisions of such Parity Stock or Junior Stock or the security being converted or exchanged;

(vi) distributions of Junior Stock or rights to purchase Junior Stock; or

(vii) any dividend in connection with the implementation of a shareholders’ rights or similar plan, or the redemption or repurchase of any rights under any such.

SECTION 5.  Liquidation Rights.   (a)  Liquidation.   In the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation, the Holders shall, with respect to each share of Series D Preferred Stock held by each such Holder, be entitled to receive the Stated Value per share of Series D Preferred Stock out of assets legally available therefor before any payment or distribution of any assets of the Corporation shall be made or set apart for holders of any Junior Stock.  Holders shall not be entitled to any further payments in the event of any such voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation other than what is expressly provided for in this Section 5 .

(b)  Partial Payment.   If the assets of the Corporation are not sufficient to pay in full the aggregate liquidating distributions required to be paid pursuant to Section 5(a) to all Holders and all holders of any Parity Stock having pari passu rights as to dissolution, liquidation

or winding up of the affairs of the Corporation, the amounts distributed to the Holders and to the holders of all such Parity Stock shall be paid pro rata in accordance with the respective aggregate liquidating distributions to which they would otherwise be entitled if all amounts payable thereon were paid in full.

(c)  Merger, Consolidation and Sale of Assets Not Liquidation.   For purposes of this Section 5 , the sale, conveyance, exchange or transfer (for cash, shares of stock, securities or other consideration) of all or substantially all or any part of the property and assets of the Corporation shall not be deemed a voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation, nor shall the merger, consolidation, statutory exchange or any other business combination transaction of the Corporation into or with any other Person or the merger, consolidation, statutory exchange or any other business combination transaction of any other Person into or with the Corporation be deemed to be a voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation.

SECTION 6.  [Reserved]

SECTION 7.  [Reserved]

SECTION 8.  Change of Control Repurchase.   (a)  Upon the occurrence of a Change of Control, each Holder of outstanding shares of Series D Preferred Stock shall have the option, during the period beginning on the effective date of the Change of Control (the “ Change of Control Effective Date ”) and ending on the date that is twenty (20) Business Days after the Final Change of Control Notice is sent to Holders, to require the Corporation (or its successor) to purchase, out of funds legally available therefor, any or all of its shares of Series D Preferred Stock at a purchase price per share of Series D Preferred Stock, payable in cash, equal to the applicable Stated Value (a “ Change of Control Repurchase ”); provided that no payment of any kind shall be made to such Holder in connection with a Change of Control Repurchase until all commitments under any then outstanding Permitted Secured Debt are terminated and all obligations with respect thereto are repaid in full in cash (and all letters of credit issued thereunder are cash collateralized or backstopped in a manner satisfactory to the issuer thereof).

(b)  Initial Change of Control Notice.   On or before the twentieth (20th) Business Day prior to the date on which the Corporation anticipates consummating a Change of Control (or, if later, promptly after the Corporation discovers that a Change of Control will or is reasonably likely to occur or has occurred), a written notice shall be sent by or on behalf of the Corporation, by overnight courier, to the Holders as they appear in the records of the Corporation.  Such notice shall contain the date on which the Change of Control is anticipated to be effected (or, if applicable, the date on which a Change of Control has occurred).

(c)  Final Change of Control Notice.   On the Change of Control Effective Date (or if the Corporation discovers that a Change of Control has occurred, promptly following the date of such discovery), a final written notice (the “ Final Change of Control Notice ”) shall be sent by or on behalf of the Corporation, by overnight courier, to the Holders as they appear in the records of the Corporation.  Such notice shall contain:

(i) the date, which shall be twenty (20) Business Days after the Final Change of Control Notice is sent to Holders, by which the Holder must elect to effect a Change of Control Repurchase;

(ii) the purchase date for such shares, which shall be no greater than twenty (20) Business Days from the date by which the Holder must elect to effect a Change of Control Repurchase; and

(iii) the instructions a Holder must follow to effect a Change of Control Repurchase in connection with such Change of Control.

(d)  Change of Control Repurchase Procedure.   To exercise a Change of Control Repurchase, a Holder must, no later than 5:00 p.m., New York City time, on the date by which such election must be made, surrender to the Transfer Agent the certificates (if any) representing the shares of Series D Preferred Stock to be sold and indicate in writing that it is electing to effect a Change of Control Repurchase pursuant to Section 8 (a).

(e)  Delivery upon Change of Control Repurchase.   Upon a Change of Control Repurchase, the Corporation shall deliver or cause to be delivered to the Holder by mail or wire transfer (at the Holder’s election) the purchase price payable upon the purchase by the Corporation of such Holder’s shares of Series D Preferred Stock.

(f)  Unpurchased Shares Remain Outstanding.   If a Holder does not elect to effect a Change of Control Repurchase pursuant to this Section 8 with respect to all of its shares of Series D Preferred Stock, the shares of Series D Preferred Stock held by it and not surrendered for purchase will remain outstanding until otherwise subsequently converted, redeemed, reclassified or canceled.

(g)  Partial Exercise of Change of Control Repurchase.   In the event that a Change of Control Repurchase is effected with respect to shares of Series D Preferred Stock representing less than all the shares of Series D Preferred Stock held by a Holder, upon such Change of Control Repurchase, the Corporation shall execute and the Transfer Agent shall, unless otherwise instructed in writing by the Corporation, countersign and deliver to such Holder, at the expense of the Corporation, a certificate evidencing the shares of Series D Preferred Stock held by the Holder as to which a Change of Control Repurchase was not effected.

SECTION 9.  Mandatory Redemption.   (a)  At any time but not later than on the seventh (7th) anniversary of the Issue Date (any such date, a “ Redemption Date ”), the Corporation shall redeem all of the outstanding shares of the Series D Preferred Stock at a redemption price per share of Series D Preferred equal to the Stated Value (for purposes of this Section 9 , the “ Redemption Price ”) (collectively, a “ Mandatory Redemption ”).

(b)  The Redemption Price shall be payable, at the Corporation’s option, (i) in cash, (ii) if the Common Stock Requirements are met on the Redemption Date, in shares of Common Stock, or (iii) a combination thereof.  If any portion of the Redemption Price is paid in shares of Common Stock, the number of shares of Common Stock shall be equal to 103.0% of the quotient of (x) such portion of the Redemption Price divided by (y) the Dividend Payment Price.

SECTION 10.  [Reserved]

SECTION 11.  Merger. Unless consented to by holders of a majority of the outstanding shares of Series D Preferred Stock, the Corporation shall not consolidate with or merge into any other Person or convey, transfer or lease all or substantially all of its properties and assets to any Person, and the Corporation shall not permit any Person to consolidate with or merge into the Corporation, in a transaction in which the Corporation is not the surviving entity, unless the Person formed by such consolidation or into which the Corporation is merged or the Person which acquires by conveyance or transfer, or which leases, the properties and assets of the Corporation shall be a corporation, limited liability company, partnership or trust and shall either (a) issue to the Holders a kind and amount of securities having the same rights, preferences or privileges and voting power as the of shares of Series D Preferred Stock or (b) redeem all the outstanding shares of Series D Preferred Stock pursuant to Section 9 .

SECTION 12.  Adverse Changes.

(a)  As long as any shares of Series D Preferred Stock are outstanding, unless a greater percentage shall be required by applicable law, the vote or consent of the Holders of at least a majority of the shares of Series D Preferred Stock outstanding at such time, voting together as a separate class, given in person or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, will be necessary for effecting or validating any amendment, alteration, repeal or waiver of any provision of the Certificate of Incorporation (including this Certificate) that would adversely affect the relative rights, preferences or privileges or voting power of the Series D Preferred Stock, whether or not such approval is required pursuant to the NYBCL.

SECTION 13.  Events of Noncompliance.

(a)  Definition.   An “ Event of Noncompliance ” shall have occurred if (i) the Corporation fails to pay in full on or prior to the seventh (7th) anniversary of the Issue Date all unpaid Regular Dividends which have or would have accrued through and including the seventh (7th) anniversary of the Issue Date; (ii) the Corporation fails to declare and pay in full all Participating Dividends if, as and when required by Section 4 ; (iii)  the Corporation fails to effect any Change of Control Repurchase as required by Section 8 ; (iv) the Corporation breaches its obligations under Section 9 ; or (v) the Corporation breaches its obligations under Section 12 and such breach has not been cured within 30 days of its occurrence.  The foregoing shall constitute Events of Noncompliance whatever the reason or cause for any such Event of Noncompliance and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body and regardless of the effects of any subordination provisions. An Event of Noncompliance shall be deemed to no longer exist if, (a) in the case of an Event of Noncompliance described in clause (i) above, all such Regular Dividends have been paid in full, (b) in the case of an Event of Noncompliance described in clause (ii) above, all such Participating Dividends have been paid in full, (c) in the case of an Event of Noncompliance described in clause (iii) above, such repurchase has been effected, (d) in the case of an Event of Noncompliance described in clause (iv) or (v) above, such breach has been cured.

(b)  Consequences of Events of Noncompliance .

(i)  If an Event of Noncompliance has occurred (other than an Event of Noncompliance pursuant to Section 13(a)(i) or Section 13(a)(v) ) and is continuing, the Dividend Rate for such outstanding Shares of Series D Preferred Stock will increase by 0.75%, effective as of the date of the Event of Noncompliance and continuing until there are no Events of Noncompliance. If an Event of Noncompliance has occurred pursuant to Section 13(a)(v) ) and is continuing, the Dividend Rate for such outstanding Shares of Series D Preferred Stock will increase by 3.75%, effective as of the date of the Event of Noncompliance and continuing until there are no Events of Noncompliance.

(ii)  If any Event of Noncompliance has occurred, each Holder shall also have any other rights which such Holder is entitled to under any contract or agreement in effect at any time and any other rights which such Holder may have pursuant to applicable law.

SECTION 14.  Preemptive Rights.   Except as expressly provided in the Investor Rights Agreement, the Holders shall not have any preemptive rights.

SECTION 15.  Corporate Opportunities.   Notwithstanding anything contained herein or in any other Transaction Document, the Investor Parties, any of their respective Affiliates and any of their respective directors, officers, employees and consultants, including any Preferred Directors (collectively, the “ Investor Related Parties ”), may freely offer to any other Person or effect on behalf of itself or any other Person any other investment or business opportunity or prospective economic advantage, including those competitive with the business of the Corporation, or other transactions in which the Corporation, its subsidiaries, any member of the Board or any other shareholder of the Corporation may have an interest or expectancy, including as a result of any fiduciary duties applicable to such Person (“ Investor Transactions ”), in each case without any prior Corporation, Board or shareholder notification or approval; provided , that if the Corporation, to the Investor Party’s knowledge, is considering the same Investor Transaction, the Investor will promptly notify the Corporation of its interest in such Investor Transaction and cause each member of the Board that is an Investor Related Party to recuse himself from all Board discussions and activities relating to such Investor Transaction. Without limiting the generality of the foregoing, the Corporation agrees and acknowledges that Investor Parties and their respective Affiliates may have both passive and non-passive interests in Persons deemed competitors of the Corporation, and that the provisions of the immediately preceding sentence shall be applicable to such competitors, their respective Affiliates and any of their respective directors, officers and employees in respect thereof. Any person or entity purchasing, holding or otherwise acquiring any interest in any shares of the Corporation shall be deemed to have notice of and to have consented to the provisions of this Section 15.

SECTION 16.  Term.   Except as expressly provided in this Certificate, the shares of Series D Preferred Stock shall not be redeemable or otherwise mature.

SECTION 17.  Creation of Capital Stock.   Subject, with respect to the Investor Parties, to Section 2.08 of the Investor Rights Agreement, the Board, or any duly authorized committee thereof, without the vote of the Holders, may authorize and issue additional shares of Capital Stock.

SECTION 18.  No Sinking Fund.   Shares of Series D Preferred Stock shall not be subject to or entitled to the operation of a retirement or sinking fund.

SECTION 19.  Transfer Agent, Registrar and Paying Agent.   The duly appointed Transfer Agent, Registrar and paying agent for the Series D Preferred Stock shall be Computershare Trust Company, N.A.  The Corporation may, in its sole discretion, appoint any other Person to serve as Transfer Agent, Registrar or paying agent for the Series D Preferred Stock and thereafter may remove or replace such other Person at any time.  Upon any such appointment or removal, the Corporation shall send notice thereof by first class mail, postage prepaid, to the Holders.

SECTION 20.  Replacement Certificates.   (a)  Mutilated, Destroyed, Stolen and Lost Certificates.   If physical certificates evidencing the Series D Preferred Stock are issued, the Corporation shall replace any mutilated certificate at the Holder’s expense upon surrender of that certificate to the Transfer Agent.  The Corporation shall replace certificates that become destroyed, stolen or lost at the Holder’s expense upon delivery to the Corporation and the Transfer Agent of satisfactory evidence that the certificate has been destroyed, stolen or lost, together with any indemnity that may be required by the Transfer Agent and the Corporation.

SECTION 21.  Taxes.   (a)  Transfer Taxes.   The Corporation shall pay any and all stock transfer, documentary, stamp and similar taxes that may be payable in respect of any issuance or delivery of shares of Series D Preferred Stock or shares of Common Stock or other securities issued on account of Series D Preferred Stock pursuant hereto, or certificates representing such shares or securities.  The Corporation shall not, however, be required to pay any such tax that may be payable in respect of any transfer involved in the issuance or delivery of shares of Series D Preferred Stock, shares of Common Stock or other securities in a name other than the name in which the shares of Series D Preferred Stock with respect to which such shares or other securities are issued or delivered were registered, or in respect of any payment to any Person other than a payment to the registered holder thereof, and shall not be required to make any such issuance, delivery or payment unless and until the Person otherwise entitled to such issuance, delivery or payment has paid to the Corporation the amount of any such tax or has established, to the satisfaction of the Corporation, that such tax has been paid or is not payable.

(b)  Withholding.   All payments and distributions (or deemed distributions) on the shares of Series D Preferred Stock shall be subject to withholding and backup withholding of taxes to the extent required by law, subject to applicable exemptions, and amounts withheld, if any, shall be treated as received by the Person in respect of which such withholding (or backup withholding) was made. The Corporation shall promptly notify a Holder if it determines that it has such requirement to withhold and give such Holder a reasonable opportunity to provide any form or certificate to reduce or eliminate such withholding. Within a reasonable amount of time after making such withholding payment, the Corporation shall furnish the Holder with copies of any tax certificate or other documentation evidencing such payment.

(c)  Indemnity.   If the Corporation remits amounts to a taxing authority representing amounts required to be withheld under applicable law with respect to a Holder (as determined by the Corporation in its sole discretion), then such Holder shall indemnify the Corporation for the full amount remitted (including interest, penalties, additions and related expenses), to the extent such amounts were not previously offset against a cash payment otherwise payable to such Holder hereunder.

SECTION 22.  Notices.   All notices, requests, permissions, waivers or other communications required or permitted to be given under this Certificate shall be in writing and shall be delivered by hand or sent by facsimile or email or sent, postage prepaid, by registered, certified or express mail or overnight courier service and shall be deemed given when so delivered by hand or facsimile, or if mailed, three days after mailing (one Business Day in the case of express mail or overnight courier service) to the parties at the following addresses or facsimiles or emails (or at such other address or facsimile or email for a party as shall be specified by like notice): (i) if to the Corporation, to its office at Avon Products, Inc., 777 Third Avenue, New York, NY 10017-1307 (Attention: General Counsel) or (ii) if to any Holder, to such Holder at the address of such Holder as listed in the stock record books of the Corporation (which may include the records of the Transfer Agent).

SECTION 23.  Facts Ascertainable.   When the terms of this Certificate refer to a specific agreement or other document to determine the meaning or operation of a provision hereof, the Secretary of the Corporation shall maintain a copy of such agreement or document at the principal executive offices of the Corporation, and a copy thereof shall be provided free of charge to any Holder who makes a request therefor.  The Secretary of the Corporation shall also maintain a written record of the Issue Date, the number of shares of Series D Preferred Stock issued to a Holder and the date of each such issuance, and shall furnish such written record free of charge to any Holder who makes a request therefor.

SECTION 24.  Waiver.   Notwithstanding any provision in this Certificate to the contrary, (a) any provision contained herein and any right of the Holders granted hereunder may be waived as to all shares of Series D Preferred Stock (and the Holders thereof) upon the written consent of the Holders of a majority of the shares of Series D Preferred Stock then outstanding and (b) any right of the Investor Parties granted hereunder may be waived as to all Investor Parties upon the written consent of the Majority Investor Parties.

SECTION 25.  Interpretation.   When a reference is made in this Certificate to a Section, such reference shall be to a Section of this Certificate unless otherwise indicated.  The headings contained in this Certificate are for reference purposes only and shall not affect in any way the meaning or interpretation of this Certificate.  The word “will” shall be construed to have the same meaning as the word “shall”.  Whenever the words “include”, “includes” or “including” are used in this Certificate, they shall be deemed to be followed by the words “without limitation”.  The words “hereof”, “herein” and “hereunder” and words of similar import, when used in this Certificate, shall refer to this Certificate as a whole and not to any particular provision of this Certificate.  The word “or” shall not be exclusive.  The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and shall not simply mean “if”.  All references to “$” mean the lawful currency of the United States of America.  The definitions contained in this Certificate are applicable to the singular as well as

the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms, and references to the masculine, feminine or neuter gender shall include each other gender.  Except as specifically stated herein, any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein.  Except as otherwise specified herein, references to a Person are also to its permitted successors and assigns.  If any time period for giving notice or taking action hereunder expires on a day which is not a Business Day, the time period shall automatically be extended to the Business Day immediately following such non-Business Day.

SECTION 26.  Severability.   If any term of the Series D Preferred Stock set forth herein is invalid, illegal or incapable of being enforced because of any law or public policy, all other conditions and provisions set forth herein which can be given effect without the invalid, illegal or unenforceable term shall nevertheless remain in full force and effect, and no term herein set forth will be deemed dependent upon any other such term unless so expressed herein.

[Signature Page Follows]

IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed in its corporate name on this 25th day of February 2016.

 

	AVON PRODUCTS, INC.
	By:	/s/ James S. Scully
		Name:  James S. Scully
		Title:    Executive Vice President and Chief Financial Officer

 

---

October 6, 2016

(a)

Advance Notice .  Any shareholder entitled to vote in the election of directors intending to nominate one or more persons for election as directors at a meeting other than in accordance with Section 14(b) of this Article III may do so only if written notice of such shareholder’s intent to make such nomination is given to the secretary of the corporation not later than (i) with respect to an election to be held at an annual meeting of shareholders, 60 days in advance of such meeting, and (ii) with respect to an election to be held at a special meeting of shareholders for the election of directors, the close of business on the 7th day following the date on which notice of such meeting is first given to shareholders.  Each such notice shall set forth:  (a) the name and address of the shareholder who intends to make the nomination and of the person or persons to be nominated; (b) a representation that the shareholder is a holder of record of common stock of the corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice; (c) a description of all arrangements or understandings between the shareholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the shareholder; (d) such other information regarding each nominee proposed by such shareholder as would be

 

(b)

Proxy Access .

i.

Subject to the terms and conditions set forth in these by-laws, the corporation shall include in its proxy statement and on its form of proxy for an annual meeting of shareholders the name of, and the Additional Information (as defined below) relating to, any nominee for election or reelection to the board of directors who satisfies the eligibility requirements in this Section 14(b) (a “Shareholder Nominee”) and who is identified in a notice that complies with Section 14(b)(vi) of this Article III and that is timely delivered pursuant to Section 14(b)(vii) of this Article III (the “Shareholder Notice”) by a shareholder on behalf of one or more shareholders, but in no case more than twenty shareholders, who:

(A)

elect at the time of delivering the Shareholder Notice to have such Shareholder Nominee included in the corporation’s proxy materials,

(B)

as of the date of the Shareholder Notice, own (as defined below in Section 14(b)(iii) of this Article III) a number of shares that represents at least 3% of the outstanding shares of the corporation entitled to vote in the election of directors (the “Required Shares”) and has owned (as defined below in Section 14(b)(iii) of this Article III) continuously the Required Shares (as adjusted for any stock splits, stock dividends, or similar events) for at least 3 years, and

(C)

satisfy the additional requirements in these by-laws (such shareholder or shareholders collectively, an “Eligible Shareholder”).

ii.

For purposes of satisfying the ownership requirement under Section 14(b)(i) of this Article III:

(A)

the outstanding shares of the corporation owned by one or more shareholders may be aggregated, provided that the number of shareholders and other beneficial owners whose ownership of shares is aggregated for such purpose shall not exceed twenty, and

(B)

two or more funds that are (1) under common management and investment control, (2) under common management and funded primarily by a single employer or (3) a “group of investment companies,” as such term is defined in Section 14(d)(1)(G)(ii) of the

 

iii.

For purposes of this Section 14(b), an Eligible Shareholder “owns” only those outstanding shares of the corporation as to which the shareholder possesses both:

(A)

the full voting and investment rights pertaining to the shares, and

(B)

the full economic interest in (including the opportunity for profit and risk of loss on) such shares;

provided that the number of shares calculated in accordance with clauses (A) and (B) shall not include any shares:

(1)

sold by such shareholder or any control person in any transaction that has not been settled or closed (including any short sales),

(2)

borrowed by such shareholder or any control person for any purpose or purchased by such shareholder or any control person pursuant to an agreement to resell, or

(3)

subject to any option, warrant, forward contract, swap, contract of sale, other derivative or similar agreement entered into by such shareholder or any of its control persons, whether any such instrument or agreement is to be settled with shares or with cash based on the notional amount or value of outstanding shares of the corporation, in any such case which instrument or agreement has, or is intended to have, or if exercised by either party thereto would have, the purpose or effect of:  (I) reducing in any manner, to any extent or at any time in the future, such shareholder’s or any of its control persons’ full right to vote or direct the voting of any such shares, and/or  (II) hedging, offsetting, or altering to any degree gain or loss arising from the full economic ownership of such shares by such shareholder or control person.

A shareholder “owns” shares held in the name of a nominee or other intermediary so long as the shareholder retains the right to instruct how the shares are voted with respect to the election of directors and possesses the full economic interest in the shares. A shareholder’s ownership of shares

 

shall be deemed to continue during any period in which the shareholder has delegated any voting power by means of a proxy, power of attorney, or other instrument or arrangement that is revocable at any time by the shareholder. A shareholder’s ownership of shares shall be deemed to continue during any period in which the shareholder has loaned such shares provided that the shareholder has the power to recall such loaned shares on 5 business days’ notice. The terms “owned,” “owning” and other variations of the word “own” shall have correlative meanings. Whether outstanding shares of the corporation are “owned” for these purposes shall be determined by the board of directors.

 

iv.

No shareholder may be a member of more than one group of shareholders constituting an Eligible Shareholder under this Section 14(b). If a shareholder would otherwise qualify as a member of more than one group of shareholders constituting an Eligible Shareholder, it shall be deemed to be a member of the group with the largest shareholding as reflected in the Shareholder Notice.

v.

For purposes of this Section 14(b), the “Required Information” that the corporation will include in its proxy statement is:

(A)

the information concerning the Shareholder Nominee and the Eligible Shareholder that is required to be disclosed in the corporation’s proxy statement by the applicable requirements of the Exchange Act and the rules and regulations thereunder and as required by the principal U.S. exchange upon which the shares of the corporation are listed; and

(B)

if the Eligible Shareholder so elects, a written statement of the Eligible Shareholder, not to exceed 500 words, in support of its Shareholder Nominee, which must be provided at the same time as the Shareholder Notice for inclusion in the corporation’s proxy statement for the annual meeting (the “Statement”).

Notwithstanding anything to the contrary contained in this Section 14(b), the corporation may omit from its proxy materials any information or Statement that it in good faith believes would violate any applicable law or regulation. Nothing in this Section 14(b) shall limit the corporation’s ability to solicit against, and include in its proxy materials its own statements relating to, any Eligible Shareholder or Shareholder Nominee.

vi.

The inclusion of the Shareholder Nominee in the proxy materials shall be subject to the delivery to the corporation of, and the Shareholder Notice shall set forth, the following:

(A)

as to the Eligible Shareholder  (or in the case of a group, each shareholder whose shares are aggregated for purposes of constituting

 

(B)

as to each Shareholder Nominee whom the Eligible Shareholder proposes to nominate for election or reelection to the board of directors pursuant to this Section 14(b) of this Article III, (1) the Required Information (including the Shareholder Nominee’s written consent to being named in the corporation’s proxy statement as a nominee and to serving as a director if elected), and (2) a description of all direct and indirect compensation and other material monetary or voting agreements, arrangements, and understandings during the past 3 years, and any other material relationships, between or among the Eligible Shareholder and its affiliates and associates, or others acting in concert therewith, on the one hand, and each Shareholder Nominee, and each Shareholder Nominee’s respective affiliates and associates, or others acting in concert therewith, on the other hand, including, without limitation all information that would be required to be disclosed pursuant to Item 404 of Regulation S-K if the Eligible Shareholder, or any affiliate or associate thereof or person acting in concert therewith, were the “registrant” for purposes of Item 404 and the Shareholder Nominee were a director or executive officer of such registrant;

(C)

a copy of the Schedule 14N that has been or concurrently is filed with the SEC under Exchange Act Rule 14a-18; and

(D)

the written agreement of the Eligible Shareholder (or in the case of a group, each shareholder whose shares are aggregated for purposes of constituting an Eligible Shareholder) addressed to the corporation, setting forth the following additional agreements, representations, and warranties:

(1)

setting forth and certifying to the number of shares of the corporation it owns and has owned (as defined in Section 14(b)(iii) of this Article III) continuously for at least 3 years as of the date of the Shareholder Notice and agreeing to continue to own such shares through the date of the annual meeting, which statement shall also be included in the written statements set forth in Item 4 of the Schedule 14N filed by the Eligible Shareholder with the SEC;

 

 

(2)

the Eligible Shareholder’s agreement to provide written statements from the record holder and intermediaries as required under Section 14(b)(viii) of this Article III verifying the Eligible Shareholder’s continuous ownership of the Required Shares through and as of the business day immediately preceding the date of the annual meeting;

(3)

the Eligible Shareholder’s representation and agreement that the Eligible Shareholder (including each member of any group of shareholders that together is an Eligible Shareholder under this Section 14(b)):

I.

acquired the Required Shares in the ordinary course of business and not with the intent to change or influence control at the corporation, and does not presently have such intent,

II.

has not nominated and will not otherwise nominate for election to the board of directors at the annual meeting any person other than the Shareholder Nominee(s) being nominated pursuant to this Section 14(b),

III.

has not engaged and will not engage in a, and has not been and will not be a “participant” in another person’s, “solicitation” within the meaning of Exchange Act Rule 14a-1(l), in support of the election of any individual as a director at the annual meeting other than its Shareholder Nominee or a nominee of the board of directors, and

IV.

will not distribute to any shareholder any form of proxy for the annual meeting other than the form distributed by the corporation; and

(4)

the Eligible Shareholder’s agreement to:

I.

assume all liability stemming from any legal or regulatory violation arising out of the Eligible Shareholder’s communications with the shareholders of the corporation or out of the information that the Eligible Shareholder provided to the corporation,

II.

indemnify and hold harmless the corporation and each of its directors, officers and employees individually against any liability, loss or damages in connection with any threatened or pending action, suit or proceeding, whether legal, administrative or investigative, against the corporation or any of its directors, officers or employees arising out of any

 

III.

comply with all other laws and regulations applicable to any solicitation in connection with the annual meeting,

IV.

file all materials described below in Section 14(b)(viii)(C) of this Article III with the SEC, regardless of whether any such filing is required under Exchange Act Regulation 14A, or whether any exemption from filing is available for such materials under Exchange Act Regulation 14A,

V.

immediately notify the corporation if the Eligible Shareholder ceases to own any of the Required Shares prior to the date of the annual meeting,

VI.

intend to be present in person at the annual meeting to present its Shareholder Nominee at the meeting, and

VII.

provide to the corporation prior to the annual meeting such additional information as necessary or reasonably requested by the corporation; and

(5)

in the case of a nomination by a group of shareholders that together is an Eligible Shareholder, the designation by all group members of one group member that is authorized to act on behalf of all such members with respect to the nomination and matters related thereto, including any withdrawal of the nomination.

vii.

To be timely under this Section 14(b), the Shareholder Notice must be received by the secretary of the corporation not later than the close of business on the 120th day nor earlier than the close of business on the 150th day prior to the first anniversary of the date the definitive proxy statement was first released to shareholders in connection with the preceding year’s annual meeting of shareholders; provided, however that in the event the date of the current year annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice by the shareholder to be timely must be so delivered not earlier than the close of business on the 120th day and not later than the close of business on the later of the 90th day prior to the current year annual meeting or the 10th day following the day on which public announcement of the date of the current year annual meeting is first made by the corporation. In no event shall any adjournment or postponement of an annual meeting, or the announcement thereof, commence a new time period for the giving of the Shareholder Notice as described above.

 

 

viii.

An Eligible Shareholder (or in the case of a group, each shareholder whose shares are aggregated for purposes of constituting an Eligible Shareholder) must:

(A)

within 5 business days after the date of the Shareholder Notice, provide one or more written statements from the record holder(s) of the Required Shares and from each intermediary through which the Required Shares are or have been held, in each case during the requisite 3-year holding period, verifying that the Eligible Shareholder owns, and has owned continuously for the preceding 3 years, the Required Shares,

(B)

include in the written statements provided pursuant to Item 4 of Schedule 14N filed with the SEC a statement certifying that it owns and continuously has owned, as defined in Section 14(b)(iii) of this Article III, the Required Shares for at least 3 years,

(C)

file with the SEC any solicitation or other communication relating to the current year annual meeting, one or more of the corporation’s directors or director nominees or any Shareholder Nominee, regardless of whether any such filing is required under Exchange Act Regulation 14A or whether any exemption from filing is available for such solicitation or other communication under Exchange Act Regulation 14A, and

(D)

as to any group of funds whose shares are aggregated for purposes of constituting an Eligible Shareholder, within 5 business days after the date of the Shareholder Notice, provide documentation reasonably satisfactory to the corporation that demonstrates that the funds qualify as a Qualifying Fund.

ix.

Within the time period specified in Section 14(b)(vii) of this Article III for delivery of the Shareholder Notice, a Shareholder Nominee must deliver to the secretary of the corporation the questionnaire, representation and agreement set forth in Section 16 of this Article III.  At the request of the corporation, the Shareholder Nominee must promptly, but in any event within 5 business days of such request, submit any additional completed and signed questionnaires required of the corporation’s directors and provide to the corporation such other information as it may reasonably request. The corporation may request such additional information as necessary to permit the board of directors to determine if each Shareholder Nominee is independent under the listing standards of the principal U.S. exchange upon which the shares of the corporation are listed, any applicable rules of the SEC and any publicly disclosed standards used by the board of directors in determining and disclosing the independence of the corporation’s directors.

 

 

x.

Notwithstanding anything to the contrary contained in this Section 14(b), the corporation may omit from its proxy statement any Shareholder Nominee, and such nomination shall be disregarded and no vote on such Shareholder Nominee will occur, notwithstanding that proxies in respect of such vote may have been received by the corporation, if:

(A)

the secretary of the corporation receives notice that the Eligible  Shareholder nominating such Shareholder Nominee intends to nominate any person for election to the board of directors pursuant to the advance notice requirements for stockholder nominees for directors set forth in Section 14(a) of this Article,

(B)

the Eligible Shareholder materially breaches any of its agreements, representations, or warranties set forth in the Shareholder Notice, or if any of the information in the Shareholder Notice was not, when provided, true and correct or contains material omissions, or

(C)

the Shareholder Nominee (1) is not independent under the listing standards of the principal U.S. exchange upon which the shares of the corporation are listed, any applicable rules of the SEC, and any publicly disclosed standards used by the board of directors in determining and disclosing the independence of the corporation’s directors, (2) does not qualify as independent under the audit committee independence requirements set forth in the rules of the principal U.S. exchange on which shares of the corporation are listed, as a “non-employee director” under Exchange Act Rule 16b-3, or as an “outside director” for the purposes of Section 162(m) of the Internal Revenue Code (or any successor provision), (3) is or has been, within the past 3 years, an officer or director of a competitor (as defined in Section 8 of the Clayton Antitrust Act of 1914, as amended) of the corporation, or (4) is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses) or has been convicted in a criminal proceeding within the past 10 years.

xi.

The number of Shareholder Nominees appearing in the corporation’s proxy materials with respect to an annual meeting of shareholders shall not exceed the greater of (A) 2 or (B) 20% of the number of directors in office as of the last day on which a Shareholder Notice may be delivered pursuant to this Section 14(b) with respect to the annual meeting, or if such amount is not a whole number, the closest whole number below 20%.  The following persons shall be considered Shareholder Nominees for purposes of determining when the maximum number of Shareholder Nominees provided for in this Section 14(b) has been reached: (1) any Shareholder

 

xii.

Any Shareholder Nominee who is included in the corporation’s proxy materials for a particular annual meeting of shareholders but either (A) withdraws from or becomes ineligible or unavailable for election at the annual meeting, or (B) does not receive at least 20% of the votes cast in favor of the Shareholder Nominee’s election, will be ineligible to be a Shareholder Nominee pursuant to this Section 14(b) for the next 2 annual meetings.

 

The nominating and corporate governance committee in making its recommendation, and the board of directors in making its decision, may each consider any factors or other information that it considers appropriate and relevant. The director who tenders his or her resignation shall not participate in the recommendation of the

nominating and corporate governance committee or the decision of the board of directors with respect to his or her resignation. If such incumbent director’s resignation is not accepted by the board of directors, such director shall continue to serve until the end of his or her term and until his or her successor is duly elected, or his or her earlier resignation or removal. If a director’s resignation is accepted by the board of directors pursuant to this by-law, or if a nominee for director is not elected and the nominee is not an incumbent director, then the board of directors, in its sole discretion, may fill any resulting vacancy pursuant to the provisions of Section 2 of Article III of these by-laws or may decrease the size of the board of directors pursuant to the provisions of Section 1 of Article III of these by-laws and Section 702 of the Business Corporation Law of the State of New York.

 

Section 16. Submission of Questionnaire, Representation and Agreement .   To be eligible to be a nominee for election or reelection as a director of the corporation, a person must deliver (in accordance with the time periods prescribed for delivery of notice under Section 14 of this Article) to the secretary at the offices of the corporation provided for in Article I Section 1 of these by-laws a written questionnaire with respect to the background and qualification of such person and the background of any other person or entity on whose behalf the nomination is being made (which questionnaire shall be provided by the secretary upon written request) and a written representation and agreement (in the form provided by the secretary upon written request) that such person (a) will abide by the requirements of Section 15 of this Article, (b) is not and will not become a party to (1) any agreement, arrangement or understanding with, and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the corporation, will act or vote on any issue or question (a “Voting Commitment”) that has not been disclosed to the Corporation or (2) any Voting Commitment that could limit or interfere with such person’s ability to comply, if elected as a director of the corporation, with such person’s fiduciary duties under applicable law, and (c) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the corporation with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a director that has not been disclosed therein.

ARTICLE IV

COMMITTEES OF THE BOARD OF DIRECTORS

Section 1.  Committees .   The board of directors, by resolution or resolutions passed by a majority of the entire board of directors, may designate from among its members various committees, each consisting of 3 or more of the directors, and each of which, to the extent provided in said resolution or resolutions, shall have and may

exercise such powers and authority as may be specified by the board of directors, except that no such committee shall have authority as to (1) the submission to shareholders of any action that needs shareholders’ authorization under law, (2) the filling of vacancies in the board of directors or in any committee, (3) the fixing of compensation of the directors for serving on the board of directors or on any committee, (4) the amendment or repeal of the by-laws, or the adoption of new by-laws, or (5) the amendment or repeal of any resolution of the board of directors which by its terms shall not be so amendable or repealable.  The board of directors may designate one or more directors as alternate members of any such committee.  Each such committee and the members thereof shall serve at the pleasure of the board of directors.

 

Section 2.  Standing Committees .   There shall at all times be at least 3 standing committees of the board of directors, namely an audit committee, a compensation and management development committee and a nominating and corporate governance committee.  Each of the audit committee, compensation and management development committee and nominating and corporate governance committee shall consist of 3 or more directors, none of whom may be a current or former officer or employee of the corporation.  The compensation committee shall, in addition to such other duties as the board of directors may specify, administer the corporation’s stock incentive plans.

Section 3.  General Rules .   At each meeting of a committee, one-third of the entire committee, but not less than 2 members, shall constitute a quorum for the transaction of business.  Notice of the time and place of each committee meeting shall be subject to the same notice rules as are applicable to special meetings of the board of directors, except that no notice of the purpose of a committee meeting need be stated.  Any action required or permitted to be taken at any meeting of a committee of the board of directors may be taken without a meeting if all members of such committee consent to such action in writing and such writing or writings are filed with the minutes of proceedings of the committee.  Except as otherwise provided in this Article IV, each committee of the board of directors may adopt its own rules of procedure, may meet at stated times or on such notice as the committee may determine and shall keep regular minutes of its proceedings and report the same to the board of directors when required.

ARTICLE V

OFFICERS

Section 1.  Number and Designation .   The officers of the corporation will consist of a chief executive officer, one or more vice presidents, a treasurer, one or more secretaries, a controller and such other officers as the board of directors may elect,

including, but not limited to, one or more vice chairmen, a president, a chief financial officer, “executive” vice presidents, “senior” vice presidents or “group” vice presidents.  Any two offices may be held by one person, except that the chief executive officer may not also be the secretary, and except that, where these by-laws or resolutions of the board of directors provide for signatures of the incumbents of two offices of the corporation upon certificates for shares, notes, checks or other instruments or documents issued by the corporation, such offices must be held by two separate persons.

 

Section 2.  Election .   The board of directors shall, at their first meeting after their election, elect a chief executive officer, one or more vice presidents, one or more secretaries, a treasurer and a controller who need not be members of the board of directors, but in the event of the failure of the board of directors to elect any officer at such meeting, then such officers may be elected at any subsequent meeting of the board of directors.  Each officer so elected shall hold office until the first meeting of the board of directors following the next annual meeting of shareholders for the election of directors and until his or her successor is elected, except in the event of his or her death, resignation or removal or the earlier termination of his or her term of office, and except that the terms of office of all vice presidents shall terminate with each annual election of officers at which any vice president is elected.  Any vacancy in an office may be filled for the unexpired portion of the term of such office by the board of directors at any regular or special meeting.  The board of directors may also elect other officers, including a controller, who need not be members of the board of directors, and may prescribe, and from time to time change, their respective powers and duties, except as the powers and duties of the controller are prescribed by these by-laws.

Section 3.  The Chief Executive Officer .   The position of chief executive officer shall be held by such officer as the board of directors may from time to time designate.  The chief executive officer shall have the general powers and duties of supervision and management of the corporation, subject to the control of the board of directors, including the appointment of officers and employees of the corporation other than any successor chief executive officer, who shall be appointed and elected solely by the board of directors.  The chief executive officer shall also have the power, at any time, to discharge or remove any such appointed officer or employee of the corporation.

 

Section 5.  Vice Presidents .   Each vice president, including any executive vice presidents, senior vice presidents and/or group vice presidents, shall have such powers and shall perform such duties as may be assigned to him or her by the board of directors or the chief executive officer.

 

Section 6.  The Treasurer .   The treasurer shall have oversight of the care and custody of all the funds and securities of the corporation and shall deposit the same in the

 

name of the corporation or other applicable entity in such bank or banks, trust company or trust companies, deposit company or companies or other entities as may be designated from time to time, as appropriate.  The treasurer shall perform the duties and exercise all the powers usually incidental to the office of the treasurer and such other duties as from time to time may be assigned to him or her by the board of directors or the chief executive officer.

 

Section 7.  Secretaries .   A secretary or a secretary’s designee shall keep the minutes and act as secretary of all meetings of the board of directors and of the shareholders.  A secretary shall attend to the giving and serving of all notices of the corporation.  A secretary shall be the custodian of the records of the board of directors and committees thereof and of the corporate seal of the corporation.  A secretary shall attend to such correspondence as may be assigned to him or her and perform all the duties incidental to his or her office.  Any secretary shall be empowered to affix the corporate seal to all documents, execution of which, on behalf of the corporation, under its seal, is duly authorized and when so affixed may attest the same; and, in general, he or she shall perform the duties and exercise all the powers usually incidental to the office of a secretary of a corporation, and such other duties as, from time to time, may be assigned to him or her by the board of directors or the chief executive officer.

Section 8.  The Controller .   The controller shall maintain and supervise proper books and records of all assets, liabilities, disbursements and transactions of the corporation.  The controller shall prepare such financial statements and reports as shall be required, and shall perform such other duties as from time to time may be assigned to him or her by the board of directors or the chief executive officer.

Section 9.  Shareholder Consents and Proxies .   The chief executive officer, treasurer and secretary of the corporation or any one of them or their designees, shall have the power and authority on behalf of the corporation to execute any consents or proxies, authorizing any person to attend and act and vote in person or by proxy at any meetings of the shareholders or members of any corporation or other entity in which the corporation owns stock or otherwise has an ownership interest, or to attend such meetings themselves, and at any such meetings they or their designees or proxies, as the case may be, shall possess and may exercise any and all rights and powers incidental to such ownership as the corporation as the owner thereof might have possessed and executed if present.

Section 10.  Delegation of Duties of Officer .   The board of directors may delegate the duties and powers of any officer, agent or employee of the corporation to any other officer, agent or employee or director for a specified time during the absence of any such person or for any other reason that the board of directors may deem sufficient.

 

 

Section 11.  Removal .   Any officer of the corporation elected or appointed by the board of directors may be removed by the board of directors with or without cause.  Any officer appointed by the chief executive officer in accordance with these by-laws may be removed by the chief executive officer with or without cause.

ARTICLE VI

CAPITAL SHARES

Section 1.  Form .   The capital shares of the corporation may be represented by certificates, may be uncertificated shares or may be in such other form as shall be prescribed by law or approved by the board of directors.

Section 2.  Certificates for Shares .   To the extent the capital shares of the corporation are represented by certificates, the certificates shall be in such forms as may be prescribed by law and as shall be approved by the board of directors.   All share certificates shall be signed by the chairman or a vice-chairman of the board or the president or a vice-president and the secretary or an assistant secretary or the treasurer or an assistant treasurer and shall have the seal of the corporation affixed thereto.  Such seal may be a facsimile, engraved or printed.  Where any such certificate is countersigned by a transfer agent or registered by a registrar, other than the corporation itself or its employee, the signatures of any such officers or assistant officers upon such certificate may be facsimiles, engraved or printed.

Section 3.   Lost, Destroyed or Mutilated Share Certificates .  The holder of any certificated share of the corporation shall immediately notify the corporation of any loss, destruction or mutilation of such certificate, and the corporation may issue a new share certificate in place of any certificate theretofore issued by it which the owner thereof shall allege to have been lost, destroyed or mutilated.  The corporation may, in its discretion, require such owner or the owner’s legal representative to give to the corporation a bond in such sum and in such form and with such surety or sureties as the board in its sole discretion shall determine, to indemnify the corporation against any claim that may be made against it on account of the alleged loss or destruction of any such certificate, or the issuance of such new certificate.  Anything to the contrary in these by-laws notwithstanding, but subject to anything to the contrary in the certificate of incorporation, the corporation, in its absolute discretion, may refuse to issue any such new certificate, except pursuant to legal proceedings under the laws of the State of New York.

 

 

Section 4.  Transfer .   The board of directors shall have the power and authority to make such rules and regulations as it may deem expedient concerning the issue, registration and transfer of share certificates, and may appoint transfer agents or clerks and registrars thereof.  Transfers of shares of stock of the corporation shall be made on the record of shareholders of the corporation only upon authorization by the registered holder thereof, or by an attorney thereunto authorized by power of attorney duly executed and filed with the secretary or with a transfer agent or transfer clerk, and on surrender of the share certificate or share certificates properly endorsed, provided such shares are represented by a certificate, or accompanied by a duly executed stock transfer power and the payment of all taxes thereon. The person in whose names shares of stock shall stand on the record of shareholders of the corporation shall be deemed the owner thereof for all purposes as regards the corporation. Whenever any transfers of shares shall be made for collateral security and not absolutely and written notice thereof shall be given to the secretary or to such transfer agent or transfer clerk, such fact shall be stated in the entry of the transfer.

Section 5.  Fixing of Record Date .   The board of directors may at any time fix a record date not more than 50 nor less than 10 days prior to (a) the date of any meeting of shareholders or (b) the last day on which the shareholders are entitled to express consent or dissent from any proposal without a meeting, as the date as of which shareholders entitled to notice of or to vote at such a meeting, or whose consent or dissent is required or may be expressed, for any purpose, as the case may be, shall be determined, and, except as otherwise provided by law, all persons who were the holders of record of voting shares at such date and no others shall be entitled to notice of and to vote at such meeting or to express their consent or dissent, as the case may be.  The board of directors may at any time fix a record date not exceeding fifty days prior to the date fixed for the payment of any dividend or the making of any distribution or for the delivery or allotment of evidences of rights or evidences of interest arising out of any change, conversion, or exchange of capital shares, as the date for the determination of the shareholders entitled to receive any such dividend, distribution, rights or interest, and in any such case only shareholders of record at the date so fixed shall be entitled to receive such dividend, distribution, rights or interest.

ARTICLE VII

 

NEGOTIABLE INSTRUMENTS, CONTRACTS, ETC .

Section 1.  Signatures on Checks, etc .   All checks, drafts, bills of exchange, notes or other obligations or orders for the payment of money shall be signed in the name of the corporation by such officer or officers, person or persons, as the board of directors may from time to time designate by resolution.

 

 

Section 2.  Execution of Contracts, Deeds, etc .   The board of directors or any committee given specific authority in the premises, or given authority to exercise generally the powers of the board of directors during the interval between meetings of the board of directors to the extent permitted by law, may authorize any officer or officers, agent or agents, in the name of and on behalf of the corporation, to enter into or execute and deliver any and all deeds, bonds, mortgages, contracts and other obligations or instruments and to vote on behalf of the corporation shares of stock of other domestic or foreign corporations standing in the name of the corporation, and such authority may be general or confined to specific instances.

ARTICLE VIII

CORPORATE SEAL

Section 1.  Description .   The seal of the corporation shall be circular in form with the name of the corporation in the circumference and the words and figures “Corporate Seal--1916--N.Y.” in the center.

ARTICLE IX

 

FISCAL YEAR

Section 1.  Definition .   The fiscal year of this corporation shall be from the first day of January to the thirty-first day of December, inclusive, in each year or such other twelve consecutive months as the board of directors may by resolution designate.

ARTICLE X

WAIVER OF NOTICE

Section 1.  Meetings Held on Waiver .   Whenever any notice is required to be given under the provisions of these by-laws, or of the certificate of incorporation, or of any of the laws of the State of New York, a waiver thereof, in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent thereto.  The attendance of any shareholder at a meeting, in person or by proxy, without protesting prior to the conclusion of the meeting the lack of notice of such meeting, shall constitute a waiver of notice by him or her.

 

 

ARTICLE XI

AMENDMENTS

Section 1.  By the Shareholders .   Except as otherwise provided by law, these by-laws may be amended or repealed or new by-laws may be adopted at any meeting of the shareholders of the corporation by the affirmative vote of shareholders holding of record a majority of the issued and outstanding shares entitled to vote, represented either in person or by proxy, provided notice of the proposed amendment be contained in the notice or waiver of notice of such meeting.

Section 2.  By the Board of Directors .   Except as otherwise provided by law, these by-laws may be amended at any meeting of the board of directors of the corporation at which a quorum is present by the affirmative vote of a majority of the directors present at such meeting, provided notice of the proposed amendment is contained in the notice or waiver of notice of such meeting.

ARTICLE XII

INDEMNIFICATION

Section 1.  Indemnification – Third  Party and Derivative Actions .

(a)              The corporation shall indemnify any person made, or threatened to be made, a party to an action or proceeding, whether civil or criminal (other than one by or in the right of the corporation to procure a judgment in its favor), including an action by or in the right of any other corporation of any type or kind, domestic or foreign, or any partnership, joint venture, trust, employee benefit plan or other enterprise, which any director, officer or employee of the corporation served in any capacity at the request of the corporation, by reason of the fact that the person is or was a director or officer of the corporation, or is or was serving such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise in any capacity, against judgments, fines, including excise taxes, amounts paid in settlement and expenses, including attorneys’ fees, incurred in connection with any such action or proceeding, or any appeal therein, provided that no indemnification may be made to or on behalf of such person if a judgment or other final adjudication adverse to such person establishes that (i) his or her acts were committed in bad faith or were the result of his or her active or deliberate dishonesty and were material to such action or proceeding or (ii) he or she personally gained in fact a financial profit or other advantage to which he or she was not legally entitled.

 

 

(b)              The corporation shall indemnify any person made, or threatened to be made, a party to an action by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director or officer of the corporation, or is or was serving at the request of the corporation as a director or officer of any other corporation of any type or kind, domestic or foreign, or of any partnership, joint venture, trust, employee benefit plan or other enterprise, against amounts paid in settlement and expenses, including attorneys’ fees, incurred in connection with such action, or any appeal therein, provided that no indemnification may be made to or on behalf of such person if (i) his or her acts were committed in bad faith or were the result of his or her active and deliberate dishonesty and were material to such action or (ii) he or she personally gained in fact a financial profit or other advantage to which he or she was not legally entitled.

(c)              The termination of any civil or criminal action or proceeding by judgment, settlement, conviction or upon a plea of nolo contendere , or its equivalent, shall not in itself create a presumption that any such person has not met the standard of conduct set forth in this Section 1.

Section 2.  Payment of Indemnification; Repayment .

(a)              A person who has been successful, on the merits or otherwise, in the defense of a civil or criminal action or proceeding of the character described in Section 1 of this Article shall be entitled to indemnification as authorized in such Section.

(b)              Any indemnification under Section 1 of this Article, unless ordered by a court, shall be made by the corporation in such manner as provided by law.

(c)              Expenses incurred by a person referred to in Section 1 of this Article in defending a civil or criminal action or proceeding shall be paid by the corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of such person to repay such amount in case he or she is ultimately found, in accordance with this Article, not to be entitled to indemnification or, where indemnity is granted, to the extent the expenses so paid exceed the indemnification to which he or she is entitled.

(d)              Any indemnification of a person under Section 1 of this Article, or advancement of expenses under Section 2(c) of this Article, shall be made promptly, and in any event within 60 days, upon the written request of such person.

Section 3.  Enforcement; Defenses .   The right to indemnification or advancement of expenses granted by this Article shall be enforceable by the person in

question in any court of competent jurisdiction if the corporation denies such request, in whole or in part, or if no disposition thereof is made within 60 days.  Such person’s expenses incurred in connection with successfully establishing his or her right to indemnification, in whole or in part, in any such action shall also be indemnified by the corporation.  It shall be a defense to any such action (other than an action brought to enforce a claim for the advancement of expenses under Section 2(c) of this Article where the required undertaking has been received by the corporation) that the claimant has not met the standard of conduct set forth in Section 1 of this Article, but the burden of proving such defense shall be on the corporation.  Neither the failure of the corporation to have made a determination that indemnification of the claimant is proper, nor the fact that there has been an actual determination by the corporation that indemnification of the claimant is not proper, shall be a defense to the action or create a presumption that the claimant is not entitled to indemnification.

 

Section 4.   Other Indemnitors .  As to each director of the corporation elected or designated for nomination solely by the holders of shares of any class or series of preferred stock (or shares of common stock issued upon conversion of such shares of preferred stock), the corporation shall be the indemnitor of first resort with respect to each matter for which the corporation is subject to an indemnification or advancement of expenses obligation pursuant to this Article XII (i.e., the corporation’s obligations shall be primary and any obligation of other entities shall be secondary).  The corporation shall not seek contribution, subrogation or any other recovery from any such other entity in respect of any of the corporation’s obligations to such director under Article XII.

Section 5.  Survival; Savings Clause; Preservation of Other Rights .

(a)              The foregoing indemnification provisions shall be deemed to be a contract between the corporation and each person who serves in such capacity at any time while these provisions as well as the relevant provisions of the New York Business Corporation Law are in effect and any repeal or modification thereof shall not affect any right or obligation then existing with respect to any state of facts then or previously existing or any action or proceeding previously or thereafter brought or threatened based in whole or in part upon any such state of facts.  Such a contract right may not be modified retroactively without the consent of such person.

(b)              If this Article or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the corporation shall nevertheless indemnify each such person against judgments, fines, amounts paid in settlement and expenses, including attorneys’ fees, incurred in connection with any actual or threatened action by or in the right of the corporation, or any appeal therein, to the full extent permitted by any

applicable portion of this Article that shall not have been invalidated and to the full extent permitted by applicable law.

 

(c)              The indemnification provided by this Article shall not be deemed exclusive of any other rights to which those indemnified may be entitled under any by-law, agreement, vote of shareholders or directors or otherwise, both as to action in his or her official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer or employee of the corporation and shall inure to the benefit of the heirs, executors and administrators of such a person.  The corporation is hereby authorized to provide further indemnification if it deems it advisable by resolution of shareholders or directors, by amendment of these by-laws or by agreement.

*            *            *

For purposes of these by-laws, the masculine pronoun means the feminine and the singular means the plural whenever appropriate.