2011 Transition Incentive Cash Program – Avon Products

AVON PRODUCTS, INC.

2011 TRANSITION INCENTIVE CASH PROGRAM

EFFECTIVE JANUARY 1, 2011

I.

PURPOSE.

The purpose of this Avon Products, Inc. 2011 Transition Incentive Cash
Program is to link a portion of the total pay of eligible participants to the
business growth success of Avon Products, Inc. and its Affiliates during 2011.
This Program is part of the transition of Avon Products, Inc. implementation of
providing incentive compensation during overlapping three-year Long-Term
Performance Periods.

II.	DEFINITIONS.

Capitalized terms used in this Program and not defined herein shall have the
meaning set forth in the Avon Products, Inc. 2008-2012 Executive Incentive Plan,
as amended, or any successor plan (“Executive Incentive Plan”). Additionally,
the following terms shall have the following meanings:

“Disability” has the meaning provided in the long-term disability
plan or policy maintained or, if applicable, most recently maintained, by the
Company or, if applicable, any Affiliate of the Company. If no long-term
disability plan or policy was ever maintained on behalf of the Participant,
Disability shall mean that condition described in Section 22(e)(3) of the Code,
as amended from time to time. In the event of a dispute, the determination of a
Disability shall be made by the Committee and shall be supported by advice of a
physician competent in the cure to which such Disability relates. Subject to the
approval of the Committee, a different definition of Disability may be
applicable to a Participant employed outside of the U.S. who is subject to local
disability laws and programs.

“Performance Period” means 2011.

“Performance Period Bonus” means the cash bonus payable to a
Participant pursuant to this Program with respect to 2011 as determined pursuant
to Article V.

“Potential Change in Control” means:

(i) the commencement of a tender or exchange offer by any third person for
30% or more of the then outstanding shares of common stock or combined voting
power of the Company’s then outstanding voting securities;

(ii) the execution of an agreement by the Company, the consummation of which
would result in the occurrence of a Change in Control;

(iii) the public announcement by any person, including the Company, of an
intention to take or to consider taking actions which if consummated would
constitute a Change in Control; or

---

(iv) the adoption by the Board, as a result of other circumstances, including
circumstances similar or related to the foregoing, of a resolution to the effect
that a Potential Change in Control has occurred.

“Program” means this Avon Products, Inc. 2011 Transition Incentive
Cash Program.

“Retirement” means a Participant’s Separation from Service with the
Company or an Affiliate on or after (i) the Participant’s 65th birthday;
(ii) the Participant’s 55th birthday if the Participant has completed at least
15 years of Credited Service (as described in the Company’s Personal Retirement
Account Plan); (iii) the date the Participant is eligible for early or normal
retirement under any retirement plan of the Company or its Affiliates that
applies to such Participant; (iv) the Participant’s attainment of his 55th
birthday and completion of ten years of service with the Company or an
Affiliate; or (v) the Participant’s attainment of his 60th birthday and the
completion of five years of service with the Company or an Affiliate. For those
Participants located outside the U.S., Participants will be considered to have
retired based on the local policies, practices or benefit plans applicable to
the Participant’s location.

III.	ADMINISTRATION.

The administration and operation of the Program shall be supervised by the
Committee with respect to all matters. The Committee may delegate responsibility
for the day-to-day administration and operation of the Program to such employees
of the Company as it shall designate from time to time. The Committee shall
interpret and construe any and all provisions of the Program and any
determination made by the Committee under the Program shall be final and
conclusive. Neither the Board nor the Committee, nor any member of the Board or
the Committee, nor any employee of the Company shall be liable for any act,
omission, interpretation, construction or determination made in connection with
the Program (other than acts of willful misconduct) and the members of the Board
and the Committee and the employees of the Company shall be entitled to
indemnification and reimbursement by the Company to the maximum extent permitted
by law in respect of any claim, loss, damage or expense (including counsel’s
fees) arising from their acts, omissions and conduct in their official capacity
with respect to the Program.

IV.	ELIGIBILITY AND PARTICIPATION.

The Committee shall select the employees of the Company or its Affiliates to
participate in the Program. An Award to a Participant subject to Section 162(m)
of the Code shall be granted under the Executive Incentive Plan, and be subject
to the terms thereof.

V.	PERFORMANCE PERIOD BONUS.

5.1. Performance Goals. The Performance Period Bonus will be
assessed against Performance Measures contained in the Company’s Executive
Incentive Plan and determined by the Committee within the first ninety (90) days
of the Performance Period.

2

---

5.2. Performance Period Bonus. The Committee shall establish during
the first ninety (90) days of the Performance Period the formula for calculating
the Performance Period Bonus for each Participant. The Performance Period Bonus
for any Participant, when added to the payment under the Company’s annual
incentive program for 2011 to the Participant, may not exceed $6,000,000 (the
annual limitation set forth in the Executive Incentive Plan for annual incentive
awards).

5.3. Determination of Achievement of Performance Goals. The
Committee shall determine and certify the level of achievement of the
performance goals as soon as practicable after the end of the Performance
Period. The Committee may increase or decrease the Performance Period Bonus
based on the Committee’s quantitative and qualitative assessment and in its sole
discretion; provided that the Performance Period Bonus may not be increased for
any Participant subject to Section 162(m) of the Code.

5.4. Payment of Performance Period Bonus.

(a) Except as provided below, Participants who remain actively employed until
December 31, 2013 shall be entitled to receive payment of the Performance Period
Bonus, if any, determined in accordance with this Article V.

(i) A Participant who incurs an involuntary Separation from Service without
Cause on or after January 1, 2012 but who will not be eligible for Retirement at
the end of a salary continuation period for which the Participant is eligible
under a severance pay plan of the Company or some other agreement between the
Company and the Participant, in either case as in effect on the date hereof, but
prior to December 31, 2013, shall be eligible for a prorated Performance Period
Bonus payable during 2014, provided that the performance goal(s) are satisfied
in accordance with this Article V.

(ii) A Participant who incurs a voluntary Separation from Service due to
Retirement on or after January 1, 2012, or a Participant who incurs an
involuntary Separation from Service other than for Cause on or after January 1,
2012 who will be eligible for Retirement at the end of the payment period for
which the Participant is eligible under a severance pay plan of the Company or
some other agreement between the Participant and the Company (as if the
Participant made any available election under such plan or agreement to extend
the salary continuation period by the maximum period available to the
Participant), in either case as in effect on the date (disregarding any election
permitted by the Participant under such plan or agreement), then, provided that
the performance goal(s) have been satisfied, the Participant shall be entitled
to a prorated Performance Period Bonus, payable during 2014.

(iii) A Participant who dies or incurs a Separation from Service due to
Disability prior to December 31, 2013 will be eligible for a prorated
Performance Period Bonus payable during 2014, provided that the performance
goal(s) are satisfied in accordance with this Article V.

3

---

(iv) A Participant is not eligible for a Performance Period Bonus if he or
she: (w) incurs an involuntary Separation from Service by the Company for Cause
prior to payment of the Performance Period Bonus; (x) subject to Section 5.4(c),
incurs an involuntary Separation from Service by the Company without Cause prior
to January 1, 2012; (y) incurs a voluntary Separation from Service due to
Retirement prior to January 1, 2012; or (z) incurs a voluntary Separation from
Service from the Company (excluding Retirement on or after January 1, 2012,
Disability, or a voluntary Separation from Service for a Change in Control Good
Reason) at any time prior to December 31, 2013.

(b) Payment of Performance Period Bonuses shall be made in 2014, except to
the extent that such Participant elected to defer the receipt of a portion of
his or her Performance Period Bonus in accordance with subsection (e) hereof or
as provided in Section 5.4(c) below, if applicable.

(c) Prior to the payment of the Performance Period Bonus, if (w) and
(x) occurs, where (w) is a Change in Control which occurs prior to the payment
of the Performance Period Bonus, and where (x) is a Separation from Service
following such Change in Control, either: (y) by the Company without Cause
within two years of the Change in Control; or (z) due to the Participant
incurring a Change in Control Good Reason, then the Performance Period Bonus
will be calculated and paid, if payable, promptly following the Participant’s
Separation from Service for (y) or (z) only, subject to Section 5.5, and in
accordance with (i), (ii) or (iii) below:

(i) If the Separation from Service occurs before July 1, 2011, the
Performance Period Bonus is fully vested and calculated as if the Award had been
achieved at target but prorated;

(ii) If the Separation from Service occurs on or after July 1, 2011 but prior
to January 1, 2012, the Performance Period Bonus is fully vested and calculated
as if the Award had been achieved at target, without proration;

(iii) If the Separation from Service occurs on or after January 1, 2012 but
prior to payment of the Performance Period Bonus, the Performance Period Bonus
is fully vested and calculated based on the achievement of the Performance
Measures.

Effective upon a Change in Control, each outstanding Performance Period Bonus
must be continued in accordance with its terms and conditions in effect on the
date of the Change in Control. If the Performance Period Bonus is not so
continued, notwithstanding the other provisions of this Section 5.4(c), the
Performance Period Bonus shall be fully vested and paid in cash at target,
without proration, promptly following the Change in Control.

(d) For purposes of this Section 5.4, a “prorated” Performance Period Bonus
means a bonus calculated by multiplying the Performance Period Bonus (or target
Award for purposes of Section 5.4(c)) by a fraction, which shall be the number
of complete months from the beginning of the Performance Period to the date of
Separation from Service, divided by the number of months from the beginning of
the Performance Period to December 31, 2013.

4

---

(e) A Participant may elect to defer the receipt of a portion of his or her
Performance Period Bonus to the DCP, provided that such deferral election is
made in accordance with the DCP and Section 409A of the Code. Such deferred
amounts shall then be subject to the terms and conditions of the DCP and
Section 409A of the Code, including, without limitation, limitations on
receiving payments from the DCP.

(f) For purposes of determining proration under Section 5.4(d), a paid or
unpaid leave of absence of the Participant shall not constitute a Separation
from Service of the Participant, except to the extent that the leave of absence
constitutes a “separation from service” (as defined in Section 409A of the
Code). The Participant’s employment by an Affiliate shall be considered a
Separation from Service on the date on which such Affiliate ceases to be an
Affiliate; provided that, in such event, any Performance Period Bonus shall be
paid, if payable, after the Performance Period as herein specified and subject
to the achievement of the Performance Measures.

5.5. Six-Month Wait under Section 409A. To the extent that a
Performance Period Bonus is a non-exempt amount payable under a “nonqualified
deferred compensation plan” (as defined in Code Section 409A) upon a Separation
from Service (other than death) and if the Participant is a “specified employee”
(as that term is defined in Code Section 409A and pursuant to procedures
established by the Company) on a Participant’s Separation from Service, then any
Performance Period Bonus payable pursuant to Section 5.4(c)(i), (ii) or
(iii) will not be paid to the Participant during the six-month period
immediately following the Separation from Service. Instead, the Performance
Period Bonus that would have been payable to the Participant shall be paid on
the first day of the seventh month following the Participant’s Separation from
Service.

VI.	GENERAL PROVISIONS.

6.1. Amendment and Termination.

(a) The Committee may at any time amend, suspend, discontinue or terminate
this Program; provided, however, that no such amendment, suspension,
discontinuance or termination made after the end of the Performance Period shall
adversely affect the rights of any Participant to any Performance Period Bonus;
and provided further that any termination of this Program shall comply with
Section 409A of the Code except to the extent otherwise permitted by the
Committee at such time. All determinations concerning the interpretation and
application of this Section 6.1 shall be made by the Committee. On and after a
Change in Control, the Committee may not amend or terminate any Performance
Period Bonus in a manner that adversely affects such Performance Period Bonus
without the consent of the holder of the Performance Period Bonus.

(b) In the case of Participants employed outside of the United States, the
Company or its Affiliates may vary the provisions of this Program as deemed
appropriate to conform with, as required by, or made desirable by, local laws,
practices and procedures or, in their respective discretion, to accelerate
payment to any such Participant in order to pay taxes associated with Awards
that are deemed to be includible in income prior to actual payment.

5

---

6.2. Designation of Beneficiary. In the event a Participant dies
while entitled to a payment under the Program, such payments shall be made to
the Participant’s estate.

6.3. Rights Unsecured. The right of any Participant to receive a
Performance Period Bonus shall constitute an unsecured claim against the general
assets of the Company. The Committee may, however, in the event of a Potential
Change in Control, determine to deposit an amount sufficient to pay the
Performance Period Bonus for each Participant calculated as set forth in
Section 5.4(c) into a grantor trust, subject to the claims of the Company’s
creditors in the event of the Company’s insolvency. The grantor trust shall
serve as a source of payment of the Performance Period Bonus calculated as set
forth in Section 5.4(c) if the Participant is involuntarily terminated by the
Company without Cause, or terminates for a Change in Control Good Reason, after
the Change in Control but prior to payment of the Performance Period Bonus. If
the Change in Control does not occur prior to payment of the Performance Period
Bonus and the Company pays the Performance Period Bonus after the end of the
Performance Period to each Participant in an amount not less than the amount set
forth in Section 5.4(c), the Company may recoup the amount so deposited in the
grantor trust or other segregated arrangement together with earnings thereon.

6.4. Withholding Taxes. The Company shall have the right to deduct
from each Performance Period Bonus any federal, state and local taxes required
by such laws to be withheld with respect to any payment of the Performance
Period Bonus.

6.5. Compensation Recoupment Policy. For those Participants who are
subject to the Company’s Compensation Recoupment Policy as may be amended from
time to time, Awards are subject to the Company’s Compensation Recoupment
Policy.

6.6. Miscellaneous.

(a) No Right of Continued Employment. Nothing in this Program shall
be construed as conferring upon any Participant any right to continue in the
employment of the Company or any of its subsidiaries or Affiliates.

(b) No Limitation on Corporate Actions. Nothing contained in this
Program shall be construed to prevent the Company or any Affiliate from taking
any corporate action which is deemed by it to be appropriate or in its best
interest, whether or not such action would have an adverse effect on this
Program or any awards made hereunder. No employee, Participant or other person
shall have any claim against the Company or any of its subsidiaries or
Affiliates as a result of any such action.

(c) Nonalienation of Benefits. Except as expressly provided herein,
no Participant shall have the power or right to transfer, anticipate, or
otherwise encumber the Participant’s interest under this Program. The Company’s
obligations under this Program are not assignable or transferable except that
the Company’s obligations hereunder shall become the obligations of a company
which acquires all or substantially all of the assets of the Company or any
company into which the Company may be merged or consolidated.

(d) Severability. If any provision of this Program is held
unenforceable, the remainder of the Program shall continue in full force and
effect without regard to such unenforceable provision and shall be applied as
though the unenforceable provision were not contained in the Program.

6

---

(e) Governing Law. This Program shall be construed in accordance
with and governed by the laws of the State of New York, without reference to the
principles of conflict of laws.

(f) Section 162(m) and Section 409A of the Code. To the extent that
any Award is intended to qualify as “performance-based compensation” within the
meaning of Section 162(m) of the Code or is subject to Section 409A of the Code,
any provision, application or interpretation of this Program that is
inconsistent with such Sections shall be disregarded with respect to such Award,
as applicable. In no event shall the Company, any of its Affiliates, any of it
agents, or any member of the Board have any liability for any taxes imposed in
connection with a failure of the Plan to comply with Section 409A of the Code.

6.7. Change in Control Policy/Employment Agreements. This Program
shall not be subject to the Avon Products, Inc. Change in Control Policy. The
Program shall be a long-term incentive program for purposes of any employment
agreement between the Company and a Participant.

[Signature on Next Page]

7

---

IN WITNESS WHEREOF, the Company has caused this Program to
be executed on the 2^nd day of March, 2011.

AVON PRODUCTS, INC.
By:		/s/ Lucien Alziari
		Name: Lucien Alziari
		Title: SVP, HR

8