FALSE000102430500010243052023-05-042023-05-04
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of Report (Date of earliest event reported): May 5, 2023 (May
4, 2023)
Coty Inc.
(Exact Name of Registrant as Specified in its Charter)
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Delaware |
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001-35964 |
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13-3823358 |
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(State or other Jurisdiction
of Incorporation)
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(Commission File Number) |
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(I.R.S. Employer
Identification No.)
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350 Fifth Avenue
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New York,
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NY
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10118 |
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(Address of Principal Executive Offices) |
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(Zip Code) |
Registrant’s telephone number, including area code:
(212) 389-7300
(Former name or former address, if changed from last
report)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions:
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☐ |
Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425) |
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☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e-4(c)) |
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Title of each class |
Trading symbol(s) |
Name of each exchange on which registered |
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Class A Common Stock, $0.01 par value |
COTY |
New York Stock Exchange |
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Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933
(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§240.12b-2 of this chapter). Emerging growth
company ☐
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange
Act.o
Item 5.02 Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
New Compensatory Arrangements for Chief Executive
Officer
On May 5, 2023, the Board of Directors (the “Board”) of Coty Inc.
(the “Company”) announced its intention to explore a dual listing
of the Company on the Paris Stock Exchange (Euronext Paris) and the
entry into a new compensatory program for the Company’s Chief
Executive Officer, Sue Y. Nabi. On May 4, 2023 the Board and Ms.
Nabi entered into an amendment (the “Amendment”) to that certain
employment agreement dated as of October 13, 2020, by and between
Ms. Nabi and the Company (the “Original Agreement” and, as amended
by the Amendment, the “Agreement”) to set forth these new terms.
Ms. Nabi has served as the Company’s Chief Executive Officer since
September 2020.
Under the terms of the new arrangement, the Board has designed a
long-term equity program for Ms. Nabi (the “Nabi Equity Program”)
with equity awards vesting through 2030 which further solidify Ms.
Nabi’s position as one of the Company’s largest stockholders and
enhance her focus on building long-term stockholder value. Half of
the equity to be granted under the Nabi Equity Program will be
subject to the achievement of Company performance
objectives.
If fully realized, the Nabi Equity Program will result in Ms. Nabi
acquiring an additional 20,833,334 shares of Common Stock over the
seven-year vesting horizon.
Ms. Nabi will also become eligible to participate in the Company’s
performance-based annual cash bonus plan under the new
arrangement.
As part of the Company’s efforts to reduce dilution, the Company
entered into forward repurchase contracts in June and December 2022
for $200 million and $196 million of share buybacks in calendar
year 2024 and calendar year 2025, respectively (the “2022 Forward
Repurchase Contracts”) with several bank counterparties. Under the
2022 Forward Repurchase Contracts, the bank counterparties
effectively locked in an average weighted share price of $7.99 for
this future share buyback program. The 2022 Forward Repurchase
Contracts give the Company the ability to repurchase up to
approximately 49.5 million shares of Common Stock at these
attractive average prices over 2024 and 2025, which the Company can
use a portion of to offset the potential impact from the maximum 21
million shares of Common Stock which may be issuable by the Company
to Ms. Nabi over the next seven years under the Nabi Equity
Program.
Annual Bonus Plan
Under the terms of the new arrangement, in addition to her annual
base salary in the amount of €3,000,000 (the “Base Salary”), which
remains unchanged, effective July 1, 2023 Ms. Nabi will be eligible
to participate in the Company’s performance-based annual cash bonus
plan (the “Annual Bonus Plan”). Ms. Nabi will participate under the
Annual Bonus Plan with a target of 100% of her Base Salary, a
maximum of 200%, and a minimum of 0% if certain threshold
conditions are not achieved. The performance objectives for the
Annual Bonus Plan will be determined annually by the
Board.
Nabi Equity Program
The Nabi Equity Program is comprised of a one-time award of
restricted stock units (“RSUs”) and an annual award of performance
restricted stock units (“PRSUs”) with three-year Company
performance objectives.
Pursuant to the terms of the Amendment, on May 4, 2023 the Company
granted Ms. Nabi 10,416,667 RSUs (the “RSU Award”), which will vest
and settle in shares of the Company’s Class A Common Stock, par
value $0.01 per share (the “Common Stock”) over five years on the
following vesting schedule: (i) 15% of the RSU Award on September
1, 2024 (“Tranche 1 RSUs”), (ii) 15% of the RSU Award on September
1, 2025 (“Tranche 2 RSUs”), (iii) 20% of the RSU Award on September
1, 2026 (“Tranche 3 RSUs”), (iv) 20% of the RSU Award on September
1, 2027 (“Tranche 4 RSUs”); and (v) 30% of the RSU Award on
September 1, 2028 (“Tranche 5 RSUs”), in each case subject to Ms.
Nabi’s continued employment through the applicable vesting date. If
Ms. Nabi is involuntarily terminated by the Company without cause
or due to death or disability on or prior to September 1, 2026, to
the extent not already vested, all of the Tranche 1 RSUs, Tranche 2
RSUs, and Tranche 3 RSUs shall become fully vested on the date of
such termination.
If Ms. Nabi is involuntarily terminated by the Company without
cause or due to death or disability
on or following September 1, 2026 but before September 1, 2027, a
pro-rata portion of the Tranche 4 RSUs shall vest on the date of
such termination equal to the number of Tranche 4 RSUs multiplied
by a fraction, the numerator of which is the number of days elapsed
from September 1, 2026 to the date of Ms. Nabi’s termination and
the denominator of which is 365.
If Ms. Nabi is involuntarily terminated by the Company without
cause or due to death or disability
on or following September 1, 2027 but before September 1, 2028, a
pro-rata portion of the Tranche 5 RSUs shall vest on the date of
such termination equal to the number of Tranche 5 RSUs multiplied
by a fraction, the numerator of which is the number of days elapsed
from September 1, 2027 to the date of Ms. Nabi’s termination and
the denominator of which is 365. If Ms. Nabi leaves voluntarily or
is terminated for cause, any portion of the RSU Award not vested as
of the date of termination will be forfeited.
On May 4, 2023, pursuant to the terms of the new arrangement the
Company also granted Ms. Nabi an award of 2,083,333 PRSUs which
shall fully vest on September 1, 2026 subject to the achievement of
three-year performance objectives to be determined by the Board and
subject to Ms. Nabi’s continued employment. The new arrangement
also provides that on or around each of September 1, 2024,
September 1, 2025, September 1, 2026, and September 1, 2027, the
Company shall grant to
Ms. Nabi an additional award of 2,083,333 PRSUs on each such
respective date, which shall vest on the third-year anniversary of
the respective grant date, subject in each case to the achievement
of three-year performance objectives to be determined by the Board
and Ms. Nabi’s continued employment through the applicable vesting
date.
Reload Options
In the event that Ms. Nabi enters into a “tag along” agreement with
the Company’s largest stockholder, JAB Beauty B.V. (formerly known
as Cottage Holdco B.V.) (“JAB”), and Ms. Nabi participates in a
“tag along” sale with JAB whereby JAB and Ms. Nabi sell shares of
Common Stock for cash in a privately negotiated transaction (i.e.,
not a public offering), subject to Board approval the Company will
grant Ms. Nabi new options to acquires shares of Common Stock (the
“Reload Options”) in an amount equal to the number of shares sold
by Ms. Nabi in such transaction. The Reload Options will have a
strike price equal to the greater of the volume weighted average
price for shares at the time of the relevant transaction and the
fair market value on the date of grant.
The foregoing description of the new compensatory arrangement is
qualified in its entirety by reference to the full text of the
Amendment, a copy of which will be attached to the Company’s Annual
Report on Form 10-K for the period ended June 30,
2023.
On May 5, 2023, the Company issued a press release announcing its
intention to explore a dual listing on the Paris Stock Exchange
(Euronext Paris) and the new compensatory arrangement with Ms. Nabi
(the “Press Release”). A copy of the press release is furnished
herewith as Exhibit 99.1 to this Current Report on Form
8-K.
Item 9.01 Financial Statements and Exhibits
(d)Exhibits:
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Exhibit No.
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Description
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL
document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly
authorized.
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Coty Inc.
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(Registrant)
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Date: May 5, 2023
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By:
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/s/ Kristin Blazewicz |
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Kristin Blazewicz |
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Chief Legal Officer, General Counsel and Secretary |
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Coty (NYSE:COTY)
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