Coty Inc. (NASDAQ:COTY) Files An 8-K Entry into a Material Definitive Agreement

On January 10, 2017, Coty Inc., a Delaware corporation (Parent),
entered into a Contribution Agreement (the Contribution
Agreement) with Coty US Holdings Inc., a Delaware corporation
(Coty US), Foundation, LLC, a Delaware limited liability company
and wholly-owned subsidiary of Coty US (NewCo), Younique, LLC, a
Utah limited liability company (Younique), UEV Holdings, LLC, a
Delaware limited liability company (Aspen Sub), Aspen Cove
Holdings, Inc., a Utah corporation and the majority unit holder
of Younique (the Majority Unit Holder), each of the other unit
holders of Younique (the Minority Unit Holders and, together with
the Majority Unit Holder, the Unit Holders), and Derek Maxfield,
in his individual capacity and as the Unit Holder Representative
thereunder (D. Maxfield).

The Contribution Agreement provides for, subject to the
satisfaction or waiver of the closing conditions therein: (a) the
contribution by the Unit Holders of all of the issued and
outstanding units of Younique to NewCo (the First Contribution),
in exchange for NewCo (i) paying $600,000,000 to the Unit
Holders, subject to customary adjustments, and (ii) issuing 400
membership interests in NewCo (the Equity Consideration) to
certain of the Unit Holders (the Continuing Unit Holders); and
(b) immediately following the consummation of the First
Contribution, the contribution by the Continuing Unit Holders of
all of the Equity Consideration to Aspen Sub in exchange for
equity in Aspen Sub (the Second Contribution and, together with
the First Contribution, the Contributions). As a result of the
Contributions, Younique will be a wholly-owned subsidiary of
NewCo, with Coty US and Aspen Sub owning sixty percent (60%) and
forty percent (40%), respectively, of the issued and outstanding
membership interests of NewCo.

First Amended and Restated Limited Liability Company Agreement

to the Contribution Agreement, at the closing of the First
Contribution (the Closing), Coty US, each of the Continuing Unit
Holders and Aspen Sub will enter into the First Amended and
Restated Limited Liability Company Agreement, the form of which
is attached as an exhibit to the Contribution Agreement (the AR
LLC Agreement), which agreement will, among other things,
establish Coty USs and the Continuing Unit Holders (and, upon
consummation of the Second Contribution, Aspen Subs) ownership of
and governing relationship with respect to NewCo. Immediately
following the Second Contribution, the only members of NewCo will
be Coty US and Aspen Sub, which will own sixty percent (60%) and
forty percent (40%), respectively, of the issued and outstanding
membership interests of NewCo. In addition, it is expected that
NewCo will also create an employee equity incentive plan which
would provide NewCo with the ability to award to eligible
participants non-voting membership interests in NewCo.

Management of NewCo. to the AR LLC Agreement, NewCo will be
managed by a board of directors (the NewCo Board) consisting of
three (3) directors designated by Coty US and two (2) directors
designated by Aspen Sub. The NewCo Board will generally have
discretion and authority in the management and control of NewCo,
except for certain specified activities that will be subject to
the unanimous approval of the holders of NewCos voting membership
interests (collectively, the Voting Members). Such activities
will include, among other things: (i) amendments to NewCos
certificate of formation or the AR LLC Agreement; (ii)
consolidations, recapitalizations or mergers involving NewCo or
dispositions of material subsidiaries of NewCo; (iii) certain
incurrences of indebtedness and issuances of equity securities by
NewCo; and (iv) certain acquisitions of other companies,
businesses or assets by NewCo.

Transfer and Liquidity Rights. Subject to certain limited
exceptions, the AR LLC Agreement will generally prohibit
transfers of membership interests in NewCo absent the unanimous
approval of the Voting Members.

Coty US may be permitted or obligated to purchase the NewCo
membership interests owned by Aspen Sub> to put, call and
other liquidity rights or obligations in certain circumstances.
The purchase price for the NewCo membership interests owned by
Aspen Sub will generally be the fair market value of NewCo (as
determined to the AR LLC Agreement) multiplied by the percentage
of the membership interests owned by Aspen Sub, provided that, in
certain circumstances, a premium will be added or a discount will
be subtracted from such amount. Coty US will have the option to
pay the purchase price in cash, stock of Parent (or of such other
ultimate parent entity

that wholly-owns Coty US) or a combination of both, and any stock
that is so paid and is not freely tradeable will be subject to a
customary registration rights agreement.

Contribution Agreement

Closing Conditions. The Closing is subject to the satisfaction or
waiver of specified closing conditions, including, among other
things: (i) the retention of certain key employees of Younique
(including D. Maxfield and Melanie Huscroft, the founders of
Younique) (collectively, the Key Employees) through the Closing,
and the delivery by each Key Employee of a certificate
confirming, among other matters, such Key Employees willingness
to be an employee of NewCo to the terms and conditions of an
employment agreement with NewCo; (ii) the ancillary agreements to
the Contribution Agreement being in full force and effect as of
the Closing, including the employment agreements between NewCo,
on the one hand, and each Key Employee, on the other hand; and
(iii) the expiration or early termination of any applicable
waiting period under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended.

Representations, Warranties, Covenants and Indemnification.
Parent, Coty US, NewCo, Younique, Aspen Sub, the Unit Holders and
D. Maxfield have each made customary representations and
warranties. Furthermore, each of Younique, Aspen Sub, the Unit
Holders and D. Maxfield have agreed to certain covenants and
agreements, including, among others: (i) D. Maxfield and Younique
agreeing to conduct the business and operations of Younique and
its subsidiaries in the ordinary course and consistent with past
practices during the period between the signing of the
Contribution Agreement and the Closing; and (ii) certain of the
Unit Holders, D. Maxfield, Parent and Coty US agreeing to certain
customary indemnification obligations.

>Termination; Termination Fees. The Contribution Agreement
provides Parent and Coty US, on the one hand, and D. Maxfield (as
the Unit Holder Representative), on the other hand, with certain
customary termination rights prior to the Closing. If the
Contribution Agreement is terminated under certain specified
circumstances related to antitrust laws, Parent and Coty US will
be obligated to pay Younique an $18,000,000 termination fee.

Item 7.01 Regulation FD Disclosure.

A copy of the press release issued by Parent on January 10, 2017
announcing the execution of the Contribution Agreement is
furnished as Exhibit 99.1 hereto. Additionally, the investor
presentation that will be used in presentations to existing and
potential stockholders of Parent in respect of the transactions
contemplated by the Contribution Agreement is furnished as
Exhibit 99.2 hereto.

Such information (including Exhibits 99.1 and 99.2 hereto) shall
not be deemed filed for purposes of Section 18 of the Securities
and Exchange Act of 1934, as amended (the Exchange Act), nor
shall it be deemed incorporated by reference in any filing under
the Exchange Act, except as shall be expressly set forth by
specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d)