Exhibit 10.6
SUBSCRIPTION AGREEMENT
This Subscription Agreement (this “Agreement”), dated February 16, 2017, is by
and between, Coty Inc., a Delaware corporation (the “Parent”) and Sébastien
Froidefond (the “Subscriber”) and collectively as “Parties”.
RECITALS
WHEREAS, Coty Services UK Limited (“Coty UK”) and Subscriber are parties to that
certain Employment Agreement, dated as of June 7, 2016 (the “Employment
Agreement”).
WHEREAS, the Parent and the Subscriber desire to enter into this Agreement to
obligate the Subscriber to acquire shares of preferred stock of the Parent (as
described below) to be delivered to the Subscriber pursuant to and subject to
the terms of the Coty Inc. Equity and Long-Term Incentive Plan (the “Plan”).
WHEREAS, the Parent desires to issue and sell to Subscriber, and Subscriber
desires to purchase from the Parent, 481,539 shares of Series A Preferred Stock
of the Parent (the “Shares”), with the terms and conditions substantially as set
forth in that Certificate of Designations filed with the Secretary of State of
the State of Delaware relating to the Shares, including the various and several
voting powers, preferences and relative, participating, optional or other
rights, and the qualifications, limitations and restrictions thereof set forth
in Annex A hereto, for an aggregate cash payment equal to $4,815.39 (the
“Purchase Price”), subject to the terms and conditions described herein.
AGREEMENT
NOW THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements herein contained, and intending to be legally bound hereby, the
parties agree as follows:
ARTICLE I
PURCHASE AND SALE
Section 1.1    Purchase and Sale of the Shares. Upon the terms and subject to
the conditions of this Agreement, at the Closing, subject to Board approval the
Parent agrees to issue and sell to the Subscriber, and the Subscriber agrees to
purchase from the Parent, the Shares for an aggregate cash purchase price equal
to the Purchase Price. The sale and purchase of the Shares shall take place at a
closing (the "Closing") to be held at the offices of Coty Inc., on February 16,
2017, at 350 Fifth Avenue, New York, New York 10119, or at such other place or
at such other time or on such other date as the Parent and the Subscriber
mutually may agree in writing. The day on which the Closing takes place is
referred to as the "Closing Date."
(a)    At the Closing, the Parent shall deliver to Wells Fargo Shareowner
Services (the “Transfer Agent”) an instruction letter authorizing and directing
the Transfer Agent to record in the share register of the Parent book entry
positions representing the Shares issued in the name of the Subscriber.

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(b)     At the Closing, the Subscriber shall deliver to the Parent the Purchase
Price in cash.
 
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE PARENT
The Parent hereby represents and warrants to the Subscribers as follows:
Section 2.1    Organization and Qualification. The Parent is a corporation duly
organized, validly existing and in good standing under the laws of the state of
Delaware. The Parent has all requisite power, right and authority to carry on
its business as now conducted.
Section 2.2    Share Issuance. The Shares to be issued to the Subscriber
pursuant to this Agreement, when issued and delivered in accordance with the
terms of this Agreement, will be free and clear of all liens and other
encumbrances, duly and validly issued and will be fully paid and non-assessable
and free from preemptive rights.
Section 2.3    Authority. The Parent has full corporate power and authority to
execute, deliver and perform its obligations under this Agreement. This
Agreement has been duly executed and delivered by the Parent and is legal,
valid, binding and enforceable upon and against the Parent.
Section 2.4    No Conflict; Required Filings and Consents. The execution,
delivery and performance by the Parent of this Agreement and the consummation by
the Parent of the transactions contemplated hereby do not and will not
(a) violate any provision of the certificate of incorporation or bylaws (or
similar organizational documents) of the Parent; (b) violate any federal, state
or local statute, law, regulation, order, injunction or decree (“Law”); or
(c) require any consent or approval of any person, including any registration or
filing with, or notice to any federal, state or local governmental authority or
any agency or instrumentality thereof (a “Governmental Authority”).

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SUBSCRIBER
The Subscriber, severally as to itself only and not jointly as to or with anyone
else, hereby represents and warrants to the Parent as follows:
Section 3.1    Authority and Enforceability. The Subscriber has full power and
authority to enter into this Agreement, the execution and delivery of which has
been duly authorized and this Agreement constitutes a valid and legally binding
obligation of the Subscriber, except as may be limited by bankruptcy,
reorganization, insolvency, moratorium and similar laws of general application
relating to or affecting the enforcement of rights of creditors, and except as
enforceability of the obligations hereunder are subject to general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or law).
Section 3.2    Legends. The Subscriber understands and agrees that the
certificates for the Shares, if any, shall bear substantially the following
legend until such Shares shall have been registered under the Securities Act of
1933, as amended (the “Securities Act”) and effectively disposed of in
accordance with a registration statement that has been declared

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effective, and that the Parent has no intention of registering such Shares
pursuant to the Securities Act:
THE SHARES REPRESENTED BY THIS [CERTIFICATE/STATEMENT] ARE RESTRICTED FROM SALE,
TRANSFER, EXCHANGE OR ASSIGNMENT, EXCEPT PURSUANT TO A REGISTRATION STATEMENT
EFFECTIVE UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (I) TO THE PARENT,
(II) BY THE LAWS OF DESCENT AND DISTRIBUTION, OR (III) UPON RECEIPT OF A WRITTEN
OPINION OF COUNSEL TO THE PARENT OR THE PARENT’S SECRETARY AND GENERAL COUNSEL.
Section 3.3    No Conflict; Required Filings and Consents. The execution,
delivery and performance by the Subscriber of this Agreement and the
consummation by the Subscriber of the transactions contemplated hereby do not
and will not (a) violate any Law, or (b) require any consent or approval of any
person, including any registration or filing with, or notice to any Governmental
Authority.
Section 3.4    Resale; Accredited Investor. The Subscriber is acquiring the
Shares solely for the Subscriber’s own beneficial account, for investment
purposes, and not with a view towards, or resale in connection with, any
distribution of the Shares. The Subscriber is an “accredited investor” as
defined in Rule 501(a) under the Securities Act, and a sophisticated purchaser
who has made its own independent investigation, review and analysis of the
transactions contemplated hereby. The Subscriber has been furnished with all
information (or provided access to all information) regarding the attributes of
the Shares for which it is subscribing and the merits and risks of an investment
in such Shares that it requested to evaluate the investment in such Shares. The
Subscriber is relying solely on the representations, warranties and agreements
of the Parent contained in this Agreement, and agrees that at no time was it
presented with or solicited by or through any leaflet, public promotional
meeting, television advertisement or any other form of general or public
advertising or solicitation.
ARTICLE IV
GENERAL PROVISIONS
Section 4.1    Amendment and Modification. This Agreement may not be amended,
modified or supplemented in any manner, whether by course of conduct or
otherwise, except by an instrument in writing specifically designated as an
amendment hereto, signed on behalf of each party.
Section 4.2    Waiver. No failure or delay of either party in exercising any
right or remedy hereunder shall operate as a waiver thereof. Any such waiver by
a party shall be valid only if set forth in writing by such party.
Section 4.3    Notices. All notices and other communications hereunder shall be
in writing and shall be deemed duly given if delivered personally or sent by
facsimile, e‑mail, overnight courier or registered or certified mail, postage
prepaid, to the address set forth on the signature pages hereto opposite the
party to receive such notice, or to such other address as may be designated in
writing by such party.
Section 4.4    Entire Agreement. This Agreement, together with the Plan,
constitute the entire agreement, and supersedes all prior written agreements,
arrangements and

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understandings and all prior and contemporaneous oral agreements, arrangements
and understandings between the parties with respect to the subject matter of
this Agreement. No party to this Agreement shall have any legal obligation to
enter into the transactions contemplated hereby unless and until this Agreement
shall have been executed and delivered by each of the parties.
Section 4.5    Third-Party Beneficiaries. Nothing in this Agreement shall confer
upon any person other than the parties and their respective successors and
permitted assigns any right of any nature.
Section 4.6    Governing Law. This Agreement and all disputes or controversies
arising out of or relating to this Agreement or the transactions contemplated
hereby shall be governed by, and construed in accordance with, the internal laws
of the State of Delaware, without regard to the laws of any other jurisdiction
that might be applied because of the conflicts of laws principles of the State
of Delaware.
Section 4.7    Award Subject to Plan; Administration. This Agreement is and
shall be construed as an “Other Stock-Based Award” granted to Subscriber
pursuant to the Plan (as such term is defined therein). The Remuneration and
Nominating Committee of the Board of Directors of Coty, Inc. (the “Committee”)
administers the Plan and shall administer this Agreement as an award under the
Plan. The Subscriber’s rights under this Agreement are expressly subject to the
terms and conditions of the Plan, including any guidelines the Committee adopts
from time to time. The Subscriber hereby acknowledges receipt of a copy of the
Plan.
Section 4.8    Submission to Jurisdiction. Each of the parties irrevocably
agrees that any legal action or proceeding arising out of or relating to this
Agreement or for recognition and enforcement of any judgment in respect hereof
brought by the other party or its successors or assigns may be brought and
determined in any New York State or federal court sitting in the Borough of
Manhattan in The City of New York (or, if such court lacks subject matter
jurisdiction, in any appropriate New York State or federal court), and each of
the parties hereby irrevocably submits to the exclusive jurisdiction of the
aforesaid courts for itself and with respect to its property, generally and
unconditionally, with regard to any such action or proceeding arising out of or
relating to this Agreement and the transactions contemplated hereby (and agrees
not to commence any action, suit or proceeding relating thereto except in such
courts). Each of the parties further agrees to accept service of process in any
manner permitted by such courts. Each of the parties hereby irrevocably and
unconditionally waives, and agrees not to assert, by way of motion or as a
defense, counterclaim or otherwise, in any action or proceeding arising out of
or relating to this Agreement or the transactions contemplated hereby, (a) any
claim that it is not personally subject to the jurisdiction of the above-named
courts for any reason other than the failure lawfully to serve process, (b) that
it or its property is exempt or immune from jurisdiction of any such court or
from any legal process commenced in such courts (whether through service of
notice, attachment prior to judgment, attachment in aid of execution of
judgment, execution of judgment or otherwise) and (c) to the fullest extent
permitted by law, that (i) the suit, action or proceeding in any such court is
brought in an inconvenient forum, (ii) the venue of such suit, action or
proceeding is improper or (iii) this Agreement, or the subject matter hereof,
may not be enforced in or by such courts.
Section 4.9    Assignment; Successors. This Agreement may not be assigned by
either party without the prior written consent of the other party, except that
the Parent may assign this Agreement to any of its Affiliates. Subject to the
preceding sentence, this Agreement will be binding upon the parties and their
respective successors and assigns. For

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the purposes of this Agreement, the term “Affiliate” shall mean any entity
controlling, controlled by or under common control with the named party.
Section 4.10    Severability. If any provision or portion of any provision of
this Agreement is held to be invalid, illegal or unenforceable in any respect
under any applicable Law, such invalidity, illegality or unenforceability shall
not affect any other provision hereof.
Section 4.11    Counterparts. This Agreement may be executed in counterparts,
including electronic transmission and facsimile counterparts, all of which shall
be considered one and the same instrument and shall become effective when one or
more counterparts have been signed by each of the parties and delivered to the
other party.
[The remainder of this page is intentionally left blank.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date first written above by their respective officers thereunto duly
authorized.
COTY INC.
Address for Notices:
By:
/s/Michelle Garcia
 
Name:
Michelle Garcia
 
Title:
SVP Corporate & Assistant Secretary
SUBSCRIBER
Address for Notices:
By:
/s/Sébastien Froidefond
 
Name:
Sébastien Froidefond
 

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Annex A
Section 1.    Definitions.
(a)    “Allocable Portion” shall mean, with respect to an Executive, the product
of (i) the aggregate number of shares of Series A Preferred Stock held by such
Initial Executive Holder and his Permitted Holders, and (ii) a fraction (A) the
numerator of which equals the Minimum Number of Shares minus the number of
shares of Class A Common Stock (or Related Common Stock, if any) held by
Executive and his Executive Affiliates on the Share Ownership Cure Date, and (B)
the denominator of which equals the Minimum Number of Shares, provided that if
the number of shares of Class A Common Stock (or Related Common Stock, if any)
held by Executive and his Executive Affiliates on the Share Ownership Cure Date
is fewer than 60% of the Minimum Number of Shares, the Allocable Portion shall
be 100% of the Series A Preferred Stock held by such Initial Executive Holder
and his Permitted Holders.
(b)    “Business Day” shall have the meaning ascribed to such term under the
Plan.
(c)    “Cash Exchange Price” has the meaning set forth in Section 2(b)(1).
(d)    “Cause” shall have the meaning ascribed to such term under the Plan.
(e)    “Change in Control” shall have the meaning ascribed to such term under
the Plan
(f)    “Closing Price” means, with respect to any date, the closing sale price
per share or other security (or if no closing sale price is reported, the
average of the bid and ask prices or, if more than one in either case, the
average of the average bid and the average ask prices) on that date as reported
in composite transactions for the principal Exchange on which such share or
other security is listed or admitted for trading or, if such share or other
security is not listed or admitted for trading on a U.S. national or regional
securities exchange, as reported on the quotation system on which such share or
other security is quoted. If the share or other security is not listed or
admitted for trading on a U.S. national or regional securities exchange and not
reported on a quotation system on the relevant date, the “closing price” will be
the last quoted bid price for such share or other security in the
over-the-counter market on the relevant date as reported by OTC Markets Bureau
or another similar organization. If such share or other security is not so
quoted, the last reported sale price will be the average of the mid-point of the
last bid and ask prices for such share or other security on the relevant date
from each of at least three nationally recognized investment banking firms
selected by the Parent for this purpose.    
(g)    “Disability” shall have the meaning ascribed to such term in the Plan.
(h)    “Disposition Event” has the meaning set forth in Section 2(g)(2).

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(i)    “Employment Agreement” means that agreement by and between Coty UK and
Executive dated June 7, 2016, relating to the terms and conditions of employment
of such Executive, as such agreement may be amended from time to time.
(j)    “Exchange” means The New York Stock Exchange, The NASDAQ Global Market,
or any other U.S. national securities exchange.
(k)    “Exchange Act” shall have the meaning ascribed to such term under the
Plan.
(l)    “Exchange Amount” has the meaning set forth in Section 2(b)(1).
(m)    “Exchange Date” has the meaning set forth in Section 2(d).
(n)    “Exchange Price” has the meaning set forth in Section 2(b)(1).
(o)    “Executive Affiliates” shall mean, with respect to an Executive, (i)
Executive, (ii) his wife, (iii) any business entity in which Executive owns or
controls more than a majority of the economic ownership interests in the equity
of such entity and has the power to elect a majority of directors of such entity
or otherwise has, directly or indirectly, actual control over the business and
operations of such entity, (iv) any beneficiary of the Shareholder Trust other
than Executive and his wife, but solely to the extent such beneficiary receives
a distribution of shares of the Parent’s Class A Common Stock or any Related
Common Stock from the Shareholder Trust and (v) any trust other than the
Shareholder Trust of which Executive and/or his wife is the grantor and the sole
beneficiaries of which are comprised solely of the group consisting of
Executive, his wife and Any Permitted Holder.
(p)    “Good Reason” shall have the meaning ascribed to such term under the
Plan.
(q)    “Fair Market Value” of Class A Common Stock or any other security or
property means the fair market value thereof as determined in good faith by the
Board, which determination must be set forth in a written resolution of the
Board, in accordance with the following rules:
(1)    for Class A Common Stock or other security traded or quoted on an
Exchange, the Fair Market Value will be the average of the Closing Prices of
such security on such Exchange over a ten consecutive trading day period, ending
on the trading day immediately prior to the date of determination; or
(2)    for any security that is not so traded or quoted, or for any other
property, the Fair Market Value shall be determined by the Board (or any duly
authorized committee thereof) in good faith assuming a willing buyer and a
willing seller in an arms’-length transaction.
(r)    “Initial Executive Holder” means an Executive reflected as the holder of
record of shares of Series A Preferred Stock on the original issue date of such
shares on the books and records of the registrar for the Series A Preferred
Stock.

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(s)     “Initial Number of Shares” means 160,513.
(t)     “Majority Shareholder” shall have the meaning ascribed to such term
under the Plan.
(u)    “Mandatory Exchange Date” means, with respect to the Initial Executive
Holder, the date by which a minimum equal to the US Services Vesting Amount must
be exchanged in accordance with Section 2(b), which date shall be the March 1
immediately following the calendar year in which shares of Series A Preferred
Stock issued to such Initial Executive Holder shall first be deemed Vested
Series A Preferred Stock.
(v)    “Minimum Number of Shares” has the meaning set forth in Section 3(c)(2).
(w)    “original issue date” means, with respect to shares of Series A Preferred
Stock, the date of issue of such shares sold to an Initial Executive Holder
pursuant to the terms of such Executive’s Subscription Agreement.
(x)    “Permitted Holder” has the meaning set forth in Section 4(a).
(y)    “Preferred Net Value” has the meaning set forth in Section 2(b)(1).
(z)    “Reference Property” has the meaning set forth in Section 2(g)(2).
(aa)    “Related Common Stock” means any other capital stock into which such
Class A Common Stock may be reclassified or exchanged (other than a change in
par value, or from par value to no par value, or from no par value to par value,
or as a result of a subdivision or combination).
(bb)    “Share Exchange Price” has the meaning set forth in Section 2(b)(1).
(cc)     “US Services Vesting Amount” means (i) the total number of shares of
Vested Series A Preferred Stock held by a holder on the date of determination
multiplied by (ii) the percentage determined by dividing the portion of the
Vested Series A Preferred Stock that is deemed attributable to services
performed within the United States, as determined applying the principles set
forth in U.S. Treasury Regulation §1.861-4(b) (or its successor provision) by
the aggregate amount of Vested Series A Preferred Stock held by such holder.
(dd)    “Vested Series A Preferred Stock” means all shares of Series A Preferred
Stock outstanding and held by a holder on the earliest of (i) the fifth
anniversary of the original issue date (the “Fifth Anniversary”); (ii) the date
the applicable Initial Executive Holder’s employment with Coty UK terminates as
a result of such Initial Executive Holder’s death or Disability; or (iii) the
date of termination of such employment by Coty UK without Cause or by the
Executive for Good Reason within 12 months following a Change in Control
occurring after the first anniversary of the original issue date, provided that
if on the Fifth Anniversary or (if earlier) the date referred to in (ii) or
(iii) above the Initial Executive Holder and his Executive Affiliates have not
made an aggregate investment of at least the Initial Number of

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Shares in Class A Common Stock none of the holder’s Series A Preferred Stock
shall be Vested Series A Preferred Stock.
Other capitalized terms not defined in this Agreement shall have the meanings
ascribed to them under the Plan.
Section 2.    Exchange.
(a)    Generally. The holders of shares of Series A Preferred Stock shall not
have any right to exchange such shares into shares of any other class or series
of securities of the Parent until such time as such shares become Vested Series
A Preferred Stock and then only as provided herein.
(b)    Exchange at the Option of the Holder.
(1)    Subject to Section 2(b)(2), a holder is entitled to exchange, at the
option and election of such holder, any or all Vested Series A Preferred Stock
held by such holder at any time and from time to time by notice given to the
Parent prior to or on the seventh anniversary of the original issue date, into,
at the sole election of the Parent, either: (i) an amount in cash payable in
U.S. dollars per share so exchanged equal to (I) the Fair Market Value of a
share of Class A Common Stock, or Reference Property, as applicable, on the
Exchange Date minus (II) an amount equal to the sum of US$3.50 (the “Cash
Exchange Price”) plus the Fair Market Value of a share of such Class A Common
Stock on the original issue date of such Vested Series A Preferred Stock,
subject to adjustment from time to time as provided herein (the “Share Exchange
Price” and aggregated with the Cash Exchange Price, the “Exchange Price”) (such
difference, the “Preferred Net Value”), or (ii) the number of duly authorized,
validly issued, fully paid and nonassessable shares of Class A Common Stock, or
Reference Property, as applicable, whose aggregate value, as measured by the
Fair Market Value of a share of such Class A Common Stock, or Reference
Property, as applicable, on the Exchange Date, is equal to the Preferred Net
Value (such amount of shares of Class A Common Stock, the “Exchange Amount”).
(2)    The right of a holder to exchange any or all shares of Vested Series A
Preferred Stock as set forth in Section 2(b)(1) shall also expire and lapse, and
be of no further force and effect, on the earliest to occur of: (i) the first
(1st) anniversary of the relevant Initial Executive Holder’s termination of
employment due to death or Disability, and (ii) the latest date prior to which
Vested Series A Preferred Stock can otherwise be exchanged pursuant to Section
2(b)(1).
(c)    Automatic Exchange.
(1)    Notwithstanding Section 2(b), in the event that a holder has not
exercised its exchange right in accordance with Section 2(b) with respect to
such number of shares of Vested Series A Preferred Stock as is subject to the
Mandatory Exchange Date, then such number of shares of such Vested Series A
Preferred Stock as is subject to the Mandatory Exchange Date (reduced by any
shares of Vested Series A Preferred Stock as to which a holder

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has prior to such date exercised its exchange right in accordance with Section
2(b)) shall automatically be exchanged on the Mandatory Exchange Date into, and
such holder shall be entitled to receive within five days following such
Mandatory Exchange Date in exchange therefore, either, at the sole option and
election of the Parent, the Preferred Net Value per share in cash equal to such
shares of Vested Series A Preferred Stock being exchanged on the Mandatory
Exchange Date, or the number of duly authorized, validly issued, fully paid and
nonassessable shares of Class A Common Stock, or Reference Property, as
applicable, whose aggregate value, as measured by the Fair Market Value of a
share of such Class A Common Stock, or Reference Property, as applicable, on the
Exchange Date, is equal to the Preferred Net Value..
(2)    Notwithstanding anything else to the contrary, within 30 Business Days
following the date of a Change in Control, the Parent shall have the right to
exchange, upon notice to a holder, any Vested Series A Preferred Stock into the
Preferred Net Value payable, at the sole option and election of the Parent,
either in cash, Class A Common Stock or Reference Property, as applicable.
(d)    Exchange Date. In order to exchange shares of Vested Series A Preferred
Stock, the holder must surrender such shares (if uncertificated) or the
certificates representing such shares, accompanied by transfer instruments
reasonably satisfactory to the Parent, free of any adverse interest or liens at
the office of the Parent’s transfer agent for the Vested Series A Preferred
Stock (or at the principal office of the Parent, if the Parent serves as its own
transfer agent), together with written notice that such holder elects to
exchange all or such number of shares represented by such certificates as
specified therein. The date of receipt of such certificates, together with such
notice, by the transfer agent or the Parent will be the date of exchange (the
“Exchange Date”).
(e)    Fractional Shares. No fractional shares of Class A Common Stock will be
issued upon exchange of the Vested Series A Preferred Stock. In lieu of
fractional shares, the Parent shall pay cash equal to such fractional amount
multiplied by the Fair Market Value of the Class A Common Stock as of the
Exchange Date. If more than one share of Vested Series A Preferred Stock is
being exchanged at one time by the same holder, then the number of full shares
issuable upon exchange, if so elected by the Parent, will be calculated on the
basis of the aggregate number of shares of Vested Series A Preferred Stock
exchanged by such holder at such time.
(f)    Mechanics of Exchange.
(1)    In the event the Parent elects to exchange Vested Series A Preferred
Stock into shares of Class A Common Stock or Reference Property, as applicable,
in accordance with Section 2(b)(1), as soon as practicable after the Exchange
Date (and in any event within ten (10) Business Days), the Parent shall issue
and deliver to such holder the number of shares of Class A Common Stock or such
amount of Reference Property, as applicable, to which such holder is entitled,
together with a check or cash for payment of fractional shares, if any, in
exchange for such shares (if uncertificated) or for the certificates formerly
representing shares of Vested Series A Preferred Stock being so exchanged. Such

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exchange will be deemed to have been made on the Exchange Date, and the person
entitled to receive the shares of Class A Common Stock or Reference Property, as
applicable, issuable upon such exchange shall be treated for all purposes as the
record holder of such shares of Class A Common Stock, or Reference Property, as
applicable, on such Exchange Date. In case fewer than all the shares represented
by any such certificate are to be exchanged, a new certificate shall be issued
representing the shares not exchanged without cost to the holder thereof, except
for any documentary, stamp or similar issue or transfer tax due because any
certificates for shares of Class A Common Stock or Vested Series A Preferred
Stock are issued in a name other than the name of the exchanging holder. The
Parent shall pay any documentary, stamp or similar issue or transfer tax due on
the issue of Class A Common Stock upon exchange or due upon the issuance of a
new certificate for any shares of Vested Series A Preferred Stock not exchanged
other than any such tax due because shares of Class A Common Stock or a
certificate for shares of Vested Series A Preferred Stock are issued in a name
other than the name of the exchanging holder.
(2)    In the event the Parent elects to exchange Vested Series A Preferred
Stock into cash in accordance with Section 2(b)(1), as soon as practicable after
the Exchange Date (and in any event within ten (10) Business Days), the Parent
shall pay such amount to such holder, to the extent of funds legally available
therefor. Such exchange will be deemed to have been made on the Exchange Date.
(3)    From and after the Exchange Date, the shares of Vested Series A Preferred
Stock to be exchanged on such Exchange Date will no longer be deemed outstanding
and all rights of the holder thereof as a holder of Series A Preferred Stock
(except the right to receive from the Parent the Preferred Net Value in cash or
Class A Common Stock or Reference Property, as applicable, upon exchange,
together with the right to receive any payment in lieu of a fractional share of
Class A Common Stock if payment of the Preferred Net Value is to be made in
Class A Common Stock or Reference Property, as applicable) shall cease and
terminate with respect to such shares; provided, that in the event that a share
of Vested Series A Preferred Stock is not exchanged, such share of Vested Series
A Preferred Stock will remain outstanding and will be entitled to all of the
rights as provided herein. Any shares of Vested Series A Preferred Stock that
have been exchanged will, after such exchange, upon issuance of the shares of
Class A Common Stock or Reference Property, as applicable, issuable upon
exchange thereof and cash in lieu of fractional shares of Class A Common Stock
or Reference Property, as applicable, or payment of cash in the amount of the
Preferred Net Value, be deemed cancelled and retired as set forth in Section 14
of the Certificate of Designations.
(4)    The Parent shall comply with all federal and state laws, rules and
regulations and applicable rules and regulations of the Exchange on which shares
of the Class A Common Stock or Reference Property, as applicable, are then
listed. Notwithstanding the other terms contained herein, the Parent shall not
be required to exchange any Vested Series A Preferred Stock into any Class A
Common Stock or Reference Property, as applicable, or issue or deliver the same,
to the extent such exchange, issuance or delivery would require: (i)
registration with or approval of any person under any federal or state law
before such shares

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may be validly issued or delivered upon exchange, (ii) approval from the
Exchange on which shares of the Class A Common Stock or Reference Property, as
applicable, are then listed (the “Relevant Exchange”), unless such approval has
been received, or (iii) approval by the Parent’s stockholders pursuant to the
rules or regulations of the Relevant Exchange, unless such approval has been
received.
(5)    All shares of Class A Common Stock or other securities of the Parent
issued upon exchange of the shares of Vested Series A Preferred Stock will, upon
issuance by the Parent, be duly and validly issued, fully paid and
nonassessable, not issued in violation of any preemptive rights arising under
law or contract and free from all taxes, liens and charges with respect to the
issuance thereof, and the Parent shall take no action which will cause a
contrary result.
(g)    Adjustments to Exchange Price.
(1)    Adjustment for Change In Capital Stock.
(i)
If the Parent shall, at any time and from time to time while any shares of
Series A Preferred Stock are outstanding, issue a dividend or make a
distribution on its Class A Common Stock payable in shares of Class A Common
Stock to all or substantially all holders of its Class A Common Stock, then each
of the Share Exchange Price and the Cash Exchange Price will be adjusted by
multiplying each by a fraction:

I
the numerator of which shall be the number of shares of Class A Common Stock
outstanding at the close of business on the Business Day immediately preceding
the applicable dividend or distribution date; and

II
the denominator of which shall be the sum of the number of shares of Class A
Common Stock outstanding at the close of business on the Business Day
immediately preceding the applicable dividend or distribution date, plus the
total number of shares of Class A Common Stock constituting such dividend or
other distribution.

(ii)
If the Parent shall, at any time or from time to time while any shares of Series
A Preferred Stock are outstanding, subdivide or reclassify its outstanding
shares of Class A Common Stock into a greater number of shares of Class A Common
Stock, then each of the Share Exchange Price and the Cash Exchange Price in
effect at the opening of business on the day upon which such subdivision becomes
effective shall be proportionately decreased, and conversely, if the Parent
shall, at any time or from time to time while any shares of Series A Preferred
Stock are outstanding, combine or reclassify its outstanding shares of Class A
Common Stock in to a smaller number of shares of Class A Common

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Stock, then each of the Share Exchange Price and the Cash Exchange Price in
effect at the opening of business on the day upon which such combination or
reclassification becomes effective shall be proportionately increased. In each
such case, each of the Share Exchange Price and the Cash Exchange Price shall be
adjusted by multiplying each such Share Exchange Price and Cash Exchange Price
by a fraction, the numerator of which shall be the number of shares of Class A
Common Stock outstanding immediately prior to such subdivision or combination
and the denominator of which shall be the number of shares of Class A Common
Stock outstanding immediately after giving effect to such subdivision,
combination or reclassification. Such increase or reduction, as the case may be,
shall become effective immediately after the opening of business on the day upon
which such subdivision, combination or reclassification becomes effective.
(2)    Disposition Events. Subject to Section 2(c)(2), if any of the following
events occurs (other than (i) any stock split or combination to which
Section 2(g)(1) is applicable or (ii) a liquidation, dissolution, winding up or
other transaction to which “Section 5. Liquidation” of the Certificate of
Designations is applicable) (any such event, a “Disposition Event”):
(i)
any reclassification or exchange of the Class A Common Stock (other than a
change in par value, or from par value to no par value, or from no par value to
par value, or as a result of a subdivision or combination);

(ii)
any merger, consolidation or other combination to which the Parent is a
constituent party;

(iii)
any sale, conveyance, lease, or other disposal of all or substantially all the
properties and assets of the Parent to any other person; or

(iv)
the payment of an extraordinary cash dividend which would be treated as a
“corporate transaction” within the meaning of the regulations promulgated under
Section 424(a) of the U.S. Internal Revenue Code (or any successor provision);
and

in each case, as a result of which event, all of the holders of Class A Common
Stock shall be entitled to receive cash, securities or other property for their
shares of Class A Common Stock, the Parent or the successor or purchasing
person, as the case may be, shall provide that any Vested Series A Preferred
Stock exchanged following the effective date of any Disposition Event, may be
exchanged, in lieu of the Class A Common Stock that the Parent otherwise had the
option of delivering in lieu of cash upon exchange of Vested Series A Preferred
Stock, into the same amount and type (in the same proportion) of cash,
securities or other property (collectively, “Reference Property”) received upon
the occurrence of such Disposition Event by a holder of Class A Common Stock,
with the amount of such Reference Property to be received for each share of
Vested Series A Preferred Stock determined based upon the

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Exchange Amount in effect immediately prior to such Disposition Event; provided
that if the Disposition Event provides the holders of Class A Common Stock with
the right to receive more than a single type of consideration determined based
in part upon any form of stockholder election, the Reference Property shall be
comprised of the weighted average of the types and amounts of consideration
received by the holders of the Class A Common Stock.
(3)    Minimum Adjustment. Notwithstanding the foregoing, the Exchange Price
will not be adjusted if the amount of such adjustment would be an amount less
than $0.01, but any such amount will be carried forward and adjustment with
respect thereto will be made at the time that such amount, together with any
subsequent amounts so carried forward, aggregates to $0.01 or more.
(4)    Rules of Calculation; Treasury Stock. All calculations will be made to
the nearest one-hundredth of a cent or to the nearest one-ten thousandth of a
share. Except as explicitly provided herein, the number of shares of Class A
Common Stock outstanding will be calculated on the basis of the number of issued
and outstanding shares of Class A Common Stock, not including shares held in the
treasury of the Parent. The Parent shall not pay any dividend on or make any
distribution to shares of Class A Common Stock held in treasury.
(5)    Par Value. Anything in this Section 2 notwithstanding, no adjustment to
the Exchange Price shall reduce the Exchange Price below the then par value per
share of Class A Common Stock, and any such purported adjustment shall instead
reduce the Exchange Price to such par value.
(6)    No Duplication. If any action would require adjustment of the Exchange
Price pursuant to more than one of the provisions described in this Section 2 in
a manner such that such adjustments are duplicative, only one adjustment shall
be made.
(h)    Notice of Record Date. In the event of:
(1)    any stock split or combination of the outstanding shares of Class A
Common Stock;
(2)    any declaration or making of a dividend or other distribution to holders
of Class A Common Stock in additional shares of Class A Common Stock, any other
capital stock, other securities or other property (including but not limited to
cash and evidences of indebtedness);
(3)    any reclassification or change to which Section 2(g)(1)(ii) applies;
(4)    the dissolution, liquidation or winding up of the Parent;
(5)    any other event constituting a Change in Control; or
(6)    any other event that would cause or allow for the exchange of any Vested
Series A Preferred Stock in accordance with this Section 2,

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then the Parent shall send to the holders of the Vested Series A Preferred
Stock, which notice will be deemed effective if sent to their last addresses as
shown on the records of the Parent, at least 10 days prior to the record date
specified in (i) below or 10 days prior to the date specified in (ii) below, a
notice stating:
(i)
the record date of such stock split, combination, dividend or other
distribution, or, if a record is not to be taken, the date as of which the
holders of Class A Common Stock of record to be entitled to such stock split,
combination, dividend or other distribution are to be determined, or

(ii)
the date on which such reclassification, change, dissolution, liquidation,
winding up or other event constituting a Change in Control any other event that
would cause or allow for the exchange of any Vested Series A Preferred Stock in
accordance with this Section 2 is estimated to become effective, and the date as
of which it is expected that holders of Class A Common Stock of record will be
entitled to exchange their shares of Class A Common Stock for the capital stock,
other securities or other property (including but not limited to cash and
evidences of indebtedness) deliverable upon such reclassification, change,
liquidation, dissolution, winding up or other Change in Control.

No failure to provide such notice will affect the validity of any such actions.
(i)    Certificate of Adjustments. Upon the occurrence of each adjustment or
readjustment of the Exchange Price pursuant to this Section 2, the Parent shall
promptly as reasonably practicable compute such adjustment or readjustment in
accordance with the terms of the Subscription Agreement and furnish to each
holder of Vested Series A Preferred Stock a certificate, signed by an officer of
the Parent, setting forth such adjustment or readjustment and showing in detail
the facts upon which such adjustment or readjustment is based and shall file a
copy of such certificate with its corporate records. The Parent shall, upon the
reasonable written request of any holder of Vested Series A Preferred Stock,
furnish to such holder a similar certificate setting forth (i) the calculation
of such adjustments and readjustments in reasonable detail, (ii) the Exchange
Price then in effect, and (iii) the number of shares of Class A Common Stock and
the amount, if any, of capital stock, other securities or other property
(including but not limited to cash and evidences of indebtedness) which then
would be received upon the exchange of Vested Series A Preferred Stock.
Section 3.    Redemption at the Option of the Parent.
(a)    In Whole Upon Maturity, Death or Disability. To the extent then still
outstanding, the Parent shall have the right to redeem all, but not less than
all, shares of Series A Preferred Stock at a redemption price equal to $0.01 per
share, at the earliest of (i) on or after latest date prior to which Vested
Series A Preferred Stock may be exchanged pursuant

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to Section 2(b)(1), and (ii) on or after the first (1st) anniversary following
the termination of the relevant Initial Executive Holder’s employment due to
death or Disability.
(b)    In Whole or in Part Upon Certain Other Events.
(1)    In the event that the employment of the relevant Initial Executive Holder
by Coty UK shall terminate for any reason other than death or Disability of such
Initial Executive Holder prior to the fifth (5th) anniversary of the original
issue date with respect to the shares of Series A Preferred Stock issued to him
in accordance with the terms of the Subscription Agreement, the Parent shall
have the right to redeem all, or any portion of, the shares of Series A
Preferred Stock held by the holder at a redemption price per share of Series A
Preferred Stock equal to the lesser of (i) the purchase price per share paid by
the Initial Executive Holder for such Series A Preferred Stock in accordance
with the terms of the Subscription Agreement and (ii) the then fair market value
per share of such Series A Preferred Stock, as determined at or about the date
of redemption by an independent qualified professional appraisal firm selected
by the Board, whose determination of the fair market value per share of such
Series A Preferred Stock will be conclusive and binding for all purposes
hereunder.
(2)    The right of the Parent to redeem any shares of Series A Preferred Stock
set forth in Section 3(b)(1) shall expire and lapse, and be of no force or
effect, if the relevant Initial Executive Holder’s employment is terminated by
Coty UK without “Cause” or by the Executive for Good Reason within 12 months
following any Change in Control occurring after the first anniversary of the
original issue date with respect to the shares of Series A Preferred Stock
issued to him.
(c)    Partial Redemption.
(1)    Within ten (10) Business Days after the original issue date with respect
to his shares of Series A Preferred Stock, an Executive shall, and shall use
reasonable best commercial efforts to cause any Executive Affiliate to, notify
the Corporation in writing of the number of shares of Class A Common Stock held
of record by such persons or entities, if any. Such Executive shall, and shall
use his reasonable best commercial efforts to cause any Executive Affiliate to,
notify the Corporation promptly in writing, and in any event within ten (10)
Business Days, of any changes in such entity’s or person’s holdings, whether
direct, beneficial or otherwise, in respect of Class A Common Stock or Related
Common Stock, if any. If any Executive Affiliate fails to provide such notice on
a timely basis, the Corporation shall so notify Executive, and Executive shall,
within five (5) Business Days of receipt of such notice from the Corporation,
provide the Corporation with any information that the Executive knows, should
know or reasonably believes to be true, regarding the holdings of such Executive
Affiliate.
(2)    If, at any time from the first 10 November following the original issue
date with respect to his shares of Series A Preferred Stock and prior to the
date that the right of the Corporation to redeem shares of Series A Preferred
Stock expires and

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lapses in accordance with Section 3(b)(2), the Executive and such Executive’s
Executive Affiliates shall, in the aggregate, hold a number of shares of Class A
Common Stock or, if applicable, Related Common Stock, which is less than the
Initial Number of Shares (collectively, the “Minimum Number of Shares”), and
Executive and Executive Affiliates do not, in the aggregate, acquire sufficient
additional shares of Class A Common Stock or Related Common Stock, as
applicable, to restore their aggregate ownership of Class A Common Stock and
Related Common Stock, as applicable, to at least the Minimum Number of Shares
within 120 calendar days (the “Share Ownership Cure Date”) after the initial
date on which less than the Minimum Number of Shares was collectively held, as
reported pursuant to Section 3(c)(1) or as otherwise known to the Corporation,
then the Corporation shall have the option to redeem up to the Allocable Portion
at a redemption price equal to $0.01 per share of Series A Preferred Stock.
(3)    In case of any redemption in accordance with this Section 3(c), the
shares of Series A Preferred Stock to be redeemed shall be selected either pro
rata, by lot or in such other manner as the Corporation may determine to be
equitable.

Section 4.    Restrictions on Transfer.
(a)    An Initial Executive Holder shall not be entitled to sell, offer to sell,
contract or agree to sell, hypothecate, pledge, grant any option to purchase or
otherwise dispose of or agree to dispose of, directly or indirectly, any shares
of Series A Preferred Stock, except that such Initial Executive Holder may
transfer shares of Series A Preferred Stock to any “family members”, as such
term is defined on Form S-8 promulgated by the U.S. Securities and Exchange
Commission under the U.S. Securities Act of 1933, as amended, as such form may
be amended from time to time (such persons, such Executive’s “Permitted
Holders”).
(b)    Following any permitted transfer under Section 4(a), shares of Series A
Preferred Stock held by a Permitted Holder, if any, shall remain subject to the
same rights, privileges, limitations and conditions relating to such shares of
Series A Preferred Stock as set forth herein that would otherwise have applied
had the Initial Executive Holder continued to hold such shares of Series A
Preferred Stock, including, without limitation, those transfer restrictions set
forth in Section 4(a).
Section 5.    Information.
(a)    Within ten (10) Business Days after the original issue date with respect
to his shares of Series A Preferred Stock, the Initial Executive Holder shall,
and shall use reasonable best commercial efforts to cause any Executive
Affiliate to, notify the Parent in writing of the number of shares of Class A
Common Stock held of record by such persons or entities, if any, and the amount
paid for such shares. Such Initial Executive Holder shall notify the Parent
promptly in writing, and in any event within ten (10) Business Days, of any
changes in such Initial Executive Holder’s or any Executive Affiliate’s
holdings, whether direct, beneficial or otherwise, in respect of Class A Common
Stock or Related Common Stock, if any.

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(b)    Mechanics of Redemption. If any shares of Series A Preferred Stock are to
be redeemed in accordance with this Section 5, the notice of redemption shall be
given by first class mail to the holders of record of Series A Preferred Stock
to be redeemed, mailed not less than 15 days nor more than 30 days prior to the
date fixed for redemption thereof. Each notice of redemption will include a
statement setting forth: (1) the redemption date; (2) the number of shares of
Series A Preferred Stock to be redeemed and, if less than all the shares held by
such holder are to be redeemed, the number of such shares to be redeemed from
such holder; (3) the redemption price; (4) the place or places where the
certificates evidencing shares of Series A Preferred Stock are to be surrendered
for payment of the redemption price; and (5) that the Parent may withdraw its
notice of redemption with respect to all or a portion of the shares of Series A
Preferred Stock to be redeemed at any time prior to 5:00 p.m. (New York City
time) on the Business Day immediately preceding an applicable redemption date.
On and after any redemption date, any such shares of Series A Preferred Stock so
redeemed shall no longer be deemed outstanding and all rights of the holders of
such shares will terminate, except the right to receive the redemption price, if
any.

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