| Item 1.01. | Entry into a Material Definitive Agreement. |
3.875% Senior secured Notes due 2026
On June 16, 2021, Coty Inc. (the “Company” or “Coty”) completed its previously announced offering of 3.875% senior secured notes in an aggregate principal amount of €700 million (the “Notes”) in a private offering.
The Notes are senior secured obligations of Coty and are guaranteed on a senior secured basis by each of Coty’s wholly owned domestic subsidiaries that guarantees Coty’s obligations under its existing senior secured credit facilities and existing secured notes and are secured by first priority liens on the same collateral that secures Coty’s obligations under its existing senior secured credit facilities and existing secured notes. The Notes and the guarantees are equal in right of payment with all of Coty’s and the guarantors’ respective existing and future senior indebtedness (including Coty’s existing senior notes and senior secured credit facilities) and are pari passu with all of Coty’s and the guarantors’ respective existing and future indebtedness that is secured by a first priority lien on the collateral, including the existing senior secured credit facilities and existing secured notes, to the extent of the value of such collateral.
The Notes and related guarantees were offered and sold in a private offering that was exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The Notes and related guarantees were offered within the United States only to persons reasonably believed to be qualified institutional buyers in accordance with Rule 144A under the Securities Act and outside the United States only to non-U.S. investors in accordance with Regulation S under the Securities Act. The Notes and related guarantees have not been registered under the Securities Act or the securities laws of any other jurisdiction. Unless so registered, the Notes and related guarantees may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.
The Indenture
The Notes were issued pursuant to an indenture, dated as of June 16, 2021 (the “Indenture”), among the Company, the Guarantors, Deutsche Bank Trust Company Americas, as trustee (the “Trustee”) and collateral agent and Deutsche Bank AG, London Branch as paying agent. The Notes will accrue interest at the rate of 3.875% per year and will mature on April 15, 2026. Interest on the Notes will be payable semi-annually in arrears on each April 15 and October 15, commencing on October 15, 2021.
The Notes will be redeemable at the option of the Company, in whole or in part, at any time on or prior to April 15, 2023 at 100% of the aggregate principal amount thereof plus a “make-whole” premium and accrued and unpaid interest, if any, to, but excluding, the redemption date.
The redemption price for the Notes that are redeemed on or after April 15, 2023 will be equal to the redemption prices set forth in the Indenture, together with any accrued and unpaid interest to, but excluding, the redemption date.
In addition, the Company may redeem up to 40% of the Notes using the proceeds of certain equity offerings completed before April 15, 2023.
Upon the occurrence of certain change of control triggering events with respect to a series of Notes, the Company will be required to offer to repurchase such Notes at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to, but excluding, the purchase date applicable to such Notes.
The Indenture contains covenants that limit the ability of the Company and any of its restricted subsidiaries to, among other things:
| | • | | incur additional indebtedness, guarantee indebtedness or issue disqualified stock or, in the case of such subsidiaries, preferred stock; |
