DEF 14A of Coty Inc., Sep 21, 2023

DEF 14A of Coty Inc.

Filed Sep 21, 2023 · FY20230001024305-23-000069

Open on EDGAR

  1. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS The Board has fixed the number of directors who will be nominated for election by the shareholders at the 2023 Annual Meeting at eleven, each director to hold office, in accordance with our Amended and Restated Certificate of Incorporation and Bylaws, until the next annual meeting or until his or her successor is duly elected and qualified. During the 2023 fiscal year, Lubomira Rochet was appointed to the Board on January 2, 2023 and Erhard Schoewel resigned from the Board on March 8, 2023. The size of the full Board was increased or decreased appropriately upon each change to the Board’s composition. All nominees are currently serving as directors of the Company were elected by the stockholders. The nominees are Maria Asucion Aramburuzabala Larregui, Beatrice Ballini, Joachim Creus, Oliver Goudet, Peter Harf, Johannes P. Huth, Anna Adeola Makanju Sue Nabi, Isabelle Parize, Lubomira Rochet, and Robert Singer. Proposal: Election of each nominee for director. Recommendation: The Board recommends a vote FOR the election of each nominee for director. Vote Required: Election of each nominee for director requires a plurality of the votes cast by the holder of Class A Common Stock and Series B Preferred Stock (on an as converted basis) voting together.

  2. Director Nominees

    Director Nominees

  3. Director Nominees

    | Name | Age | Director Since | | Mariasun Aramburuzabala Larregui | 60 | 2020 | | Beatrice Ballini | 65 | 2019 | | Joachim Creus | 47 | 2019 | | Olivier Goudet | 58 | 2013 | | Peter Harf | 77 | 1996 | | Johannes P. Huth | 63 | 2020 | | Anna Adeola Makanju | 47 | 2020 | | Sue Nabi | 55 | 2020 | | Isabelle Parize | 66 | 2020 | | Lubomira Rochet | 46 | 2023 | | Robert Singer | 71 | 2010 |

  4. Director Nominees

    We believe that each of the director nominees is well-qualified to serve on our Board and offers significant individual attributes and contributions important to our Board’s overall composition and functioning. The individuals nominated for election at our 2023 Annual Meeting bring valuable diversity to the Board.

  5. Director Nominees

    | Average Age | Gender | Average Tenure | Refreshment | | 60 | 55% | ~ 7 | 55% | | years | | years | | | | 6/11 are women | | 6/11 added in the last 3 years |

  6. Director Nominees

    The following biographical summaries provide details of their skills and experience considered by the Board in connection with this year’s director nomination process: Maria Ausuncion Aramburuzabala Larregui joined the Board in December 2020. Ms. Aramburuzabala is President of the Board & CEO of Tresalia Capital, a leading global investor with investments and transactional experience throughout Latin America, Asia, Europe and the U.S. Tresalia has a particular expertise in consumer goods companies, with an investment portfolio including Anheuser-Busch InBev (ABI), Tory Burch, Kio Networks, Casper, Multiplan, Kraft-Heinz, Aliat, and Medistik, as well as early-stage investments like Kavak, Kovi, Editas, Minu, Miroculus, and GAIA. Ms. Aramburuzabala also serves as a Board Director for several global corporations and institutions, including Anheuser-Busch InBev (ABI) and Grupo Modelo. She is one of Latin America’s most prominent business leaders and her achievements have been recognized by multiple institutions. Ms. Aramburuzabala graduated from Instituto Tecnológico Autónomo de México. Ms. Aramburuzabala Larregui brings to our Board significant leadership, management and business experience. Her extensive work experience in the Americas and Europe provides a valuable global perspective. Beatrice Ballini joined the Board in September 2019 and has served as the Chair of the RNC since May 31, 2020. Until June 30, 2023, Ms. Ballini served as a senior member of the Retail Practice at Russell Reynolds Associates, a global leadership advisory and search firm, where she led family business services and was a leader of the Board and CEO Advisory Partners group. Prior to joining Russell Reynolds Associates 21 years ago, Ms. Ballini was the Chief Executive Officer of a prominent men’s clothing manufacturer in Milan where she assisted with the company’s strategic growth. Prior to that, she held positions at Goldman Sachs & Co. and Bain & Co. Ms. Ballini has also taught in the Master in Marketing program at Sciences Politiques in Paris and is a member of the European and Middle Eastern Executive Board of the MIT Sloan School of Management. She holds a laurea degree in chemical engineering from the Polytechnic of Milan, a Master of Science from the Massachusetts Institute of Technology and an MBA from the MIT Sloan School of Management. Since July 2021, Ms. Ballini is a member of the board of VAM Investments SPAC, BV, a special purpose acquisition company listed on Euronext Amsterdam, where she chairs the audit committee. Ms. Ballini brings to our Board significant leadership, management and business experience and an understanding of executive skill and training and Board governance. Joachim Creus joined the Board in 2019. Mr. Creus has served as a Senior Partner, Vice Chairman at JAB Holding Company S.à r.l. (“JAB Sarl”) since March 2021 and previously served as Partner, General Counsel and Head of Tax at JAB Sarl since October 2010. Mr. Creus has held various executive officer roles at several JAB Group entities from time to time. Prior to joining JAB Sarl, he served as the Tax Director at Siemens from 2007 and held other legal- and tax-related positions from 2000. He is also a director of JDE Peets N.V. Mr. Creus holds several degrees from KU Leuven and an LL.M. in international tax law from Vienna University of Economics and Business. Mr. Creus brings to our Board more than 18 years of experience in managing complex legal and tax matters and transactions in law firm, corporate and fund environments, including deal structuring, financing, contract negotiation and antitrust matters. His extensive work experience in Europe, Asia and North America provides a global perspective on business, tax and law. Olivier Goudet joined the Board in 2013. Mr. Goudet is a Managing Partner and Chief Executive Officer of JAB Sarl, a position he has held since 2012. He serves as Chairman of the Board of JDE Peet’s N.V., Panera Bread Company, Pret A Manger and Krispy Kreme Doughnuts, Inc. He is also a Director of Keurig Dr Pepper Inc. (since July 2018), Caribou Coffee Company, Inc. (being the parent company of Einstein Noah Restaurant Group, Inc.), Espresso House Holding AB and Compassion First. He served as a director of Anheuser-Busch InBev SA/NV from 2011 to April 2019, serving as Chairman of the Board from 2016 to April 2019. He is the former Executive Vice President and Chief Financial Officer of Mars, Incorporated and served as an independent advisor to the Mars, Incorporated Board of Directors. Mr. Goudet began his career at Mars, Incorporated, serving on the finance team of its French business and held several senior executive positions at the VALEO Group, including Group Finance Director. Mr. Goudet holds a Degree in Engineering from l’Ecole Centrale de Paris and graduated from the ESSEC Business School in Paris with a major in Finance. Mr. Goudet brings to our Board extensive financial expertise and senior executive experience, including experience in strategic planning and leadership of complex organizations, as well as significant governance and oversight experience attained through his tenure as a director of several public companies. In addition, Mr. Goudet has significant experience overseeing transformational mergers and integration. Peter Harf joined the Board in 1996 and has served as Chairman of the Board since November 2018. Mr. Harf served as Chief Executive Officer of the Company from 1993 to 2001, as interim Chief Executive Officer from May 31, 2020 to August 31, 2020, as Chairman of the Board from 2001 to 2011 and Chair of the RNC from 2011 until December 2016. He is a Managing Partner and Chairman of JAB Sarl, having joined JAB Sarl in 1981, and Managing Director of Lucresca SE and Agnaten SE, privately-owned holding companies affiliated with JAB Group. Mr. Harf is also a Director of Keurig Dr Pepper Inc. (since July 2018), JDE Peet’s N.V. and Compassion First. He is also co-founder and Executive Chairman of Delete Blood Cancer DKMS. Previously, he served as Deputy Chairman of Reckitt Benckiser plc and Chairman of Anheuser-Busch InBev SA/NV, Chairman of Espresso House Holding AB and Director of Panera Bread Company, Pret A Manger, Caribou Coffee Company/Einstein Noah and Krispy Kreme Doughnuts Inc. Mr. Harf holds a Master of Business Administration degree from Harvard Business School and a Diploma and a Doctorate in Economics from the University of Cologne in Germany. As our former Chief Executive Officer, Mr. Harf has intimate knowledge of our business and operations and brings a valuable perspective to the Board. In addition, Mr. Harf brings to our Board more than 30 years of experience in our industry, including executive, operating, strategic planning and international business experience. In light of his background and experience, we believe that Mr. Harf is also well qualified to serve as Chairman of the Board.

  7. Director Nominees

    Johannes Huth joined the Board in May 2020 and serves as Vice Chairman of the Board and as Lead Independent Director since June 13, 2023. Mr. Huth is a Partner of KKR, an investment firm, and Head of KKR's operations in Europe, the Middle East and Africa. He joined KKR in May 1999 and is also a member of KKR's Management Committee and several of its Investment Committees. Prior to joining KKR, Mr. Huth was a member of the Management Committee of Investcorp and jointly responsible for Investcorp's operations in Europe. From 1986 to 1991, he worked at Salomon Brothers, where he was a Vice President in the Mergers and Acquisitions departments in London and New York. Mr. Huth is a member of the Board of Axel Springer SE, a digital publishing company based in Germany and a member of the Board of Northumbrian Water Limited. He is the President of the Musée des Arts Décoratifs, Paris, trustee of the Städel Museum in Frankfurt, Member of Council and Chairman of the Audit Committee, LSE, and a member of the Global Advisory Board of the University of Chicago Booth School of Business. He is a Visiting Fellow of Oxford University and a Fellow of the Royal Society of Arts. Mr. Huth earned a BSc with Highest Honors from the London School of Economics and an MBA from the University of Chicago. Mr. Huth brings to our Board extensive investment banking, management and leadership experience from his many years at KKR and other investment banking and management firms. His extensive work experience in Europe, the Middle East and Africa provides a valuable global perspective. Anna Adeola Makanju joined the Board in December 2020. Ms. Makanju is a renowned expert in global policy who brings over 15 years of experience across U.S. government and leading private sector companies. Ms. Makanju currently serves as the Head of Public Policy at OpenAI, an artificial intelligence research and deployment company, leading OpenAI’s work with policymakers around the world to advance its mission to ensure that artificial intelligence benefits humanity. From 2018 to 2021, Ms. Makanju served in senior policy positions at Facebook, including as Global Policy Manager for content regulation. Ms. Makanju served as a Special Adviser for Europe and Eurasia to then-Vice President, now President Joseph R. Biden, focusing on policy and engagement strategies with 51 countries, including Russia and Turkey. She has also served as a Senior Adviser to the U.S. Ambassador to the United Nations and as Director for Russia on the U.S. National Security Council. As an attorney, Ms. Makanju practiced international law at Cleary Gottlieb Steen & Hamilton LLP and international criminal tribunals in the Hague. Ms. Makanju serves as a director of Panera Brands Inc. Ms. Makanju received her B.A. from Western Washington University and holds a J.D. with Pro Bono Distinction from Stanford Law School. Ms. Makanju brings to our Board significant policy advisory and legal and regulatory experience, as well as extensive work experience with leading companies in the digital and technology sectors. Sue Nabi joined the Board in September 2020 in connection with her appointment as our Chief Executive Officer. Prior to joining the Company as its Chief Executive Officer, Ms. Nabi was the founder and chief executive officer of the ultra-luxury skincare line, Orveda from 2017. Ms. Nabi began her career at L’Oréal in 1993 and in 2005, she became the Worldwide President of L’Oréal where she helped boost the growth of its makeup brands, and in 2009, she was named the Worldwide President of Lancôme, where she contributed to its revival, including breakthrough product and brand successes, and served until 2013. Ms. Nabi has an Advanced Master’s degree in Marketing Management from ESSEC (Paris Business School) and an engineering degree in Agronomy and Environment. Ms. Nabi brings to our Board her abilities as a global innovator and beauty industry entrepreneur, as well as her 20 years of leadership experience at L’Oreal, including breakthrough product and brand successes, her ability to build and manage diverse, multi-functional global teams and strategic transformations. Isabelle Parize joined the Board in February 2020. Ms. Parize has served as Chief Executive Officer and Chairman of the Board of Directors of DELSEY, SA, a luggage and travel accessories company since September 2018, having served as Chief Executive Officer at DELSEY Paris from November 2018 to July 2021 and then Chairman. Prior to that, she was Chief Executive Officer of Douglas Holding SA, a German fragrance and cosmetics retail company, from 2016 until March 2018 and Chief Executive Officer at Nocibe, a French fragrance and cosmetics retail company, from 2011 to 2016. Ms. Parize is also a director of Carbios, a green biotechnology company focused on plastic recycling, and from 2006 to July 2023 served on the board of Air France-KLM S.A., an airline company, which are both publicly listed outside the United States. Ms. Parize is an MBA graduate from Ecole Superieure de Commerce de Paris. Ms. Parize brings to our Board extensive operational and leadership experience in global beauty and cosmetics businesses as well as international retail and brand execution via omni-channel and digital and strategic turnarounds. She also brings governance and advisory experience from serving on the boards of other public companies. Lubomira Rochet joined our Board of Directors in January 2023. Ms. Rochet is a Partner at JAB Holding Company. Previously, she served as Chief Digital Officer and member of the Executive Committee at L’Oréal for seven years (2014-2021), where she was responsible for transforming the cosmetics company to a “digital-first” business across 35 international beauty brands and 120 markets. Before joining L’Oréal, Ms. Rochet also served in management positions at CapGemini and Microsoft. In 2010, she became Deputy CEO of Valtech, a leading digital marketing agency, where she worked across a variety of sectors, including luxury, fashion and FMCG, to accelerate their digital, data and tech transformation. Ms, Rochet has served as a director of Keurig Dr. Pepper since June 2021, and serves as an independent director of Societe General, a leading European bank. Ms. Rochet has deep expertise in digital marketing, ecommerce, direct-to-consumer selling and the use of data, technology and innovative business models. Ms. Rochet brings to the Board a recognized digital transformation track record, significant knowledge of the beauty industry and unique perspectives on driving growth through digital leadership and consumer engagement.

  8. Director Nominees

    Robert Singer joined the Board in 2010, and currently serves as Chair of the Audit and Finance Committee. From May 31, 2020 to June 13, 2023, he served as Lead Independent Director. From 2006 to 2009 he served as Chief Executive Officer of Barilla Holding S.p.A., an Italian food company, and before that, he served as the President and Chief Operating Officer of Abercrombie and Fitch Co. from 2004 to 2005. He served as Chief Financial Officer of Gucci Group N.V. from 1995 to 2004. Mr. Singer started his career at Coopers & Lybrand in 1977. Mr. Singer also served as a director of Gianni Versace S.p.A. from 2009 to December 2016 and served as a director of Mead Johnson Nutrition from 2009 to June 2017. He has also served as a director and chair of the audit committees of Swarovksi International Holding SA since 2021, Tiffany & Co. from 2012 to 2021, Keurig Dr. Pepper Inc. since July 2018, and Panera Bread Company since September 2017 and provides similar services to certain private companies affiliated with JAB Group. From 2019 to 2022, Mr. Singer served as a member of the board of the private fashion company, Acne Studios, and continues to provide consulting services to the company. Mr. Singer has served as an advisor to the private equity firm IDG Capital, a private equity firm, since November 2018, and served as a senior advisor to CCMP Capital Advisors, LLC from 2011 to January 2016. He also served as a director and Chairman of the audit committee of Jimmy Choo PLC from September 2014 to 2017. He received a Bachelor of Arts Humanities degree from Johns Hopkins University, a Master of Arts degree in Comparative Literature from University of California, Irvine and graduated from New York University with a Master of Science in Accounting. Mr. Singer brings to our Board many years of operating, financial and executive experience, including in the fashion industry. Mr. Singer has significant public company board and audit committee experience and extensive risk management experience.

  9. Director Compensation

    Director Compensation The following summary describes compensation paid to directors in fiscal year 2023.

  10. Non-Employee Directors Compensation for Fiscal Year 2023

    Non-Employee Directors Compensation for Fiscal Year 2023 The following table sets forth compensation information for our non-employee directors in fiscal year 2023.

  11. Non-Employee Directors Compensation for Fiscal Year 2023

    | Name | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2)(3) | Option Awards ($) | Total ($) | | Mariasun Aramburuzabala Larregui | 100,000 | 191,250 | — | 291,250 | | Beatrice Ballini | 130,000 | 191,250 | — | 321,250 | | Joachim Creus | 100,000 | 191,250 | — | 291,250 | | Olivier Goudet | 100,000 | 191,250 | — | 291,250 | | Peter Harf | 250,000 | 344,250 | — | 594,250 | | Johannes Huth | 157,808 | 301,807 | — | 459,615 | | Anna Adeola Makanju | 100,000 | 191,250 | — | 291,250 | | Isabelle Parize | 100,000 | 191,250 | — | 291,250 | | Lubomira Rochet | 49,315 | 107,810 | — | 157,125 | | Erhard Schoewel | 100,000 | 191,250 | — | 291,250 | | Robert Singer | 160,000 | 191,250 | — | 351,250 |

  12. Non-Employee Directors Compensation for Fiscal Year 2023

    | (1) Amounts represent annual cash compensation for service as a director, Chairman, Lead Independent Director or AFC or RNC Chair, as applicable. Amounts are prorated based on the anticipated period of each director’s service during the fiscal year at the time of payment. In November 2022, Mr. Huth was paid a prorated annual cash retainer of $57,808 for service as a director during fiscal 2022 and was granted prorated annual RSU awards for such service. Ms. Rochet served on the Board from January 2, 2023 through the 2023 annual meeting in November 2023. Her prorated annual RSU awards for service through such annual meeting were granted on January 2, 2023. The prorated annual cash retainer for Ms. Rochet in the amount of $49,315 for her fiscal year 2023 service will be paid in November 2023. | | (2) Amounts represent the grant date fair value of RSUs issued to non-employee directors on November 15, 2022 (unless otherwise indicated) calculated in accordance with FASB ASC Topic 718. See Note 24, “Share-Based Compensation Plans” in the notes to our Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended June 30, 2023 for certain assumptions used to calculate the valuation. The RSU award to Mr. Schoewel was made on November 15, 2022, and vested pursuant to the terms of the award agreements. | | (3) Presented below are the aggregate number of shares of Class A Common Stock underlying RSUs held by the non-employee directors as of June 30, 2023: |

  13. Non-Employee Directors Compensation for Fiscal Year 2023

    | Name | Total Number of Shares of Class A Common Stock Underlying RSUs Outstanding as of June 30, 2023 | Total Number of Shares of Class A Common Stock Underlying Stock Options Outstanding as of June 30, 2023 | | Mariasun Aramburuzabala Larregui | 63,287 | — | | Beatrice Ballini | 82,808 | — | | Joachim Creus | 81,547 | — | | Olivier Goudet | 95,000 | — | | Peter Harf | 187,657 | — | | Johannes Huth | 39,452 | — | | Anna Adeola Makanju | 63,287 | — | | Isabelle Parize | 83,468 | — | | Lubomira Rochet | 12,293* | — | | Erhard Schoewel | 0** | — | | Robert Singer | 95,000 | — | | Justine Tan | 0*** | — |

  14. Non-Employee Directors Compensation for Fiscal Year 2023

    | * Ms. Rochet served on the Board from January 2, 2023 through the 2023 annual meeting in November 2023. Her prorated annual RSU awards for service through such annual meeting were granted on January 2, 2023. | | ** Erhard Schowel resigned from the Board on March 8, 2003. Pursuant to the terms of the Coty Inc. Stock Plan for Directors, upon Mr. Schoewel’s departure from the Board, a pro rata portion of the RSUs awarded to Mr. Schoewel was entitled to vest in full and the remainder were forfeited. | | *** Justine Tan resigned from the Board on July 15, 2022. Upon Ms. Tan departure from the Board, a pro rata portion of the RSUs awarded to Ms. Tan that were entitled to vest were forfeited. |

  15. Elements and Design of Executive Compensation

    Elements and Design of Executive Compensation As we continue to successfully execute on the strategy we laid out 3 years ago and implement our comprehensive transformation agenda, we have focused our compensation program for NEOs on long-term incentives in order to align our executives’ interests with stockholder interests and to foster an ownership culture among our Executive Committee members. The RNC believes that this emphasis on equity awards is appropriate as these officers have the greatest role in establishing the Company’s direction and therefore should have the greatest proportion of their compensation aligned with the long-term interests of shareholders. As previously disclosed, the RNC carefully reviewed the compensation packages for our NEOs at the time of their appointments in 2020 and determined to change certain aspects of the standard NEO compensation program in order to incentivize these key executives during a challenging business transformation. Under this redesign, our NEOs are not eligible for the annual cash incentive awards under our Annual Performance Plan (“APP”), which has historically been a key component of the compensation program for our NEOs and is currently applicable only for our senior leaders who are not on the Executive Committee. Our standard NEO compensation program consists of base salary and long-term equity awards under our Equity and Long-Term Incentive Plan, as from time to time amended (“ELTIP”). We also provide certain benefits and perquisites in line with general practice in the country in which the NEO resides and certain payments in lieu of pensions. Variable pay under our ELTIP has been and will continue to be the most significant element of our standard NEO compensation program. Excluding the specific arrangements for Ms. Nabi and Mr. von Bretten, annual salary generally accounts for less than 25% of total annual target compensation. The Company’s fiscal year 2023 standard executive compensation program applicable to the NEOs consisted of the following principal elements:

  16. Elements and Design of Executive Compensation

    | Compensation Element | Method for Establishing its Value | Form of Payment | Who Establishes Objectives and Participation | | Base Salary | Compensation Peer Group analysis, adjusted, as applicable, to reflect merit-based increases. FY23: No individual increases except in countries where it is mandatory. Individual increases may apply in case of a promotion or major retention issues. | Cash | Except with respect to their own compensation, the Chief Human Resources Officer (“CHRO”) and the CEO recommend, subject to RNC review and approval. | | APP: Annual Incentive | FY23: NEOs will not participate in the APP bonus awards as their variable compensation will be comprised entirely of annual equity incentive awards. | | | | ELTIP: Long-Term Incentive | Compensation Peer Group analysis adjusted to reflect the total pool size and subjective review of NEO individual performance. | RSUs. | Except with respect to their own compensation, the CHRO and the CEO recommend target grant levels for each NEO, subject to RNC approval of: (i) target grant levels and (ii) evaluation of performance against target. |

  17. Base Salary and Target Incentive Compensation Determinations

    Base Salary and Target Incentive Compensation Determinations The RNC annually reviews the structure of the Company’s executive compensation program and, within that program, each executive officer’s target total direct compensation, which is comprised of annual base salary and target annual equity-based compensation (long-term incentive). These targets are generally based on a percentage of the NEO’s annual base salary and level and scope of responsibility and are reviewed regularly. Competitive Compensation. Our compensation program for our NEOs is designed to compensate our NEOs competitively to ensure that we attract and retain the right talent to deliver stockholder value. We benchmark our compensation against a peer group of companies that includes companies against whom we compete for key talent (the “Compensation Peer Group”), which is described more fully below. We generally target total direct NEO compensation at or around the median of the Compensation Peer Group and provide the NEOs with the opportunity to earn total direct compensation toward the third quartile of the Compensation Peer Group based on exceptional performance. Annual Salary Determination. We pay base salaries to provide executives with a secure, fixed base of cash compensation in recognition of individual responsibilities and job performance. Consistent with our pay-for-performance philosophy, base salary generally accounts for less than 25% of each NEO’s fiscal year 2023 target total direct compensation, subject to exceptions in the case of specific compensation arrangements designed to address particular circumstances. Salary levels are typically set and reviewed by the RNC annually and in connection with the appointment of a new executive. Salaries and any salary increases are approved by the RNC after a comparative analysis of base salaries for similar positions among the Compensation Peer Group. When determining base salaries, the RNC considers external competitive market conditions in addition to total direct compensation targets and personal performance and internal comparisons. 2023 Decisions Regarding Salary. For the fiscal year 2023 compensation review, the RNC determined to keep at current levels for each of the NEOs except in exceptional cases due to alignment needs. On May 25, 2023, the RNC approved a new compensatory arrangement for Mr. Mercier who has served as Coty’s Chief Financial Officer since February 2021. Under the terms of the new arrangement (which has been reflected in an updated offer letter), Mr. Mercier will be entitled to an annual base salary in the amount of EUR 825,000 effective June 1, 2023 (an increase from his previous annual base salary of EUR 750,000).

  18. Long-Term Incentive Compensation

    Long-Term Incentive Compensation Annual Equity-Based Compensation Awards. We seek to closely align the interests of our NEOs with those of our stockholders through a compensation program in which a significant portion of total compensation is paid through equity-based long-term incentives. We have adopted the ELTIP, which governs all equity awards granted to employees after its adoption in 2013. Long-term equity-based compensation provides direct alignment between our NEOs’and stockholders’ interests. Generally, the RNC determines a target value for annual equity-based awards for each NEO generally based on level, job scope and impact. Typically, these annual awards are made in the form of RSUs, with a three-year graded vesting period, under the ELTIP. The RNC believes this structure helps ensure long-term retention of key executive talent and a longer-term strategic perspective. Our equity compensation programs are intended to encourage retention of, and long-term focus by, our NEOs by giving them an ownership stake in our future growth and financial success. Although we do not tie our long-term incentive awards to specific performance goals, the RSU awards are intended to align the interests of our NEOs with the interests of our shareholders. In particular, as our NEOs are accountable for the successful implementation of our multi-year transformation plan and deleveraging initiatives, as well as the development and execution of our ambitious global business strategy, the RNC considers service-vested equity awards to appropriately incentivize the achievement of long-term business performance goals and sustainable growth. Compensation Arrangements for Named Executive Officers. In fiscal year 2023, the RNC continued to carefully consider the appropriate levels and mix of compensation to establish incentives that are linked to the Company’s goals and align the executives’ interests with those of the stockholders and are also consistent with internal and external competitive comparisons. It also continued implementation of more standardized confidentiality, non-competition, and non-solicitation agreements. Sue Nabi, Chief Executive Officer. The RNC made no changes to Ms. Nabi’s fiscal 2023 compensation arrangements. Ms. Nabi did not receive any grants pursuant to the ELTIP in fiscal 2023. Unique CEO Compensation Arrangements Although the RNC made no changes to Ms. Nabi’s compensation arrangements for fiscal 2023, on May 4, 2023 the Board and Ms. Nabi did enter into an amendment to that certain employment agreement dated as of October 13, 2020, as amended by the amendment (the “Amendment”) to set forth the new compensation arrangements for Ms. Nabi to be effective July 1, 2023. Ms. Nabi’s renewed compensation agreement is anchored on a long-term equity program which runs through 2030. The agreement includes a significant portion of performance related shares alongside a performance related bonus, which are intended to further align all stakeholders’ interests and incentivize strategic growth, recognizing that the Company has now moved from its transformation agenda to a stable strategic platform. Annual Bonus Plan Under the terms of the new fiscal 2024 arrangement, in addition to her annual base salary in the amount of €3,000,000, 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 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. Pursuant to the terms of the Amendment, on May 4, 2023 the Company granted Ms. Nabi a one-time award of 10,416,667 RSUs (the “RSU Award”), which will vest and settle in shares of the Company’s Class A Common Stock over five years on the following vesting schedule: (i) 15% of the RSU Award on September 1, 2024, (ii) 15% of the RSU Award on September 1, 2025, (iii) 20% of the RSU Award on September 1, 2026, (iv) 20% of the RSU Award on September 1, 2027; and (v) 30% of the RSU Award on September 1, 2028, in each case subject to Ms. Nabi’s continued employment through the applicable vesting date. In addition, on May 4, 2023, pursuant to the terms of the new arrangement the Company also granted Ms. Nabi an award of 2,083,333 Performance RSU Awards (the “PRSUs”), which will 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 for an additional annual performance based RSU award of 2,083,333 PRSUs that the Company will grant to Ms. Nabi on or around each of September 1, 2024, September 1, 2025, September 1, 2026, and September 1, 2027, which will 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. Laurent Mercier, Chief Financial Officer. On May 25, 2023, the RNC approved a new compensatory arrangement for Mr. Mercier. Under the terms of the new arrangement, effective June 1, 2023, he is entitled to an an annual base salary in the amount of EUR 825,000 (an increase from his previous annual base salary of EUR 750,000). The RNC made no other changes to Mr. Mercier’s compensation arrangements during fiscal 2023. Ms. Blazewicz, Chief Legal Officer. The RNC made no changes to Ms. Blazewicz’s compensation arrangements during fiscal 2023. Ms. von Bayern, Chief Corporate Affairs Officer. The RNC made no changes to Ms. von Bayern’s compensation arrangements during fiscal 2023. Mr. von Bretten. Chief Transformation Officer. The RNC made no changes to Mr. von Bretten’s compensation arrangements during fiscal 2023.

  19. Fiscal Year 2023 Long-Term Equity Compensation

    Fiscal Year 2023 Long-Term Equity Compensation Annual Awards. The size of the total pool for equity-based awards to our employees as a whole under the ELTIP (including the NEOs) is based on the total number of employees and their target or notional grants for their respective job levels. The RNC determined that the maximum number of RSU awards available for the annual grant in fiscal year 2023 was a total pool valued at $52,600,000, based on the total number of employees and their target or notional grants for their respective job levels. When deciding whether to award annual grants, the RNC considers the collective performance of Coty Inc. during the fiscal year on which the awards are based and, where applicable, an employee’s individual performance in the fiscal year. All annual long-term equity awards granted to our NEOs in fiscal year 2023 were awarded in the form of RSUs with a three-year graded vesting period tied to continued employment with the Company. The applicable vesting timeline for these annual awards (other than awards for Mr. von Bretten) will be 25% after the 1st anniversary, 25% after the 2nd anniversary, and 50% after the 3rd anniversary. The RNC considers several factors when determining long-term incentive awards for each NEO. Notional grants or target awards are established for each role. Then, these target awards may be adjusted based on the RNC’s determination of the total pool size and, in extraordinary circumstances, its review of the NEO’s individual overall performance during the fiscal year. There is no relationship between the timing of the granting of awards and our release of material non-public information. Annual long-term equity awards granted to NEOs under the ELTIP in fiscal year 2023 continued to reflect the unique compensation program designed to incentivize our key executives during a challenging business transformation at the time of their appointments. The annual awards for Mr. Mercier had a target value of $1,800,000 and the annual award for each of Mses. Bayern and Blazewicz and Mr. von Bretten had a target value of $2,900,000. After assessing the individual performance of each NEO, the RNC awarded each NEO his or her full target award. The number of RSUs granted was calculated by dividing the target value by the average Class A Common Stock closing price over the 30-day period prior to the grant date. Pursuant to Mr. von Bretten’s employment agreement, the number of RSUs granted in connection with his annual award was calculated based on the closing price on the grant date. As a result, each of Mr. Mercier and Mses. Bayern and Blazewicz were awarded RSUs covering 253,164, 407,876 and 407,876 shares of Class A Common Stock, respectively, and Mr. von Bretten was awarded 438,066. As discussed above, Ms. Nabi did not receive an equity award under the annual grant pool. The specific awards for the NEOs are shown in the table under the heading “Fiscal Year 2023 Grants of Plan-Based Awards”. When dividends on our Class A Common Stock are paid, dividend equivalent rights are accrued on the RSUs and are paid in cash upon vesting; the Board suspended the payment of dividends on our Class A Common Stock in April 2020.

  20. Additional Executive Compensation Information

    Additional Executive Compensation Information We believe our NEO compensation program follows best practices with respect to corporate governance and risk management, and includes the following principles: Stock ownership and retention guidelines. As described above, we strongly believe in encouraging stock ownership by our NEOs and have adopted stock ownership guidelines that apply to our executives and directors for so long as they serve as executives or directors. These guidelines provide that, after a five-year phase-in period, the Chief Executive Officer and the other members of the Executive Committee should invest in our shares in an amount equal to or exceeding a multiple of five and three times their annual base salary, respectively, and, in the case of our non-employee directors, three times his or her annual cash retainer. If a participant fails to achieve initial compliance within the phase-in period, the RNC may decide that the participant is ineligible to receive equity grants until the guidelines are met. Although the phase-in period has not concluded as of fiscal 2023, a majority of executives and directors subject to these guidelines have achieved initial compliance, and for those who have not, there is no reason to believe that they will not be in compliance. Hedging transactions prohibited. Our insider trading policy prohibits directors, officers and employees from engaging in short sales, derivatives trading and hedging involving our securities. No tax gross-ups. Any personal income taxes due as a result of compensation and/or perquisites, other than reimbursement for children’s schooling fees, are generally the responsibility of the NEOs. We do not provide tax gross-ups for golden parachute excise taxes. Incentives do not encourage excessive risk taking. We believe that our compensation program does not contain features that could potentially encourage excessive risk taking. In addition, we continue to utilize multiple performance measures under the APP applicable to senior leaders other than Executive Committee members to reduce the risk of over concentration on a single business or financial metric. Our stock options, RSUs and other equity granted to our NEOs generally vest over a three-year graded period tied to continued employment with the Company, and management has sizable unvested stock positions relative to their income, which together encourage focus on the long-term value of our stock, aligns management’s and stockholders’ interests and discourages excessive risk taking to optimize short-term and non-sustainable performance. No backdating or repricing of stock options. In fiscal year 2023, the annual equity grants were made in October 2022. Equity awards, including stock options, are never backdated. In addition, our equity incentive plans prohibit repricing of stock options and issuing stock options at below-market exercise prices, unless otherwise approved by our stockholders. Independent external experts engaged for executive compensation information. Each year since fiscal year 2010, the RNC has engaged an independent external expert to provide information with respect to executive compensation. Limited perquisites. NEO perquisites are reasonable and generally represent no more than 3.0% of each NEO’s total target compensation. See “Other Benefits and Perquisites”, below. Double-trigger equity vesting upon a change in control. All active equity compensation plans and programs that provide for additional or accelerated payment or fully accelerated vesting in connection with a change in the control of the Company, including the ELTIP, require a “double-trigger”, which means that accelerated vesting of equity awards issued under the ELTIP will only occur upon a termination of employment in connection with a change in control and not simply as a result of the completion of a change in control transaction. Upon the occurrence of such events, the award vests in full. Claw-Back Policy. Under our Claw-Back Policy, adopted in fiscal 2020, we may recoup incentive compensation paid to an executive officer in the event an accounting restatement occurs as a result of material non-compliance under any financial reporting requirements. If the restated results would have afforded a lower incentive payout, the Board may, in its discretion, seek reimbursement of the difference for the three-year period preceding the restated period. Recoupment can include cancellation of unvested equity awards. We are reviewing our Claw-Back Policy to conform to the new SEC rules for such policies and expect to adopt appropriate amendments in advance of the effective date for NYSE-listed companies.

  21. Competitive Compensation and Peer Group Rationale

    Competitive Compensation and Peer Group Rationale In establishing compensation for our NEOs, we consider the compensation practices, structures and terms (such as the length and nature of applicable vesting periods and the mix of performance-vested and time-vested awards) of the Compensation Peer Group. We consider these practices to determine the competitiveness of individual compensation elements and total compensation of our NEOs. We seek to structure the forms and mix of our executive compensation program in a manner generally consistent with our peers and so that target total direct NEO compensation is at or around the median of the Compensation Peer Group and provides the NEOs the opportunity to earn higher total direct compensation based on exceptional performance in order to attract and retain talent. Individual pay to NEOs varies in accordance with experience, individual and collective performance and other factors determined by the RNC. Actual total direct compensation reported may also vary due to currency fluctuations. The Compensation Peer Group consists of companies that compete directly with us for executive talent and compete with us in the marketplace for business and investment opportunities, as well as global footprint and the complexity of the Company’s strategic, operational and financial transformation. In light of the Company’s ongoing transformation agenda, the RNC believes that comparators based on these characteristics are more meaningful than revenue or market capitalization alone. The RNC periodically reviews the companies included in the Compensation Peer Group, including in consultation with an independent external compensation expert. Our Compensation Peer Group used for compensation decisions early in fiscal year 2023 included the following companies:

  22. Competitive Compensation and Peer Group Rationale

    | Beiersdorf | L’Oreal | | Colgate-Palmolive Company | The Procter and Gamble Company | | The Estée Lauder Company, Inc. | Sephora (a subsidiary of LVMH) | | Henkel AG & Co. KGaA | Ulta Beauty, Inc. | | Johnson & Johnson | Unilever PLC | | LVMH Moet Hennessy - Louis Vuitton SE | |

  23. Competitive Compensation and Peer Group Rationale

    The Compensation Peer Group included companies with a broad range of annual revenues, with a median of approximately $26.3 billion. As a result of the RNC review of the Peer Group in September 2022, Sephora (a private Company) and Ulta Beauty, Inc. have been added to the Peer Group that was used for compensation considerations for the fiscal year ending June 30, 2023, replacing Revlon, Inc. following its delisting from the NYSE.

  24. Employment Agreements

    Employment Agreements We have entered into employment agreements with each of our NEOs. The employment agreements are described in “—Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table—Employment Agreements”.

  25. Independent External Experts Engaged by the Remuneration and Nomination Committee

    Independent External Experts Engaged by the Remuneration and Nomination Committee The RNC has engaged independent external experts to provide information with respect to our executive compensation. The independent external expert reports directly to the RNC, with input from certain members of senior management. All decisions with respect to the amount and form of NEO compensation under our executive compensation programs are made solely by the RNC and may reflect factors and considerations other than the information provided by the independent external expert. In fiscal year 2023, the RNC engaged Willis Towers Watson to provide information regarding competitive compensation peer group and compensation benchmarking data for NEO’s and executive-level positions, as well as information about market practices for equity compensation and plan governance. The RNC assessed the independence of Willis Towers Watson and concluded that Willis Towers Watson is independent and no conflict of interest exists that would prevent Willis Towers Watson from providing this information to the RNC.

  26. Role of “Say-on-Pay” Advisory Vote on Executive Compensation

    Role of “Say-on-Pay” Advisory Vote on Executive Compensation We provided stockholders a “Say-on-Pay” advisory vote on the compensation of our NEOs in 2021 under Section 14A of the Exchange Act. At our 2022 Annual Meeting of Stockholders, approximately 77.8% of the votes cast for approval of the “Say-on-Pay” advisory vote. Our Say on Pay votes have averaged 87.8% support for the last nine years. We believe these results indicate that our shareholders are generally supportive of our compensation program. The RNC carefully evaluated the results of the 2022 advisory vote. The RNC also considers many other factors in evaluating our executive compensation programs as discussed in this CD&A, including the RNC’s assessment of the interaction of our compensation programs with our corporate business objectives, evaluations of our programs by external consultants, and review of peer group and survey data, each of which is evaluated in the context of the RNC’s fiduciary duty to act in stockholders’ best interests. After weighing these factors, the RNC did not make significant changes to our 2023 executive compensation program and policies as a result of the 2022 “Say-on-Pay” advisory vote, and instead we undertook a comprehensive re-assessment of our executive compensation principles for future implementation, with a focus on introducing performance-based metrics for both short-term and long-term incentives for our executive officers. As discussed above in “--Changes to Compensation Philosophy for 2024”, the new compensation arrangement for our CEO, entered into in May of 2023, reflects this approach. It has been our long-standing practice to engage with our stockholders throughout the year so that management and the Board can better understand stockholder perspectives on topics like executive compensation, diversity and sustainability, among others. As reflected in the say-on-pay results, some shareholders have expressed concerns regarding the alignment of pay and performance, targets applicable to our long-term incentive awards, as well as executive severance practices. We were particularly focused on feedback relating to performance-based metrics, and we sought input from stockholders regarding potential structures and metrics, including the use of performance measures linked to “ESG” or other sustainability-related activities. We will continue to reach out to investors and to consider the outcome of say-on-pay votes when making future compensation decisions for our executives and as we implement our 2021 executive compensation program.

  27. Summary Compensation Table

    Summary Compensation Table The following table sets forth information regarding fiscal year 2021, 2022 and 2023 compensation for our NEOs. Columns otherwise required by SEC rules are omitted where there is no amount to report.

  28. Summary Compensation Table

    | Name & Title* | Fiscal Year | Salary ($)(1) | Bonus ($)(1) | Stock Awards ($)(2) | Option Awards ($) | | Non-Equity Incentive Plan Compensation ($)(1) | All Other Compensation ($)(1)(3) | Total Compensation ($)(1) | | Sue Nabi, Chief Executive Officer | 2023 | 3,549,000 | — | 145,875,000 | — | | — | 5,486 | 149,429,486 | | | 2022 | 3,506,260 | — | | — | — | — | 51,494 | 3,557,753 | | | 2021 | 3,549,000 | — | 280,200,000 | — | | — | 42,455 | 283,791,455 | | Laurent Mercier, Chief Financial Officer | 2023 | 790,264 | — | 1,675,946 | — | | — | 117,008 | 2,583,217 | | | 2022 | 603,842 | 340,370 | 1,601,522 | — | | — | 117,445 | 2,663,179 | | | 2021 | 495,982 | 95,583 | 499,999 | — | | — | 74,744 | 1,178,725 | | Kristin Blazewicz, Chief Legal Officer | 2023 | 750,000 | — | 2,700,139 | — | | — | 33,849 | 3,483,988 | | | 2022 | 750,000 | — | 2,665,886 | — | | — | 35,068 | 3,450,954 | | | 2021 | 752,792 | 120,000 | 2,899,997 | — | | — | 55,289 | 3,828,079 | | Anna von Bayern, Chief Corporate Affairs Officer | 2023 | 784,213 | — | 2,700,139 | — | | — | 22,885 | 3,507,237 | | | 2022 | 850,925 | — | 2,665,886 | — | | — | 26,882 | 3,543,693 | | | 2021 | 567,684 | 136,547 | 2,899,997 | — | | — | 13,370 | 3,617,599 | | Gordon von Bretten, Chief Trans-formation Officer | 2023 | 1,342,021 | — | 2,899,997 | — | | — | 62,940 | 4,304,958 | | | 2022 | 1,456,186 | 234,406 | 2,899,996 | — | | — | 73,902 | 4,664,489 | | | 2021 | 1,641,643 | 953,990 | — | — | | — | 72,656 | 2,668,289 |

  29. Summary Compensation Table

    | (1) The salary for each of Messrs. Mercier and von Bretten and Mses. Nabi, Blazewicz and von Bayern reflects the amount of their annual salary paid in fiscal year 2023 during their periods of service to the Company. The salary paid to Mr. Mercier reflects salary increases during the course of the year due to his role as CFO. Mses. Nabi and von Bayern and Messrs. Mercier and von Bretten were paid in Euros. Ms. Blazewicz was paid in U.S. dollars. Exchange rates for fiscal year 2023 compensation are calculated using the average monthly exchange rate during the fiscal year. | | (2) Amounts represent the grant date fair value of the RSUs granted in each year, in each case calculated in accordance with FASB ASC Topic 718. See Note 24, “Share-Based Compensation Plans” in the notes to our Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended June 30, 2023 for certain assumptions used to calculate the valuation. | | (3) Amounts shown in the All Other Compensation column for fiscal year 2023 include the following: (a) For Ms. Nabi, employer contributions to the international healthcare plan for executives in the amount of $5,486; (b) For Mr. Mercier, a mobility allowance in the Netherlands in the amount of $25,094, employer contributions to the international healthcare plan for executives in the amount of $3,577; cash payments in the amount of $59,707 reflecting employer contributions exceeding the Dutch defined contribution plan “annual allowance”; and reimbursement for tax services in the amount of $28,629; (c) For Ms. Blazewicz, employer contributions of $31,317 under the Company’s 401(k) Savings Plan, a defined contribution plan, and reimbursement for tax services in the amount of $2,532; (d) For Ms. von Bayern, a car allowance in the amount of $22,585 and reimbursement for tax services of $300; and (e) For Mr. von Bretten, cash payments in the amount of $56,217 reflecting employer contributions exceeding the Dutch defined contribution plan “annual allowance”; and reimbursement for tax services in the amount of $6,723. |

  30. Fiscal Year 2023 Grants of Plan-Based Awards

    Fiscal Year 2023 Grants of Plan-Based Awards The following table and footnotes provide information on all grants of plan-based compensation under the Company’s plans made to NEOs during fiscal year 2023.

  31. Fiscal Year 2023 Grants of Plan-Based Awards

    | Name | Grant Date | Estimated Future Payments under Non-Equity Incentive Plan Awards (1) ($) | | | All Other Stock Awards: Number of Shares of Stock or Units(2) (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/Sh) | Grant Date Fair Value of Stock and Option Awards ($) | | | | Minimum | Target | Maximum | | | | | | Sue Nabi | 5/4/2023 | — | — | — | 12,500,000 | — | — | 145,875,000 | | Laurent Mercier | 10/19/2022 | — | — | — | 253,164 | — | — | 1,675,946 | | Kristin Blazewicz | 10/19/2022 | — | — | — | 407,876 | — | — | 2,700,139 | | Anna von Bayern | 10/19/2022 | — | — | — | 407,876 | — | — | 2,700,139 | | Gordon von Bretten | 10/19/2022 | — | — | — | 438,066 | — | — | 2,899,997 |

  32. Fiscal Year 2023 Grants of Plan-Based Awards

    | (1) None of the NEOs are eligible for awards under the APP, our annual cash incentive program. | | (2) Represents (a) the annual long-term incentive compensation awards of RSUs under the ELTIP on October 19, 2022, with graded vesting over three years, subject to certain vesting conditions and exceptions; and (b) an award for Ms. Nabi on May 4, 2023 of 10,416,667 RSUs, with graded vesting over five years, subject to certain vesting conditions and exceptions, and an award of 2,083,333 of PRSUs which will 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. Performance objectives for such PRSUs are expected to be determined by the Board in the first quarter of fiscal 2024. See “Compensation Discussion and Analysis — Fiscal Year 2023 Compensation Decisions and Structure — Fiscal Year 2023 Long-Term Equity Compensation”. |

  33. Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table

    Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table Employment Agreements The material terms of each NEO’s current employment arrangements are described below and under “Potential Payments upon Termination or Change-in-Control—Certain Additional Payments”, below: Sue Nabi. Under her employment agreement, Ms. Nabi is our Chief Executive Officer. The employment agreement provides that her base salary, bonus opportunities and long-term incentive awards would be reviewed and set by the Board or a committee thereof. Ms. Nabi is entitled to participate in benefits programs generally made available to similarly-situated senior officers as set forth in her employment agreement. Ms. Nabi did not receive any additional compensation for her service as a director. Ms. Nabi agreed to be bound by certain restrictive covenants for the benefit of the Company, including non-competition and non-solicitation restrictions that will continue in effect for 12 months following her employment with the Company. Laurent Mercier. Under his employment agreement, Mr. Mercier has been our Chief Financial Officer since February 15, 2021. The employment agreement provides that his base salary, bonus opportunities and long-term incentive awards are reviewed and set by the Board or a committee thereof. Mr. Mercier is entitled to participate in benefits programs generally made available to similarly-situated senior officers as set forth in his employment agreement. Mr. Mercier agreed to be bound by certain restrictive covenants for the benefit of the Company, including non-competition and non-solicitation restrictions that will continue in effect for six months following his employment with the Company. Kristin Blazewicz. Under her employment agreement, Ms. Blazewicz is our Chief Legal Officer and General Counsel. The employment agreement provided that her base salary, bonus opportunities and long-term incentive awards would be reviewed and set by the Board or a committee thereof. Ms. Blazewicz is entitled to participate in benefits programs generally made available to similarly-situated senior officers as set forth in her employment agreement. Ms. Blazewicz agreed to be bound by certain restrictive covenants for the benefit of the Company, including non-competition and non-solicitation restrictions that continue in effect for six months following her employment with the Company. Anna von Bayern. Under her employment agreement, Ms. von Bayern is our Chief Corporate Affairs Officer. The employment agreement provided that her base salary, bonus opportunities and long-term incentive awards would be reviewed and set by the Board or a committee thereof. Ms. von Bayern is entitled to participate in benefits programs generally made available to similarly-situated senior officers as set forth in her employment agreement. Ms. von Bayern agreed to be bound by certain restrictive covenants for the benefit of the Company, including non-competition and non-solicitation restrictions that continue in effect for 12 months following her employment with the Company. Gordon von Bretten. Under his employment agreement, Mr. von Bretten is our Chief Transformation Officer. The employment agreement provided that his base salary, bonus opportunities and long-term incentive awards would be reviewed and set by the Board or a committee thereof. Mr. von Bretten was entitled to participate in benefits programs generally made available to similarly-situated senior officers as set forth in his employment agreement. Mr. von Bretten agreed to be bound by certain restrictive covenants for the benefit of the Company, including non-competition and non-solicitation restrictions that continue in effect for 12 months following his employment with the Company. Grants of Plan-Based Awards: Annual Equity Awards Annual equity awards are described and calculated as set forth above in “Compensation Discussion and Analysis—Fiscal Year 2023 Long-Term Equity Compensation”.

  34. Outstanding Equity Awards at 2023 Fiscal Year End

    Outstanding Equity Awards at 2023 Fiscal Year End The following table shows outstanding equity awards held by the NEOs as of June 30, 2023, the last day of our fiscal year. The market value of the shares of unvested RSUs is determined by multiplying the number of outstanding awards by $12.29, which was the closing price of our Class A Common Stock on June 30, 2023, the last trading day of our fiscal year. The market value does not reflect, nor in any way assures, that the amounts will correspond to the actual value that will be recognized by the NEOs upon vesting.

  35. Outstanding Equity Awards at 2023 Fiscal Year End

    | NEO | Option Awards | | | | | Stock Awards | | | | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | | | | | | | | 10,416,667(1) | 128,020,837 | | Sue Nabi | | | | | | 2,083,333(2) | 25,604,163 | | | | | | | | 10,000,000(3) | 122,900,000 | | | | | | | | 253,164(4) | 3,111,386 | | | | | | | | 124,600(5) | 1,531,334 | | Laurent Mercier | | | | | | 51,921(6) | 638,109 | | | | | | | | 10,667(7) | 131,097 | | | | | | | | 4,699(8) | 57,751 | | | | | | | | 407,876(4) | 5,012,796 | | | | | | | | 267,660(5) | 3,289,541 | | Kristin Blazewicz | | | | | | 301,142(6) | 3,701,035 | | | | | | | | 407,876(4) | 5,012,796 | | | | | | | | 267,660(5) | 3,289,541 | | Anna von Bayern | | | | | | 301,142(6) | 3,701,035 | | | | | | | | 438,066(9) | 5,383,831 | | Gordon von Bretten | | | | | | 258,812(10) | 3,180,799 |

  36. Outstanding Equity Awards at 2023 Fiscal Year End

    | (1) Represents RSUs granted under the ELTIP to Ms. Nabi on May 4, 2023 with graded vesting over five years on the following vesting schedule: (i) 15% of the RSU Award on September 1, 2024, (ii) 15% of the RSU Award on September 1, 2025, (iii) 20% of the RSU Award on September 1, 2026, (iv) 20% of the RSU Award on September 1, 2027; and (v) 30% of the RSU Award on September 1, 2028, in each case subject to Ms. Nabi’s continued employment through the applicable vesting date. | | (2) Represents PRSUs granted under the ELTIP to Ms. Nabi on May 4, 2023 that will 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. | | (3) Represents RSUs granted under the ELTIP to Ms. Nabi on June 30, 2020 that vest in three equal installments on August 31, 2021, August 31, 2022 and August 31, 2023, subject to certain vesting conditions. |

  37. Outstanding Equity Awards at 2023 Fiscal Year End

    | (4) Represents RSUs granted under the ELTIP on October 19, 2022, 25% of which on the first anniversary of the date of grant, 25% vest on the second anniversary of the date of grant, and 50% vest on the third anniversary of the date of grant, subject to certain vesting conditions. | | (5) Represents RSUs granted under the ELTIP on November 26, 2021, 25% of which on the first anniversary of the date of grant, 25% vest on the second anniversary of the date of grant, and 50% vest on the third anniversary of the date of grant, subject to certain vesting conditions. | | (6) Represents RSUs granted under the ELTIP on October 19, 2020 that vest in three equal annual installments on the first, second and third anniversary of the grant date, subject to certain vesting conditions. | | (7) Represents RSUs granted under the ELTIP on November 14, 2019 60% of which vest on the third anniversary of the date of grant and 20% of which vest on each of the fourth and fifth anniversaries of the date of grant, subject to certain vesting conditions. | | (8) Represents RSUs granted under the ELTIP on September 4, 2018 60% of which vest on the third anniversary of the date of grant and 20% of which vest on each of the fourth and fifth anniversaries of the date of grant, subject to certain vesting conditions. | | (9) Represents RSUs granted under the ELTIP on October 19, 2021, 25% of which on the first anniversary of the date of grant, 25% vest on the second anniversary of the date of grant, and 50% vest on the third anniversary of the date of grant, subject to certain vesting conditions. | | (10) Represents RSUs granted under the ELTIP on October 19, 2022, that vest in three equal annual installments from the date of grant, subject to Mr. von Bretten’s continued employment through each such vesting date, and certain other restrictions and vesting conditions. | | (11) Represents RSUs granted under the ELTIP on October 19, 2021, that vest in three equal annual installments from the date of grant, subject to Mr. von Bretten’s continued employment through each such vesting date, and certain other restrictions and vesting conditions. |

  38. Fiscal Year 2023 Option Exercises and Stock Vested

    Fiscal Year 2023 Option Exercises and Stock Vested The following table provides information about the NEO’s stock awards that vested during fiscal year 2023. During fiscal year 2023, our NEOs did not exercise any stock options.

  39. Fiscal Year 2023 Option Exercises and Stock Vested

    | | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | | Sue Nabi | 10,000,000 | 75,100,000 | | Laurent Mercier | 117,372 | 798,360 | | Kristin Blazewicz | 390,361 | 2,584,190 | | Anna von Bayern | 390,361 | 2,584,190 | | Gordon von Bretten | 360,391 | 3,471,413 |

  40. Pension Benefits

    Pension Benefits We do not administer any pension programs that provide our NEOs with additional benefits from those offered to our other employees.

  41. Potential Payments upon Termination or Change-in-Control

    Potential Payments upon Termination or Change-in-Control We have entered into employment agreements and related Confidentiality, Non-Competition, and Non-Solicitation Agreements with each of our NEOs, and maintain certain incentive, equity and benefit plans in which our NEOs participate. These agreements and plans provide for certain payments and incremental benefits if an NEO’s employment is terminated under certain circumstances. These payments and benefits are described below. Equity Awards under the ELTIP: RSUs, Restricted Stock, Options, Treatment upon termination due to death, disability or retirement. A pro rata portion of all unvested Stock Options, unvested RSUs, unvested Stock Options or unvested Restricted Stock will vest on a pro rata basis in the event that the NEO’s employment is terminated due to death, disability or retirement. The pro rata amount is based on the number of days that have passed since the applicable award was granted. In the case of awards with the graded vesting schedule discussed above, the pro rata portion of the unvested award will equal the number of unvested RSUs (or other award) that would have become vested at the next scheduled vesting date multiplied by a fraction, the numerator of which is the number of days elapsed from the grant date, or the most recent vesting date, as applicable, to the date employment terminated, and the denominator of which is the number of days between the grant date or the most recent vesting date, as applicable, and the next scheduled vesting date for such portion of the award. Treatment upon termination for any reason other than retirement, death or disability (not following a change in control). All unvested Stock Options and unvested RSUs will be forfeited and canceled pursuant to their terms. Treatment upon a change in control. All active equity compensation plans and programs that provide for additional or accelerated payment or accelerated vesting in connection with a change in the control of the Company, including the ELTIP, require a “double-trigger”. Upon the occurrence of such events, the equity award vests in full. Certain Additional Payments Unless specified below, each NEO would not be entitled to any additional payments upon termination of his or her employment for any reason or a change in control, except for accelerated vesting under the ELTIP. •Ms. Nabi is entitled to six months’ notice of a termination of her employment agreement by the Company, or payment in lieu of such notice in an amount equal to the base salary to which she would have been entitled during the notice period, and monthly payments equal to her base salary for a period of six months in consideration of her non-competition and non-solicitation obligations in the event of the termination of her employment agreement. •Mr. Mercier is entitled to six months’ notice of a termination of his employment agreement by the Company, or payment in lieu of such notice in an amount equal to the base salary to which he would have been entitled during the notice period, and monthly payments equal to his base salary for a period of six months in consideration of his non-competition and non-solicitation obligations in the event of the termination of his employment agreement. •Ms. Blazewicz is entitled to three months’ notice of a termination of her employment agreement by the Company, or payment in lieu of such notice in an amount equal to the base salary to which she would have been entitled during the notice period, monthly payments equal to her base salary for a period of six months in consideration of her non-competition and non-solicitation obligations in the event of the termination of her employment agreement, and a severance payment equal to her base salary for a period of 12 months. •Ms. von Bayern is entitled to six months’ notice of a termination of her employment agreement by the Company, or payment in lieu of such notice in an amount equal to the base salary to which she would have been entitled during the notice period, and monthly payments equal to her base salary for a period of 12 months in consideration of her non-competition and non-solicitation obligations in the event of the termination of her employment agreement. •Mr. von Bretten is entitled to six months’ notice of a termination of his employment agreement by the Company, or payment in lieu of such notice in an amount equal to the base salary to which he would have been entitled during the notice period, and monthly payments equal to his base salary for a period of 12 months in consideration of his non-competition and non-solicitation obligations in the event of the termination of his employment agreement. Effect of Section 409A on Timing of Payments and Equity Awards Any amounts that are not exempt from Section 409A are subject to the required six-month delay in payment after termination of service if the NEO is a “specified employee” for purposes of Section 409A at the time of termination of employment. Amounts that otherwise would have been paid during the six-month delay will be paid in a lump sum on the first day after the delay period expires.

  42. Potential Payments in the Event of Termination of Employment at the End of Our Last Fiscal Year

    Potential Payments in the Event of Termination of Employment at the End of Our Last Fiscal Year The following table sets forth the estimated incremental payments and benefits that would have been received by each NEO if employment had been terminated or upon a change in control on June 30, 2023. Amounts received due to accelerated vesting of equity awards were calculated using the closing price of our Class A Common Stock as of June 30, 2023, the last trading day of the fiscal year, which was $12.29. Exchange rates are calculated using the average monthly exchange rate during the fiscal year.

  43. Potential Payments in the Event of Termination of Employment at the End of Our Last Fiscal Year

    | Name | Resignation with Good Reason | Termination without Cause | Termination for Cause | Resignation without Good Reason | Disability, Retirement or Death | | Change in Control | Resignation with Good Reason or Termination without Cause after Change in Control (1) | | | Sue Nabi(2) | $169,583,244 | $169,583,244 | $— | $— | | 166,034,244 | $— | | 169,583,244 | | Laurent Mercier(3) | $790,748 | $790,748 | $— | $— | | 1,428,786 | $— | | 6,260,424 | | Kristin Blazewicz(4) | $1,312,500 | $1,312,500 | $— | $— | | 5,523,140 | $— | | 13,315,873 | | Anna von Bayern(5) | $1,176,319 | $1,176,319 | $— | $— | | 5,386,959 | $— | | 13,179,691 | | Gordon von Bretten(6) | $2,100,000 | $2,100,000 | $— | $— | | 2,355,587 | $— | | 10,664,631 |

  44. Potential Payments in the Event of Termination of Employment at the End of Our Last Fiscal Year

    | (1) Incremental payments represented in this column do not include any payments reported in the column labeled “Change in Control” that the NEO is entitled to receive pursuant to such change in control. | | (2) Reflects Ms. Nabi’s entitlement, in the event that her employment agreement is terminated, (a) to monthly payments equal to her base salary for a period of 12 months in consideration of her non-competition obligations thereunder; (b) an applicable statutory advance notice period (or payment in lieu thereof) and (c) applicable vesting of her unvested equity awards pursuant to the terms of the awards. | | (3) Reflects Mr. Mercier’s entitlement, in the event that his employment agreement is terminated, (a) to monthly payments equal to his base salary for a period of six months in consideration of his non-competition obligations thereunder; (b) an applicable statutory advance notice period (or payment in lieu thereof) and (c) applicable vesting of his unvested equity awards pursuant to the terms of the awards. | | (4) Reflects Ms. Blazewicz’s entitlement, in the event that her employment agreement is terminated, (a) to monthly payments equal to her base salary for a period of six months in consideration of her non-competition obligations thereunder; (b) a severance payment pursuant to her employment agreement equal to her salary for a period of 12 months; (c) an applicable notice period of three months (or payment in lieu thereof) and (d) applicable vesting of her unvested equity awards pursuant to the terms of the awards. | | (5) Reflects Ms. von Bayern’s entitlement, in the event that her employment agreement is terminated, (a) to monthly payments equal to her base salary for a period of 12 months in consideration of her non-competition obligations thereunder; (b) an applicable statutory advance notice period (or payment in lieu thereof) and (c) applicable vesting of her unvested equity awards pursuant to the terms of the awards. | | (6) Reflects Mr. von Bretten’s entitlement, in the event that his employment agreement is terminated, (a) to monthly payments equal to his base salary for a period of 12 months in consideration of his non-competition obligations thereunder; (b) an applicable statutory advance notice period (or payment in lieu thereof) and (c) applicable vesting of his unvested equity awards pursuant to the terms of the awards. |

  45. Chief Executive Officer Pay Ratio

    Chief Executive Officer Pay Ratio The fiscal year 2023 total compensation of Sue Nabi, who serves as our Chief Executive Officer was $149,429,486. The fiscal year 2023 total compensation of the Company’s median employee, based on compensation of all our U.S. and non-U.S. employees who were employed as of April 6 , 2023, other than Ms. Nabi, was $39,643. The ratio of the CEO’s total compensation to the median employee’s total compensation (our “Pay Ratio”) in fiscal year 2023 was 3,769 to 1. Excluding the equity awards granted in May 2023, including RSUs that vest over five years, Ms. Nabi’s fiscal year 2023 annualized total compensation would be $3,554,486 and the pay ratio would be 90 to 1. To identify our median employee for fiscal year 2023, we used the same approach and methodology we used in 2022, 2021 and 2020 to identify the Company’s median employee. We included all full-time, part-time, temporary and seasonal employees in 36 countries globally and did not rely on any of the permitted exemptions under the SEC rules. We utilized annualized total cash received as compiled from our payroll records to identify the median employee. The median employee identified is a different employee from the one identified for fiscal year 2022. The SEC’s rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. As a result, the pay ratio reported by other companies may not be comparable to the Pay Ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.

  46. Pay Versus Performance

    Pay Versus Performance The following table and accompanying descriptions set forth information concerning the compensation of our Chief Executive Officer (CEO) and our non-CEO Named Executive Officers (collectively, the “Other NEOs”) for each of the fiscal years ending June 30, 2021, 2022 and 2023 and our financial performance of each such fiscal year. For all periods, Sue Nabi served as Chief Executive Officer, and the other NEOs were, Laurent Mercier, Chief Financial Officer; Kristin Blazewicz, Chief Legal Officer, General Counsel; Anna von Bayern, Chief Corporate Affairs Officer; and Gordon von Bretten, Chief Transformation Officer, except that in 2021, Pierre-Andre Terisse also served as Chief Financial Officer for a portion of the year. As discussed in the Compensation Discussion and Analysis section above, the variable portion of our executive compensation program is tied to long-term stockholder returns through stock-based compensation that vests over many years and changes in the value of these restricted stock awards during a particular fiscal year are driven by stockholder returns in that fiscal year. The Company did not use financial performance measures in setting executive compensation for our CEO and other NEOs during the periods presented.

  47. Pay Versus Performance Table

    Pay Versus Performance Table

  48. Pay Versus Performance Table

    | | | | | | Value of Initial Fixed $100 Investment Based on: | | | | Year (1) | Summary Compensation Table Total for CEO ($) | Compensation Actually Paid to CEO ($)(2)(3) | Summary Compensation Table Total for non-CEO NEOs ($) | Average Compensation Actually Paid to non-CEO NEOs ($)(2)((4) | Total Stockholder Return ($)(5) | Peer Group Total Stockholder Return ($)(6) | Net Income ($)(7) | | Year 1 (Fiscal 2021) | 283,791,455(8) | 283,791,455 | 2,823,173 | 12,131,881 | 72.40 | 174.10 | (166,300,000) | | Year 2 (Fiscal 2022) | 3,557,753 | (18,742,247) | 3,580,579 | 2,314,036 | 63.00 | 136.70 | 55,500,000 | | Year 3 (Fiscal 2023) | 149,429,486(9) | 194,979,486 | 3,469,850 | 7,144,903 | 93.40 | 161.80 | 495,000,000 |

  49. Pay Versus Performance Table

    (1) The following table shows the CEO and Non-CEO NEOs for each of fiscal 2021, 2022 and 2023:

  50. Pay Versus Performance Table

    | Year | CEO | Non-CEO NEOs | | 2021 | Sue Nabi | Laurent Mercier, Kristin Blazewicz, Anna von Bayern, Gordon von Bretten, Pierre-Andre Terisse | | 2022 | Sue Nabi | Laurent Mercier, Kristin Blazewicz, Anna von Bayern, Gordon von Bretten | | 2023 | Sue Nabi | Laurent Mercier, Kristin Blazewicz, Anna von Bayern, Gordon von Bretten |

  51. Pay Versus Performance Table

    (2) The dollar amounts reported represent the amount of “compensation actually paid,” as calculated in accordance with SEC rules. The dollar amounts do not reflect the actual amounts of compensation paid to our executives during the applicable year. In accordance with SEC rules, certain adjustments were made to the Summary Compensation Table total compensation to determine the amount of “compensation actually paid,” including adding (i) the year-end value of equity awards granted during the reported year, and (ii) the change in the value of equity awards that were unvested at the end of the prior year, measured through the date the awards vested or were forfeited, or through the end of the reported fiscal year. For purposes of calculating “compensation actually paid,” the fair value of equity awards is calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (FASB ASC Topic 718) using the same assumption methodologies used to calculate the grant date fair value of awards for purposes of the Summary Compensation Table. (3) The following table shows the amounts deducted from and added to the Summary Compensation Table total compensation to calculate “compensation actually paid” to Ms. Nabi.

  52. Pay Versus Performance Table

    | CEO Compensation Actually Paid | 2021 | 2022 | 2023 | | Summary Compensation Table Total Compensation | $283,791,455 | $3,557,753 | $149,429,486 | | (Minus) Grant Date Fair Value of Awards Granted During the Year | $(280,200,000) | $— | $(145,875,000) | | Plus Fair Value as of Year-End or (if applicable) Vest Date of Equity Awards Granted during the Year | $280,200,000 | $— | $153,625,000 | | Plus (Minus) Change from Prior Year-End in Fair Value of Awards That Vested During the Year | $— | $4,300,000 | $(5,000,000) | | Plus (Minus) Year-over-Year Change in Fair Value of Unvested Awards Granted in Prior Years | $— | $(26,600,000) | $42,800,000 | | Compensation Actually Paid | $283,791,455 | $(18,742,247) | $194,979,486 |

  53. Pay Versus Performance Table

    (4) The following table shows the amounts deducted from and added to the average Summary Compensation Table total compensation to calculate the average “compensation actually paid” to our Non-CEO NEOs.

  54. Pay Versus Performance Table

    | Non-CEO NEO Compensation Actually Paid | 2021 | 2022 | 2023 | | Summary Compensation Table Total Compensation | $2,823,173 | $3,580,579 | $3,469,850 | | (Minus) Grant Date Fair Value of Awards Granted During the Year | $(2,099,998) | $(2,458,323) | $(2,494,055) | | Plus Fair Value as of Year-End or (if applicable) Vest Date of Equity Awards Granted during the Year | $6,110,275 | $2,539,390 | $4,630,202 | | Plus (Minus) Change from Prior Year-End in Fair Value of Awards That Vested During the Year | $874,799 | $(401,054) | $160,578 | | Plus (Minus) Year-over-Year Change in Fair Value of Unvested Awards Granted in Prior Years | $4,423,632 | $(946,557) | $1,699,484 | | Compensation Actually Paid | $12,131,881 | $2,314,036 | $7,144,903 |

  55. Pay Versus Performance Table

    (5) Pursuant to SEC Rules, the total shareholder return (TSR) figures assume an initial investment of $100. The TSR is cumulative for the measurement periods beginning on June 30, 2020 and ending on each of June 30, 2021, 2022 and 2023, respectively, calculated in accordance with Item 201(e) of Regulation S-K. and the TSR of the S&P 500 Index over the same periods. (6) The peer TSR reflects the TSR of the S&P 500 Index and the peer group reported in the Company’s Stock Performance Graph in the 2023 Annual Report on Form 10-K. The Peer Group includes L'Oréal S.A., Inc., Estée Lauder Companies, Inc., Beiersdorf AG, Shiseido Company, Limited and Inter Parfums Inc. (the “Peer Group”). We added Beiersdorf AG to our Form 10-K peer group to replace Revlon, Inc. following its delisting from the New York Stock Exchange. The returns of each company in the Peer Group have been weighted according to their respective stock market capitalization at the beginning of the measurement period for purposes of arriving at a Peer Group average. (7) Consistent with SEC guidance, no additional performance measures are shown because, as discussed in the Compensation Discussion and Analysis, the Company does not use any financial performance measures to link executive compensation to company performance since our executives’ compensation is tied directly to the creation of shareholder value, as reflected by changes in our total shareholder return. (8) On June 30, 2021, Ms. Nabi was granted a one-time sign-on award of 30,000,000 RSUs under the Company’s ELTIP. The award vests and settled in 10,000,000 shares of the Company’s Class A Common Stock on each vesting date of August 31, 2021, August 31, 2022 and August 31, 2023. (9) On May 4, 2023 the Company granted Ms. Nabi a one-time award of 10,416,667 RSUs, which will vest and settle in shares of the Company’s Class A Common Stock over five years on the following vesting schedule: (i) 15% of the RSU Award on September 1, 2024, (ii) 15% of the RSU Award on September 1, 2025, (iii) 20% of the RSU Award on September 1, 2026, (iv) 20% of the RSU Award on September 1, 2027; and (v) 30% of the RSU Award on September 1, 2028, in each case subject to Ms. Nabi’s continued employment through the applicable vesting date. In addition, 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 will 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.

  56. Total Compensation Actually Paid

    Total Compensation Actually Paid The fair value of all equity awards is based on the closing price of our common stock on the vesting or valuation date (or the preceding trading day if such date was not a trading day). The dollar amounts in the total column of the Summary Compensation Table and the Pay Versus Performance Table reflect the grant date fair values with respect restricted stock awards granted during the respective fiscal year. Those amounts may vary significantly year over year due to factors such as stock price volatility, as was the case for the years presented here.