Item 8.01 Other Events.
On May 22, 2019, Avon Products, Inc. (the “
Company
”) and
Natura Cosméticos S.A., a Brazilian corporation (
sociedade anônima
) (“
Natura
”),
jointly issued a press release announcing they had entered into an Agreement and Plan of Mergers (the “
Merger Agreement
”), dated May 22, 2019, among the Company, Natura,
Natura Holding S.A., a Brazilian corporation (
sociedade anônima
) (“
HoldCo
”),
Nectarine Merger Sub I, Inc., a Delaware corporation and, as of the date hereof, a wholly owned direct subsidiary of HoldCo (“
Merger Sub I
”), and Nectarine Merger Sub
II, Inc., a Delaware corporation and, as of the date hereof, a wholly owned direct subsidiary of Merger Sub I. Pursuant to the Merger Agreement, the Company and Natura will be acquired by HoldCo, which will have stock listed on the B3 stock
exchange in Brazil under the Novo Mercado segment and American Depositary Shares (“
ADSs
”) traded on the New York Stock Exchange (“
NYSE
”). At the closing of the transactions, each share of common stock of the Company will be converted into, at the election of each holder, 0.300 HoldCo ADSs traded on NYSE or 0.300 HoldCo shares
listed on B3.
Concurrently with the execution of the Merger Agreement, certain founder shareholders of Natura, who together own approximately 50.5% of
the total voting capital stock of Natura as of May 22, 2019, entered into a voting and support agreement with the Company, Natura and HoldCo, and Cleveland Apple Investor L.P., the holder of the Company’s Series C preferred stock, entered into a
voting and support agreement with Natura and Merger Sub I.
A copy of the joint press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.
Cautionary Statements for Purposes of the “Safe Harbor” Statement Under
the Private Securities Litigation Reform Act of 1995
Statements in this communication (or in the documents it incorporates by reference) that are not historical facts or information may be
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Among other things, these forward looking statements may include statements regarding the proposed combination of the Company and Natura; our
beliefs relating to value creation as a result of a potential combination with Natura; the expected timetable for completing the transaction; benefits and synergies of the transaction; future opportunities for the combined company; and any other
statements regarding the Company’s and Natura’s future beliefs, expectations, plans, intentions, financial condition or performance. In some cases, words such as “estimate,” “project,” “forecast,” “plan,” “believe,” “may,” “expect,” “anticipate,”
“intend,” “planned,” “potential,” “can,” “expectation,” “could,” “will,” “would” and similar expressions, or the negative of those expressions, may identify forward looking statements. They include, among other things, statements regarding our
anticipated or expected results, future financial performance, various strategies and initiatives (including our transformation plan, Open Up Avon, stabilization strategies, cost savings initiatives, restructuring and other initiatives and
related actions), costs and cost savings, competitive advantages, impairments, the impact of foreign currency, including devaluations, and other laws and regulations, government investigations, results of litigation, contingencies, taxes and tax
rates, potential alliances or divestitures, liquidity, cash flow, uses of cash and financing, hedging and risk management strategies, pension, postretirement and incentive compensation plans, supply chain and the legal status of the
representatives. Such forward-looking statements are based on management’s reasonable current assumptions, expectations, plans and forecasts regarding our current or future results and future business and economic conditions more generally. Such
forward-looking statements involve risks, uncertainties and other factors, which may cause the actual results, levels of activity, performance or achievement of Avon to be materially different from any future results expressed or implied by such
forward-looking statements, and there can be no assurance that actual results will not differ materially from management’s expectations. Therefore, you should not rely on any of these forward-looking statements as predictors of future events.
Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, our ability to improve our financial and operational performance and
execute fully our global business strategy, the effect of economic factors, our ability to improve working capital, our ability to reverse declines in active representatives, general economic and business conditions in our markets, our ability to
attract and retain key personnel, competitive uncertainties in our markets, any changes to our credit ratings and the impact of such changes on our financing costs, rates, terms, debt service obligations, access to lending sources and working
capital needs, the risk of an adverse outcome in any material pending and future litigation and those disclosed as risks in other reports filed by us with the Securities and Exchange Commission, including those described in Item 1A of our most
recently filed Annual Report on Form 10-K and subsequent reports on Forms 10-Q and 8-K. Other risks and uncertainties include the timing and likelihood of completion of the proposed combination of the Company and Natura, including the timing,
receipt and terms and conditions of any required governmental and regulatory approvals for the proposed transactions that could reduce anticipated benefits or cause the parties to abandon the transactions; the possibility that the Company’s
shareholders may not approve the proposed transactions; the possibility that Natura’s shareholders may not approve the proposed transactions; the possibility that the expected synergies and value creation from the proposed transactions will not
be realized or will not be realized within the expected time period; the risk that the businesses of the Company and Natura will not be integrated successfully; disruption from the proposed transactions making it more difficult to maintain
business and operational relationships; the risk that unexpected costs will be incurred; the possibility that the proposed transactions do not close, including due to the failure to satisfy the closing conditions; the possibility that the
intended accounting and tax treatments of the proposed transactions are not achieved; the effect of the announcement, pendency or consummation of the proposed transactions on customers, employees, representatives, suppliers and partners and
operating results; as well as more specific risks and uncertainties. We caution readers that any such statements are based on currently available operational, financial and competitive information, and they should not place undue reliance on
these forward-looking statements, which reflect management’s opinion only as of the date on which they were made.Except as required by law, we disclaim any obligation to review or update these forward-looking statements to reflect events or
circumstances as they occur.
Participants in the Solicitation
Natura, the Company, their respective directors and certain of their respective executive officers and employees may be deemed to be
participants in the solicitation of proxies in connection with the proposed transaction. Information about Natura’s directors and executive officers will be set forth in the definitive joint proxy statement/prospectus, and information about the
Company’s directors and executive officers is set forth in its definitive proxy statement filed with the SEC on April 2, 2019, which also may be obtained free of charge from the investor relations page of the Company’s website
www.Avonworldwide.com. To the extent holdings of the Company securities have changed since the amounts contained in the proxy statement for the Company’s 2019 Annual Meeting of Shareholders, such changes have been or will be reflected on
Statements of Change in Ownership on Form 4 filed with the SEC. Additional information regarding the interests of participants in the solicitation of proxies in connection with the proposed transaction will be included in the registration
statement, the joint proxy statement/prospectus and other relevant materials Natura and the Company file with the SEC.
Additional Information and Where to Find It
The proposed transaction involving Natura and the Company will be submitted to the Company’s shareholders and Natura’s shareholders for
their consideration. In connection with the proposed transaction, Natura will prepare a registration statement on Form F-4 that will include a joint proxy statement/prospectus for Company’s shareholders to be filed with the Securities and
Exchange Commission (“SEC”). the Company will mail the joint proxy statement/prospectus to its shareholders, and the Company and Natura will file other documents regarding the proposed transaction with the SEC. This communication is not
intended to be, and is not, a substitute for such filings or for any other document that Natura or the Company may file with the SEC in connection with the proposed transaction. SECURITY HOLDERS ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED
WITH THE SEC, INCLUDING THE REGISTRATION STATEMENT ON FORM F-4 AND THE JOINT PROXY STATEMENT/PROSPECTUS, CAREFULLY WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. The registration statement, the joint proxy
statement/prospectus and other relevant materials (when they become available) and any other documents filed or furnished by Natura or the Company with the SEC may be obtained free of charge at the SEC’s web site at www.sec.gov. In addition,
security holders will be able to obtain free copies of the registration statement and the joint proxy statement/prospectus from Natura by going to its investor relations page on its corporate web site at www.Natura.com and from the Company by
going to its investor relations page on its corporate web site at www.Avonworldwide.com.
No Offer or Solicitation
This communication is neither an offer to buy, nor a solicitation of an offer to sell, subscribe for or buy any securities or the
solicitation of any vote or approval in any jurisdiction pursuant to or in connection with the proposed transaction or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable
law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, and otherwise in accordance with applicable law.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit Number
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Description of Exhibit
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly authorized.
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Avon Products, Inc.
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Date: May 22, 2019
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By:
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/s/ Ginny Edwards
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Name: Ginny Edwards
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Title: Vice President, Interim General Counsel
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and Corporate Secretary
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Exhibit Index
Exhibit Number
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Description of Exhibit
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99.1
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Press Release, dated May 22, 2019, jointly issued by the Company and Natura.
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