NOTE 5. INVESTMENTS AND NONCONTROLLING INTERESTS

Since September, 2012, the Company has invested $13.7 million for a minority investment in Elizabeth Arden Salon Holdings, LLC, an unrelated party whose subsidiaries operate the Elizabeth Arden Red Door Spas and the Mario Tricoci Hair Salons ("Salon Holdings"). The investment in Elizabeth Arden Salon Holdings, LLC, which is in the form of a collateralized convertible note bearing interest at 2%, has been accounted for using the cost method and at September 30, 2015, is included in other assets on the consolidated balance sheet.

Since July, 2013, the Company, through a subsidiary (the "EA USC Subsidiary"), has invested $9.0 million in US Cosmeceutechs, LLC ("USC"), a skin care company that develops and sells skin care products for the professional dermatology and spa channels and separately purchased a 30% equity interest in USC from the sole equity member for $3.6 million. The investment, which is in the form of a collateralized convertible note (the "Convertible Note") , bears interest at 1.5%. Upon conversion of the Convertible Note, the Company will own 85.45% of the fully diluted equity interests in USC (inclusive of EA USC's current equity interest). The Company has a put/call agreement with the other USC equity member with respect to the remaining 14.55% interest in USC. As of September 30, 2015, the Convertible Note had not been converted.

Based on the investment in USC and the EA USC Subsidiary's controlling rights under the operating agreement, the Company has determined that USC is a VIE, of which the Company is the primary beneficiary, requiring consolidation of USC's financial statements in accordance with Topic 810, Consolidation.

The following provides an analysis of the change in the redeemable noncontrolling interest liability for the three months ended September 30, 2015:


*(Amounts in thousands)*		Amount
Balance at June 30, 2015	$	4,222
Net loss attributable to redeemable noncontrolling interests		(430	)
Balance at September 30, 2015	$	3,792

Effective January 4, 2015, the Company, through a subsidiary, entered into a joint venture in the United Arab Emirates (the "UAE Joint Venture") with an unrelated third party for the sale, promotion and distribution of the Company's products primarily in the Middle East. Under the terms of the joint venture agreement, the Company's subsidiary has the option to purchase a 15% ownership interest from the third party after 15 years at a specified price based on the performance of the UAE Joint Venture and also has the option to purchase the entire ownership interest of the third party upon the termination or expiration of the joint venture agreement at a specified price based on the performance of the UAE Joint Venture. Based on the capitalization of the UAE Joint Venture, the Company has determined that the UAE Joint Venture is a VIE, requiring consolidation of such joint ventures' financial statements in accordance with Topic 810, Consolidation. The unrelated third party's interest in the UAE Joint Venture is classified as a "noncontrolling interest" in the shareholders' equity section of the Company's consolidated balance sheet.

Effective September 1, 2015, the Company, through a subsidiary, entered into a joint venture with an unrelated third party for the sale, promotion and distribution of the Company's products in Southeast Asia and, effective January 1, 2016, in Hong Kong ("the Southeast Asia Joint Venture"). Based on the capitalization of the Southeast Asia Joint Venture, the Company's subsidiary has a 60% ownership interest and the third party has a 40% ownership interest. Under the terms of the Southeast Asia Joint Venture agreement, the Company's subsidiary has the option to purchase the entire ownership interest of the third party upon the termination or expiration of the Southeast Asia Joint Venture agreement at a specified price based on the performance of the Southeast Asia Joint Venture.

Based on the terms of the Southeast Asia Joint Venture agreements, the Company's subsidiary has control of the board of managers and the power to direct activities that could have a substantial impact on the economic performance of the Southeast Asia Joint Venture , including those that could result in the obligation to absorb losses or the right to receive benefits that could potentially be significant to the joint venture. Based on such equity interests and controlling rights in the Southeast Asia joint venture, the Company has determined that the Southeast Asia Joint Venture is a VIE, requiring consolidation of such joint venture's financial statements in accordance with Topic 810, Consolidation. The unrelated third party's interest in the joint venture is classified as a "noncontrolling interest" in the shareholders' equity section of the Company's consolidated balance sheet.