<PAGE>
As filed with the Securities and Exchange Commission on September 13, 1996
Registration No. 333-
==============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_________________
PARLUX FRAGRANCES, INC.
(Exact name of registrant as specified in its charter)
Delaware 22-2562955
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
_____________
3725 S.W. 30th Avenue
Ft. Lauderdale, Florida 33312
(954) 316-9008
(Address, including zip code and telephone number, including
area code, of registrant's principal executive offices)
Ilia Lekach
Chairman and Chief Executive Officer
Parlux Fragrances, Inc.
3725 S.W. 30th Avenue
Ft. Lauderdale, Florida 33312
(954) 316-9008
(Name, address, including zip code, and telephone number
including area code, of agent for service)
_____________
Copies to:
Barry P. Biggar, Esq.
Mayer, Brown & Platt
1675 Broadway
New York, New York 10019
<PAGE>
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities
Act of 1933, other than securities offered only in connection with dividend
or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering.
[ ]___________________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ] ______________________
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==============================================================================
Proposed Proposed
Maximum Maximum
Title of Each Class Amount Offering Aggregate Amount of
of Securities to be Price Offering Registration
to be Registered Registered Per Share(1) Price(1) Fee
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value 2,154,222 $5 15/16 $12,790,693 $4,410.61
$.01 per share
==============================================================================
<FN>
(1) Estimated in accordance with Rule 457 solely for the purpose of
determining the registration fee and based on the average closing bid and
ask prices as reported by the National Association of Securities Dealers
Automatic Quotation System National Market on September 6, 1996.
</TABLE>
---------------
The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
==============================================================================
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor
may offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell
or the solicitation of an offer to buy nor shall there be any sale of these
securities in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws
of any such State.
Subject to Completion, dated September 13, 1996
2,154,222 Shares
PARLUX FRAGRANCES, INC.
Common Stock
Unless the context indicates or requires otherwise, references in this
Prospectus to the "Company" are to Parlux Fragrances, Inc., a Delaware
corporation, and its subsidiaries. This Prospectus has been prepared for
use in connection with the proposed sale by Southbrook International
Investments Limited ("Southbrook") and Kempton Investments Ltd. ("Kempton," and
together with Southbrook, the "Selling Stockholders") of an aggregate of
2,154,222 shares (the "Shares") of the Company's common stock, $.01 par value
per share (the "Common Stock"), which represents shares of Common Stock that
may be received upon the conversion on some future date of the Company's 5%
convertible debentures in the aggregate principal amount of $10,000,000 held
by Southbrook and Kempton. The Shares may be offered and sold by the Selling
Stockholders from time to time directly or through agents designated from time
to time or to or through broker-dealers designated from time to time. The
Shares may be sold in one or more transactions at a fixed price or prices,
which may be changed, at market prices prevailing at the same time of sale, at
prices related to such prevailing market prices or at prices determined on a
negotiated or competitive bid basis. Shares may be sold through a
broker-dealer acting as agent or broker for the Selling Stockholders, or to a
broker-dealer acting as principal. See "Plan of Distribution."
The Common Stock is traded on the Nasdaq National Market under the
trading symbol PARL. On September 6, 1996, the closing price for the
Common Stock as reported on the Nasdaq National Market was $5 15/16 per
share.
The Company will receive no portion of the proceeds of the sale of the
Shares offered hereby and will bear certain of the expenses incident to their
registration. See "Plan of Distribution" and "Selling Stockholders."
The Shares have not been registered for sale under the securities laws
of any state or jurisdiction as of the date of this Prospectus. Brokers or
dealers effecting transactions in the Shares should confirm the existence of
any exemption from registration or the registration thereof under the
securities laws of the states in which such transactions occur.
<PAGE>
See "Risk Factors" beginning on page 3 for a discussion of certain
matters that should be considered by prospective purchasers of the Shares.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
----------------------
The date of this Prospectus is 1996
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act") and in
accordance therewith files reports and other information with the
Securities and Exchange Commission (the "SEC"). Reports, proxy statements,
and other information filed by the Company with the SEC can be inspected
and copied at the public reference facilities maintained by the SEC at 450
Fifth Street, N.W., Washington, D.C. 20549, as well as the regional offices
of the SEC at the Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511, and Seven World Trade Center, New York, New
York 10048. Copies of such material can be obtained from the Public
Reference Section of the SEC in its Washington D.C. office at prescribed
rates. The Common Stock is traded on the Nasdaq National Market.
This Prospectus constitutes a part of the Registration Statement on
Form S-3 (together with all amendments and exhibits thereto, the
"Registration Statement") filed by the Company with the SEC under the
Securities Act of 1933, as amended (the "1933 Act"). This Prospectus omits
certain of the information contained in the Registration Statement, and
reference is hereby made to the Registration Statement for further
information with respect to the Company and the securities offered hereby.
Any statements contained herein concerning the provisions of any document
filed as an exhibit to the Registration Statement or otherwise filed with
the SEC are not necessarily complete, and in each instance reference is
made to the copy of such documents so filed. Each such statement is
qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, heretofore filed with the SEC by the Company
pursuant to the 1934 Act, are incorporated by reference:
(a) Annual Report on Form 10-K for the year ended March 31, 1996.
(b) Quarterly Report on Form 10-Q for the period ended June 30, 1996.
(c) The description of the Common Stock contained under the caption
"Description of Registrant's Securities to be Registered" included
in the Company's Registration Statement on Form 8-A, filed with the
SEC on March 13, 1987, including any amendment or report filed for
the purpose of updating such description.
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the 1934 Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Common Stock pursuant
hereto shall be deemed to be incorporated by reference in this Prospectus
and to be a part hereof from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for
purposes of this document to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to
be incorporated by reference herein modifies or supersedes such statement.
Any statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon written or
oral request of such person, a copy of any or all documents that have been
incorporated by reference in this Prospectus (not including exhibits to the
documents that are incorporated by reference unless such exhibits are
specifically incorporated by reference into the documents that this
Prospectus incorporates). Requests for such copies should be directed to
the Company at 3725 S.W. 30th Avenue, Ft. Lauderdale, Florida 33312,
Attention: Corporate Secretary, telephone number (954) 316-9008.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED
IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR THE SELLING STOCKHOLDERS. THIS PROSPECTUS DOES NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY ANY OF THE
SECURITIES HEREBY OFFERED IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER
THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THAT THERE HAS BEEN
ANY CHANGE IN THE AFFAIRS OF THE COMPANY SINCE SUCH DATE, OR IN THE CASE OF
INFORMATION INCORPORATED HEREIN BY REFERENCE, THE DATE OF FILING OF SUCH
INCORPORATED INFORMATION WITH THE SECURITIES AND EXCHANGE COMMISSION.
THE COMPANY
The Company is engaged in the design, development and marketing of
prestige fragrances and personal care products. The Company sells its
product lines under such designer brand names as Todd Oldham(R), Vicky Tiel
Sirene(R), Fred Hayman's Touch(R), 273(R), Personal Selection(R), With Love(R),
Phantom of the Opera(R), Perry Ellis for Men(R), 360 degrees Perry Ellis(R),
Perry Ellis America(R) and Baryshnikov(R) pursuant to exclusive license
agreements. The Company also sells its product lines under the brand names
Alexandra de Markoff(R), Animale(R), Bal A Versailles(R), Daniel de Fasson(R),
Decadence and Limousine(R). The Company's products are designed and marketed
to promote a high level of brand recognition and consumer appeal by combining
quality, prestige fragrances and cosmetics with distinctively styled packaging
tailored to each product's image. The Company's basic products generally
retail at prices ranging from $20 to $300 per item.
The Company was incorporated in the State of Delaware on July 23,
1984. Its principal executive offices are located at 3725 S.W. 30th
Avenue, Ft. Lauderdale, Florida 33312, and its telephone number is
(954) 316-9008.
RISK FACTORS
Lack of Substantial Historical Profitability; Decline in Revenues;
Future Operating Results. Although the Company achieved growth in revenues
for the fiscal years ended March 31, 1992 and 1993, the Company had limited
profitability during each such year. In addition, revenues for the year
ended March 31, 1994 declined by 10.8% from the year ended March 31, 1993,
principally as a result of discontinued sales of certain licensed products.
Revenues for the years ended March 31, 1995 and March 31, 1996 and for the
three-month period ended June 30, 1996, however, increased by 50.6%, 77.3%
and 83.6%, respectively, as compared to the results from the corresponding
period in the prior year, primarily as a result of product acquisitions.
There can be no assurance, however, that the Company's revenues will not
decline in the future or that the Company's future operations will continue
to be profitable.
Risk of Acquisitions; Uncertainty of Product Integration. Since June
1994, the Company has rapidly expanded through a series of acquisitions of
trademarks and/or license agreements for fragrance and beauty products.
The Company has committed and expects to continue to commit significant
financial and other resources in connection with the continued development
and commercialization of the products it acquired in these various
acquisitions. Successful commercialization of such products will be
dependent upon the Company meeting targeted production costs for such
products, and may also depend upon the timely introduction of new products
under the acquired brands into the marketplace. The Company's efforts are
subject to all of the risks inherent in the development and
commercialization of new products, including unanticipated delays,
expenses, problems or difficulties, as well as the possible insufficiency
of funds, which could result in abandonment or substantial change in
product commercialization. There can be no assurance that the Company will
be able to successfully integrate newly acquired or developed products into
its operations, that sales of such products will result in significantly
increased levels of revenues or profitable operations or that unanticipated
problems will not occur which would result in increased costs or material
delays in product commercialization. In addition, the Company may require
additional debt and/or equity financing to continue its business plan of
acquiring strategic trademarks and license agreements. No assurance can be
made, however, that additional financing will be available or, if
available, be on terms that are acceptable to the Company. The failure to
continue its expansion by acquisition or the integration of newly acquired
or developed products into the Company's operations could have a material
adverse effect on the Company's financial condition and results of
operations.
Possible Adverse Effects of Loan Covenants. On December 29, 1994,
Parlux, Ltd., a wholly-owned subsidiary of the Company, entered into a
three-year $5,000,000 revolving credit facility (the "Credit Agreement")
with Finova Capital Corporation ("Finova"). In May 1996, the Credit
Agreement was amended to provide for a temporary $1,000,000 increase in the
revolving credit facility until August 29, 1996, which was further extended
until September 28, 1996. Parlux, Ltd. granted Finova a security interest
in substantially all of its assets as collateral for loans made under the
Credit Agreement. In addition, the Company has guaranteed substantially
all of the obligations of Parlux, Ltd. under the Credit Agreement and
pledged all of its assets, including its intellectual property rights and
Parlux, Ltd. stock holdings as additional collateral for loans under the
Credit Agreement. The Credit Agreement contains covenants which prohibit
Parlux, Ltd. from, among other things, incurring additional indebtedness in
excess of a specified amount without the prior written consent of Finova,
except for trade payables and other contractual obligations to suppliers
and customers incurred in the ordinary course of business. In addition to
certain financial covenants relating to net worth, interest coverage and
other financial ratios, the Credit Agreement limits or prohibits Parlux,
Ltd., without the prior written consent of Finova, from merging or
consolidating with another corporation, paying dividends, acquiring all or
substantially all of the assets of another corporation, selling all or
substantially all of its assets, creating liens or security interests on
Parlux, Ltd.'s assets, entering into transactions with affiliates and
changing the composition of its Board of Directors. Failure to comply with
loan covenants under the Credit Agreement could result in an event of
default under the Credit Agreement which, in turn, could result in a
foreclosure on substantially all of the assets of the Company.
Outstanding Indebtedness; Personal Guarantees and Pledges. As of June
30, 1996, the Company had an aggregate of approximately $15,697,000
principal amount of outstanding secured indebtedness, of which
approximately (i) $5,057,000 represents amounts owed to Fred Hayman Beverly
Hills, Inc. ("Fred Hayman") pursuant to a ten-year promissory note secured
by certain Fred Hayman trademarks, (ii) $2,794,000 represents indebtedness
incurred in recent acquisitions by the Company, (iii) $5,841,000 represents
outstanding indebtedness under the Credit Agreement and (iv) $2,005,000
represents demand indebtedness of the Company's wholly-owned subsidiary,
Parlux S.A. The foregoing creditors of the Company, as a group, have
security interests in substantially all present and future acquired assets
of the Company. In the event that the Company defaults on an obligation
owed to one of these creditors, such creditor could accelerate its loan and
foreclose on its pledged property, possibly requiring the Company to use
additional capital resources, if available, to repay any deficiency owed
to such creditor. To the extent that the Company uses additional capital
resources to repay such indebtedness or to replace the foreclosed
collateral, if possible, the Company would have less resources available to
it to devote to the continued operation and expansion of its business which
would have a material adverse effect on the Company's results of
operations. In addition, as of June 30, 1996, the Company had issued
convertible debentures in the aggregate principal amount of $10,250,000
($20,000,000 as of August 31, 1996) which may be converted into shares of
Common Stock at the option of the holder pursuant to a specified formula.
The Company has been able to borrow substantial sums as a result of
the personal guarantees and pledges of personal assets of Ilia Lekach, the
Company's Chairman of the Board and Chief Executive Officer, Frederick E.
Purches, the Company's Vice Chairman of the Board, and Zouheir Beidoun, a
stockholder and a former director of the Company. Messrs. Beidoun and
Purches have deposited approximately $1,000,000 with the National Bank of
Kuwait SAK to support a $1,000,000 letter of credit which serves as part of
the collateral under the Credit Agreement. There can be no assurance that
such personal guarantees or pledged assets will be available in the future
or that the absence of any such personal guarantees or pledged assets will
not adversely affect the Company's ability to borrow.
Liquidity; Significant Capital Requirements; Possible Need for
Additional Financing. The Company's capital requirements have been and
will continue to be significant. The Company has in the past been
substantially dependent on bank borrowings and loans from affiliates in
order to finance its working capital requirements. The Company
anticipates, based on currently proposed plans and assumptions relating to
its operations (including the timetable of, and costs associated with,
potential acquisitions and new product development), that cash flow from
operations, existing working capital, and borrowings under the Credit
Agreement will be sufficient to satisfy its anticipated cash requirements
for approximately twelve months following the date of this Prospectus. In
the event that the Company's assumptions change or prove to be inaccurate,
it may be necessary for the Company to seek additional financing sooner
than anticipated. There can be no assurance that any such additional
financing will be available to the Company on acceptable terms, if at all.
Dependence on Principal Customer. To date, a substantial portion of
the Company's revenues have been derived from Perfumania, an affiliate of
the Company. For the years ended March 31, 1994, 1995 and 1996 and the
three-month period ended June 30, 1996, sales of products to Perfumania
accounted for 48.9%, 39.9%, 38.7% and 23.2%, respectively, of the Company's
revenues. Net amounts owed by Perfumania to the Company totaled
$15,883,430 at June 30, 1996. The Company is dependent on sales to
Perfumania of its excess inventory at discount prices and peaked or matured
products, such as Decadence(R), Phantom of the Opera(R) and Limousine(R)
(which are sold almost exclusively to Perfumania). The Company does not
maintain contracts with any of its customers, which purchase products from
the Company pursuant to purchase orders placed from time to time in the
ordinary course of business. The loss of any of the Company's principal
customers, particularly Perfumania, or a decline in the economic prospects
of such customers, resulting in a substantial reduction in the purchase of
the Company's products, would have a material adverse effect on the
Company. Perfumania reported a loss of $2,396,759, a profit of $1,325,000
and a profit of $2,002,110 for the years ended January 29, 1994, January
28, 1995 and February 3, 1996, respectively. There can be no assurance
that the Company will be able to retain existing customers or attract and
retain new customers, or that it will not remain largely dependent on a
limited customer base for all or a substantial portion of its revenues.
Significant Competition; Consumer Preferences and Industry Trends.
The Company faces significant competition in the marketing and sale of its
products. The Company's products compete for consumer recognition and
shelf space with fragrance and cosmetic products which have achieved
significant international, national and regional brand name recognition and
consumer loyalty. These products are marketed by companies with
significantly greater financial, marketing, distribution, personnel and
other resources than the Company, thereby permitting such companies to
implement extensive advertising and promotional programs, both generally
and in response to efforts by additional competitors to enter into new
markets and introduce new products. The fragrance and cosmetic industry is
also characterized by the frequent introduction of new products,
accompanied by substantial promotional campaigns, and is subject to rapidly
changing consumer preferences and industry trends resulting in short
product life cycles, which may adversely affect the Company's ability to
plan for future design, development and promotion of its products. The
Company's success will depend on the Company's ability to anticipate and
respond to various competitive factors affecting this industry, including
new products which may be introduced, new market entrants, changes in
consumer preferences, demographic trends, international, national, regional
and local economic conditions and discount pricing strategies by
competitors, including Perfumania, all of which could adversely affect the
Company.
Fluctuations in Operating Results; Seasonality. The Company's
operating results vary from period to period as a result of the seasonal
nature of the Company's business, as well as from purchasing patterns of
customers, the timing and introduction of new products by the Company and
its competitors, the Company's product mix resulting from newly acquired
and discontinued products, variations in sales by distribution channels and
products and competitive pricing. The Company's operating results may also
fluctuate from period to period as a result of significant initial or
additional orders by customers which fail to achieve significant
"sell-through," resulting in product returns and decreased revenues in
subsequent periods. Sales of the Company's products are highly seasonal,
with peak product shipments occurring in the third and fourth quarters, as
a result of increased demand for fragrance products in anticipation of the
Christmas holiday season. Unanticipated events, including delays in
securing adequate inventories of products at the time of peak sales, or
significant decreases in sales during such periods, could adversely affect
the Company's results. In addition, the Company follows industry practice
to provide department stores with rights to return merchandise, and as
such, the Company establishes reserves and provides allowances for product
returns at the time of sale. While the Company believes that such reserves
and allowances are adequate based on past experience, no assurances can be
made that reserves and allowances will continue to be adequate. If product
returns are in excess of the reserves and allowances made by the Company,
sales will be reduced in later periods.
Importance of Third-Party License Agreements. The Company has
obtained exclusive rights to market Todd Oldham(R), Vicky Tiel Sirene(R), Fred
Hayman's Touch(R), 273(R), Personal Selection(R), With Love(R), Phantom of the
Opera(R), Perry Ellis for Men(R), 360 degrees Perry Ellis(R), Perry Ellis
America(R) and Baryshnikov(R) fragrances and related products pursuant to
exclusive license agreements with third parties. For the year ended March 31,
1996, sales from licensed products increased to approximately 78% of the
Company's revenues, as compared to approximately 74% for the prior fiscal year,
primarily as a result of product acquisitions. Certain of these license
agreements require the Company, among other things, to pay royalties,
satisfy minimum sales requirements (which increase each year and upon
renewal) and devote significant sums for advertising. In May of 1995, the
Company terminated its license agreement with Francesco Smalto,
International for breach of contract. On October 5, 1995, the Company
entered into a transition and termination agreement with Francesco Smalto
International which provides for the continued use of the Francesco Smalto
trademark by the Company through September 30, 1996. The agreement
contains certain production restrictions, and requires a fixed amount of
royalty payments during the period, which the Company believes will
approximate 5% of total Company net sales of Francesco Smalto products
during the transition period. Sales of Francesco Smalto products
represented approximately 7% of total Company net sales for the year ended
March 31, 1996.
Failure by the Company to satisfy its obligations under license
agreements or note agreements thereunder may result in modification of the
terms or termination of the relevant agreement. While the Company has
satisfied all of its obligations under the license agreements in the past,
there can be no assurance that the Company will have the ability to satisfy
all of its obligations under the license agreements in the future.
Modification or termination of such license agreements could have a
material adverse effect on the business and financial condition of the
Company.
Foreign Operations; Currency Fluctuations. The Company conducts a
part of its operations in France through its wholly-owned subsidiary,
Parlux S.A. For the years ended March 31, 1994, 1995 and 1996 and the
three-month period ended June 30, 1996, Parlux S.A. accounted for 33.2%,
18.9%, 17.5% and 6.7%, respectively, of the Company's revenues and, at June
30, 1996, accounted for 5.6% of the Company's assets. The Company is
subject to various risks inherent in foreign sales, such as increased
credit risks, shipping delays, import quotas and other trade restrictions,
all of which could adversely affect the Company's ability to deliver
products on a timely and competitive basis. Presently, approximately 5% of
the Company's products are purchased in France using the French franc and,
as such, the Company is subject to the risk that the value of the dollar
will decline against the French franc. The Company continues to transition
all manufacturing of its products to the United States during the current
fiscal year, and intends to consolidate its worldwide distribution
activities in the United States. Prior to the completion of these
transitions, significant fluctuations in foreign exchange rates could
affect the prices obtainable for sale of the Company's products denominated
in foreign currencies. To date, the Company has not engaged in currency
hedging transactions.
Dependence on Third-Party Manufacturers and Suppliers. The Company is
mainly dependent on third-party manufacturers and suppliers, some of which
are presently located in France, for all of its supply of fragrances and
related products and packaging materials for resale to its customers. The
Company currently obtains all of its materials and products from a limited
number of manufacturers and suppliers, certain of which provide a
significant portion of the Company's requirements. The Company is
substantially dependent on the ability of its manufacturers and suppliers
to dedicate sufficient production capacity to provide adequate inventories
of finished products, components and raw materials on a timely basis and on
favorable pricing and other terms. Failure or delay by manufacturers and
suppliers in supplying finished products to the Company on favorable terms
could have an adverse effect on the Company.
Outstanding Trade Payables. At March 31, 1996, the Company owed
approximately $18,700,000 to various trade and other creditors,
approximately $1,400,000 of which was more than 120 days old. These
amounts have been reduced to $11,326,000 and $928,000, respectively, as of
June 30, 1996. Although the Company has in the past been able to work with
its suppliers and has been able to maintain continuity of supply by
accepting higher prices and longer lead times, there can be no assurance
that vendors will continue to supply materials or services to the Company
without substantial payments or otherwise seek to enforce their rights
against the Company. The inability to obtain credit on commercially
reasonable terms, or at all, resulting in an interruption of supplies or
services, could have a material adverse effect on the Company.
Reliance on Trademarks. The Company holds and is currently being
assigned several United States and international registered trademarks with
respect to its products and has exclusive licenses to use the trademarks
relating to its licensed products, which the Company believes are of
material importance to its business. There can be no assurance, however,
as to the breadth or degree of protection which existing or future
trademarks, if any, may afford the Company. Although the Company believes
that its trademarks and the trademarks of its licensors do not and will not
infringe on the proprietary rights of third parties, there can be no
assurance that such trademarks do not or will not violate the proprietary
rights of others. In the event that the Company's or its licensors'
trademarks infringe trademarks or proprietary rights of others, the Company
could, under certain circumstances, become liable for damages, which could
have a material adverse effect on the Company.
Product Liability and Insurance. The Company may be exposed to
potential product liability claims by consumers who use the Company's
products. The Company currently maintains product liability insurance
coverage in the amount of $5,000,000 and an additional "umbrella" insurance
policy in the amount of $5,000,000. The Company believes that its current
level of insurance is adequate for the types of products currently
marketed. There can be no assurance, however, that such insurance will be
sufficient to cover potential claims or that the present level of coverage
will be available in the future at a reasonable cost.
Dependence on Key Personnel. The success of the Company is largely
dependent on the personal efforts of Ilia Lekach, its Chairman of the Board
and Chief Executive Officer, Zalman Lekach, its President and Chief
Operating Officer, Frank A. Buttacavoli, its Executive Vice President and
Chief Financial Officer, and other key personnel. Although the Company has
entered into three-year employment agreements with each of such individuals
as of April 1994, January 1995, and April 1993 (which has been extended for
one year), respectively, the loss of the services of such individuals or
other key employees could have a material adverse effect on the Company's
business and prospects. The success of the Company may also be dependent
upon its ability to hire and retain additional qualified financial,
marketing and other personnel.
Concentration of Ownership; Potential Conflicts of Interest. As of
August 31, 1996, Ilia Lekach, Chairman of the Board and Chief Executive
Officer of the Company, together with other officers, directors and
affiliates of the Company, beneficially owned an aggregate of approximately
21.2% of the outstanding shares of the Company's Common Stock.
Accordingly, such persons are in a position to effectively control the
Company, elect all or a majority of the Company's directors, increase
authorized capital, merge or sell the assets of the Company and generally
direct the affairs of the Company. In addition, Mr. Ilia Lekach
beneficially owns, approximately 28.8% of the outstanding voting securities
of Perfumania, the Company's largest customer. Transactions between the
Company and Perfumania or other affiliates may involve conflicts arising
from Mr. Lekach's respective interests in the Company and Perfumania. The
Company has also entered into other transactions with persons and entities
deemed to be affiliates of the Company, including borrowings from relatives
of Mr. Ilia Lekach and from Mr. Zouheir Beidoun. The Company believes that
the terms of the transactions between the Company and Perfumania and other
affiliates have been on terms no less favorable to the Company than could
have been obtained from unaffiliated parties. There can be no assurance,
however, that future conflicts of interest will not arise with respect
thereto, or that if conflicts do arise, they will be resolved in a manner
favorable to the Company. Pursuant to the terms of the Credit Agreement,
the Company is prohibited from entering into any transactions with
officers, directors, principal stockholders or affiliates unless the terms
thereof are disclosed to Finova and are no less favorable to the Company
than could be obtained in arm's length transactions with independent third
parties.
Substantial Dilution Caused by Outstanding Options, Warrants and
Convertible Debentures. As of August 31, 1996, there were outstanding
stock options and warrants to purchase an aggregate of 2,090,978 shares of
Common Stock, at exercise prices ranging from $1.44 to $8.11 per share, and
$20,000,000 aggregate principal amount of convertible debentures, which may
be converted at the option of the holder into shares of Common Stock based
on a conversion rate of 85% (86% for the convertible debentures issued by
the Company on July 2, 1996 in the aggregate principal amount of
$10,000,000) of the average closing price of the Common Stock on the Nasdaq
National Market during a specified time period prior to the date of
conversion. To the extent that the outstanding stock options and/or
warrants are exercised and when the convertible debentures are converted,
dilution to the interests of the Company's stockholders will occur.
Moreover, the terms upon which the Company will be able to obtain
additional equity capital may be adversely affected since the holders of
the outstanding options and warrants can be expected to exercise them at a
time when the Company would, in all likelihood, be able to obtain any
needed capital on terms more favorable to the Company than those provided
in the outstanding options and warrants.
Authorization of Preferred Stock. The Company's Certificate of
Incorporation authorizes the issuance of "blank check" preferred stock with
such designations, rights and preferences as may be determined from time to
time by the Board of Directors. Accordingly, the Board of Directors is
empowered, without stockholder approval, to issue preferred stock with
dividend, liquidation, conversion, voting or other rights which could
adversely affect the voting power or other rights of the holders of the
Company's Common Stock. In the event of issuance, the preferred stock
could be utilized, under certain circumstances, as a method of
discouraging, delaying or preventing a change in control of the Company.
Although the Company has no present intention to issue any shares of its
preferred stock, there can be no assurance that the Company will not do so
in the future.
No Dividends. The Company has not paid any cash dividends on its
Common Stock and does not expect to declare or pay any cash dividends for
the foreseeable future. Any payment of dividends will be at the discretion
of the Board of Directors and will be dependent on the earnings and
financial requirements of the Company and other factors, including
restrictions imposed by the Delaware General Corporation Law on the payment
of dividends, covenants in the Credit Agreement, and such other factors as
the Board of Directors deems relevant.
Volatility of Market Price for the Common Stock. The market price for
the Common Stock prior to the date hereof has been highly volatile.
Factors such as the Company's operating results and announcements by the
Company or its competitors concerning new products may have a significant
impact on the market price for the Common Stock. Additionally, in recent
years, the stock market has experienced a high level of price and volume
volatility and market prices for the stock of many companies have
experienced wide price fluctuations not necessarily related to the
operating performance of such companies.
Shares Eligible for Future Sale. As of August 31, 1996, the Company
had outstanding 13,679,711 shares of Common Stock, of which 12,881,343 are
freely tradeable under the 1933 Act and 798,368 are presently eligible for
immediate sale under Rule 144 promulgated under the 1933 Act. Effective
August 12, 1996, the Company registered on a Form S-3 Registration
Statement (File No. 333-8395) (the "1996 Form S-3 Registration Statement")
an aggregate of 1,617,646 shares of Common Stock that may be received upon
the conversion on some future date of the Company's 5% convertible
debentures in the aggregate principal amount of $10,000,000 issued during
May 1996. In addition, the Company will register hereunder an aggregate of
2,154,222 shares of Common Stock that may be received upon the conversion
by the Selling Stockholders on some future date of the Company's 5%
convertible debentures in the aggregate principal amount of $10,000,0000
issued on July 2, 1996. The possibility that substantial amounts of Common
Stock may be sold in the public market may adversely affect prevailing
market prices for the Common Stock and could impair the Company's ability
to raise capital through the sale of its equity securities.
USE OF PROCEEDS
Any Shares sold pursuant to this Prospectus will be sold by the
Selling Stockholders for their own account and the Company will not receive
any proceeds from such sales.
SELLING STOCKHOLDERS
The following table sets forth the name of the Selling Stockholders,
the number of shares of Common Stock beneficially owned by the Selling
Stockholders as of August 31, 1996, the maximum number of shares of Common
Stock to be held by the Selling Stockholders assuming that all the Shares
owned by them are sold in this offering, and the percentage of outstanding
Common Stock owned by the Selling Stockholders assuming that all the Shares
are sold.
<TABLE>
<CAPTION>
Minimum Minimum
Maximum Number Percentage
Number of Number of of Shares of Common
Shares Owned of Shares to be Owned Stock Owned
Prior to the to be Sold in After the After the
Name Offering(1) the Offering Offering(1) Offering(1)
- ---- ------------- -------------- ------------- ------------
<S> <C> <C> <C> <C>
Southbrook
International
Investments
Limited........... 1,077,111(2) 1,077,111 0 0%
Kempton Investments
Ltd............. 1,077,111(2) 1,077,111 0 0
_______________________
<FN>
(1) Calculated pursuant to Rule 13d-3(d) of the 1934 Act. Under such
Rule, shares subject to options, warrants, rights or conversion
privileges exercisable within 60 days are deemed outstanding for the
purpose of calculating the number and percentage owned by such person,
but not deemed outstanding for the purpose of calculating the
percentage owned by each other person listed. At August 31, 1996,
there were 13,679,711 shares of Common Stock issued and outstanding.
(2) In accordance with the $5,000,000 convertible debenture agreements
that the Company entered into with each of Southbrook (as assignee of
Newsun Limited, effective as of August 30, 1996) and Kempton on July
2, 1996, each debenture is convertible into shares of Common Stock
based on a conversion rate of 86% of the average closing price of the
Common Stock during the five day period immediately prior to the date
of conversion. In connection with these debenture agreements, the
Company also agreed to register under the 1933 Act the shares of
Common Stock underlying the convertible debentures prior to their
conversion. Thus, for purposes of determining the number of shares of
Common Stock to be registered hereunder for each of Southbrook and
Kempton, the Company based its calculation on (i) the closing price of
the Common Stock on September 6, 1996 (the "Base Convertible
Shares") plus (ii) the product of .10 times the Base Convertible
Shares in order to cover fluctuations in the price of the Common Stock
prior to the actual conversion date of the debentures. Should the
foregoing amount be insufficient to cover all of the shares of Common
Stock that Southbrook and Kempton are entitled to have registered, the
Company will file a post-effective amendment to this Registration
Statement to cover such shortfall.
</TABLE>
PLAN OF DISTRIBUTION
If and when the Shares are sold, it is anticipated that such Common
Stock will be sold from time to time primarily in transactions on the
Nasdaq National Market or any other exchange on which the Common Stock is
listed, at the market price then prevailing, although sales may also be
made in negotiated transactions or otherwise, at prices related to such
prevailing market price or otherwise. If Shares are sold through brokers,
the Selling Stockholders may pay customary brokerage commissions and
charges. The Selling Stockholders may effect such transactions by selling
Shares to or through broker-dealers, and such broker-dealers may receive
compensation in the form of discounts, concessions or commissions from the
Selling Stockholders and/or the purchasers of Shares for whom such
broker-dealers may act as agent or to whom they may sell as principal, or
both (which compensation as to a particular broker-dealer might be in
excess of customary commissions). The Selling Stockholders and any
broker-dealers that act in connection with the sale of the Shares hereunder
might be deemed to be "underwriters" within the meaning of Section 2(11) of
the 1933 Act, and any commissions received by them and any profit on the
resale of Shares as principal might be deemed to be underwriting discounts
and commissions under the 1933 Act.
The Selling Stockholders have advised the Company that during such
times as the Selling Stockholders may be deemed to be engaged in a
distribution of the Company's Common Stock, and therefore deemed an
"underwriter" under the 1933 Act, they will comply with Rules 10b-6 and
10b-7 under the 1934 Act and will, among other things: (i) not engage in
any stabilization activities in connection with the Company's securities;
(ii) furnish each broker through which Shares may be offered copies of this
Prospectus, as may be amended from time to time, as requested by a broker;
and (iii) not bid for or purchase any securities of the Company or attempt
to induce any person to purchase any securities of the Company other than
as permitted under the 1934 Act.
There can be no assurances that the Selling Stockholders will sell any
or all of the Shares offered hereunder.
EXPERTS
The financial statements incorporated in this Prospectus by reference
to the Annual Report on Form 10-K of Parlux Fragrances, Inc. for the year
ended March 31, 1996 have been so incorporated in reliance on the report of
Price Waterhouse LLP, independent certified public accountants, given on
the authority of said firm as experts in auditing and accounting.
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon on
behalf of the Company by Mayer, Brown & Platt, New York, New York.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the estimated expenses (all of which
will be borne by the Company) incurred in connection with the issuance and
distribution of the securities being registered, other than underwriting
discounts and commissions (if any). All of the amounts shown are
estimates, except the SEC registration fee.
SEC registration fee...................................... $ 4,410.61
Legal fees and expenses................................... 5,000.00
Accounting fees and expenses.............................. 2,500.00
Miscellaneous............................................. 2,000.00
_________
Total............................................... $ 13,910.61
=========
Item 15. Indemnification of Directors and Officers
(a) The General Corporation Law of the State of Delaware (Section
145) gives Delaware corporations broad powers to indemnify their present
and former directors and officers and those of affiliated corporations
against expenses incurred in the defense of any lawsuit to which they are
made parties by reason of being or having been such directors or officers,
subject to specified conditions and exclusions; gives a director or officer
who successfully defends an action the right to be so indemnified; and
authorizes the Company to buy directors' and officers' liability insurance.
Such indemnification is not exclusive of any other rights to which those
indemnified may be entitled under any by-laws, agreement, vote of
stockholders or otherwise.
(b) Article 10 of the Certificate of Incorporation of the Company
requires, and Bylaws of the Company provides for, indemnification of
directors, officers, employees and agents to the full extent permitted by
law.
(c) In accordance with Section 102(b)(7) of the Delaware General
Corporation Law, the Company's Certificate of Incorporation provides that
directors shall not be personally liable for monetary damages for breaches
of their fiduciary duty as directors except for (1) breaches of their duty
of loyalty to the Company or its stockholders, (2) acts or omissions not in
good faith or which involve intentional misconduct or knowing violations of
law, (3) under Section 174 of the General Corporation Law of the State of
Delaware (unlawful payment of dividends) or (4) transactions from which a
director derives improper personal benefit.
(d) The Company has entered into various acquisition agreements
pursuant to which the Seller therein may be required to indemnify the
officers, directors and controlling persons of the Company under certain
circumstances.
Item 16. Exhibits and Financial Statement Schedules.
See the Exhibit Index which is incorporated herein by reference.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high
and of the estimated maximum offering range may be reflected
in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if the registration statement is on Form S-3, Form S-8
or Form F-3, and the information required to be included in
a post-effective amendment by those paragraphs is contained
in periodic reports filed by the registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration
statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
3. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the provisions of the
registrant's articles of incorporation or by-laws or otherwise, the
registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will
be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Fort Lauderdale, State of
Florida, on this 13th day of September, 1996.
PARLUX FRAGRANCES, INC.
By: /s/ Ilia Lekach
-------------------------------
Name: Ilia Lekach
Title: Chairman of the Board and
Chief Executive Officer
Each person whose signature appears below hereby constitutes and
appoints Ilia Lekach and Frederick E. Purches, and each of them, the true
and lawful attorneys-in-fact and agents of the undersigned, with full power
of substitution and resubstitution, for and in the name, place and stead of
the undersigned and to file the same, with all exhibits thereto, in any and
all capabilities, to sign any and all amendments and any registration
statement filed pursuant to Rule 462(b) of the Securities Act of 1933, as
amended (including post-effective amendments thereto and other documents in
connection therewith), with the Securities and Exchange Commission, and
hereby grants to such attorneys-in-fact and agents, and each of them, full
power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, or
their or his substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in
their respective capacities on this 13th day of September, 1996.
Signature Title
_________ ______
/s/ Ilia Lekach
-------------------- Chairman of the Board and Chief Executive Officer
Ilia Lekach (Principal Executive Officer)
/s/ Zalman Lekach
--------------------- President, Chief Operating Officer, and a
Zalman Lekach Director
/s/ Frank A. Buttacavoli
-------------------------- Executive Vice President, Chief Financial
Frank A. Buttacavoli Officer, and a Director (Principal Financial
Officer and Principal Accounting Officer)
<PAGE>
/s/ Frederick E. Purches
-------------------------- Vice Chairman of the Board
Frederick E. Purches
/s/ Albert F. Vercillo
-------------------------- Director
Albert F. Vercillo
/s/ Mayi de la Vega
-------------------------- Director
Mayi de la Vega
/s/ Glenn Gopman
-------------------------- Director
Glenn Gopman
/s/ Richard Barrie
-------------------------- Director
Richard Barrie
<PAGE>
EXHIBIT INDEX
Exhibit Number Description of Documents Sequential Page No.
- -------------- ------------------------ -------------------
2.1 Asset Purchase Agreement, dated June 15,
1994, by and between Fred Hayman Beverly
Hills Inc. and the Company (incorporated
by reference to Exhibit 1 to the Company's
Current Report on Form 8-K, filed with the
Securities and Exchange Commission (the
"SEC") on June 15, 1994 and as amended on
June 29, 1994 and August 26, 1994)
2.2 Asset Purchase Agreement, dated November 2,
1994, by and between Sanofi Beaute, Inc.
("Sanofi") and the Company (incorporated
by reference to Exhibit 2.1 to the Company's
Current Report on Form 8-K, filed with the
SEC on January 11, 1995 (the "1995 Form 8-K"))
2.3 Asset Purchase Agreement, dated December 27,
1995, by and between Revlon Holdings Inc. and
the Company (incorporated by reference to the
Company's Current Report on Form 8-K, filed
with the SEC on January 11, 1996)
2.4 Asset Purchase Agreement, dated January 1,
1996, by and between Richard Barrie Fragrances,
Inc. and the Company +<F1> (incorporated by
reference to Exhibit No. 2.4 to the Form S-3
Registration Statement (File No. 333-8395),
declared effective on August 12, 1996 (the
"1996 S-3 Registration Statement"))
4.1 Certificate of Incorporation of the Company,
filed July 23, 1984 (incorporated by reference
to Exhibit No. 3.1 to the Form S-3 Registration
Statement (File No. 33-89806), declared
effective on March 13, 1995 (the "1995
S-3 Registration Statement"))
4.2 Amendment No. 1 to the Company's Certificate
of Incorporation, filed August 15, 1986
(incorporated by reference to Exhibit 3.2
to the 1995 S-3 Registration Statement)
4.3 Amendment No. 2 to the Company's Certificate
of Incorporation, filed October 15, 1988
(incorporated by reference to Exhibit 3.3
to the 1995 S-3 Registration Statement)
4.4 Certificate of Renewal to the Company's
Certificate of Incorporation, filed September
23, 1988 (incorporated by reference to
Exhibit 3.4 to the 1995 S-3 Registration
Statement)
4.5 Amendment No. 3 to the Company's Certificate
of Incorporation, filed November 8, 1991
(incorporated by reference to Exhibit 3.5
to the 1995 S-3 Registration Statement)
4.6 Amendment No. 4 to the Company's Certificate
of Incorporation, filed August 19, 1996.....
4.7 Bylaws of the Company (incorporated by
reference to Exhibit 3.6 to the 1995
S-3 Registration Statement)
4.8 7% Convertible Debenture, dated November 2, 1995,
between the Company and Gershon Partners, L.P.
(incorporated by reference to Exhibit
4.7 to the Company's Form 10-Q for the period
ended December 31, 1995 (the "Form 10-Q"))
4.9 7% Convertible Debenture, dated November 2,
1995, between the Company and Granite
Global Debt Fund, Ltd. (incorporated by
reference to Exhibit 4.8 to the Company's
Form 10-Q)
4.10 7% Convertible Debenture, dated December 5,
1995, between the Company and Master
Investments Corporation (incorporated by
reference to Exhibit 4.9 to the Company's
Form 10-Q)
4.11 7% Convertible Debenture, dated December 5,
1995, between the Company and Taryak, Inc.
(incorporated by reference to Exhibit 4.10
to the Company's Form 10-Q)
4.12 7% Convertible Debenture, dated December 6,
1995, between the Company and Privatinvest
Bank AG (incorporated by reference to
Exhibit 4.11 to the Company's Form 10-Q)
<PAGE>
4.13 7% Convertible Debenture, dated December 7,
1995, between the Company and Faisal Finance
(incorporated by reference to Exhibit 4.12
to the Company's Form 10-Q)
4.14 Security Agreement, dated December 27, 1994,
among Sanofi, the Company, and Parlux, Ltd.
("Ltd.") (incorporated by reference to
Exhibit 4.1 to the 1995 Form 8-K)
4.15 Reversionary Assignment and Assumption,
dated December 27, 1994, between Sanofi
and the Company (incorporated by
reference to Exhibit 4.2 to the 1995
Form 8-K)
4.16 Promissory Note, dated December 27, 1994,
made by the Company to the order of
Sanofi (incorporated by reference to
Exhibit 4.3 to the 1995 Form 8-K)
4.17 Loan and Security Agreement, dated December
29, 1994, between Ltd. and Finova Capital
Corporation ("Finova") (incorporated by
reference to Exhibit 4.4 to the 1995
Form 8-K)
4.18 Continuing Guaranty, dated December 29, 1994,
by the Company for the benefit of Finova
(incorporated by reference to Exhibit 4.5
to the 1995 Form 8-K)
4.19 Security Agreement, dated December 29, 1994,
between the Company and Finova (incorporated
by reference to Exhibit 4.6 to the 1995
Form 8-K)
4.20 Stock Pledge Agreement, dated December 29,
1994, by and between the Company and Finova
(incorporated by reference to Exhibit 4.7
to the 1995 Form 8-K)
4.21 Collateral Assignment of Trademarks and
Trademark Licenses (Security Agreement),
dated December 29, 1994, between the
Company and Finova (incorporated by
reference to Exhibit 4.8 to the 1995
Form 8-K)
<PAGE>
4.22 5% Convertible Debenture dated March 1, 1996
between the Company and Karle Limited
(incorporated by reference to Exhibit 4.16
to the Company's Form 10-K for the year
ended March 31, 1996 (the "1996 Form 10-K"))
4.23 5% Convertible Debenture dated March 4,
1996 between the Company and Newsun
Limited (incorporated by reference to
Exhibit 4.17 to the 1996 Form 10-K)
4.24 5% Convertible Debenture dated March 11,
1996 between the Company and Kempton
Investments Ltd. (incorporated by reference
to Exhibit 4.18 to the 1996 Form 10-K)
4.25 5% Convertible Debenture dated March 11,
1996 between the Company and Newsun
Limited (incorporated by reference to
Exhibit 4.19 to the 1996 Form 10-K)
4.26 5% Convertible Debenture dated April 16,
1996 between the Company and Kempton
Investments, Ltd. (incorporated by
reference to Exhibit 4.20 to the 1996
Form 10-K)
4.27 5% Convertible Debenture dated April 16,
1996 between the Company and Newsun
Limited (incorporated by reference to
Exhibit 4.21 to the 1996 Form 10-K)
4.28 5% Convertible Debenture dated May 12,
1996 between the Company and Newsun
Limited (incorporated by reference to
Exhibit 4.22 to the 1996 Form 10-K)
4.29 5% Convertible Debenture dated May 17,
1996 between the Company and GFL
Performance Fund, Ltd. (incorporated by
reference to Exhibit 4.23 to the 1996
Form 10-K)
4.30 5% Convertible Debenture dated July 2,
1996 between the Company and Newsun
Limited (incorporated by reference to
Exhibit 4.29 to the 1996 S-3 Registration
Statement)
<PAGE>
4.31 5% Convertible Debenture dated July 2, 1996
between the Company and Kempton Investments
Ltd. (incorporated by reference to Exhibit
4.30 to the 1996 S-3 Registration Statement)
5 Opinion of Mayer, Brown & Platt..............
23.1 Consent of Mayer, Brown & Platt (included
in the opinion filed as Exhibit 5)
23.2 Consent of Price Waterhouse LLP..............
24 Powers of Attorney (included on the signature
page in Part II of this Registration Statement)
=========================================================================
+<F1> The schedules and exhibits to this agreement have not been filed
pursuant to Item 601(b)(2) of Regulation S-K. Such schedules and
exhibits will be filed supplementally upon the request of the
Securities and Exchange Commission.
EXHIBIT 4.6
CERTIFICATE OF AMENDMENT
OF THE CERTIFICATE OF INCORPORATION
OF
PARLUX FRAGRANCES, INC.
UNDER SECTION 242 OF THE GENERAL CORPORATION LAW
* * * * * *
I, THE UNDERSIGNED, Frank A. Buttacavoli, being the Executive Vice
President, Chief Financial Officer and Secretary of Parlux Fragrances,
Inc. (the "Corporation"), hereby certify:
-----------
1. The name of the Corporation is Parlux Fragrances, Inc.
2. The certificate of incorporation of the Corporation is amended so that
the text of the first sentence of Article FOURTH is deleted in its entirety
and is replaced with the following:
Article FOURTH. The total number of shares of capital stock that the
Corporation is authorized to issue is 35,000,000 shares, consisting of:
(1) 30,000,000 shares of common stock, par value $.01 per share; and
(2) 5,000,000 shares of preferred stock, par value $.01 per share.
3. This amendment was authorized by the unanimous written consent of the
board of directors, followed by a vote in favor of the amendment by a
majority of the outstanding stock entitled to vote thereon and a majority
of the outstanding stock of each class entitled to vote thereon as a class,
in accordance with Section 242 of the General Corporation Law.
IN WITNESS WHEREOF, the undersigned has executed this certificate as of
the 12th day of August, 1996, and hereby affirms under penalty of perjury
that this certificate is the act and deed of the Corporation and that the
facts contained herein are true.
/s/ Frank A. Buttacavoli
------------------------
Frank A. Buttacavoli
Executive Vice President,
Chief Financial Officer and Secretary
EXHIBIT 5
September 13, 1996
Parlux Fragrances, Inc.
3725 S.W. 30th Avenue
Ft. Lauderdale, Florida 33312
Ladies and Gentlemen:
We are acting as special counsel to Parlux Fragrances, Inc. (the
"Company") in connection with the registration under the Securities Act of
1933, as amended, of 2,154,222 shares (the "Shares") of the Company's common
stock, $.01 par value per share (the "Common Stock"), to be offered by
certain selling stockholders of the Company (the "Selling Stockholders")
upon the terms and subject to the conditions set forth in the Company's
Registration Statement on Form S-3 covering the Shares (the "Registration
Statement") filed with the Securities and Exchange Commission.
In connection therewith, we have examined the Registration Statement and
such other documents and instruments as we have deemed necessary or
appropriate for the expression of the opinions contained herein.
We have assumed the authenticity and completeness of all records,
certificates and other instruments submitted to us as originals, the
conformity to original documents of all records, certificates and other
instruments submitted to us as copies, the authenticity and completeness
of the originals of those records, certificates and other instruments
submitted to us as copies and the correctness of all statements of fact
contained in all records, certificates and other instruments that we have
examined.
Based on and in reliance upon the foregoing, we are of the opinion that
the Shares proposed to be offered by the Selling Stockholders have been
duly and validly authorized for issuance and will be fully paid and
nonassessable shares of Common Stock upon the conversion of the Company's
5% convertible debentures in the aggregate principal amount of $10 million
held by the Selling Stockholders.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the reference to us under the caption "Legal
Matters."
Very truly yours,
Mayer, Brown & Platt
EXHIBIT 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
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We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated June 28, 1996 appearing on page F-2 of Parlux Fragrances, Inc.'s
Annual Report on Form 10-K for the year ended March 31, 1996. We also
consent to the reference to us under the heading "Experts" in such
Prospectus.
PRICE WATERHOUSE LLP
September 12, 1996
Miami, Florida
