PERFUMANIA INC, 10-K/A, 1999-05-28

PERFUMANIA INC
10-K/A, 1999-05-28
DRUG STORES AND PROPRIETARY STORES

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<PAGE> 1

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K/A

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)

FOR THE FISCAL YEAR ENDED JANUARY 30, 1999

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

COMMISSION FILE NUMBER 0-19714

PERFUMANIA, INC.

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

FLORIDA (STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)

65-0026340 (I.R.S. EMPLOYER IDENTIFICATION NUMBER)

11701 NW 101 ST. ROAD, MIAMI, FL (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

33178 (ZIP CODE)

(305) 889-1600 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

COMMON STOCK, $.01 PAR VALUE
(TITLE OF CLASS)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this form 10-K [ ].

As of April 15, 1999, the number of shares of the registrant's Common
Stock outstanding was 7,397,360. The aggregate market value of the Common Stock
held by non affiliates of the registrant as of April 15, 1999 was approximately
$10.8 million, based on the closing price of the Common Stock ($2.34) as
reported by the Nasdaq National Market on such date. For purposes of the
foregoing computation, all executive officers, directors and 5 percent
beneficial owners of the registrant are deemed to be affiliates. Such
determination should not be deemed to be an admission that such executive
officers, directors or 5 percent beneficial owners are, in fact, affiliates of
the registrant.

<PAGE> 2

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

EXECUTIVE OFFICERS AND DIRECTORS

The executive officers and directors of the Company are as follows:

Name Age Position
- ---- --- --------

Ilia Lekach 50 Chairman of the Board and Chief Executive Officer

Jerome Falic 35 President and Vice Chairman of the Board

Marc Finer 37 President of the Retail Division and Director

Donovan Chin 32 Chief Financial Officer, Secretary and Director

Claire Fair 39 Vice President of Human Resources

Robert Pliskin 75 Director

Carole Ann Taylor 53 Director

Dr. Horatio Groisman 46 Director

ILIA LEKACH is a co-founder of the Company and was the Company's Chief
Executive Officer and Chairman of the Board from its incorporation in 1988 until
April 1994. Mr. Lekach was re-appointed the Company's Chief Executive Officer
and Chairman of the Board on October 28, 1998. Mr. Lekach is also Chairman of
the Board and Chief Executive Officer of Parlux Fragrances, Inc. ("Parlux"), a
publicly traded manufacturer of fragrance and related products. In August 1996,
Mr. Lekach became an officer and director with L.Luria & Son, Inc., ("Luria"), a
publicly traded specialty discount retailer. On August 13, 1997, Luria filed for
relief under Chapter 11 of the Bankruptcy Code and has since been liquidated.
See "Certain Relationships and Related Transactions."

JEROME FALIC was appointed President on October 28, 1998. Mr. Falic has
been a Vice President of the Company since the Company's inception and a
Director of the Company since August 1994. Mr. Falic was appointed the Company's
Vice Chairman of the Board in September 1994.

MARC FINER has been the President of the Company's Retail Division
since March 1994 and a Director since August 1994. Mr. Finer was the President
of Parfums Expresso, Inc. and Parfums D'Arte, wholesale distributors of
fragrances in Puerto Rico, from their inception in August 1986 until March 1994.

DONOVAN CHIN was appointed Chief Financial Officer and Secretary of the
Company in February of 1999. Prior to this appointment, Mr. Chin served as
Corporate Controller of the Company from May 1995 to February 1999 and as
Assistant Corporate Controller from May 1993 to May 1995. Previously, Mr. Chin
was employed by Price Waterhouse LLP in its Miami audit practice.

CLAIRE FAIR was appointed Vice President of Human Resources in August
1996. From November 1993 to August 1996, she served as the Company's Director of
Human Resources. Previously, Ms. Fair was the Director of Employee Relations
with Sterling, Inc.

ROBERT PLISKIN was appointed a Director of the Company in October 1991.
Mr. Pliskin served as President of Longines Wittnauer Watch Company from 1971 to
1980 when he became President of the Seiko Time Corporation, a position he held
until 1987. In 1987 Mr. Pliskin became the President of Hattori

2
<PAGE> 3

Corporation of America, a distributor of watches and clocks, until his
retirement in 1993. Mr. Pliskin is a member of the Company's Audit Committee and
Compensation Committee.

CAROLE ANN TAYLOR was appointed a Director of the Company in June 1993.
From 1987 to 1998 Ms. Taylor was the owner and president of the Bayside Company
Store, a retail souvenir and logo store at Bayside Marketplace in Miami,
Florida. She was also a partner of Jardin Bresilien restaurant located at
Bayside Marketplace. Currently Ms. Taylor is the owner of Miami To Go, Inc., a
retail and wholesale logo and souvenir merchandising and silkscreening company.
She is also a partner is Miami Airport Duty Free Joint Venture with Greyhound
Leisure Services which owns and operates the 19 duty free stores at Miami
International Airport. Ms. Taylor is a Director of the Greater Miami Convention
& Visitors Bureau, the Academy of Travel and Tourism, the Omni Advisory Board,
the Performing Arts Trust Foundation and the Greater Miami Chamber of Commerce
Board of Trustees. Ms. Taylor is a member of the Company's Audit Committee,
Stock Option Committee and Compensation Committee.

DR. HORATIO GROISMAN was appointed a Director of the Company in March
1999. Dr. Groisman has been a practicing physician since 1981, specializing in
head and neck surgery, and currently has offices in Miami, Aventura and
Hollywood, Florida. Dr. Groisman is a member of the Company's Stock Option and
Compensation Committee.

The Company's officers are elected annually by the Board of Directors
and serve at the discretion of the Board. The Company's directors hold office
until the next annual meeting of shareholders and until their successors have
been duly elected and qualified.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than 10
percent of the Company's Common Stock, to file with the Securities and Exchange
Commission (the "SEC") initial reports of ownership and reports of changes in
ownership of Common Stock. Officers, directors and greater than 10 percent
shareholders are required by SEC regulation to furnish the Company with copies
of all Section 16(a) forms they file.

To the Company's knowledge, based solely on review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended January 30, 1999, all
Section 16(a) filing requirements applicable to its officers, directors and
greater than 10 percent beneficial owners were complied with except that one
report relating to one transaction was filed late by each Jerome Falic and
Robert Pliskin, respectively and two reports representing two transactions for
Claire Fair have not been filed as of May 28, 1999.

On October 28, 1999, the Company repriced the outstanding options
issued under the Company's 1991 Stock Option Plan. As of May 28, 1999 each of
the following individuals has not met the filing requirement with respect to
those options which were cancelled in connection with the repricing: Ilia
Lekach, Jerome Falic, Marc Finer, Claire Fair, Simon Falic, Ron Friedman, Robert
Pliskin, and Carole A. Taylor.

3
<PAGE> 4

ITEM 11. EXECUTIVE COMPENSATION

The following table sets forth compensation awarded to, earned by or
paid to the Company's (a)Chief Executive Officer, (b) the Company's four most
highly compensated executive officers other than the Chief Executive Officer
whose compensation exceeded $100,000 in fiscal 1998, for services rendered to
the Company during fiscal year 1998, 1997 and 1996 and (c) those individuals for
whom disclosures would have been provided but for the fact that those individual
were not serving as executive officers of the Company at the end of the fiscal
year. The Chief Executive Officer and such other executive officers are
sometimes hereafter collectively referred to as the "Named Executive Officers".

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>

LONG-TERM COMPENSATION
----------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
---------------------------------------------- --------------------- ----------
OTHER RESTRICTED
NAME AND FISCAL ANNUAL STOCK LTIP ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($)(1) AWARD(S) OPTIONS(#) PAYOUTS($) COMPENSATION($)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ilia Lekach (2) 1998 $0 $0 500,000 (3) $0 775,000(8) $0 $0
Chairman of the Board and
Chief Executive Officer

Jerome Falic (4) 1998 $259,034 $0 0 $0 334,500(8) $0 $0
President and 1997 $246,700 $0 0 $0 0 $0 $0
Vice Chairman of the Board 1996 $236,250 $61,000 0 $0 0 $0 $0

Marc Finer 1998 $200,401 $0 0 $0 60,000(8) $0 $0
President, Retail Division 1997 $183,912 $0 0 $0 50,000 $0 $0
1996 $169,962 $22,500 0 $0 0 $0 $0

Claire Fair 1998 $116,855 $0 0 $0 26,500(8) $0 $0
Vice President of Human 1997 $114,980 $0 0 $0 15,000 $0 $0
Resources 1996 $85,809 $0 0 $0 3,000 $0 $0

Simon Falic (5) 1998 $316,598 $0 0 $0 154,500(8) $0 1,303,588 (6)
1997 $304,813 $0 0 $0 0 $0 $0
1996 $287,163 $75,000 0 $0 0 $0 $0

Ron A. Friedman (7) 1998 $228,981 $0 0 $0 429,000(8) $0 826,232 (6)
1997 $246,700 $0 0 $0 0 $0 $0
1996 $236,250 $61,000 0 $0 0 $0 $0
</TABLE>

(1) The column for "Other Annual Compensation" does not include any amounts for
executive perquisites and any other personal benefits, such as the cost of
automobiles, life insurance and disability insurance because the aggregate
dollar amount per executive is less than 10% of his annual salary and
bonus.
(2) Ilia Lekach was re-appointed the Company's Chief Executive Officer and
Chairman of the Board on October 28, 1998.
(3) Amount reported represents consulting fees paid to Ilia Lekach during
Fiscal 1998 prior to his employment by the Company.
(4) Jerome Falic was appointed President following the resignation of Simon
Falic on January 29, 1999.
(5) Mr. Simon Falic resigned on January 29, 1999 at which time Mr. Falic served
the Company in the following capacities: President, Chief Financial
Officer, Chief Operations Officer, Treasurer and Secretary.
(6) Pursuant to and in accordance with the individual separation agreements
with the aforementioned Named Executive Officers, each shall receive the
amount indicated over a 36-month term. See "Separation Agreements" below.
(7) Mr. Friedman resigned on October 28, 1998 at which time he served the
Company in the following capacities: Chief Financial Officer, Chief
Operating Officer, Treasurer and Secretary.
(8) Includes options repriced effective October 28, 1998 in the following
amounts: Ilia Lekach (375,000); Jerome Falic (100,000); Marc Finer
(60,000); Claire Fair (21,500); Simon Falic (100,000); and Ron Friedman
(429,000).

<PAGE> 5

OPTION GRANTS TABLE

The following table sets forth certain information concerning grants of stock
options made during fiscal year 1998 to the Named Executive Officers.

INDIVIDUAL OPTION GRANTS IN FISCAL YEAR 1998
--------------------------------------------------------------------------------------------------------

POTENTIAL REALIZABLE
% OF TOTAL VALUE AT ASSUMED
OPTIONS ANNUAL RATES OF
GRANTED TO STOCK PRICE APPRECIATION
NUMBER OF EMPLOYEES EXERCISE FOR OPTION TERM
OPTIONS IN FISCAL PRICE PER EXPIRATION ------------------------------
NAME GRANTED 1998 (4) SHARE DATE 5% (1) 10% (1)
---- ---------------- -------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Ilia Lekach 400,000 21% $0.41 2008 $103,156 $260,760
375,000 (2) 20% $0.50 2008 $117,938 $298,125

Jerome Falic 34,500 (3) 4% $0.50 2008 $10,850 $27,428
200,000 25% $0.41 2008 $51,578 $130,380
100,000 (2) 5% $0.50 2008 $31,450 $79,500

Marc Finer 60,000 (2) 3% $0.50 2008 $18,870 $47,700

Claire Fair 5,000 (3) * $0.50 2008 $1,573 $3,975
21,500 (2) 1% $0.50 2008 $6,762 $17,093

Simon Falic 54,500 (3) 3% $0.50 2008 $71,140 $43,328
100,000 (2) 13% $0.50 2008 $31,450 $79,500
</TABLE>

* Indicates that amount is less than 1%.

(1) In accordance with the rules of the Securities and Exchange Commission, the
potential realizable values for such options shown in the table presented
above are based on assumed rates of stock price appreciation of 5% and 10%
compounded annually from the date the options were granted to their
expiration date. These assumed rates of appreciation do not represent the
Company's estimate or projection of the appreciation of shares of common
stock of the Company.
(2) The indicated options were initially granted prior to fiscal 1998 and were
subject to the Company's repricing effective October 28, 1998. Pursuant to
repricing, these options were cancelled and reissued with an exercise price
of $0.50.
(3) The indicated options were granted during fiscal 1998 prior to the
repricing and were subject to the Company's repricing. Pursuant to
repricing, these options were cancelled and reissued with an exercise price
of $0.50.
(4) Total stock option grants during fiscal 1998 were 1,926,750 of which
1,130,600 represents options cancelled and subsequently re-granted as part
of the repricing.

<PAGE> 6

STOCK OPTION EXERCISES AND YEAR-END OPTION VALUE TABLE

The following table sets forth certain information concerning option
exercises in fiscal year 1998 and the number of unexercised stock options held
by the Named Executive Officers as of January 30, 1999.

<TABLE>
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT FISCAL OPTIONS AT FISCAL
ACQUIRED YEAR-END(#) YEAR-END($)
ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE REALIZED UNEXERCISABLE UNEXERCISABLE
- ----------------------- -- ---------------- --- -------------- -- --------------------- --- -------------------
<S> <C> <C> <C> <C>
Ilia Lekach -- -- 775,000/0 $8,061,938/0
Jerome Falic -- -- 334,500/0 $2,439,386/0
Marc Finer 33,000 $120,375 27,000/0 $ 280,868/0
Claire Fair 9,500 $ 97,532 9,500/7,500 $98,824/78,019
Simon Falic -- -- 154,500/0 $1,607,186/0
Ron Friedman 429,000 $175,890 -- --
</TABLE>

DIRECTOR COMPENSATION

The Company pays each nonemployee director a $6,500 annual retainer and
reimburses such persons for their expenses in connection with their activities
as directors of the Company. In addition, nonemployee directors are eligible to
receive stock options under the Directors Stock Option Plan.

The Directors Stock Option Plan currently provides for an automatic
grant of an option to purchase 2,000 shares of Common Stock upon a person's
election as a director of the Company and an automatic grant of options to
purchase 4,000 shares of Common Stock upon such persons re-election as a
director of the Company, in both instances at an exercise price equal to the
fair market value of the Common Stock on the date of grant.

EMPLOYMENT AGREEMENTS

Effective February 1, 1999, the Company entered into 3-year employment
agreements with Ilia Lekach and Jerome Falic pursuant to which they will receive
an annual salary of $400,000 and $318,347, respectively, subject to
cost-of-living increases, or 5% if higher. The employment agreements provide
that Mr. Lekach and Mr. Falic will continue to receive their annual salary until
the expiration of the term of their employment agreements if their employment is
terminated by the Company for any reason other than death, disability or cause
(as defined in the employment agreements). The agreements contain a performance
bonus plan which provides for additional compensation and grant of stock
options, if the Company meets certain net income levels. The employment
agreements also prohibit the employees from directly or indirectly competing
with the Company during the term of their employment and for one year after
termination of employment except in the case of the Company's termination of
employment without cause.

Effective August 1996, the Company entered into 3-year employment
agreements with Marc Finer and Claire Fair, pursuant to which they will receive
an annual salary of $175,000 and $100,000, respectively, subject to
cost-of-living increases, or 5% if higher. The employment agreements provide
that Mr. Finer and Ms. Fair will continue to receive their salary until the
expiration of the term of the employment agreements if their employment is
terminated by the Company for any reason other than death, disability or cause
(as defined in the employment agreements). The agreements contain a performance
bonus plan which provides for additional compensation and grant of stock
options, if the Company meets certain net income levels. The employment
agreements also prohibit the employee from directly or indirectly competing with
the Company during the term of their employment and for one year

6
<PAGE> 7

after termination of employment except in the case of the Company's termination
of employment without cause.

SEPARATION AGREEMENTS

Pursuant to a separation agreement entered into between Ron Friedman
and the Company, upon the tendering of Mr. Friedman's resignation, the following
payments will be made pursuant to and in consideration of this agreement, such
payments being subject to applicable withholding taxes: a $826,232 severance
payment, of which $119,046 was paid through January 1999 and the balance of
which is payable in monthly installments of $20,136 from February through
October 1999 and $18,948 from November 1999 through November 2001. Mr. Friedman
will continue to receive health, dental and life insurance coverage, on the same
basis as prior to his resignation for an additional 36 months. Additionally, the
Company shall convert all previously granted options into shares of the
Company's common stock.

Pursuant to a separation agreement entered into between Simon Falic and
the Company, upon the tendering of Mr. Falic's resignation, the following
payments will be made pursuant to and in consideration of this agreement, such
payments being subject to applicable withholding taxes: a $1,303,588 severance
payment, of which $300,000 was paid in January 1999 and the balance of which is
payable in monthly installments of $26,529 during fiscal 1999, $27,855 during
fiscal 2000 and $29,248 during fiscal 2001. Mr. Falic will continue to receive
health, dental and life insurance coverage, on the same basis as prior to his
resignation for an additional 36 months.

7
<PAGE> 8

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

The following table sets forth, as of May 24, 1999, information with
respect to the beneficial ownership of the Company's Common Stock by (i) each
person known by the Company to beneficially own more than 5% of the outstanding
shares of Common Stock, (ii) each director of the Company, (iii) each Named
Executive Officer, and (iv) all directors and executive officers of the Company
as a group.

<TABLE>
<CAPTION>
COMMON STOCK BENEFICIALLY OWNED
-----------------------------------------------------
SHARES PERCENT
------------------ ----------
NAME AND ADDRESS OF BENEFICIAL OWNER (1)
<S> <C> <C>
Ilia Lekach 1,459,995(2)(3)(4) 19.7%
Simon Falic 683,050(2)(4) 9.2%
Rachmil Lekach 675,125(2)(4) 9.1%
Jerome Falic 923,230(3)(4) 12.5%
Ron A. Friedman - *
Marc Finer 27,000(4) *
Claire Fair 18,000(4) *
Robert Pliskin 4,000(4) *
Carole A. Taylor 3,800(4) *
Donovan Chin 9,500(4) *
Dr. Horatio Groisman 2,000(4) *
All directors and executive officers as a group 2,444,525 33.0%
(9 persons)
</TABLE>

*Less than 1%.

(1) The address of each of the beneficial owners identified is 11701 NW 101st
Road, Miami, Florida 33178, except for Simon Falic and Ron Friedman.
(2) Ilia Lekach, Simon Falic, Rachmil Lekach jointly own with their spouses the
shares set forth opposite their respective names.
(3) Includes 12,300 shares of Common Stock owned by Pacific Investment Group, a
corporation wholly owned by Mr. Lekach.
(4) Includes shares of Common Stock issuable upon the exercise of stock options
in the following amounts: Ilia Lekach (775,000); Rachmil Lekach (150,000);
Jerome Falic (334,500); Robert Pliskin (4,000); Marc Finer (27,000); Donovan
Chin (9,500); Dr. Horatio Groisman (2,000); Claire Fair (17,000); and Carole
A. Taylor (3,800).

<PAGE> 9

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

RELATIONSHIP WITH PARLUX. Parlux Fragrances, Inc. ("Parlux") is a
public company engaged in the manufacture of fragrances. Ilia Lekach, the
Company's Chairman of the Board and Chief Executive Officer, and one of the
Company's principal shareholders, is the Chairman of the Board of Parlux. During
fiscal year 1998, the Company purchased approximately $24.3 million of
merchandise from Parlux, representing approximately 27% of the Company's total
purchases. The Company believes that its purchases of merchandise from Parlux,
were, except for credit terms, on terms no less favorable to the Company than
could reasonably be obtained in arm's length transactions with independent third
parties.

RELATIONSHIP WITH L. LURIA & SON, INC. L. Luria & Son, Inc, ("Luria's")
is a public company that was a specialty discount retailer selling a broad line
of products. Ilia Lekach, the Company's Chairman of the Board and Chief
Executive Officer, and one of the Company's principal shareholders, was the
Chairman of the Board of Luria's. During fiscal year 1997, the Company sold
approximately $2.0 million of merchandise to Luria's, representing approximately
1% of the Company's total sales. The Company believes that its sales of
merchandise to Luria's, were, except for credit terms, on terms no less
favorable to the Company than could reasonably be obtained in arm's length
transactions with independent third parties. During August 1997, Luria's filed
for relief under Chapter 11 of the United States Bankruptcy Code. The Company is
an unsecured creditor of Luria's and in fiscal year 1997 the Company wrote off
receivables from Luria's in the amount of $1.2 million. The Company has been
characterized as an insider in the liquidating plan of reorganization filed on
April 6, 1998 by Luria's in the United States Bankruptcy Court, Southern
District of Florida. In October 1998, the committee of unsecured creditors in
Luria's bankruptcy proceedings filed a complaint with the United States
Bankruptcy Court, Southern District of Florida, to recover substantial funds
from the Company. The complaint alleges that Luria's made preference payments,
as defined by the Bankruptcy Court, to the Company and seeks recovery of said
preference payments, as well as disallowing any and all claims of the Company
against Luria's until full payment of the preference payments have been made.
Management cannot presently predict the outcome of these matters, although
management believes, upon the advice of legal counsel, that the Company would
have meritorious defenses and that the ultimate resolution of these matters
should not have a materially adverse effect on the Company's financial position
or result of operations.

RELATED PARTY INDEBTEDNESS. From time to time the Company has borrowed
money for working capital purposes from its principal shareholders and executive
officers and members of their immediate families. The highest aggregate amounts
of the Company's indebtedness to such persons during fiscal year 1998, amount
outstanding at January 30, 1999, the maturity date of such indebtedness and the
interest rate payable by the Company at January 30, 1999, were as set forth in
the following table:

HIGHEST AMOUNT AMOUNT ANNUAL
OUTSTANDING OUTSTANDING AT PAYMENT INTEREST
DURING FISCAL YEAR JANUARY 30, 1999 DATE RATE
-------------------- -------------------- ------------------ --------------
<S> <C> <C> <C> <C>
Israel Friedman (1) $786,483 $0 November 1998 Prime plus 2%
</TABLE>

(1) Father of Ron A. Friedman, the Company's previous Chief Financial Officer,
Chief Operating Officer and Secretary.

As of January 30, 1999, Ilia Lekach was indebted to the Company pursuant to an
unsecured note, in the amount of $457,243 issued in connection with his purchase
of a condominium from the Company in October 1991. The note accrues interest at
the rate of 9.5% and matures on December 31, 2000.

Prior to becoming an employed as the Company's Chief Executive Officer effective
February 1, 1999, Ilia Lekach provided consulting services to the Company. The
total consulting fees paid to this Mr. Lekach during 1998 was $500,000.

<PAGE> 10

(3) Exhibits

Page
Number or
Incorporated by
Exhibit Description Reference From
- ------- ----------- ---------------
<S> <C> <C>
3.1 Amended and Restated Articles of Incorporation (1)

3.2 Bylaws (2)

4.1 Warrant Agreement between the Company and Josephthal, Lyon & Ross Incorporated (3)

10.1 Executive Compensation Plans and Arrangements (5)
(a) Employment Agreement, dated as of February 1, 1995, between the Company
and Simon Falic

(b) Employment Agreement, dated as of February 1, 1995, between the Company and
Jerome Falic

(d) Consulting Agreement, dated as of January 1, 1994, between the Company and
Rachmil Lekach

(e) Consulting Agreement, dated as of May 2, 1995, between the Company and
Ilia Lekach

10.3 Amendments to the Loan and Security Agreements between the Company and

LaSalle National Bank dated July 29, 1994, and September 30, 1994 (5)

10.4 Amendments to the Loan and Security Agreements between the Company and LaSalle
National Bank dated March 29, 1996 (6)

10.5 1991 Stock Option Plan, as amended (6)

10.6 1992 Directors Stock Option Plan, as amended (6)

10.7 Regulation S 5% Convertible Debentures Agreement (6)

10.8 Regulation S Stock Subscription Agreement (6)

10.9 Amendments to the Loan and Security Agreements between LaSalle
National Bank dated April 16, 1997 (7)

10.10 Executive Employment Agreements and Separation Agreements (10)
(a) Employment Agreement, dated as of June 21, 1996, between the Company
and Claire Fair

(b) Employment Agreement, dated as of August 11, 1997, between the Company
and Marc Finer

(d) Employment Agreement, dated as of February 1, 1999, between the Company
and Ilia Lekach

(e) Separation Agreement, dated December 1, 1998, between the Company and
Ron Friedman

(f) Separation Agreement, dated January 29, 1999, between the Company and
Simon Falic

21.1 Subsidiaries of the Registrant (6)

23.1 Consent of PricewaterhouseCoopers LLP (9)

27.1 Financial Data Schedule (9)
</TABLE>

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<PAGE> 11

(1) Incorporated by reference to the exhibit of the same description filed
with the Company's 1993 Form 10-K (filed April 28, 1994).

(2) Incorporated by reference to the exhibit of the same description filed
with the Company's Registration Statement on Form S-1 (No. 33-46833).

(3) Incorporated by reference to the exhibit of the same description filed
with the Company's Registration Statement on Form S-1 (No. 33-43556).

(4) Incorporated by reference to the exhibit of the same description filed
with the Company's Registration Statement on Form S-8 (filed October
13, 1994).

(5) Incorporated by reference to the exhibit of the same description filed
with the Company's 1994 Form 10-K (filed April 20, 1995).

(6) Incorporated by reference to the exhibit of the same description filed
with the Company's 1995 Form 10-K (filed April 26, 1996).

(7) Incorporated by reference to the exhibit of the same description filed
with the Company's 1996 Form 10-K (filed May 2, 1997)

(8) Incorporated by reference to the exhibit of the same description filed
with the Company's 1997 Form 10-K (filed May 28, 1998)

(9) Incorporated by reference to the exhibit of the same description filed
with the Company's 1998 Form 10-K (filed April 30, 1999).

(10) Filed herewith

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<PAGE> 12

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

May 28, 1999 PERFUMANIA, INC.

By: /s/ Ilia Lekach
------------------------------------
Ilia Lekach, Chairman of the Board
and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

Signature Title Date
- --------- ----- ----

<S> <C> <C>
/s/ Ilia Lekach Chairman of the Board and May 28, 1999
- ------------------------------- Chief Executive Officer
Ilia Lekach

/s/ Jerome Falic President and Vice Chairman May 28, 1999
- ------------------------------- of the Board
Jerome Falic

/s/ Donovan Chin Chief Financial Officer May 28, 1999
- ------------------------------- and Director
Donovan Chin

/s/ Marc Finer President of the Retail Division May 28, 1999
- ------------------------------- and Director
Marc Finer

/s/ Robert Pliskin Director May 28, 1999
- -------------------------------
Robert Pliskin

/s/ Carole Ann Taylor Director May 28, 1999
- -------------------------------
Carole Ann Taylor

/s/ Horacio Groisman, M.D. Director May 28, 1999
- -------------------------------
Horacio Groisman, M.D.

</TABLE>

<PAGE> 1
Exhibit 10.10(a)

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into, and
shall be binding this 21st day of June, 1996, by and between the Perfumania,
Inc., a Florida corporation ("Employer") and Claire Fair ("Executive").

W I T N E S S E T H:

WHEREAS, Employer, is engaged in the business of selling perfumes and
cosmetics on a discount basis; and

WHEREAS, Executive is experienced in the management and operation of
such business and is professionally qualified to perform such services for the
Employer; and

WHEREAS, Employer desires to retain the services of the Executive; and

WHEREAS, Executive is desirous of obtaining employment with the
Employer on the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual promises set forth
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, Employer and Executive agree as follows:

1. Recitals, Representations and Warranties. The foregoing recitals are
true and correct and are incorporated herein by this reference. In addition to
the foregoing recitals, Executive represents that she has not been convicted of
any crime, has not been declared insolvent and has not filed for bankruptcy. In
addition to the foregoing recitals, Employer represents and warrants that the
individual executing this Agreement has authority to do so.

2. Employment. In exchange for the Compensation (as hereinafter
defined) and subject to the other terms and conditions hereinafter set forth,
Employer hereby employs Executive, as its Vice President - Human Resources, to
perform the Executive Duties (as hereinafter defined) and Executive hereby
accepts such employment.

3. Duties. The Executive shall perform such executive and
administrative services as is expected from a Human Resource Vice President.

a. Performance of Executive Duties & Adherence to Policies.
During the Term, Executive shall render the Executive Duties exclusively for
Employer, shall perform the Executive Duties to the best of her ability and
shall operate Employer's business efficiently and profitably adhering, at all
times, to the policies of the Employer and Perfumania.

4. Term. The term of the Agreement shall commence on June 21, 1996 and
shall expire on August 11, 2000.

5. Compensation. In consideration of and as compensation in full for
Executive's performance of the Executive Duties hereunder, Employer agrees to
compensate Executive as follows:

a. Salary. Beginning on August 11, 1996 and through the
term of this Agreement, Employer shall pay Executive a gross annual salary of
One-Hundred Thousand Dollars ($100,000)("Salary"). Such Salary shall be paid by
Employer in accordance with Employer's regular payroll practices. Employer shall
be entitled to deduct or withhold from all Salary payable hereunder all amounts
required to be deducted or withheld from same pursuant to state or federal law.

b. Performance Bonus Plan. The Executive shall be
entitled to a bonus equal to:
(1) 5% of Executive's salary to the extent that Net
Income of the Company shall exceed $2,000,000.

1
<PAGE> 2

(2) a) An additional 1/2% of Executive's salary for
each increment of $100,000 in the Company's Net Income over $2,000,000 up to
$6,000,000, and b) to the extent that the Company's net income exceeds
$6,000,000, executive shall receive a bonus of 30% of salary plus 3/4% of
executive's salary for each $100,000 increment over $6,000,000.

(3) For the purpose of this paragraph, Net Income is
defined as net income reported in S.E.C. Form 10-K (after taking into account
extraordinary income or loss).

(4) Withholding. Employer shall be entitled to deduct
or withhold from all bonus payments paid pursuant to this Paragraph 5.b. all
amounts required to be deducted or withheld from same pursuant to state or
federal law.

c. Stock Option Plan:

(1) Executive shall be granted 5,000 options, at a
price equal to the price as of August 11, 1996. Such options shall vest 1/3 each
after each 12 month period from date of contract.

(2) To the extent Net Income exceeds $2,000,000,
Executive shall be granted an additional 2,000 options.

d. Expense Reimbursement & Insurance. Executive shall be
reimbursed for business expenses and receive full health, disability and life
insurance.

e. Car allowance. Executive shall receive, on a monthly
basis, a $500 car allowance.

f. Vacation. Employee shall be entitled to take up to
fifteen (15) working days of vacation per twelve (12) month period during the
Term.

g. Increases In Salary, Additional Bonuses & Additional
Options. On August 11, 1997, 1998 and 1999, Executive's salary from the previous
year shall be increased by the higher of 5% or C.P.I.

6. Early Termination of Contract.

To the extent that the Company shall decide to terminate this
agreement prior to August 11, 1999, Executive shall be entitled to compensation
as defined in paragraph 5 (including salary, bonus, stock plan, 401K and
insurance coverage) as if Executive was still employed and this agreement was in
full effect. A termination of this Agreement shall be deemed to happen upon a
change in Executive's duties and/or title and/or to the extent that providing
such services would require a move from South Florida.

7. Miscellaneous.

a. Notices. All notices, demands or other communications given
hereunder shall be in writing and shall be deemed to have been duly given only
upon hand delivery thereof or upon the first business day after mailing by
United States registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

To Employer: Perfumania, Inc.
11701 N.W. 101 Road
Miami, Florida 33178

To Executive: Claire Fair
3330 N. 37th Street
Hollywood, FL 33021

2
<PAGE> 3

or to such other address or such other person as any party shall designate, in
writing, to the other for such purposes and in the manner hereinabove set forth.

b. Accuracy of Statements. No representation or warranty
contained in this Agreement, and no statement delivered or information supplied
to any party pursuant hereto, contains an untrue statement of material fact or
omits to state a material fact necessary in order to make the statements or
information contained herein or therein not misleading. The representations and
warranties made in this Agreement will be continued and will remain true and
complete in all material respects and will survive the execution of the
transactions contemplated hereby.

c. Entire Agreement. This Agreement sets forth all the
promises, covenants, agreements, conditions and understandings between the
parties hereto, and supersedes all prior and contemporaneous agreements,
understandings, inducements or conditions, expressed or implied, oral or
written, except as herein contained.

d. Binding Effect; Survival & No Assignment. This Agreement
shall be binding upon the parties hereto, their heirs, administrators,
successors and assigns. This Agreement shall survive and remain effective during
any bankruptcy of the Employer. Executive may not assign or transfer his
interest herein, or delegate his Executive Duties hereunder, without the written
consent of Employer. Any assignment or delegation of duties in violation of this
provision shall be null and void.

e. Amendment. The parties hereby irrevocably agree that no
attempted amendment, modification, termination, discharge or change
(collectively, "Amendment") of this Agreement shall be valid and effective,
unless the parties shall agree in writing to such Amendment.

f. No Waiver. No waiver of any provision of this Agreement
shall be effective unless it is in writing and signed by the party against whom
it is asserted, and any such written waiver shall only be applicable to the
specific instance to which it relates and shall not be deemed to be a continuing
or future waiver.

g. Gender and Use of Singular and Plural. All pronouns herein
shall be deemed to refer to the masculine, feminine, neuter, singular or plural,
as the identity of the party or parties, or their personal representatives,
successors and assigns may require.

h. Counterparts. This Agreement and any amendments may be
executed in one or more counterparts, each of which shall be deemed an original,
but all of which together will constitute one and the same instrument.

i. Headings. The article and section headings contained in
this Agreement are inserted for convenience only and shall not affect in any way
the meaning or interpretation of the Agreement.

j. Arbitration & Governing Law. Any controversy, claim or
dispute arising out of or relating to this Agreement and/or Executive's
employment with Employer shall be settled by arbitration in accordance with
applicable rules of the American Arbitration Association and judgment upon the
award rendered by the arbitrator may be entered in any court having jurisdiction
thereof. This arbitration clause shall be exactly as the arbitration clause
signed by all Perfumania employees. This Agreement shall be construed in
accordance with the laws of the State of Florida and any proceeding arising
between the parties in any manner pertaining or related to this Agreement shall,
to the extent permitted by law, be held in Dade County, Florida.

k. Further Assurances. The parties hereto will execute and
deliver such further instruments and do such further acts and things as may be
reasonably required to carry out the intent and purposes of this Agreement.

l. No Third Party Beneficiary. This Agreement is made solely
and specifically among and for the benefit of the parties hereto, and their
respective successors and

3
<PAGE> 4

assigns subject to the express provisions hereof relating to successors and
assigns, and no other person shall have any rights, interest or claims hereunder
or be entitled to any benefits under or on account of this Agreement as a
third-party beneficiary or otherwise.

m. Severability. This Agreement is intended to be performed in
accordance with, and only to the extent permitted by, all applicable laws,
ordinances, rules, and regulations of the jurisdiction in which the parties do
business. If any provision of this Agreement, or the application thereof to any
person or circumstances shall, for any reason or to any extent, be invalid or
unenforceable, the remainder of this Agreement and the application of such
provision to other persons or circumstances shall not be affected thereby, but
rather shall be enforced to the greatest extent permitted by law.

n. Attorneys' Fees. In connection with any proceeding arising
out of this Agreement, the prevailing party shall be entitled to recover costs
and attorneys' fees, through all appeals, from the other party.

o. Renegotiation. To the extent that Employer will make a
significant acquisition or merger, this Agreement shall be renegotiated at terms
no less favorable than this Agreement.

IN WITNESS WHEREOF, Employer and Executive have executed this Agreement
as of the date first above written.

WITNESSES: EMPLOYER:

PERFUMANIA, INC.

By:

Ron A. Friedman, Chief Operating Officer

EXECUTIVE:

By:

Claire Fair

<PAGE> 1
Exhibit 10.10(b)

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into, and
shall be binding this 11th day of August, 1997, by and between the Perfumania,
Inc., a Florida corporation ("Employer") and Marc Finer("Executive").

W I T N E S S E T H:

WHEREAS, Employer, is engaged in the business of selling perfumes and
cosmetics on a discount basis; and

WHEREAS, Executive is experienced in the management and operation of
such business and is professionally qualified to perform such services for the
Employer; and

WHEREAS, Employer desires to retain the services of the Executive; and

WHEREAS, Executive is desirous of obtaining employment with the
Employer on the terms and conditions set forth herein.

1. Recitals, Representations and Warranties. The foregoing recitals are
true and correct and are incorporated herein by this reference. In addition to
the foregoing recitals, Executive represents that he has not been convicted of
any crime, has not been declared insolvent and has not filed for bankruptcy. In
addition to the foregoing recitals, Employer represents and warrants that the
individual executing this Agreement has authority to do so.

2. Employment. In exchange for the Compensation (as hereinafter
defined) and subject to the other terms and conditions hereinafter set forth,
Employer hereby employs Executive, as its President - Retail Division, to
perform the Executive Duties (as hereinafter defined) and Executive hereby
accepts such employment.

3. Duties. The Executive shall perform such executive and
administrative services in the running of the business of the Employer as the
Employer's Board of Directors and/or the President/CEO may assign to the
Executive during the Term (as hereinafter defined).

a. Performance of Executive Duties & Adherence to Policies.
During the Term, Executive shall render the Executive Duties exclusively for
Employer, shall perform the Executive Duties to the best of his ability and
shall operate Employer's business efficiently and profitably adhering, at all
times, to the policies of the Employer and Perfumania.

4. Term. The term of the Agreement shall commence on August 11, 1997
and shall expire on August 11, 2000.

5. Compensation. In consideration of and as compensation in full for
Executive's performance of the Executive Duties hereunder, Employer agrees to
compensate Executive as follows:

a. Salary. Beginning on August 11, 1997 and through the
term of this Agreement, Employer shall pay Executive a gross annual salary of
One-Hundred Seventy-FiveThousand Dollars ($183,750)("Salary"). Such Salary shall
be paid by Employer in accordance with Employer's regular payroll practices.
Employer shall be entitled to deduct or withhold from all Salary payable
hereunder all amounts required to be deducted or withheld from same pursuant to
state or federal law.

b. Performance Bonus Plan. The Executive shall be
entitled to a bonus equal to:

(1) 5% of Executive's salary to the extent that
Planned Net Income of the Retail Division, as well as the home office, will be
met.

1
<PAGE> 2

(2) a) An additional 3/4% of Executive's salary for
each increment of $100,000 (net of 40% tax) above the Company's Planned Net
Income (Retail Division and home office). Actual Net Income will be reduced to
the extent Wholesale and Interest Expense (net of 40% tax) do not meet their
budgets.

(3) Withholding. Employer shall be entitled to deduct
or withhold from all bonus payments paid pursuant to this Paragraph 5.b. all
amounts required to be deducted or withheld from same pursuant to state or
federal law.

c. Stock Option Plan:

(1) Executive shall be granted 50,000 options, at a
price equal to the price as of August 11, 1996. Such options shall vest 1/3 each
after each 12 month period from date of contract.

(2) At the discretion of the CEO, Executive may be
granted additional options.

d. Expense Reimbursement & Insurance. Executive shall be
reimbursed for business expenses and receive full health, disability and life
insurance.

e. Car allowance. Executive shall receive, on a monthly
basis, a $500 car allowance.

f. Vacation. Employee shall be entitled to take up to
fifteen (15) working days of vacation per twelve (12) month period during the
Term.

g. Increases In Salary, Additional Bonuses & Additional
Options. On August 11, 1998 and August 11, 1999, Executive's salary from the
previous year shall be increased by the higher of 5% or C.P.I.

6. Early Termination of Contract.

To the extent that the Company shall decide to terminate this
agreement prior to August 11th, 2000 , Executive shall be entitled to
compensation as defined in paragraph 5 (including salary, bonus, stock plan,
401K and insurance coverage) as if Executive was still employed and this
agreement was in full effect.

7. Miscellaneous.

To Employer: Perfumania, Inc.
11701 N.W. 101 Road
Miami, Florida 33178
Attention: Ron A. Friedman

To Executive: Marc Finer
19300 N. 10th Street
Pembroke Pines, FL 33029

or to such other address or such other person as any party shall designate, in
writing, to the other for such purposes and in the manner hereinabove set forth.

2
<PAGE> 3

i. Headings. The article and section headings contained in
this Agreement are inserted for convenience only and shall not affect in any way
the meaning or interpretation of the Agreement.

l. No Third Party Beneficiary. This Agreement is made solely
and specifically among and for the benefit of the parties hereto, and their
respective successors and assigns subject to the express provisions hereof
relating to successors and assigns, and no other person shall have any rights,
interest or claims hereunder or be entitled to any benefits under or on account
of this Agreement as a third-party beneficiary or otherwise.

3
<PAGE> 4

o. Renegotiation. To the extent that Employer will make a
significant acquisition or merger, this Agreement shall be renegotiated at terms
no less favorable than this Agreement.

IN WITNESS WHEREOF, Employer and Executive have executed this Agreement
as of the date first above written.

WITNESSES: EMPLOYER:

PERFUMANIA, INC.

By:

Ron A. Friedman, Chief Operating Officer

EXECUTIVE:

By:

Marc Finer

<PAGE> 1
Exhibit 10.10(c)

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into this
1st day of February, 1999, by and between the Perfumania, Inc., a Florida
corporation ("Employer") and Jerome Falic ("Executive").

W I T N E S S E T H:

WHEREAS, Employer, is engaged in the business of selling perfumes and
cosmetics on a discount basis; and

WHEREAS, Executive is experienced in the management and operation of
such business and is professionally qualified to perform such services for the
Employer; and

WHEREAS, Employer desires to retain the services of the Executive; and

WHEREAS, Executive is desirous of obtaining employment with the
Employer on the terms and conditions set forth herein.

1. Recitals, Representations and Warranties. The foregoing recitals are
true and correct and are incorporated herein by this reference. In addition to
the foregoing recitals, Executive represents that he has not been convicted of
any crime, has not been declared insolvent and has not filed for bankruptcy. In
addition to the foregoing recitals, Employer represents and warrants that the
individual executing this Agreement has authority to do so.

2. Employment. In exchange for the Compensation (as hereinafter
defined) and subject to the other terms and conditions hereinafter set forth,
Employer hereby employs Executive, as its President to perform the Executive
Duties (as hereinafter defined) and Executive hereby accepts such employment.

3. Duties. The Executive shall perform such executive and
administrative services in the running of the business of the Employer as the
Employer's Board of Directors and/or the Chairman of Perfumania may assign to
the Executive during the Term (as hereinafter defined). During the Term (as
hereinafter defined), the Executive shall report directly to Perfumania's
Chairman.

a. Performance of Executive Duties & Adherence to Policies.
During the Term, Executive shall render the Executive Duties exclusively for
Employer, shall perform the Executive Duties to the best of his ability and
shall operate Employer's business efficiently and profitably adhering, at all
times, to the policies of the Employer and Perfumania.

<PAGE> 2

4. Term. The term of the Agreement shall commence on February 1, 1999
and shall expire on January 31, 2002.

5. Compensation. In consideration of and as compensation in full for
Executive's performance of the Executive Duties hereunder, Employer agrees to
compensate Executive as follows:

a. Salary. During the Term of this Agreement, Employer
shall pay Executive a gross annual salary of Three Hundred Eighteen Thousand
Three Hundred Forty-Seven Dollars ($318,347)("Salary"). Such Salary shall be
paid by Employer in accordance with Employer's regular payroll practices.
Employer shall be entitled to deduct or withhold from all Salary payable
hereunder all amounts required to be deducted or withheld from same pursuant to
state or federal law.

b. Performance Bonus Plan.

The Executive shall be entitled to a bonus equal to:

(1) 10% of Executive's salary to the extent that Net
Income of the Company shall exceed $1,000,000.

(2) a) An additional 1% of Executive's salary for
each increment of $100,000 in the Company's Net Income over $1,000,000 up to
$6,000,000, and b) to the extent that the Company's net income exceeds
$6,000,000, executive shall receive a bonus of 65% of salary plus 1.5% of
executive's salary for each $100,000 increment over $6,000,000.

(3) For the purpose of this paragraph, Net Income is
defined as net income reported in S.E.C. Form 10-K (after taking into account
extraordinary income or loss).

c. Stock Option Plan:

(1) Executive should be granted 15,000 options to the
extent that Net Income exceeds $2,000,000, and an additional 750 options for
each $100,000 increments in Net Income over $2,000,000 up to $4,000,000, and

(2) To the extent Net Income exceeds $4,000,000,
Executive shall be granted 30,000 options and 500 options for each $100,000
increments in Net Income over $4,000,000 up to $7,000,000.

<PAGE> 3

d. 401k Plan, Expense Reimbursement & Insurance. Executive
shall be entitled to participate in the Employer's 401(k) plan, be reimbursed
for business expenses and receive full health, disability and life insurance.

e. Vacation. Employee shall be entitled to take up to twenty
(20) working days of vacation per twelve (12) month period during the Term.

f. Automobile Allowance. Employee shall be entitled to a
monthly automobile allowance of $750.

g. Cellular Telephones. Employee shall be entitled to the use
of two cellular telephones, one to be installed in an automobile designated by
employee and one portable cellular phone.

h. Increases In Salary, Additional Bonuses & Additional
Options. Each year after the initial term, Executive's salary shall be increased
by the higher of 5% or C.P.I.

6. Early Termination of Contract.

To the extent that the Company shall decide to terminate this
agreement prior to December 31, 2001, Executive shall be entitled to
compensation as defined in paragraph 5 (including salary, bonus, stock plan,
401K and insurance coverage, automobile allowance and cellular telephones) as if
Executive was still employed and this agreement was in full effect.

7. Miscellaneous.

To Employer: Perfumania, Inc.
11701 N.W. 101 Road
Miami, Florida 33178

To Executive: Jerome Falic
209 Bal Bay Drive
Bal Harbour, Florida 33154

or to such other address or such other person as any party shall designate, in
writing, to the other for such purposes and in the manner hereinabove set forth.

b. Accuracy of Statements. No representation or warranty
contained

<PAGE> 4

in this Agreement, and no statement delivered or information supplied to any
party pursuant hereto, contains an untrue statement of material fact or omits to
state a material fact necessary in order to make the statements or information
contained herein or therein not misleading. The representations and warranties
made in this Agreement will be continued and will remain true and complete in
all material respects and will survive the execution of the transactions
contemplated hereby.

i. Headings. The article and section headings contained in
this Agreement are inserted for convenience only and shall not affect in any way
the meaning or interpretation of the Agreement.

<PAGE> 5

shall be exactly as the arbitration clause signed by all Perfumania employees.
This Agreement shall be construed in accordance with the laws of the State of
Florida and any proceeding arising between the parties in any manner pertaining
or related to this Agreement shall, to the extent permitted by law, be held in
Dade County, Florida.

o. Renegotiation. To the extent that Employer will make a
significant acquisition or merger, this Agreement shall be renegotiated at terms
no less favorable than this Agreement.

p. Change in control. To the extent that Employer undergoes a
significant change in control or is acquired, all items under Section 5,
Compensation, shall be doubled for the duration of the term of this Agreement.
In addition, Executive will be granted 5,000 stock options for each remaining
month from the date of the change in control through January 31, 2002. These
stock options shall be fully vested and shall be granted at an exercise price
equal to the closing market price of the Company's stock on the day prior to any
press release announcing a change in control.

<PAGE> 6

IN WITNESS WHEREOF, Employer and Executive have executed this Agreement
as of the date first above written.

WITNESSES: EMPLOYER:

PERFUMANIA, INC.

By:

EXECUTIVE:

By:

Jerome Falic

<PAGE> 1
Exhibit 10.10(d)

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into this
1st day of February, 1999, by and between the Perfumania, Inc., a Florida
corporation ("Employer") and Ilia Lekach ("Executive").

W I T N E S S E T H:

WHEREAS, Employer, is engaged in the business of selling perfumes and
cosmetics on a discount basis; and

WHEREAS, Executive is experienced in the management and operation of
such business and is professionally qualified to perform such services for the
Employer; and

WHEREAS, Employer desires to retain the services of the Executive; and

WHEREAS, Executive is desirous of obtaining employment with the
Employer on the terms and conditions set forth herein.

1. Recitals, Representations and Warranties. The foregoing recitals are
true and correct and are incorporated herein by this reference. In addition to
the foregoing recitals, Executive represents that he has not been convicted of
any crime, has not been declared insolvent and has not filed for bankruptcy. In
addition to the foregoing recitals, Employer represents and warrants that the
individual executing this Agreement has authority to do so.

2. Employment. In exchange for the Compensation (as hereinafter
defined) and subject to the other terms and conditions hereinafter set forth,
Employer hereby employs Executive, as its Chief Executive Officer and Chairman
of the Board, to perform the Executive Duties (as hereinafter defined) and
Executive hereby accepts such employment.

3. Duties. The Executive shall perform such executive and
administrative services in the running of the business of the Employer as the
Employer's Board of Directors may assign to the Executive during the Term (as
hereinafter defined). During the Term (as hereinafter defined), the Executive
shall report directly to Perfumania's Board of Directors.

a. Performance of Executive Duties & Adherence to Policies.
During the Term, Executive shall render the Executive Duties exclusively for
Employer, shall perform the Executive Duties to the best of his ability and
shall operate Employer's business efficiently and profitably adhering, at all
times, to the policies of the Employer and Perfumania.

4. Term. The term of the Agreement shall commence on February 1, 1999
and shall expire on January 31, 2002.

5. Compensation. In consideration of and as compensation in full for
Executive's performance of the Executive Duties hereunder, Employer agrees to
compensate Executive as follows:

a. Signing Bonus. Employer shall pay Executive a signing bonus
of $500,000 as of January 30, 1999. Such signing bonus shall be in consideration
of and as compensation for services provided to Employer in fiscal year 1998.

b. Salary. During the Term of this Agreement, Employer shall
pay Executive a gross annual salary of Four Hundred Thousand Dollars
($400,000)("Salary"). Such Salary shall be paid by Employer in accordance with
Employer's regular payroll practices. Employer shall be entitled to deduct or
withhold from all Salary payable hereunder all amounts required to be deducted
or withheld from same pursuant to state or federal law.

1
<PAGE> 2

c. Performance Bonus Plan.

The Executive shall be entitled to a bonus equal to:

(1) 20% of Executive's salary to the extent that Net
Income of the Company shall exceed $1,000,000.

(2) a) An additional 2% of Executive's salary for
each increment of $100,000 in the Company's Net Income over $1,000,000 up to
$6,000,000, and b) to the extent that the Company's net income exceeds
$6,000,000, executive shall receive a bonus of 130% of salary plus 3% of
executive's salary for each $100,000 increment over $6,000,000.

(3) For the purpose of this paragraph, Net Income is
defined as net income reported in S.E.C. Form 10-K (after taking into account
extraordinary income or loss).

d. 401k Plan, Expense Reimbursement & Insurance.
Executive shall be entitled to participate in the Employer's 401(k) plan, be
reimbursed for business expenses and receive full health, disability and life
insurance.

e. Vacation. Employee shall be entitled to take up to
twenty (20) working days of vacation per twelve (12) month period during the
Term.

f. Increases In Salary, Additional Bonuses & Additional
Options. Each year after the initial term, Executive's salary shall be increased
by the higher of 5% or C.P.I.

6. Early Termination of Contract.

To the extent that the Company shall decide to terminate this
agreement prior to December 31, 2001, Executive shall be entitled to
compensation as defined in paragraph 5 (including salary, bonus, stock plan,
401K and insurance coverage) as if Executive was still employed and this
agreement was in full effect.

7. Miscellaneous.

a. Notices. All notices, demands or other communications
given hereunder shall be in writing and shall be deemed to have been duly given
only upon hand delivery thereof or upon the first business day after mailing by
United States registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

To Employer: Perfumania, Inc.
11701 N.W. 101 Road
Miami, Florida 33178

To Executive: Ilia Lekach
137 Golden Beach Drive
Golden Beach, FL 33160

or to such other address or such other person as any party shall designate, in
writing, to the other for such purposes and in the manner hereinabove set forth.

2
<PAGE> 3

i. Headings. The article and section headings contained in
this Agreement are inserted for convenience only and shall not affect in any way
the meaning or interpretation of the Agreement.

3
<PAGE> 4

o. Renegotiation. To the extent that Employer will make a
significant acquisition or merger, this Agreement shall be renegotiated at terms
no less favorable than this Agreement.

IN WITNESS WHEREOF, Employer and Executive have executed this Agreement
as of the date first above written.

WITNESSES: EMPLOYER:

PERFUMANIA, INC.

By:

EXECUTIVE:

By:

Ilia Lekach

<PAGE> 1
Exhibit 10.10 (e)

SEPARATION AGREEMENT

THES SEPARATION AGREEMENT ("Agreement"), executed this 1st day of
December 1998, but effective for all purposes as of 12:00 a.m. on October 29,
1998 ("Effective Date"), by and between RON A. FRIEDMAN ("Employee") and
PERFUMANIA, INC., a Florida corporation, its subsidiaries and affiliates
(Perfumania, Inc. and its subsidiaries and affiliates are hereinafter
collectively referred to as "Employer"), with the joinder and consent of SUSAN
RUDD FRIEDMAN ("SRF").

WITNESSETH

WHEREAS, Employee was employed by Employer (and/or its predecessor)
from June 1991 through and including October 28, 1998 ("Employee's
Employment");

WHEREAS, Employee's relationship with Employer is being severed as of
the Effective Date;

WHEREAS, Employee is hereby tendering his resignation as a member of
the Board of Directors of Employer, effective 11:59 p.m. on October 28, 1998;
and

WHEREAS, Employer and Employee wish to resolve all outstanding and
other matters relating to or in any manner connected with Employee's
Employment;

NOW, THEREFORE, in consideration of the mutual promises contained
herein and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:

(a) The above recitals are true and correct and are incorporated
herein by this reference.

(b) Employee hereby releases Employer and Employer's predecessors,
shareholders, officers, directors, agents and/or employees, from any charge of
discrimination and all claims or causes of action including, but not limited
to, any claim or cause of action arising out of, under, or relating to
Employee's Employment, the severance of his employment relationship, the Civil
Rights Act of 1871 (42 U.S.C. Sec. 1981), the Labor Management Relations Act
of 1947, the Equal Pay Act of 1963, Title VII of the Civil Rights Act of 1964,
the Occupational Safety and Health Act of 1970, the Rehabilitation Act of 1973,
the Health Maintenance Organization Act of 1973, the Employee Retirement Income
Security Act of 1974, the Immigration Reform and Control Act of 1986, the
Americans with Disabilities Act of 1990, the Civil Rights Act of 1991, the
Family and Medical Leave Act of 1993, Executive Order 11141, Executive Order
11246, Executive Order 11375, Chapter 760 of the Florida Statutes, the Florida
Civil Rights Act of 1992, Chapter 11A of the Dade County Code and/or any other
state, federal or local law.

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<PAGE> 2

(d) In consideration of the matters contained herein, Employer shall
compensate Employee as follows (the "Settlement Package"):

1 Employer shall pay to Employee the sum of Eight Hundred
Twenty-Six Thousand Two Hundred Thirty-Two ($826,232.00),
corresponding to Employee's current salary and benefits for
approximately three (3) years (the "Guaranteed Income"), which
Guaranteed Income is immediately earned and due, however, as an
accommodation to Employer, Employee shall, subject to the terms
of this Agreement, permit Employer to pay the Guaranteed Income
to Employee in accordance with the following installment
schedule:
<TABLE>
<CAPTION>

Pay Date Amount Pay Date Amount Pay Date Amount
-------- ------ -------- ------ -------- ------
<S> <C> <C> <C> <C> <C>
12/09/98 11,068 01/05/00 11,248 01/03/01 11,248
12/23/98 11,068 01/19/00 9,474 01/17/01 9,474
02/02/00 9,474 01/31/01 9,474
01/06/99 85,068 02/16/00 9,474 02/14/01 9,474
01/20/99 11,842 03/01/00 9,474 02/28/01 9,474
02/03/99 10,068 03/15/00 9,474 03/14/01 9,474
02/17/99 10,068 03/29/00 9,474 03/28/01 9,474
03/03/99 10,068 04/12/00 9,474 04/11/01 9,474
03/17/99 10,068 04/26/00 9,474 04/25/01 9,474
03/31/99 10,068 05/10/00 9,474 05/09/01 9.474
04/14/99 10,068 05/24/00 9,474 05/23/01 9,474
04/28/99 10,068 06/07/00 9,474 06/06/01 9,474
05/12/99 10,068 06/21/00 9,474 06/20/01 9,474
05/26/99 10,068 07/05/00 9,474 07/03/01 9,474
06/09/99 10,068 07/19/00 9,474 07/18/01 9,474
06/23/99 10,068 08/02/00 9,474 08/01/01 9,474
07/07/99 10,068 08/16/00 9,474 08/15/01 9,474
07/21/99 10,068 08/30/00 9,474 08/29/01 9,474
08/04/99 10,068 09/13/00 9,474 09/12/01 9,474
08/18/99 10,068 09/27/00 9,474 09/26/01 9,474
09/01/99 10,068 10/11/00 9,474 10/10/01 9,474
09/15/99 10,068 10/25/00 9,474 10/24/01 9,474
09/29/99 10,068 11/08/00 9,474 11/07/01 9,474
10/13/99 10,068 11/22/00 9,474 11/21/01 9,474
10/27/99 10,068 12/06/00 9,474
11/10/99 9,474 12/20/00 9,474
11/24/99 9,474
12/08/99 9,474
12/22/99 9,474

</TABLE>

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<PAGE> 3

In the event Employer fails to timely pay any of the installments
of the Guaranteed Income on the respective dates set forth in the
above schedule, such installment sum(s) then payable shall bear
interest at the highest nonusurious rate permitted by Florida law
from the date due and payable through and including the date
Employee receives such sum(s) in full. Any past due installment
of Guaranteed Income (together with any interest due thereon, if
any) may, at the sole option of Employee, be offset by any
account(s) payable from Employee to Employer in connection with
Employee's purchaser(s) of "Inventory" (as hereinafter defined)
as set forth in SUBPARAGRAPH (E) below.

Within one hundred five (105) days following the expiration of
each of the foregoing calendar years (i.e., calendar years 1999,
2000 and 2001), Employee shall provide Employer with copies of
Employee's Federal and State income tax statements/returns for
the then completed calendar year, together with payment (the
"Overage Payment") of that amount by which Employee's taxable
earned income including, without limitation, income, salaries and
wages derived from whatever source (but specifically excluding
any and all dividend income, interest income, income from the
exercise of stock options [warrants or similar instruments],
portfolio income or other income or gains [of all character and
nature] from investments) and "Net Operating Income" (as
hereinafter defined) derived from "Employee's Business
Activities" (as hereinafter defined) for the then completed
calendar year exceeds the sum of Two Hundred Sixty Thousand Four
Hundred Sixty-Six Dollars ($260,466.00); provided that the
Overage Payment shall be capped at Two Hundred Sixty Thousand
Four Hundred Sixty-Six Dollars ($260,466.00) per calendar year
for each of said calendar years 1999, 2000 and 2001.
Notwithstanding the above, ordinary income from the exercise of
stock options (other than those of Employer) shall be deemed to
be wages but only to the extent that such income exceeds Five
Hundred Thousand Dollars ($500,000) and Employee's employment
with new employer terminated during the year of recognizing the
income from the stock options for tax purposes. "Employee's
Business Activities" shall be defined as any and all business
activities or ventures owned, operated or controlled, directly or
indirectly, either individually or as a partner or stockholder or
otherwise, by Employee, his spouse, lineal descendants or
beneficiaries under his Last Will and Testament or trusts for
his benefit or any of the foregoing. "Net Operating Income" shall
be defined as Employee's share of all revenues derived from
Employee's Business Activities, less and excepting therefrom (i)
all related costs and expenses (no matter how same may be
characterized for tax and/or generally accepted accounting
principles ["GAAP"] accounting purposes, i.e. capitalized or
expensed, in whole or in part) pertaining to the generation of
said revenues, including debt service and priority returns on
capital investments, if any, (ii) all costs and expenses for
health, medical and dental care insurance coverage for Employee
and his dependents, a life insurance policy which will provide a
death benefit in the amount of Two Million Fifty Thousand and
No/100 Dollars ($2,050,000.00), which shall contain a cost of
living adjustment endorsement and a long term disability
insurance policy which shall provide the highest rate of
compensation/benefits then available, a ninety (90)-day waiting
period and benefits payable to the age of seventy-five

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<PAGE> 4

(75), automobile payments (lease or own), insurance, fuel,
maintenance, cellular and mobile telephones, repairs and upkeep
therefore, (iii) allocable depreciation and amortization
(calculated in accordance with GAAP); provided that any
disbursements made by Employee in connection with Employee's
Business Activities other than those pertaining to capital assets
shall be characterized as operating costs even though they may be
required to be capitalized for tax or GAAP accounting purposes,
and (iv) the Employee's share of federal self employment taxes.

2 Employer has granted Employee stock options to purchase four
hundred twenty-nine thousand (429,000) shares of Perfumania, Inc.
common stock ("Options") currently trading on the NASDAQ bulletin
board under the symbol "PRFM". Effective October 29, 1998 and
based on the closing Market Price of Perfumania, Inc. Common
Stock as of October 29, 1998, Employer shall convert all of said
options into shares of Perfumania, Inc. Common Stock at a
conversion price for each share equal to zero dollars ($0.00).
Further, Employer shall cause the original stock certificates
contemplated by the immediately preceding sentence to be
delivered to Employee as soon as reasonably practicable.

3 In the event Employee owns and operates a business similar to, or
in competition with, the business of Employer's retail division
(i.e., retail sale of fragrances, cosmetics and bath and body
products) within three (3) years from the date hereof ("Competing
Business"), Employer shall sell to Employee, (i) inventory
reasonably required to initially open and properly stock such
products for said Competing Business ("Initial Inventory") at
Employer's cost (based upon the method utilized by Employer to
determine cost as of the Effective Date) plus fifteen percent
(15%), and (ii) inventory reasonably required to re-stock said
Competing Business after the initial opening ("Re-Stock
Inventory") at Employer's cost (based upon the method utilized by
Employer to determine cost as of the Effective Date) plus twenty
percent (20%) (Initial Inventory and Re-Stock Inventory are
hereinafter collectively referred to as "Inventory"). To the
extent Employer merges or combines with Parlux Fragrances, Inc.
("Parlux"), costs shall be determined by taking the same
percentage off retail that Employer currently pays Parlux and
adding thereto either fifteen percent (15%) or twenty percent
(20%), whichever is applicable. Employee shall have one hundred
eighty (180) days within which to pay any invoices from Employer
in connection with Initial Inventory and ninety (90) days within
which to pay any invoices from Employer in connection with
Re-Stock Inventory. Any past due invoices in connection with
Employee's purchaser(s) of Inventory shall be offset by any
Guaranteed Income payable to Employee as set forth in SUBPARAGRAPH
(A) above; provided Employer gives written notice to Employee, and
Employee does not satisfy said sums due and owing in connection
with the past due invoice(s) then in question within fifteen (15)
days of the receipt of said notice. In the event Employer shall
offset any such Guaranteed Income, as set forth in the immediately
preceding sentence, Employer shall send written notice to Employee
identifying the application against the then due Guaranteed Income
set forth in SUBPARAGRAPH (A) above. Employee shall resell all
Inventory purchased by Employee only in Employee's Competing
Business, and Employee shall absolutely not wholesale any
Inventory. Notwithstanding the foregoing, Employee shall be
entitled to Wholesale any goods obtained from any source other
than from Employer. Employee shall have no return privileges on
any Inventory, except for Inventory received by Employee in
damaged condition.

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<PAGE> 5
Notwithstanding anything contained herein to the contrary, (i)
Employee shall be under no obligation to purchase any Inventory,
(ii) Employer shall only be obligated to sell Inventory to
Employee subject to availability and/or to the extent available
after Employer has, in its sole and absolute discretion,
completely fulfilled the good faith inventory stocking
requirements of its retail division, (iii) Employee shall not
have the right to purchase any Inventory which is subject to
resale restrictions or other restrictive agreements, whether oral
or written, between Employer and the manufacturers or
distributors of said Inventory, and (iv) Employer shall be under
no obligation to sell any Inventory to Employee beyond that date
which is three (3) years from the date of this Agreement.

4 Employer shall provide Employee with a list(s) of Employer's
suppliers, vendors, and lessors pertaining to Employer's retail
business through and including January 1, 1999. Employee
acknowledges that said list(s) is highly confidential, the
disclosure of which he knows, or should know, will be materially
damaging to Employer's business. As such, Employee agrees that he
shall forever maintain strictly confidential, and shall not
disclose to any person, such list(s), as well as any material
confidential information obtained by Employee during Employee's
Employment with respect to any of the Company's customers,
suppliers, creditors, lenders, investment bankers, financial
information, and methods of marketing, distribution and sales,
the disclosure of which he knows or should know will be
materially damaging to the Company. It is recognized and hereby
acknowledged by Employer and Employee that any breach or
violation by Employee of any or all of the covenants or
agreements set forth above may cause irreparable harm or damage
to Employer's business, the monetary amount of which may be
virtually impossible to ascertain. As a result, Employee agrees
that Employer shall be entitled to an injunction issued by any
court of competent jurisdiction enjoining and restraining any and
all breaches or violations of such covenants by Employee or his
associates, affiliates, partners, employees, agents or designees,
either directly or indirectly, and that such right to an
injunction shall be cumulative and in addition to whatever other
remedies Employer may possess at law or in equity. Nothing
contained herein shall be construed to prevent Employer from
seeking and recovering from Employee damages sustained by it as a
result of any breach or violation by Employee of any of the
covenants or agreements contained herein.

Employee expressly acknowledges the adequacy of the Settlement Package
as consideration for the matters set forth in this Agreement. The parties
hereto acknowledge that the sums required to be paid to Employee under
SUBPARAGRAPH (A) above shall be paid in gross and reportable by Employer to
Employee on Form 1099, and shall not be subject to withholding taxes.

(e) In consideration of the Settlement Package, except as contemplated
by any of Employee's Business Activities in which the terms and provisions of
PARAGRAPH 4(E) hereof shall be or have been

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<PAGE> 6

applicable, which activities are expressly permitted and shall in no event be a
violation of the terms and provisions of this PARAGRAPH 5 and as otherwise
provided below in this Paragraph, Employee shall not, during the period ending
three (3) years from the Effective Date, (i) participate in the management of,
or act as a consultant for, or an employee of, or directly or indirectly
perform services (as an employee, manager, consultant, independent contractor,
advisor or otherwise) for, any entity that is engaged in any facet of business
that is in competition with, or that has a reasonable possibility of materially
affecting in an adverse manner the sales, profits or financial condition of,
the business currently conducted by Employer (as of the Effective Date) (the
"Conducted Business"), or (ii) sell, transfer or otherwise dispose of any
Competing Business to any entity that is engaged in any facet of business that
is in competition with, or that has a reasonable possibility of materially
affecting in a material and adverse manner the sales, profits or financial
condition of, the Conducted Business. Furthermore, during the period ending two
(2) years from the date hereof, Employee shall not, without Employer's prior
written consent, which consent may be withheld by Employer in its sole and
absolute discretion, (i) solicit or otherwise encourage employees or agents to
commence employment or obtain any interest in any business competitive with the
Conducted Business or with which Employee is involved, unless such employees
have not worked for Employer, or received compensation from Employer for a
period of at least one (1) year, or (ii) solicit any customers of Employer.
Notwithstanding anything contained herein to the contrary, the provisions of
this paragraph shall not apply in the event of a change of majority ownership
or control of Employer or in the event Employer's retail division is sold or
spun off to an entity not controlled by the Falic or Lekach families.

Notwithstanding anything contained herein to the contrary, Employee
shall have the right to pursue and effectuate any transaction(s) for the
benefit of Employee's Business Activities utilizing the offering of securities
(including debt and/or equity instruments), regardless of the legal and
accounting structure of said transaction(s), provided after the consummation of
such transaction, Employee remains in the surviving enterprise (including
parent, sister or affiliate thereof) as management or as a controlling party.

(f) The parties agree that this Agreement does not constitute an
admission of any violation by Employer of the laws identified in PARAGRAPH 2
above. This Agreement is offered in settlement of any and all claims involving
Employer and Employee.

(g) Employer and Employee agree to keep the terms of this Agreement
strictly confidential and not to disclose the same to third parties, except
that:

1 Employer and/or Employee may disclose the same as necessary to
secure professional, legal, accounting, tax or other financial
advice or as otherwise required by law or mandated by a court
having competent jurisdiction;

2 Employer may disclose the same as necessary to arrange for
execution of this Agreement and delivery of the Settlement
Package hereunder; and

3 Employer may disclose the same as necessary to prevent
prosecution of an action in contravention hereof

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<PAGE> 7

4 Employee may disclose the same as necessary to secure financing
in connection with Employee's Business Activities or other
investment opportunities.

(h) (a) employer covenants and agrees that: (a) if any of the sums of
money herein referred to are not promptly and fully paid to employee when due
and payable; or (b) if any of the stipulations, agreements, conditions or
covenants contained in this Agreement (other than as provided in Paragraph 8
[a]) are not duly performed, complied with and abided by within ten (10) days
after written notice from Employee to Employer that such performance was due;
and/or (c) if a receiver be appointed for the Employer or for any part of the
assets of the Employer; or (d) in the event any representation made herein be
materially untrue; or (e) upon any order or decree of a court of competent
jurisdiction appointing a receiver, liquidator or trustee of the Employer or of
any of the Employer's properties and the failure to discharge and vacate such
order or decree within thirty (30) days thereof; or (f) upon any order or
decree of any court adjudicating the Employer bankrupt or insolvent or
sequestering any of the Employer's property and the failure to discharge and
vacate such order or decree within thirty (30) days thereof; or (g) upon the
filing by the Employer of a petition in bankruptcy under the provisions of any
bankruptcy law, or any insolvency acts; or (h) the acquiescence in or consent
by the Employer to the filing of any bankruptcy petition against it under any
such law; or (i) the admission in writing by the Employer of its inability to
pay its debts generally as they become due; or (j) if a petition in bankruptcy
is filed against the Employer and such proceeding or petition is not dismissed
within thirty (30) days; or (k) if the Employer has filed a petition or answer
seeking reorganization or arrangement under the bankruptcy laws or any other
applicable law or statute of the United States or any state thereof, then, upon
the happening of any one or more of the aforementioned events, the same shall
be considered a default ("Default") of this Agreement. Upon such Default, the
then aggregate sum(s) of Guaranteed Income fully earned but then remaining
unpaid, with interest accrued on such sums at the highest nonusurious rate
permitted by applicable law (from the dates such sums were due through and
including the date of repayment in full), shall become due and payable
forthwith or thereafter, at the option of the Employee, as fully and completely
as if all the said sums of money were originally stipulated to be paid on such
day, anything in this Agreement to the contrary notwithstanding; and thereupon
or thereafter, at the option of the Employee, without notice or demand, suit at
law or in equity may be prosecuted as if all monies secured hereby had matured
prior to its institution. Further, in the event of a Default, Employer shall be
liable to Employee for all attorneys' fees, paralegals' fees and court costs
through all trial, appellate and administrative levels incurred by Employee,
whether or not litigation results. In that regard, in the event of a Default,
in addition to any and all remedies available at law and/or in equity, Employee
shall have no further obligation to deliver to Employer any Overage Payment,
the term and provisions of PARAGRAPH 5 hereof shall be void, AB INITIO, and at
Employee's option, Employee shall be entitled to pursue any dispute in a court
of competent jurisdiction or elect to utilize binding arbitration as
contemplated by PARAGRAPH 12 hereof.

(b) Employee covenants and agrees that: (a) if any of the sums of
money with regard to Inventory purchased are not timely paid in accordance with
the custom established between the parties, and Employee is not disputing such
sums claimed to be due and owing to Employer; or (b) if a receiver be appointed
for the Employee or for any part of the assets of the Employee; or (c) in the
event any representation made herein be materially untrue; or (d) upon any
order or decree of any

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<PAGE> 8

court adjudicating the Employee bankrupt or insolvent or sequestering any of
the Employee's property and the failure to discharge and vacate such order or
decree within thirty (30) days thereof; or (e) the acquiescence in or consent by
the Employee to the filing of any bankruptcy petition against it under any such
law; or (f) the admission in writing by the Employee of its inability to pay
its debts generally as they become due; or (g) if a petition in bankruptcy is
filed against the Employee and such proceeding or petition is not dismissed
within thirty (30) days; or (h) if the Employee has filed a petition or answer
seeking reorganization or arrangement under the bankruptcy laws or any other
applicable law or statute of the United States or any state thereof; then, upon
the happening of any one or more of the aforementioned events, the same shall
be considered a default ("Default") of this Agreement. Upon such Default,
Employer shall have the right to set-off such sums then due against that
portion of the Guaranteed Income then payable and the Employer's obligation to
sell future Inventory to Employee shall terminate.

(i) Employer hereby represents and warrants to Employee that Employer
is a corporation duly organized, validly existing, and in good standing under
the laws of the State of Florida; has the full corporate power and authority to
execute and deliver this Agreement, and to perform its obligations hereunder
(without limiting the generality of the foregoing, the board of directors of
Employer have duly authorized the execution, delivery and performance of this
Agreement by Employer); and this Agreement constitutes the valid and legally
binding obligation of Employer, enforceable in accordance with its terms and
conditions; and the execution and delivery of this Agreement, or the
consummation of the transactions contemplated hereby, will not violate any
applicable law which Employer is subject, violate any provision of the articles
of incorporation or bylaws of Employer.

(j) Employee has carefully read the foregoing Agreement, knows and
understands the contents thereof and its binding legal effect. He signs the
same on his own free will and act, and it is his intention that he be legally
bound hereby.

(k) If any provisions in this Agreement are held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions shall nevertheless continue in full force without being impaired or
invalidated in any way.

(1) In the event of any proceeding arising hereunder, venue shall be
in Dade County, Florida, and Florida law shall apply. Employer and Employee
hereby knowingly, voluntarily and intentionally waive any right to a jury trial
with respect to any claims arising in connection with the employment
relationship and/or this Agreement. In the event of any litigation hereunder,
the prevailing party shall be entitled to court costs and reasonable attorneys'
fees at trial and all appellate levels.

(m) Notwithstanding anything contained herein to the contrary, to the
extent permitted by Florida law, the parties hereto agree to have any and all
disputes arising under this Agreement settled by arbitration by the American
Arbitration Association ("AAA"), or its successor organization, in the City of
Miami, Florida. Within ten (10) days following the occurrence of any such
dispute, each party shall designate one member of the AAA to sit on the
arbitration panel. The two designated arbiters shall have ten (10) days from
the date the last of said two arbiters is selected to either reach a final
settlement of the dispute or to designate a third member of the AAA as a panel
member. If the two

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<PAGE> 9

designated arbiters reach a final settlement of the dispute within said ten
(10) day period, they shall immediately notify the parties in writing of the
terms of the settlement. If the two designated arbiters designate a third panel
member, the three-member panel shall have ten (10) days from the date of the
designation of the third panel member to reach a final settlement of the
dispute. Said panel shall immediately notify the parties in writing of the
terms of the settlement. The settlement reached by arbitration shall be final,
binding and non-appealable. A judgment upon the settlement may be entered in
any court, federal or state, having jurisdiction thereover. The cost of
arbitration and all expenses and costs incurred in connection with enforcement
and/or collection of any remedy shall be borne by the prevailing party.

(n) Employer and Employee agree that this Agreement sets forth all the
promises and agreements between them and supersedes all prior and
contemporaneous agreements, understandings, inducements or conditions,
expressed or implied, oral or written, except as herein contained.

(o) Employee shall have the unconditional right to assign this
Agreement, in whole or in part, to: (i) any partnership, corporation, trust or
other entity which is owned or controlled by Employee or Susan Rudd Friedman or
(ii) any partnership, corporation, trust or other entity in which a
partnership, corporation, trust or other entity which is owned or controlled by
an affiliate of any person or entity set forth in (i) above. In that regard, in
the event the assignment shall relate to the right to collect the Guaranteed
Income, the entity receiving such assignment shall receive the Form 1099
associated with such income received during that calendar year.

(p) In the event of the death of Employee, this Agreement shall
continue and remain in force and effect, however, the Employee's Business
Activities shall, for all purposes hereinafter during the term of this
Agreement, remain fixed as they existed on the date of death of Employee. The
benefits and burdens of this Agreement shall inure to the estate of Employee
and the disposition of this asset shall be made in accordance with applicable
law.

[SIGNATURE PAGE TO FOLLOW]

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<PAGE> 10

IN WITNESS WHEREOF, Employer and Employee have caused this Agreement
to be executed on the date set forth above.

WITNESSES: EMPLOYER:

PERFUMANIA, INC., a Florida
corporation

By: /s/ Simon Falic
- -------------------------------- ----------------------------------
Simon Falic
CFO

By: /s/ Ron A. Friedman
- -------------------------------- ----------------------------------
Ron A. Friedman

- --------------------------------

The undersigned hereby joins in and consents to this Agreement to
acknowledge and agree to be bound by the terms and provisions of PARAGRAPH 5
hereof, and as a third party beneficiary of the benefits contemplated in this
Agreement.

By: /s/ Susan Rudd Friedman
-----------------------------------
Susan Rudd Friedman

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<PAGE> 11

STATE OF FLORIDA )
) SS:
COUNTY OF DADE )

I HEREBY CERTIFY that on this day, before me, an officer duly
authorized in the State aforesaid and in the County aforesaid to take
acknowledgments, the foregoing instrument was acknowledged before me by Simon
Falic, the Chairman and Chief Executive Officer of Perfumania, Inc., freely and
voluntarily under authority duly vested in him by said corporation. He is
personally known to me or he has produced as identification.

WITNESS my hand and official seal in the County and State last
aforesaid this day of , 1998.

----------------------------------------
Notary Public, State of Florida at Large

My Commission Expires:

----------------------------------------
Typed, printed or stamped name of
Notary Public

STATE OF FLORIDA )
) SS:
COUNTY OF DADE )

WITNESS my hand and official seal in the County and State last
aforesaid this day of , 1998.

----------------------------------------
Notary Public, State of Florida at Large

My Commission Expires:

----------------------------------------
Typed, printed or stamped name of
Notary Public

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<PAGE> 12

STATE, OF FLORIDA )
) SS:
COUNTY OF DADE )

WITNESS my hand and official. seal in the County and State last
aforesaid this day of , 1998.

----------------------------------------
Notary Public, State of Florida at Large

My Commission Expires:

----------------------------------------
Typed, printed or stamped name of
Notary Public

<PAGE> 1
Exhibit 10.10(f)
SEPARATION AGREEMENT

THIS SEPARATION AGREEMENT ("Agreement"), executed this 29th day of
January, 1999, by and between SIMON FALIC ("Employee") and PERFUMANIA, INC., a
Florida corporation, its subsidiaries and affiliates (Perfumania, Inc. and its
subsidiaries and affiliates are hereinafter collectively referred to as "the
Company").

WITNESSETH

WHEREAS, Employee was employed by the Company and/or its predecessor
from the inception of the Company through January 29, 1999 ("Employee's
Employment");

WHEREAS, Employee's relationship with the Company as is being severed,
effective January 29, 1999; and

WHEREAS, Employee is hereby tendering his resignation as Chief
Financial Officer, Chief Operating Officer and a member of the Board of
Directors of the Company, effective January 29, 1999; and

WHEREAS, the Company and Employee wish to resolve all outstanding and
other matters relating to or in any manner connected with Employee's Employment.

NOW, THEREFORE, in consideration of the mutual promises contained
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties agree as follows:

1. The above recitals are true and correct and are incorporated herein
by this reference.

2. On the date of this Agreement, Employee shall return to the Company
any and all documents, lists, data, confidential information, trade secrets,
equipment or other property in his possession belonging to the Company or
relating, in any manner, to the Company's relationship with Employee, except for
those required for the Consulting Services (as hereinafter defined).

3. Employee hereby releases the Company and the Company's predecessors,
shareholders, officers, directors, agents and/or employees, from any charge of
discrimination and all claims or causes of action including, but not limited to,
any claim or cause of action arising out of, under, or relating to Employee's
Employment, the severance of his employment relationship, the Civil Rights Act
of 1871 (42 U.S. C. Sec. 1981), the Labor Management Relations Act of 1947, the
Equal Pay Act of 1963, Title VII of the Civil Rights Act of 1964, the
Occupational Safety and Health Act of 1970, the Rehabilitation Act of 1973, the
Health Maintenance Organization Act of 1973, the Employee Retirement Income
Security Act of 1974, the Immigration Reform and Control Act of 1986, the
Americans with Disabilities Act of 1990, the Civil Rights Act of 1991, the
Family and Medical Leave Act of 1993, Executive Order 11141, Executive Order
11246, Executive Order 11375, Chapter 760 of the Florida Statutes, the Florida
Civil Rights Act of 1992, Chapter 11A of the Dade County Code and/or any other
state, federal or local law.

<PAGE> 2

4. Employee acknowledges and represents that he suffered no workplace
injury during the period of his employment.

5. In consideration of the matters contained herein, the Company shall
compensate Employee as follows (the "Settlement Package"):

(a) The Company shall pay to Employee the following sums corresponding
to Employee's salary for a three (3) year period (the "Salary
Payments"):

January 29, 1999 - January 28, 2000: $318,347.00 per annum
January 29, 2000 - January 28, 2001: $334,264.00 per annum
January 29, 2001 - January 28, 2002: $350,977.00 per annum

The foregoing sums shall be paid in equal consecutive biweekly
installments (i.e., every other week in accordance with the
Company's customary payroll practices); provided, however, that
in the event of a change of control of the Company, the Company
shall immediately pay Employee the entire balance of the Salary
Payments then outstanding in one lump sum payment.

(b) In consideration of a one-time fee of Three Hundred Thousand
Dollars ($300,000.00) payable by the Company to Employee
simultaneously with the execution hereof, Employee shall perform
such consulting services on behalf of the Company (the
"Consulting Services") as the Company may from time to time
request over a period of thirty-six (36) months from the date
hereof, provided, however, that (i) in no event shall Employee be
required to devote to such Consulting Services more than ten
percent (10%) of the time that Employee was required to work
while employed by the Company, and (ii) Employee's obligation to
perform such Consulting Services shall immediately end upon a
change of control of the Company.

(c) Employee may continue to participate in any health, disability or
life insurance plan, retirement plan or other employee benefit
plan maintained or implemented by the Company, to the extent
Employee is eligible to participate under the terms or
requirements of such plan.

Employee expressly acknowledges the adequacy of the Settlement Package
as consideration for the matters set forth herein. Wherever applicable, the
Settlement Package will be subject to withholding of taxes; therefore, the net
amounts actually received by Employee may be less than the amounts set forth
above.

6. The Company shall use its best efforts to release Employee from any
liability or contingent liability on any note, loan guaranty or other
obligation made by Employee to or for the benefit of the Company. Upon the
expiration or earlier termination or modification of the outstanding bank loan
from LaSalle National Bank to the Company, Employee shall be released from any
liability or contingent liability in connection therewith.

<PAGE> 3

7. The parties agree that this Agreement does not constitute an
admission of any violation by the Company of the laws identified in Paragraph 3
above. This Agreement is offered in settlement of any and all claims involving
the Company and Employee and is without prejudice to the Company.

8. The Company and Employee agree to keep the terms of this Agreement
strictly confidential and not to disclose the same to third parties, except
that:

(a) The Company and/or Employee may disclose the same as necessary to
secure legal and tax advice or as otherwise required by law;

(b) The Company may disclose the same as necessary to arrange for
execution of this Agreement and delivery of the Settlement Package
hereunder; and

9. Employee has carefully read the foregoing Agreement, knows and
understands the contents thereof and its binding legal effect. He signs the same
of his own free will and act, and it is his intention that he be legally bound
hereby.

10. If any provisions in this Agreement are held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions shall nevertheless continue in full force without being impaired or
invalidated in any way.

11. In the event of any proceeding arising hereunder, venue shall be in
Dade County, Florida, and Florida law shall apply.

12. The Company and Employee agree that this Agreement sets forth all
the promises and agreements between them and supersedes all prior and
contemporaneous agreements, understandings, inducements or conditions, expressed
or implied, oral or written, except as herein contained.

<PAGE> 4

IN WITNESS WHEREOF, the Company and Employee have caused this Agreement
to be executed on the date set forth above.

WITNESSES:

THE COMPANY:

PERFUMANIA, INC., a Florida
corporation

/s/ Illegible By: /s/ Ilia Lekach
- --------------------------------- -------------------------------
Ilia Lekach
Chairman & CEO

/s/ Illegible
- ---------------------------------

EMPLOYEE:
---------

/s/ Illegible By: /s/ Simon Falic
- --------------------------------- -------------------------------
Simon Falic

/s/ Illegible
- --------------------------------

STATE OF FLORIDA )
) SS:
COUNTY OF DADE )

I HEREBY CERTIFY that on this day, before me, an officer duly
authorized in the State aforesaid and in the County aforesaid to take
acknowledgements, the foregoing instrument was acknowledged before me by Ilia
Lekach, the Chairman and Chief Executive Officer of Perfumania, Inc., freely and
voluntarily under authority duly vested in him by said corporation. He is
personally known to me or he has produced ____________ as identification.

WITNESS my hand and official seal in the County and State last
aforesaid this 29 th day of January, 1999.

/s/ Teresita Bermudez
----------------------------------------
Notary Public, State of Florida at Large

My Commission Expires:

/s/ Teresita Bermudez
----------------------------------------
Typed, printed or stamped name of
Notary Public

ccc: OFFICIAL NOTARY SEAL
TERESITA BERMUDEZ
NOTARY PUBLIC STATE OF FLORIDA
COMMISSION NO. 595222
MY COMMISSION EXP. 0CT. 22, 2000

<PAGE> 5
STATE OF FLORIDA )
) SS:
COUNTY OF DADE )

I HEREBY CERTIFY that on this day, before me, an officer duly
authorized in the State aforesaid and in the County aforesaid to take
acknowledgements, the foregoing instrument was acknowledged before me by Simon
Falic, who is personally known to me or he has produced _______________________
as identification.

WITNESS my hand and official seal in the County and State last
aforesaid this 29th day of January, 1999.

/s/ Teresita Bermudez
----------------------------------------
Notary Public, State of Florida at Large

My Commission Expires: Teresita Bermudez
----------------------------------------
Typed, printed or stamped name of
Notary Public

ccc OFFICIAL NOTARY SEAL
TERESITA BERMUDEZ
NOTARY PUBLIC STATE OF FLORIDA
COMMISSION NO. 595222
MY COMMISSION EXP. 0CT. 22, 2000