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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0000930413-01-500101.txt : 20010402
<SEC-HEADER>0000930413-01-500101.hdr.sgml : 20010402
ACCESSION NUMBER: 0000930413-01-500101
CONFORMED SUBMISSION TYPE: 10-K
PUBLIC DOCUMENT COUNT: 21
CONFORMED PERIOD OF REPORT: 20001231
FILED AS OF DATE: 20010330
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: INTER PARFUMS INC
CENTRAL INDEX KEY: 0000822663
STANDARD INDUSTRIAL CLASSIFICATION: PERFUMES, COSMETICS & OTHER TOILET PREPARATIONS [2844]
IRS NUMBER: 133275609
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 10-K
SEC ACT:
SEC FILE NUMBER: 000-16469
FILM NUMBER: 1586638
BUSINESS ADDRESS:
STREET 1: 551 FIFTH AVE
STREET 2: STE 1500
CITY: NEW YORK
STATE: NY
ZIP: 10176
BUSINESS PHONE: 2129832640
MAIL ADDRESS:
STREET 1: 551 FIFTH AVENUE
STREET 2: STE 1500
CITY: NEW YORK
STATE: NY
ZIP: 10176
FORMER COMPANY:
FORMER CONFORMED NAME: JEAN PHILIPPE FRAGRANCES INC
DATE OF NAME CHANGE: 19920703
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<FILENAME>c20397_10k.txt
<DESCRIPTION>ANNUAL REPORT
<TEXT>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
REPORT ON FORM 10-K
(Mark one)
/X/ Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the fiscal year ended 31 December 2000 or
/ / Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from __________________ to
_________________.
Commission File No. 0-16469
INTER PARFUMS, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3275609
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
551 Fifth Avenue, New York, New York 10176
- ------------------------------------ -----
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 212.983.2640.
------------
Securities registered pursuant to Section 12(b) of the Act: None.
----
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.001 par value per share.
---------------------------------------
Indicate by checkmark 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 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 checkmark if disclosure of delinquent filers pursuant to Item
405 of Regulation SK is not contained herein and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10K or any other
amendment to this Form 10K. / /
State the aggregate market value of the voting stock held by nonaffiliates
of the registrant (based on the closing price of $10.75 on 26 March 2001:
$24,013,393.
Indicate the number of shares outstanding of the registrant's $.001 par
value common stock as of the close of business on the latest practicable date
(26 March 2001): 11,630,777
Documents Incorporated By Reference: None.
<PAGE>
PART I
ITEM 1. BUSINESS
INTRODUCTION
We are Inter Parfums, Inc., a world-wide provider of prestige perfumes and
mass market perfumes and cosmetics. Organized under the laws of the State of
Delaware in May 1985 as Jean Philippe Fragrances, Inc., we changed our name to
Inter Parfums, Inc. on July 14, 1999, to better reflect our image as a provider
of prestige perfumes. We have also retained the brand name, Jean Philippe
Fragrances, for our mass market products.
Our worldwide headquarters and the office of our wholly-owned New York
limited liability company, Jean Philippe Fragrances, LLC, are located at 551
Fifth Avenue, New York, New York 10176 and our telephone number is 212.983.2640.
Our consolidated wholly-owned subsidiary, Inter Parfums Holdings, S.A., its
majority-owned subsidiary, Inter Parfums, S.A. and its two wholly-owned
subsidiaries, Inter Parfums Grand Public, S.A., and Inter Parfums Trademark,
S.A. maintain executive offices at 4, Rond Point des Champs Elysees, 75008
Paris, France. Our telephone number in Paris is 331.5377.0000.
Our common stock is listed on The Nasdaq Stock Market (National Market
System) and its trading symbol is "IPAR". The common shares of our subsidiary,
Inter Parfums S.A., are traded on the Paris Stock Exchange.
We operate in the fragrance and cosmetic industry, specializing in prestige
perfumes and mass market perfumes and cosmetics:
o Prestige products - For each prestige brand, owned or licensed by us, we
develop an original concept for the perfume consistent with world market
trends.
o Mass market products - In our United States operations, we design, market
and distribute inexpensive fragrances and personal care products, including
alternative designer fragrances and mass market cosmetics.
PRODUCTION AND SUPPLY
The stages of the development and production process for all fragrances are
as follows:
o Simultaneous briefing with perfume designers and creators (includes
analysis of esthetic and olfactory trends, target clientele and mass market
communication approach);
o Concept choice;
o Production of mock-ups for final acceptance of bottles and packaging;
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o Invitation of bids from component suppliers (glass makers, plastic
processors, printers, etc.) and packaging companies;
o Choice of vendor partners;
o Supply and packaging schedules;
o Issuance of component purchase orders; and
o Packaging and inventory control;
Suppliers/vendor-partners who assist the Company with product development
include:
o Independent perfumery design companies (Federico Restrepo, Fabien Barron,
Aesthete, Ateliers Dinand);
o Perfumers (IFF, Firmenich, Creations Aromatiques, Quest Wessel Fragrances)
which create a fragrance consistent with our expectations and, that of the
fragrance designers and creators;
o Contract manufacturers of components such as glassware (Saint Gobain,
Pochet, Nouvelles Verreries de Momignie), caps (MT Packaging, Codiplas,
Risdon, Newburgh) or boxes (Printor Packaging, Draeger, Dannex
Manufacturing);
o Production specialists who carry out packaging (MF Production, CCI, CEI
Bottling, IKI Manufacturing) or logistics (SAGA for storage, order
preparation and shipment).
For our prestige product lines, 80% of component and production needs are
purchased from approximately 20 suppliers out of a total of over 120 active
suppliers. The suppliers' accounts for our French operations are primarily
settled in French francs and for our United States operations, suppliers'
accounts are primarily settled in U.S. dollars.
MARKETING AND DISTRIBUTION OF PRESTIGE PRODUCTS
For our international distribution, we contract with independent
distribution companies specializing in luxury goods. In each country, we
designate anywhere from one to three distributors with the status of "exclusive
representative" for one or more of our name brands. We also distribute our
prestige products through a variety of duty-free operators, such as airports and
airlines.
In an effort to reduce our exposure to foreign currency exchange
fluctuations, approximately 35% of our prestige fragrance net sales are sold in
US dollars. We engage in a
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program of cautious hedging of foreign currencies to minimize the risk arising
from operations. As a result of our international operations, sales are not
subject to material seasonal fluctuations.
Distribution in France of our prestige products is carried out by a sales
team who oversee some 1,200 points of sale including, retail perfumers (chain
stores) such as
o Sephora
o Marionnaud
o Nocibe
o Galeries Lafayette
or specialized independent points of sale. Approximately 60% of prestige product
sales in France are made to approximately 40 customers out of a total of over
1,200 active accounts.
Our distributors vary in size depending on the number of competing brands
they represent. This extensive and diverse network provides us with a
significant presence in over 100 countries around the world. Approximately 40
customers out of a total of over 250 active accounts represent 80% of prestige
fragrance sales. No one customer represents more than 10% of sales.
FUBU MARKETING AND DISTRIBUTION
We intend to market our FUBU fragrance products to upscale catalog
companies, specialty retail stores, retail stores which sell FUBU apparel and
drug stores which sell comparable fragrance brands. We may use independent
distributors in the United States and abroad to market and sell our FUBU
fragrances.
MARKETING AND DISTRIBUTION OF MASS MARKET PRODUCTS
In the United States, mass merchandisers, drug store chains and supermarket
chains, are the target customers for our mass market products. Our current
customer list includes
o Albertson's
o Family Dollar
o Dollar General
o Dollar Tree Distributors
o Drug Emporium
o Consolidated Stores
o Pathmark
In addition, our mass market products are sold to wholesale
distributors, such as Variety Wholesalers, specialty store chains, and to
multiple locations of accessory, jewelry and clothing outlets, such as Rainbow
Shoppes.
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<PAGE>
These products are sold through a highly efficient and dedicated in-house
sales team and reach approximately 12,000 retail outlets throughout the United
States. Our 140,000 square foot distribution center has provided us with the
opportunity and resources to better meet our customers' delivery requirements.
The entrepreneurial spirit of our management enables us, and challenges us, to
seek out and master new technologies to better serve our customers.
International distribution of our mass market product lines operate through
the use of exclusive and nonexclusive distribution agreements in such major
territories such as
o Brazil
o Mexico
o Argentina
o Chile
o Columbia
o Canada
o Russia
o Eastern Europe
THE MARKET
The perfumery market can be broken down into two types of distribution:
o Selective distribution - perfumeries and specialty sections of department
stores, who sell brand name products with a luxury image and
o Mass distribution - moderately-priced mass market products for a broad
customer base with limited purchasing power.
SELECTIVE DISTRIBUTION
During 2000, the French perfume industry, which accounts for about 30% of
the world market, reported a 7% growth rate with sales of $12 billion, as
compared to a 6% growth rate in 1999 and a 5% growth rate in 1998. (Source:
Federation des Industries de la Parfumerie)
The French domestic market for selective distribution had another good year
with sales reaching almost $1.5 billion. The increase however, was 5.4% in 2000,
as compared to 6% in 1999 and 8% in 1998.
During 2000, the French export market, which grew at a 9% rate, was
favorably impacted by the declining value of the Euro, as compared to other
currencies:
o Western Europe has seen its sales stabilize as a result of the size and
maturity of this market.
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<PAGE>
o North America, which represents the second largest market of the perfume
and cosmetic industry, reported a 27% increase.
o Asia increased 26% in 2000, as compared to 15% in 1999.
o Latin America, recovering from its financial crisis, increase 24% in 2000,
as compared to a decrease of 12% in 1999.
o Eastern Europe, also recovering from its fiscal crisis reported a 16%
increase. (Source: Federation des Industries de la Parfumerie)
While our market share is less than 1% in France, in other countries such
as the United States, Italy, Portugal, Saudi Arabia and South Korea, the
Company's market share is reportedly between 1% and 4% of French perfumery
imports (internal source).
MASS MARKET DISTRIBUTION
Our mass market distribution consists of moderately-priced products,
including our alternative designer fragrance lines, for a broad customer base
with limited purchasing power. Our mass market products rely heavily on exports
from the United States. We have now sustained five straight quarters in which we
have been able to capitalize on the economic recoveries of certain Latin
American countries. In addition, sales growth from our wide selection of mass
market fragrances continues to exceed our expectations, as the United States
domestic market is becoming stronger. Our new Aziza line of cosmetics has also
achieved widespread acceptance and reorders with distribution in over 12,000
doors. We expect sales to continue to grow as our high volume, discount store
customers open more stores, and we continue to develop new products for them. We
are presently developing a line of health and beauty aids, including shampoos
and conditioners.
COMPETITION
The market for fragrances and beauty related products is highly competitive
and sensitive to changing mass market preferences and demands. The prestige
fragrance industry is highly concentrated around certain major players with
resources far greater than ours. We compete with an original strategy-- regular
and methodical development of quality fragrances for a growing portfolio of
internationally renowned brand names.
Our closest competitors in the prestige market typically do not have mass
market products departments. However, they may develop, market and sell prestige
cosmetics. We do not presently sell prestige cosmetics.
At the present time, we are aware of approximately five established
companies which market similar alternative designer fragrances. This market is
characterized by competition
5
<PAGE>
primarily based upon price. We feel the quality of our fragrance products,
competitive pricing, and our ability to quickly and efficiently develop and
distribute new products, will enable us to continue to effectively compete with
these companies.
The market for name brand and mass market color cosmetics is highly
competitive, with several major cosmetic companies marketing similar products.
Many of these companies have substantial financial resources and national
marketing campaigns. However, we believe that brand recognition of the Aziza
name, together with the quality and competitive pricing of our products, enables
us to compete with these companies in the mass market.
FRAGRANCE AND COSMETIC PRODUCTS
PRESTIGE PERFUMES
Since 1988 we have sought to build a portfolio of luxury brand names
through licensing agreements or through direct acquisition of existing brand
names. Under license agreements we obtain the right to use the brand name,
create new fragrances and packaging, determine positioning and distribution, and
market and sell the licensed products, in exchange for the payment of royalties.
Our rights under license agreements are also generally subject to certain
minimum sales requirements and advertising expenditures.
The creation and marketing of each product line are intimately linked with
the brand's name, its past and present positioning, customer base and, more
generally, the prevailing market atmosphere. Accordingly, we generally conduct a
market study for each proposed product line for almost a full year before we
introduce any new product into the market.
This market study is intended to define the general position of the line
and more particularly its fragrance, bottle, packaging and appeal to the buyer.
In our opinion, the unity of these four elements of the marketing mix makes for
a successful product.
Overall spending on marketing and point of sale support aggregated
approximately $14.4 million in 2000 with approximately $4.2 million in point of
sale support, which is included in cost of sales and $10.2 million in other
marketing costs, included in selling expenses. Distributors of our product lines
contribute a similar amount for additional marketing support. The cost of
launching a new product (molds and tools, start-up costs and communication
costs, media, etc.) generally varies from $0.2 million to $2.0 million.
The smooth and consistent operation of our prestige perfume operations
requires a thorough knowledge of the market, detailed analysis of the image and
potential of each brand name, a "good dose" of creativity, as well as a highly
professional approach to international distribution channels. Our prestige
fragrances have an average life expectancy of five to ten years, and retail at
prices of $30 to $50.
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<PAGE>
Our brand name portfolio, which has been steadily increasing since 1988, is
now made up essentially of six brand names, each of which has a variety of
product lines. In addition, we have planned several new product launches for
2001.
BURBERRY
(BURBERRY OF LONDON, WEEK END, BURBERRY TOUCH)
Burberry is our leading selective brand name and we are operating under the
terms of an exclusive worldwide license agreement entered into in 1993. In
February 2000, we extended the license agreement until December 31, 2006.
Burberry enjoys a very distinctive, upscale-market and classic image, with an
undeniable international cachet.
In August 2000, we launched two new Burberry perfume lines, Burberry Touch,
for men and Burberry Touch for women. These lines are designed with a style
intended to be consistent with the new, more modern and trend-setting Burberry
brand image. In the second quarter of 2001, we intend to bring a new Burberry
Touch bath line to the market.
S.T. DUPONT
(S.T. DUPONT PARIS, SIGNATURE)
In June 1997 we signed an 11-year exclusive license agreement with S.T.
Dupont for the creation, manufacture and worldwide distribution of S.T. Dupont
perfumes. Based on a strong international luxury image, the two lines launched
in September 1998 made a promising start with a strong sell through. A line of
bath products introduced during the first half of 1999 further enhanced the
image of the brand.
In March 2000 we launched a new S.T. Dupont Signature line of two new
highly selective perfumes, designed around the theme of writing for which S.T.
Dupont is famous.
PAUL SMITH
We signed a 12-year exclusive license agreement with Paul Smith in December
1998 for the creation, manufacture and worldwide distribution of Paul Smith
perfumes and cosmetics. This license represents a new avenue for growth, as it
provides us with a unique opportunity in designer perfumes, a sector from which
we have been absent until now.
Paul Smith is an internationally renowned British designer who creates
fashion with a clear identity. Paul Smith has a modern style which combines
elegance, inventiveness and a sense of humor. These images, in conjunction with
a growing audience, provide the justification for the creation of a perfume and
cosmetics line. We launched our first line of Paul Smith perfumes
internationally starting in July 2000.
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CHRISTIAN LACROIX
In March 1999, we entered into an exclusive license agreement with the
Christian Lacroix Company, a division of LVMH Moet Hennessy Louis Vuitton S.A.
("LVMH"), for the worldwide development, manufacture and distribution of
perfumes. For us, this association with a prestigious fashion label is another
key area for growth which we expect will further strengthen our position in the
prestige fragrance market. Our first Christian Lacroix line was launched in
Europe during 1999. During 2000, we launched the line in the United States, with
an exclusive distribution arrangement with Saks Fifth Avenue, and in South
America. In the first quarter of 2001, we plan to launch a lighter eau de
toilette fragrance. We also plan to develop a new line for Christian Lacroix
fragrances for 2002.
CELINE
In May 2000 we entered into an exclusive worldwide license agreement for
the development, manufacturing and distribution of fragrance lines under the
Celine brand name with Celine, a division of LVMH Moet Hennessy Louis Vuitton
S.A. We expect to launch two new fragrance lines by the third quarter of 2001.
Celine, a French luxury fashion and accessory company, and part of LVMH, is
known throughout the world for its luxury and quality products, as well as the
unique designs of Michael Kors. This agreement is an important part of Celine's
strategy to develop dynamic brand recognition and to offer a varied range of
luxury items to an international clientele. Association with this prestigious
fashion label is an important step in the development and expansion of our
prestige business. This relationship is expected to add strength to all of our
prestige brands and contribute to our continued growth.
FUBU
In June 2000 we signed an exclusive worldwide agreement with FUBU The
Collection to produce and sell men's and women's fragrances. Our agreement with
FUBU will allow us to offer a new, contemporary fragrance to consumers.
Everything about the FUBU fragrance lines we are developing, from scent to
packaging, advertising and marketing, will complement the lifestyle image of the
FUBU collections. We anticipate that the first FUBU fragrance line for men and
women will be launched either in the last quarter of 2001, or in the first
quarter of 2002.
Founded by four young men in 1992, FUBU exploded onto the young men's
fashion scene. Music, movie, television and sport stars have worn the designs
all recognizable by the FUBU logos. Today, FUBU product sales exceed $200
million, and encompass men's sportswear-formalwear, ladies, and children's
apparel, as well as footwear and accessory items. The exposure FUBU has received
has helped to create a loyal brand following from ages 5-55 in both the U.S. and
abroad. Today's FUBU customers are both men and women, living in big cities and
small towns, and encompass many diverse ethnic, racial and cultural backgrounds.
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MOLYNEUX
(QUARTZ, QUARTZ POUR HOMME, MODERN QUARTZ)
The Molyneux brand name, which we purchased in March 1994, was originally
created at the turn of the century by the fashion designer Edouard Molyneux, and
ranks among the institutional brand names of French perfumery. Molyneux enjoys a
very prominent market position in South America, especially through the "Quartz"
line for women, which was launched in 1978. The Molyneux brand provides
synergies with the Burberry brand name among duty-free operators (joint sales
areas, use of the same demonstrators, and enhanced positioning for negotiating
with duty-free operators and other customers). The Molyneux name is also well
established in France and other Western European countries. In January 2000 we
launched a totally new line, called Modern Quartz, by Molyneux, in a modernistic
package.
OTHER SELECTIVE BRAND NAMES
We also create, develop and market the following products:
o Jean Charles Brosseau's Ombre Rose lines, through February 2001, which was
sold predominantly in the United States and Japan.
o Parfums Weil, which includes "Fleur de Weil", "Secret de Venus" and
"Bambou" and which are sold predominantly in France and Europe.
o Regine's, who's "Regine's for men" line is primarily distributed in the
Middle East.
The following is a summary of the prestige brand names owned or licensed by
us:
<TABLE>
<CAPTION>
BRAND NAME LICENSED DATE PURCHASE
OR OWNED ACQUIRED TERM PRICE
(IN MILLIONS)
<S> <C> <C> <C> <C>
Burberry Licensed July 93 13 years $0.0
S.T. Dupont Licensed July 97 11 years 1.0
Paul Smith Licensed Dec. 98 12 years 0.0
Celine Licensed May 00 11 years from January 2001, with an 0.0
additional 5-year option term
Molyneux Owned Mar. 94 N/A 4.2
Weil Owned Mar. 94 N/A 1.8
Jean Charles Brosseau Licensed July 93 Through February 2001 1.7
Regines Licensed June 88 Year to year 0.0
Christian Lacroix Licensed Mar. 99 11 years 0.0
FUBU Licensed June 00 6 1/2 years with three additional
2-year option terms.
</TABLE>
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MASS MARKET PRODUCTS
MASS MARKET FRAGRANCES
We produce and market a complete line of alternative designer
fragrances and personal care products which sell at a substantial discount from
their high profile, high retail cost, brand name counterparts. Our alternative
designer fragrances, which are produced in the United States, are similar in
scent to highly advertised designer fragrances that are marketed at a high
retail price. These products are intended to have an upscale image without a
high retail price, and typically sell at a price below $5.00 at the mass market
retail level, substantially discounted from the high cost of designer fragrances
which typically range from $30.00 to $200.00 at prestige retail locations.
Our alternative designer fragrances encompass a complete and increasing
array of fragrances, body sprays, deodorants and perfumed creams. Product line
extensions into additional personal care products is ongoing and development of
new and innovative product lines is a continuous process.
New designer fragrances are constantly being launched in the
marketplace. Substantial expenditure of advertising dollars, selective
distribution and a high retail price create a perfect candidate for an
alternative designer fragrance. We react to demand by creating a similar scent
which, when combined with an innovative packaging design, is ready for sale to
mass market merchandisers, chain drug stores, wholesalers and international
trading companies. To this end, our strategy is to be among the first to release
these new introductions into the market.
Under the terms of a license agreement signed in 1990 with Jordache
Enterprises, we have capitalized on the strength and awareness of the Jordache
trademark. Our rights under this license agreement, which terminate on 30 June
2005, are subject to certain minimum sales requirements and the payment of
royalties. Recent new introductions in the fragrance category are directed at
and focused on the younger, trendy mass market consumer who is the core of the
Jordache franchise. New packaging, which utilizes the latest in graphic
technology, is both innovative and attractive. We expect to continue this trend
with additional line extensions under the Jordache brand name.
MASS MARKET COSMETICS
We purchased the trademark for our Aziza hypo allergenic eye cosmetics
from Unilever N.V. in 1995. After extensive market research and product
development, we launched an Aziza product line in February 1996. Aziza was the
first mass market cosmetic brand to focus solely on the eyes. The recognition of
the Aziza trade name provided us with the opportunity to introduce a new
cosmetic line with an existing loyal customer base.
During August 1999 we introduced our new Aziza II line of low priced
eyeshadow kits, mascara, colorful lip gloss and pencils, which is geared towards
the young teen market. This product line, with its low suggested retail prices,
is being distributed to mass market retailers and discount chains, including the
99 Cent and Dollar Store markets.
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Our Aziza cosmetic line is presently distributed in approximately
12,000 mass market outlets in the United States.
MASS MARKET TOILETRIES
We are developing a line of mass market toiletries consisting of
shampoo, conditioner, hand lotion and baby oil, for distribution in mass market
retailers and deep discount chains, including the 99 Cent and Dollar Store
markets. We anticipate that this line will be available for distribution in the
second quarter of 2001.
INVENTORY
We purchase raw materials and component parts from suppliers based on
internal estimates of anticipated need for finished goods, which enables us to
meet production requirements for finished goods. We generally deliver product to
customers within 72 hours of the receipt of their orders.
PRODUCT LIABILITY
We maintain product liability coverage in an amount of $3,000,000.
Based upon our experience, we believe this coverage is adequate and covers
substantially all of the exposure we may have with respect to our products. We
have never been the subject of any material product liability claims.
GOVERNMENT REGULATION
A fragrance is defined as a "cosmetic" under the Federal Food, Drug and
Cosmetics Act. A fragrance must comply with the labeling requirements of this
FDC Act as well as the Fair Packaging and Labeling Act and its regulations. Some
of our color cosmetic products may contain menthol and are also classified as a
"drug". Under U.S. law, a product may be classified as both a cosmetic and a
drug. Additional regulatory requirements for products which are "drugs" include
additional labeling requirements, registration of the manufacturer and the
semi-annual update of a drug list.
Our fragrances are subject to the approval of the Bureau of Alcohol,
Tobacco and Firearms as a result of the use of specially denatured alcohol. So
far we have not experienced any difficulties in obtaining the required
approvals.
TRADEMARKS
Under various license agreements we have the right to use certain
registered trademarks throughout the world. These registered trademarks include:
o Burberry
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o S.T. Dupont
o Paul Smith
o Christian Lacroix
o Celine
o Regine's
o Jordache
o FUBU
In addition, we are the registered trademark owner of:
o Intimate
o Aziza
o Parfums Molyneux, Captain, Quartz and Lord
o Parfums Weil, Bambou, Antilope and Kipling
o Beverly
o Fire
o Fleur de Paris
EMPLOYEES
As of March 1, 2001 we had 89 full-time employees world-wide. Of these,
36 are engaged in sales activities and 53 in administrative and marketing
activities.
As of March 1, 2001 we had 34 full-time United States employees. Of
these, 9 were engaged in sales activities and 25 in administrative and marketing
activities.
We believe that our relationship with our employees is good.
FORWARD LOOKING INFORMATION AND RISK FACTORS
Statements in this document which are not historical in nature are
forward-looking statements. Forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause the actual results to be
materially different from projected results. Given these risks, uncertainties
and other factors, persons are cautioned not to place undue reliance on the
forward-looking statements.
The following is a discussion of some of the material risk factors
relating to our business:
THE SUCCESS OF OUR PRODUCTS IS DEPENDENT ON PUBLIC TASTE.
Although we believe we have the ability and experience to recognize
valuable fragrances and cosmetic products and gauge trends in the cosmetic and
fragrance market, our revenues are substantially dependent on the success of our
products, which depends upon, among other matters, pronounced and rapidly
changing public tastes, factors which are difficult to predict and over which
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we have little, if any, control. In addition, we have to develop successful
marketing, promotional and sales programs in order to sell our fragrances and
cosmetics. If we are not able to develop successful marketing, promotional and
sales programs, then such failure will have a material adverse effect on our
business, financial condition and operating results.
WE ARE DEPENDENT UPON MESSRS. JEAN MADAR AND PHILIPPE BENACIN, AND THE LOSS OF
THEIR SERVICES COULD HARM OUR BUSINESS.
Jean Madar, our Chief Executive Officer, and Philippe Benacin, our
President, are responsible for day-to-day operations as well as major decisions.
Termination of their relationships with us, whether through death, incapacity or
otherwise, could have a material adverse effect on our operations, and we cannot
assure you that qualified replacements can be found. We maintain key man
insurance on the lives of both Mr. Madar ($1 million) and Mr. Benacin ($2.8
million), however, we cannot assure you that we would be able to retain suitable
replacements for either Mr. Madar or Mr. Benacin.
WE ARE SUBJECT TO EXTREME COMPETITION IN BOTH THE PRESTIGE AND MASS MARKETS.
The market for fragrances and beauty related products is highly
competitive and sensitive to changing market preferences and demands. Many of
these companies have substantial financial resources and national marketing
campaigns.
The prestige fragrance industry is highly concentrated around certain
major players with resources far greater than ours. We compete with an original
strategy-- regular and methodical development of quality fragrances for a
growing portfolio of internationally renowned brand names.
Mass market fragrances are characterized by competition primarily based
upon price. We feel the quality of our fragrance products, competitive pricing,
and our ability to quickly and efficiently develop and distribute new products,
will enable us to continue to effectively compete with these companies.
The market for name brand and mass market color cosmetics is highly
competitive, with several major cosmetic companies marketing similar products.
However, we believe that brand recognition of the Aziza name, together with the
quality and competitive pricing of our products, enables us to compete with
these companies in the mass market.
We cannot assure you that sufficient demand for our existing
fragrances and cosmetics will continue or that we will develop future fragrances
and cosmetic products that will withstand competition.
OUR RELIANCE ON THIRD PARTY MANUFACTURERS COULD HAVE A MATERIAL ADVERSE EFFECT
ON US.
We rely on outside sources to manufacture our fragrances and cosmetics.
Although we enter into agreements with these third party contractors in
anticipation of requirements based
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upon internal estimates, the failure of such third party manufacturers to
deliver either components or finished goods on a timely basis could have a
material adverse effect on or business. Although we believe there are alternate
manufactures available to supply our requirements, we cannot assure you that
current or alternative sources will be able to supply all of our demands on a
timely basis. We do not intend to develop our own manufacturing capacity. As
these are third parties over which we have little or no control, the failure of
such third parties to provide components or finished goods on a timely basis
could have a material adverse effect on our business, financial condition and
operating results.
THE INTERNATIONAL CHARACTER OF OUR BUSINESS RENDERS US SUBJECT TO
FLUCTUATION IN FOREIGN CURRENCY EXCHANGE RATES AND INTERNATIONAL TRADE TARIFFS,
BARRIERS AND OTHER RESTRICTIONS.
In an effort to reduce our exposure to foreign currency exchange
fluctuations, approximately 35% of our prestige fragrance net sales are sold in
US dollars. We engage in a program of cautious hedging of foreign currencies to
minimize the risk arising from operations. Despite such actions, fluctuations in
foreign currency exchange rates for the U.S. dollar, particularly with respect
to the Euro, could have a material adverse effect on our operating results.
Possible import, export, tariff and other trade barriers, which could be imposed
by the United States, France, Canada or other countries might also have a
material adverse effect on our business.
OUR BUSINESS IS SUBJECT TO GOVERNMENTAL REGULATION, WHICH COULD IMPACT OUR
OPERATIONS.
Fragrances and other cosmetics must comply with the labeling
requirements of the Federal Food, Drug and Cosmetics Act as well as the Fair
Packaging and Labeling Act and their regulations. Some of our color cosmetic
products may also be classified as a "drug". Additional regulatory requirements
for products which are "drugs" include additional labeling requirements,
registration of the manufacturer and the semi-annual update of a drug list.
Our fragrances are subject to the approval of the Bureau of Alcohol,
Tobacco and Firearms as a result of the use of specially denatured alcohol. So
far we have not experienced any difficulties in obtaining the required
approvals.
However, we cannot assure you that, should we develop or market
fragrances and cosmetics with different ingredients, or should existing
regulations be revised, we would not in the future experience difficulty in
obtaining such approvals.
WE MAY BE SUBJECT TO POSSIBLE LIABILITY FOR IMPROPER COMPARATIVE ADVERTISING OR
"TRADE DRESS".
Brand name manufacturers and sellers of brand name products may make
claims of improper comparative advertising or trade dress (packaging) with
respect to the likelihood of confusion between some of our mass market
fragrances, cosmetics and toiletries, and those of brand name manufacturers and
sellers. They may seek damages for loss of business or injunctive relief to seek
to have the use of the improper comparative advertising or trade dress halted.
However, we
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believe that our displays and packaging constitute fair competitive advertising
and are not likely to cause confusion between our products and others. Further,
we have not experienced to any material degree, any of such problems to date.
ITEM 2. PROPERTIES
Our corporate headquarters and United States operations are located in
approximately 7,000 square feet of office space at 551 Fifth Avenue, New York,
New York. These premises are leased for a five year term ending October 31,
2002. Our monthly rental is approximately $19,000, which is subject to
escalations.
Our prestige fragrance operations maintain offices located at 4 Rond
Point Des Champs Elysees, Paris, France, in approximately 6,000 square feet of
leased office space pursuant to two leases. The first lease is for approximately
4,000 square feet. The second lease is for approximately 2,000 square feet. Both
of these leases expire in July 2005, unless terminated earlier by either party
on six months written notice at three year specified intervals. The annual
rentals are 833,000 French francs for the first lease and 467,000 French francs
for the second lease. Rent is subject to escalations each July 1.
In addition, we have a lease for approximately 2500 square feet of
additional office space at 18 avenue Franklin Roosevelt, Paris, France, for a
term ending April 2009, at an annual rental of approximately 588,000 French
francs per year, which is subject to escalations. We have the right to terminate
earlier at three year specified intervals.
We believe our office facilities are satisfactory for our present needs
and those for the foreseeable future.
We also occupy a 140,000 square foot distribution center at 60 Stults
Road in Dayton, New Jersey. We are leasing these premises for an eight year term
which expires October 2003 and requires monthly rental payments of approximately
$57,000. We believe that our distribution center is satisfactory for our present
needs and those for the foreseeable future.
ITEM 3. LEGAL PROCEEDINGS
BROSSEAU LAWSUIT
As previously reported, Inter Parfums, S.A., is a party to litigation
with Jean Charles Brosseau, S.A. ("Brosseau"), the licensor of the Ombre Rose
trademark. The licensor has claimed damages of approximately $7.0 million and is
seeking termination of the license agreement.
15
<PAGE>
In October 1999, Inter Parfums, S.A. received notice of a judgment in
favor of Brosseau, which awarded damages of approximately $600,000 and which
directed Inter Parfums, S.A. to turn over its license to Brosseau within six
months.
Inter Parfums, S.A. is appealing the judgment as it vigorously and
categorically denies the claims of Brosseau. The payment of the judgment has
been stayed, and Inter Parfums, S.A. was allowed to continue to operate under
the license agreement during the appeal process.
In June 2000, the president of the Court of Appeal granted a petition
filed by Brosseau regarding ongoing payments for royalties due to Brosseau. In
the same interlocutory judgment, the president of the Court of Appeal rejected
Inter Parfums, S.A.'s request for the appointment of a new judicial expert. Such
request was made to refute the findings of the judicial expert originally
appointed by the Commercial Court, which resulted in the $600,000 judgment
against Inter Parfums, S.A. As a result of these further developments, Inter
Parfums, S.A. and its special litigation counsel then considered it likely that
the judgment would be sustained and therefore, Inter Parfums, S.A. recorded a
charge against earnings in the second quarter of 2000 for $600,000 ($260,000
after taxes and minority interest), the full amount of the judgment.
In February 2001, the Court of Appeal confirmed the Brosseau claim
with respect to turning over the license. In addition, the Court named an expert
to proceed with additional investigations and required Inter Parfums, S.A. to
pay $142,000 as an advance against the damages claimed by Brosseau.
Inter Parfums, S.A. will continue its appeal as it still denies the
claims of Brosseau. We do not believe that such litigation will have any further
material adverse effect on our financial condition or operations. As of December
31, 2000, we have fully reserved the unamortized portion of the license
agreement.
ITEM 4. SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Our company's common stock, $.001 par value per share, is traded on
The Nasdaq Stock Market (National Market System) under the symbol "IPAR". The
following table sets forth in dollars, the range of high and low closing prices
for the past two fiscal years for our common stock, which has been adjusted to
reflect the 3:2 stock split distributed in June 2000.
-------------------- --------------------- ---------------------
Fiscal 2000 High Closing Price Low Closing Price
-------------------- --------------------- ---------------------
Fourth Quarter $ 9.50 $ 7.63
-------------------- --------------------- ---------------------
Third Quarter $ 9.00 $ 6.88
-------------------- --------------------- ---------------------
Second Quarter $ 9.44 $ 7.04
-------------------- --------------------- ---------------------
First Quarter $ 9.00 $ 6.00
-------------------- --------------------- ---------------------
Fiscal 1999 High Closing Price Low Closing Price
-------------------- --------------------- ----------------------
Fourth Quarter $ 7.00 $ 5.92
-------------------- --------------------- ----------------------
Third Quarter $ 7.09 $ 5.00
-------------------- --------------------- ----------------------
Second Quarter $ 5.67 $ 4.00
-------------------- --------------------- ----------------------
First Quarter $ 4.67 $ 3.75
-------------------- --------------------- ----------------------
As of March 1, 2001, the number of record holders, which include
brokers and broker's nominees, etc., of the company's common stock was 77. We
believe there are approximately 500 beneficial owners of the company's common
stock.
DIVIDENDS
We have not paid cash dividends since inception and we do not foresee
paying cash dividends in the foreseeable future as earned surplus is to be
retained for working capital for anticipated growth.
In addition, our Certificate of Incorporation provides for the
requirement of unanimous approval of the members of our board of directors for
the declaration or payment of dividends, if the aggregate amount of dividends to
be paid by us and our subsidiaries in any fiscal year is more than thirty
percent (30%) of our annual net income for the last completed fiscal year, as
indicated by our consolidated financial statements.
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SALES OF UNREGISTERED SECURITIES
The following sets forth certain information as to all equity
securities, other than the grant of options, which we sold during the past year
that were not registered under the Securities Act of 1933, as amended, except as
previously reported. In each of the transactions, we sold common stock to
accredited investors, affiliates and employees, upon the exercise of outstanding
stock options which were exempt from the registration requirements of Section 5
of the Securities Act under Sections 4(2) and 4(6) of the Securities Act. Each
shareholder agreed to purchase his common stock for investment and not for
resale to the public.
From 9 November 2000 through 5 December 2000, three (3) persons,
consisting of two (2) executive officers and directors and one (1) employee
exercised outstanding stock options to purchase an aggregate of 151,125 shares
of Common Stock and we received approximately $867,000 in proceeds as a result
of such exercises.
The following sets forth certain information as to all options granted
to purchase our equity securities during the past year, which were not
registered under the Securities Act, except as previously reported. In each of
the transactions, we granted options to affiliates (executive officers and
directors), employees and two (2) consultants. The transactions were exempt
from the registration requirements of Section 5 of the Securities Act under
Sections 4(2) and 4(6) of the Securities Act. Each option holder agreed that,
if the option is exercised, the option holder would purchase his common stock
for investment and not for resale to the public.
On 3 January 2000, we granted options to purchase an aggregate of
32,775 shares for a five year period at the exercise price of $6.08 per share,
the fair market value at the time of grant, to 30 employees under our 1999 Stock
Option Plan.
On 1 February 2000, we granted options to purchase an aggregate of
10,500 shares for a five year period at the exercise price of $6.792 per share,
the fair market value at the time of grant, to four directors under our 1997
Non-Employee Director Stock Option Plan.
On 27 October 2000, we granted options to purchase an aggregate of
68,600 shares for a five year period at the exercise price of $7.625 per share,
the fair market value at the time of grant, to 35 persons (30 employees, three
executive officers and two consultants) under our 1999 Stock Option Plan.
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ITEM 6. SELECTED FINANCIAL DATA
The following selected financial data have been derived from our
financial statements, and should be read in conjunction with those financial
statements, including the related footnotes.
YEARS ENDED DECEMBER 31
(In Thousands Except Share and Per Share Data)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------
2000 1999 1998 1997 1996
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------
Income Statement Data:
- ------------------------------------------------------------------------------------------------------------
Net Sales $101,582 $87,140 $89,388 $91,462 $93,281
- ------------------------------------------------------------------------------------------------------------
Cost of Sales 51,873 45,325 47,417 49,388 51,355
- ------------------------------------------------------------------------------------------------------------
Selling, General and Administrative 37,509 31,965 32,944 32,334 32,416
- ------------------------------------------------------------------------------------------------------------
Income Before Taxes and Minority Interest 13,539 9,868 9,164 8,172 9,081
- ------------------------------------------------------------------------------------------------------------
Net Income 6,589(2) 4,828 4,613 4,507(1) 5,658
- ------------------------------------------------------------------------------------------------------------
Net Income per Share(3):
Basic $ 0.56 $ 0.43 $ 0.35 $ 0.32(1) $ 0.38
Diluted $ 0.51 $ 0.40 $ 0.35 $ 0.32(1) $ 0.38
- ------------------------------------------------------------------------------------------------------------
Average Common Shares Outstanding(3):
Basic 11,726,737 11,387,885 13,060,935 13,949,102 14,807,547
Diluted 13,000,432 12,155,226 13,348,208 14,095,994 14,976,695
- ------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes a nonrecurring charge, after taxes and minority interest, of
$0.8 million or $0.05 per diluted share, relating to the divestiture of
the Cutex license in 1997.
(2) Includes nonrecurring charges aggregating $0.6 million and a gain of
$0.6 million, all after taxes and minority interest. The charges
represent an accrual for exposure relating to pending litigation of
$0.2 million and a potential tax assessment of $0.4 million. The gain
represents a realized gain on the sale of marketable securities.
(3) Adjusted for 3:2 stock split distributed in June 2000.
AS AT DECEMBER 31
(In Thousands Except Share and Per Share Data)
2000 1999 1998 1997 1996
- --------------------------------------------------------------------------------
Balance Sheet Data:
- --------------------------------------------------------------------------------
Working Capital $57,688 $52,402 $49,599 $44,842 $46,568
- --------------------------------------------------------------------------------
Total Assets 94,571 87,223 87,739 80,282 85,585
- --------------------------------------------------------------------------------
Long-Term Debt 1,417 1,531 200 424 485
- -------------------------------------------------------------------------------
Shareholders' Equity 55,061 52,361 53,680 50,194 53,366
- --------------------------------------------------------------------------------
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ITEM 7 . MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
INTRODUCTION
We are a leading manufacturer and distributor of fragrances, cosmetics
and personal care products. Innovation and creativity are combined to produce
quality products for our customers around the world.
We operate in the fragrance and cosmetic industry, specializing in
prestige perfumes and mass market perfumes and cosmetics:
o Prestige products - for each prestige brand, owned or licensed by us, we
develop an original concept for the perfume consistent with world market
trends.
o Mass market products - in our United States operations, we design, market
and distribute inexpensive fragrances and personal care products, including
alternative designer fragrances and mass market cosmetics.
2000 COMPARED TO 1999
In fiscal year 2000, we set a new sales record. Net sales for the year
ended December 31, 2000 increased 17% to $101.6 million, as compared to $87.1
million in 1999. At comparable foreign currency exchange rates, net sales
actually rose 30% in 2000 as compared to 1999.
Our sales growth is attributable to across-the-board increases in both
our prestige and mass market product lines. However, the precipitous rise of the
US dollar in relation to the French franc has masked our true revenue growth.
Growth in net sales of prestige products, which was up approximately
17% in 2000, was fueled in part by the tremendous success of the recent launches
of our Paul Smith and "Burberry Touch" fragrance lines. Paul Smith premiered in
the United Kingdom in July and is presently being sold in over 450 U.K. doors.
Sales ran well ahead of expectations in the initial phase of the roll out.
"Burberry Touch", our newest Burberry fragrance, was launched worldwide in late
September 2000, and initial consumer reaction has been very favorable.
Additional year 2000 launches included our S.T. Dupont "Signature" line, which
continues to perform strongly in the Far East, and "Modern Quartz" by Molyneux,
which is very successful in France and South America.
In addition to expanding the geographic distribution of products we
launched in 2000, we have a large new product and brand extension pipeline in
the works. We are leveraging the popularity of "Burberry Touch" by bringing to
market a new bath line for men and women, scheduled for introduction later this
year. In March 2001, Paul Smith fragrances will be launched in Japan where this
designer has a large and loyal fashion following and over 200 standing doors. In
February 2001, we unveiled Christian Lacroix "Eau Florale" in the U.S. with
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an exclusive at Saks Fifth Avenue's 63 stores, to be followed by European
distribution later this spring. Development is going well with Celine, our
second LVMH license, and we are on target for the initial launch of two new
Celine fragrances in the fourth quarter of 2001.
Net sales of our mass market products were up 17% for the year ended
December 31, 2000, as compared to 1999. Sales growth from our wide selection of
mass market fragrances continues to exceed our expectations. Our new Aziza line
of cosmetics has also achieved widespread acceptance. We expect sales to
continue to grow as our high volume, discount store customers open more stores,
and we continue to develop new products for them. We are presently developing a
line of health and beauty aids, including shampoos and conditioners.
Growing sales within existing product lines, new product launches and
an active new business development program are how we plan to continue to grow
our business in the year 2001 and beyond. During the year ended December 31,
2000 we signed an exclusive worldwide license agreement with Celine, a division
of LVMH Moet Hennessy Louis Vuitton S.A. Our first line of Celine fragrances is
expected to debut in October 2001. Also during fiscal 2000, we signed an
exclusive worldwide license agreement with FUBU The Collection to produce and
sell men's and women's fragrances. We anticipate that the first FUBU fragrance
line for men and women will be launched either in the last quarter of 2001, or
in the first quarter of 2002. In addition, we are actively pursuing new business
opportunities. However, we cannot assure you that any new license or
acquisitions will be consummated.
Gross profit margins increased to 49% of net sales for the year ended
December 31, 2000, as compared to 48% in 1999. Gross profit margins have
continued to increase over the past four years. Part of this improvement is the
result of the strength of the US dollar in relation to the Euro, as certain
European sales are denominated in US dollars. In addition, our prestige
fragrance lines, which have been growing at a faster rate than our mass market
lines, generate a higher gross profit margin than our mass market product lines.
Selling, general and administrative expenses increased to $37.5 million
for the year ended December 31, 2000, as compared to $32.0 million in 1999 and
represented 37% of sales in both 2000 and 1999.
In the United States, selling, general and administrative expenses
increased to $9.8 million for the year ended December 31, 2000, as compared to
$9.1 million in 1999, but declined to 31% of net sales in 2000, as compared to
34% of net sales in 1999. Our mass market sales do not require extensive
advertising and therefore, more of our selling, general and administrative
expenses are fixed rather than variable. As a result, the increase in sales has
enabled us to spread our fixed costs over a larger net sales base.
Selling, general and administrative expenses incurred by our French
subsidiary, Inter Parfums, S.A., increased to $27.7 million for the year ended
December 31, 2000, as compared to $22.8 million in 1999. As a percentage of
sales, selling, general and administrative expenses represented 39% of sales in
2000, as compared to 38% in 1999. Promotion and advertising are prerequisites
for sales of designer products. We develop a complete marketing and promotional
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<PAGE>
plan to support our growing portfolio of prestige fragrance brands and to build
upon each brand's awareness.
As previously reported, Inter Parfums, S.A., is a party to litigation
with Jean Charles Brosseau, S.A. ("Brosseau"), the licensor of the Ombre Rose
trademark. The licensor has claimed damages of approximately $7.0 million and is
seeking termination of the license agreement.
In October 1999, Inter Parfums, S.A. received notice of a judgment in
favor of Brosseau, which awarded damages of approximately $600,000 and which
directed Inter Parfums, S.A. to turn over its license to Brosseau within six
months.
Inter Parfums, S.A. is appealing the judgment as it vigorously and
categorically denies the claims of Brosseau. The payment of the judgment has
been stayed, and Inter Parfums, S.A. was allowed to continue to operate under
the license agreement during the appeal process.
In June 2000, the president of the Court of Appeal granted a petition
filed by Brosseau regarding ongoing payments for royalties due to Brosseau. In
the same interlocutory judgment, the president of the Court of Appeal rejected
Inter Parfums, S.A.'s request for the appointment of a new judicial expert. Such
request was made to refute the findings of the judicial expert originally
appointed by the Commercial Court, which resulted in the $600,000 judgment
against Inter Parfums, S.A. As a result of these further developments, Inter
Parfums, S.A. and its special litigation counsel then considered it likely that
the judgment would be sustained and therefore, Inter Parfums, S.A. recorded a
charge against earnings in the second quarter of 2000 for $600,000 ($260,000
after taxes and minority interest), the full amount of the judgment.
In February 2001, the Court of Appeal confirmed the Brosseau claim with
respect to turning over the license. In addition, the Court named an expert to
proceed with additional investigations and required Inter Parfums, S.A. to pay
$142,000 as an advance for damages claimed by Brosseau.
Inter Parfums, S.A. will continue its appeal as it still denies the
claims of Brosseau. We do not believe that such litigation will have any further
material adverse effect on our financial condition or operations. As of December
31, 2000, we have fully reserved the unamortized portion of the license
agreement.
During the year ended December 31, 2000 we sold marketable securities
and realized a gain of $1.4 million ($645,000 after taxes and minority
interest). On occasion, we invest excess cash in marketable securities, which
are classified as available-for-sale. These funds are available to support
current operations or to take advantage of other investment opportunities. At
December 31, 2000, we had no remaining marketable security positions.
Interest expense was $0.4 million for the year ended December 31, 2000,
as compared to $0.3 million in 1999. We use the credit lines available to us, as
needed, to finance our working capital needs.
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<PAGE>
We incurred a loss on foreign currency of $0.2 million for both of our
last two fiscal years. Occasionally, we enter into foreign currency forward
exchange contracts to manage exposure related to certain foreign currency
commitments.
Our effective income tax rate was 42% for the year ended December 31,
2000, as compared to 40% in 1999. The effective tax rate for the year ended
December 31, 2000 includes a $480,000 ($370,000 after minority interest) accrual
to cover the potential exposure related to tax audits of Inter Parfums, S.A.
commenced by the French Tax Authorities. If not for these accruals, the
declining tax rates in France would have caused a decline in our overall
effective tax rate.
Net income increased 36% to $6.6 million for the year ended December
31, 2000, as compared to $4.8 million in 1999. Net income for the year ended
December 31, 2000 includes charges of $630,000 and a gain of $645,000, all after
taxes and minority interest. The charges represent an accrual for exposure
relating to the Brosseau litigation of $260,000 and a potential tax assessment
of $370,000. The gain represents a realized gain on sale of marketable
securities.
After giving effect to our 3 for 2 stock split effected in June 2000,
diluted earnings per share increased 27% to $0.51 for the year ended December
31, 2000, as compared to $0.40 in 1999. Weighted average shares outstanding
aggregated 11.7 million for the year ended December 31, 2000, as compared to
11.4 million in 1999. On a diluted basis, average shares outstanding was 13.0
million for the year ended December 31, 2000, as compared to 12.2 million in
1999. Shares repurchased pursuant to our stock repurchase program, offset shares
issued upon exercise of stock options. However, the increase in our stock price
has increased the dilutive effect of outstanding stock options, thereby
increasing diluted shares outstanding.
1999 COMPARED TO 1998
Net sales for the year ended December 31, 1999 were $87.1 million, as
compared to $89.4 million in 1998. At comparable foreign currency exchange
rates, net sales for the year ended December 31, 1999 were virtually unchanged
from that of 1998.
These results were in line with management's expectations as no new
prestige fragrance launches were scheduled for 1999 and we entered the year
during a downward trend in our mass market product lines, which resulted from
the unsteady economic situation in Eastern Europe, Brazil and other Latin
American countries.
In March 1999, we entered into an exclusive license agreement with the
Christian Lacroix Company, a division of LVMH Moet Hennessy Louis Vuitton S.A.
("LVMH") and a new Christian Lacroix product line was launched in October 1999.
In addition, in the latter part of 1999, the downward trend in our mass market
product lines began to reverse. As a result, at comparable foreign currency
exchange rates, net sales increased 17% for the three months ended December 31,
1999, as compared to the corresponding period of the prior year.
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We are also actively pursuing new license agreements to build upon the
strength of our existing portfolio.
Gross profit margins increased to 48% of net sales for the year ended
December 31, 1999, as compared to 47% in 1998. Gross profit margins have
continued to increase over the past three years. Part of the gross profit margin
improvement is the result of the strength of the US dollar relative to the Euro,
as certain European sales are denominated in US dollars. Our prestige fragrance
lines also generate a higher gross profit margin than our mass market product
lines and these gross profit margin benefits have offset the negative affect of
lower margin mass market product sales and closeout sales.
Selling, general and administrative expenses declined to $32.0 million
for the year ended December 31, 1999, as compared to $32.9 million in 1998.
Selling, general and administrative expenses represented 37% of sales in both
1999 and 1998.
In the United States, selling, general and administrative expenses
declined 20% to $9.1 million for the year ended December 31, 1999, as compared
to $11.4 million in 1998, and declined to 34% of net sales in 1999, as compared
to 37% of net sales in 1998. As a result of the weakness in domestic mass market
product sales experienced in early 1999, we instituted extraordinarily tight
controls in an effort to keep spending in line with sales.
Selling, general and administrative expenses incurred by our French
subsidiary, Inter Parfums, S.A., were $22.8 million for the year ended December
31, 1999, as compared to $21.5 million in 1998. Some savings has been achieved
in distribution and freight costs. However, a reasonable level of advertising is
necessary to support our growing portfolio of prestige fragrance brands and to
build upon each brand's awareness.
Interest expense was $0.3 million for the year ended December 31, 1999,
as compared to $0.5 million in 1998. We use the credit lines available to us, as
needed, to finance our working capital needs.
We incurred a loss on foreign currency of $0.2 million for the year
ended December 31, 1999, as compared to $0.1 million in 1998. Occasionally, we
enter into foreign currency forward exchange contracts to manage exposure
related to certain foreign currency commitments.
Our effective income tax rate was 40% for the year ended December 31,
1999, as compared to 39% in 1998. The effective tax rate for 1998 reflects the
positive effects of the tax benefit to be realized upon the closing of our
Brazilian subsidiary.
Net income increased 5% to $4.8 million for the year ended December 31,
1999, as compared to $4.6 million in 1998. Earnings per diluted share increased
to $0.40 for the year ended December 31, 1999, as compared to $0.35 in 1998.
Weighted average shares outstanding aggregated 11.4 million for the
year ended December 31, 1999, as compared to 13.1 million in 1998. On a diluted
basis, average shares
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outstanding was 12.2 million for the year ended December 31, 1999, as compared
to 13.3 million in 1998. The declines are the result of our common stock
repurchase program.
LIQUIDITY AND FINANCED RESOURCES
Our financial position remains very strong as a result of continued
profitable operating results. At December 31, 2000, working capital aggregated
$57 million and we had a working capital ratio of almost 3 to 1. Cash and
marketable securities on hand aggregated $28 million and our net book value was
$4.72 per outstanding share as of December 31, 2000. Furthermore, we had only
$1.4 million in long-term debt.
On occasion we use a portion of our cash to make investments in
marketable equity securities classified as available-for-sale. These funds are
available to support current operations or to take advantage of other investment
opportunities. These investments are made to maximize our return on cash. As of
December 31, 2000 we had no marketable security positions.
During the year ended December 31, 2000, we continued our stock
repurchase program by acquiring 343,600 of our common shares at an average cost
of $8.19 per share. We believe that our stock price does not reflect our growth
rate, prospects for future growth, the value of our licenses and our worldwide
distribution network. In addition, the market capitalization of our 78%
ownership interest in Inter Parfums, S.A., our publicly traded Paris subsidiary,
is in excess of $150 million, which is significantly higher than that of the
company as a whole.
Our short-term financing requirements are expected to be met by
available cash at December 31, 2000, cash generated by operations and short-term
credit lines provided by domestic and foreign banks. The principal credit
facilities for 2001 are a $12.0 million unsecured revolving line of credit
provided by a domestic commercial bank and approximately $12.0 million in credit
lines provided by a consortium of international financial institutions.
During the year ended December 31, 2000 we generated $0.2 million in
cash from operating activities, as compared to $12.6 million in 1999. At
December 31, 2000 accounts receivable increased 18%, as compared to December 31,
1999, which is in line with our 17% increase in net sales. In addition,
inventories rose 30% as a result of a planned buildup to support all of the
recent new product launches and to prepare for anticipated revenue growth.
We believe that funds generated from operations, supplemented by our
present cash position and available credit facilities, will provide us with
sufficient resources to meet all present and reasonably foreseeable future
operating needs.
In January 1999, certain member countries of the European Union
established permanent fixed rates between their existing currencies and the
European Union's common currency, the Euro. The transition period for the
introduction of the Euro is scheduled to be completed by January 1, 2002.
However, we do not expect the introduction of the Euro and the phasing out of
other currencies to have a material impact on our consolidated financial
statements.
25
<PAGE>
Inflation rates in the U.S. and foreign countries in which we operate
did not have a significant impact on operating results for the year ended
December 31, 2000.
FORWARD LOOKING STATEMENTS
Statements in this document, which are not historical in nature, are
forward-looking statements. Forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause the actual results to be
materially different from projected results. Given these risks, uncertainties
and other factors, persons are cautioned not to place undue reliance on the
forward-looking statements.
Such factors include effectiveness of sales and marketing efforts and
product acceptance by consumers, dependence upon management, competition,
currency fluctuation and international tariff and trade barriers, governmental
regulation and possible liability for improper comparative advertising or "Trade
Dress".
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
GENERAL
We address certain financial exposures through a controlled program of
risk management that primarily consists of the use of derivative financial
instruments. We primarily enter into foreign currency forward exchange contracts
in order to reduce the effects of fluctuating foreign currency exchange rates.
We have entered into one (1) interest rate swap in an attempt to take advantage
of low variable interest rates as compared to the fixed rate on our long term
debt. We do not engage in the trading of foreign currency forward exchange
contracts or interest rate swaps.
FOREIGN EXCHANGE RISK MANAGEMENT
We enter into forward exchange contracts to hedge receivables
denominated in foreign currencies for periods consistent with our identified
exposures. The purpose of the hedging activities is to minimize the effect of
foreign exchange rate movements on the receivables and cash flows of Inter
Parfums, S.A., our French subsidiary, whose functional currency is French
francs. All foreign currency contracts are denominated in currencies of major
industrial countries and are with large financial institutions, which are rated
as strong investment grade. Gains and losses related to qualifying hedges of
these exposures are deferred and recognized in operating income when the
underlying hedged transaction occurs.
We believe that our risk of loss as the result of nonperformance by any
of such financial institutions is remote and in any event would not be material.
The contracts have varying maturities with none exceeding one year. Costs
associated with entering into such contracts have not been material to our
financial results. At December 31, 2000, we had foreign currency contracts in
the form of forward exchange contracts in the amount of approximately $9
million.
26
<PAGE>
The foreign currencies included in these contracts are principally the U.S.
dollar and the British pound.
INTEREST RATE RISK MANAGEMENT
We mitigate interest rate risk by continually monitoring interest
rates, and then determining whether fixed interest rates should be swapped for
floating rate debt, or if floating rate debt should be swapped for fixed rate
debt. We have entered into one (1) interest rate swap to take advantage of
declining interest rates. At December 31, 2000 we had one (1) interest rate swap
agreement outstanding to convert $1.4 million of principal fixed rate debt with
an interest rate of 4.56% to floating interest rate debt, at the EUIBOR rate,
over the life of our long term debt due in 2005. At December 31, 2000, the
EUIBOR rate was 4.9%. If interest rates were to rise 1% per annum over the
remaining term of the long term debt, then we would incur a loss of $50,000.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The required financial statements commence on page F-1.
SUPPLEMENTARY DATA
QUARTERLY DATA (UNAUDITED)
FOR THE YEAR ENDED 31 DECEMBER 2000
(In Thousands Except Share and Per Share Data)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Full Year
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Sales $22,169 $24,277 $25,940 $29,196 $101,582
- ----------------------------------------------------------------------------------------------------
Cost of Sales 12,245 12,541 13,923 13,164 51,873
- ----------------------------------------------------------------------------------------------------
Net Income 1,422 1,508 1,635 2,024 6,589
- ----------------------------------------------------------------------------------------------------
Net Income per Share(1):
Basic $0.12 $0.13 $0.14 $0.17 $0.56
Diluted $0.11 $0.12 $0.13 $0.16 $0.51
- ----------------------------------------------------------------------------------------------------
Average Common Shares
Outstanding(1): 11,767,250 11,754,490 11,726,616 11,658,756 11,726,737
Basic 12,925,178 13,026,453 13,013,615 13,036,570 13,000,432
Diluted
- ----------------------------------------------------------------------------------------------------
</TABLE>
(1) Adjusted for 3:2 stock split distributed in June 2000.
QUARTERLY DATA (UNAUDITED)
FOR THE YEAR ENDED 31 DECEMBER 1999
(In Thousands Except Share and Per Share Data)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Full Year
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Sales $19,584 $22,192 $21,652 $23,712 $87,140
- ----------------------------------------------------------------------------------------------------
Cost of Sales 10,099 11,741 11,649 11,836 45,325
- ----------------------------------------------------------------------------------------------------
</TABLE>
27
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
Net Income 1,157 1,084 1,204 1,383 4,828
- ----------------------------------------------------------------------------------------------------
Net Income per Share(1):
Basic $0.10 $0.10 $0.11 $0.12 $0.43
Diluted $0.10 $0.09 $0.10 $0.11 $0.40
- ----------------------------------------------------------------------------------------------------
Average Common Shares Outstanding(1):
Basic
Diluted 11,832,560 11,149,728 11,096,134 11,473,118 11,387,885
11,962,835 11,784,033 12,317,569 12,556,799 12,155,226
- ----------------------------------------------------------------------------------------------------
</TABLE>
(1) Adjusted for 3:2 stock split distributed in June 2000.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
Not applicable.
28
<PAGE>
PART III
ITEM 10. EXECUTIVE OFFICERS AND DIRECTORS OF REGISTRANt
As of March 15, 2001, our executive officers and directors were as
follows:
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
Name Position
- ----------------------------------------------------------------------------------------------------------
<S> <C>
Jean Madar Chairman of the Board, Chief Executive Officer of Inter Parfums, Inc. and
Director General of Inter Parfums, S.A.
- ----------------------------------------------------------------------------------------------------------
Philippe Benacin Vice Chairman of the Board, President of Inter Parfums, Inc. and
President of Inter Parfums, S.A.
- ----------------------------------------------------------------------------------------------------------
Russell Greenberg Director, Executive Vice President and Chief Financial Officer
- ----------------------------------------------------------------------------------------------------------
Francois Heilbronn Director
- ----------------------------------------------------------------------------------------------------------
Joseph A. Caccamo Director
- ----------------------------------------------------------------------------------------------------------
Jean Levy Director
- ----------------------------------------------------------------------------------------------------------
Robert Bensoussan-Torres Director
- ----------------------------------------------------------------------------------------------------------
Daniel Piette Director
- ----------------------------------------------------------------------------------------------------------
Jean Cailliau Director
- ----------------------------------------------------------------------------------------------------------
Philippe Santi Director and Director of Finance, Inter Parfums, S.A.
- ----------------------------------------------------------------------------------------------------------
Serge Rosinoer Director
- ----------------------------------------------------------------------------------------------------------
Bruce Elbilia Executive Vice President
- ----------------------------------------------------------------------------------------------------------
Wayne Hamerling Executive Vice President
- ----------------------------------------------------------------------------------------------------------
Eric de Labouchere Director of Operations, Inter Parfums, S.A.
- ----------------------------------------------------------------------------------------------------------
Frederic Garcia-Pelayo Director of Export Sales, Inter Parfums, S.A.
- ----------------------------------------------------------------------------------------------------------
</TABLE>
The directors will serve until the next annual meeting of stockholders
and thereafter until their successors shall have been elected and qualified. LV
Capital USA, Inc. and Messrs. Jean Madar and Philippe Benacin have entered into
a Shareholders' Agreement relating to certain corporate governance issues,
including increasing the number of Board members from seven to ten, granting
two seats on the Board of directors to designees of LV Capital. LV Capital USA,
Inc. and Messrs. Jean Madar and Philippe Benacin have each agreed to vote for
each others nominees for directors. The number of members of our Board of
Directors was increased to 11 by the addition of Serge Rosinoer in December
2000 by the unanimous vote of our board.
With the exception of Mr. Benacin, the officers are elected annually by
the directors and serve at the discretion of the board of directors. There are
no family relationships between executive officers or directors of our company.
The following sets forth biographical information as to the business
experience of each executive officer and director of our company for at least
the past five years.
JEAN MADAR
Jean Madar, age 40, a Director, has been the Chairman of the Board of
Directors since the Company's inception, and is a co-founder of the Company with
Mr. Benacin. From inception until December 1993 he was the President of the
Company; in January 1994 he became Director General of Inter Parfums, S.A., the
Company's subsidiary; and in January 1997 he became Chief
29
<PAGE>
Executive Officer of the Company. Mr. Madar was previously the managing
director of Inter Parfums, S.A., from September 1983 until June 1985. At such
subsidiary, he had the responsibility of overseeing the marketing operations of
its foreign distribution, including market research analysis and actual
marketing campaigns. Mr. Madar graduated from The French Higher School of
Economic and Commercial Sciences (ESSEC) in 1983.
PHILIPPE BENACIN
Mr. Benacin, age 42, a Director, has been the Vice Chairman of the
Board since September 1991, and is a co-founder of the Company with Mr. Madar.
He was elected the Executive Vice President in September 1991, Senior Vice
President in April 1993, and President of the Company in January 1994. In
addition, he has been the President of Inter Parfums, S.A. for more than the
past five years. Mr. Benacin graduated from The French Higher School of Economic
and Commercial Sciences (ESSEC) in 1983.
RUSSELL GREENBERG
Mr. Greenberg, age 44, the Chief Financial Officer, was Vice-President,
Finance when he joined the Company in June 1992; became Executive Vice President
in April 1993; and was appointed to the Board of Directors in February 1995. He
is a certified public accountant licensed in the State of New York, and is a
member of the American Institute of Certified Public Accountants and the New
York State Society of Certified Public Accountants. After graduating from The
Ohio State University in 1980, he was employed in public accounting until he
joined the Company in June 1992.
FRANCOIS HEILBRONN
Mr. Heilbronn, age 40, a Director since 1988 and a member of the audit,
stock option and executive compensation committees, is a graduate of Harvard
Business School with a Master of Business Administration degree and is currently
the managing partner of the consulting firm of M.M. Friedrich, Heilbronn &
Fiszer. He was formerly employed by The Boston Consulting Group, Inc. from 1988
through 1992 as a manager. Mr. Heilbronn graduated from Institut D' Etudes
Politiques De Paris in June 1983. From 1984 to 1986, he worked as a financial
analyst for Lazard Freres & Co.
JOSEPH A. CACCAMO
Mr. Caccamo, age 45, a Director since 1992, is an attorney with the law
firm of Becker & Poliakoff, P.A., our general counsel. A member of both the New
York and Florida bars, Mr. Caccamo has been a practicing attorney since 1981,
concentrating in the areas of corporate and securities law, and in September
1991 he became counsel to us. From August 1992 through September 1997, he was a
director of and general counsel to, Hydron Technologies, Inc., a company
primarily engaged in the development of cosmetic and personal care products.
30
<PAGE>
JEAN LEVY
Jean Levy, age 68, a Director since August 1996 and a member of the
audit, stock option and executive compensation committees, worked for
twenty-seven years at L'Oreal, and was the President and Chief Executive Officer
of Cosmair, the exclusive United States licensee of L'Oreal, from 1983 through
June 1987. In addition, he is the former President and Chief Executive Officer
of Sanofi Beaute (France). For the more than the past five years, Mr. Levy has
been an independent advisor as well as a consultant for economic development to
local governments in France. A graduate of "l'Institut d'Etudes Politiques de
Paris," he also attended Yale Graduate School and was a recipient of a Fulbright
Scholarship. He was also a Professor at "l'Institut d'Etudes Politiques de
Paris". Mr. Levy is also a director of the following foreign public companies:
Escada Beaute Worldwide (a subsidiary of Escada Group), Rallye, S.A. and Zannier
Group. In addition, Mr. Levy is also the Chairman of the Board of Financiere
d'Or, and its subsidiary, Histoire d'Or which is in the retail jewelry business.
ROBERT BENSOUSSAN-TORRES
Robert Bensoussan-Torres, age 43, has been a Director since March 1997.
He is currently the Managing Director of Gianfranco Ferre fashion group, based
in Milano, Italy. Mr. Bensoussan-Torres was a Director of Towers Consulting
Europe, Ltd. from May 1998 to September 1999. Towers Consulting Europe, Ltd. is
a consulting company based in London, which specializes in strategic advise in
connection with mergers and acquisitions in the luxury goods business. Mr.
Bensoussan-Torres was the Chief Executive Officer of Christian Lacroix, Paris, a
subsidiary of LVMH Group, from February 1993 until May 1998. Christian Lacroix
is a French Houte Couture House and has activities in the field of apparel,
accessories and fragrances. From December 1990 through January 1993 he was based
in Munich, Germany, as the International Sales Director of The Escada Group.
DANIEL PIETTE
Mr. Piette, age 55 and a director since December 1999, is also a member
of the executive compensation committee of the Board of Directors. Mr. Piette is
the Chairman of LV Capital USA, Inc. ("LV Capital"), the US vehicle of LV
Capital SA, which is the investment arm of LVMH Moet Hennessy Louis Vuitton S.A.
("LVMH") the world's largest luxury goods conglomerate. For the past ten (10)
years, he has been a Group Executive Vice President of LVMH. Mr. Piette is also
a director of Cryo Interactive Entertainment (Paris) and a non-executive
director of Davis S. Smith Holdings PLC (London) as well as a member of the
Board of Overseers of ESSEC (Paris) and Columbia Business School (New York).
JEAN CAILLIAU
Mr. Cailliau, age 38 and a director since December 1999, is also a
member of the audit and the stock option committees of the Board of Directors.
Mr. Cailliau is the Deputy General Manager of LV Capital SA, the investment arm
of LVMH and the CEO of LV Capital USA Inc., its US vehicle. For the past eight
(8) years, Mr. Cailliau has held executive positions at LVMH.
31
<PAGE>
He is also a Director of various European companies. Mr. Cailliau is an Engineer
in Agronomics and has an MBA (1988) from Insead.
SERGE ROSINOER
Mr. Rosinoer, age 68, was appointed to the Board of Directors in
December 2000. Mr. Rosinoer has devoted most of his career to the personal care,
cosmetics and fragrance industry. In 1978, Mr. Rosinoer joined the Clarins Group
as Vice President and Chief Operating Officer where he was largely responsible
for its rapid international expansion. As COO, then CEO since 1978, Mr. Rosinoer
oversaw the transformation of Clarins into a major force in cosmetics, skin care
and fragrance, with annual sales of 4 billion French francs and more than 4,000
employees. He retired from active duty in June of 2000, but continues to serve
on the board of directors of Clarins. Earlier in his career he was President of
Parfums Corday. He also held senior level executive positions at Max Factor,
where he had full supervision of that cosmetics giant's European production and
sales. Mr. Rosinoer has served several terms as President of the French Prestige
Cosmetics Association and currently serves as Conseiller du Commerce Exterieur
de la France.
BRUCE ELBILIA
Mr. Elbilia, age 42, Executive Vice President, joined the Company in
June 1986 as the National Sales Director, and from that time until 1994, he was
in charge of the Company's marketing efforts. In 1994 Mr. Elbilia became head of
international sales and marketing for the Company, and had expanded the
Company's export sales to South America, the Middle East and Eastern Europe. Mr.
Elbilia received a Bachelor of Business Administration degree, with a major in
International Business/Marketing from George Washington University in
Washington, D.C.
WAYNE C. HAMERLING
Mr. Hamerling, age 44, was Vice President, Sales, from May 1987 through
April 1993, when he became Executive Vice President. Mr. Hamerling has over
twenty (20) years experience in the fragrance and cosmetic business. Mr.
Hamerling, who attended Rutgers University, has also been actively involved in
marketing of our United States mass market business for the past three (3)
years, and helped develop our Aziza II line and our new health and beauty aid
line.
PHILIPPE SANTI
Philippe Santi, age 39 and a Director since December 1999, has been the
Director of Finance and the Chief Financial Officer of Inter Parfums, S.A. since
February 1995. Mr. Santi is a Certified Accountant and Statutory Auditor in
France.
32
<PAGE>
ERIC DE LABOUCHERE
Eric de Labouchere, age 46, is the Director of Operations of Inter
Parfums, S.A. He has been employed by Inter Parfums, S.A. since October 1986 in
product development, purchasing and marketing.
FREDERIC GARCIA-PELAYO
Frederic Garcia-Pelayo, age 42, has been the Director of Export Sales
of Inter Parfums, S.A. since September 1994. Prior to September 1994,
Mr. Garcia-Pelayo was the Export Manager for Benetton Perfumes for seven (7)
years.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely upon a review of Forms 3, 4 and 5 and any amendments to
such forms furnished to us, and written representations from various reporting
persons furnished to us, we are not aware of any reporting person who has failed
to file the reports required to be filed under Section 16(a) of the Securities
Exchange Act of 1934 on a timely basis.
ITEM 11. EXECUTIVE COMPENSATION
The following table sets forth a summary of all compensation awarded
to, earned by or paid to, our Chief Executive Officer and each of the four most
highly compensated executive officers of our company whose compensation exceeded
$100,000 per annum for services rendered in all capacities to our company and
its subsidiaries during fiscal years ended 31 December 2000, 31 December 1999
and 31 December 1998:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM AWARDS
- -----------------------------------------------------------------------------------------------------------------
OTHER ANNUAL SECURITIES
COMPENSATION UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) ($) OPTIONS (#)(1) COMPENSATION
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Jean Madar, Chairman of the Board, 2000 280,000 100,000 273,000(3) -0-(3A) -0-
Chief Executive Officer of Inter 1999 280,000 48,000 765,500(4) 412,500 -0-
Parfums, Inc. and Director General 1998 280,000 -0- 53,000(5) 195,000 -0-
of Inter Parfums, S.A
- -----------------------------------------------------------------------------------------------------------------
Philippe Benacin(6), President of 2000 117,318 65,642 278,000(7) -0-(3A) -0-
Inter Parfums, Inc. and President 1999 136,000 16,000 765,500(8) 412,500
of Inter Parfums, S.A 1998 139,000 10,000 53,000(9) 195,000
- -----------------------------------------------------------------------------------------------------------------
Russell Greenberg(10), Executive 2000 245,000 13,000 69,174(11) 12,000 -0-
Vice President and Chief Financial 1999 230,000 5,000 225,819(12) 49,500 -0-
Officer 1998 228,446 3,000 2,214 23,250 -0-
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
33
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------------------------
Bruce Elbilia(13), Executive Vice 2000 178,000 10,000 24,752(14) 12,000 -0-
President 1999 160,500 5,000 262,467(15) 49,500 -0-
1998 146,045 3,000 8,776(16) 23,250 -0-
- -----------------------------------------------------------------------------------------------------------------
Wayne C. Hamerling(17), Executive 2000 176,120 10,000 111,438(18) 12,000 -0-
Vice President 1999 166,120 13,000 326,682(19) 49,500 -0-
1998 166,120 7,000 52,590(20) 23,250 -0-
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
[Footnotes to Table]
- ------------------------------------
(1) Adjusted to reflect a 3:2 stock split distributed in June 2000. Includes
options granted in 1998 as replacements for out-of-the-money or expired
options.
(2) As of 31 December 2000, Mr. Madar held 3,600,974 restricted shares of
common stock, with an aggregate value of $32,183,705 based upon the closing
price of our company's common stock as reported by the Nasdaq Stock Market,
National Market system, of $8.9375.
(3) Consists of lodging expenses of $48,000 and $225,000 realized upon exercise
of options.
(3A) Options to purchase 5,334 shares of Inter Parfums, S.A. were granted.
(4) Consists of lodging expenses of $ 48,000 and $708,500 realized upon
exercise of options.
(5) Consists of lodging expenses.
(6) Compensation figures for Mr. Benacin are approximate, as he is paid in
French francs, and conversion into U.S. dollars was made at the average
exchange rates prevailing during the respective periods. As of 31 December
2000, Mr. Benacin held 3,387,074 restricted shares of common stock, with an
aggregate value of $30,271,973 based upon the closing price of our
company's common stock as reported by the Nasdaq Stock Market, National
Market system, of $8.9375.
(7) Consists of lodging expenses of $38,000, $15,000 for automobile expenses
and $225,000 realized upon exercise of options.
(8) Consists of lodging expenses of $42,000, $15,000 for automobile expenses
and $708,500 and realized upon exercise of options.
(9) Consists of $48,000 for lodging expenses and $5,000 for automobile
expenses.
(10) As of 31 December 2000, Mr. Greenberg held 15,000 restricted shares of
common stock, with an aggregate value of $134,063 based upon the closing
price of our company's common stock as reported by the Nasdaq Stock Market,
National Market system, of $8.9375.
(11) Consists of $2,214 for automobile expenses and $67,500 realized upon
exercise of options.
(12) Consists of $2,214 for automobile expenses and $223,605 realized upon the
exercise of options.
(13) As of 31 December 2000, Mr. Elbilia held 15,000 restricted shares of common
stock, with an aggregate value of $134,063 based upon the closing price of
our company's common stock as reported by the Nasdaq Stock Market, National
Market system, of $8.9375.
(14) Consists of selling commissions.
(15) Consists of $27,985 selling commissions and $234,482 realized upon the
exercise of options.
(16) Consists of selling commissions.
(17) As of 31 December 2000, Mr. Hamerling held 15,000 restricted shares of
common stock, with an aggregate value of $134,063 based upon the closing
price of our company's common stock as reported by the Nasdaq Stock Market,
National Market system, of $8.9375.
(18) Consists of selling commissions of $54,438; non cash compensation of $4,500
equal to the value of personal use of a company leased automobile; and
$52,500 realized upon the exercise of options.
(19) Consists of selling commissions of $43,388; non cash compensation of $4,500
equal to the value of personal use of a company leased automobile; and
$278,794 realized upon the exercise of options.
(20) Consists of selling commissions of $48,090 and non cash compensation of
$4,500 equal to the value of personal use of a company leased automobile.
The following table sets forth certain information relating to stock option
grants during Fiscal 2000 to our Chief Executive Officer and each of the four
most highly compensated executive officers of the company whose compensation
exceeded $100,000 per annum for services rendered in all capacities to our
company and its subsidiaries during Fiscal 2000:
34
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZED VALUE AT
ASSUMED ANNUAL RATES OF
INDIVIDUALIZED GRANTS PRICE APPRECIATION FOR OPTION TERM
- ----------------------------------------------------------------------------------------------------------------------
NAME NUMBER OF % OF TOTAL EXERCISE EXPIRATION FIVE (5%) TEN (10%)
SECURITIES OPTIONS/SARS OR BASE DATE PERCENT PERCENT
UNDERLYING GRANTED TO PRICE ($) ($)
OPTIONS EMPLOYEES IN ($/SH)
GRANTED (#) FISCAL YEAR
<S> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
Jean Madar -0- NA NA NA NA NA
- ----------------------------------------------------------------------------------------------------------------------
Philippe Benacin -0- NA NA NA NA NA
- ----------------------------------------------------------------------------------------------------------------------
Russell Greenberg 12,000 11.8 7.625 26 Oct 05 25,280 55,862
- ----------------------------------------------------------------------------------------------------------------------
Bruce Elbilia 12,000 11.8 7.625 26 Oct 05 25,280 55,862
- ----------------------------------------------------------------------------------------------------------------------
Wayne Hamerling 12,000 11.8 7.625 26 Oct 05 25,280 55,862
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
The following table sets forth certain information relating to option
exercises effected during Fiscal 2000, and the value of options held as of such
date by each of our Chief Executive Officer and the four most highly compensated
executive officers of our company whose compensation exceeded $100,000 per annum
for services rendered in all capacities to our company and its subsidiaries
during Fiscal 2000:
AGGREGATE OPTION EXERCISES FOR FISCAL 2000
AND YEAR END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED VALUE(1) OF UNEXERCISED
OPTIONS AT DECEMBER 31, IN-THE-MONEY OPTIONS AT
2000(#) DECEMBER 31, 2000($)
- ----------------------------------------------------------------------------------------------------------------------
NAME SHARES ACQUIRED VALUE ($) EXERCISABLE/ EXERCISABLE/
ON EXERCISE REALIZED(2) UNEXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
Jean Madar 75,000 225,000 1,145,250/-0- 5,705,897/-0-
- ----------------------------------------------------------------------------------------------------------------------
Philippe Benacin 75,000 225,000 1,145,250/-0- 5,705,897/-0-
- ----------------------------------------------------------------------------------------------------------------------
Russell Greenberg 15,000 67,500 69,750/-0- 287,641/-0-
- ----------------------------------------------------------------------------------------------------------------------
Bruce Elbilia -0- -0- 12,000/-0- 15,750/-0-
- ----------------------------------------------------------------------------------------------------------------------
Wayne C. Hamerling 15,000 52,500 60,000/-0- 242,750/-0-
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Total value of unexercised options is based upon the fair market value of
the common stock as reported by the Nasdaq Stock Market of $8.9375 on 31
December 31 2000.
(2) Value realized in dollars is based upon the difference between the fair
market value of the common stock on the date of exercise, and the exercise
price of the option.
35
<PAGE>
EMPLOYMENT AGREEMENTS
As part of our acquisition in 1991 of the controlling interest in Inter
Parfums, S.A., now a subsidiary, we entered into an employment agreement with
Philippe Benacin. The agreement provides that Mr. Benacin will be employed as
Vice Chairman of the Board and President and Chief Executive Officer of Inter
Parfums Holdings and its subsidiary, Inter Parfums. The initial term expired on
September 2, 1992, and has subsequently been automatically renewed for
additional annual periods. The agreement provides for automatic annual renewal
terms, unless either party terminates the agreement upon 120 days notice. Mr.
Benacin presently receives an annual salary of 864,000ff, which is approximately
US$ 123,000, together with annual lodging expenses of approximately $38,000 and
automobile expenses of approximately $15,000, which are subject to increase in
the discretion of the Board of Directors. The agreement also provides for
indemnification and a covenant not to compete for one year after termination of
employment.
COMPENSATION OF DIRECTORS
All nonemployee directors receive $1,000 for each board meeting at which they
participate. Mr. Caccamo's board fees are paid to his law firm.
In March 1997 our Board of Directors adopted our 1997 Nonemployee Stock
Option Plan. This plan was approved by our stockholders at the annual meeting of
shareholders held in July 1997. The purpose of this plan is to assist us in
attracting and retaining key directors who are responsible for continuing the
growth and success of our company
Our 1997 Nonemployee Stock Option Plan provides for the grant of
nonqualified stock options to nonemployee directors to purchase an aggregate of
25,000 shares of common stock. Options to purchase 1,000 shares are granted on
each February 1st to all nonemployee directors for as long as each is a
nonemployee director on such date except for Joseph A. Caccamo, who is granted
options to purchase 4,000 shares. Options to purchase 2,000 shares are granted
to each nonemployee director upon his initial election or appointment to our
board.
On 19 December 2000 we granted options to purchase 2,000 shares at
$8.72 per share, the fair market value at the time of grant, to Mr. Serge
Rosinoer, for a five year period, upon his initial appointment to the Board. We
made these grants in accordance with the terms of our 1997 Nonemployee Stock
Option Plan, and our 2000 Nonemployee Stock Option Plan.
In December 2000 our Board of Directors adopted our 2000 Nonemployee
Stock Option Plan, as substantially all of the shares reserved under our 1997
Nonemployee Stock Option Plan had been allocated to outstanding options. This
plan is subject to the approval of our stockholders at the annual meeting of
shareholders to be held in 2001. The purpose of this plan is to assist us in
attracting and retaining key directors who are responsible for continuing the
growth and success of our company.
Our 2000 Nonemployee Stock Option Plan provides for the grant of
nonqualified stock options to nonemployee directors to purchase an aggregate of
30,000 shares of common stock.
36
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Options to purchase 1,000 shares are granted on each February 1st to all
nonemployee directors for as long as each is a nonemployee director on such date
except for Joseph A. Caccamo, who is granted options to purchase 4,000 shares.
Options to purchase 2,000 shares are granted to each nonemployee director upon
his initial election or appointment to our board.
On 1 February 2001, options to purchase 1,000 shares were granted to
each of Francois Heilbronn, Jean Levy, Robert Bensoussan-Torres, Daniel Piette
and Jean Cailliau, and an option to purchase 4,000 shares was granted to Joseph
A. Caccamo at the exercise price of $9.75 per share under the 2000 plan. The
options held by Mr. Caccamo are held as nominee for his past and present law
firms.
Joseph A. Caccamo, a director, was a partner of Nason, Yeager, Gerson,
White & Lioce, P.A., our prior general counsel. In Fiscal 2000, we paid Mr.
Caccamo's prior firm an aggregate of $109,121 in legal fees and for
reimbursement of disbursements incurred on our behalf. Also during 2000, Mr.
Caccamo received $28,487 as the result of the exercise and sale of shares
underlying options granted in Inter Parfums, S.A.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information, as of March 15, 2001 with
respect to the beneficial ownership of our common stock by (a) each person we
know to be the beneficial owner of more than five percent of our outstanding
common stock, (b) our executive officers and directors and (c) all of our
directors and officers as a group:
NAME AND ADDRESS AMOUNT OF BENEFICIAL APPROXIMATE PERCENT OF
OF BENEFICIAL OWNER OWNERSHIP(1) CLASS
- -------------------------------------------------------------------------------
Jean Madar 4,706,974(2) 36.8%
c/o Inter Parfums, S.A.
4, Rond Point Des Champs Elysees
75008 Paris, France
- -------------------------------------------------------------------------------
Philippe Benacin 4,493,074(3) 35.2%
c/o Inter Parfums, S.A.
4, Rond Point Des Champs Elysees
75008 Paris, France
- -------------------------------------------------------------------------------
(1) All shares of common stock are directly held with sole voting power and
sole power to dispose, unless otherwise stated. Jean Madar, the Chairman of
the Board and Chief Executive Officer of Inter Parfums, Inc. (the
"Company"), Philippe Benacin, the Vice Chairman of the Board and President
of the Company, and LV Capital USA, Inc., an indirect subsidiary of LVMH
Moet Hennessy Louis Vuitton, S.A., have entered into a Shareholders'
Agreement dated 22 November 1999 relating to certain corporate governance
issues, including the agreement to vote for Jean Madar, Philippe Benacin
and six (6) nominees of Messrs. Madar and Benacin, and two (2) designees of
LV Capital USA, INC., as directors of the Company.
(2) Consists of 3,561,724shares held directly and options to purchase 1,145,250
shares.
(3) Consists of 3,347,824shares held directly and options to purchase 1,145,250
shares.
37
<PAGE>
NAME AND ADDRESS AMOUNT OF BENEFICIAL APPROXIMATE PERCENT OF
OF BENEFICIAL OWNER OWNERSHIP(1) CLASS
- -------------------------------------------------------------------------------
Russell Greenberg 84,750(4) Less than 1%
c/o Inter Parfums, Inc.
551 Fifth Avenue
New York, NY 10176
- -------------------------------------------------------------------------------
Francois Heilbronn 12,225(5) Less than 1%
60 Avenue de Breteuil
75007 Paris, France
- -------------------------------------------------------------------------------
Joseph A. Caccamo, Esq. 10,000(6) Less than 1%
Becker & Poliakoff, P.A.
3111 Stirling Road
Ft. Lauderdale, FL 33312
- -------------------------------------------------------------------------------
Jean Levy 5,500(7) Less than 1%
29 rue du Colisee
75008 Paris, France
- -------------------------------------------------------------------------------
Robert Bensoussan-Torres 5,500(8) Less than 1%
48, Boulevard Raspail
75006 Paris, France
- -------------------------------------------------------------------------------
Bruce Elbilia 27,000(9) Less than 1%
c/o Inter Parfums, Inc.
551 Fifth Avenue
New York, NY 10176
- -------------------------------------------------------------------------------
Wayne C. Hamerling 75,000(10) Less than 1%
c/o Inter Parfums, Inc.
551 Fifth Avenue
New York, NY 10176
- -------------------------------------------------------------------------------
Daniel Piette 3,000(11) Less than 1%
LV Capital
30 Avenue Hoche
75008, Paris, France
- -------------------------------------------------------------------------------
Jean Cailliau 3,000(12) Less than 1%
LV Capital
30 Avenue Hoche
75008, Paris, France
- -------------------------------------------------------------------------------
- ----------------
(4) Consists of 15,000 shares held directly and 69,750 shares of common stock
underlying options.
(5) Consists of 6,725 shares held directly and 5,500 shares of common stock
underlying options.
(6) Consists of shares of common stock underlying options, which are held as
nominee for his past and present employer. Beneficial ownership of such
shares is disclaimed.
(7) Consists of shares of common stock underlying options.
(8) Consists of shares of common stock underlying options.
(9) Consists of 15,000 shares held directly and 12,000 shares of common stock
underlying options.
(10) Consists of 15,000 shares held directly and 60,000 shares of common stock
underlying options.
(11) Consists of shares of common stock underlying options. Beneficial ownership
of shares of common stock held by LV Capital USA, Inc. is disclaimed.
38
<PAGE>
NAME AND ADDRESS AMOUNT OF BENEFICIAL APPROXIMATE PERCENT OF
OF BENEFICIAL OWNER OWNERSHIP(1) CLASS
- -------------------------------------------------------------------------------
Philippe Santi -0- NA
Inter Parfums, S.A.
4, rond point des Champs Elysees
75008, Paris France
- -------------------------------------------------------------------------------
Serge Rosinoer 2,000(13) Less than 1%
14 rue LeSueur
75116 Paris, France
- -------------------------------------------------------------------------------
Eric de Labouchere -0- NA
Inter Parfums, S.A.
4, rond point des Champs Elysees
75008, Paris France
- -------------------------------------------------------------------------------
Frederic Garcia-Pelayo -0- NA
Inter Parfums, S.A.
4, rond point des Champs Elysees
75008, Paris France
- -------------------------------------------------------------------------------
LV Capital USA, Inc.
19 E. 57th Street 2,435,700 20.9%
New York, NY 10022
- -------------------------------------------------------------------------------
Dimensional Fund Advisors, Inc. 823,800(14) 7.2%
1299 Ocean Avenue, 11th Fl.
Santa Monica, CA 90401
- -------------------------------------------------------------------------------
All Directors and Officers 11,863,723(15) 84.2%
as a Group (15 Persons)
- -------------------------------------------------------------------------------
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
TRANSACTIONS WITH FRENCH SUBSIDIARIES
In connection with the acquisitions by our subsidiary, Inter Parfums,
S.A., of the world-wide rights under the Burberry license agreement, the Paul
Smith license agreement and the Brosseau license agreement, we guaranteed the
obligations of Inter Parfums, S.A. under the
- -------------------------------------------------------------------------------
(12) Consists of shares of common stock underlying options. Beneficial ownership
of shares of common stock held by LV Capital USA, Inc. is disclaimed.
(13) Consists of shares of common stock underlying options.
(14) Information is derived forth in a Schedule 13G dated 2 February 2001 of
Dimensional Fund Advisor Inc., which may be deemed to be the beneficial
owner of the shares which are owned by its advisory clients. Dimensional
Fund Advisor disclaims beneficial ownership of all of the shares.
(15) Consists of 9,396,973 shares held directly, and options to purchase
2,466,750 shares. It also includes 2,435,700 shares held by LV Capital USA,
Inc., an affiliate of LVMH Moet Hennessy Louis Vuitton, S.A.
39
<PAGE>
Burberry license agreement and the Paul Smith license agreement and the
distribution agreement for Ombre Rose fragrances.
REMUNERATION OF COUNSEL
Joseph A. Caccamo, a director of our company, was a partner of Nason,
Yeager, Gerson, White & Lioce, P.A., our prior general counsel. In Fiscal 2000,
we paid Mr. Caccamo's prior firm an aggregate of $109,121 in legal fees and for
reimbursement of disbursements incurred on our behalf. Also during 2000, Mr.
Caccamo received $28,487 as the result of the exercise and sale of shares
underlying options granted in Inter Parfums, S.A.
Commencing 1 February 2001, Mr. Caccamo's joined the law firm of Becker
& Poliakoff, P.A., which receives a monthly retainer of $8,000 together with
reimbursement for expenses. Mr. Caccamo's firm also receives $1,000 for each
board meeting at which he participates.
On 1 February 1, 2001 in accordance with the terms of our 2000
Nonemployee Stock Option Plan, Mr. Caccamo was granted an option with a term of
five years to purchase 4,000 shares at $9.75 per share, the fair market value at
the time of grant. He holds this option as nominee for his firm.
TRANSACTIONS WITH LVMH MOET HENNESSY LOUIS VUITTON S.A.
ACQUISITION OF COMMON STOCK AND SHAREHOLDERS' AGREEMENT
In November 1999, LV Capital, USA Inc. ("LV Capital"), a wholly-owned
subsidiary of LVMH Moet Hennessy Louis Vuitton S.A., purchased an aggregate of
1,273,800 shares of our common stock from management and employees, and
increased its beneficial ownership of our common stock to approximately 20.5% of
our outstanding shares. Further, in return for LV Capital becoming our strategic
partner, LV Capital was granted the right to buy additional shares in order to
maintain its percentage ownership upon issuance of shares to third parties,
subject to certain exceptions, and was granted demand registrations rights for
all of its shares. In addition, LV Capital has agreed to a standstill agreement,
which limits the amount of shares of common stock that LV Capital can hold to
twenty-five percent (25%) of our outstanding shares.
CELINE
In May 2000 we entered into an exclusive worldwide license agreement
with Celine, S.A., a division of LVMH Moet Hennessy Louis Vuitton S.A., for the
development, manufacturing and distribution of prestige fragrance lines under
the Celine brand name. The term of the License Agreement is for eleven (11)
years, beginning as of 1 January 2001, with an optional five (5) year renewal
term, which is subject to certain minimum sales requirements, advertising
expenditures and royalty payments.
40
<PAGE>
In addition, Inter Parfums, S.A. began distributing Magic, Celine's
existing fragrance line, on 1 January 2001. We expect to launch two new
fragrance lines by the third quarter of this year.
CHRISTIAN LACROIX
In March 1999, we entered into an exclusive license agreement with the
Christian Lacroix Company, a division of LVMH Moet Hennessy Louis Vuitton S.A.,
for the worldwide development, manufacture and distribution of perfumes. The
license agreement has an 11 year term, and is subject to certain minimum sales
requirements, advertising expenditures and royalty payments.
41
<PAGE>
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a)(1) Financial Statements annexed hereto Page No.
Independent Auditors' Reports F-1
Consolidated Balance Sheets as at December 31, 2000
and December 31, 1999 F-3
Consolidated Statements of Income for the Years
ended December 31, 2000, December 31, 1999 and
December 31, 1998 F-4
Consolidated Statements of Changes in Shareholders' Equity
for the Years ended December 31, 2000, December 31, 1999
and December 1998 F-5
Consolidated Statements of Cash Flows for the Years ended
December 31, 2000, December 31, 1999 and December 31, 1998 F-6
Notes to Financial Statements F-7
(a)(2) Financial Statement Schedules annexed hereto:
Schedule II - Valuation and Qualifying Accounts
and Reserves F-18
Schedules other than those referred to above have been omitted as the
conditions requiring their filing are not present or the information
has been presented elsewhere in the consolidated financial statements.
42
<PAGE>
(a)(3) Exhibits
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - January 18, 1990), as follows:
EXHIBIT NO. AND DESCRIPTION
10.13 License Agreement between the Company and Jordache dated January 18, 1990
(as no. 10.1 therein).
10.15 Letter of Indemnification from Jordache to the Company dated January 18,
1990 (as no. 10.3 therein)
10.16 Letter Agreement from Jordache to the Company regarding foreign license
rights dated January 18, 1990 (as no. 10.4 therein).
The following document heretofore filed with the Commission is
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - July 29, 1991), as follows:
EXHIBIT NO. AND DESCRIPTION
10.24 Agreement and Plan of Reorganization dated July 29, 1991 among the
Company, Jean Madar and Philippe Benacin (as No. 10.1 therein)
The following document heretofore filed with the Commission is
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1991:
EXHIBIT NO. AND DESCRIPTION
10.25 Employment Agreement between the Company and Philippe Benacin dated July
29, 1991
The following documents heretofore filed with the Commission is
incorporated by reference to the Company's Registration Statement on Form S-1
(No. 33-48811):
EXHIBIT NO. AND DESCRIPTION
10.26 Lease for portion of 15th Floor, 551 Fifth Avenue, New York, New York
43
<PAGE>
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1992:
EXHIBIT NO. AND DESCRIPTION
4.10 Amendment to 1992 Stock Option Plan
4.11 1993 Stock Option Plan
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - July 15, 1993), as follows:
EXHIBIT NO. AND DESCRIPTION
10.30 License Agreement dated July 15, 1993, among Burberrys Limited, Inter
Parfums, S.A. and Jean Philippe Fragrances, Inc.(1)
10.31 License Agreement dated May 7, 1993, between Jean-Charles Brosseau, S.A.
and Inter Parfums, S.A. (original in French)(1)
10.32 License Agreement dated May 7, 1993, between Jean-Charles Brosseau, S.A.
and Inter Parfums, S.A.(translation of French into English)(1)
10.33 Agreement dated July 14, 1993, between Alfin, Inc. and Inter Parfums,
S.A.(1)
10.34 Agreement dated July 16, 1993 among Inter Parfums, S.A., Jean Philippe
Fragrances, Inc., C&C Beauty Sales, Inc. and Parfico, Inc.
10.35 Distribution Agreement dated July 16, 1993 among Inter Parfums, S.A., Jean
Philippe Fragrances, Inc. and Fragrance Marketing Group, Inc.(1)
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - February 28, 1994), as follows:
- ---------------------
(1) Filed in excised form.
44
<PAGE>
EXHIBIT NO. AND DESCRIPTION
10.36 Cession D'Elements Partiels de Fonds de Commerce between Inter Parfums,
S.A. and Cosmetiques et Parfums de France-I.D., S.A. dated February 18, 1994
(re: Parfums Molyneux)
10.37 Cession D'Elements Partiels de Fonds de Commerce between Inter Parfums,
S.A. and Cosmetiques et Parfums de France-I.D., S.A. dated February 18, 1994
(re: Parfums Weil)
10.38 Agreement (Acquisition) among Jean Philippe Fragrances, Inc., Inter
Parfums, S.A. and Cosmetiques et Parfums de France, S.A. dated February 18, 1994
10.39 Noncompetition Agreement among Jean Philippe Fragrances, Inc., Inter
Parfums, S.A. and Cosmetiques et Parfums de France-I.D., S.A. dated February 18,
1994
10.40 Commission Agreement among Jean Philippe Fragrances, Inc., Inter Parfums,
S.A. and Sodipe S.A. dated February 18, 1994
10.41 Convention between Inter Parfums, S.A. and Cosmetiques et Parfums de
France-I.D., S.A. dated February 18, 1994 (re inventory purchase)
10.42 Convention de Nantissement among Cosmetiques et Parfums de France, S.A.,
Cosmetiques et Parfums de France-I.D., S.A., Sodipe S.A., Jean Philippe
Fragrances, Inc. and Inter Parfums, S.A. dated February 18, 1994 (re security
agreement)
10.43 Convention among Cosmetiques et Parfums de France-I.D., S.A., Cosmetiques
et Parfums de France, S.A., Jean Philippe Fragrances, Inc. and Inter Parfums,
S.A. and Sodipe S.A. dated February 18, 1994 (re French regulatory requirements)
10.44 Acquisition Agreement among Jean Philippe Fragrances, Inc., Revlon
Consumer Products Corporation and Revlon Suisse, S.A. dated March 2, 1994
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Form 8 Amendment no. 1 (dated
March 14, 1994) to the Current Report on Form 8-K (date of event - February 28,
1994), as follows:
EXHIBIT NO. AND DESCRIPTION
10.46. English translation of exhibit no. 10.36, Cession D'Elements Partiels de
Fonds de Commerce between Inter Parfums, S.A. and Cosmetiques et Parfums de
France-I.D., S.A. dated February 18, 1994 (re: Parfums Molyneux)
10.47. English translation of exhibit no. 10.37, Cession D'Elements Partiels de
Fonds de Commerce between Inter Parfums, S.A. and Cosmetiques et Parfums de
France-I.D., S.A. dated February 18, 1994 (re: Parfums Weil)
45
<PAGE>
10.48. English translation of exhibit no. 10.41, Convention between Inter
Parfums, S.A. and Cosmetiques et Parfums de France-I.D., S.A. dated February 18,
1994 (re inventory purchase)
10.49. English translation of exhibit no. 10.42, Convention de Nantissement
among Cosmetiques et Parfums de France, S.A., Cosmetiques et Parfums de
France-I.D., S.A., Sodipe S.A., Jean Philippe Fragrances, Inc. and Inter
Parfums, S.A. dated February 18, 1994 (re security agreement)
The following document heretofore filed with the Commission is
incorporated herein by reference to the Company's Form 8 Amendment no. 2 (dated
March 21, 1994) to the Current Report on Form 8-K (date of event - February 28,
1994), as follows:
EXHIBIT NO. AND DESCRIPTION
10.50. English translation of exhibit no. 10.43, Convention among Cosmetiques et
Parfums de France-I.D., S.A., Cosmetiques et Parfums de France, S.A., Jean
Philippe Fragrances, Inc. and Inter Parfums, S.A. and Sodipe S.A. dated February
18, 1994 (re French regulatory requirements)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993:
EXHIBIT NO. AND DESCRIPTION
3.3 Articles of Incorporation of Inter Parfums Holding, S.A.
3.3.1 English Translation of Exhibit no. 3.3, Articles of Incorporation of Inter
Parfums Holding, S.A.
3.4 Articles of Incorporation of Inter Parfums, S.A.
3.4.1 English Translation of Exhibit no. 3.4, Articles of Incorporation of Inter
Parfums, S.A.
4.15 1994 Nonemployee Director Stock Option Plan
10.51 Traite D'Apport Partiel D'Actif dated July 30, 1993 (Reorganization
Agreement between Inter Parfums, S.A. and Selective Industrie, S.A.)
10.51.1 English translation of Exhibit no. 10.51, Traite D'Apport Partiel
D'Actif dated July 30, 1993 (Reorganization Agreement between Inter Parfums,
S.A. and Selective Industrie, S.A.)
46
<PAGE>
10.52 Lease for portion of 4, Rond Point Des Champs Des Elysees dated September
30, 1993
10.52.1 English translation of Exhibit no. 10.52, Lease for portion of 4, Rond
Point Des Champs Des Elysees dated September 30, 1993
10.53 Lease for portion of 4, Rond Point Des Champs Des Elysees dated March 2,
1994
10.53.1 English translation of Exhibit no. 10.53, Lease for portion of 4, Rond
Point Des Champs Des Elysees dated March 2, 1994
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1994:
4.16 1994 Nonemployee Director Supplemental Stock Option Plan (Listed as no.
4.15 therein)
10.59 Modification of Lease Agreement dated June 17, 1994 between Metropolitan
Life Insurance Company and Jean Philippe Fragrances, Inc.
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995:
EXHIBIT NO. AND DESCRIPTION
10.61 Lease for 60 Stults Road, South Brunswick, NJ between Forsgate Industrial
Complex, a limited partnership, and Jean Philippe Fragrances, Inc. dated July
10, 1995
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996:
EXHIBIT NO. AND DESCRIPTION
10.65 Asset Repurchase Agreement between Carson, Inc. and Jean Philippe
Fragrances, Inc. dated March 27, 1997
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997:
47
<PAGE>
EXHIBIT NO. AND DESCRIPTION
10.67 Second Modification of Lease made as of the 30th day of April, 1997
between Metropolitan Life Insurance Company as landlord and Jean Philippe
Fragrances, Inc. as tenant.
10.68 Amendment I to License Agreement dated September 3, 1997 between Jordache
Enterprises, Inc. as Licensor and Jean Philippe Fragrances, Inc. as Licensee.
10.69 Exclusive Licence Agreement dated June 20, 1997 between S.T. Dupont, S.A.
and Inter Parfums (English translation, excised version)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1998:
EXHIBIT NO. AND DESCRIPTION
3.2 Amended and Restated By-laws
4.17 1997 Nonemployee Director Stock Option Plan
4.18 1999 Stock Option Plan
10.70 Licence Agreement among Paul Smith Limited, Inter Parfums, S.A. and
Jean-Philippe Fragrances, Inc. (excised version)
10.71 Licence Agreement between Christian LaCroix, a division of Group LVMH and
Inter Parfums, S.A (English translation, excised version)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's current report on Form 8-K (date of
event - November 22, 1999):
EXHIBIT NO. AND DESCRIPTION
4.2 Shareholder's Agreement among LV Capital USA, Inc., Jean Mader and Philippe
Benacin dated November 22, 1999.
99.1 Stock Purchase Agreement among LV Capital USA, Inc., Jean Madar and
Philippe Benacin dated November 22, 1999.
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1999:
48
<PAGE>
EXHIBIT NO. AND DESCRIPTION
3.1.4 Amendment to the Company's Restated Certificate of Incorporation, as
amended, dated July 13, 1999 (listed therein as 3.1(d))
10.73 Burberry Confidential Treatment Agreement dated 8 February, 2000
10.74 Burberry Licence Amendment dated February, 2000 (filed in excised form)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's current report on Form 8-K/A no. 1
(date of event - 18 May 2000):
10.76 Celine License Agreement [in French]- excised.
10.76.1 Celine License Agreement [English translation]- excised.
The following document heretofore filed with the Commission is
incorporated by reference to the Company's current report on Form 8-K/A no. 1
(date of event - 23 June 2000):
10.77 Sublicense Agreement for FUBU Fragrances, dated June 22, 2000 -
excised.
The following document heretofore filed with the Commission is
incorporated by reference to the Company's quarterly report on Form 10-Q for the
period ending 30 June 2000:
3.1.5 Amendment to the Company's Restated Certificate of Incorporation, as
amended, dated 12 July 2000 (listed therein as 3.1(e))
49
<PAGE>
The following documents are filed herewith:
EXHIBIT NO. AND DESCRIPTION
3.1.1 Restated Certificate of Incorporation dated September 3, 1987
3.1.2 Amendment to the Company's Restated Certificate of Incorporation dated
July 31, 1992
3.1.3 Amendment to the Company's Restated Certificate of Incorporation dated
July 9, 1993
4.19 2000 Nonemployee Director Stock Option Plan
10.78 Revolving Credit Agreement dated June 1, 2000 between HSBC Bank USA and
Inter Parfums, Inc.
10.79 Bail [Lease] for 18 avenue Franklin Roosevelt, Paris France [French
Original]
10.79.1 Bail [Lease] for 18 avenue Franklin Roosevelt, Paris France [English
Translation]
10.80 Credit Lyonnais Letter Agreement dated 22 March 2001 - [French Original]
10.80.1 Credit Lyonnais Letter Agreement dated 22 March 2001 - [English
Translation]
10.81 Barclays Bank Letter Agreement dated 4 June 1998 - [French Original]
10.81.1 Barclays Bank Letter Agreement dated 4 June 1998 - [English Translation]
10.82 Banque OBC Odier Bungener Courvoisier Letter Agreement one dated 31 July
1998 - [French Original]
10.82.1 Banque OBC Odier Bungener Courvoisier Letter Agreement one dated 31 July
1998 - [English Translation]
10.83 Banque OBC Odier Bungener Courvoisier Letter Agreement two dated 31 July
1998 - [French Original]
10.83.1 Banque OBC Odier Bungener Courvoisier Letter Agreement two dated 31 July
1998 - [English Translation]
10.84 Banque Worms Letter Agreement dated 22 December 1997 - [French Original]
10.84.1 Banque Worms Letter Agreement dated 22 December 1997 - [English
Translation]
10.85 Credit Agricole D'Lile de France Letter Agreement dated 19 June 1996 -
[French Original]
10.85.1 Credit Agricole D'Lile de France Letter Agreement dated 19 June 1996 -
[English Translation]
21 List of Subsidiaries
(b) Reports on Form 8-K: None.
50
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors and Shareholders
Inter Parfums, Inc. and Subsidiaries
New York, New York
We have audited the accompanying consolidated balance sheets of Inter Parfums,
Inc. and subsidiaries as of December 31, 2000 and 1999, and the related
consolidated statements of income, changes in shareholders' equity and cash
flows for each of the years in the three-year period ended December 31, 2000.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits. We did not audit the financial statements of Inter Parfums
Holdings, S.A. and subsidiaries, consolidated subsidiaries of the Company, which
statements reflect total assets and net sales constituting 68% and 69% for 2000
and 66% and 69% for 1999 and net sales constituting 66% for 1998. Those
statements were audited by other auditors whose reports have been furnished to
us, and our opinion, insofar as it relates to the amounts for Inter Parfums
Holdings, S.A. and subsidiaries, is based solely on the reports of the other
auditors.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits and the reports of
the other auditors provide a reasonable basis for our opinion.
In our opinion, based on our audits and the reports of the other auditors, the
financial statements enumerated above present fairly, in all material respects,
the consolidated financial position of Inter Parfums, Inc. and subsidiaries as
of December 31, 2000 and 1999, and the consolidated results of their operations
and their consolidated cash flows for each of the years in the three-year period
ended December 31, 2000 in conformity with accounting principles generally
accepted in the United States of America.
Our audits referred to above included Schedule II for each of the years in the
three-year period ended December 31, 2000. In our opinion, such schedule
presents fairly the information set forth therein in accordance with the
applicable accounting regulations of the Securities and Exchange Commission.
Richard A. Eisner & Company, LLP
New York, New York
February 28, 2001
With respect to accounts for foreign subsidiaries
March 19, 2001
F-1
<PAGE>
INTER PARFUMS HOLDING, S.A. AND SUBSIDIARIES
--------------------------------------------
INDEPENDENT AUDITORS' REPORT
----------------------------
We have audited the accompanying consolidated balance sheets of Inter Parfums
Holding S.A. and subsidiaries as of December 31, 2000 and 1999, and the related
consolidated statements of income, shareholders' equity, and cash flows for the
year ended December 31, 2000, 1999 and 1998. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the consolidated financial statements enumerated above present
fairly, in all material respects, the financial position of Inter Parfums
Holding S.A. and subsidiaries as of December 31, 2000 and 1999, and the results
of their operations and their cash flows for the years ended December 31, 2000,
1999 and 1998 in conformity with accounting principles generally accepted in the
United States.
Paris La DeFense, March 19, 2001
Cabinet Cauvin, Angleys, Saint-Pierre
International
Rene Amirkhanian
F-2
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands except share and per share data)
DECEMBER 31,
--------------------
2000 1999
-------- --------
ASSETS
Current assets:
Cash and cash equivalents $ 27,599 $ 24,936
Marketable securities (Note B) 4,424
Accounts receivable, net of allowances of $2,067
and $2,095 in 2000 and 1999, respectively 30,844 26,033
Inventories (Notes A and C) 25,340 19,450
Receivables, other 497 875
Other 1,808 1,169
Deferred tax benefit (Note K) 435 858
-------- --------
Total current assets 86,523 77,745
Equipment and leasehold improvements, net (Notes A and D) 3,162 3,126
Other assets 347 508
Trademarks and licenses, net (Notes A, E and L) 4,539 5,844
-------- --------
$ 94,571 $ 87,223
======== ========
LIABILITIES
Current liabilities:
Loans payable - banks (Note F) $ 2,542 $ 787
Accounts payable 18,224 18,449
Accrued expenses 6,961 4,351
Income taxes payable 1,108 768
-------- --------
Total current liabilities 28,835 24,355
-------- --------
Deferred tax liability (Note K) 684 988
-------- --------
Long-term debt (Note G) 1,417 1,531
-------- --------
Minority interest 8,574 7,988
-------- --------
Commitments and contingencies (Notes H and L)
SHAREHOLDERS' EQUITY (Notes I and L)
Preferred stock, $.001 par value; authorized
1,000,000 shares; none issued
Common stock, $.001 par value; authorized
30,000,000 shares; outstanding 11,676,277 and
11,832,721 shares in 2000 and 1999, respectively 12 12
Additional paid-in capital 27,728 26,518
Retained earnings 58,669 52,080
Accumulated other comprehensive income (6,574) (4,290)
Treasury stock, at cost 5,736,405 and 5,392,805 shares
in 2000 and 1999, respectively (24,774) (21,959)
-------- --------
Total shareholders' equity 55,061 52,361
-------- --------
$ 94,571 $ 87,223
======== ========
SEE NOTES TO FINANCIAL STATEMENTS
F-3
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands except share and per share data)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------------------
2000 1999 1998
------------ ------------ ------------
<S> <C> <C> <C>
Net sales $ 101,582 $ 87,140 $ 89,388
Cost of sales 51,873 45,325 47,417
------------ ------------ ------------
Gross margin 49,709 41,815 41,971
Selling, general and administrative 37,509 31,965 32,944
Litigation expense 556
------------ ------------ ------------
Income from operations 11,644 9,850 9,027
------------ ------------ ------------
Other charges (income):
Interest 363 344 471
Loss on foreign currency 185 190 139
Interest income (1,065) (687) (788)
Realized (gain) on sale of marketable securities (1,396)
Loss on sale of stock of subsidiary 18 135 41
------------ ------------ ------------
(1,895) (18) (137)
------------ ------------ ------------
Income before income taxes 13,539 9,868 9,164
Income taxes 5,631 3,978 3,598
------------ ------------ ------------
Income before minority interest 7,908 5,890 5,566
Minority interest in net income of
consolidated subsidiary 1,319 1,062 953
------------ ------------ ------------
NET INCOME $ 6,589 $ 4,828 $ 4,613
============ ============ ============
NET INCOME PER SHARE:
BASIC $ 0.56 $ 0.43 $ 0.35
DILUTED $ 0.51 $ 0.40 $ 0.35
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:
BASIC 11,726,737 11,387,885 13,060,935
DILUTED 13,000,432 12,155,226 13,348,208
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
F-4
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(in thousands except share data)
<TABLE>
<CAPTION>
COMMON STOCK ADDITIONAL
--------------------- PAID-IN RETAINED COMPREHENSIVE
SHARES AMOUNT CAPITAL EARNINGS INCOME
------------ ------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
BALANCE - JANUARY 1, 1998 13,294,171 $ 13 $ 20,682 $ 42,730
Comprehensive income:
Net income 4,613 $ 4,613
Foreign currency translation adjustments 1,557
------------
Total comprehensive income $ 6,170
============
Shares issued upon exercise of stock options 11,250 1 44
Purchased treasury shares (611,250) (1)
------------ ----- ------------ ------------
BALANCE - DECEMBER 31, 1998 12,694,171 13 20,726 47,343
Comprehensive income:
Net income 4,828 $ 4,828
Foreign currency translation adjustments (3,870)
Unrealized gain on marketable securities 392
------------
Total comprehensive income $ 1,350
============
Shares issued upon exercise of stock options
(including income tax benefit) 956,550 1 5,792
Purchased treasury shares (1,818,000) (2)
Dividends paid (91)
------------ ----- ------------ ------------
BALANCE - DECEMBER 31, 1999 11,832,721 12 26,518 52,080
Comprehensive income:
Net income 6,589 $ 6,589
Foreign currency translation adjustments (1,892)
Reclassification adjustment for gains realized
in net income (392)
------------
Total comprehensive income $ 4,305
============
Shares issued upon exercise of stock options
(including income tax benefit) 187,156 1,210
Purchased treasury shares (343,600)
------------ ----- ------------ ------------
BALANCE - DECEMBER 31, 2000 11,676,277 $ 12 $ 27,728 $ 58,669
============ ===== ============ ============
<CAPTION>
ACCUMULATED
OTHER
COMPREHENSIVE TREASURY
INCOME STOCK TOTAL
------------ ------------ ------------
<S> <C> <C>
$ (2,369) $ (10,862) $ 50,194
4,613
1,557 1,557
45
(2,727) (2,728)
------------ ------------ ------------
(812) (13,589) 53,681
4,828
(3,870) (3,870)
392 392
5,793
(8,370) (8,372)
(91)
------------ ------------ ------------
(4,290) (21,959) 52,361
6,589
(1,892) (1,892)
(392) (392)
1,210
(2,815) (2,815)
------------ ------------ ------------
$ (6,574) $ (24,774) $ 55,061
============ ============ ============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
F-5
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
2000 1999 1998
-------- -------- --------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 6,589 $ 4,828 $ 4,613
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 2,362 2,415 1,401
Realized (gain) on sale of marketable securities (1,396)
Loss on sale of stock of subsidiary 18 135 41
Minority interest in net income of consolidated subsidiary 1,319 1,062 953
Deferred tax (benefit) provision 476 (438) 165
Changes in:
Accounts receivable (6,173) (886) (272)
Inventories (6,872) 354 632
Other assets (252) (66) (144)
Accounts payable and accrued expenses 3,753 6,873 (449)
Income taxes payable 412 (1,719) 419
-------- -------- --------
Net cash provided by operating activities 236 12,558 7,359
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equipment and leasehold improvements (1,580) (1,407) (1,604)
Cash portion of trademark and license acquisitions (337) (27)
Purchase of marketable securities (3,671) (3,792)
Proceeds from sale of marketable securities 8,325
-------- -------- --------
Net cash provided by (used in) investing activities 3,074 (5,536) (1,631)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase (decrease) in loans payable - banks 1,788 (2,997) 888
Proceeds from issuance of long-term debt 1,624
Proceeds from sale of stock of subsidiary 67 214 60
Purchase of treasury stock (2,815) (8,371) (2,728)
Proceeds from exercise of options and warrants 1,210 5,793 44
Dividends paid (135) (91)
-------- -------- --------
Net cash provided by (used in) financing activities 115 (3,828) (1,736)
-------- -------- --------
Effect of exchange rate changes on cash (762) (1,614) 642
-------- -------- --------
NET INCREASE IN CASH AND CASH EQUIVALENTS 2,663 1,580 4,634
Cash and cash equivalents - beginning of year 24,936 23,356 18,722
-------- -------- --------
CASH AND CASH EQUIVALENTS - END OF YEAR $ 27,599 $ 24,936 $ 23,356
======== ======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid for:
Interest $ 404 $ 330 $ 560
Income taxes $ 2,683 $ 4,331 $ 3,028
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
F-6
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE A - THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES
[1] BUSINESS OF THE COMPANY:
The Company is a manufacturer and distributor of prestige brand name
fragrances and mass market fragrances and cosmetics.
[2] BASIS OF PREPARATION:
The consolidated financial statements include the accounts of Inter
Parfums, Inc. and its domestic and foreign subsidiaries (the "Company")
including a subsidiary whose stock is publicly traded in France. All
material intercompany balances and transactions have been eliminated.
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities, disclosure of contingent assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
[3] FOREIGN CURRENCY TRANSLATION:
For foreign subsidiaries that operate in a foreign currency, assets and
liabilities are translated to U.S. dollars at year-end exchange rates.
Income and expense items are translated at average rates of exchange
prevailing during the year. Gains and losses from translation adjustments
are accumulated in a separate component of shareholders' equity. In
instances where the financial statements of foreign entities are remeasured
into their functional currency (U.S. dollars), the remeasurement adjustment
is recorded in operations.
[4] CASH EQUIVALENTS:
All highly liquid investments purchased with a maturity of three months or
less are considered to be cash equivalents.
[5] MARKETABLE SECURITIES:
All marketable securities are classified as available-for-sale and are
available to support current operations or to take advantage of other
investment opportunities. These securities are stated at fair value based
upon market quotes. Unrealized holding gains and losses, net of deferred
taxes, are computed on the basis of specific identification and are
reported as a separate component of shareholders' equity. Realized gains
and losses, and decreases in value, judged to be other than temporary, are
included in other charges (income). The cost of securities sold is based on
the specific identification method and interest and dividend income is
recognized when earned.
[6] FINANCIAL INSTRUMENTS:
The carrying amount of accounts receivable, other receivables, accounts
payable and accrued expenses approximates fair value due to the short terms
to maturity of these instruments. The carrying amount of loans payable and
long-term debt approximates fair value as the interest rates on the
Company's indebtedness approximate current market rates.
F-7
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE A - THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
[6] FINANCIAL INSTRUMENTS: (CONTINUED)
The Company occasionally enters into foreign currency forward exchange
contracts to manage exposure related to certain foreign currency
commitments. Gains and losses on foreign currency transaction hedges are
recognized in income and offset the foreign exchange gains and losses on
the underlying transactions. Gains and losses of foreign currency firm
commitment hedges are deferred and included in the basis of the
transactions underlying the commitment. At December 31, 2000, the Company
had foreign currency contracts in the form of forward exchange contracts in
the amount of approximately $9,000. The currencies included in these
contracts are principally the United States dollar and the British pound.
[7] EURO CONVERSION:
In January 1999, certain member countries of the European Union established
permanent fixed rates between their existing currencies and the European
Union's common currency (the "Euro"). The transition period for the
introduction of the Euro is scheduled to phase in over a period ending
January 1, 2002. The introduction of the Euro and the phasing out of the
other currencies should not have a material impact on the presentation of
data in the Company's consolidated financial statements.
[8] INVENTORIES:
Inventories are stated at the lower of cost (first-in, first-out) or
market.
[9] EQUIPMENT AND LEASEHOLD IMPROVEMENTS:
Equipment and leasehold improvements are stated at cost less accumulated
depreciation and amortization. Depreciation and amortization are provided
using the straight-line method and the declining-balance method over the
estimated useful asset lives for equipment, which range between three and
ten years and the shorter of the lease term or estimated useful asset lives
for leasehold improvements.
[10] TRADEMARKS AND LICENSES:
Trademarks are stated at cost and are amortized by the straight-line method
over 20 years. The cost of licenses acquired is being amortized by the
straight-line method over the term of the respective licenses.
The Company reviews trademarks and licenses for impairment whenever events
or changes in circumstances indicate that the carrying amount may not be
recoverable.
[11] REVENUE RECOGNITION:
Revenue is recognized upon shipment of merchandise as sales are final upon
shipment to customers. The Company, at its discretion, permits limited
returns of merchandise and establishes allowances for estimated returns
based upon historic trends.
[12] ISSUANCE OF COMMON STOCK OF SUBSIDIARY:
The difference between the Company's share of the proceeds received by the
subsidiary and the carrying amount of the portion of the Company's
investment sold is reflected as a gain or loss in the consolidated
statements of income.
F-8
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE A - THE COMPANY AND ITS SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
[13] STOCK-BASED COMPENSATION:
The provisions of Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation" ("SFAS No. 123") allow companies
to either expense the estimated fair value of employee stock options or to
follow the intrinsic value method set forth in APB Opinion 25, "Accounting
for Stock Issued to Employees" ("APB 25") but to disclose the pro forma
effects on net income had the fair value of the option been expensed. The
Company has elected to continue to apply APB 25 in accounting for its stock
option incentive plans.
[14] EARNINGS PER SHARE:
Basic earnings per share are computed using the weighted average number of
shares outstanding during each year. Diluted earnings per share are
computed using the weighted average number of shares outstanding during
each year, plus the incremental shares outstanding assuming the exercise of
dilutive stock options.
[15] RECENT ACCOUNTING PRONOUNCEMENTS:
The Financial Accounting Standards Board has issued a new standard.
Statement of Financial Accounting Standards No. 133 ("SFAS 133"),
accounting for Derivative Instruments and Hedging Activities, which becomes
effective for years beginning after June 15, 2000, requires that every
derivative instrument be recorded in the balance sheet as either an asset
or liability measured at its fair value. The statement requires that
changes in the derivative's fair value be recognized in earnings unless
specific hedge accounting criteria are met. The Company believes that the
effect of adoption of SFAS 133 will not be material to the Company's
financial statements.
NOTE B - MARKETABLE SECURITIES
Marketable securities represent equity securities classified as
available-for-sale. At December 31, 1999, such securities had a cost of $3,792
and a gross unrealized gain of $850 ($392 net of taxes of $341 and minority
interest of $117), respectively. During the year ended December 31, 2000 all
marketable securities were sold and a gain of $1,396 was realized. For the year
ended December 31, 1999, there were no sales of marketable securities and,
therefore, no gains or losses were realized.
NOTE C - INVENTORIES
DECEMBER 31,
-----------------
2000 1999
------- -------
Raw materials and component parts $ 8,775 $ 8,239
Finished goods 16,565 11,211
------- -------
$25,340 $19,450
======= =======
F-9
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE D - EQUIPMENT AND LEASEHOLD IMPROVEMENTS
DECEMBER 31,
---------------
2000 1999
------ ------
Equipment $7,998 $6,667
Leasehold improvements 382 383
------ ------
8,380 7,050
Less accumulated depreciation and amortization 5,218 3,924
------ ------
$3,162 $3,126
====== ======
NOTE E - TRADEMARKS AND LICENSES
DECEMBER 31,
---------------
2000 1999
------ ------
Trademarks $6,628 $7,013
Licenses 2,577 2,786
------ ------
9,205 9,799
Less accumulated amortization 4,666 3,955
------ ------
$4,539 $5,844
====== ======
NOTE F - LOANS PAYABLE - BANKS
Loans payable-bank represent borrowings by the Company's foreign
subsidiaries under several bank overdraft facilities bearing interest at
0.6% above the EURIBOR rate (4.9% and 3.3% at December 31, 2000 and 1999,
respectively). Outstanding amounts totaled $2,542 and $787 at December 31,
2000 and 1999, respectively.
NOTE G - LONG-TERM DEBT
As of December 31, 2000 and 1999, long-term debt represents borrowings by a
foreign subsidiary of $1,417 and $1,531, respectively, due in 2004. The debt
agreement requires interest payable monthly at 4.56%, however, the Company
entered into a Swap agreement with the bank effectively converting the interest
to a variable rate equal to the EURIBOR rate (4.9% at December 31, 2000).
F-10
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE H - COMMITMENTS
[1] LEASES:
The Company leases its office and warehouse facilities under operating
leases expiring through 2004. Rental expense amounted to $1,263 in 2000,
$1,159 in 1999 and $1,167 in 1998. Minimum future rental payments are as
follows:
2001 $ 1,254
2002 1,133
2003 739
2004 181
----------
$ 3,307
==========
[2] LICENSE AGREEMENTS:
The Company is obligated under a number of license agreements for the use
of trademarks and rights in connection with the manufacture and sale of
its products. In connection therewith, the Company is subject to certain
minimum annual royalties as follows:
2001 $ 1,991
2002 2,362
2003 2,843
2004 4,091
2005 4,366
Thereafter 13,454
----------
$ 29,107
==========
NOTE I - SHAREHOLDERS' EQUITY
[1] COMMON STOCK SPLIT:
On April 27, 2000, the Company's Board of Directors authorized a
three-for-two stock split effected in the form of a 50% stock dividend
distributed on June 15, 2000 to shareholders of record as of June 1, 2000.
As a result of the stock split, the accompanying consolidated financial
statements reflect an increase in the number of outstanding shares of
common stock and the transfer of the par value of these additional shares
from paid-in capital. All share and per share amounts have been restated to
reflect the retroactive effect of the stock split.
[2] ISSUANCE OF COMMON STOCK OF SUBSIDIARY:
During 1999, holders of the remaining $200 of convertible debt, originally
issued in 1994 by Inter Parfums, S.A., a subsidiary of the Company,
converted their investment into 18,309 shares of capital stock of Inter
Parfums, S.A. and employees exercising stock options were issued 34,041
shares of capital stock of Inter Parfums, S.A. As a result of such
issuances, the Company's percentage ownership of Inter Parfums, S.A.
decreased from approximately 79% to 78% as of December 31, 1999.
During 2000, an additional 5,918 shares of capital stock of Inter Parfums,
S.A. were issued as a result of employees exercising stock options. At
December 31, 2000, the Company's percentage ownership of Inter Parfums,
S.A. was approximately 78%.
F-11
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE I - SHAREHOLDERS' EQUITY (CONTINUED)
[2] ISSUANCE OF COMMON STOCK OF SUBSIDIARY: (CONTINUED)
The difference between the Company's share of the issuance or conversion
proceeds and the carrying amount of the portion of the Company's investment
sold is reflected as a gain or loss in the consolidated statements of
income. Deferred taxes have not been provided because application of
available tax savings strategies would eliminate taxes on this transaction.
[3] STOCK OPTION PLANS:
The Company maintains a stock option program for key employees, executives
and directors. The plans provide for the granting of both nonqualified and
incentive options. Options granted under the plans typically vest
immediately and are exercisable for a period of five to six years.
The Company applies APB 25 in accounting for its stock option incentive
plans and accordingly recognizes compensation expense for the difference
between the fair value of the underlying common stock and the grant price
of the option at the date of grant.
Pro forma information regarding net income and earnings per share is
required by SFAS No. 123. Had compensation cost for the Company's stock
option plans been determined based upon the fair value at the grant date,
consistent with the methodology prescribed under SFAS No. 123, the
Company's net income in 2000, 1999 and 1998 would have been approximately
$6.5, $4.2 and $4.3 million, or $0.50, $0.34 and $0.32 per diluted share,
respectively. The weighted average fair values of the options granted
during 2000, 1999 and 1998 are estimated as $1.93, $1.52 and $1.64 per
share, respectively, on the date of grant using the Black-Scholes option
pricing model with the following assumptions: dividend yield 0%, volatility
of 40%, risk-free interest rates at the date of grant, 5.88% in 2000, 5.18%
in 1999 and 5.40% in 1998, and an expected life of the option of two years.
A summary of the Company's stock option activity, and related information
follows:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------------------------------------
2000 1999 1998
---------------------- ---------------------- ----------------------
WEIGHTED WEIGHTED WEIGHTED
AVERAGE AVERAGE AVERAGE
EXERCISE EXERCISE EXERCISE
OPTIONS PRICE OPTIONS PRICE OPTIONS PRICE
--------- ----- --------- ----- --------- -----
<S> <C> <C> <C> <C> <C> <C>
Shares under option - beginning of year 2,651,325 $4.09 2,638,800 $4.37 2,513,700 $4.39
Options granted 113,875 7.12 1,099,500 3.85 562,575 4.53
Options exercised (187,125) 5.38 (956,550) 4.45 (11,250) 3.89
Options cancelled (11,125) 5.61 (130,425) 5.06 (426,225) 4.75
--------- --------- ---------
Shares under options - end of year 2,566,950 4.12 2,651,325 4.09 2,638,800 4.37
========= ========= =========
</TABLE>
Exercise prices for options outstanding as of December 31, 2000 ranged from
$3.79 to $8.69. The weighted average remaining contractual life of those
options is three and a half years.
At December 31, 2000 options for 627,336 shares were available for future
grant under the plans.
F-12
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE I - SHAREHOLDERS' EQUITY (CONTINUED)
[4] TREASURY STOCK:
The Board of Directors of the Company has authorized a stock repurchase
program whereby the Company purchases shares of its stock to be held in
treasury. As of December 31, 2000, the Company is authorized to purchase an
additional 474,600 treasury shares.
NOTE J - GEOGRAPHIC AREAS
Information on the Company's operations by geographical areas is as follows:
YEAR ENDED DECEMBER 31,
-----------------------------------
2000 1999 1998
--------- --------- ---------
Net sales:
United States $ 31,268 $ 26,826 $ 30,068
Europe 70,434 60,414 58,875
South America 811
Eliminations (120) (100) (366)
--------- --------- ---------
$ 101,582 $ 87,140 $ 89,388
========= ========= =========
Net income:
United States $ 1,977 $ 1,140 $ 1,503
Europe 4,616 3,788 3,609
South America (4) (100) (530)
Eliminations 31
--------- --------- ---------
$ 6,589 $ 4,828 $ 4,613
========= ========= =========
Depreciation and amortization expense:
United States $ 632 $ 595 $ 531
Europe 1,730 1,819 864
South America 1 6
--------- --------- ---------
$ 2,362 $ 2,415 $ 1,401
========= ========= =========
Interest income:
United States $ 647 $ 408 $ 376
Europe 418 279 409
South America 3
--------- --------- ---------
$ 1,065 $ 687 $ 788
========= ========= =========
F-13
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE J - GEOGRAPHIC AREAS (CONTINUED)
YEAR ENDED DECEMBER 31,
--------------------------------
2000 1999 1998
-------- -------- --------
Interest expense:
United States $ 38 $ 59 $ 50
Europe 325 274 377
South America 11 44
-------- -------- --------
$ 363 $ 344 $ 471
======== ======== ========
Total assets:
United States $ 39,455 $ 39,417 $ 41,330
Europe 64,455 57,677 55,893
South America 16 619
Eliminations (9,028) (9,887) (10,103)
-------- -------- --------
$ 94,882 $ 87,223 $ 87,739
======== ======== ========
Additions to long-lived assets:
United States $ 86 $ 101 $ 455
Europe 1,494 1,643 1,165
South America 11
-------- -------- --------
$ 1,580 $ 1,744 $ 1,631
======== ======== ========
Total long-lived assets:
United States $ 1,973 $ 2,519 $ 3,012
Europe 5,728 6,451 7,686
South America 1
-------- -------- --------
$ 7,701 $ 8,970 $ 10,699
======== ======== ========
United States export sales were approximately $11,000, $9,200 and $10,000 for
the years ended December 31, 2000, 1999 and 1998, respectively. Consolidated net
sales for the year ended December 31, 2000 by region is as follows:
North America 32%
Western Europe 30%
Central and South America 12%
Middle East 9%
Asia 9%
Eastern Europe 7%
Other 1%
F-14
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE K - INCOME TAXES
The components of income before income taxes consist of the following:
YEAR ENDED DECEMBER 31,
---------------------------------
2000 1999 1998
------- ------- -------
U.S. operations $ 3,096 $ 1,750 $ 2,304
Foreign operations 10,443 8,118 6,806
Eliminations 54
------- ------- -------
$13,539 $ 9,868 $ 9,164
======= ======= =======
The provision for current and deferred income tax expense (benefit) consists of
the following:
YEAR ENDED DECEMBER 31,
---------------------------------
2000 1999 1998
------- ------- -------
Current:
Federal $ 796 $ 311 $ 344
State and local 170 142 105
Foreign 4,189 3,963 2,984
------- ------- -------
5,155 4,416 3,433
------- ------- -------
Deferred:
Federal 172 142 283
State and local (19) 16 70
Foreign 323 (596) (188)
------- ------- -------
476 (438) 165
------- ------- -------
Total income tax expense $ 5,631 $ 3,978 $ 3,598
======= ======= =======
Deferred taxes are provided principally for reserves, and certain other expenses
that are recognized in different years for financial reporting and income tax
purposes. At December 31, 2000, the deferred tax assets consist of approximately
$564 relating to accounts receivable and inventory writedowns which are not
currently deductible for tax purposes, foreign net operating loss carryforwards
and the difference between the book basis and tax basis of fixed assets. At
December 31, 2000, the deferred tax liability of $684 relates primarily to the
difference between the book basis and tax basis of intangible assets and certain
foreign production equipment.
The Company has provided a valuation allowance of $129, representing the full
amount of the deferred tax assets arising from foreign net operating loss
carryforwards. No allowance has been provided on the balance of the Company's
deferred tax assets, as management believes that it is more likely than not that
the asset will be realized in reduction of future taxable income.
F-15
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE K - INCOME TAXES (CONTINUED)
Differences between the United States federal statutory income tax rate and the
effective income tax rate were as follows:
YEAR ENDED DECEMBER 31,
-----------------------
2000 1999 1998
----- ----- -----
Statutory rates 34.0% 34.0% 34.0%
State and local taxes, net of federal benefit 0.7 1.1 1.3
Effect of foreign taxes in excess of U.S.
statutory rates 6.9 5.2 4.0
----- ----- -----
Effective rates 41.6% 40.3% 39.3%
===== ===== =====
NOTE L - OTHER MATTERS
[1] As previously reported, Inter Parfums, S.A., the Company's majority owned
French subsidiary, is a party to litigation with Jean Charles Brosseau,
S.A. ("Brosseau"), the licensor of the Ombre Rose trademark. The licensor
has claimed damages of approximately $7,000 and is seeking termination of
the license agreement.
In October 1999, Inter Parfums S.A. received notice of a judgment in favor
of Brosseau, which awarded damages of approximately $600 to Brosseau, and
which directed Inter Parfums, S.A. to turn over its license to Brosseau
within six months.
Inter Parfums, S.A. is appealing the judgment as it vigorously and
categorically denies the claims of Brosseau. The payment of the judgment
has been stayed, and Inter Parfums, S.A. was allowed to operate under the
license agreement during the appeal process.
In June 2000, the president of the Court of Appeal granted a petition filed
by Brosseau regarding ongoing payments for royalties due to Brousseau. In
the same interlocutory judgment, the president of the Court of Appeal
rejected Inter Parfums, S.A.'s request for the appointment of a new
judicial expert. Such request was made to refute the findings of the
judicial expert originally appointed by the Commercial Court, which
resulted in the $600 judgment against Inter Parfums, S.A. As a result
of these further developments, Inter Parfums, S.A. and its special
litigation counsel consider it likely that the judgment will be sustained
and therefore, in June 2000, has taken a charge against earnings for $600,
the full amount of the judgment.
In February 2001, the Court of Appeal confirmed the Brosseau claim with
respect to turning over the license. In addition, the Court named an expert
to proceed with additional investigations and required Inter Parfums, S.A.
to pay $142 as an advance for damages claimed by Brosseau.
Inter Parfums, S.A. is continuing its appeal as it still denies the claims
of Brosseau. Management does not believe that such litigation will have any
further material adverse effect on the financial condition or operations of
the Company. As of December 31, 2000 the Company has fully reserved the
unamortized portion of the license agreement.
F-16
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
NOTE L - OTHER MATTERS (CONTINUED)
[2] Inter Parfums, S.A. is the subject of tax audits commenced by the French
Tax Authorities. Assessments have been issued aggregating $2,300. Inter
Parfums, S.A. is contesting these assessments. Management and its tax
consultants believe they have sound arguments to support their position and
that the majority of these assessments will be reversed, and therefore,
will not have a material adverse effect on the financial condition or
operations of the Company. The Company has reserves of approximately $760,
which it presently believes will be its ultimate exposure.
[3] On November 22, 1999, the Chief Executive Officer and the President of the
Company entered into and closed a Stock Purchase Agreement with LV Capital,
USA Inc. ("LV Capital"), a wholly-owned subsidiary of LVMH Moet Hennessy
Louis Vuitton, S.A. ("LVMH"). In accordance with the terms of the Stock
Purchase Agreement, LV Capital purchased an aggregate of 1,273,800 shares
of Common Stock of the Company at $8.00 per share, as follows: 390,000
shares (inclusive of 75,000 shares acquired upon exercise of an outstanding
stock option) from each of the Chief Executive Officer and the President of
the Company, and an aggregate of 493,800 shares (inclusive of 318,300
shares issued upon exercise of outstanding stock options) from management
and employees. As the result of such transaction, the Company received
proceeds of approximately $4,200 as the result of the exercise of the
outstanding stock options.
In addition, in return for LV Capital becoming a strategic partner of the
Company, LV Capital is to be granted the right to maintain its percentage
ownership of the outstanding shares of Common Stock, by receiving an option
to purchase shares of the Company's common stock for cash upon issuance of
shares to any party other than LV Capital at the price paid by the
purchaser, subject to certain exceptions such as the exercise of stock
options previously granted and the grant of new stock options up to a
certain limit. LVMH was also granted demand registration rights for all
shares of common stock it holds. Finally, LV Capital has agreed to a
standstill agreement, which includes a limitation on the amount of shares
that LV Capital can hold equal to 25% of the outstanding shares of common
stock of the Company.
In March 1999 and May 2000, the Company entered into two Eleven Year
License Agreements with Christian Lacroix Company and Celine S.A.,
divisions of LVMH, respectively. Both agreements have minimum sales and
advertising requirements and require the Company to pay royalties as are
customary in the industry.
F-17
<PAGE>
INTER PARFUMS, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
(in thousands except share and per share data)
SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
(in thousands)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
- ------------------------------------------------------------------------------------------------------------------------------------
ADDITIONS
-----------------------------
BALANCE (1) (2)
-----------------------------
AT CHARGED TO BALANCE
BEGINNING CHARGED TO OTHER AT
OF COSTS AND ACCOUNTS - DEDUCTIONS - END OF
DESCRIPTION PERIOD EXPENSES DESCRIBE DESCRIBE PERIOD
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Year ended December 31, 2000:
Allowances for sales returns and doubtful accounts $ 2,095 $669 $(119) (b) $ 578 (a) $ 2,067
======= ==== ========== ======= =======
Year ended December 31, 1999:
Allowances for sales returns and doubtful accounts $ 2,432 $988 $(243) (b) $ 1,082 (a) $ 2,095
======= ==== ===== ======= =======
Year ended December 31, 1998:
Allowances for sales returns and doubtful accounts $ 2,995 $1,597 $ 2,160 (a) $ 2,432
======= ====== ======= =======
</TABLE>
(a) Write off of bad debts and sales returns.
(b) Foreign currency translation adjustment.
SEE NOTES TO FINANCIAL STATEMENTS
F-19
<PAGE>
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.
Inter Parfums, Inc.
By: /s/ Jean Madar
---------------
Jean Madar, Chief Executive Officer
Date: 23 March 2001
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:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Chairman of the Board of Directors 23 March 2001
/s/ Jean Madar and Chief Executive Officer
- -------------------------
Jean Madar
- --------------------------------------------------------------------------------------------------------------------
Chief Financial and Accounting 23 March 2001
/s/ Russell Greenberg Officer and Director
- -------------------------
Russell Greenberg
- --------------------------------------------------------------------------------------------------------------------
/s/ Philippe Benacin Director 27 March 2001
- -------------------------
Philippe Benacin
- --------------------------------------------------------------------------------------------------------------------
Director 21 March 2001
/s/ Francois Heilbronn
- -------------------------
Francois Heilbronn
- --------------------------------------------------------------------------------------------------------------------
Director 26 March 2001
/s/ Joseph A. Caccamo
- -------------------------
Joseph A. Caccamo
- --------------------------------------------------------------------------------------------------------------------
Director 21 March 2001
/s/ Jean Levy
- -------------------------
Jean Levy
- --------------------------------------------------------------------------------------------------------------------
Director 21 March 2001
/s/ Robert Bensoussan-Torres
- -------------------------
Robert Bensoussan-Torres
- --------------------------------------------------------------------------------------------------------------------
/s/ Daniel Piette Director 27 March 2001
- ------------------------
Daniel Piette
- --------------------------------------------------------------------------------------------------------------------
/s/ Jean Cailliau Director 27 March 2001
- ------------------------
Jean Cailliau
- --------------------------------------------------------------------------------------------------------------------
/s/ Philippe Santi Director 27 March 2001
- ----------------------
Philippe Santi
- --------------------------------------------------------------------------------------------------------------------
Director __ March 2001
- ----------------------
Serge Rosinoer
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBIT INDEX TO
REPORT ON FORM 10-K
(Mark one)
/X/ Annual Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the fiscal year ended 31 December 2000 or
// Transition Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from to .
--------------
Commission File No. 0-16469
INTER PARFUMS, INC.
(Exact name of registrant as specified in its charter)
<PAGE>
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - January 18, 1990), as follows:
EXHIBIT NO. AND DESCRIPTION
10.13 License Agreement between the Company and Jordache dated January 18, 1990
(as no. 10.1 therein).
10.15 Letter of Indemnification from Jordache to the Company dated January 18,
1990 (as no. 10.3 therein)
10.16 Letter Agreement from Jordache to the Company regarding foreign license
rights dated January 18, 1990 (as no. 10.4 therein).
The following document heretofore filed with the Commission is
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - July 29, 1991), as follows:
EXHIBIT NO. AND DESCRIPTION
10.24 Agreement and Plan of Reorganization dated July 29, 1991 among the
Company, Jean Madar and Philippe Benacin (as No. 10.1 therein)
The following document heretofore filed with the Commission is
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1991:
Exhibit No. and Description
10.25 Employment Agreement between the Company and Philippe Benacin dated July
29, 1991
The following documents heretofore filed with the Commission is
incorporated by reference to the Company's Registration Statement on Form S-1
(No. 33-48811):
EXHIBIT NO. AND DESCRIPTION
10.26 Lease for portion of 15th Floor, 551 Fifth Avenue, New York, New York
2
<PAGE>
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1992:
EXHIBIT NO. AND DESCRIPTION
4.10 Amendment to 1992 Stock Option Plan
4.11 1993 Stock Option Plan
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - July 15, 1993), as follows:
Exhibit No. and Description
10.30 License Agreement dated July 15, 1993, among Burberrys Limited, Inter
Parfums, S.A. and Jean Philippe Fragrances, Inc.(1)
10.31 License Agreement dated May 7, 1993, between Jean-Charles Brosseau, S.A.
and Inter Parfums, S.A. (original in French)(1)
10.32 License Agreement dated May 7, 1993, between Jean-Charles Brosseau, S.A.
and Inter Parfums, S.A.(translation of French into English)(1)
10.33 Agreement dated July 14, 1993, between Alfin, Inc. and Inter Parfums,
S.A.1
10.34 Agreement dated July 16, 1993 among Inter Parfums, S.A., Jean Philippe
Fragrances, Inc., C&C Beauty Sales, Inc. and Parfico, Inc.
10.35 Distribution Agreement dated July 16, 1993 among Inter Parfums, S.A., Jean
Philippe Fragrances, Inc. and Fragrance Marketing Group, Inc.(1)
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Current Report on Form 8-K
(date of event - February 28, 1994), as follows:
EXHIBIT NO. AND DESCRIPTION
10.36 Cession D'Elements Partiels de Fonds de Commerce between Inter Parfums,
S.A. and
- -----------------
(1) Filed in excised form.
3
<PAGE>
Cosmetiques et Parfums de France-I.D., S.A. dated February 18, 1994
(re: Parfums Molyneux)
10.37 Cession D'Elements Partiels de Fonds de Commerce between Inter Parfums,
S.A. and Cosmetiques et Parfums de France-I.D., S.A. dated February 18, 1994
(re: Parfums Weil)
10.38 Agreement (Acquisition) among Jean Philippe Fragrances, Inc., Inter
Parfums, S.A. and Cosmetiques et Parfums de France, S.A. dated February 18, 1994
10.39 Noncompetition Agreement among Jean Philippe Fragrances, Inc., Inter
Parfums, S.A. and Cosmetiques et Parfums de France-I.D., S.A. dated February 18,
1994
10.40 Commission Agreement among Jean Philippe Fragrances, Inc., Inter Parfums,
S.A. and Sodipe S.A. dated February 18, 1994
10.41 Convention between Inter Parfums, S.A. and Cosmetiques et Parfums de
France-I.D., S.A. dated February 18, 1994 (re inventory purchase)
10.42 Convention de Nantissement among Cosmetiques et Parfums de France, S.A.,
Cosmetiques et Parfums de France-I.D., S.A., Sodipe S.A., Jean Philippe
Fragrances, Inc. and Inter Parfums, S.A. dated February 18, 1994 (re security
agreement)
10.43 Convention among Cosmetiques et Parfums de France-I.D., S.A., Cosmetiques
et Parfums de France, S.A., Jean Philippe Fragrances, Inc. and Inter Parfums,
S.A. and Sodipe S.A. dated February 18, 1994 (re French regulatory requirements)
10.44 Acquisition Agreement among Jean Philippe Fragrances, Inc., Revlon
Consumer Products Corporation and Revlon Suisse, S.A. dated March 2, 1994
The following documents heretofore filed with the Commission are
incorporated herein by reference to the Company's Form 8 Amendment no. 1 (dated
March 14, 1994) to the Current Report on Form 8-K (date of event - February 28,
1994), as follows:
EXHIBIT NO. AND DESCRIPTION
10.46. English translation of exhibit no. 10.36, Cession D'Elements Partiels de
Fonds de Commerce between Inter Parfums, S.A. and Cosmetiques et Parfums de
France-I.D., S.A. dated February 18, 1994 (re: Parfums Molyneux)
10.47. English translation of exhibit no. 10.37, Cession D'Elements Partiels de
Fonds de Commerce between Inter Parfums, S.A. and Cosmetiques et Parfums de
France-I.D., S.A. dated February 18, 1994 (re: Parfums Weil)
10.48. English translation of exhibit no. 10.41, Convention between Inter
Parfums, S.A. and
4
<PAGE>
Cosmetiques et Parfums de France-I.D., S.A. dated February 18, 1994 (re
inventory purchase)
10.49. English translation of exhibit no. 10.42, Convention de Nantissement
among Cosmetiques et Parfums de France, S.A., Cosmetiques et Parfums de
France-I.D., S.A., Sodipe S.A., Jean Philippe Fragrances, Inc. and Inter
Parfums, S.A. dated February 18, 1994 (re security agreement)
The following document heretofore filed with the Commission is
incorporated herein by reference to the Company's Form 8 Amendment no. 2 (dated
March 21, 1994) to the Current Report on Form 8-K (date of event - February 28,
1994), as follows:
EXHIBIT NO. AND DESCRIPTION
10.50. English translation of exhibit no. 10.43, Convention among Cosmetiques et
Parfums de France-I.D., S.A., Cosmetiques et Parfums de France, S.A., Jean
Philippe Fragrances, Inc. and Inter Parfums, S.A. and Sodipe S.A. dated February
18, 1994 (re French regulatory requirements)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993:
EXHIBIT NO. AND DESCRIPTION
3.3 Articles of Incorporation of Inter Parfums Holding, S.A.
3.3.1 English Translation of Exhibit no. 3.3, Articles of Incorporation of Inter
Parfums Holding, S.A.
3.4 Articles of Incorporation of Inter Parfums, S.A.
3.4.1 English Translation of Exhibit no. 3.4, Articles of Incorporation of Inter
Parfums, S.A.
4.15 1994 Nonemployee Director Stock Option Plan
10.51 Traite D'Apport Partiel D'Actif dated July 30, 1993 (Reorganization
Agreement between Inter Parfums, S.A. and Selective Industrie, S.A.)
10.51.1 English translation of Exhibit no. 10.51, Traite D'Apport Partiel
D'Actif dated July 30, 1993 (Reorganization Agreement between Inter Parfums,
S.A. and Selective Industrie, S.A.)
10.52 Lease for portion of 4, Rond Point Des Champs Des Elysees dated September
30, 1993
5
<PAGE>
10.52.1 English translation of Exhibit no. 10.52, Lease for portion of 4, Rond
Point Des Champs Des Elysees dated September 30, 1993
10.53 Lease for portion of 4, Rond Point Des Champs Des Elysees dated March 2,
1994
10.53.1 English translation of Exhibit no. 10.53, Lease for portion of 4, Rond
Point Des Champs Des Elysees dated March 2, 1994
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1994:
4.16 1994 Nonemployee Director Supplemental Stock Option Plan (Listed as no.
4.15 therein)
10.59 Modification of Lease Agreement dated June 17, 1994 between Metropolitan
Life Insurance Company and Jean Philippe Fragrances, Inc.
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995:
EXHIBIT NO. AND DESCRIPTION
10.61 Lease for 60 Stults Road, South Brunswick, NJ between Forsgate Industrial
Complex, a limited partnership, and Jean Philippe Fragrances, Inc. dated July
10, 1995
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996:
EXHIBIT NO. AND DESCRIPTION
10.65 Asset Repurchase Agreement between Carson, Inc. and Jean Philippe
Fragrances, Inc. dated March 27, 1997
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997:
6
<PAGE>
EXHIBIT NO. AND DESCRIPTION
10.67 Second Modification of Lease made as of the 30th day of April, 1997
between Metropolitan Life Insurance Company as landlord and Jean Philippe
Fragrances, Inc. as tenant.
10.68 Amendment I to License Agreement dated September 3, 1997 between Jordache
Enterprises, Inc. as Licensor and Jean Philippe Fragrances, Inc. as Licensee.
10.69 Exclusive Licence Agreement dated June 20, 1997 between S.T. Dupont, S.A.
and Inter Parfums (English translation, excised version)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1998:
EXHIBIT NO. AND DESCRIPTION
3.2 Amended and Restated By-laws
4.17 1997 Nonemployee Director Stock Option Plan
4.18 1999 Stock Option Plan
10.70 Licence Agreement among Paul Smith Limited, Inter Parfums, S.A. and
Jean-Philippe Fragrances, Inc. (excised version)
10.71 Licence Agreement between Christian LaCroix, a division of Group LVMH and
Inter Parfums, S.A (English translation, excised version)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's current report on Form 8-K (date of
event - November 22, 1999):
Exhibit No. and Description
4.2 Shareholder's Agreement among LV Capital USA, Inc., Jean Mader and Philippe
Benacin dated November 22, 1999.
99.1 Stock Purchase Agreement among LV Capital USA, Inc., Jean Madar and
Philippe Benacin dated November 22, 1999.
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1999:
7
<PAGE>
EXHIBIT NO. AND DESCRIPTION
3.1.4 Amendment to the Company's Restated Certificate of Incorporation, as
amended, dated July 13, 1999 (listed therein as 3.1(d))
10.73 Burberry Confidential Treatment Agreement dated 8 February, 2000
10.74 Burberry Licence Amendment dated February, 2000 (filed in excised form)
The following documents heretofore filed with the Commission are
incorporated by reference to the Company's current report on Form 8-K/A no. 1
(date of event - 18 May 2000):
10.76 Celine License Agreement [in French]- excised.
10.76.1 Celine License Agreement [English translation]- excised.
The following document heretofore filed with the Commission is
incorporated by reference to the Company's current report on Form 8-K/A no. 1
(date of event - 23 June 2000):
10.77 Sublicense Agreement for FUBU Fragrances, dated June 22, 2000 -
excised.
The following document heretofore filed with the Commission is
incorporated by reference to the Company's quarterly report on Form 10-Q for the
period ending 30 June 2000:
3.1.5 Amendment to the Company's Restated Certificate of Incorporation, as
amended, dated 12 July 2000 (listed therein as 3.1(e))
8
<PAGE>
The following documents are filed herewith:
Exhibit No. and Description
3.1.1 Restated Certificate of Incorporation dated September 3, 1987
3.1.2 Amendment to the Company's Restated Certificate of Incorporation dated
July 31, 1992
3.1.3 Amendment to the Company's Restated Certificate of Incorporation dated
July 9, 1993
4.19 2000 Nonemployee Director Stock Option Plan
10.78 Revolving Credit Agreement dated June 1, 2000 between HSBC Bank USA and
Inter Parfums, Inc.
10.79 Bail [Lease] for 18 avenue Franklin Roosevelt, Paris France [French
Original]
10.79.1 Bail [Lease] for 18 avenue Franklin Roosevelt, Paris France [English
Translation]
10.80 Credit Lyonnais Letter Agreement dated 22 March 2001 - [French Original]
10.80.1 Credit Lyonnais Letter Agreement dated 22 March 2001 - [English
Translation]
10.81 Barclays Bank Letter Agreement dated 4 June 1998 - [French Original]
10.81.1 Barclays Bank Letter Agreement dated 4 June 1998 - [English Translation]
10.82 Banque OBC Odier Bungener Courvoisier Letter Agreement one dated 31 July
1998 - [French Original]
10.82.1 Banque OBC Odier Bungener Courvoisier Letter Agreement one dated 31 July
1998 - [English Translation]
10.83 Banque OBC Odier Bungener Courvoisier Letter Agreement two dated 31 July
1998 - [French Original]
10.83.1 Banque OBC Odier Bungener Courvoisier Letter Agreement two dated 31 July
1998 - [English Translation]
10.84 Banque Worms Letter Agreement dated 22 December 1997 - [French Original]
10.84.1 Banque Worms Letter Agreement dated 22 December 1997 - [English
Translation]
10.85 Credit Agricole D'Lile de France Letter Agreement dated 19 June 1996 -
[French Original]
10.85.1 Credit Agricole D'Lile de France Letter Agreement dated 19 June 1996 -
[English Translation]
21 List of Subsidiaries
9
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.1.1
<SEQUENCE>2
<FILENAME>c20397_ex419.txt
<DESCRIPTION>RESTATED CERTIFICATE OF INCORPORATION
<TEXT>
Exhibit 3.1.1
RESTATED CERTIFICATE OF INCORPORATION
-of-
JEAN PHILIPPE FRAGRANCES, INC.
-----------------------------
Pursuant to the
General Corporation Law
of the State of Delaware
------------------------------
Jean Philippe Fragrances, Inc. (the "Corporation") hereby certifies
that:
A. The name of the Corporation is Jean Philippe Fragrances, Inc., and
its original Certificate of Incorporation was filed with the Secretary of State
of the State of Delaware on May 6, 1985.
B. The Certificate of Incorporation of the Corporation is hereby
amended by striking out Articles Second, Third, Fourth and Sixth thereof and by
substituting in lieu of said Articles new Articles Second, Third, Fourth and
Sixth and by adding the following new Articles Seventh and Eighth, which are set
forth in the Restated Certificate of Incorporation hereinafter provided for.
C. The amendments and the restatement of the Certificate of
Incorporation set forth herein were duly adopted in accordance with the
provisions of Sections 242 and 245 of the General Corporation Law of the State
of Delaware by a resolution of the Board of Directors setting forth the
amendments and the restatement and declaring their advisability, and by written
consents, given pursuant to Section 228 of the General Corporation Law of the
State of Delaware, by the holders of all outstanding stock entitled to vote.
D. The Certificate of Incorporation of the Corporation as now in full
force and effect is hereby amended and restated to read in full as follows:
FIRST: The name of the Corporation is Jean Philippe Fragrances, Inc.
SECOND: The registered office of the Corporation and place of business
in the State of Delaware is to be located at 229 South State Street, in the City
of Dover, County of Kent. The name of its registered agent at that address is
The Prentice-Hall Corporation System, Inc.
<PAGE>
THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware as presently in effect or as it may hereafter be
amended.
FOURTH: The Corporation shall have the authority to issue the following
classes of shares in the following amounts with the respective powers,
preferences, rights, qualifications, limitations and restrictions set forth
below:
The Corporation shall have the authority to issue twenty
million (20,000,000) shares of Common Stock, $.001 par value per share,
each of which shall be equal in all respects to every other share of
Common Stock.
FIFTH: In furtherance and not in limitation of the powers conferred by
the laws of the State of Delaware, the following provisions are inserted in this
Restated Certificate of Incorporation for the regulation and conduct of the
business and affairs of the Corporation:
1. The election of directors of the Corporation need not be by written
ballot unless the By-Laws so require.
2. The business and affairs of the Corporation shall be managed by, or
under the direction of, a Board of Directors consisting of not less than three
(3) nor more than fifteen (15) persons. The exact number of directors within the
minimum and maximum limitations specified herein shall be fixed from time to
time by resolution of a majority of the whole Board of Directors.
3. The directors of the Corporation, by the affirmative vote of a
majority of the whole Board, at any regular or special meeting, shall have the
power to adopt, amend or repeal By-Laws of the Corporation, provided, however,
that such power of the Board shall not divest the stockholders of the
Corporation of their power to adopt, amend or repeal By-Laws of the Corporation.
4. In addition to the powers and authorities conferred upon the Board
of Directors of the Corporation by this Restated Certificate of Incorporation,
the Board of Directors of the Corporation may exercise all such powers and take
all such actions as may be exercised or taken by the Corporation, subject,
however, to the provisions of the laws of the State of Delaware, this Restated
Certificate of Incorporation and the By-Laws of the Corporation.
<PAGE>
5. Any vote or votes authorizing liquidation of the Corporation or
proceedings for its dissolution may provide, subject to the rights of creditors
and preferred Stockholders, if any, for the distribution pro rata among the
Stockholders of the Corporation of the assets of the Corporation, wholly or in
part, in cash or in kind, whether such assets be in cash or other property, and
any such vote or votes may authorize the Board of Directors of the Corporation
to determine the valuation of the different assets of the Corporation for the
purpose of such liquidation and may divide or authorize the Board of Directors
to divide such assets or any part thereof among the Stockholders of the
Corporation, in such manner that every Stockholder will receive a proportionate
amount in value (determined as aforesaid) of cash and/or property of the
Corporation upon such liquidation or dissolution even though each Stockholder
may not receive a strictly proportionate part of each such asset.
6. A director may not be removed from office without cause, except by
the holders of a majority of the outstanding shares of the class that elected
such director.
SIXTH: No director shall be personally liable to the Corporation or any
stockholder for monetary damages for breach of fiduciary duty as a director,
except in respect of which such director shall be liable under Section 174 of
Title 8 of the Delaware Code (relating to the Delaware General Corporation Law)
or any amendment thereto or successor provision thereto or shall be liable by
reason that, in addition to any and all other requirements for such liability,
he (i) shall have breached his duty of loyalty to the Corporation or its
stockholders, (ii) shall not have acted in good faith or, in failing to act,
shall not have acted in good faith, (iii) shall have acted in a manner involving
misconduct or a knowing violation of law or, in failing to act, shall have acted
in a manner involving intentional misconduct or a knowing violation of law or
(iv) shall have derived an improper benefit. Neither the amendment nor repeal of
this Article Sixth, nor any existing or subsequently adopted provisions of the
Certificate of Incorporation inconsistent with this Article Sixth, shall
eliminate or reduce the effect of this Article Sixth in respect of any matter
occurring, or any cause of action, suit or claim that, but for this Article
Sixth would accrue or arise, prior to such amendment, repeal or adoption of an
inconsistent provision. Any and all future amendments to the General Corporation
Law of the State of Delaware, or any successor statute thereto, which broadens
the scope of limited liability for directors, shall automatically be deemed to
become incorporated into an amendment to this Restated Certificate of
Incorporation without any action on
<PAGE>
the part of the stockholders, but shall be effective as if duly authorized by
the stockholders of the Corporation.
SEVENTH: The Corporation shall, to the fullest extent permitted by
Section 145 of the General Corporation Law of the State of Delaware, as the same
may be amended and supplemented, indemnify any and all persons whom it shall
have power to indemnify under said section from and against any and all of the
expenses, liabilities, or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any By-Law, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office, and shall continue as to a person
who has ceased to be a director, officer, employee, or agent and shall inure to
the benefit of the heirs, executors, and administrators of such a person.
EIGHTH: If any Article of this Certificate of Incorporation or any
portion thereof is found to be void or unenforceable by a court of competent
jurisdiction, the remaining Articles or portions of said Article, as the case
may be, shall nevertheless remain in full force and effect as though the
unenforceable part had been severed and deleted.
IN WITNESS WHEREOF, Jean Philippe Fragrances, Inc. has caused this
Restated Certificate of Incorporation to be executed by Jean Madar, its
President, and attested by its Assistant Secretary, this 3rd day of September,
1987.
JEAN PHILIPPE FRAGRANCES, INC.
By:/s/ Jean Madar
----------------------------
Jean Madar, President
Attest:
/s/ Felice Kadanoff
- ---------------------------------
Felice Kadanoff, Assist Secretary
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.1.2
<SEQUENCE>3
<FILENAME>c20397_ex313.txt
<DESCRIPTION>RESTATED CERTIFICATE
<TEXT>
Exhibit 3.1.2
CERTIFICATE OF AMENDMENT
to the
RESTATED CERTIFICATE OF INCORPORATION
of
JEAN PHILIPPE FRAGRANCES, INC.
PURSUANT TO THE DELAWARE GENERAL CORPORATION LAW
Jean Philippe Fragrances, Inc. hereby certifies that:
A. The name of the Corporation is Jean Philippe Fragrances, Inc. (the
"Corporation"), and its original Certificate of Incorporation was filed with the
Secretary of State of Delaware on May 6, 1985.
B. The Restated Certificate of Incorporation is hereby amended to
increase the number of actual shares from twenty million (20,000,000) to
twenty-one million (21,000,000), by striking out Article FOURTH in its entirety,
and substituting in lieu thereof the new Article FOURTH as follows:
"FOURTH: The aggregate number of shares which the Corporation
shall have authority to issue is twenty-one million (21,000,000) shares
consisting of twenty million (20,000,000) shares, designated as Common Stock, at
par value of $.001 per share, and one million (1,000,000) shares, designated as
Preferred Stock, at a par value of $.001 per share.
(1) COMMON STOCK.
(a) DIVIDENDS. The holders of shares of Common Stock shall be
entitled to receive, when and as declared by the Board of Directors, out of the
assets of the Corporation legally available therefor, such dividends as may be
declared from time to time by the Board of Directors.
(b) LIQUIDATION. Subject to the rights of any other
1
<PAGE>
class or series of stock, the holders of shares of Common Stock shall be
entitled to receive all the assets of the Corporation available for distribution
to shareholders in the event of the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, ratably, in proportion to the
number of shares of Common Stock held by them. Neither the merger or
consolidation of the Corporation into or with any other corporation, nor the
merger or consolidation of any other corporation into or with the Corporation,
nor the sale, lease, exchange or other disposition (for cash, shares of stock,
securities or other consideration) of all or substantially all the assets of the
Corporation shall be deemed to be a dissolution, liquidation or winding up,
voluntary or involuntary, of the Corporation.
(c) REDEMPTION. Common Stock shall not be subject to redemption.
(d) Voting. Subject to the rights of any other class or series of
stock and the provisions of the laws of the State of Delaware governing business
corporations, voting rights shall be vested exclusively in the holders of Common
Stock. Each holder of Common Stock shall have one vote in respect of each share
of such stock held.
(2) PREFERRED STOCK.
The Preferred Stock may be issued, from time to time, in one or more
series, with such designations, preferences and relative, participating,
optional or other rights, qualifications, limitations or restrictions thereof as
shall be stated and expressed in the resolution or resolutions providing for the
issue of such series which shall be adopted by the Board of Directors from time
to time, pursuant to the authority herein given, a copy of which resolution or
resolutions shall have been set forth in a Certificate made, executed,
acknowledged, filed and recorded in the manner required by the laws of the State
of Delaware in order to make the same effective. Each series shall consist of
such number of shares as shall be stated and expressed in such resolution or
resolutions providing for the issuance of the stock of such series. All shares
of any one series of Preferred Stock shall be alike in every particular. The
authority of the Board of Directors with respect to each series shall include,
but not be limited to, determination of the following:
(a) the number of shares constituting that series and the
distinctive designation of that series;
(b) whether the holders of shares of that series
2
<PAGE>
shall be entitled to receive dividends and, if so, the rates of such dividends,
conditions under which and times such dividends may be declared or paid, any
preference of any such dividends to, and the relation to, the dividends payable
on any other class or classes of stock or any other series of the same class and
whether dividends shall be cumulative or noncumulative and, if cumulative, from
which date or dates;
(c) whether the holders of shares of that series shall have voting
rights in addition to the voting rights provided by law and, if so, the terms of
such voting rights;
(d) whether shares of that series shall have conversion or exchange
privileges into or for, at the option of either the holder or the Corporation or
upon the happening of a specified event, shares of any other class or classes or
of any other series of the same or other class or classes of stock of the
Corporation and, if so, the terms and conditions of such conversion or exchange,
including provision for adjustment of the conversion or exchange rate in such
events as the Board of Directors shall determine;
(e) whether shares of that series shall be redeemable and, if so, the
terms and conditions of such redemption, including the date or dates upon or
after which they shall be redeemable and the amount per share payable in case of
redemption, which amount may vary under different conditions and at different
redemption dates;
(f) whether shares of that series shall be subject to the operation of
a retirement or sinking fund and, if so subject, the extent to and the manner in
which it shall be applied to the purchase or redemption of the shares of that
series, and the terms and provisions relative to the operation thereof;
(g) the rights of shares of that series in the event of voluntary or
involuntary liquidation, dissolution or winding up of the Corporation and any
preference of any such rights to, and the relation to, the rights in respect
thereto of any class or classes of stock or any other series of the same class;
and
(h) whether shares of that series shall be subject or entitled to any
other preferences, and the other relative, participating, optional or other
special rights and qualifications, limitations or restrictions of shares of that
series and, if so, the terms thereof."
C. The foregoing Amendment to the Restated Certificate of Incorporation
of the Corporation was authorized pursuant to Section
3
<PAGE>
141(b) of the Delaware Corporation Law by the affirmative vote of a majority of
the Board of Directors of the Corporation present at a meeting at which a quorum
was present followed by the affirmative vote of a majority of all of the
outstanding shares Common Stock of the Corporation entitled to vote on the said
Amendment to the Restated Certificate of Incorporation at a meeting at which a
quorum was present pursuant to Section 242 of the Delaware General Corporation
Law.
D. This Certificate of Amendment to the Restated Certificate of
Incorporation shall be effective upon the filing of same with the Secretary of
State of Delaware.
4
<PAGE>
IN WITNESS WHEREOF, we have subscribed this document on the date set
forth below and do hereby affirm, under the penalties of perjury, that the
statements contained therein have been examined by us and are true and correct.
Dated: July 31, 1992
/s/ Jean Madar
---------------------
Jean Madar, President
/s/ Neil Fogel
---------------------
Neil Fogel, Assistant Secretary
5
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.1.3
<SEQUENCE>4
<FILENAME>c20397_ex312.txt
<DESCRIPTION>CERTIFICATE OF AMENDMENT
<TEXT>
Exhibit 3.1.3
CERTIFICATE OF AMENDMENT
to the
RESTATED CERTIFICATE OF INCORPORATION
of
JEAN PHILIPPE FRAGRANCES, INC.
pursuant to the
DELAWARE GENERAL CORPORATION LAW
Jean Philippe Fragrances, Inc. hereby certifies that:
A. The name of the Corporation is Jean Philippe Fragrances, Inc. (the
"Corporation"), and its original Certificate of Incorporation was filed with the
Secretary of State of Delaware on May 6, 1985.
B. The Restated Certificate of Incorporation is hereby amended to
increase the number of actual shares from twenty-one million (21,000,000) to
thirty-one million (31,000,000), by striking out the first full paragraph of
Article FOURTH in its entirety, and substituting in lieu thereof the new first
full paragraph of Article FOURTH as follows:
"FOURTH: The aggregate number of shares which the Corporation
shall have authority to issue is thirty-one million (31,000,000) shares
consisting of thirty million (30,000,000) shares, designated as Common Stock, at
par value of $.001 per share, and one million (1,000,000) shares, designated as
Preferred Stock, at a par value of $.001 per share."
C. The foregoing Amendment to the Restated Certificate of Incorporation
of the Corporation was authorized pursuant to Section 141(b) of the Delaware
Corporation Law by the affirmative vote of a majority of the Board of Directors
of the Corporation present at a meeting at which a quorum was present followed
by the affirmative vote of a majority of all of the outstanding shares Common
Stock of the Corporation entitled to vote on the said Amendment to the Restated
Certificate of Incorporation at a meeting at which a quorum was present pursuant
to Section 242 of the Delaware General Corporation Law.
1
<PAGE>
D. This Certificate of Amendment to the Restated Certificate of
Incorporation shall be effective upon the filing of same with the Secretary of
State of Delaware.
IN WITNESS WHEREOF, we have subscribed this document on the date set
forth below and do hereby affirm, under the penalties of perjury, that the
statements contained therein have been examined by us and are true and correct.
Dated: July 9, 1993
/s/ Jean Madar
---------------------
Jean Madar, President
/s/ Neil Fogel
---------------------
Neil Fogel, Secretary
-Seal-
2
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.19
<SEQUENCE>5
<FILENAME>c20397_ex311.txt
<DESCRIPTION>STOCK OPTION PLAN
<TEXT>
Exhibit 4.19
INTER PARFUMS, INC.
2000 NONEMPLOYEE DIRECTOR
STOCK OPTION PLAN
**********
1. PURPOSE OF THE PLAN. The purpose of this 2000 Nonemployee Director
Stock Option Plan (the "Plan") of Inter Parfums, Inc., a Delaware corporation
(the "Corporation"), is to make available shares of the Common Stock, par value
$.001 per share, of the Corporation (the "Common Stock") for purchase by
directors of the Corporation who are not employees of the Corporation, or any
parent or subsidiary thereof ("Nonemployee Directors"). Thus, the Plan, in
addition to the Company's existing 1997 Nonemployee Director Stock Option Plan
("1997 Plan"), permits the Corporation to attract and retain the services of
experienced and knowledgeable Nonemployee Directors for the benefit of the
Corporation and its shareholders and to provide additional incentive for such
Nonemployee Directors to continue to work for the best interests of the
Corporation and its shareholders through continuing ownership of its Common
Stock.
2. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Article 10,
the total number of shares of Common Stock which may be subject to options under
the Plan shall not exceed 30,000, whether authorized but unissued shares, or
shares which shall have been purchased or acquired by the Corporation for this
or any other purpose. Such shares are from time to time to be allotted for
option and sale to Nonemployee Directors in accordance with the Plan. In the
event any option granted under the Plan shall expire or terminate for any reason
without having been exercised in full or shall cease for any reason to be
exercisable in whole or in part, the shares not so purchased thereby shall again
be available for the purposes of the Plan.
3. ADMINISTRATION OF THE PLAN. The Plan shall be self-executing.
However, to the extent permitted herein, the Plan shall be administered by
either the Board of Directors of the Corporation (the "Board") or a committee of
two (2) or more Nonemployee Directors (the "Committee") of the Board appointed
by the Board. The Board or the Committee shall, subject to the express
provisions of the Plan, have the power to interpret the Plan; correct any
defect, supply any omission or reconcile any inconsistency in the Plan;
prescribe, amend and rescind rules and regulations relating to the Plan; and
make all other determinations necessary or advisable for the administration of
the Plan. The determination of the Board or the Committee on the matters
referred to in this Article 3 shall be conclusive.
4. ELIGIBILITY; GRANTS.
(a) Nonemployee Directors shall not include directors who are also
employees of the Corporation or any parent or subsidiary thereof, but shall
include directors of the Corporation who are providing services such as
business, financial, legal or investment banking services, to, for, or on
1
<PAGE>
behalf of the Corporation or any parent or subsidiary thereof, in return for
remuneration, directly or indirectly through one or more entities.
(b) Each individual who subsequent to 19 December 2000 becomes a
Nonemployee Director, shall on the date of his initial election or appointment
to the Board be granted an option to purchase 2,000 shares of Common Stock, in
lieu of the initial option grants of 1,000 shares which such person is entitled
to receive under the 1997 Plan and 1,000 shares under the prior 1994 Nonemployee
Director Stock Option Plan (the "1994 Plan").
(c) Each Nonemployee Director other than Joseph A. Caccamo, shall be
granted an option to purchase 1,000 shares of Common Stock commencing on the
next February 1st, and each succeeding February 1st throughout the term of this
Plan for so long as he is a Nonemployee Director. In lieu of grants of options
to purchase 1,000 shares, Joseph A. Caccamo shall be granted options to purchase
4,000 shares hereunder for as long has he is a Nonemployee Director.
Notwithstanding the foregoing, no option shall be granted on such February 1st
grant date to any Nonemployee Director who first becomes a Nonemployee Director
within six (6) months prior to such February 1st grant date. The grants referred
to herein shall be in lieu of grants under the 1997 Plan and 1994 Plan.
(d) If a sufficient number of shares of Common Stock reserved for
issuance upon proper exercise of options to be granted to Nonemployee Directors
on the February 1st grant date does not exist, then the aggregate remaining
number of shares shall be prorated equally among options to be granted to all
Nonemployee Directors at such February 1st grant date, and options shall be
granted to purchase such reduced number of shares. Notwithstanding the
foregoing, if a sufficient number of shares of Common Stock reserved for
issuance upon proper exercise of options to be granted to Nonemployee Directors
on the February 1st grant date does not exist, then options shall be granted
under the 1997 Plan or the 1994 Plan in order to satisfy such deficiency, to the
extent available.
5. OPTION PRICE; FAIR MARKET VALUE.
(a) The price at which shares of the Common Stock may be purchased
pursuant to options granted under the Plan shall be equal to one hundred percent
(100%) of the fair market value of the Common Stock on the date an option is
granted.
(b) The fair market value of the Common stock on any day shall be (a)
if the principal market for the Common Stock is a national securities exchange,
the average between the high and low sales prices of the Common Stock on such
day as reported by such exchange or on a consolidated tape reflecting
transactions on such exchange; (b) if the principal market for the Common Stock
is not a national securities exchange and the Common Stock is quoted on The
Nasdaq Stock Market ("NASDAQ") or The Over The Counter Bulletin Board (the
"Bulletin Board"), and (i) if actual sales price information is available with
respect to the Common Stock, then the average between the high and low sales
prices of the Common Stock on such day on NASDAQ or the Bulletin Board, or (ii)
if such information is not available, then the average between the highest bid
and lowest asked prices
2
<PAGE>
for the Common Stock on such day on NASDAQ or the Bulletin Board; or (c) if the
principal market for the Common Stock is not a national securities exchange and
the Common Stock is not quoted on NASDAQ or the Bulletin Board, then the average
between the highest bid and lowest asked prices for the Common Stock on such day
as reported by National Quotation Bureau, Incorporated or a comparable service;
provided, that if clauses (a), (b) and (c) of this paragraph are all
inapplicable, or if no trades have been made or no quotes are available for such
day, then the fair market value of the Common Stock shall be determined by the
Committee by any method consistent with applicable regulations adopted by the
Treasury Department relating to stock options. The determination of the Board or
the Committee shall be conclusive in determining the fair market value of the
stock.
6. TERM OF EACH OPTION. The term of each option shall be five (5) years
or such shorter period as is prescribed in Article 9 hereof.
7. EXERCISE OF OPTIONS.
(a) Subject to the provisions of Articles 9 and 14, options granted
hereunder shall be exercisable immediately; provided, that options shall not be
exercisable at any time in an amount less than 100 shares (or the remaining
shares then covered by and purchasable under the option if less than 100
shares), or for a fraction of a share.
(b) The purchase price of the shares as to which an option shall be
exercised shall be paid in full at the time of exercise in cash, by certified
check or wire transfer of funds through the Federal Reserve System.
8. NON-TRANSFERABILITY OF OPTIONS. No option granted under the Plan
shall be transferable otherwise than by will or by the laws of descent and
distribution, or pursuant to a qualified domestic relations order as defined by
the Internal Revenue Code, Title I of the Employee Retirement Income Security
Act and the rules thereunder, and an option may be exercised, during the
lifetime of the holder thereof, only by him.
9. TERMINATION OF SERVICES ON THE BOARD OF DIRECTORS.
(a) If a Nonemployee Director to whom an option has been granted under
the Plan shall cease to serve on the Board, otherwise than by reason of death or
disability (as that term is defined in paragraph (d) of this Article 9), then
such option may be exercised (to the extent that the Nonemployee Director was
entitled to do so at the time of cessation of service) at any time within three
(3) months after such cessation of service but not thereafter, and in no event
after the date on which, except for such cessation of service, the option would
otherwise expire.
(b) If a Nonemployee Director to whom an option has been granted under
the Plan shall cease to serve on the Board by reason of disability, then the
remaining unexercised portion of the option may be exercised in whole or in part
by the Nonemployee Director (notwithstanding that the
3
<PAGE>
option had not yet become exercisable with respect to all or part of such shares
at the date of disability) at any time within one (1) year after such disability
but not thereafter, and in no event after the date on which, except for such
disability, the option would otherwise expire.
(c) If a Nonemployee Director to whom an option has been granted under
the Plan shall die (i) while he is serving on the Board, or (ii) within three
(3) months after cessation of service on the Board, then such option may be
exercised by the legatee or legatees of such option under the Nonemployee
Director's last will, or by his personal representatives or distributee, at any
time within one (1) year after his death, but in no event after the date on
which, except for such death, the option would otherwise expire.
(d) For the purpose of this Article 9, "disability" shall mean
permanent mental or physical disability as determined by the Committee.
10. ADJUSTMENT OF AND CHANGES IN COMMON STOCK.
(a) If the outstanding shares of the Common Stock are increased,
decreased, changed into, or exchanged for a different number or kind of Shares
or securities of the Corporation through reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or the like,
an appropriate and proportionate adjustment shall be made in the (i) aggregate
number and kind of securities available under the Plan, and (ii) number and kind
of securities receivable upon the exercise of all outstanding options granted
under the Plan, without change in the total price applicable to the unexercised
portion of such options, but with a corresponding adjustment in the price for
each unit of any security covered by such options.
(b) Upon the dissolution or liquidation of the Corporation, or upon a
reorganization, merger or consolidation of the Corporation with one or more
corporations as a result of which the Corporation is not the surviving
corporation, or upon the sale of substantially all of the assets of the
Corporation, the Committee shall provide in writing in connection with such
transaction for one or more of the following alternatives, separately or in
combination: (i) the assumption by the successor entity of the options
theretofore granted or the substitution by such entity for such options of new
options covering the stock of the successor entity, or a parent or subsidiary
thereof, with appropriate adjustments as to the number and kind of shares and
prices; or (ii) the continuance of such option agreements by such successor
entity in which such options shall remain in full force and effect under the
terms so provided.
(c) Any adjustments under this Article 10 shall be made by the
Committee, whose good faith determination as to what adjustments shall be made,
and the extent thereof, shall be final, binding and conclusive.
11. COMPLIANCE WITH SECURITIES LAWS. As a condition to the exercise of
any option, either (a) a Registration Statement under the Securities Act of
1933, as amended, or any succeeding act (collectively, the "Act"), with respect
to its underlying shares shall be effective at the time of exercise
4
<PAGE>
of the option or (b) in the opinion of counsel to the Corporation, there shall
be an exemption from registration under the Act for the issuance of shares of
Common Stock upon such exercise. Nothing herein shall be construed as requiring
the Corporation to register shares subject to the Plan or any option under the
Act. Each opinion shall be subject to the further requirement that if, in the
opinion of counsel to the Corporation, the listing or qualification of the
shares of Common Stocks subject to such option on any securities exchange,
National Securities Association or under any applicable law, or the consent or
approval of any governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the exercise of such option or the issue of
shares thereunder, such option may not be exercised in whole or in part unless
such listing, qualification, consent or approval shall have been effected or
obtained free of any conditions requiring the Corporation to qualify as a
foreign corporation or to execute a general consent to service of process in any
jurisdiction wherein it has not already done so and free of any other conditions
not customarily imposed by a securities exchange, law or governmental regulatory
body in connection with such listing, qualification, consent or approval.
12. AMENDMENT AND TERMINATION. The Committee may amend, suspend or
terminate the Plan or any portion thereof at any time but may not, without the
approval of the Corporation's shareholders within twelve (12) months before or
after the date of adoption of any such amendment or amendments, make any
alteration or amendment thereof which (a) makes any change in the class of
eligible participants as determined in accordance with Article 4 hereof; (b)
increases the total number of shares of Common Stock for which options may be
granted under the Plan except as provided in Article 10 hereof; (c) extends the
term of the Plan or the maximum option period provided under the Plan; (d)
decreases the option price provided in Article 5 hereof; or (e) materially
increases the benefits accruing to participants under the Plan. Notwithstanding
anything to the contrary contained herein, the Plan shall not be amended more
than once every six (6) months, other than to comport with changes in the
Internal Revenue Code, Employee Retirement Income Security Act or the rules
thereunder.
13. DUTIES OF THE CORPORATION. The Corporation shall, at all times
during the term of each option, reserve and keep available for issuance or
delivery such number of shares of Common Stock as will be sufficient to satisfy
the requirements of all options at the time outstanding, shall pay all original
issue taxes with respect to the issuance or delivery of shares pursuant to the
exercise of such options and all other fees and expenses necessarily incurred by
the Corporation in connection therewith.
14. TERM; EFFECTIVE PERIOD.
(a) The Plan shall become effective on 19 December 2000, the date of
its adoption by the Board of Directors, subject to approval by the holders of a
majority of shares of the Corporation's capital stock outstanding and entitled
to vote thereon at the next meeting of its shareholders, or the written consent
of the holders of a majority of shares that would have been entitled to vote
thereon, and no options granted hereunder may be exercised prior to such
approval, PROVIDED THAT, the date of
5
<PAGE>
grant of any options granted hereunder shall be determined as if the Plan had
not been subject to such approval.
(b) No options may be granted under the Plan after 18 December 2010.
Options outstanding on or prior to such date shall, however, in all respects
continue subject to the Plan.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.78
<SEQUENCE>6
<FILENAME>c20397_ex10-78.txt
<DESCRIPTION>BANK AGREEMENT
<TEXT>
Exhibit 10.78
HSBC Bank USA
HSBC Bank USA of New York
452 Fifth Avenue
New York, NY 10018
Telephone 212 525 5000
June 1, 2000
Inter Parfums, Inc.
551 Fifth Avenue
New York, N.Y. 10176
Attn: Mr. Russell Greenberg, CFO/EVP
Ladies and Gentlemen:
We are pleased to confirm that we are extending to you a line of credit
of up to an aggregate amount of $12,000,000 outstanding at any one time, which
line may be used by your company for direct borrowings and acceptance and sight
letters of credit exposure for working capital purposes, provided, however, the
outstanding amount as to which our Bank is liable, directly or contingently, on
behalf of your company in respect of letter of credit and acceptance financings
cannot in the aggregate at any one time exceed $2,000,000, and $1,000,000,
respectively. This line is subject to the provisions set forth herein and in the
other documents entered into in connection with this facility.
Borrowings under this line of credit shall be evidenced by a Demand
Grid Note, a copy of which is enclosed. Under this facility borrowings may be
made from time to time and shall be repayable on demand, but may be prepaid in
whole or in part with accrued interest to the date of prepayment. Any amounts
outstanding shall bear interest, payable monthly in arrears, at a variable rate
per annum equal to 0% above our Bank's Reference Rate established from time to
time, all as more fully set forth in the Demand Grid Note.
Or, at your option, you may borrow under a LIBOR Pricing Revolving Note
up to the maximum amount of $12,000,000 in $100,000 increments, provided
however, the amount outstanding under LIBOR Pricing Revolving Notes is no less
than $500,000, with advances priced at your option of one month, two months,
three months or six months LIBOR plus 1.75% for each LIBOR rate advance and
subject to the terms of the LIBOR Pricing Revolving Note; a copy of the LIBOR
Pricing Revolving Note is attached herewith. Please note that the advances under
the LIBOR Pricing Revolving Note may be prepaid, but only subject to the terms
and conditions set forth in that note.
Each letter of credit issued for your account shall be issued only
pursuant to our standard form of application for commercial letter of credit
(the "Application"), as executed by you from time to time. You shall pay a fee
of 1/8 of 1% when we issue any letter of credit for your account and each time
we amend any such letter of credit. In addition, you shall pay a fee of 1/8 of
1% of
<PAGE>
the face amount of any sight draft presented to us in accordance with the terms
of any letter of credit we issue for your account. Such fee shall be payable
when such draft is presented to us and honored by us, all as more fully set
forth in the Application. Any amounts due to us from you under the Application
shall bear interest payable on demand at a variable rate per annum equal to the
rate from time to time in effect under the Demand Grid Note. At our option such
amounts may be deemed additional advances evidenced by and repayable in
accordance with the Demand Grid Note. In place of the foregoing demand
reimbursement obligation, we may from time to time accept your time drafts of up
to 180 days presented to us by you. When such time draft is accepted by us it
will be discounted from its date of maturity at a rate per annum equal to 2%
plus our acceptance rate for commercial drafts or bills of exchange of
comparable amounts and maturities.
Your obligations under this line of credit shall be guaranteed by your
subsidiary, Elite Parfums, Ltd. (for the obligations of Jean Philippe
Fragrances, Inc.) and by your parent, Jean Philippe Fragrances, Inc., (for the
obligations of Elite Parfums, Ltd.).
This facility may be utilized by you for the period ending May 31,
2001; provided, however, THE CONTINUING AVAILABILITY OF THIS FACILITY IS AT ALL
TIMES SUBJECT TO OUR CONTINUING SATISFACTION, AS DETERMINED BY OUR BANK IN ITS
SOLE AND ABSOLUTE DISCRETION, WITH THE BUSINESS, AFFAIRS AND FINANCIAL CONDITION
OF YOUR COMPANIES AND OF EACH GUARANTOR AND TO YOUR COMPLIANCE, AND THAT OF EACH
OTHER PARTY EXECUTING AND DELIVERING DOCUMENTS TO US HEREUNDER OR OTHERWISE IN
CONNECTION WITH THIS FACILITY, WITH THE TERMS AND PROVISIONS OF THIS LETTER AND
EACH OF THE DOCUMENTS REFERRED TO HEREIN. In addition, the continuing
availability of this facility is subject to your furnishing us, (i) within 120
days after the close of your fiscal year, with your audited financial statements
certified by your independent certified public accountants as of the end of such
period, including a balance sheet and related income statements; and (ii) such
other information, including interim financial statements, concerning your
business, affairs or financial condition as we may from time to time request.
All payments of principal, interest and fees payable by you under this
facility shall be made in immediately available funds at our office at 452 Fifth
Avenue, New York, New York 10018 and may be charged to any account you maintain
with us.
Our agreement to extend to you this facility, on the terms set forth
herein, is further subject to our receipt in form satisfactory to us of (a) a
certified copy of resolutions of your Board of Directors authorizing your
execution, delivery and performance of this agreement (and the documents
hereinafter referred to); (b) signature cards for your authorized signatories;
(c) an executed copy of our Demand Grid Note signed by your duly authorized
officer on your behalf, (d) executed copies of our standard form of Guarantee
signed by Elite Parfums, Ltd. (for the obligations of Jean Philippe Fragrances,
Inc.) and Jean Philippe Fragrances, Inc., (for the obligations of Elite Parfums,
Ltd.
<PAGE>
NO AMENDMENT, MODIFICATION OR WAIVER OF ANY PROVISION OF THIS AGREEMENT
NOR CONSENT TO ANY DEPARTURE BY OUR BANK THEREFROM SHALL BE EFFECTIVE,
IRRESPECTIVE OF ANY COURSE OF DEALING, UNLESS THE SAME SHALL BE IN WRITING AND
SIGNED BY OUR BANK AND THEN SUCH WAIVER OR CONSENT SHALL BE EFFECTIVE ONLY IN
THE SPECIFIC INSTANCE AND FOR THE SPECIFIC PURPOSE FOR WHICH GIVEN.
This agreement shall be governed by and construed in accordance with
the laws of the State of New York. Please note that to the extent any of the
terms or provisions of this agreement conflict with those contained in the
Demand Grid Note or any of the above-mentioned documents, the terms and
provisions of such Note and of such other documents shall govern.
YOU AND OUR BANK AGREE THAT ANY ACTION, SUIT OR PROCEEDING IN RESPECT
OF OR ARISING OUT OF THIS AGREEMENT, THE NOTE OR ANY OTHER DOCUMENTS RELATING TO
THIS FACILITY MAY BE INITIATED AND PROSECUTED IN THE STATE OR FEDERAL COURTS, AS
THE CASE MAY BE, LOCATED IN NEW YORK COUNTY, NEW YORK.
YOU FURTHER AGREE THAT ANY ACTION, DISPUTE, PROCEEDING, CLAIM OR
CONTROVERSY BETWEEN OR AMONG YOU AND US WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE ("DISPUTE" OR "DISPUTES") SHALL, AT OUR ELECTION, WHICH ELECTION MAY
BE MADE AT ANY TIME PRIOR TO THE COMMENCEMENT OF A JUDICIAL PROCEEDING BY OUR
BANK, OR IN THE EVENT OF A JUDICIAL PROCEEDING INSTITUTED BY YOU AT ANY TIME
PRIOR TO THE LAST DAY TO ANSWER AND/OR RESPOND TO A SUMMONS AND/OR COMPLAINT
MADE BY YOU, BE RESOLVED BY ARBITRATION IN NEW YORK, NEW YORK IN ACCORDANCE WITH
THE PROVISIONS OF THIS PARAGRAPH AND SHALL, AT THE ELECTION OF OUR BANK, INCLUDE
ALL DISPUTES ARISING OUT OF OR IN CONNECTION WITH (I) THIS AGREEMENT, THE DEMAND
GRID NOTE, OR ANY OTHER RELATED AGREEMENTS OR INSTRUMENTS, (II) ALL PAST,
PRESENT AND FUTURE AGREEMENTS INVOLVING THE PARTIES, (III) ANY TRANSACTION
CONTEMPLATED HEREBY AND ALL PAST, PRESENT AND FUTURE TRANSACTIONS INVOLVING THE
PARTIES AND (IV) ANY ASPECT OF THE PAST, PRESENT OR FUTURE RELATIONSHIP OF THE
PARTIES. We may elect to require arbitration of any Dispute with us without
thereby being required to arbitrate all Disputes between you and us. Any such
Dispute shall be resolved by binding arbitration in accordance with Article 75
of the New York Civil Practice Law and Rules and the Commercial Arbitration
Rules of the American Arbitration Association ("AAA"). In the event of any
inconsistency between such Rules and these arbitration provisions, these
provisions shall supersede such Rules. All statutes of limitations which would
otherwise be applicable shall apply to any arbitration proceeding under this
paragraph. In any arbitration proceeding subject to these provisions, the
arbitration panel (the "arbitrator") is specifically empowered to decide (by
documents only, or with a hearing, at the arbitrators sole discretion)
pre-hearing motions which are substantially similar to pre-hearing motions to
dismiss and motions for summary adjudication. In any such arbitration
proceeding, the arbitrator shall not have the power or authority to award
punitive damages to any party.
<PAGE>
Judgment upon the award rendered may be entered in any court having
jurisdiction. Whenever an arbitration is required, the parties shall select an
arbitrator in the manner provided in this paragraph. No provision of, nor the
exercise of any rights under, this paragraph shall limit the right of any party
(i) to foreclose against any real or personal property collateral through
judicial foreclosure, by the exercise of a power of sale under a deed of trust,
mortgage or other security agreement or instrument pursuant to applicable
provisions of the Uniform Commercial Code, or otherwise pursuant to applicable
law, (ii) to exercise self help remedies including but not limited to setoff and
repossession, or (iii) to request and obtain from a court having jurisdiction
before, during or after the pendency of any arbitration, provisional or
ancillary remedies and relief including but not limited to injunctive or
mandatory relief or the appointment of a receiver. The institution and
maintenance of an action or judicial proceeding for, or pursuit of, provisional
or ancillary remedies or exercise of self help remedies shall not constitute a
waiver of our right, even if we are the plaintiff, to submit the Dispute to
arbitration if we would otherwise have such right. We may require arbitration of
any Dispute(s) concerning the lawfulness, unconscionableness, propriety, or
reasonableness of any exercise by us of our right to take or dispose of any
collateral or our exercise of any other right in connection with collateral
including, without limitation, judicial foreclosure, exercising a power of sale
under a deed of trust or mortgage, obtaining or executing a writ of attachment,
taking or disposing of property with or without judicial process pursuant to
Article 9 of the Uniform Commercial Code or otherwise as permitted by applicable
law, notwithstanding any such exercise by us. Whenever an arbitration is
required under this paragraph, the arbitrator shall be selected, except as
otherwise herein provided, in accordance with the Commercial Arbitration Rules
of the AAA. A single arbitrator shall decide any claim of $100,000 or less and
he or she shall be an attorney with at least five years' experience. Where the
claim of any party exceeds $100,000, the Dispute shall be decided by a majority
vote of three arbitrators, at least two of whom shall be attorneys (at least one
of whom shall have not less than five years' experience representing commercial
banks). In the event of any Dispute governed by this paragraph, each of the
parties shall, subject to the award of the arbitrator, pay an equal share of the
arbitrator's fees. The arbitrator shall have the power to award recovery of all
costs and fees (including attorneys' fees, administrative fees, arbitrator's
fees, and court costs) to the prevailing party.
ANYTHING IN THIS AGREEMENT, THE NOTE OR ANY OTHER DOCUMENTS RELATING TO
THIS FACILITY TO THE CONTRARY NOTWITHSTANDING, THE ENUMERATION IN THIS
AGREEMENT, THE NOTE OR IN SUCH OTHER DOCUMENTS OF SPECIFIC OBLIGATIONS TO OUR
BANK AND/OR CONDITIONS TO THE AVAILABILITY OF THIS FACILITY AND THE NOTE SHALL
NOT BE CONSTRUED TO QUALIFY, DEFINE OR OTHERWISE LIMIT OUR RIGHT, POWER OR
ABILITY, AT ANY TIME, UNDER APPLICABLE LAW, TO MAKE DEMAND FOR PAYMENT OF THE
ENTIRE OUTSTANDING PRINCIPAL OF AND INTEREST DUE UNDER THIS FACILITY AND THE
NOTE OR OUR RIGHT NOT TO MAKE ANY EXTENSION OF CREDIT UNDER THIS FACILITY AND
YOU AGREE THAT YOUR BREACH OF OR DEFAULT UNDER ANY SUCH ENUMERATED OBLIGATIONS
OR CONDITIONS IS NOT THE ONLY BASIS FOR DEMAND TO BE MADE OR FOR A REQUEST FOR
AN EXTENSION OF CREDIT TO BE DENIED, AS YOUR OBLIGATION TO MAKE PAYMENT SHALL AT
ALL TIMES REMAIN A DEMAND OBLIGATION. NOTWITHSTANDING ANYTHING IN THIS
<PAGE>
AGREEMENT TO THE CONTRARY, THIS AGREEMENT DOES NOT CREATE A COMMITMENT OR
OBLIGATION TO LEND BY THE BANK AND YOU ACKNOWLEDGE THAT THE BANK HAS NO
OBLIGATION TO LEND.
EACH OF YOU AND WE HEREBY WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM BROUGHT BY OR AGAINST IT ON ANY MATTERS WHATSOEVER, IN CONTRACT
OR IN TORT, ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT, THE NOTE
OR ANY OTHER DOCUMENTS RELATING TO THIS FACILITY. YOU ALSO HEREBY WAIVE THE
RIGHT TO INTERPOSE ANY DEFENSE BASED UPON ANY CLAIM OF LACHES OR SET-OFF OR
COUNTERCLAIM OF ANY NATURE OR DESCRIPTION, ANY OBJECTION BASED ON FORUM NON
CONVENIENS OR VENUE, AND ANY CLAIM FOR CONSEQUENTIAL, PUNITIVE OR SPECIAL
DAMAGES.
If this agreement is acceptable to you, please sign and return to us
one copy each of the enclosed copy of this letter and the other documents
referred to above on or before July 15, 1999.
Very truly yours,
HSBC BANK USA
/s/ Andrew Ross
--------------------------
By: Andrew Ross
Title: First Vice President
Agreed to and accepted:
INTER PARFUMS, INC.
By: /s/ Russell Greenberg
- -------------------------------
Title: Executive Vice President
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.79
<SEQUENCE>7
<FILENAME>c20397_ex10-79.txt
<DESCRIPTION>BAIL FRENCH
<TEXT>
Exhibit 10.79
BAIL
ENTRE LES SOUSSIGNES :
La SOCIETE MAJ0RQUE, Societe a responsabilite
Limitee, au capital de 1 000 000 de francs, ayant son
siege social a Wissous (91320), 18 avenue Ampere,
immatriculee au Registre du Commerce et des Societes
d'Evry, sous le numero B 420 026 387, representee par
son Gerant Mademoiselle Emily Benharrous.
Ci-apres denommes [LE BAILLEUR>>,,
D'UNE PART,
ET:
La SOCIETE INTER PARFUMS; Societe Anonyme, au capital
de 45 515 720 francs, ayant son siege social au 4
Rond point des Champs-Elysees 75008 Paris,
Immatriculee au Registre du Commerce et des Societes
de Paris, sous le numero B 350 219 382, representee
par Monsieur Benacin Philippe, President du Conseil
de Surveillance, dument habilite aux presentes.
Ci-apres denommee [ LE PRENEUR>>,
D'AUTRE PART,
IL A ETE ARRETE ET CONVENU CE QUI SUIT:
Le bailleur fait bail et donne a loyer, conformement
aux dispositions du decret n(degree) 53-960 du 30
septembre 1953 modifie, a la societe Inter Parfums ce
qui est accepte par cette derniere, les locaux dont
la designation suit, dependant d'un immeuble sis a
Paris 8e, 18 avenue Franklin Roosevelt.
Article 1er - DESIGNATION
Dependant de l'immeuble sis a Paris 8e, 18 avenue
Frankin Roosevelt, au 1er etage:
- Un local comprenant dix bureaux, une cuisine, une
piece a archives, deux WC dont un double, un hall
d'entree. Chauffage individuel electrique. Tels que
ces locaux resultent des plans d-apres annexes
(annexe 1).
<PAGE>
2
Ainsi que lesdits locaux existent, se poursuivent et
comportent, sans aucune exception ni reserve, et sans
qu'il soit besoin d'en faire une plus ample
designation, le preneur declarant les connaitre pour
les avoir vus et visite en vue des presentes. Les
parties conviennent que les lieux loues forment un
tout indivisible.
ARTICLE 2 - DUREE
Le present bail est conclu et accepte pour une duree
de neuf annees, a compter du 7 avril 2000.
Le preneur pourra y mettre fin a l'issue de chaque
periode triennale, dans les conditions prevues par le
decret du 30 septembre 1953.
Compte tenu des renovations necessaires dans ces
locaux, le bailleur consent une franchise de loyer et
charges de deux mois, le premier reglement du loyer
et charges interviendra donc le 7 juin 2000.
ARTICLE 3 - ENTREE EN JOUISSANCE ET ETAT DES LIEUX
Les locaux seront pris dans l'etat ou ils se
trouveront le jour de l'entree en jouissance, sans
que le preneur puisse exiger de reparations, ni de
travaux, de quelque nature que ce soit, pendant tout
le cours de la location.
Le preneur restera tenu pendant tout le cours de la
location de toutes les reparations locatives.
Les lieux loues devront etre rendus, en fin de
location, en parfait etat de reparations locatives.
Le preneur ne pourra exiger aucune remise en etat,
aucune reclamation ni aucun travail, et il ne pourra
exercer aucun recours contre le bailleur pour cas de
force majeure et toutes autres causes quelconques
interessant l'etat des locaux.
Le preneur prendra en charge tous les travaux
d'amenagement, installations et constructions
ordonnees par une legislation ou reglementation en
matiere d'hygiene ou de securite, dans les locaux
eux-memes.
ARTICLE 4 - DESTINATION DES LIEUX
Le preneur ne pourra donner aux dits lieux aucune
autre destination que celle prevue au present bail, a
savoir:
VENTE DE PRODUITS COSMETIQUES
Le preneur devra exercer dans le local de maniere
permanente les activites mentionnees cidessus.
<PAGE>
3
ARTICLE 5 - CHARGES ET CONDITIONS
Le present bail est fait, en outre, sous les charges
et conditions suivantes que le preneur s'oblige a
executer et accomplir a peine de tous dommages
interets, et meme de resiliation si bon semble au
bailleur:
1(degree)) Le preneur devra garnir et tenir
garnis les lieux presentement loues de materiel,
marchandises, meubles et objets mobiliers, en qualite
et valeur suffisante pour repondre du paiement des
loyers et de l'execution des conditions du bail.
2(degree)) Le preneur ne pourra fermer les
locaux presentement loues qui devront rester ouverts
pour l'exploitation de l'activite commerciale sus
designee, pendant tout le cours du bail et jusqu'a
son expiration, sauf cas de force majeure ou
necessite par le preneur d'effectuer des travaux
necessitant la fermeture.
3(degree)) Il tiendra les locaux en bon etat
de toutes reparations locatives, ceci pendant toute
la duree du bail, et fera a cet egard a ses frais
tous travaux ou reparations de toute nature qui sont
ou pourront devenir necessaires y compris celles
pouvant decouler d'une obligation reglementaire, de
facon, a les rendre, a la fin du bail, en bon etat de
reparations locatives.
II est egalement convenu qu'au cas ou
l'administration ou quelque autorite que ce soit
viendrait a exiger, a un moment quelconque une
modification et/ou affectation du local, meme si
cette exigence etait consecutive a un cas de force
majeure, toutes charges et consequences quelconques
de cette modification et/ou affectation seraient
integralement supportees par le preneur qui s'y
oblige. Neanmoins, il ne pourra etre impose au
preneur de realiser les travaux necessaires a cette
modification et/ou affectation du local.
4(degree)) Le preneur s'engage a entretenir
et remplacer a ses frais, quelle que soit
l'importance des travaux et reparations (fut-ce par
vetuste) toutes installations, canalisations,
appareils, fermetures, et plus generalement tous les
elements garnissant ou composant les lieux loues,
sans exception.
Le preneur accepte qu'a defaut d'avoir effectue
lui-meme tous travaux d'entretien, de reparations et
de remplacement mis a sa charge, le bailleur
entreprenne, trente jours apres l'envoi d'une lettre
recommandee avec demande d'avis de reception restee
infructueuse, et sauf cas d'urgence, en ses lieu et
place lesdits travaux et reparations, le preneur
s'engageant a en rembourser le cout effectif, en ce
compris tout frais et honoraires s'y rapportant, dans
les quinze jours de l'etat qui lui sera adresse par
le bailleur.
5(degree)) II jouira des lieux en bon pere
de famille suivant leur destination telle qu'elle est
indiquee ci-dessus, il ne pourra en aucun cas rien
faire ou laisser faire qui puisse les deteriorer, et
il devra prevenir immediatement le bailleur de tout
atteinte qui sera portee a l'ensemble de la
propriete, et de toutes degradations ou
deteriorations qui viendraient a se produire dans les
lieux loues.
6(degree)) II devra deposer sans delai tous
coffrages et decoration ainsi que toutes
installations qu'il aurait faites et dont
l'enlevement serait necessaire pour la recherche et
la reparation de fuites de toute nature, de fissure
dans les conduits de fumee ou de ventilation,
notamment apres incendie ou infiltrations et, en
general, pour l'execution des travaux, des lors que
cette recherche se sera revelee justifiee.
<PAGE>
4
II ne pourra invoquer en quoi que ce soit la
responsabilite du bailleur, dans le cas ou les
services publics d'eau ou d'electricite seraient
interrompus dans l'immeuble, par suite de reparations
ou autres causes.
7(degree)) Le preneur ne pourra faire dans
les lieux loues aucune construction, ni demolition,
concernant le gros oeuvre de l'immeuble, aucun
percement des murs, cloisons ou planchers, sans le
consentement expres et par ecrit du bailleur, les
travaux qui seraient autorises par celui-ci devront
etre faits sous la surveillance de son architecte
dont les honoraires seront a la charge du preneur.
L'autorisation de travaux devra etre materialisee par
trois actes :
o un descriptif precis,
o un plan modificatif faisant mention de l'etat
existant,
o les souscriptions d'assurances necessaires a la
realisation des travaux.
lesquels devront etre signes et approuves par le
bailleur.
Toutefois, a l'occasion de la demande d'autorisation,
le bailleur pourra conditionner son accord par la
remise en etat des lieux en leur etat primitif.
8(degree)) Tous embellissements,
constructions, modifications, ameliorations,
installations et decors quelconques qui seraient
faits par le preneur dans les lieux loues, pendant le
cours du bail, resteront a la fin de celui-ci, a
quelque epoque et de quelque maniere qu'elle arrive,
la propriete du bailleur, sans aucune indemnite pour
le preneur, en ce compris les installations
electriques, la climatisation dans son ensemble et
tous autres elements d'equipement eventuellement
installes dans les lieux loues sans limitation.
Le preneur supportera sans recours contre le bailleur
les travaux qui seront executes dans l'immeuble, sur
la voie publique, ou dans les immeubles voisins alors
meme qu'il en resulterait une gene pour son
exploitation.
9(degree)) Le preneur devra supporter a ses
frais toute modification d'arrivee de branchement, de
remplacement de compteur ou d'installations
interieures pouvant etre exigees par les compagnies
distributrices des eaux, de l'electricite, du
chauffage ou de conditionnement d'air.
En particulier, en cas d'installation d'un systeme de
climatisation a eau perdue, il s'oblige a installer a
ses frais un compteur divisionnaire.
10(degree)) Le preneur devra se conformer a
toutes les charges, reglements de ville, de police et
de voirie, et ne rien faire qui puisse troubler la
tranquillite ou apporter un trouble de jouissance aux
voisins, et aux habitants de l'immeuble, notamment
par le bruit, les odeurs, la fumee, etc.,... le
proprietaire declinant toute responsabilite a cet
egard.
11(degree)) II devra se conformer
rigoureusement pour l'exploitation de son activite,
aux lois, reglements et prescriptions
administratives, et devra faire son affaire
personnelle de l'execution, s'il y a lieu, de toutes
modifications ou installations qui pourraient etre
prescrites par l'administration ou les services
d'hygiene, de maniere que le bailleur ne puisse
jamais etre inquiete a ce sujet.
12(degree)) II devra prendre toutes
precautions necessaires pour eviter tous bruits,
odeurs, fumees et pour empecher l'existence de tout
animaux ou insectes nuisibles. II devra exercer une
surveillance continuelle sur son personnel et veiller
a sa bonne tenue.
<PAGE>
5
II souffrira l'installation et le passage de toutes
canalisations d'eau, de gaz, d'electricite et de
chauffage, de tous conduits, quel que soit leur
emplacement, qu'ils soient apparents ou non, qu'ils
puissent se trouver dans le local loue, dans ses
accessoires ou dans ses dependances, et ceci dans
toute la mesure exigee non seulement pour le service
de ses propres locaux, mais pour les services de
l'immeuble.
13(degree)) Toutes les reparations
locatives, et meme les refections et remplacements
qui seraient necessaires au cours du bail, aux glaces
et vitres, volets, verrieres, descentes, chutes
d'eau, etc ...., interessants les lieux loues, seront
a la charge du preneur. Celui-ci sera tenu de
maintenir le tout en bon etat de proprete,
d'entretien et de fonctionnement.
14(degree)) Le preneur ne pourra reclamer au
bailleur des indemnites de dommages interets,
reduction de loyer, pour fuites, inondations, degats
des eaux ou infiltrations quelconques, qui
viendraient a se produire dans les lieux loues pour
quelque cause que ce soit.
15(degree)) Le preneur devra laisser le
bailleur, son mandataire et toute personne munie de
l'autorisation du bailleur, visiter les lieux loues
quand il le jugera utile, notamment en cas de travaux
ou reparations et durant les six mois qui precederont
la fin de la presente location, etant entendu que le
bailleur devra prevenir le preneur suffisamment a
l'avance et par ecrit, et prendre les dispositions
necessaires pour perturber le moins possible son
activite.
De meme le preneur devra laisser le
bailleur, son mandataire et toute personne munie de
l'autorisation du bailleur, visiter les lieux loues
quand il le jugera utile en cas de mise en vente de
l'immeuble pendant les trois mois qui suivront la
mise en vente.
16(degree)) Le preneur assurera et
maintiendra assures pendant toute la duree du bail,
contre les risques d'incendie et d'explosion,
implosion, bris de glaces, ainsi que les risques
locatifs, le recours des tiers et des voisins, les
degats des eaux, la presente enumeration n'etant pas
limitative, les meubles, objets mobiliers, materiel,
marchandises garnissant les lieux loues. Les glaces
et vitres du local ne sont pas assurees au titre de
l'immeuble.
II devra acquitter regulierement les primes et
justifier du tout a premiere requisition du bailleur.
En ce qui concerne plus particulierement
l'exploitation des locaux, le preneur devra
l'assurer, en conformite des prescriptions
administratives et legales pouvant s'y rapporter.
Le preneur assurera les locaux loues a leur valeur de
reconstruction.
17(degree)) Responsabilite et recours:
Le preneur et ses assureurs renoncent expressement a
tous recours et actions contre le bailleur et ses
assureurs, soit du fait de la destruction totale ou
partielle de ses materiels, meubles, objets mobiliers
et marchandises, et plus generalement tous objets lui
appartenant ou dont il serait detenteur a quelque
titre que ce soit, soit du fait de leur
deterioration, soit encore du fait de la privation de
jouissance des lieux, et meme au cas de perte totale
ou partielle de son fonds de commerce, y compris les
elements incorporels attaches audit fonds.
Reciproquement, le bailleur et ses assureurs
renoncent expressement a tout recours et actions
qu'ils seraient en droit d'exercer contre le preneur
et ses assureurs, en cas de dommages quels qu'ils
soient, directs ou indirects, subis par les locaux
loues, le materiel ou mobilier mis a sa disposition,
ainsi que du fait des pertes de loyers, troubles de
jouissance ou pertes d'exploitation causee a des
tiers pouvant en resulter.
<PAGE>
6
De meme, le preneur declare renoncer a tout recours
contre le bailleur et son ou ses assureurs.
- En cas de dommages, dincendie, de vol, de degat des
eaux, d'humidite ou de toute autre circonstance
atteignant ses biens propres ou les biens pouvant
etre consideres comme immeubles par nature, par
destination ou par incorporation installee a ses
frais, le preneur devant s'assurer contre ces
risques,
- En cas de vol ou autre acte delictueux dont le
preneur pourrait etre victime dans le local,
- En cas de notification, d'interruption ou de
suppression du gardiennage de l'immeuble,
- En cas d'interruption ou de fonctionnement
intempestif dans le service de l'eau, du gaz, de
l'electricite, de la climatisation ou d'une maniere
generale, en cas de mise hors service ou d'arret,
meme prolonge, pour une cause independante de la
volonte du bailleur, dans le service des fluides, du
chauffage ou de l'un quelconque des elements
d'equipement commun de I'immeuble,
Le preneur renonce egalement a reclamer au bailleur,
en cas de dommages materiels ou immateriels non
causes intentionnellement par le bailleu, des
indemnites pour privation de jouissance ou perte
d'exploitation du fait de I'interruption, totale ou
partielle, de son exploitation pour quelque cause que
ce soit.
18(degree)) Le preneur acquittera exactement
ses impots, la taxe professionnelle, et, d'une facon
generale, tous les impots, contributions et taxes lui
incombant et dont le bailleur pourrait etre
responsable a un titre quelconque. II devra en
justifier au bailleur a toute requisition.
II supportera egalement l'impot foncier afferent aux
lieux loues et tous impots nouveaux concernant les
locaux qui viendraient a etre exiges par
l'Administration Fiscale, quand bien meme ces impots
incomberaient normalement au bailleur.
II supportera egalement le droit au bail et la taxe
additionnelle de droit au bail, si le bailleur ne
maintient pas son option pour la TVA.
19(degree)) Le preneur sera tenu de regler,
depuis la date d'effet du bail, au bailleur ou a son
gerant, sa quote-part de toutes les charges,
prestations ou depenses relatives a l'immeuble, y
compris les impots et taxes afferents a l'immeuble,
tels que taxe de balayage, taxe d'enlevement des
ordures menageres et des dechets industriels. et
commerciaux, taxes foncieres et assimilees, ainsi que
toute taxe nouvelle ou ceux ou celles qui en seraient
le remplacement.
20(degree)) Enfin, il reglera directement
ses consommations d'electricite, d'eau, de chauffage
et les frais de tous abonnements telephoniques, taxes
et le cout de toutes communications.
21(degree)) Le preneur ne devra faire poser
aucune enseigne, ni plaque publicitaire sur la facade
des locaux loues, ni meme modifier l'aspect exterieur
de l'immeuble par I installation de tente, marquise,
store, enseigne, etc ..... sans autorisation du
bailleur, de l'Administration concernee et de la
copropriete.
Si le preneur souhaite apposer une plaque
commerciale, celle-ci devra etre en concordance avec
l'aspect de l'immeuble, installee pres de celle deja
existante, dans les memes dimensions et style de ces
dernieres, au frais exclusif du preneur, et
l'approbation devra etre prealablement obtenue.
<PAGE>
7
II supportera le cout de toute taxe ou redevance
relative a ces enseignes.
22(degree)) Le preneur ne pourra faire
aucune demande de reduction de loyer, ni indemnite en
cas de suppression, d'interruption ou de mauvais
fonctionnement des divers services de l'immeuble
(chauffage, eau, electricite, etc., ...) quelles
qu'en soient la cause et la duree.
23(degree)) Le preneur s'engage a emmenager
et demenager la plus grande partie de son mobilier
par les fenetres du local donne en location.
ARTICLE 6 - CESSION - SOUS-LOCATIONS
Le preneur ne pourra conceder la jouissance des lieux
loues, a qui que ce soit, sous quelque forme que ce
soit, meme temporairement, et a titre gratuit et
precaire, il ne pourra sous-louer en tout ou partie
des locaux, ni mettre son fonds en location-gerance.
Neanmoins, le preneur pourra sous-louer ou domicilier
une ou des societes appartenant juridiquement au meme
groupe que le preneur, dans les locaux loues. Pour ce
faire, celui-ci devra presenter au bailleur, par
courrier en lettre recommandee avec accuse de
reception, pour approbation, la ou les societes.
Cette approbation devra faire l'objet d'une
confirmation et d'un accord ecrit entre les parties,
a savoir: le preneur, le bailleur et le ou les
sous-locataires.
Quoiqu'il en soit, et a aucun moment, le ou les
sous-locataires ne pourront se prevaloir de droits
directs ou indirects a l'encontre du bailleur, le
preneur restant l'unique garant, responsable et
solidaire des charges et conditions du present bail
objet des presentes.
Etant precise que le ou les sous-locataires ne
seraient titulaires a aucun moment d'aucun droit, ni
d'aucun titre d'occupation opposable au bailleur a
l'echeance du bail.
Le preneur ne pourra ceder son droit au present bail
si ce n'est en totalite a l'acquereur de la totalite
de son fonds de commerce qui exercera la totalite des
activites prevues au bail, et a charge pour lui
d'appeler le bailleur a la cession, sous peine de
nullite de la cession consentie au mepris de cette
clause; et meme de resiliation des presentes, si bon
semble au bailleur.
Le preneur restera garant, conjointement et
solidairement avec son cessionnaire, et tous
cessionnaires successifs, du paiement des loyers, des
charges echues et a echoir, et de l'execution des
conditions du present bail.
Pour etre valable, toute cession devra etre constatee
en presence du bailleur ou lui dument appele.
Un exemplaire enregistre de l'acte de cession devra
etre remis au bailleur sans frais pour lui, dans le
delai de 15 jours de la cession.
Le preneur devra notifier au bailleur, par lettre
recommandee avec accuse de reception, le projet
d'acte de cession dans son integralite, en lui
indiquant notamment, a peine de nullite de la
notification, le nom et l'adresse de l'acquereur, le
prix, les modalites de paiement et, d'une maniere
generale, toutes les conditions de la cession
projetee, ainsi que les lieux, jour et heure prevus
pour la realisation de cette cession qui ne pourra
intervenir moins d'un mois apres reception de cette
notification.
<PAGE>
8
Ce projet sera signe par le candidat acquereur, avec
la mention que ce projet est signe a titre de simple
declaration d'intention. Sil est survenu entre les
parties des accords de force obligatoire, meme
souscrits sous la condition suspensive de la purge du
droit de preference et des formalites de concours, la
notification qui precede devra obligatoirement
comporter denonciation de l'integralite dudit acte.
Le bailleur aura la faculte, dans le mois de la
reception de cette notification, d'informer le
preneur dans les memes formes, en conformite du droit
de preference qui lui est reconnu, a egalite de
conditions, de sa decision d'user de ce droit a son
profit ou a celui de toute personne physique ou
morale qu'il lui plaira de se substituer.
En cas de mise en oeuvre du droit de preference, la
cession devra alors etre regularisee sous quinzaine.
Le droit de preference ainsi defini s'imposera dans
les memes conditions aux acquereurs successifs,
pendant toute la duree du bail, de ses prorogations
ou renouvellements.
La condition de forme ci-dessus et, notamment, les
dispositions relatives au droit de preference
s'appliqueront a toutes les cessions quelles qu'en
soient la forme et les modalites: cession onereuse ou
gratuite, cession ou apport du droit au bail et du
fonds de commerce, cession amiable ou par
adjudication.
ARTICLE 7 - REGLEMENT INTERIEUR- REGLEMENT DE
COPROPRIETE
Dans l'interet de la securite, de l'hygiene, du bon
ordre et de la proprete de l'immeuble, le preneur
s'engage a faire en sorte que son comportement soit
paisible et a respecter, outre les arretes municipaux
et prefectoraux, toutes les consignes qui pourraient
lui etre donnees par le bailleur. II ne pourra faire,
dans les lieux loues, aucune vente publique de
meubles ou autres objets.
II ne devra faire emploi d'aucun appareil ou machine
qui, par le bruit, l'odeur, l'humidite ou les
trepidations qu'il occasionnerait, serait de nature a
incommoder les autres locataires, les voisins ou
nuire a l'immeuble.
II devra satisfaire a toutes les charges de ville et
de police prevues ou imprevues, dont les locataires
sont ordinairement tenus, et se conformer aux
reglements de police.
Le preneur devra deposer ces ordures personnelles
dans les containers prevus a cet effet dans
l'enceinte du batiment.
De meme, il est formellement convenu que, ni le
bailleur, ni ses preposes ne seront tenus pour
responsables des vols, detournements, cambriolages ou
tentatives de ces delits au prejudice du locataire et
des depredations meme immobilieres qui en
resulteraient, et que le bailleur ne saurait encourir
aucune responsabilite tant en raison des services
personnels demandes par le preneur a ses preposes,
tels que commission, communications, qu'a raison des
cles, especes ou objets quelconques qu'ils
detiendraient pour le compte de locataires ou de
tiers.
De convention expresse, le bailleur degage d'ores et
deja sa responsabilite, conformement aux dispositions
de l'article 1725 du Code Civil, pour tous dommages
ou troubles de jouissance qui pourraient, du fait de
tiers, etre causes au preneur, lequel renonce a tous
recours contre elle et pourra exercer directement son
recours, si bon lui semble, contre les auteurs du
trouble, le bailleur le subrogeant en outre, par les
presentes, dans ses droits et actions a cet effet.
<PAGE>
9
II devra, en cas d'absence, laisser les cles des
locaux a une personne qu'il designera au bailleur,
afin qu'en cas d'accidents, incendie, fuite d'eau ou
de gaz, ou des travaux ou toute autre cause, il soit
possible d'acceder dans les lieux loues, qu'en cas de
sinistre, toutes les precautions necessaires puissent
etre prises immediatement.
ARTICLE 8 - LOYER PRINCIPAL
Le present bail est consenti et accepte moyennant un
loyer annuel de 587 500 FRANCS (CINQ CENT QUATRE
VINGT SEPT MILLE CINQ CENT FRANCS) hors charges et
hors taxes, que le preneur s'oblige a payer avec la
taxe a la valeur ajoutee y afferente, par trimestre
et a termes echoir. Les trimestres commencent les
premiers janvier, avril, juillet, et octobre.
ARTICLE 9 - PASSAGE A LA MONNAIE UNIQUE EUROPEENNE
En tant que de besoin et conformement aux principes
generaux du droit monetaire, il est rappele que les
creances de sommes d'argent libellees en/ou payables
en francs francais en vertu des presentes seront
considerees de plein droit, comme libellees et/ou
payables en monnaie unique europeenne lorsque le
franc cessera d'etre legal, ou plus generalement,
sera remplace par la monnaie unique europeenne
conformement a la reglementation communautaire et/ou
nationale.
Le taux et les conditions de conversion du franc
francais seront ceux resultant de l'application des
dispositions de l'article 109-L du Traite de l'Union
Europeenne.
Bien entendu, le remplacement du franc francais par
la monnaie unique europeenne n'entrainera ni
novation, ni rupture entre les parties et ce, meme si
pour des raisons techniques, l'Indice National du
Cout de la Construction publie par l'INSEE venait a
etre remplace par un indice de substitution ou un
indice similaire ou equivalent.
Article 10 - CLAUSE D'ECHELLE MOBILE
Le loyer ci-dessus fixe sera revise automatiquement
chaque annee a la date du et pour la premiere fois le
1er avril 2001, en plus ou en moins et en proportion
exacte de la variation de l'indice publie par l'INSEE
du cout de la construction, l'indice de base
contractuellement choisi etant celui du 3e trimestre
de l'annee 1999 (1080), raison pour laquelle la
premiere revision au 1er avril 2001 interviendra en
fonction de la variation des indices des 3e trimestre
1999 et 3e trimestre 2000.
Pour les annees suivantes, l'indice de comparaison
servant de calcul a la revision sera l'indice, du 3e
trimestre de l'annee qui precede la revision et
l'indice de base, l'indice du 3e trimestre de l'annee
qui precede l'indice de comparaison.
Si pour une raison quelconque, l'indice publie par
l'INSEE devenait inapplicable, les parties
conviennent d'un commun accord de le remplacer par un
nouvel indice equivalent, qui sera determine, a
defaut d'accord, par voie d'ordonnance sur requete de
Monsieur le President du Tribunal de Grande Instance
de Paris.
La clause d'indexation du prix du loyer constitue une
clause essentielle et determinante sans laquelle le
bailleur n'aurait pas contracte.
<PAGE>
10
ARTICLE 11- PAIEMENT DU LOYER
Le preneur s'oblige au paiement du loyer et de ses
accessoires au bailleur, aux quatre termes de
l'annee, les premiers janvier, avril, juillet et
octobre.
A cet effet, le preneur s'engage a verser au bailleur
la somme fixee par lui, a titre d'acompte sur
charges, prestations, fournitures, taxes et autres.
En fin d'exercice, soit le 31 decembre de chaque
annee, un compte definitif sera etabli sur l'avis
d'echeance de juin et le trop-percu eventuel sera
rembourse.
Le bailleur s'engage a communiquer au preneur, a
premiere demande de ce dernier, tout justificatif
relatif au compte definitif de charges. En cas de
cessation de la location, en cours d'annee, le compte
definitif sera etabli en fonction des resultats de
l'exercice precedent, et des previsions de l'exercice
en cours.
En cas de contentieux, l'imputation des paiements
effectues par le preneur sera faite par le bailleur
dans l'ordre suivant:
- frais de recouvrement et de procedure
- dommages et
interets
- interets
- depot de garantie et reajustement du depot de
garantie
- creance de loyers ou indemnites d'occupation;
concernant ces postes, l'imputation sera faite par
le bailleur par priorite sur les sommes n'ayant
pas fait l'objet de contentieux
- ajustements du fond de roulement
- provision sur charges communes
A I interieur de chacun de ces postes, priorite sera
donnee aux locaux accessoires ou annexes par
preference au local principal.
ARTICLE 12 - DEPOT DE GARANTIE
Pour surete et garantie de l'execution des
obligations de toute nature resultant du present bail
a la charge du preneur, ce dernier verse ce jour la
somme de 146 875 FRANCS correspondant a trois mois de
loyer de la premiere annee.
Cette somme sera conservee par le bailleur pendant
toute la duree du bail jusqu'au reglement entier et
definitif de toute indemnite, de quelques nature
qu'elle soit, que le preneur pourrait devoir au
bailleur a l'expiration du bail et a sa sortie des
locaux.
Cette somme ne sera pas productive d'interet.
Dans le cas de resiliation de bail pour inexecution
de ses conditions, ou pour une cause quelconque
imputable a la preneuse, ce versement de garantie
restera acquis au bailleur, a titre de premiers
dommages interets, sans prejudice de tous autres.
<PAGE>
11
II est expressement convenu qu'en cas de variation du
loyer en vertu de la clause ci-dessus stipulee, la
somme versee a titre de depot de garantie devra etre
mise en harmonie avec le nouveau loyer de facon a ce
que le depot de garantie soit toujours d'un montant
egal a trois mois de loyer. Le preneur versera, lors
du paiement du premier terme augmente, la somme
necessaire pour completer le depot et, en cas de
diminution de loyer, le bailleur restituera au
preneur la somme en excedent.
En outre, s'agissant d'une creance a l'encontre du
bailleur, elle est necessairement connexe a toute
creance nee des presentes, dont pourrait exciper le
bailleur a l'encontre du preneur et des lors, dans
l'hypothese d'un redressement ou d'une liquidation
judiciaire, le bailleur est fonde a compenser le
montant de ce depot de garantie avec toutes sommes
susceptibles de faire, dans son interet, l'objet
d'une declaration de creance, sans que la
modification ne modifie la nature de la creance et
les eventuels privileges attaches a cette creance.
ARTICLE 13 - CHARGES COMMUNES DE L'IMMEUBLE
Le reglement des charges par le preneur se fera par
le versement d'une provision calculee
trimestriellement par rapport aux charges
anterieures. Ces provisions viendront en deduction
des charges reelles calculees annuellement.
Pour la premiere annee, la provision est de 52 875
FRANCS (CINQUANTE DEUX MILLE HUIT CENT SOIXANTE
QUINZE FRANCS), la TVA etant facturee en sus.
La contribution du preneur aux charges sera calculee
conformement a la repartition en vigueur dans
I'immeuble, soit 261 m2 pour le lot concerne des
parties communes generales de I'immeuble, sur un
total de 2061 m2.
II est precise que les charges correspondent:
- a tous les impots de I immeuble, y compris
I'impot foncier,
- aux prestations fournies par le bailleur et
se rapportant a I'immeuble ainsi qu'aux
charges de copropriete dans leur
integralite, a l'exclusion des travaux de
l'article 606 du Code Civil,
- aux depenses d'equipement, d'entretien, de
nettoyage, de maintenance, de refection, de
reparations, de remplacements, de
renouvellement, de reconstruction, de
surveillance, de gardiennage, de securite,
de mise en conformite, d'amelioration, meme
si ces travaux sont occasionnes par la
vetuste ou sauf s'ils concernent ceux vises
par l'article 606 du Code civil, de gestion
des parties communes, sans que cette
enumeration soit limitative, - aux frais et
honoraires de syndic,
de maniere a ce que le loyer percu par le bailleur
soit net et franc de tout frais quelconques.
Les provisions seront payables trimestriellement dans
les conditions et aux dates de paiement des loyers.
Au cas ou en fin de trimestre, la provision versee se
revelerait inferieure aux charges anterieures, le
preneur s'engage a rembourser, sur premier appel du
bailleur, toutes les sommes qui se reveleraient
necessaires pour compenser le montant des charges
reelles.
Le bailleur effectuera un arrete annuel des comptes.
En consequence, il s'engage a fournir au preneur un
decompte exact des charges locatives pour l'annee
ecoulee qui devra etre adresse dans un delai de six
mois a l'expiration de ladite annee, chaque annee
prise en consideration etant une annee civile.
<PAGE>
12
Ce decompte, apres certification par le gerant de
I'immeuble, aura un caractere definitif, tant
vis-a-vis du bailleur que du preneur.
Si en fin d'annee, les provisions versees se revelent
inferieures aux charges reelles, le preneur s'engage
a rembourser, sur premier appel du bailleur, toutes
les sommes qui seront necessaires pour compenser le
montant total des charges reelles. Les sommes trop
versees viendraient en deduction des provisions de
l'annee en cours.
Au cas ou, pour une raison quelconque, le preneur
serait amene a quitter les locaux, objet du present
bail, le montant correspondant au decompte des
provisions versees par le preneur jusqu'a son depart
et les charges reellement payees par le bailleur
jusqu'a cette epoque, se fera de plein droit par
imputation sur le depot de garantie tel que prevu aux
presentes.
ARTICLE 14 - CLAUSE PENALE
Toute somme due par le preneur au titre des charges,
clauses et conditions du present bail sera
automatiquement augmentee de 10 % si le paiement
n'intervient pas dans le delai de 10 jours suivant la
mise en demeure effectuee par le bailleur, soit par
acte extrajudiciaire, soit par lettre recommandee
avec demande d'avis de reception.
ARTICLE 15 - INDEMNITE D'OCCUPATION
Dans l'hypothese ou malgre une decision constatant
les effets de la clause resolutoire, ou la
resiliation du bail, le preneur refuserait de liberer
les lieux, il serait alors redevable d'une indemnite
d'occupation fixee sur la base du dernier loyer
contractuel augmente de 50% et ce, jusqu'a liberation
effective des lieux loues.
Article 16 - CLAUSE RESOLUTOIRE
A defaut par le preneur d'executer une seule des
charges et conditions du bail ou encore de payer a
son echeance un seul terme de loyer, partiellement ou
en totalite, ou encore a defaut de payer 1es
accessoires du loyer, le montant de la clause penale,
le montant de l'indemnite d'occupation, tous arrieres
resultant de la fixation judiciaire, notamment en
revision ou en renouvellement, ce qui inclut les
interets de droits fixes judiciairement sur ces
complements d'arrieres de loyers, tous autres
interets contractuels, les complements de depot de
garantie, et d'une facon generale, a defaut de
paiement de toutes sommes dues en application des
presentes, le bail sera resilie de plein droit et
sans aucune formalite judiciaire, un mois apres une
mise en demeure d'executer ou une Sommation de payer
demeuree sans effet pendant ce delai, et contenant
declaration par le bailleur de son intention d'user
du benefice de la presente clause.
Dans tous les cas, si le preneur se refuse a quitter
les lieux, bien que le bail soit resilie de plein
droit, son expulsion pourra etre ordonnee par simple
ordonnance de refere rendue par Monsieur le President
du Tribunal de Grande Instance, qui sera executoire
sur minute par provision.
Article 18 - TOLERANCES - USAGES LOCAUX
Aucun fait de tolerance de la part du bailleur ne
pourra creer un droit au profit du preneur, ni creer
une derogation aux presentes.
<PAGE>
13
Pour tout ce qui n'est pas prevu, il est refere a la
loi et aux usages locaux.
ARTICLE 19 - ELECTION DE DOMICILE
Pour l'execution des presentes, les parties font
election de domicile, a savoir:
- le bailleur a son domicile ou siege social,
- le preneur dans les lieux loues.
Le preneur s'oblige a informer le bailleur de tout
changement de son siege social.
Fait en deux exemplaires originaux,
En 13 pages et une annexe
A Paris, le 31/03/2000
LE PRENEUR LE BAILLEUR
ANNEXES: Plans des locaux
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.79.1
<SEQUENCE>8
<FILENAME>c20397_ex10-791.txt
<DESCRIPTION>LEASE
<TEXT>
Exhibit 10.79.1
1
LEASE
BETWEEN THE UNDERSIGNED:
MAJORQUE, a Limited Liability Company with capital of 1,000,000 Francs,
headquartered in Wissous (91320), 18 avenue Ampere, recorded with the Register
of Commerce and Companies of Evry under No. B 420 026 387, represented by its
Manager, Ms. Emily Benharrous.
Hereinafter "LESSOR,"
PARTY OF THE FIRST PART,
AND:
INTER PARFUMS, a corporation with capital of 45,515,720 Francs, with
headquarters at 4 Rond-Point des Champs-Elysees, 75008 Paris, recorded with the
Register of Commerce and Companies of Paris under No. B 350 219 382, represented
by Mr. Philippe Benacin, Chairman of the Supervision Board, duly authorized for
this instrument.
Hereinafter "LESSEE,"
PARTY OF THE SECOND PART,
THE FOLLOWING HAS BEEN ESTABLISHED:
Lessor leases and rents, pursuant to the provisions of decree No. 53-960 of
September 30, 1953, as amended, to Inter Parfums, which the latter accepts, the
premises described below, in a building located in Paris 8th (arrondissement),
18 avenue Franklin Roosevelt.
ARTICLE 1 - DESCRIPTION
In the building located in Paris 8th (arrondissement), 18 avenue Franklin
Roosevelt, on the 1st floor:
- - A space including ten offices, a kitchen, a file room, two toilets (one of
which double), an entrance. Individual electric heating.
As these spaces arise from the enclosed plan (Addendum 1).
<PAGE>
2
As said premises exist and are, without any exception or reservation, without
need of more ample description since Lessee declares that it knows them, having
seen and visited them for the purpose hereof. The parties agree that the leased
premises form an indivisible whole.
ARTICLE 2 - TERM
This lease is granted and accepted for a term of nine years, from April 7, 2000.
Lessee may cancel at the end of each three-year period, under the conditions set
forth in the decree of September 30, 1953.
Given the renovations necessary in these premises, Lessor grants a two-month
grace period for the rent and charges, so that the first payment of rent and
charges will take place on June 7, 2000.
ARTICLE 3 - OBTAINING ENJOYMENT AND STATEMENT OF THE CONDITION OF THE PREMISES
The premises will be taken as they are on the beginning date of enjoyment,
whereby Lessee may not require repairs or work of any nature throughout the term
of the lease.
Throughout the term of the lease, Lessee must make all tenant repairs.
At the end of the lease, the leased premises must be returned in perfect tenant
repair condition.
Lessee may not require any renovation, any claim or any work, and may not
exercise any remedy against Lessor due to cases of force majeure and any other
causes of any type in connection with the condition of the premises.
Lessee will pay for all fitting out work, installations and construction ordered
by a law or regulation in matters of hygiene or safety on the premises
themselves.
ARTICLE 4 - UTILIZATION OF THE PREMISES
Lessee may not give the premises any utilization other than that set forth in
this lease, to wit:
SALE OF COSMETIC PRODUCTS
Lessee must permanently engage in the aforementioned activities on the premises.
[initials]
<PAGE>
3
ARTICLE 5 - CHARGES AND CONDITIONS
In addition, this lease is executed under the following charges and conditions
which Lessee pledges to perform and accomplish under penalty of any damages and
even cancellation if Lessor so chooses:
1) Lessee must furnish and keep furnished the leased premises with
equipment, merchandise, furniture and movables, in sufficient quality and value
to cover the payment of the rent and the performance of the conditions of the
lease.
2) Lessee may not close the leased premises, which must remain open for
the aforementioned commercial activity throughout the term of the lease and
until its expiration, except in case of force majeure or Lessee's need to do
work that requires closing.
3) It will keep the premises in good tenant repair conditions
throughout the term of the lease and will do at its own expense all works or
repairs of any nature which are or may become necessary, including those that
may arise from a regulatory obligation, so that at the end of the lease, it may
return them in good tenant repair condition.
It is also agreed that, should the administration or any authority whatsoever
require, at a certain time, a modification and/or utilization of the space, even
if such requirement follows a case of force majeure, all charges and
consequences of this modification and/or utilization will be fully paid by
Lessee, which pledges to do so. However, Lessee may not be obligated to do the
work necessary for such modification and/or utilization of the space.
4) Lessee pledges to maintain and replace, at its expense, any amount
of work and repairs (including due to old age) all installations, pipes,
devices, closures and, more generally, all elements furnishing or making up the
leased premises, without exception.
Lessee agrees that, should it fail to do all work related to maintenance, repair
and replacement in its charge, Lessor may do such work and repairs in its place
and stead, thirty days after sending a registered letter with return receipt
requested, which remains without response, except in emergencies; Lessee pledges
to reimburse the actual cost thereof, including all related expenses and fees
within fifteen days from receipt of Lessor's statement.
5) It will enjoy the premises as a good head of family, in accordance
with the utilization indicated above, and may not, in any case, do or cause
anything to be done that may deteriorate them; it must immediately notify Lessor
of any damage caused to the entire property and all damage or deterioration
produced on the leased premises.
6) It must remove without delay all frames and decoration as well as
all installations done by it and that need to be removed in order to seek and
repair leaks of all types, cracks in smoke or
<PAGE>
4
ventilation stacks, especially after a fire or leak, and in general, for the
execution of work, provided such search is proven to be justified.
[initials]
It may not invoke in any manner the liability of Lessor if the public water or
electricity services are interrupted in the building following repairs or other
causes.
7) Lessee may not engage on the leased premises in any construction or
demolition concerning the masonry of the building, nor piercing of walls,
partitions or floors, without express written consent from Lessor, whereby the
work authorized by the latter must be done under the supervision of its
architect, whose fees will be paid by Lessee.
The work authorization must be materialized in three acts:
o a precise description
o a modification plan mentioning the current condition
o the insurance policies necessary for the realization of the work
which must be signed and approved by Lessor.
However, at the time of the request for authorization, Lessor may condition its
agreement on the restoration of the premises to their original state.
8) All embellishments, constructions, modifications, improvements,
installations and decorations of any type done by Lessee on the leased premises
during the term of the lease, remain, at the end of the lease, at any time and
under any status, property of Lessor, without any indemnity for Lessee,
including electric installations, air conditioning units in their entirety, and
all other elements of equipment possibly installed on the leased premises,
without limitation.
Lessee will allow, without remedy against Lessor, the work executed in the
building, on the public road, or in neighboring buildings, even if they
constitute a nuisance for its operation.
9) Lessee must pay for any modification of the incoming pipe,
replacement of the meter or internal installations that may be required by the
distributors of water, electricity, heating or air conditioning.
In particular, in the event or installation of a lost water air conditioning
system, it pledges to install a separate meter at its own expense.
10) Lessee must comply with all charges, city regulations, police and
road regulations and do nothing that may trouble the tranquility or cause a
trouble of enjoyment to the neighbors and to the inhabitants of the building,
especially due to noise, odors, smoke, etc., whereby the owner declines any
liability in this regard.
11) It must rigorously comply, in the operation of its activity, with
laws, regulations and
<PAGE>
5
administrative prescriptions, and must take upon itself, if applicable, any
modifications or installations that may be required by the administration or
health services so that Lessor may never be preoccupied in this regard.
[initials]
12) It must take all necessary precautions to avoid all noises, odors,
and smoke and to prevent the existence of any harmful animals or insects.
It must continuously supervise its personnel and assure their correct behavior.
<PAGE>
6
It will allow the installation and passage of all water, gas, electricity, and
heating pipes, all ducts regardless of their location, apparent or not found on
the leased premises and its accessories or appurtenances, to the entire extent
required, not only for the service of its own premises, but for the service of
the building.
13) All tenant repairs concerning the leased premises, including
repairs and replacements that become necessary during the lease, in glass and
mirrors, shutters, glass panes, chutes, water chutes, etc., will be paid by
Lessee. It will have the obligation to maintain everything in good cleanliness,
maintenance and operating condition.
14) Lessee may not claim from Lessor damages or rent reduction for
leaks, floods, water damages or infiltrations of any type produced on the leased
premises for any reason whatsoever.
15) Lessee must allow Lessor, its agent, and any person bearing the
authorization of Lessor to visit the leased premises whenever they deem fit,
especially in the event of work or repairs or during six months before the end
of this lease; with the understanding that Lessor must notify Lessee
sufficiently in advance and in writing, and take all necessary steps to
interfere as little as possible with its activity. Furthermore, Lessee must
allow Lessor, its agent, or any person bearing the authorization of Lessor to
visit the leased premises whenever they deem fit in the event of sale of the
building, during three months after the building is put on the market.
16) Lessee will insure and keep insured throughout the term of the
lease against the risks of fire and explosion, implosion, glass breakage, as
well as tenant risks, remedy of third parties and neighbors, water damages,
without limitation to this list, the furniture, movables, equipment and
merchandise found on the leased premises. The mirrors and glass in the space are
not insured together with the building.
It must regularly pay premiums and prove such payment at the first request of
Lessor.
Concerning more particularly the operation of the premises, Lessee must insure
it pursuant to applicable administrative and legal regulations.
Lessee will insure the leased premises at their reconstruction value.
17) Liability and remedy:
Lessee and its insurers expressly waive any remedy and action against Lessor and
its insurers, either due to the total or partial destruction of its equipment,
furniture, movables and merchandise and, more generally, any objects belonging
to it or in its possession for any reason whatsoever, or for their deterioration
or for deprivation of enjoyment of the premises, and even in the event of total
or partial loss of its business, including the intangible elements related to
such business.
Reciprocally, Lessor and its insurers expressly waive any remedy and actions to
which they may be
<PAGE>
7
entitled against Lessee and its insurers, in the event of damage of any type,
direct or indirect, incurred by the leased premises, equipment or furniture made
available to Lessee, as well as for loss of rent, trouble of enjoyment, or loss
of operation caused to third parties that may arise therefrom.
[initials]
Furthermore, Lessee declares that it waives any remedy against Lessor and its
insurer/s.
- - In the event of damage, fire, theft, water damage, humidity or any
other circumstance affecting its own assets and the assets that may be
considered real estate by nature, by utilization or by incorporation,
installed at its expense, whereby Lessee must take insurance against
such risks,
- - In the event of theft or other criminal act to which Lessee may be
victim in the premises,
- - In the event of notification, interruption, or elimination of the
security guard of the building,
- - In the event of interruption or untimely operation in water, gas,
electricity, air conditioning service or, in general, in the event of
interruption or stoppage, even prolonged, for a cause beyond the
control of Lessor, in fluid service, heating, or any elements of the
common equipment of the building,
Lessee also waives claims against Lessor, in the event of material or intangible
damage not intentionally caused by Lessor, indemnity for deprivation of
enjoyment or loss of operation due to the total or partial interruption of its
operation for any reason whatsoever.
18) Lessee will pay exactly the taxes, professional tax, and in
general, all taxes, contributions, and dues payable by it, and for which Lessor
may be responsible for any reason. It must prove such payment to Lessor at any
request.
It will also pay the land tax for the leased premises and any new taxes
concerning the premises that may be required by the Tax Administration, even if
normally such taxes are paid by Lessor.
It will also pay the lease fee and the additional lease fee tax if Lessor does
not maintain its VAT option.
19) Lessee will be obliged to pay, from the effective date of the
lease, to Lessor or its manager, its share of all charges, services or expenses
or the building, including the taxes and dues related to the building, such as
sweeping tax, tax for removal of household garbage and industrial or commercial
waste, land taxes and related taxes, as well as any new tax or those replacing
them.
[handwritten] land tax ~14,000 Francs
-------------
20) Finally, it will pay directly its consumption of electricity,
water, heating, and the expenses of all telephone subscriptions, taxes, and cost
of all communications.
<PAGE>
8
21) Lessee must not cause the installation of any sign or advertising
plaque on the facade of the leased premises, nor modify the exterior appearance
of the building by installing awnings, canopies, blinds, signs, etc., without
authorization from Lessor, the Administration concerned, and the condominium.
Should Lessee wish to install a commercial plate, it must be in accordance with
the appearance of the building, installed next to the existing one, in the same
size and style as the latter, at Lessee's exclusive expenses and with prior
approval.
[initials]
It will pay the cost of any tax or royalty related to these signs.
22) Lessee may not request a reduction of rent or indemnity in the
event of suppression, interruption or poor operation of the various services of
the building (heating, water, electricity, etc.), regardless of their cause and
duration.
23) Lessee pledges to move in and move out most of its furniture
through the windows of the leased space.
ARTICLE 6 - TRANSFERS - SUBLEASES
Lessee may not transfer the enjoyment of the leased premises to any party, in
any form, even temporarily, be it free of charge and precarious, and may not
sublease all or part of the premises or place its business under lease
management.
However, Lessee may sublease or domicile one or several companies legally
belonging to the same group as Lessee on the leased premises. To do so, it must
submit the company or companies to Lessor, by registered letter with
acknowledgment of receipt, for approval.
Such approval must be the object of a written confirmation and agreement between
the parties, to wit: Lessee, Lessor, and the subLessee or subLessees.
In any event and at any time, the subLessee or subLessees may not claim direct
or indirect rights against Lessor, whereby Lessee remains the sole guarantor,
jointly liable for the charges and conditions of this lease.
It is specified that the subLessee or subLessees will not have at any time any
right or any occupancy title enforceable against Lessor at the end of the lease.
Lessee may not transfer its right in this lease other than in whole to the buyer
of its entire business, which will perform all activities described in the
lease, with obligation to call the Lessor to participate in the transfer, under
penalty of nullity of the transfer granted in violation of this clause, and even
cancellation of this lease, if Lessor so chooses.
<PAGE>
9
Lessee will remain joint ly and severally guarantor with its transferee and all
subsequent transferees for the payment of rent, charges accrued or yet to
accrue, and for the performance of the conditions hereof.
To be valid, any transfer must be instrumented in the presence of Lessor or
after duly inviting Lessor to participate.
A registered copy of the transfer document must be given to Lessor at no charge,
within 15 days from the transfer.
Lessee must send to Lessor, by registered letter with acknowledgment of receipt,
the draft transfer instrument in its entirety, indicating in particular, under
penalty of nullity of the notification, the name and address of the buyer, the
price, payment terms and, in general, all the conditions of the planned
transfer, as well as the places, day and time scheduled for the execution of
this transfer, which may not take place less than one month after receipt of
this notification.
[initials]
Said draft will be signed by the candidate buyer, with the mention that the
draft is signed as a simple declaration of intent. If the parties executed
binding agreements, even with the suspensive condition of settlement of the
preferred rights and settlement of creditors' rights, the above notification
must include the termination of the entire said instrument.
Lessor will have the right, within one month from receipt of said notification,
to inform Lessee in the same manner, in accordance with the preferred right
recognized to it, under equal conditions of its decision to use this right for
its own profit or for any individual or artificial person it wishes to
substitute.
In the event of exercise of the preferred right, the transfer must then be
settled within fifteen days.
The preferred right so defined will be imposed under the same conditions to the
successive buyers during the entire term of the lease, its extension, or
renewals.
The formal condition above, and, in particular, the provisions concerning the
preferred right, will apply to all transfers regardless of their form and
method; transfers for payment or free of charge, transfer or contribution of the
lease right and business, amicable or court-ordered transfer.
ARTICLE 7 - INTERNAL REGULATION - CONDOMINIUM REGULATION
In the interest of the security, hygiene, good order and cleanliness of the
building, Lessee pledges that its behavior will be peaceful and to comply, in
addition to municipal and prefectural decisions, with all orders that may be
given to it by Lessor. It may not engage on the leased premises in any public
sale of furniture or other objects.
<PAGE>
10
It must not use any device or machine which, by noise, odor, humidity, or
trepidations would be of a nature to bother the other tenants, the neighbors or
to damage the building.
It must pay all city and police charges, foreseen or unforeseeable, usually paid
by tenants, and comply with police regulations.
Lessee must deposit its personal garbage in the containers installed for this
purpose in the building.
Furthermore, it is formally agreed that neither Lessor nor its employees will be
responsible for theft, embezzlement, robbery, or attempts of such crimes against
the tenant and the resulting damage, including to the real estate assets, and
that Lessor will not take any responsibility for the personal services requested
by Lessee from its employees, such as commission, communications, other than in
connection with the keys, cash, or objects held by them on behalf of the tenants
or third parties.
By express agreement, Lessor declines responsibility as of now, pursuant to
article 1725 of the Civil Code for any damage or trouble of enjoyment that may
be caused to Lessee because of third parties; Lessee waives any remedy against
it and may exercise directly its remedy, if it so chooses, against the authors
of the trouble, whereby, in addition, Lessor hereby subrogates it in its rights
and actions in relation to this issue.
[initials]
In the event of absence, it must leave the keys of the premises with a person
designated by it to Lessor, so that in the event of accident, fire, water or gas
leak, work, or any other reason, it may be possible to access the leased
premises and that, in the event of loss, all necessary precautions may be taken
immediately.
ARTICLE 8 - MAIN RENT
This lease is granted and accepted for an annual rent of 587,500 FRANCS (FIVE
HUNDRED EIGHTY-SEVEN THOUSAND FIVE HUNDRED FRANCS) not including charges and
taxes, which Lessee pledges to pay with the related value added tax, by quarter
and on maturity. The quarters begin on the first day of January, April, July and
October.
ARTICLE 9 - TRANSITION TO THE SINGLE EUROPEAN CURRENCY
As needed and pursuant to the general principles of monetary law, receivables of
amounts of money, expressed and/or payable in French Francs hereunder, will be
ipso jure considered expressed and/or payable in the single European currency
when the Franc stops being legal or, more generally, is replaced by the single
European currency pursuant to community and/or national regulations.
<PAGE>
11
The rate and conditions for the conversion of the French Francs will be those
resulting from the application of the provisions of article 109-L of the Treaty
of the European Union.
Of course, the replacement of the French Franc by the single European currency
will not cause an innovation or breach between the parties, even if, for
technical reasons, the National Construction Cost Index published by INSEE is
replaced by a substitution index or a similar or equivalent index.
ARTICLE 10 - SLIDING SCALE CLAUSE
The rent established above will be automatically revised each year on the due
date and for the first time on April 1, 2001, upwards or downwards and in the
exact proportion of the variation of the Construction Cost Index published by
INSEE whereby the contractually chosen base index is that of the third quarter
of 1999 (1080), so that the first revision on April 1, 2001 will be based on the
variation of the indexes of the third quarter 1999 and third quarter 2000.
For the following years, the comparison index used to calculate the revision
will be the index of the third quarter of the year preceding the revision and
the base index, the index of the third quarter of the year preceding the
comparison index.
If, for any reason, the index published by INSEE becomes inapplicable, the
parties agree to replace it by a new equivalent index which will be determined,
in the absence of agreement, by order upon request of the President of the Court
of First Instance of Paris.
The rent indexation clause constitutes an essential and decisive clause without
which Lessor would not have contracted.
[initials]
ARTICLE 11 - PAYMENT OF THE RENT
Lessee pledges to pay the rent and its incidentals to Lessor, on the four due
dates during the year, on the first day of January, April, July and October.
For this purpose, Lessee pledges to pay to Lessor the amount established by the
latter as down payment on charges, services, supplies, taxes and others. At the
end of the year, i.e., December 31 of each year, a final statement will be
issued with the due date notice of June, and any possible excess paid will be
reimbursed.
Lessor pledges to communicate to Lessee, at the first request of the latter, any
receipt related to the final statement of charges. In the event of assignment of
the lease during the year, the final statement will be issued with the results
of the prior year and projections for the current year.
In the event of dispute, the payments made by Lessee will be applied by Lessor
in the following order:
<PAGE>
12
- - expenses for collection and proceedings
- - damages
- - interest
- - security deposit and adjustment of the security deposit
- - receivables for rent or occupancy indemnities; concerning these
items, the application will be made by Lessor with priority from the amounts
that are not contested
- - adjustment in the working capital fund
- - provision on common charges
Within each of these items, priority will be given to accessories or
appurtenances over the main space.
ARTICLE 12 - SECURITY DEPOSIT
As a surety and guarantee for the performance of the obligations of all types
arising from this lease for Lessee, the latter pays today the amount of 146,875
Francs corresponding to three months of rent in the first year.
This amount will be kept by Lessor during the entire term of the lease until
full and final payment of any indemnity of any nature Lessee may owe to Lessor
at the end of the lease and when it vacates the premises.
This amount will not produce interest.
In the event of cancellation of the lease for non-performance of these
conditions or for any cause imputable to Lessee, such guarantee payment will
remain in the hands of Lessor as first damages, without prejudice to all others.
[initials]
It is expressly agreed that, in the event of variation in rent under the above
clause, the amount paid as security deposit must be matched to the new rent, so
that the security deposit is always in an amount equal to three months of rent.
Lessee will pay, when paying the first increased rent, the amount necessary to
replenish the deposit, and in the event of reduction of the rent, Lessor will
refund to Lessee the amount in excess.
In addition, in the case of Lessor's debt, it must be offset against any
receivables arising from this lease possibly held by Lessor against Lessee, and
then, in the event of a settlement or court-ordered liquidation, Lessor has
grounds to offset the amount of such security deposit against any amounts liable
to be declared by it as receivables, whereby the modification does not change
the nature of the receivables or the possible privileges attached thereto.
<PAGE>
13
ARTICLE 13 - COMMON CHARGES OF THE BUILDING
Lessee will pay charges by paying a provision calculated quarterly, based on the
prior charges. These provisions will be deducted from the actual charges
calculated annually.
For the first year, the provision is of 52,875 FRANCS (FIFTY-TWO THOUSAND EIGHT
HUNDRED SEVENTY-FIVE FRANCS), the VAT being billed separately.
Lessee's contribution to charges will be calculated on the basis of the current
distribution of the building, i.e., 261 square meters for the lot concerned of
the general common parts of the building, out of a total of 2,061 square meters.
<PAGE>
14
It is specified that the charges correspond:
- - to all the taxes of the building, including land tax,
- - to the services rendered by Lessor related to the building as well
as condominium charges in full, not including the work referred
to in article 606 of the Civil Code,
- - to expenses for equipment, upkeep, cleaning, maintenance, repair,
refurbishing, replacements, renewal, reconstruction, monitoring,
security guards, security, bringing up to Code, improvement, even if
such work is caused by the old age of the building or unless they
concern the cases referred to in article 606 of the Civil Code,
management of the common parts, without limitation thereto,
- - to the expenses and fees of the building manager,
so that the rent received by Lessor is net and free of any expenses.
The provisions will be paid quarterly under the conditions and on the dates of
payment of the rent.
If, at the end of the quarter, the provision paid is lower than the previous
charges, Lessee pledges to reimburse, at Lessor's first request, all amounts
that become necessary to compensate the amount of the real charges.
Lessor will issue an annual statement of accounts. Consequently, it pledges to
give Lessee an exact statement of the tenant charges for the past year, sent to
Lessee within six months from the end of said year, whereby each year taken into
consideration is a calendar year.
[initials]
<PAGE>
15
This statement, after being certified by the manager of the building, will be
final both for Lessor and for Lessee.
If, at the end of the year, the provisions paid are lower than the actual
charges, Lessee pledges to reimburse, at Lessor's first request, all amounts
necessary to compensate the total amount of the actual charges. Excess amounts
paid are deducted from the provisions of the current year.
If, for any reason, Lessee must leave the premises hereunder, the amount
corresponding to the statement of provisions paid by Lessee until its departure
and the charges actually paid by Lessor until that time, will be issued ipso
jure, with deduction from the security deposit, as set forth herein.
ARTICLE 14 - PENALTY CLAUSE
Any amount owed by Lessee for charges, under the clauses and conditions hereof,
will be automatically increased by 10% if the payment is not made within 10 days
after the notice sent by Lessor either by extrajudicial act or by registered
letter, with return receipt requested.
ARTICLE 15 - OCCUPANCY INDEMNITY
In the event that, in spite of a decision establishing the application of the
cancellation clause, or the cancellation of the lease, Lessee refused to vacate
the premises, it will owe an occupancy indemnity established on the basis of the
last contractual rent plus 50% until the actual release of the leased premises.
ARTICLE 16 - RESOLUTORY CLAUSE
Should Lessee fail to pay any of the charges and comply with the conditions of
the lease or to pay on the due date even a single rent, partially or in full, or
should it fail to pay rent incidentals, the amount of the penalty clause, the
amount of the occupancy indemnity, all overdue amounts arising from a court
decision, especially by revision or renewal, including court established
interest on these additions to overdue rent, all other contractual interest,
additions to the security deposit and, in general, should it fail to pay any
amounts owed by application hereof, the lease will be cancelled ipso jure and
without any judicial formality one month after a notice to pay or a summation to
pay which remains without effect during this term, containing Lessor's
declaration of intent to use the benefit of this clause.
In all events, should Lessee refuse to leave the premises, although the lease is
cancelled ipso jure, its eviction may be ordered by simple order or referral
rendered by the President of the Court of First Instance which will be executory
provisionally based on the original judgment.
ARTICLE 18 - TOLERANCES - LOCAL USAGE
No tolerance from Lessor may create a right for Lessee or a derogation hereto.
<PAGE>
16
[initials]
<PAGE>
17
For all aspects not set forth, reference is made to the law and local usages.
ARTICLE 19 - ELECTION OF DOMICILE
For the performance hereof, the parties elect domicile, to wit:
- Lessor at its domicile or headquarters, - Lessee on the leased
premises.
Lessee pledges to inform Lessor of any change of its headquarters.
Issued in two originals,
On 13 pages and 1 addendum
In Paris, 03/31/2000
LESSEE LESSOR
[signature] [signature]
ENCLOSURES: Plans of the premises
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.80
<SEQUENCE>9
<FILENAME>c20397_ex10-82.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exh. 10.80
CREDIT LYONNAIS
DIRECTION DE MARCHE ENTREPRISES
CHAMPS ELYSEES - PARIS OUEST
INTER PARFUMS HOLDING
4 Rond Point des Champs Elysees
76008 PARIS
A l'attention de Monsieur Philippe SANTI
V/Reference
N/Reference CC/MAD Paris, le 22 Mars 2001
[GRAPHIC OF PHONE] 01.49.53.14.04
Cher Monsieur,
Je faie suite a notre entretien relatif aux demandes d'informations
financieres et bancaires emanant de votre maison-mere americaine.
Je vous prie de trouver ci-apres le detail des principaux concours dont
beneficiaient les societes inter parfums Holding, inter parfums SA et inter
parfums Grand Public aupres de notre Etablissement au 31/12/00 :
o INTER PARFUMS HOLDING:
---------------------
-Facilite de Caisse :neant.
o INTER PARFUMS SA:
----------------
-Facilite de Caisse : 4 000 KF.
-Credit de Tresorerie : 8 000 KF.
-Escompte de Creances Commerciales : 12 000 KF.
o INTER PARFUMS GRAND PUBLIC:
--------------------------
-Facilite de Caisse : 2 000 KF.
Ces differents concours ont ete consentis a duree indeterminee et sont
regis par les dispositions de la Loi Bancaire du 24 Janvier 1984.
Le renouveilement de ces concours fait l'objet d'un examen annuel par
notre Etablissement, a reception des comptes auditee de vos societes.
Esperant ainsi repondre a votre attente, je vous prie d'agreer, Cher
Monsieur, l'expression de mes sentiments les mellieurs.
/s/ Christian
-------------
Directeur Commercial
ADRESSE: 55, AVENUE DES CHAMPS ELYSEES - 75381 PARIS CEDEX 08 -
TELEX: 642 008 CREDELYS PARIS
- --------------------------------------------------------------------------------
Credit Lyonnais - S.A. su capital de 1767 470 939 - SIREN 954 509 741 - RCS Lyon
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.80.1
<SEQUENCE>10
<FILENAME>c20397_ex10-821.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exh. 10.80.1
[logo] CREDIT LYONNAIS
DEPARTMENT OF CORPORATE CONTRACTS
CHAMPS ELYSEES - PARIS WEST
INTER PARFUMS HOLDING
4, Rond-Point des Champs Elysees
76008 PARIS
Attn: Mr. Philippe SANTI
Your reference
Our reference CO/MAD
Tel. 01.49.53.14.04 Paris, March 22, 2001
Dear Sir:
I am following up on our conversation in regard to the request for
financial and banking information issued by your American parent company.
Please find below the details of the main facilities offered by our
Establishment to the companies Inter parfums Holding, Inter parfums SA, and
Inter parfums Grand Public as of 12/31/2000:
o INTER PARFUMS HOLDING:
---------------------
- Cash facility: none.
o INTER PARFUMS SA:
----------------
- Cash Facility: 4,000 KF,
- Cash Credit: 8,000 KF,
- Commercial Credit Discount: 12,000 KF.
o INTER PARFUMS GRAND PUBLIC:
--------------------------
- Cash Facility: 2,000 KF.
These various facilities were granted for an indefinite term and are
governed by the provisions of the Banking Law of January 24, 1984.
<PAGE>
The renewal of these facilities is examined annually by our
Establishment upon receipt of the audited accounts of your companies.
Hoping that we have met your expectations, we remain,
Very truly yours,
/s/ Christian Carata
---------------------
Commercial Director
ADDRESS: 55, AVENUE DES CHAMPS ELYSEES - [illegible] PARIS CEDEX 06 -
TELEX: 642 008 CREDELYS PARIS
- --------------------------------------------------------------------------------
Credit Lyonnais - Corporation with capital of 1,757,470,939 [illegible] -
SIREN 854 509 741 - RCS Lyon
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.81
<SEQUENCE>11
<FILENAME>c20397_ex10-81.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exh. 10.81
BARCLAYS
45, boulevard Haussmann - 75315 Paris Cedex 09
Telephone: 01 55 27 55 27 - Fax: 01 55 27 50 01
08 JUIN 1998
INTERPARFUMS
4, Rond Point des Champs Elysees
75008 PARIS
Business Banking France A l'attention de M. Philippe SANTI
----------------------------------
French Multinational Team
BD/EM - [GRAPHIC OF PHONE]: 01.55.27.58.27
[GRAPHIC OF NOTE]: 01.55.27.51.22
Paris, le 4 juin 1998
Messieurs,
Conformement a nos accords lors de notre dernier entretien, nous avons le
plaisir de vous confirmer le reamenagement des conditions liees aux facilites
mises a votre disposition dans nos livres.
Nous vous rappelons que nous vous avions accorde:
FACILITE DE CAISSE Montant: FRF 6.000.000,-
-------
Taux: T4M* + 0,80 %
----
ESCOMPTE COMMERCIAL Montant: FRF 9.000.000,-
-------
Taux: PIBOR** + 0,60%
----
Nous vous informons que nous appliquerons les nouvelles conditions ci-dessous a
compter du 1er juillet 1998:
FACILITE DE CAISSE Montant: FRF 6.000.000,-
-------
Taux: T4M* + 0.60%
----
ESCOMPTE COMMERCIAL Montant: FRF 9.000.000,-
-------
Taux: PIBOR** + 0.40%
----
Il est precise que les conditions d'interets ci-dessus mentionnees sont
susceptibles de revision a tout moment en fonction de l'evolution du marche de
reference.
<PAGE>
BARCLAYS
Toute modification de ce taux de reference sera applicable des sa publication
par les services competents de la Banque de France, ou Association Francaise des
Banques, ou toute autre autorite financiere notamment etrangere, selon le cas.
Le calcul du taux effectif global etant subordonne aux utilisations effectives,
il n'est possible de donner qu'un exemple de calcul a titre indicatif (exemple
ci-joint pour les credits par caisse et les credits d'escompte).
Ces facilites etant consenties pour une duree indeterminee, nous vous precisons
que l'alinea 1 de l'article 60 de la loi n(degree) 84-46 du 24 janvier 1984 nous
fait obligation de vous informer des delais de preavis que nous respecterions
dans l'eventualite de leur reduction ou de leur suppression :
- - Trente jours pour les operations d'escompte et de mobilisations de
creances commerciales,
- - Soixante jours pour les autres credits.
Ce d'elai courra de la date d'envoi par notre banque d'une lettre notifiant
notre decision d'interrompre ou de reduire les concours precites.
Cette lettre annule et remplace celle en date du ler juillet 1996 et ne vient en
aucun cas s'ajouter a celle-ci.
Nous vous prions d'agreer, Messieurs, l'expression de nos sentiments distingues.
/s/ Christine Laine /s/ Bertrand Duvivier
- ------------------- ----------------------
Analyste Senior Fonde de Pouvoirs Principal
* T4M : Taux Moyen Mensuel du Marche Monetaire
** PIBOR : Paris Interbanking Offered Rate
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.81.1
<SEQUENCE>12
<FILENAME>c20397_10-811.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exh. 10.81.1
[logo] BARCLAYS
45, boulevard Haussmann - 75315 Paris Cedex 09
Telephone: 01 55 27 55 27 Fax: 01 55 27 50 01
[stamp] JUNE 08, 1998
INTERPARFUMS
4, Rond-Point des Champs Elysees
75008 PARIS
Business Banking France Attention: Mr. Philippe SANTI
French Multinational Team
BD/EM - Tel: 01 55 27 58 27 [handwritten] Copy: PB
Fax: 01 55 27 51 22 JGL
Bach PS
Paris, June 4, 1998
Gentlemen:
In accordance with our agreement during our last meeting, we are pleased to
confirm the adjustment of the terms of the facilities available to you.
Please note that you have been granted:
LINE OF CREDIT Amount: 6,000,000.00 FRF
------
Rate: T4M* + 0.80%
----
TRADE DISCOUNT Amount: 9,000,000.00 FRF
------
Rate: PIBOR** + 0.60%
----
Please also note that the new terms, below, will be effective as of July 1st,
1998:
LINE OF CREDIT Amount: 6,000,000.00 FRF
------
Rate: T4M* + 0.60%
----
TRADE DISCOUNT Amount: 9,000,000.00 FRF
------
Rate: PIBOR** + 0.40%
----
We would like to clarify that the interest terms specified above are subject to
change at any time, in accordance with base market trends.
Barclays Bank PLC, French Branch - Headquarters: 45, boulevard Haussmann, 75009
Paris - [illegible]
<PAGE>
[logo] BARCLAYS
Any modification of this base rate is applicable upon its reporting by the
relevant departments of the Banque de France, or the Association Francaise des
Banques [French Association of Banks], or any other financial or foreign
authority, if applicable.
As calculation of the overall effective rate is subject to the effective
applications, it is possible to provide Fonly one example of calculation, for
informational purposes (example attached for cash credits and discount credits).
As these facilities are granted for an unspecified length of time, we would like
to clarify that paragraph 1 of article 60 of law no. 84-46 of January 24, 1984,
requires that we inform you of the periods of notice that we will observe in the
eventuality that these facilities are reduced or removed:
- - Thirty days for discount operations and assignment of receivables,
- - Sixty days for other credits.
This time period begins from the date the letter notifying our decision to
interrupt or to reduce the aforementioned assistance is sent.
This letter nullifies and replaces the letter dated July 1, 1996, and may in no
way be combined with it.
Very truly yours,
/s/ Christine Laine /s/ Bertrand Duvivier
- ------------------- ----------------------
Senior Analyst Senior Banking Executive
*T4M: Average Monthly Money Market Rate
**PIBOR: Paris Interbanking Offered Rate
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.82
<SEQUENCE>13
<FILENAME>c20397_ex10-80.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exhibit-10.82
BANQUE OBC - ODIER BUNGENER COURVOISIER
5 AOUT 1998
INTER PARFUMS SA
4, rond-point des Champs-Elyseesuthier
75008 PARIS
Le 31 Juillet 1998
Christine PENIN
Service Engagements
Tel : 01.45.02.44.12
Messieurs,
Nous vous confirmons que notre Comite de Credit a accepte de maintenir la ligne
d'escompte de vos creances professionnelles utilisable soit par escompte de
papier commercial, soit par mobilisation de creances professionnelles, dans les
conditions suivantes :
Montant : F. 10.000.000, o (DIX MILLIONS DE FRANCS FRANCAIS)
- --------
Conditions financieres : agios decomptes lors de l'escompte au taux du Pibor
d'usance, majore de 0,40 point, cc taux variant cn fonction du taux de
reference.
Nous vous remercions de bien vouloir marquer votre accord sur les termes de la
presente, en nous en retournant un exemplaire dument paraphe et revetu de la
mention manuscrite [[ BON POUR ACCORD ]] suivie de la signature d'une personne
accreditee.
Nous vous prions d'agreer, Messieurs, l'expression de nos sentiments distingues.
BANQUE OBC - ODIER BUNGENER COURVOISIER
/s/ Cecile Sornin /s/ Catherine Hongnat
----------------- ---------------------
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.82.1
<SEQUENCE>14
<FILENAME>c20397_ex10-801.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exh. 10.82.1
[logo]
BANQUE OBC - ODIER BUNGENER COURVOISIER [stamp] AUGUST 5, 1998
INTER PARFUMS SA
4, rond-point des Champs Elyseesuthier [sic]
75008 PARIS
July 31, 1998
Christine PENIN
Loan Department
Tel: 01 45 02 44 12
Gentlemen:
This is to confirm that our Credit Committee has agreed to keep the discount
line for your business liabilities available either through discounted bills, or
through assignment of business receivables, in accordance with the following
terms:
AMOUNT: 10,000,000.00 F (TEN MILLION FRENCH FRANCS)
FINANCIAL TERMS: agios [charges] deducted at the Pibor usance rate discount,
plus 0.40 percent; this rate varies depending on the base rate.
Please indicate your agreement to the terms of this letter by sending us a copy,
duly initialed and with the handwritten note "AGREEMENT GIVEN BY," followed by
the signature of an authorized person.
Very truly yours,
BANQUE OBC - ODIER BUNGENER COURVOISIER
/s/ Cecile Sornin /s/ Catherine Hongnat
----------------- ---------------------
[illegible letterhead]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.83
<SEQUENCE>15
<FILENAME>c20397_ex10-85.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exhibit 10.83
BANQUE OBC - ODIER BUNGENER COURVOISIER
INTER PARFUMS SA
4, rond-point des Champs-Elyseesuthier
75008 PARIS
Le 31 Juillet 1998
Christine PENIN
Service Engagements
Tel : 01.45.02.44.12
Messieurs,
Nous vous confirmons que notre Comite de Credit a accepte de maintenir la ligne
d'autorisation globale de decouvert et de spot financier, dans les conditions
suivantes :
Montant : F. 10.000.000,- (DIX MILLIONS DE FRANCS FRANCAIS)
- --------
Conditions financieres :
- -----------------------
- - pour le decouvert : agios decomptes par trimestre civil au taux moyen mensuel
du marche monetaire (actuellement 3,3771% l'an) majore de 0,60 point, ce taux
variant en fonction du taux de reference et payables a terme echu,
- - pour le spot : agios decomptes lors de l'escompte au taux du Pibor d'usance,
majore de 0.50 point, ce taux
variant en fonction du taux de reference.
Nous vous remercions de bien vouloir marquer votre accord sur les termes de la
presente, en nous en retournant un exemplaire dument paraphe et revetu de la
mention manuscrite [[BON POUR ACCORD]] suivie de la signature d'une personne
accreditee.
Nous vous prions d'agreer, Messieurs, l'expression de nos sentiments distingues.
BANQUE OBC - ODIER BUNGENER COURVOISIER
/s/ Cecile Sornin /s/ Catherine Hongnat
----------------- ---------------------
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.83.1
<SEQUENCE>16
<FILENAME>c20397_ex10-851.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exhibit 10.83.1
[logo]
BANQUE OBC - ODIER BUNGENER COURVOISIER
INTER PARFUMS SA
4, rond-point des Champs Elyseesuthier [sic]
75008 PARIS
July 31, 1998
Christine PENIN
Loan Department
Tel: 01 45 02 44 12
Gentlemen:
This is to confirm that out Credit Committee has agreed to keep the overall
authorization line for overdraft and spot, in accordance with the following
terms:
Amount: 10,000,000.00 F (TEN MILLION FRENCH FRANCS)
- ------
Financial Terms:
- ---------------
- - for overdraft: agios deducted by calendar quarter at the average
monthly money market rate (currently 3.3771% per year) plus 0.60
percent; this rate varies depending on the base rate, payable when due,
- - for spot: agios deducted at the Pibor usance rate discount, plus 0.50
percent; this rate varies depending on the base rate.
Please indicate your agreement to the terms of this letter by sending us a copy,
duly initialed and with the handwritten note "agreement given by," followed by
the signature of an authorized person.
Very truly yours,
BANQUE OBC - ODIER BUNGENER COURVOISIER
/s/ Cecile Sornin /s/ Catherine Hongnat
----------------- ---------------------
[illegible letterhead]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.84
<SEQUENCE>17
<FILENAME>c20397_ex10-84.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exhibit 10.84
BANQUE WORMS
SUCCURSALE RIVE DROITE
370, RUE SAINT-HONORE - B.P. - 75027 PARIS CEDEX 01
TEL. 01 49 07 66 00 - FAX 01 49 07 66 60 - TELEX 216 019 F / 214 122 F
Paris, le 22 decembre 1997
INTER PARFUMS
4, Rond Point des Champs Elysees
75008 PARIS
A l'attention de MM. Santi Lecleroq
-----------------------------------
Messieurs,
Vous nous avez precise avec M. Benacin vos attentes en matiere de concours
bancaires, au cours de notre entretien du 18 courant.
Nous avons bien note que vous recherchiez une ligne de 10 MF utilisable en
decouvert ou apot a T4M/PIBOR+0,625% et une ligne d'escompte commercial de 5 MF
a PIBOR+0,60%.
Comme convenu, et avant de vous etablir un cahier de conditions, je vous propose
de reprendre contact avec vous au cours de la semaine du 12 janvier afin de
savoir si notre proposition vous convient parfaitement.
Nous souhaitons etre a vos cotes pour reussir votre projet dans le respect des
valeurs qui animent votre groupe : transparence, reactivite et pragmatisme.
Nous nous tenons a votre disposition pour repondre a vos questions et vous
prions d'agreer, Messieurs, l'expression de nos salutations distinguees.
/s/ L. Pages /s/ T. Clamon
------------ -------------
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.84.1
<SEQUENCE>18
<FILENAME>c20397_ex10-841.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exhibit 10.84.1
[logo]
BANQUE WORMS
RIGHT BANK BRANCH
370, RUE SAINT-HONORE - B.P. 602 - 75027 PARIS CEDEX 01
TEL: 01 49 07 66 00 - FAX: 01 49 07 66 60 - TELEX: 216 019 F / 214 122 F
Paris, December 22, 1997
INTER PARFUMS
4, Rond-Point des Champs Elysees
75008 PARIS
Attention: Mr. Santi
---------------------------
Gentlemen:
During the course of our meeting on the 18th of this month, you explained to us,
with Mr. Benacin, your expectations regarding bank support.
We understand that you are looking for a line of 10 MF available in overdraft or
spot at T4M/PIBOR + 0.625% and a trade discount line of 5 MF at PIBOR + 0.60%.
As agreed, and before establishing terms and conditions with you, I propose that
we speak again sometime during the week of January 12, so that we may know if
our proposal is completely agreeable to you.
We would like to be able to assist you in the success of your project, as we
respect the values that motivate your group: openness, adaptability and
pragmatism.
Please do not hesitate to contact us should you have any questions.
Very truly yours,
/s/ L. Pages /s/ T. Clamon
------------ -------------
[illegible letterhead]
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.85
<SEQUENCE>19
<FILENAME>c20397_ex10-83.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exhibit 10.85
CREDIT AGRICOLE
D'ILE-DE-FRANCE
INTER PARFUMS
4, Rond-Point de Champs Elysees
75008 PARIS
N/REF : PC/PS
PARIS, le 19 juin 1996
A l'attention de Monsieur Jean-Guy LECLERO
Messieurs,
Suite a nos differents entretiens, vous trouverez, ci joint,
les lignes et conditions que nous mettons a votre disposition.
Nous vous assurons que nous apporterons le meilleur soin aux
operations que vous voudrez bien nous confier.
Nous restons a votre disposition pour tout renseignement ou
precision complementaire.
Nous vous prions d'agreer, Messieurs, l'expression de nos
sentiments distingues.
Le Responsable du Secteur
I.A.A. & Distribution
/s/ Philippe Simon
------------------
- -
Page 1 of 2
<PAGE>
- - Decouvert 5.000.000 F T4M + 1
- - Credit de tresorerie 5.000.000 F Pibor + 0,80
- - Excompte commercial 4.000.000 F Pibor + 0,60
- - M.C.N.E 6.000.000 F Pibor + 0,60
- - Change a terme 10.000.000 F
Page 2 of 2
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.85.1
<SEQUENCE>20
<FILENAME>c20397_ex10-831.txt
<DESCRIPTION>CORRESPONDENCE
<TEXT>
Exh. 10.85.1
[logo]
CREDIT AGRICOLE
D'ILE-DE-FRANCE
[illegible letterhead]
INTER PARFUMS
4, Rond-Point de Champs Elysees
75008 PARIS
Our Ref.: PC/PS
PARIS, June 19, 1996
Attention: Mr. Jean-Guy LECLERQ
Gentlemen:
Following our various conversations, please find enclosed the lines and
terms we are offering you.
We assure you that the transactions you entrust to us will be handled
with the utmost care.
Please do not hesitate to contact us should you need any further
details or information.
Very truly yours,
Manager of the
I.A.A. & Distribution Sector
/s/ Philippe Simon
------------------
REGIONAL OFFICE FOR CREDIT AGRICOLE MUTUEL DE PARIS ET
D'ILE-DE-FRANCE
[illegible]
<PAGE>
- - Overdraft 5,000,000 F T4M + 1
- - Cash credit 5,000,000 F Pibor + 0.80
- - Trade discount 4,000,000 F Pibor + 0.60
- - M.C.N.E 6,000,000 F Pibor + 0.60
- - Currency rate 10,000,000 F
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21
<SEQUENCE>21
<FILENAME>c20397_exh-21.txt
<DESCRIPTION>SUBSIDIARIES OF THE REGISTRANT
<TEXT>
LIST OF SUBSIDIARIES Exhibit 21
Name Jurisdiction
Inter Parfums Holdings, S.A. France
Inter Parfums, S.A. France
Inter Parfums Grand Public, S.A France
Inter Parfums Trademark, S.A France
Jean Philippe Fragrances, LLC(1) New York
Jean Philippe Fragrances do Brasil, Ltda.(1) Brazil
- --------
(1) A limited liability company.
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----