Document:

AGREEMENT_10_2

Exhibit 10.2

Agreement Relating to Indemnification and Clawback Rights, and Release

This Agreement Relating to Indemnification and Clawback Rights, and Release ("Agreement") is made and entered into this February 6th, 2012 (the “Effective Date”) by and between The Spectranetics Corporation (“Spectranetics”) and Trung Pham (“Pham”).  

1.    Definitions.  

“Appeal,” when used as a noun, means any challenge to any decision or verdict made by the Trial Court or the jury empanelled by the Trial Court, where such challenge is made in a court other than the Trial Court.  When used as a verb, it means the process of undertaking an Appeal.

“Appellate Court” means a court that hears an Appeal.

“Case” means U.S. v. George John Schulte, et al., case number 10-CR-0045-WYD, to the extent of the charges contained in the Second Superseding Indictment dated May 5, 2011.

“Charter Documents” means the Certificate of Incorporation and Bylaws of Spectranetics.

“Clawback Rights” means the rights of Spectranetics to recover Legal Fees and Expenses advanced to or on behalf of Pham commencing with the date that the Federal Investigation started, in the event that the verdict or findings at the Trial would result in Pham’s being required to repay amounts, whether those rights arise under the DGCL, the Charter Documents, or the Undertaking.

“DGCL” means the Delaware General Corporation Law.
 
“Federal Investigation” means: the investigations initiated by the United States government on or after September 4, 2008, including, but not limited to investigations and proceedings of or brought by the U.S. Food and Drug Administration, the U.S. Immigration and Customs Enforcement, and/or the U.S. Department of Justice.

“Indemnification Rights” means Pham’s right to advancement of expenses and indemnification pursuant to the DGCL, the Charter Documents and/or the Undertaking.

“Legal Fees and Expenses” means: (i) fees paid or to be paid to attorneys for their time in investigating, preparing to defend, or defending the Federal Investigation, paid or to be paid by Spectranetics to or on behalf of Pham; and (ii) expenses for investigating, preparing to defend, and defending the Federal Investigation, that were paid or to be paid by Spectranetics to or on behalf of Pham.  

“New Trial” means legal proceedings in the Trial Court relating to the Case that take place as a result of the Trial being declared a mistrial, or as a result of an Appeal that is Successful. 

“Successful” means a ruling by an Appellate Court which results in an over-ruling of a decision by the Trial Court and an order for a new trial.

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“Trial” means legal proceedings that take place in the Trial Court relating to the Case on or after January 1, 2012, including pre-trial motions, the trial, motions during the trial, sentencing, and any briefing relating to those activities, but specifically excluding any New Trial or any legal action relating to the Case that takes place in or is directed to a court other than the Trial Court, including but not limited to any Appeal.

“Trial Court” means the United States District Court for the District of Colorado. 

“Undertaking” means the Affirmation and Undertaking for Advancement of Expenses Pursuant to Delaware General Corporation Law §145(e) and the Bylaws of The Spectranetics Corporation signed by Pham and dated October 17, 2008. 

2.    Clawback Rights and Indemnification Rights.  Except as specifically provided in this Agreement, Spectranetics will have no further Clawback Rights regarding Legal Fees and Expenses under the DGCL, the Charter Documents and/or the Undertaking.  Except as specifically provided in this Agreement, Pham will have no further Indemnification Rights under the DGCL, the Charter Documents and/or the Undertaking.  

3.    Payments.  

a.    Spectranetics will reimburse Pham an amount not to exceed $525,000 for his Legal Fees and Expenses that are incurred on or after January 1, 2012 solely for the Trial and any Appeal that is not Successful.  For purposes of calculating amounts paid by Spectranetics on behalf of Pham, the following rules will apply for people and entities retained by Pham and a co-defendant:  1⁄2 of the actual cost for a court reporter and transcripts; 1⁄2 of the actual cost of one person to do computer work; 1⁄2 of the actual cost of a jury consultant; 1⁄2 of the actual cost of expert witnesses; and 1/3 of the actual cost of computer data storage by Iris.  Spectranetics will pay the enumerated expenses in full, but only the fractions listed will be applied for purposes of the dollar cap in the first sentence of this subsection.

b.    Spectranetics will reimburse Pham an amount not to exceed a total of $400,000 for his Legal Fees and Expenses that are incurred for any and all: (i) Appeals that are Successful and/or; (ii) New Trials.  

c.    Spectranetics will advance $200,000 (the “Advance Amount”) of the amount permitted under subsection (a) within 10 days of the Effective Date.  The remainder of the amounts that may come due under this Agreement will be paid as follows:  Pham will deliver copies of his attorney’s bills and receipts for Legal Fees and Expenses covered under subsections (a) and (b) to Spectranetics.  Once Pham has presented bills and receipts totaling the Advance Amount, Spectranetics will pay Pham (or his attorneys) the amounts of Legal Fees and Expenses shown on that documentation that is over the Advance Amount within 30 days of receipt up to the total amount noted in subsections (a) and/or (b) as applicable.

4.    Release.  

a.    Pham releases, acquits and forever discharges Spectranetics from any and all actions, causes of action, suits, claims, demands, rights, controversies, debts, agreements, damages, costs, expenses, liabilities and compensation whatsoever (collectively, “Claims”) that Pham now has or may hereafter have against Spectranetics on account of or arising out of any matter, thing, or event which has happened, developed or occurred, whether known or unknown, at any time prior to the Effective Date.  

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b.    Spectranetics releases, acquits and forever discharges Pham from any and all Claims that Spectranetics now has or may hereafter have against Pham on account of or arising out of any matter, thing, or event which has happened, developed or occurred, whether known or unknown, at any time prior to the Effective Date.  

c.    Pham and Spectranetics do not release each other from any Claims arising out of the breach or alleged breach of this Agreement.

5.    Unknown Facts.  Pham and Spectranetics acknowledge that they are aware that they or their attorneys may later discover facts different from or in addition to the facts which they now know or believe to be true with respect to the subject matter of this Agreement, but that it is their intention to, and they do, fully, finally, absolutely, and forever settle any and all claims, disputes and differences which do now exist, may exist, or may have existed between them as set forth herein and that in furtherance of such intention, the mutual general release given above shall be, and remain, in effect as a full and complete mutual and general release, notwithstanding any mistake of fact or the discovery of any different or additional facts.

6.    Miscellaneous.  

a.    Successors and Assigns.  The provisions of this Agreement will be deemed to bind, obligate and extend to, and inure to the benefit of the parties’ successors and assigns.

b.    Entire Agreement and Amendment.  This Agreement contains the entire agreement and understanding between Spectranetics and Pham and supersedes and replaces all prior negotiations or proposed agreements, written or oral relating to its subject matter.  Neither of the parties has entered into this Agreement in reliance upon any promise, representation or warranty not contained in this Agreement.  Each party has fully and carefully read the foregoing Agreement, knows and understands its contents, has had the advice of legal counsel, and signs it freely.  This Agreement may be amended only by a writing signed by both Spectranetics and Pham.

c.    Method of Signing.  This Agreement may be executed electronically and in two or more counterparts, each of which will be deemed an original and all together will constitute one and the same instrument.

d.    Notices.  Any notice, request, instruction or other document to be given under this Agreement will be in writing and will be delivered personally or sent by a reputable overnight courier to the addresses shown on the signature page or to another address that is provided by notice under this subsection.

The remainder of this page is intentionally left blank.

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Signature page to Agreement Relating to Indemnification and Clawback Rights, and Release

	
		
	The Spectranetics Corporation

By:     /s/ Roger Wertheimer                    

9965 Federal Drive
Colorado Springs, CO 80921-3617
	

/s/ Trung Pham                        
Trung Pham

Address for Notices:                    

	 
	 

	Approved by:
	 

	

/s/ Michele Berdinis Fagin                        
Michele Berdinis Fagin
Sparks Willson Borges Brandt & Johnson, P.C. 
24 S. Weber Street, Suite 400
Colorado Springs, CO 80903

Outside counsel to The Spectranetics Corporation
	

/s/ Fredric M. Winocur                        
Fredric M. Winocur
Ridley McGreevy & Winocur
303 16th Street Suite 200
Denver, CO 80202

Counsel to Trung Pham

4Ex 4.1 Amendment to Warrant Certificates

Exhibit 4.1
AMENDMENT TO WARRANT CERTIFICATES

AMENDMENT TO WARRANT CERTIFICATES, dated as of December 23, 2011 (this “Warrant Amendment”) by and among the persons whose names appear on the signature pages hereto (each a “Required Holder” and together, the “Required Holders”), and Parlux Fragrances, Inc., a Delaware corporation (the “Company”).  
WHEREAS, the Company has issued warrants to purchase 6,000,000 shares of the common stock, $.01 par value, of the Company to the persons identified on Schedule A (the “Holders”) attached hereto (collectively, the “Licensor Warrants”) pursuant to that certain Agreement dated April 3, 2009 (the “Agreement”) by and between the Company and Artistic Brands Development, LLC (f/k/a Iconic Fragrances, LLC) (“Licensor”) and subject to the terms and conditions of that certain Letter Agreement dated April 3, 2009 by and among the Company, Licensor and Rene Garcia (as amended, the “Letter Agreement”);  

WHEREAS, the Required Holders hold Licensor Warrants exercisable for a majority of the common stock issuable under all of the Licensor Warrants;
WHEREAS, the Licensor Warrants provide that all of the Holders of the Licensor Warrants (each, a “Holder” and collectively, the “Holders”) have certain rights upon the occurrence of a merger of the Company with and into another entity;
WHEREAS, concurrently with the execution of this Warrant Amendment, the Company is entering into an Agreement and Plan of Merger (the “Merger Agreement”) with Perfumania Holdings, Inc. (“Parent”) and a wholly-owned subsidiary of Parent (“Merger Sub”), pursuant to which, among other things, (i) the Company will merge with and into Merger Sub (the “Merger”), and (ii) except as otherwise provided in the Merger Agreement, each outstanding share of the common stock of the Company, $.01 par value per share will be converted into the right to receive the consideration set forth in the Merger Agreement; and
WHEREAS, in connection with the Merger, the Company and the Required Holders have agreed to certain amendments to the Licensor Warrants and certain other agreements, as set forth herein.
NOW, THEREFORE, pursuant to Section 9.3 of each of the Licensor Warrants and in consideration of the premises and mutual covenants contained herein, the parties hereto hereby agree as follows:  
1.Definitions.  Capitalized terms used and not otherwise defined in this Warrant Amendment shall have the meanings assigned to such terms in the Licensor Warrants.  

2.Lawful and Adequate Consideration; Alternate Consideration; Other Amendments.  Subject to the provisions of Section 2.10 of the Merger Agreement and Section 5 below:

(a)notwithstanding anything to the contrary contained in the Licensor Warrants, the Agreement or the Letter Agreement, at the Effective Time (as defined in the Merger Agreement), in accordance with Section 2.8(b)(ii) of the Merger Agreement, each outstanding and unexercised Licensor Warrant will cease to represent a warrant to purchase Common Stock and will be converted automatically into a fully-vested warrant (a “Parent Warrant”) to purchase a number of shares of Parent Common Stock (as defined in the Merger Agreement) equal to the product (rounded down to 

the nearest whole share) of (x) the number of shares of Common Stock subject to such Licensor Warrant and (y) the Exchange Ratio (as defined in the Merger Agreement), at an exercise price per share of Parent Common Stock equal to $8.00 (the “Licensor Warrant Consideration”);

(b)the aggregate Licensor Warrant Consideration payable to the Holders pursuant to this Warrant Amendment shall be deemed, for purposes of Section 2.5 of each Licensor Warrant, to be lawful and adequate and in full satisfaction of the requirement to provide Alternate Consideration;

(c)notwithstanding anything to the contrary contained in the Licensor Warrants, the Agreement or the Letter Agreement, at the Effective Time the vesting schedule contemplated by Section 1.1(a) of each Licensor Warrant converted into a Parent Warrant shall immediately accelerate such that each such Parent Warrant shall be fully exercisable from and after the Effective Time through the end of the applicable Exercise Period with respect to such converted Licensor Warrant; 

(d)Section 3.3 of the Licensor Warrants shall be amended by:
(i)  changing all references to 19.9% in subsection (a) thereof to 28%; and 
(ii)deleting subsection (b) thereof;

(e)Section 9.2 of the Licensor Warrants shall be amended by replacing “20% or more” with “more than 28%”;

(f)except as set forth herein, each Parent Warrant shall otherwise continued to be governed by the same terms and conditions as were applicable to the Licensor Warrant that converted into such Parent Warrant immediately prior to the Effective Time; and

(g)following the Closing Date, at a Holder's request, Parent shall promptly issue to the Holder a new warrant consistent with the foregoing provisions of this Paragraph 2 and evidencing the Holder's right to purchase the shares of Parent Common Stock issuable upon exercise of the Holder's Parent Warrants (it being understood that references in such new warrant to “the Company” shall be references to Parent).

3.Registration Rights.  Subject to the provisions of Section 5 below, Section 7.1 of the Licensor Warrants shall be deleted in its entirety and replaced with the following:

Section 7.1 Automatic Registration.  As promptly as reasonably possible (but in any event no longer than ten days) following the filing of the Annual Report of Perfumania Holdings, Inc. (“Parent”) on Form 10-K containing audited year-end financial statements as of and for the fiscal year ending on January 29, 2012, and the issuance of any other financial statements or pro forma financial information then required by the rules of the Securities and Exchange Commission (the “Commission”) to be filed with a registration statement under the Securities Act, Parent shall prepare and file with the Commission a registration statement on Form S-3 for an offering to be made on a continuous basis pursuant to Rule 415 under the Securities Act (except if Parent is not then eligible to register for resale the Warrant Shares and the shares of Common Stock of the Parent issued pursuant to a letter agreement dated as of December [ ], 2011 among the Company, Parent, Licensor and Rene Garcia (the “Licensor Shares”) on Form S-3, the registration shall be on another appropriate form) and such other documents, as may be necessary, in the opinion of counsel for Parent, so as to permit a public offering and sale by the Holder of all of the Warrant Shares and by the Licensor (or its designee) of all of the Licensor Shares under the Securities Act, unless all of the Warrant Shares and 

Licensor Shares may be sold free of volume restrictions pursuant to Rule 144 promulgated under the Securities Act (“Rule 144”).  With respect to any registration statement filed pursuant to this Section 7.1 or Section 7.2 below, Parent shall (a) use its commercially reasonable efforts to cause the registration statement to be declared effective under the Securities Act as promptly as reasonably possible after the filing thereof, (b) use its commercially reasonable efforts to keep the registration statement continuously effective under the Securities Act (including the filing of any necessary amendments, post-effective amendments and supplements) until the earlier of (i) such time as all Warrant Shares and Licensor Shares to be sold pursuant to the registration statement have been sold and (ii) the date on which all Warrant Shares and Licensor Shares may be sold without registration and without being subject to the volume limitations of Rule 144, (c) take all reasonable efforts to cause the Warrant Shares and Licensor Shares at all times during such period to be freely tradable under the registration statement, except as may be required under the federal securities laws, (d) not less than two business days prior to the filing of any registration statement or related prospectus or any amendment or supplement thereto, furnish to the Holder the sections of such documents that relate to the Holder, as proposed to be filed, which documents shall be subject to the review of the Holder, (e) promptly notify the Holder via facsimile of the effectiveness of such registration statement and the filing of any prospectus supplement or amendment to such registration statement, and (f) no later than one business day following the effectiveness of such registration statement, file with the Commission a final prospectus in accordance with Rule 424 under the Securities Act with respect to such registration statement.  Anything contained herein to the contrary notwithstanding, the Parent covenants and agrees that it shall use its best efforts to cause such registration statement to be effective no later than six months following the issuance date of this Warrant.
4.Resale of Parent Common Stock.  Subject to the provisions of Section 5 below, Section 3 of the Licensor Warrants shall be amended by inserting the following new Section 3.4 at the end thereof:

3.4    Resale of Parent Common Stock.  Holder shall not publicly sell any Warrant Shares acquired upon exercise hereof prior to the date occurring one hundred twenty (120) days after the Effective Time of the Merger (as both terms are defined in the Merger Agreement).
5.Effectiveness; Termination of Merger Agreement.  The provisions of Paragraphs 2, 3 and 4 above shall be effective if but only if the Merger is consummated in accordance with the terms of the Merger Agreement (a) as in effect on the date hereof or (b) as amended following the date hereof; provided that such amendments shall not (i) adversely affect any of the principal rights and benefits of the Holders intended hereby, (ii) affect the Merger Consideration or the Exchange Ratio (each as defined in the Merger Agreement), (iii) affect any Holder adversely and disproportionately to any other Holder without the former Holder's written consent, or (iv) adversely affect any of the other rights and benefits afforded the Holders hereunder other than in an immaterial and de minimis respect.  This Warrant Amendment shall automatically terminate and be of no further force or effect in the event the Merger Agreement is terminated in accordance with the terms thereof.

6.Authorization.  The Company expressly acknowledges and agrees that the execution of this agreement by the Required Holders is not, and shall not be deemed to be, a representation or warranty as to the power and authority, express or implied, of all of, or any of, the Required Holders to amend all of the Licensor Warrants pursuant hereto and thereto. Nevertheless, the Company covenants and agrees that the modification to the Licensor Warrants contained herein shall apply to the Holders of 

all Licensor Warrants, whether or not a Holder is a party or signatory to this agreement; provided, however, that if a Holder that is not a party or signatory to this agreement hereinafter notifies the Company in writing that such Holder does not wish the modification to the Licensor Warrants contained herein to apply to any Licensor Warrants held by such Holder, then the modification to the Licensor Warrants contained herein shall not apply to such Licensor Warrants held by such Holder.

7.Full Force and Effect.  Except as amended hereby, the Licensor Warrants shall remain in full force and effect in accordance with their original terms.

8.Governing Law.  This Warrant Amendment shall be construed in accordance with and governed by the internal laws (without regard to the conflict of laws provisions) of the State of Delaware. 

9.Counterparts.  This Warrant Amendment may be executed in one or more counterparts, all of which shall be considered one and the same agreement and each of which shall be deemed an original. 

[Signature page follows.]

IN WITNESS WHEREOF, the parties hereto have caused this Warrant Amendment to be duly executed as of the day and year first above written.

	
		
	PARLUX FRAGRANCES, INC.

	By:
	/s/ Frederick Purches

	 
	Name: Frederick Purches

	 
	Title: Chairman and Chief Executive Officer

[Signature Page to Amendment to Warrant Certificates]

REQUIRED HOLDERS:
	
		
	JACQUELINE MARIE GARCIA 2006 FAMILY TRUST

	By:
	/s/ Carolina Marie Garcia

	 
	Name: Carolina Marie Garcia

	 
	Title: Co-Trustee

	
		
	CAROLINA MARIE GARCIA 2006 FAMILY TRUST

	By:
	/s/ Carolina Marie Garcia

	 
	Name: Carolina Marie Garcia

	 
	Title: Co-Trustee

	
		
	IRREVOCABLE TRUST FOR VICTOR GARCIA

	By:
	/s/ Carolina Marie Garcia

	 
	Name: Carolina Marie Garcia

	 
	Title: Co-Trustee

_/s/ Shawn C. Carter________
SHAWN C. CARTER
	
		
	Marcy fragrance trading co. llc

	By:
	/s/ Shawn C. Carter

	 
	Name: Shawn C. Carter

	 
	Title: Manager

Accepted and agreed to as of the date first above written
	
		
	PERFUMANIA HOLDINGS, INC.

	By:
	/s/ Michael W. Katz

	 
	Name: Michael W. Katz

	 
	Title: President and Chief Executive Officer

[Signature Page to Amendment to Warrant Certificates]

SCHEDULE A
LICENSOR WARRANTS

Guillermo J. Socarras
Alex Pirez
Carolina Marie Garica 2006 Family
Jacqueline Marie Garica 2006 Family
Irrevocable Trust for Victor Garica
Alfred R. Paliani
Live Nation Worldwide, Inc.
Shawn Carter
John Meneilly
Laurence Brown (a/k/a Jay Brown)
Tyran Smith
Juan Perez
Combermere Entertainment
Guillermo J. Socarras
Alex Pirez
Carolina Marie Garica 2006 Family
Jacqueline Marie Garica 2006 Family
Irrevocable Trust for Victor Garica
Alfred R. Paliani
Marcy Fragrance Trading Co. LLC
Guillermo J. Socarras
Alex Pirez
Carolina Marie Garica 2006 Family
Jacqueline Marie Garica 2006 Family
Irrevocable Trust for Victor Garica
Alfred R. Paliani
Live Nation Worldwide, Inc.
Shawn Carter
John Meneilly
Laurence Brown (a/k/a Jay Brown)
Tyran Smith
Juan Perez
Mascotte Holdings, Inc.
Guillermo J. Socarras
Alex Pirez
Carolina Marie Garica 2006 Family
Jacqueline Marie Garica 2006 Family
Irrevocable Trust for Victor Garica
Alfred R. Paliani
Marcy Fragrance Trading Co. LLC

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