UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): December 15, 2004
MOVADO GROUP, INC.
(Exact name of registrant as specified in its charter)
NEW YORK 1-16497 13-2595932
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
650 FROM ROAD
PARAMUS, NJ 07652
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (201) 267-8000
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (SEE General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On December 15, 2004, MGI Luxury Group S.A ("MGI"), a
wholly-owned subsidiary of Movado Group, Inc., entered into a License Agreement
(the "License Agreement") with Hugo Boss Trademark Management GmbH & Co ("Hugo
Boss").
GRANT OF LICENSE, TERM AND TERMINATION
MGI received a worldwide exclusive license to use the
trademark "HUGO BOSS" and any other trademarks of Hugo Boss containing the names
HUGO or BOSS, in connection with the production, promotion and sale of watches
(the "Licensed Products"). MGI is permitted to assign its rights and sublicense
the trademarks to its affiliates (although MGI will remain liable after
such assignment or sublicense under the License Agreement). The term of the
license is March 21, 2005 through December 31, 2013, with an optional five-year
renewal period. The License Agreement is subject to termination by either party:
o upon a change of control of the other party, subject
to certain limitations and exceptions;
o if for two consecutive years after 2005 only
minimum royalties are paid; or
o upon material breach by the other party.
During the term of the License Agreement, MGI is not permitted
to manufacture or distribute the watches of either of two competitive brands
without the prior approval of Hugo Boss.
Hugo Boss has agreed to purchase all existing inventory of
Licensed Products from the prior licensee, and MGI is required to purchase
sufficient quantities of existing inventory to maintain a reasonable initial
inventory level. Hugo Boss may sell (including selling within the territory
covered by the license) any remaining inventory of Licensed Products not
purchased by MGI subject to certain limitations.
TERRITORY
The License Agreement is worldwide in scope and provides that
MGI shall, at a minimum, sell Licensed Products in those countries where Hugo
Boss has existing distribution for its core products, which territory includes
the UK, Germany, France, Spain, Italy, Belgium, the Netherlands, Luxembourg,
Switzerland, Austria, Japan, Hong Kong, Korea, Taiwan, the People's Republic of
China, Singapore, the United States, Canada and Mexico.
ROYALTIES
MGI is required to make quarterly royalty payments, payable in
Swiss Francs, based on a specified percentage of all net sales of Licensed
Products actually made by MGI, subject to certain specified minimums, based on
targeted levels of net sales of Licensed Products.
MARKETING, ADVERTISING AND PROMOTION
MGI is responsible for creating and placing cooperative
advertising and point of sale materials and is required to spend a specified
percentage of net sales of Licensed Products in connection with such
advertising. Hugo Boss is responsible for creating, conducting and placing all
brand advertising, marketing and promotion, towards which MGI will pay to Hugo
Boss a certain percentage of net sales of Licensed Products.
PRODUCT DESIGNS
All product designs for Licensed Products must be approved by
Hugo Boss prior to their use in the market. Hugo Boss will own all product
designs that are approved and used if those designs were not previously used by
MGI or otherwise were already in the public domain.
DISTRIBUTION CHANNELS
Licensed Products will be distributed through retailers,
department stores, outlet stores, duty free shops and certain clearance channels
(with Hugo Boss approval).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report on Form 8-K to be signed on its
behalf by the undersigned, hereunto duly authorized.
Dated: December 21, 2004
MOVADO GROUP, INC.
By: /s/ Timothy F. Michno
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Name: Timothy F. Michno
Title: General Counsel