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): August 25, 2021
| MOVADO GROUP, INC. |
| (Exact name of registrant as specified in its charter) |
| New York | 1-16497 | 13-2595932 |
|
(State or other jurisdiction
of incorporation) |
(Commission
File Number) |
(I.R.S. Employer
Identification No.) |
|
650 FROM ROAD, SUITE 375 PARAMUS, NJ 07652-3556 |
| (Address of principal executive offices) (Zip Code) |
| (201) 267-8000 |
| (Registrant’s Telephone Number, Including Area Code) |
| 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)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) |
Name of each exchange on which registered |
||
| Common stock, par value $0.01 per share | MOV | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01. | Entry into a Material Definitive Agreement. |
On August 25, 2021, Movado Group, Inc. (the “Company”) and Swissam Products Limited, a wholly owned Hong Kong subsidiary of the Company, entered into the Second Amendment (the “Amendment”) to the Amended and Restated License Agreement dated January 13, 2015 (as previously amended, the “Existing License Agreement”) with Tapestry, Inc. (f/k/a Coach, Inc.). The Amendment amends the Existing License Agreement by (1) revising the pricing for sales of licensed products to retail outlets controlled by Tapestry, Inc. and (2) revising the sales minima, including by combining the separate U.S. and international sales minima for each year into a single annual minimum.
The other material provisions of the Existing License Agreement remain substantially unchanged.
The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, which is filed as Exhibit 10.1 hereto and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |
| 10.1* | Second Amendment to Amended and Restated License Agreement with Tapestry, Inc. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* Certain portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The Company agrees to furnish supplementally an unredacted copy of the exhibit to the Securities and Exchange Commission upon its request.
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: August 31, 2021
| MOVADO GROUP, INC. | |||
| By: | /s/ Mitchell Sussis | ||
| Name: | Mitchell Sussis | ||
| Title: | Senior Vice President, General Counsel and Secretary | ||
EXHIBIT 10.1
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH NOT MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED. [***] INDICATES THAT INFORMATION HAS BEEN REDACTED.
SECOND AMENDMENT TO AMENDED AND RESTATED LICENSE AGREEMENT
Reference is made to the Amended and Restated License Agreement dated January 13, 2015 between Tapestry, Inc. (“Licensor”) and Movado Group, Inc. and Swissam Products Limited (collectively “Licensee”), and to the First Amendment dated January 6, 2020 (collectively, the “License Agreement”). This second amendment to the License Agreement (the “Second Amendment”) is effective as of the earliest date that each of the Parties has executed this Second Amendment (the “Second Amendment Effective Date”). The term “Parties” collectively refers to Licensor and Licensee.
Except as otherwise defined, all capitalized terms used in this Second Amendment have the meaning ascribed to them in the License Agreement. From and after the Second Amendment Effective date, references in the License Agreement and this Second Amendment refer to the License Agreement as modified by the terms of this Second Amendment, unless otherwise specified.
WHEREAS, the Parties desire to amend the terms of the License Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties agree as follows:
| 1. | Defined Terms. From and after the Second Amendment Effective Date, Section 1.7 of the License Agreement is deleted in its entirety and replaced with the following: |
1.7 “Licensor Price” shall mean, subject to Section 8.2: (1) [***] percent ([***]%) of Licensee’s suggested U.S. retail price for Licensed Products not made exclusively for sale in factory outlet stores, and (2) [***] percent ([***]%) of the target price mutually agreed upon by Licensor and Licensee for Licensed Products made exclusively for sale in factory outlet stores. The Parties shall review and agree upon the target prices for Licensed Products made exclusively for sale in factory outlet stores seasonally in connection with each development schedule. [***]
| 2. | Sales Targets and Minimums. From and after the Second Amendment Effective Date, Section 0.1 is amended to incorporate the following Terms: |
10.1 The Parties have established the following minimums pertaining to Licensee’s sales of Licensed Products to Non-Licensor Channels:
| 1 |
| Contract Year | Minimum Non-Licensor Channel Sales | |
| FY 2021 | $[***] | |
| FY 2022 | $[***] | |
| FY 2023 | $[***] | |
| FY 2024 | $[***] | |
| FY 2025 | $[***] |
| 3. | Term and Termination. From and after the Second Amendment Effective Date, Section 14.3(h) of the License Agreement is deleted in its entirety and replaced with the following: |
14.3(h)(1) Intentionally Omitted.
14.3(h)(2) Intentionally Omitted.
14.3(h)(3) If in any [***] Contract Years Licensee’s sales of Licensed Merchandise to Non-Licensor Channels fails to equal or exceed [***]% of Licensee’s Minimum Non-Licensor Channel Sales set forth in Section 10.1 as amended. Notwithstanding the foregoing, provided that Licensee satisfies its obligations pursuant to Section 11.5 of the Agreement to pay Licensor the full amount of minimum royalties due in any Contract Year, Licensee’s failure to satisfy its obligations under this Section 14(3)(h)(3) with respect to Non-Licensor Channel Sales shall not be considered an event of default.
| 4. | Except as expressly modified by this Second Amendment, all terms and conditions of the License Agreement are incorporated by reference and remain in full force and effect. |
| 5. | This Second Amendment may be executed in electronic counterparts, each of which is deemed to be an executed original even if all signatures do not appear on the same counterpart. The Parties may sign and deliver this Second Amendment via electronic transmission (via DocuSign or PDF), and agree that delivery by DocuSign/PDF is as legally binding as if physically signed in writing and has, for all purposes, the same force and effect as delivery of original signatures. No certification or authority or other third party verification is necessary to validate an electronic signature; however, at the request of any party, the Parties will confirm such electronic transmission by signing a duplicate original document. |
| 6. | This Second Amendment is governed by, and construed in accordance with, the law of the State of New York applicable to contracts made and to be performed in the State of New York, without regard to conflicts of law principles. |
| 2 |
| 7. | In the event one or more provisions of this Second Amendment is held invalid, illegal, or unenforceable by any court of competent jurisdiction, such holding shall not affect any other provisions of this Second Amendment, which shall be construed as if such invalid, illegal, or unenforceable provision had not been included. |
(Signature page to follow)
| 3 |
IN WITNESS WHEREOF, the Parties have caused their respective duly authorized officers to execute this Second Amendment as of the dates set forth below.
| TAPESTRY, INC. | MOVADO GROUP, INC. | ||||
| By: | /s/ Todd Kahn | By: | /s/ Mitchell Sussis | ||
| Print: | Todd Kahn | Print: | Mitchell Sussis | ||
| Title: | CEO and Brand President, Coach | Title: | Senior VP | ||
| Date: | August 25, 2021 | Date: | August 24, 2021 | ||
| SWISSAM PRODUCTS LIMITED | |||||
| By: | /s/ Mitchell Sussis | ||||
| Print: | Mitchell Sussis | ||||
| Title: | Director | ||||
| Date: | August 24, 2021 | ||||
| 4 |