HEARST magazines Brand Development
EXHIBIT
10.1 *
HEARST
magazines
Brand
Development
January
22, 2007
Xxxx
Xxxxx Xxxxx
Vice
President
Movado
Group, Inc.
000
Xxxx
Xxxx
Paramus,
New Jersey 07652
Attn:
Xxxxxx Xxxxxxxx, President
Attn:
Xxxxxxx X. Xxxxxx, General Counsel
Dear
Xxxxxx:
This
letter, when executed by both parties, shall further amend the License Agreement
between Hearst Magazines, a Division of Hearst Communications, Inc. (“Hearst”)
and Movado Group, Inc. (f/k/a North American Watch Corporation) (“Movado”) dated
as of January 1, 1992 and as amended thereafter (the “License Agreement”) as
follows:
1. Subject
to the terms and conditions of the License Agreement and those set forth
below,
Movado shall have eleven (11) options consecutively exercisable, each for
the
renewal of the License Agreement as hereby amended for an additional three
year
periods (“Further Option Renewal Period”). The first such Further Option Renewal
Period shall commence on January 1, 2010 and the final Further Option Renewal
Period shall conclude on December 31, 2042, unless further extended upon
written
consent of both parties. By execution hereof, Movado hereby elects to exercise
the first Further Renewal Option Period which will commence on January 1,
2010
and continue through December 31, 2012. For each option thereafter, such
option
must be exercised by notifying Hearst in writing that Movado intends to renew
the License Agreement as hereby amended at least six (6) months prior to
the
expiration of the then current period. Failure to exercise any such option
shall
terminate all succeeding options.
0000
Xxxxxxxx, 00xx
Xxxxx
New
York, NY 10019
T
000
000 0000
F
000
000 0000
xxxxxxx@xxxxxx.xxx
*
CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED FROM PAGE 2 AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION ("SEC") PURSUANT TO
RULE
24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED ("1934
ACT").
2. The
royalty payment referred to in Paragraph 5(b) of the License Agreement shall
continue to * , payable during each calendar year of each Further Option
Renewal
Period in two (2) equal installments, on February 15
and
August 15 of each such year. This royalty shall be increased each year by
a
percentage equal to any increase in the CPI from the prior year. There shall
be
no decrease in such royalty in the event of a decline in the CPI.
3. Section
5(c) shall be amended so that, in addition to the royalty provided for under
Paragraph 5(b), Movado shall pay to Hearst in each calendar year during the
Further Option Renewal Periods a royalty equal to * aggregate Net Sales Value
of
all Products sold by Movado in such calendar year over * aggregate Net Sales
Value of all Products sold by Movado in such calendar year over * aggregate
Net
Sales Value of all Products sold by Movado in such calendar year over * .
Such
additional royalties shall be paid to Hearst along with the royalty installments
payable as provided in paragraph 5(b) on February 15 and August 15 of each
year
of the Further Option Renewal Period.
4. Commencing
with the Option Renewal Period which commenced January 1, 2007, Movado agrees
to
purchase * pages of advertising per calendar year in Esquire magazine * .
During
each Further Option Renewal Period thereafter, Movado agrees to increase
its
purchase of advertising pages in Esquire magazine * , so that, by way of
example
by electing to exercise its option for the first Further Option Renewal Period
commencing on January 1, 2010, Movado agrees to purchase * advertising in
Esquire magazine during each calendar year of the first Further Option Renewal
Period. Likewise, if Movado elected to exercise its option for the second
Further Option Renewal Period commencing January 1, 2013, Movado would agree
to
purchase * advertising in Esquire magazine in each calendar year of such
Further
Option Renewal Period.
*
CONFIDENTIAL
PORTION OF THIS EXHIBIT OMITTED AND FILED SEPARATELY WITH THE SEC PURSUANT
TO
RULE
24b-2 OF THE 1934 ACT.
5. All
references in the License Agreement to the “Term” shall mean the period through
December 31, 2009 plus any applicable Further Option Renewal
Periods.
6. Effective
December 31, 1997, certain assets of The Hearst Corporation were transferred
to
Hearst Communications, Inc., a then-newly formed unit of The Hearst Corporation.
As a result of the transfer, all references to “Hearst” in the License Agreement
shall mean “Hearst Communications, Inc.” effective such transfer
date.
7. All
defined terms used and not otherwise defined herein shall have the meaning
given
them in the License Agreement.
8. Except
as
otherwise expressly modified herein, the License Agreement remains in full
force
and effect.
The
parties confirm their agreement of the foregoing by signing this letter below
where indicated.
Sincerely,
Xxxx
Xxxxx Xxxxx
ACCEPTED
AND AGREED:
Movado
Group, Inc.
By:
/s/
Xxxxxxx X. Xxxxxx
Title:
General Counsel
Date:
2/15/07
