8-K
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)
April
27, 2007
____________________________
Blue
Holdings, Inc.
(Exact
name of registrant as specified in charter)
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Nevada
(State
or other Jurisdiction of Incorporation or Organization)
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000-33297
(Commission
File Number)
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88-0450923
(IRS
Employer Identification No.)
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5804
E. Slauson Ave., Commerce, CA 90040
(Address
of Principal Executive Offices and zip code)
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(323)
725-5555
(Registrant's
telephone number,
including area code)
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(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 registrant under any of the following
provisions:
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR
240.14a-12(b))
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Safe
Harbor Statement under the Private Securities Litigation Reform Act of
1995
Information
included in this Current Report on Form 8-K may contain statements which
constitute forward-looking statements within the meaning of Section 27A of
the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934,
both as amended. Those statements include statements regarding our intent,
belief or current expectations. Prospective investors are cautioned that any
such forward-looking statements are not guarantees of future performance and
involve risks and uncertainties, and that actual results may differ materially
from those projected in the forward-looking statements. Such risks and
uncertainties include, among other things, our ability to face stiff
competition, profitably manage our business, the financial strength of our
customers, the continued acceptance of our existing and new products by our
existing and new customers, the risks of foreign manufacturing, competitive
and
economic factors in the textile and apparel markets, the availability of raw
materials, the ability to manage growth, weather-related delays, dependence
on
key personnel, general economic conditions, global manufacturing costs and
restrictions, and other risks and uncertainties that may be detailed herein,
or
from time to time in our other filings made with the Securities and Exchange
Commission.
Section
1 Registrant’s
Business and Operations
Item
1.01 Entry
Into a Material Definitive Agreement
License
Agreement with Mercier SARL
On
April
27, 2007, Antik Denim, LLC (“Antik”), a California limited liability company and
wholly-owned subsidiary of Blue Holdings, Inc., a Nevada corporation (the
“Registrant”), executed a License Agreement (the “License Agreement”) dated to
be effective as of April 18, 2007, by and between Antik and Mercier SARL, a
company formed under the laws of France (“Mercier”).
Pursuant
to the License Agreement, Antik granted an
exclusive right and license to use the “Antik Denim” trademark for the
manufacture, marketing, promotion, sale, distribution and other exploitation
of
denim
and
sportswear apparel
in
Europe.
Compensation for use of the “Antik Denim” trademark will consist of a royalty
calculated as 10% of Mercier’s net sales arising from products bearing the
“Antik Denim” trademark. The License Agreement has an initial term of twenty
(20) months, and includes four (4) one (1)-year extension options available
to
Mercier to the extent it achieves specified minimum net sales. Mercier has
agreed to guarantee payment of royalties on an identified minimum net sales
amount of $2.5 million during the initial twenty (20) month term, and on
identified minimum net sales amounts ranging from $2.5 million to $10 million
over the eligible extension terms. In connection with these minimum net sales,
the
License Agreement provides for an upfront minimum guarantee advance of $250,000
and an aggregate of minimum royalty payments of $2.5 million for the years
2009
though 2012 assuming the License Agreement is renewed at the end of
2008.
Prior
to
the negotiation and execution of the License Agreement, there was no material
relationship between the Registrant and Mercier. The License Agreement was
approved by the Board of Directors of the Registrant.
A
copy of
the License Agreement is attached as Exhibit 10.1 to this Current Report on
Form
8-K, and is incorporated herein by reference.
The
Registrant issued
a
press release announcing its entry into the License Agreement. A copy of the
press release is being furnished as Exhibit 99.1 to this report and is
incorporated herein by reference.
Amendment
No. 1 to License Agreement with North Star, LLC
On
April
27, 2007, in anticipation of Antik’s entry into the License Agreement with
Mercier, Antik executed Amendment No. 1 to License Agreement (the “Amendment”),
dated to be effective as of April 25, 2007, by and between Antik and North
Star,
LLC (“North Star”).
The
sole
purpose of the Amendment was to remove the European territory from the rights
previously granted to North Star.
Prior
to
the negotiation and execution of the original license agreement with North
Star,
there was no material relationship between the Registrant and North Star. The
Amendment was approved by the Board of Directors of the Registrant.
A
copy of
the Amendment is attached as Exhibit 10.2 to this Current Report on Form 8-K,
and is incorporated herein by reference.
License
Agreement with Max Ray, Inc.
On
May 1,
2007, Antik executed a License Agreement (the “License Agreement”) dated to be
effective as of May 1, 2007, by and between Antik and Max Ray, Inc., a
California corporation (“Max Ray”).
Pursuant
to the License Agreement, Antik granted an
exclusive right and license to use the “Antik Denim” trademark for the
manufacture, marketing, promotion, sale, distribution and other exploitation
of
small leather goods consisting of belts, handbags, small leather accessories
and
scarves in
the
United States and its territories.
Compensation for use of the “Antik Denim” trademark will consist of a royalty
calculated as 8% of Max Ray’s net sales arising from products bearing the “Antik
Denim” trademark. The License Agreement has an initial term of eighteen (18)
months, and includes four (4) one (1)-year extension options available to Max
Ray unless earlier terminated by Max Ray. Max Ray has agreed to guarantee
payment of royalties on an identified minimum net sales amount of $1.1 million
during the initial eighteen (18) month term, and on identified minimum net
sales
amounts ranging from $3 million to $10 million over the eligible extension
terms. In connection with these minimum net sales, the
License Agreement provides for an upfront minimum guarantee advance of $20,000
to be applied against the minimum guaranty for the aggregate initial term,
and
an aggregate of minimum royalty payments of $2.1 million for the years 2009
though 2012 assuming the License Agreement is renewed at the end of
2008.
Prior
to
the negotiation and execution of the License Agreement, there was no material
relationship between the Registrant and Max Ray. The License Agreement was
approved by the Board of Directors of the Registrant.
A
copy of
the License Agreement is attached as Exhibit 10.3 to this Current Report on
Form
8-K, and is incorporated herein by reference.
Section
9 Financial
Statements and Exhibits
Item
9.01 Financial
Statements and Exhibits
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Financial
statements of business acquired.
None.
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| (b) |
Pro
forma financial information.
None.
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10.1 |
License
Agreement by and between Antik Denim, LLC and Mercier
SARL.
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10.2 |
Amendment
No. 1 to License Agreement by and between Antik Denim, LLC and
North Star, LLC.
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10.3 |
License
Agreement by and between Antik Denim, LLC and Max Ray,
Inc.
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99.1 |
Press
Release issued by the Registrant on May 1,
2007.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, Blue Holdings,
Inc.
has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
Blue
Holdings, Inc.
Date:
May
2, 2007
By:
/s/
Larry
Jacobs
Larry
Jacobs
Chief
Financial Officer and Secretary
EXHIBIT
INDEX
| Exhibit
Number |
Description
of Exhibit
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| 10.1 |
License
Agreement by and between Antik Denim, LLC and Mercier
SARL.
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| 10.2 |
Amendment
No. 1 to License Agreement by and between Antik Denim, LLC and
North Star,
LLC.
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| 10.3 |
License
Agreement by and between Antik Denim, LLC and Max Ray,
Inc.
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| 99.1 |
Press
Release issued by the Registrant on May 1,
2007.
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