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U. S. 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): June 19, 1998
MODACAD, INC.
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(Exact name of small business issuer as specified in its charter)
California 33-31166 95-4145930
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(State or other jurisdiction of (Commission (IRS Employer
incorporation or organization) File Number) Identification No.)
3861 Sepulveda Blvd., Culver City 90230
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310) 751-2100
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Not Applicable
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(Former name or former address, if changed since last report)
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Item 5. Other Events
On June 19, 1998, ModaCAD, Inc. ("ModaCAD") has entered into an agreement with
Cendant Software Corporation, a subsidiary of Cendant Corporation, to publish
retail-based fashion software. This innovative software is based upon ModaCAD's
previously announced e-commerce fashion solution, which is being co-developed
with Intel Corporation. The Sierra Home division of Sierra On-Line, Inc. -- a
Cendant subsidiary -- will manage the publication and distribution of these
software titles. Additionally, Sierra Home has agreed to act as ModaCAD's
product fulfillment partner for alternative distribution channels. Specific
program functionality, alternative distribution details and complete pricing
information have not been disclosed.
ModaCAD and Sierra Home have agreed to jointly publish a 3D interactive
e-commerce shopping program. Through the use of advanced Internet push
technology, multimedia enhancements and peer-to-peer communication capabilities,
fashion lifestyle titles are designed to deliver a rich personalized shopping
experience. The first fashion lifestyle solution that Sierra Home will
distribute is focused on young female consumers between the ages of 15 - 28.
Joyce Freedman, ModaCAD's chief executive officer said, "We are thrilled to be
announcing this relationship with Sierra Home. This partnership has strategic
implications that will add significant value to both companies for years to
come. This agreement with Cendant, as well as our relationship with Sierra Home,
signifies a major step towards our goal of developing a complete product line of
e-commerce fashion titles as well as other applications that are intended to
service the broader e-commerce market."
According to Ron Stevens, Sierra Home's vice president and general manager,
"ModaCAD and Sierra Home share synergistic goals in introducing visually
compelling software not only into traditional retail channels, but also into
emerging Internet-based channels specifically related to e-commerce. We are
strongly dedicated to expanding our presence within the e-commerce marketplace
and based upon ModaCAD's unique visualization technology, we are confident that
our consumers will greatly benefit from this alliance."
As ModaCAD's product fulfillment arm, Sierra Home will be responsible for
distribution to all users of the fashion software. Sierra will also assume the
responsibilities of technical support and customer service.
Maurizio Vecchione, president and chief operating officer of ModaCAD went on to
say, "The Sierra brand symbolizes quality and years of expertise in developing
and distributing home productivity software. This endorsement will be extremely
valuable as we prepare to release our first fashion program this year. Sierra
has one of the best reputations in providing product fulfillment, technical
support and customer service to consumers which are essential ingredients to
ensuring customer satisfaction. We could not have picked a better partner for
this initiative." Sierra On-Line(R), Inc is part of Cendant Software, one of the
largest PC consumer software groups in the world, and a leader in entertainment
and educational software. Cendant Software consolidates the sales,
manufacturing, finance, accounting and management of Cendant Corporation's
software divisions, including Sierra On-Line(R) Inc., Knowledge Adventure(R),
Davidson & Associates, Inc. and Blizzard Entertainment(R). Cendant Corporation
is the result of the December 1997 merger between CUC International and HFS
Incorporated, creating a business and consumer services company focused on real
estate, travel and membership.
ModaCAD is rapidly becoming a premier developer and supplier of digital content
management technology enabling advanced product visualization for electronic
commerce. For the past 10 years it has leveraged its core, patented rendering
technology into a variety of electronic merchandising products primarily
targeted at the home design, home furnishings, apparel and industrial design
industries.
This news release contains forward-looking statements including statements
regarding the timing and composition of revenues, future operating results and
the timing of product introductions, among others. Except for historical
information, the matters discussed in this report are forward-looking statements
that are subject to certain risks and uncertainties that could cause the actual
results to differ materially from those projected. Factors that could cause
actual results to differ materially include the following: (i) the timely
completion of the development of the Company's software products, including
ModaCAD's e-commerce and consumer software and enhanced or updated versions of
the Company's electronic merchandising and CAD software products; (ii)
unforeseen technical or other obstacles in the development or production of such
software; (iii) acceptance of ModaCAD's e-commerce and consumer software by the
publisher/distributors of such software and the release and marketing plans of
the publisher/distributor; (iv) customer acceptance of ModaCAD's e-commerce and
consumer software products and updated or revised versions of the Company's
electronic merchandising and CAD software products; (v) the Company and its
publisher/distributor's ability to produce its products on a cost-effective and
timely basis; and (vi) factors not directly related to the Company, such as
competitive pressures on pricing, market conditions in general, competition,
technological progression, product obsolescence and the changing needs of
potential customers as well as the software, textile, apparel, home furnishings
and home design industries in general.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ModaCAD, INC.
Date: July 2, 1998 By: /s/ LEE FREEDMAN
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Lee Freedman
Vice President, Finance and
Chief Financial Officer
