License Agreement [Amendment No. 4] - Koss Corp. and Jiangsu Electronics Industries Ltd.
FOURTH AMENDMENT TO LICENSE AGREEMENT
THIS FOURTH AMENDMENT TO LICENSE AGREEMENT ("Fourth Amendment") made
and entered into this 29 day of May, 1998, by and between KOSS CORPORATION, a
Delaware corporation ("LICENSOR"), and JIANGSU ELECTRONICS INDUSTRIES LIMITED, a
British Virgin Islands company ("LICENSEE").
WITNESSETH:
WHEREAS, LICENSOR and LICENSEE (by way of assignment) are parties to a
certain License Agreement dated November 15, 1991, as amended by Amendment to
License Agreement dated November 15, 1991, a Second Amendment to License
Agreement dated September 29, 1995 and a Third Amendment and Assignment of
License Agreement dated March 31, 1997 (as amended, the "License Agreement"):
and
WHEREAS, the parties now desire to further amend certain terms and
provisions of the License Agreement as hereinafter provided.
NOW, THEREFORE, the parties hereby agree as follows:
1. Section 10 of the Third Amendment and Assignment of License
Agreement dated March 31, 1997, is hereby amended to provide that LICENSEE shall
pay to LICENSOR the following Minimum Royalties for the Contract Years set forth
below:
Year Minimum Royalties
---- -----------------
1998 $750,000
1999 $800,000
2000 $850,000
2. Section 1.2 of the License Agreement dated November 15, 1991, is
hereby deleted in its entirety and the following inserted in its place:
1.2 "Products" mean the consumer electronic products of LICENSEE set
forth on Exhibit B attached hereto; provided, however, that, except as
provided in the immediately following sentence, any such consumer
electronic products set forth on Exhibit B which have not been sold by
LICENSEE in the Territory (as defined in the first sentence of Section
1.4, as amended pursuant to this Fourth Amendment), bearing any of the
Licensed Trademarks, by December 31, 1998, shall be deleted from
Exhibit B as of January 1, 1999, and as of that date, such products
shall not be considered to be part of the Products. Notwithstanding the
immediately preceding sentence, such products, which otherwise would be
so deleted if not for the following exception ("otherwise-deleted
products"), shall not
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be deleted with respect to only the United States, Canada and Mexico
until January 1, 2000, and then only with respect to those
otherwise-deleted products which have not been sold by LICENSEE in the
United States, Canada or Mexico, bearing any of the Licensed
Trademarks, by December 31, 1999. A sale for the purpose of this
Section 1.2 shall be a sale in the normal course of business, and not
merely to preserve any rights under the License Agreement. Minimum
Royalties shall not be affected by the deletion of any products from
the Products. Notwithstanding any other provisions of, and without
diminishing LICENSEE's obligations under, the License Agreement,
LICENSOR, after December 31, 1998, shall have no obligations to
LICENSEE with respect to either products deleted from the Products as
of January 1, 1999, or otherwise-deleted products whether or not
eventually deleted, including without limitation, the indemnification
obligations under Section 11.1, the royalty-reimbursement obligations
under Section 10.1, the minimum-royalty-reduction obligations under
Section 10.1, and the obligations to obtain or maintain trademark
applications or registrations.
3. Section 1.4 of the License Agreement dated November 15, 1991, is
hereby deleted in its entirety and the following inserted in its place:
1.4 Without limiting Seller's rights under Section 6 of the Third
Amendment and Assignment of License Agreement dated March 31, 1997,
"Territory" means the United States of America, Puerto Rico, Canada,
Mexico, Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica,
Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Jamaica,
Nicaragua, Panama, Paraguay, Peru, Trinidad & Tobago, Uruguay and
Venezuela. With the written consent of LICENSOR, which consent shall
not be unreasonably withheld or delayed, the Territory may be expanded
to include the jurisdictions of Aruba, Bermuda, Cuba, French Guiana,
Grenada, Guyana, Haiti, Surinam and/or other jurisdictions in the
Territory as defined prior to this Fourth Amendment. Except as
otherwise indicated in the License Agreement, all licensed use of the
Licensed Trademarks in such expanded jurisdictions shall be subject to
the same terms and conditions as if such expanded jurisdictions were
included in the Territory as defined in the first sentence of this
Section 1.4. Except as otherwise provided in the License Agreement,
after providing written consent, LICENSOR shall promptly cause the
appropriate trademark applications to be filed in any such expanded
jurisdictions, and all costs associated with the preparation, filing,
prosecution, registration and maintenance of such applications and
resulting registrations shall be paid by LICENSOR; provided, however
that LICENSEE shall reimburse LICENSOR for a portion of such costs in
any such expanded jurisdiction in which Royalties paid by LICENSEE to
LICENSOR for sales of the Licensed Products in such expanded
jurisdiction either prior to termination of this License Agreement or
within the first three full calendar years following such consent,
whichever comes first, do not exceed U.S. $12,000 in the same such
expanded jurisdiction. The portion to be reimbursed by LICENSEE in each
such expanded jurisdiction shall be the
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difference between U.S. $12,000 and the amount of Royalties paid by
LICENSEE to LICENSOR for sales of the Licensed Products in each such
expanded jurisdiction either prior to termination of the License
Agreement or within the first three full calendar years following
consent, whichever comes first.
4. Section 8.5 of the License Agreement dated November 15, 1991, and
Sections 16(r) and 21 of the Third Amendment and Assignment of License Agreement
dated March 31, 1997, are hereby deleted in their entirety, and the following
inserted in their place:
21. This License Agreement shall be governed by the substantive laws of
the State of Wisconsin (regardless of laws that might be applicable
under principles of conflicts of laws) as to all matters, including but
not limited to matters of validity, construction, effect and
performance. Resolution of any and all disputes between LICENSOR and
LICENSEE arising from or in connection with this License Agreement,
whether based on contract, tort, common law, equity, statute,
regulation, order or otherwise, shall be governed by and settled in
accordance with binding arbitration; provided, however, that the three
arbitrators selected shall each have extensive knowledge in the area of
federal trademark law. If the parties cannot agree on the selection of
three arbitrators, each party shall select one arbitrator, and those
two arbitrators together shall select the third arbitrator, and the
three arbitrators, each of which shall have extensive knowledge in the
area of federal trademark law, shall resolve the dispute as provided
herein. The arbitrators' findings and decisions shall be limited to the
subject matter of the dispute, and such findings and decisions shall be
in writing and shall be final and binding on the parties hereto, and
shall specify the reasons for and facts on which such findings and
decisions were reached. The parties shall bear equally the arbitrators'
fees and charges, and each party shall bear its other costs and
expenses for the arbitration, including attorneys' fees. The
arbitration shall be conducted in Milwaukee, Wisconsin. To the extent
that the parties hereto need to enforce the arbitration provisions in
this License Agreement or need to enforce or otherwise give effect to
any arbitration finding, decision or award, the parties hereby agree
that any such action or proceeding shall be adjudicated before a
federal or state court located in Milwaukee, Wisconsin, and they hereby
submit to the exclusive jurisdiction of the courts of the State of
Wisconsin located in Milwaukee, Wisconsin, and of the federal courts
located in Milwaukee, Wisconsin, with respect to any such action or
proceeding commenced by either party, and irrevocably waive any
objection they now or hereafter may have respecting the venue of any
such action or proceeding brought in such a court or respecting the
fact that such court is an inconvenient forum, and hereby consent to
the service of process in any such action or proceeding by means of
registered or certified mail, return receipt requested, in care of the
applicable address set forth under the notice provisions in this
License Agreement.
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5. Section 10.1 of the License Agreement dated November 15, 1991, is
hereby deleted in its entirety and the following inserted in its place:
10.1 LICENSOR shall be required to file trademark applications and to
seek trademark registrations for the Licensed Trademarks in the
Territory in order to encompass Licensed Products added pursuant to
this Fourth Amendment, but only if specifically requested by LICENSEE
and all costs associated with the preparation, filing, prosecution,
registration and maintenance of such applications and registrations
shall be paid in advance by LICENSEE. LICENSOR shall not be required to
pursue or maintain any such application or registration for which such
costs have not been paid in advance by LICENSEE at LICENSOR's request.
LICENSEE shall cooperate by providing necessary samples, invoices or
other documents necessary to support all applicable applications and
registrations for the Licensed Trademarks in connection with the
Licensed Products.
In the event LICENSOR is unable to register or to maintain its
registrations for one or more of the Licensed Trademarks in connection
with the Licensed Products in any jurisdiction in the Territory, the
parties agree to negotiate in good faith a mutually acceptable
resolution with respect to such jurisdictions, with the understanding
that neither LICENSOR nor LICENSEE shall have any liability to the
other for such inability to register or to maintain such registrations
for any such trademarks; provided, however, that in the event any
trademark application is successfully opposed in the United States or
Canada, and as a result of such successful opposition LICENSEE is
prohibited from selling Licensed Products in either the United States
or Canada, LICENSOR shall reimburse to LICENSEE the amount of Royalties
theretofore received by LICENSOR under the License Agreement relating
to the sale of the prohibited Licensed Products only, in the prohibited
jurisdiction of the United States and/or Canada only, during the three
(3) year period immediately preceding such prohibition; provided,
however, that (i) all such reimbursements shall not exceed a total of
Three Million Dollars ($3,000,000) for all prohibited Licensed Products
in both jurisdictions, (ii) LICENSOR shall not be required to make any
such reimbursement to LICENSEE if any such successful opposition or
prohibition would not have occurred if LICENSOR had not lost any
trademark rights due to LICENSEE's non-use or misuse of any of the
Licensed Trademarks and (iii) LICENSOR shall not be required to make
any such reimbursement to LICENSEE relating to prohibited Licensed
Products consisting of consumer electronic products added to Exhibit B
pursuant to this Fourth Amendment. LICENSEE shall be permitted to
terminate this License Agreement if, as a result of any successful
opposition, cancellation or infringement action relating to any of the
Licensed Trademarks in the Territory resulting in any prohibition as to
use of any of the Licensed Trademarks in the Territory, LICENSEE's
total net sales in the Territory decrease by ten percent (10%) or more;
provided, however, that (i) prohibited Licensed Products consisting of
consumer electronic products added to Exhibit B pursuant to this
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Fourth Amendment shall not be taken into consideration for this purpose
and (ii) LICENSEE shall not be able to so terminate this License
Agreement if any such opposition or cancellation action resulting in
any such prohibition as to use would not have occurred if LICENSOR had
not lost any trademark rights due to LICENSEE's non-use or misuse of
the Licensed Trademarks.
In the event that LICENSEE is prohibited, by LICENSOR, or by either a
court or an administrative agency, or both, having legal authority in
the jurisdiction at issue, from selling any or all of the Licensed
Products in any jurisdiction in the Territory as a result of any actual
or potential trademark infringement action against LICENSOR, LICENSEE's
Minimum Royalties shall be reduced, for no longer than such prohibition
remains in effect, by the sum of Royalties paid by LICENSEE to LICENSOR
for sales of the prohibited Licensed Products in the prohibited
jurisdiction in the Contract Year immediately preceding the year such
prohibition went into effect, relative to the sum of all Royalties paid
by LICENSEE to LICENSOR for sales of all Licensed Products in the
Territory in that same Contract Year; provided, however, that any such
reduction of the Minimum Royalties shall only apply to the Contract
Period consisting of the years 1998, 1999 and 2000 and shall not be
taken into consideration (i) to in any way reduce all future Minimum
Royalties calculated in accordance with Section 7.3 of the License
Agreement, or (ii) to reduce by fifty percent (50%) the amount of
Royalties that LICENSEE shall be required to pay LICENSOR pursuant to
Section 7.1 of the License Agreement.
6. The heading for Section 11 of the License Agreement dated
November, 15, 1991, Section 11.1 of the License Agreement dated November 15,
1991, and Section 16(g) of the Third Amendment and Assignment of License
Agreement dated March 31, 1997, are hereby deleted in their entirety and the
following inserted in their place:
11. REPRESENTATIONS AND INDEMNITIES
11.1 LICENSOR represents that, as of the date of this Fourth Amendment,
LICENSOR owns at least one application or registration for at least one
of the Licensed Trademarks in each jurisdiction in the Territory (as
defined in the first sentence of Section 1.4, as amended pursuant to
this Fourth Amendment). Listed in Exhibit E to the License Agreement
are LICENSOR's pending trademark applications and issued trademark
registrations relating to the License Agreement for the Licensed
Trademarks in the Territory as of the date of this Fourth Amendment. If
LICENSEE complies with the notice, cooperation and assistance
requirements of this Section 11.1 herein, LICENSOR agrees to indemnify
LICENSEE, its parent, subsidiaries and affiliates, and all officers,
directors, agents and employees thereof, and any of them, from any and
all expenses, damages, claims, suits, actions, judgments and costs
whatsoever (including reasonable attorneys' fees) (collectively,
"Damages") which LICENSEE may hereinafter
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incur, suffer or be required to pay arising out of or in connection
with any third-party claim, suit or action resulting from the use by
LICENSEE of the Licensed Trademarks in the Territory pursuant to this
License Agreement (collectively, "Third-Party Claim"); provided,
however, that LICENSOR's liability to indemnify LICENSEE (i) shall not
apply in any situation in which any Damages would not have occurred if
LICENSOR had not lost any trademark rights due to LICENSEE's non-use or
misuse of any of the Licensed Trademarks, (ii) shall not include any
Damages to the extent to which Damages are attributable to LICENSEE's
failure to cease use of the Licensed Trademarks pursuant to LICENSOR's
oral or written instructions as a result of any actual or potential
Third-Party Claim, (iii) shall not exceed the sum of the amount of
Royalties theretofore received by LICENSOR under this License
Agreement, relating to sales of only the Licensed Products at issue in
those countries affected by a final settlement, or a final
non-appealable judgment against LICENSEE, arising out of the
Third-Party Claim, during the three (3) year period immediately
preceding initiation of the Third-Party Claim to which the
indemnification relates and (iv) shall not include any Damages to the
extent to which such Damages are attributable to any consumer
electronic products added to Exhibit B pursuant to this Fourth
Amendment. The indemnification provided by LICENSOR shall only cover
Damages incurred by LICENSEE in connection with a final settlement, or
a final, non-appealable judgment against LICENSEE, arising out of a
Third-Party Claim; provided, however, that in no event shall such
indemnification include any loss of profits or consequential or
indirect damages incurred by LICENSEE. LICENSEE shall give LICENSOR
prompt written notice, cooperation and assistance in connection with
any Third-Party Claim, and LICENSOR shall have complete control over
the defense and settlement thereof.
7. Exhibit A to the License Agreement dated November 15, 1991, is
hereby deleted in its entirety and the Exhibit A attached hereto shall be
inserted in its place.
8. Exhibit B to the License Agreement dated November 15, 1991, is
hereby deleted in its entirety and the Exhibit B attached hereto shall be
inserted in its place.
9. Exhibit D to the License Agreement dated November 15, 1991, is
hereby deleted in its entirety and the Exhibit D attached hereto shall be
inserted in its place.
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10. Except as hereby amended, the License Agreement shall remain in
full force and effect.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment on the day and year first above written.
KOSS CORPORATION JIANGSU ELECTRONICS INDUSTRIES
LIMITED
By:/s/ Michael Koss By: /s/ Patrick Lam
----------------------- ---------------------------
Michael Koss, President
Name: PATRICK LAM
-------------------------
Title: VICE PRESIDENT
------------------------
CONSENT OF GUARANTOR
The undersigned, Orient Power Holdings Limited, a Bermuda company
("Orient Power"), for good and valuable consideration, the receipt of which is
hereby acknowledged, hereby consents to the foregoing Fourth Amendment to
License Agreement ("Fourth Amendment") and reaffirms its guarantee of the
performance by Jiangsu Electronics Industries Limited ("Jiangsu Electronics") or
any sublicensee of Jiangsu Electronics (Jiangsu Electronics and any sublicensee
are hereinafter collectively referred to as "Jiangsu") of all of Jiangsu's
obligations under (a) the Fourth Amendment and (b) that certain License
Agreement between Koss Corporation, as Licensor, and Trabelco N.V., as Licensee,
dated November 15, 1991, as amended by an Amendment to License Agreement dated
November 15, 1991, and a Second Amendment to License Agreement dated September
29, 1995, and a Third Amendment and Assignment of License Agreement dated as of
March 31, 1997 between Trabelco N.V., Jiangsu Electronics, Hagemeyer Electronics
(N.A.), Inc., Hagemeyer Consumer Products, Inc. d/b/a/ Koss Electronics
Products, KCP Limited and Koss Corporation (collectively, that certain License
Agreement and the amendments thereto are hereinafter referred to as the "License
Agreement"). Orient Power also guarantees the payment to Koss Corporation of any
and all amounts owed to Koss Corporation by Jiangsu under the Fourth Amendment
and the License Agreement, including but not limited to, the indemnity
obligations of Jiangsu thereunder.
Dated: May 29, 1998
ORIENT POWER HOLDINGS LIMITED
By: /s/ Simon Poon
------------------------
Name: SIMON POON
----------------------
Title: CEO
---------------------
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Exhibit A
KOSS (Plain Block Letters) (as shown in U.S. Registration No. 1,821,035)
KOSS (Stylized) (as shown in U.S. Registration No. 1,850,556)
KOSS & Design (as shown in U.S. Registration No. 2,070,098)
<PAGE> 9
Exhibit B
Product Royalty
------- -------
Clock Radios 2.0%
Radios (including mobile*) without a cassette or compact
disc player 3.0%
Audio systems of any nature (including mobile*) with a
cassette player but without a compact disc player 2.0%
Audio systems of any nature (including mobile*) with a
compact disc player and/or CD changer 1.5%
Power Amplifiers 1.5%
Telephones and telephone answering devices 2.0%
Televisions 1.5%
Video cassette recorders 1.5%
*All products which include the word "mobile" in their description in this
Exhibit B shall mean that such products so described shall include products
which are designed for use in automobiles or as battery-operated portable units.
<PAGE> 10
EXHIBIT D
Calculation of Quarterly Royalties Payment
Total Sales Returns Net Sales Royalty Rate Subtotal
----------- -------------- ----------- ------------ --------
Clock Radios $ $ 2.0%
----------- -------------- ----------- ---------
Radios (including mobile) 3.0%
without a cassette or ----------- -------------- ----------- ---------
compact disc player
Audio systems of any 2.0%
nature (including mobile) ----------- -------------- ----------- ---------
with a cassette player but
without a compact disc
player
Audio systems of any 1.5%
nature (including mobile) ----------- -------------- ----------- ---------
with a compact disc player
and/or CD changer
Power Amplifiers 1.5%
----------- -------------- ----------- ---------
Telephones and telephone 2.0%
answering devices ----------- -------------- ----------- ---------
Televisions 1.5%
----------- -------------- ----------- ---------
Video cassette recorders 1.5%
----------- -------------- ----------- ---------
Subtotal $ x
---------
Subtotal $ x
--------------
Less 2% of itemized discounts,
rebates and shipping costs ( )
--------------
ROYALTIES PAYMENT $
--------------
<PAGE> 11
Exhibit E
UNITED STATES
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
PUERTO RICO
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
CANADA
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
MEXICO
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
ARGENTINA
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
BOLIVIA
KOSS (Plain Block Letters) Pending Application
KOSS (Stylized) Pending Application
KOSS (Plain Block Letters) Pending Application
<PAGE> 12
Exhibit E
BRAZIL
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Pending Application
KOSS & Design Registered
CHILE
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Pending Application
KOSS & Design Pending Application
COLOMBIA
KOSS & Design Pending Application
COSTA RICA
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
DOMINICAN REPUBLIC
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
ECUADOR
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
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Exhibit E
EL SALVADOR
KOSS (Plain Block Letters) Pending Application
KOSS (Stylized) Registered
KOSS & Design Pending Application
GUATEMALA
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Pending Application
KOSS & Design Registered
HONDURAS
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
JAMAICA
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
NICARAGUA
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
PANAMA
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
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Exhibit E
PARAGUAY
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
PERU
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
TRINIDAD & TOBAGO
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
URUGUAY
KOSS (Plain Block Letters) Registered
KOSS (Stylized) Registered
KOSS & Design Registered
VENEZUELA
KOSS (Plain Block Letters) Pending Application
KOSS (Stylized) Pending Application
KOSS & Design Pending Application
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ADDENDUM TO LICENSE AGREEMENT
THIS ADDENDUM TO LICENSE AGREEMENT ("Addendum") is made and entered
into this 30 day of June, 1998, by and between KOSS CORPORATION, a
Delaware corporation ("LICENSOR"), and LOGITECH ELECTRONICS INC., an Ontario
company ("LICENSEE").
WITNESSETH:
WHEREAS, LICENSOR and LICENSEE are parties to a certain License
Agreement dated June 30, 1998 (the "License Agreement"); and
WHEREAS, the parties now desire to add certain terms and provisions to
the License Agreement as hereinafter provided.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. DEFINITIONS.
1.1 All defined terms used in this Addendum shall have
the same meaning as set forth in the License
Agreement unless otherwise defined in this Addendum.
1.2 "Licensed Trademarks" shall mean the "Koss"
trademarks listed on Exhibit A to this Addendum.
1.3 "Accessories" shall mean the consumer electronic
accessory products of LICENSEE set forth on Exhibit B
to this Addendum.
1.4 "Licensed Accessories" shall mean all Accessories of
LICENSEE which have the Licensed Trademarks affixed
or attached thereto in any manner.
2. GRANT OF LICENSE. Subject to all of the terms and conditions
of this Addendum, LICENSOR hereby grants to LICENSEE the exclusive right and
license to use the Licensed Trademarks in Canada only, during the Contract
Period, in connection with, and only with, the manufacturer, promotion,
distribution and sale of Accessories.
3. INCORPORATION OF PROVISIONS OF LICENSE AGREEMENT.
3.1 The following provisions of the License Agreement
(the "Incorporated Provisions") are hereby
incorporated into this Addendum as covenants and
agreements between LICENSOR and LICENSEE, with the
same force and effect as if fully set forth herein:
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Sections 2.2, 2.3, 2.4, 3.1, 3.2, 3.3, 3.4,
4.1, 4.2, 5.1, 5.2, 5.3, 5.4, 6.1, 6.4, 6.5,
7.1, 7.2, 7.3, 7.4, 8.1, 8.2, 8.3, 8.4, 9,
10.1, 10.2 (with no change in the amount of
products liability insurance), 11.1, 11.2,
11.3, 11.4, 12.1, 12.2, 13, 14, and 15.
3.2 All section references set forth in any of the
Incorporated Provisions herein shall continue to be
references to the applicable section of the License
Agreement.
3.3 For all Incorporated Provisions herein, the term
"Territory" as used in the License Agreement shall be
replaced in this Addendum with the term "Canada," the
term "Products" as used in the License Agreement
shall be replaced in this Addendum with the term
"Accessories," and the term "Licensed Products" as
used in the License Agreement shall be replaced in
this Addendum with the term "Licensed Accessories."
3.4 With respect to the Incorporated Provisions in this
Addendum, any reference to an Exhibit to the License
Agreement shall instead be deemed to be a reference
to the corresponding Exhibit to this Addendum. For
example, a reference in an Incorporated Provision to
Exhibit C of the License Agreement shall be deemed
instead to be a reference to Exhibit C to this
Addendum.
4. MISCELLANEOUS.
4.1 Section headings contained herein are solely for the
purpose of aiding in speedy location of subject
matter and are not in any sense to be given weight in
the construction of this Addendum. Accordingly, in
case of any question with respect to the construction
of this Addendum, it is to be construed as though
such section headings had been omitted.
4.2 This Addendum constitutes the entire agreement
between the parties hereto and may not be changed or
modified except by a writing signed by the parties
hereto.
4.3 If and to the extent that any provisions of this
Addendum are prohibited or unenforceable under any
applicable law, such provisions shall be ineffective
to the extent of such prohibition or unenforceable
without invalidating the remaining provisions hereof
or affecting the validity or enforceability of any
other provision hereof.
4.4 The failure of either party at any time or times to
demand strict performance by the other of any of the
terms, covenants or conditions set forth herein shall
not be construed as a continuing waiver or
relinquishment thereof and each may at any time
demand strict and
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complete performance by the other of said terms,
covenants and conditions.
4.5 This Addendum shall be governed by the substantive
laws of the State of Wisconsin (regardless of laws
that might be applicable under principles of
conflicts of laws) as to all matters, including but
not limited to matters of validity, construction,
effect and performance. Resolution of any and all
disputes between LICENSOR and LICENSEE arising from
or in connection with this Addendum, whether based on
contract, tort, common law, equity, statute,
regulation, order or otherwise, shall be governed by
and settled in accordance with binding arbitration by
three (3) arbitrators; provided, however, that the
three arbitrators selected shall each have extensive
knowledge in the area of federal trademark law. If
the parties cannot agree on the selection of three
arbitrators, each party shall select one arbitrator,
and those two arbitrators together shall select the
third arbitrator, and the three arbitrators, each of
which shall have extensive knowledge in the area of
federal trademark law, shall resolve the dispute as
provided herein. The arbitrators' findings and
decisions shall be limited to the subject matter of
the dispute, and such findings and decisions shall be
in writing and shall be final and binding on the
parties hereto, and shall specify the reasons for and
facts on which such findings and decisions were
reached. The parties hereto shall bear equally the
arbitrators' fees and charges, and each party shall
bear its other costs and expenses for the
arbitration, including attorneys' fees. The
arbitration shall be conducted in Milwaukee,
Wisconsin. To the extent that the parties hereto need
to enforce the arbitration provisions in this
Addendum or need to enforce or otherwise give effect
to any arbitration finding, decision or award, the
parties hereto hereby agree that any such action or
proceeding shall be adjudicated before a federal or
state court located in Milwaukee, Wisconsin, and they
hereby submit to the exclusive jurisdiction of the
courts of the State of Wisconsin located in
Milwaukee, Wisconsin, and of the federal courts
located in Milwaukee, Wisconsin, with respect to any
such action or proceeding commenced by either party.
The parties hereto irrevocably waive any objection
they now or hereafter may have respecting the venue
of any such action or proceeding brought in such a
court or respecting the fact that such court is an
inconvenient forum, and hereby consent to the service
of process in any such action or proceeding by means
of registered or certified mail, return receipt
requested, in care of the applicable address set
forth under the notice provisions in this Addendum.
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IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be
executed as of the date set forth above. The effective date of this Addendum is
July 1, 1998.
KOSS CORPORATION
By:/s/ Michael J. Koss
------------------------------
Michael J. Koss
Title: President and CEO
LOGITECH ELECTRONICS INC.
By:/s/ Greg Bell
------------------------------
Print Name: Greg Bell
-------------------
Title: President and CEO
------------------------
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EXHIBIT A
KOSS (Plain Block Letters) (as shown in U.S. Registration No. 1,821,035)
KOSS (Stylized) (as shown in U.S. Registration No. 1,850,556)
KOSS & Design (as shown in U.S. Registration No. 2,070,098)
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EXHIBIT B
Description of Accessory Products to be sold under the Licensed
Trademarks.
Those accessory products of Licensee suitable for use with any audio,
video, communication, or computer products and peripherals, but specifically
excluding any type of headphone, stereophones or any type of security product or
device.
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EXHIBIT C
TO:
FROM: (Subcontractor) Manufacturing Factory
RE: Use of the "Koss" Brandname
The purpose of this letter is to acknowledge that ___________________ has the
right to manufacture Licensed Accessories, as defined in the Addendum to License
Agreement between Logitech Electronics Inc. and Koss Corporation dated
___________, 1998 ("Addendum"), bearing the "Koss" brandname and trademarks only
for the account of Logitech Electronics Inc. and only as a subcontract
manufacturer pursuant to Sections 2.2 and 2.3 of the License Agreement between
Logitech Electronics Inc. and Koss Corporation dated _________, 1998 and for no
other purpose. We agree that we will not use the "Koss" name on any products
other than those manufactured for Logitech Electronics Inc.'s account.
__________ agrees that neither it nor any affiliated or related individual or
entity (i) will, at any time, file any application for trademark registration or
otherwise obtain or attempt to obtain ownership of the "Koss" brandname or
trademarks, or any name or mark which is confusingly similar thereto, anywhere
in the word or (ii) directly or indirectly challenge or contest Koss
Corporation's ownership of or rights in the "Koss" brandname and tradenames,
whether for the Licensed Accessories or otherwise.
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EXHIBIT D
Calculation of Quarterly Royalties Payment (in U.S. Dollars)
Accessory Products Total Sales Returns Net Sales Royalty Rate
$ $ $ 10%
---------- ------ -------- -------
ROYALTIES PAYMENT U.S. $
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