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Exhibit 10.33
AMENDMENT NO. 3 TO THE DEVELOPMENT, MARKETING AND DISTRIBUTION AGREEMENT BETWEEN
SENSORY SCIENCE CORPORATION AND LOEWE OPTA GMBH DATED JANUARY 1, 1997
This Amendment No. 3 to the Development, Marketing and Distribution
Agreement (the "Amendment") is entered into as of the 11th day of September,
2000, by and between Loewe Opta GmbH, a German corporation ("Loewe"), and
Sensory Science Corporation a Delaware (U.S.A.) Corporation ("SSC"), in light of
the following:
Fact One: Loewe and SSC have previously entered into that certain
Development, Marketing and Distribution Agreement, dated as of January 1, 1997
(the "Agreement") which has prior hereto been amended twice.
Fact Two: Loewe and SSC desire to amend the Agreement for a third time
as provided for and on the conditions set forth herein.
NOW, THEREFORE, Loewe and SSC hereby amend and supplement the Agreement
as follows:
1. Definitions. All initially capitalized terms used in this Amendment
shall have the meanings given to them in the Agreement unless specifically
defined herein.
2. Amendments.
(A) The first paragraph of Section 17 (Duration and Term of Agreement),
is hereby deleted in its entirety and replaced with the following paragraph:
This Agreement shall be effective as of January 1, 1997 and shall, subject to
the provisions for earlier termination stated in Section 18 below, continue in
force until January 1, 2002. The Agreement shall be automatically renewed for an
additional three (3) year period if neither party has provided written notice to
the other prior to September 1, 2001 of its intention to terminate the
Agreement.
(B) Section 1 (Definitions) is hereby amended by modifying the
definition of "Territory" thereunder to exclude the countries of Canada and
Mexico. For the exclusion of Canada and Mexico from the Territory, SSC receives
the benefits described in Sections (C) and (D) of this document, without any
additional cash payments by Loewe.
(C) Section 16 (Toolings) is hereby amended by adding the following
provisions thereto: shall be deleted in their entirety and be replaced with the
following provisions:
(i) All future tool payments, effective with payments provided for in
subparagraph (ii) hereof, shall be contracted and made by Loewe and shall be
their sole property and
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Exhibit 10.33
may be used for purposes other than those set forth in this Agreement; including
for T.V. sets used outside the United States.
(ii) As of the date of this Amendment No. 3, all costs of tooling as set forth
in Schedule 4 and as otherwise agreed upon by the parties shall be paid by
Loewe. Loewe explicitly waives without prejudice its receivable against SSC
according to Schedule 4 of the Development, Marketing, and Distribution
Agreement in the amount of DM 450,000 due in 1998.
Loewe and SSC herein agree that the remaining tooling payments for the 38" T.V.s
shall be timely paid by Loewe in the approximate amount $700,000. US which
includes an estimate of $100,000. for tooling modifications relating to a "flat
screen model". The Loewe payment of such $700,000. of toolings costs is subject
to Loewe's receipt of a copy of SSC's contract with the tool maker, and SSC's
notification to the toolmaker prior to the execution of this amendment that
Loewe will pay the remaining tooling payments of approximately $700,000. and,
therefore, Loewe will become the sole owner of the tooling. Furthermore, SSC
explicitly waives the rights resulting from the payment of $300,000. to the
toolmaker, and Loewe requires a written confirmation by the toolmaker that
ownership of the tooling will pass to Loewe upon payment of the remaining
balance. Additional tooling expenses for U.S. T.V. sets may be passed on to SSC
through adjustment of Loewe's sales prices; if tooling is used exclusively in
the United States, there will be a $70.00 U.S. surcharge per set (assuming total
volume of 10,000 units) to SSC; provided, however, that if such T.V. sets are
also usable outside the U.S., the U.S. surcharge (assuming total volume of
14,000 units) shall be reduced to $50.00 per T.V. set.
(D) A new paragraph 22.3 is added to Section 22 (Miscellaneous) as
follows:
22.3 Loewe agrees to buy back the following indicated Product inventory in the
aggregate sum of approximately $1,349,960. US to be composed of the following
T.V. model Products at the indicated book value prices:
Proposed 750 Arcadas sets X $1,319.00 per set = $990,750., 230 sets of Planus
black matte T.V. models at a per set purchase price of $1,307.00 = $300,610. and
50 sets of Calides X $1,172.00 = $58,600., each in order that the total Product
buy back hereunder aggregates the sum of $1,349,960 US; such Product buy back
purchases to be made within 3 (three) weeks of the date of execution of this
Amendment No. 3 provided the following conditions shall apply:
(a) exclusivity protection to SSC is waived with respect to such repurchased
Products so long as the repurchased Products are not sold in the United States
to a customer in direct competition with SSC's distribution channels.
(b) SSC will obtain and forward to Loewe a written consent from Congress Bank
with respect to the release of their security interest in the subject Products.
(c) All repurchased Products are subject to prior inspection by Loewe before
purchase thereof and such Products will be delivered, at SSC's cost for freight
and insurance if any, to Loewe's designated and approved warehouse, storage and
insurance cost to be
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Exhibit 10.33
borne by Loewe.
For future purchases of SSC out of the above Product inventory, the following
prices shall apply: Arcada $748 per set, Planus $1,036 per set and Calidas $715
per set.
3. Counterparts; Effectiveness. This Amendment may be executed in any number of
counterparts and by different parties on separate counterparts, each of which
when so executed and delivered shall be deemed to be an original. All such
counterparts, taken together, shall constitute but one and the same Amendment.
This Amendment shall become effective upon the execution of a counterpart of
this Amendment by each of the parties hereto.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties as of
the 11th day of September, 2000.
SENSORY SCIENCE CORPORATION, a Delaware (United States) corporation
By: /s/ Roger B. Hackett
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Roger B. Hackett
Its: Chairman of the Board, Chief
Executive Officer and President
LOEWE OPTA GmbH, A Federal Republic of Germany Corporation
By: /s/ Rainer Hecker
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Dr. Rainer Hecker
Its: Chairman of the Board of Management
By: /s/ Klaus Deisler
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Mr. Klaus Deisler
Its: Managing Director
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