Nautilus 2003 Annual Report Download - page 81

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FIFTH AMENDMENT TO LICENSE AGREEMENT
This Fifth Amendment (hereinafter, “Amendment”) is made this 31st day of December, 2002, and amends the License Agreement dated April
26, 1999, by and between Piaget Associates, L.L.C. (hereinafter, “Licensor”) and The Nautilus Group, Inc., formerly known as Direct Focus,
Inc. (hereinafter, “Licensee”).
The purpose of this Amendment is to provide the following modifications to the Agreement, and Amendments, as set forth below.
1.
Paragraph 4.1 of the Agreement is replaced in its entirety as follows:
Licensee shall use its best reasonable efforts to develop, market and sell Licensed Goods. Licensee commits to making a national
roll-out of the contemplated direct response infomercial by June 30, 2003. Failure to do so will constitute an event of default giving
Licensor the right of termination pursuant to Paragraph 5.2(B). However, in the event Licensee has not commenced a national roll-
out of the direct response infomercial by June 30, 2003, Licensee may extend its license rights for up to an additional three (3)
months by continuing to pay the minimum quarterly royalty in the amount of $27,500. These payments will not count towards the
advanced royalty.
Additionally, Licensee agrees to develop, market and offer for sale a club version on or before March 31, 2005. Failure to develop,
market and offer for sale a club version by this date will result in termination of Licensee’s right to exclusively develop, market and
offer for sale a club version of the Licensed Goods.
2. Paragraph 4.1, third sentence, delete the phrase “paragraph 4.1(D) ii of $25,000 per quarter.” and replace with the phrase
“
paragraph 4.1(D) ii of $27,500 per quarter
”
.
3. Paragraph 4.1(D)(ii), first sentence, delete the beginning phrase “$25,000 minimum per quarter” and replace with the phrase
“
27,500 minimum per quarter
”
.
4.
Insert new Paragraph 6.14 as follows:
Licensor has knowledge and capabilities, which will assist Licensee in achieving its objectives as anticipated under this Agreement.
Licensor will disclose to Licensee such knowledge and will advise and assist Licensee, and its technical staff, as required and at
reasonable times and in reasonable ways in consideration for which Licensee shall reimburse Licensor for reasonable travel
expenses if Licensor is required to travel outside the State of Washington.
5.
In the event of a conflict between the terms and conditions of this Amendment and those contained in the Agreement, the provisions
of this Amendment shall govern.
6.
All other terms and conditions of the Agreement remain in full force and effect.