SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
for the quarterly period ended September 30, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 0-3295
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KOSS CORPORATION
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(Exact Name of Registrant as Specified in its Charter)
A DELAWARE CORPORATION 39-1168275
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4129 North Port Washington Avenue, Milwaukee, Wisconsin 53212
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(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (414) 964-5000
---------------------------
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
--- ---
At September 30, 2001, there were 1,839,527 shares outstanding of the
Registrant's common stock, $0.01 par value per share.
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KOSS CORPORATION AND SUBSIDIARIES
FORM 10-Q
September 30, 2001
INDEX
Page
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Condensed Consolidated Balance Sheets (Unaudited)
September 30, 2001 and June 30, 2001 3
Condensed Consolidated Statements
of Income (Unaudited)
Three months ended September 30, 2001 and 2000 4
Condensed Consolidated Statements of Cash
Flows (Unaudited)
Three months ended September 30, 2001 and 2000 5
Notes to Condensed Consolidated Financial
Statements (Unaudited) September 30, 2001 6-8
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 9-11
PART II OTHER INFORMATION
Item 4 Submission of Matters to a Vote of Security-Holders 13
Item 6 Exhibits and Reports on Form 8-K 14
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KOSS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30, 2001 June 30, 2001
------------------ -------------
ASSETS
Current Assets:
Cash $ 336,317 $ 181,678
Accounts receivable 9,006,711 8,247,045
Inventories 7,998,156 8,496,010
Income taxes receivable -- 480,322
Other current assets 1,166,864 934,934
-----------------------------------------------------------------------------------------------------------------------
Total current assets 18,508,048 18,339,989
Property and Equipment, net 1,694,663 1,690,628
Other Assets 1,465,711 1,465,711
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$21,668,422 $21,496,328
=======================================================================================================================
LIABILITIES AND STOCKHOLDERS' INVESTMENT
Current Liabilities:
Accounts payable $ 1,896,140 $ 2,062,476
Accrued liabilities 1,461,778 1,551,679
Income taxes payable 26,724 --
Dividends payable 462,891 --
-----------------------------------------------------------------------------------------------------------------------
Total current liabilities 3,847,533 3,614,155
Long-Term Debt 3,465,400 --
Deferred Compensation 1,044,160 1,015,390
Other Liabilities 437,354 437,354
Contingently Redeemable Equity Interest 1,490,000 1,490,000
Stockholders' Investment 11,383,975 14,939,429
-----------------------------------------------------------------------------------------------------------------------
$21,668,422 $21,496,328
=======================================================================================================================
See accompanying notes.
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KOSS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended September 30 2001 2000
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Net sales $ 8,951,411 $ 9,879,638
Cost of goods sold 5,499,520 5,927,391
----------------------------------------------------------------------------------------------------------------
Gross profit 3,451,891 3,952,247
Selling, general and
administrative expense 1,925,964 2,049,787
----------------------------------------------------------------------------------------------------------------
Income from operations 1,525,927 1,902,460
Other income (expense)
Royalty income 167,714 293,888
Interest income 7,281 45,387
Interest expense (10,964) (7,816)
----------------------------------------------------------------------------------------------------------------
Income before income tax provision 1,689,958 2,233,919
Provision for income taxes 659,084 849,928
----------------------------------------------------------------------------------------------------------------
Net income $ 1,030,874 $ 1,383,991
================================================================================================================
Earnings per common share:
Basic $0.54 $0.62
Diluted $0.50 $0.59
================================================================================================================
Dividends per common share $0.25 None
================================================================================================================
See accompanying notes.
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KOSS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended September 30 2001 2000
------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $ 1,030,874 $ 1,383,991
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization 154,785 180,959
Deferred compensation 28,770 28,770
Net changes in operating assets and
liabilities (242,933) 635,846
------------------------------------------------------------------------------------------------------
Net cash provided by operating
activities 971,496 2,229,566
------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of equipment
and leasehold improvements (158,820) (119,329)
------------------------------------------------------------------------------------------------------
Net cash used in
investing activities (158,820) (119,329)
------------------------------------------------------------------------------------------------------
CASH FLOWS FROM
FINANCING ACTIVITIES:
Repayments under line of credit agreements (615,000) --
Borrowings under line of credit agreements 4,080,400 --
Purchase of common stock for treasury (3,391,312) --
Purchase and retirement of common stock (844,325) (3,987,125)
Exercise of stock options 112,200 76,288
------------------------------------------------------------------------------------------------------
Net cash used in financing
activities (658,037) (3,910,837)
------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash 154,639 (1,800,600)
Cash at beginning of period 181,678 3,164,401
------------------------------------------------------------------------------------------------------
Cash at end of period $ 336,317 $ 1,363,801
======================================================================================================
The Company paid $462,891 in dividends to stockholders in October 2001 which is
not included in cash flows from financing activities for the quarter ended
September 30, 2001.
See accompanying notes.
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KOSS CORPORATION AND SUBSIDIARIES
September 30, 2001
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The financial statements presented herein are based on interim amounts.
In the opinion of management, all adjustments (consisting only of
normal recurring accruals) necessary to present fairly the financial
position, results of operations and cash flows at September 30, 2001
and for all periods presented have been made. The income from
operations for the quarter ended September 30, 2001 is not necessarily
indicative of the operating results for the full year.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been condensed
or omitted. It is suggested that these condensed consolidated financial
statements be read in conjunction with the financial statements and
notes thereto included in the Registrant's June 30, 2001, Annual Report
on Form 10-K.
2. EARNINGS PER COMMON SHARE AND STOCK SPLIT
Basic earnings per share are computed based on the weighted average
number of common shares outstanding. The weighted average number of
common shares outstanding for the quarters ending September 30, 2001
and 2000 were 1,917,806 and 2,236,893, respectively. When dilutive,
stock options are included as share equivalents using the treasury
stock method. Common stock equivalents of 123,889 and 90,956 related to
stock option grants were included in the computation of the average
number of shares outstanding for diluted earnings per share for the
quarters ended September 30, 2001 and 2000, respectively.
On October 2, 2001, the Company issued a Press Release declaring a 2
for 1 split of the Company's common stock for stockholders of record on
October 22, 2001 with the effective date being November 5, 2001. Had
this stock split been effective prior to September 30, 2001, the number
of outstanding common shares would have increased to 3,679,054 and
earnings per common share basic and diluted for the quarters ending
September 30, 2001 and 2000, on a pro forma basis would have been as
follows:
September 30 2001 2000
------------------------------------
Basic $ 0.27 $ 0.31
Diluted $ 0.25 $ 0.30
Subsequent to the effective date of this common stock split all
historical earnings per common share amounts disclosed in the future
will be restated to give effect to this common stock split.
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3. INVENTORIES
The classification of inventories is as follows:
September 30, 2001 June 30, 2001
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Raw materials and
work in process $ 2,439,787 $ 3,064,147
Finished goods 6,539,387 6,412,881
--------------------------------------------------------------------------------
8,979,174 9,477,028
LIFO Reserve (981,018) (981,018)
--------------------------------------------------------------------------------
$ 7,998,156 $ 8,496,010
================================================================================
4. STOCK PURCHASE AGREEMENT
The Company has an agreement with its Chairman to repurchase stock from
his estate in the event of his death. The repurchase price is 95% of
the fair market value of the common stock on the date that notice to
repurchase is provided to the Company. The total number of shares to be
repurchased shall be sufficient to provide proceeds which are the
lesser of $2,500,000 or the amount of estate taxes and administrative
expenses incurred by his estate. The Company is obligated to pay in
cash 25% of the total amount due and to execute a promissory note at
the prime rate of interest for the balance. The Company maintains a
$1,150,000 life insurance policy to fund a substantial portion of this
obligation. At September 30, 2001 and June 30, 2001, $1,490,000 has
been classified as a Contingently Redeemable Equity Interest reflecting
the estimated obligation in the event of execution of the agreement.
5. RECLASSIFICATIONS
Certain amounts in the prior year financial statements have been
reclassified to conform to the current year presentation.
6. NEW ACCOUNTING PRONOUNCEMENTS
In July 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (FAS) No. 141, "Business
Combinations" and No. 142, "Goodwill and Other Intangible Assets." The
statements eliminate the pooling-of-interests method of accounting for
business combinations and require that goodwill and certain intangible
assets not be amortized. Instead, these assets will be reviewed for
impairment annually with any related losses recognized in earnings when
incurred. The statements will be effective for the Company as of July
1, 2002 for existing goodwill and intangible assets and for business
combinations initiated after June 30, 2001. The Company is currently
analyzing the impact these statements will have; however, the impact is
not expected to be material on the Company's financial position or
results of operations.
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In July 2001, the FASB also issued FAS No. 143, "Accounting for Asset
Retirement Obligations" and in August 2001, issued No. 144, "Accounting
for the Impairment or Disposal of Long-Lived Assets." FAS No. 143
establishes accounting standards for the recognition and measurement of
an asset retirement obligation. FAS No. 144 addresses financial
accounting and reporting for the impairment or disposal of long-lived
assets, superseding FAS No. 121. The statements are effective for the
Company July 1, 2002. The Company is currently analyzing the impact
these statements will have; however, the impact is not expected to be
material on the Company's financial position or results of operations.
In April 2001, the EITF reached a consensus on EITF Issue No. 00-25,
"Accounting for Consideration from a Vendor to a Retailer in Connection
with the Purchase or Promotion of the Vendor's Products." This issue
requires that consideration from a vendor to a retailer (a) in
connection with the retailer's purchase of the vendor's products or (b)
to promote sales of the vendor's products by the retailer be classified
as a reduction of net sales unless the consideration meets certain
criteria. EITF No. 00-25 is effective for the Company's fiscal quarters
beginning after December 15, 2001 and requires reclassification of
prior periods. The Company is currently evaluating the impact of
implementing EITF No. 00-25.
7. SUBSEQUENT EVENT
On October 29, 2001, the Company declared a quarterly cash dividend of
$0.12 per share for stockholders of record on December 31, 2001 to be
paid January 15, 2002, which dividend reflects the effect of the 2 for 1
stock split referenced in the Company's October 2, 2001 Press Release.
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KOSS CORPORATION AND SUBSIDIARIES
FORM 10-Q - September 30, 2001
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Financial Condition and Liquidity
Cash provided by operating activities during the three months ended September
30, 2001 amounted to $971,496. This was a result of net income for the period
offset by changes in operating assets and liabilities, primarily related to
increases in accounts receivable and income taxes payable and decreases in
inventories and accounts payable.
Capital expenditures for new property and equipment (including production
tooling) were $158,820 for the quarter. Budgeted capital expenditures for fiscal
year 2002 are $1,239,865. The Company expects to generate sufficient funds
through operations to fund these expenditures.
Stockholders' investment decreased to $11,383,975 at September 30, 2001, from
$14,939,429 at June 30, 2001. The decrease reflects the effect of net income,
the purchase and retirement of common stock, the purchases of common stock for
treasury, dividends declared and not paid, and the exercise of stock options for
the quarter.
The Company amended its existing credit facility in October 2001, extending the
maturity date of the unsecured line of credit to November 1, 2002. This credit
facility provides for borrowings up to a maximum of $10,000,000. The Company can
use this credit facility for working capital purposes or for the purchase of its
own stock pursuant to the Company's stock repurchase program. Borrowings under
this credit facility bear interest at the bank's prime rate, or LIBOR plus
1.75%. This credit facility includes certain financial covenants that require
the Company to maintain a minimum tangible net worth and specified current,
interest coverage, and leverage ratios. Outstanding draws on this credit
facility at September 30, 2001 was $3,465,400. There was no utilization of this
credit facility at June 30, 2001.
In April of 1995, the Board of Directors approved a stock repurchase program
authorizing the Company to purchase from time to time up to $2,000,000 of its
common stock for its own account. In January of 1996, the Board of Directors
approved an increase in the stock repurchase program from $2,000,000 to
$3,000,000. In July of 1997, the Board of Directors again approved an increase
in the stock repurchase program from $3,000,000 to $5,000,000. In January of
1998, the Board of Directors approved an increase of an additional $2,000,000,
increasing the total stock repurchase program from $5,000,000 to $7,000,000. In
August of 1998, the Board of Directors approved an increase of $3,000,000 in the
Company's stock repurchase program, thereby increasing the total amount of stock
repurchases from $7,000,000 to $10,000,000. In April of 1999, the Board of
Directors again approved an increase in the stock repurchase program from
$10,000,000 to $15,000,000. In October of 1999, the Board of Directors increased
the stock repurchase program by another $5,000,000, up to a maximum of
$20,000,000, and in July of 2000 the Board increased the program by an
additional $5,000,000, for a maximum of $25,000,000. In January of 2001, the
Board of Directors approved an increase in the stock repurchase program from
$25,000,000 to $28,000,000, another increase in April of 2001 of an additional
$3,000,000, and an additional increase of $3,000,000 in July of 2001 for a
maximum of $34,000,000. The Company intends to effectuate all stock purchases
either on the open market or through privately negotiated transactions, and
intends to finance all stock purchases through its own cash flow or by borrowing
for such purchases.
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For the quarter ended September 30, 2001, the Company purchased 103,851 shares
of its common stock at an average gross price of $40.79 per share (and an
average net price of $39.71 per share), and retired all such shares except
83,851 of such shares which are being held as treasury shares.
From the commencement of the Company's stock repurchase program through
September 30, 2001, the Company has purchased and retired a total of 2,381,590
shares for a total gross purchase price of $37,396,245 (representing an average
gross purchase price of $15.70 per share) and a total net purchase price of
$33,560,472 (representing an average net purchase price of $14.09 per share).
The difference between the total gross purchase price and the total net purchase
price is the result of the Company purchasing from certain employees shares of
the Company's stock acquired by such employees pursuant to the Company's stock
option program. In determining the dollar amount available for additional
purchases under the stock repurchase program, the Company uses the total net
purchase price paid by the Company for all stock purchases, as authorized by the
Board of Directors.
The Company also has an Employee Stock Ownership and Trust ("ESOP") pursuant to
which shares of the Company's stock are purchased by the ESOP for allocation to
the accounts of ESOP participants. For the quarter ended September 30, 2001, the
ESOP did not purchase any shares of the Company's stock.
Results of Operations
Net sales for the first quarter ended September 30, 2001 were $8,951,411
compared with $9,879,638 for the same period in 2000, a decrease of $928,227.
This was due to slight softening of sales during July and August coupled with
the loss of store traffic during the final three weeks of September, which
resulted in vastly reduced retail sales that impacted automatic product
replenishment.
Gross profit as a percent of net sales decreased to 39% for the quarter ended
September 30, 2001 compared with 40% in the prior year, as a result of a lower
rate of overhead absorption from declining sales.
Selling, general and administrative expenses for the quarter ended September 30,
2001 were $1,925,964 or 22% of net sales, compared to $2,049,787 or 21% of net
sales for the same period in 2000.
Interest expense amounted to $10,964 for the quarter as compared to $7,816 for
the same period in the prior year. This increase is due to higher levels of
borrowings.
The Company has a License Agreement with Jiangsu Electronics Industries Limited
("Jiangsu"), a subsidiary of Orient Power Holdings Limited, by way of an
assignment of a previously existing License Agreement with Trabelco N.V. Orient
Power is based in Hong Kong and has an extensive portfolio of audio and video
products. This License Agreement covers the United States, Canada, and Mexico,
and has been renewed through December 31, 2002. Pursuant to this License
Agreement, Jiangsu has agreed to meet certain minimum royalty amounts each year.
The products covered by this License Agreement include various consumer
electronics products. Royalty income from the licensing agreement with Jiangsu
was dramatically affected by the depressed market conditions resulting in a
reduction in royalty payments of 43% from $293,888 for the quarter ended
September 30, 2000 to $167,714 for the quarter ended September 30, 2001.
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Effective July 1, 1998, the Company entered into a License Agreement and an
Addendum thereto with Logitech Electronics Inc. ("Logitech") of Ontario, Canada
whereby the Company licensed to Logitech the right to sell multimedia/computer
speakers under the Koss brand name. This License Agreement covers North America
and certain countries in South America and Europe, requiring royalty payments by
Logitech through June 30, 2008, subject to certain minimum annual royalty
amounts.
On July 25, 2001, the Company issued a Press Release declaring a quarterly cash
dividend of $0.25 per share for stockholders of record on September 30, 2001 to
be paid on October 15, 2001, which is recorded as dividends payable.
On October 2, 2001, the Company issued a Press Release declaring a 2 for 1 stock
split of the Company's common stock. The record date being October 22, 2001 and
the effective date being November 5, 2001.
On October 29, 2001 the Company issued a Press Release declaring a quarterly
cash dividend of $0.12 per share (reflecting the effect of the 2 for 1 stock
split) payable on January 15, 2002 to shareholders of record on December 31,
2001.
New Accounting Pronouncements
In July 2001, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (FAS) No. 141, "Business Combinations" and No.
142, "Goodwill and Other Intangible Assets." The statements eliminate the
pooling-of-interests method of accounting for business combinations and require
that goodwill and certain intangible assets not be amortized. Instead, these
assets will be reviewed for impairment annually with any related losses
recognized in earnings when incurred. The statements will be effective for the
Company as of July 1, 2002 for existing goodwill and intangible assets and for
business combinations initiated after June 30, 2001. The Company is currently
analyzing the impact these statements will have; however, the impact is not
expected to be material on the Company's financial position or results of
operations.
In July 2001, the FASB also issued FAS No. 143, "Accounting for Asset Retirement
Obligations" and in August 2001, issued No. 144, "Accounting for the Impairment
or Disposal of Long-Lived Assets." FAS No. 143 establishes accounting standards
for the recognition and measurement of an asset retirement obligation. FAS No.
144 addresses financial accounting and reporting for the impairment or disposal
of long-lived assets, superseding FAS No. 121. The statements are effective for
the Company July 1, 2002. The Company is currently analyzing the impact these
statements will have; however, the impact is not expected to be material on the
Company's financial position or results of operations.
In April 2001, the EITF reached a consensus on EITF Issue No. 00-25, "Accounting
for Consideration from a Vendor to a Retailer in Connection with the Purchase or
Promotion of the Vendor's Products." This issue requires that consideration from
a vendor to a retailer (a) in connection with the retailer's purchase of the
vendor's products or (b) to promote sales of the vendor's products by the
retailer be classified as a reduction of net sales unless the consideration
meets certain criteria. EITF No. 00-25 is effective for the Company's fiscal
quarters beginning after December 15, 2001 and requires reclassification of
prior periods. The Company is currently evaluating the impact of implementing
EITF No. 00-25.
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Form 10-Q contains forward-looking statements within the meaning of that
term in the Private Securities Litigation Reform Act of 1995(the "Act") (Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934). Additional written or oral forward-looking statements may be made by
the Company from time to time in filings with the Securities Exchange
Commission, press releases, or otherwise. Statements contained in this Form 10-Q
that are not historical facts are forward-looking statements made pursuant to
the safe harbor provisions of the Act. Forward-looking statements may include,
but are not limited to, projections of revenue, income or loss and capital
expenditures, statements regarding future operations, anticipated financing
needs, compliance with financial covenants in loan agreements, plans for
acquisitions or sales of assets or businesses, plans relating to products or
services of the Company, assessments of materiality, predictions of future
events, the effects of pending and possible litigation, and assumptions relating
to the foregoing. In addition, when used in this Form 10-Q, the words
"anticipates," "believes," or "estimates," "expects," "intends," "plans" and
variations thereof and similar expressions are intended to identify
forward-looking statements.
Forward-looking statements are inherently subject to risks and uncertainties,
some of which cannot be predicted or quantified based on current expectations.
Consequently, future events and actual results could differ materially from
those set forth in, contemplated by, or underlying the forward-looking
statements contained in this Form 10-Q, or in other Company filings, press
releases, or otherwise. In addition to the factors discussed in this Form 10-Q,
other factors that could contribute to or cause such differences include, but
are not limited to, developments in any one or more of the following areas:
future fluctuations in economic conditions, the receptivity of consumers to new
consumer electronics technologies, the rate and consumer acceptance of new
product introductions, competition, pricing, the number and nature of customers
and their product orders, production by third party vendors, foreign
manufacturing, sourcing and sales (including foreign government regulation,
trade and importation concerns), borrowing costs, changes in tax rates, pending
or threatened litigation and investigations, and other risk factors which may be
detailed from time to time in the Company's Securities and Exchange Commission
filings.
Readers are cautioned not to place undue reliance on any forward-looking
statements contained herein, which speak only as of the date hereof. The Company
undertakes no obligation to publicly release the result of any revisions to
these forward-looking statements that may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of unexpected
events.
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PART II OTHER INFORMATION
Item 4 Submission of Matters to Vote of Security-Holders
(a) On October 18, 2001 an Annual Meeting of Stockholders was held.
(b) Proxies for the election of directors were solicited
pursuant to Regulation 14. There was no solicitation in opposition
to management's nominees, and all such nominees were elected.
(c) There were 1,913,378 shares of common stock eligible to vote at the
Annual Meeting, of which 1,874,798 shares were present at the
Annual Meeting in person or by proxy, which constituted a quorum.
The following is a summary of the results of the voting:
Number of Votes
--------------- Broker
For Withheld Non-Votes
--- -------- ---------
Nominees for 1-year
terms ending in 2002:
John C. Koss 1,665,192 209,606 0
Thomas L. Doerr 1,684,142 190,656 0
Victor L. Hunter 1,684,142 190,656 0
Michael J. Koss 1,682,083 192,715 0
Lawrence S. Mattson 1,684,342 190,456 0
Martin F. Stein 1,685,018 189,780 0
John J. Stollenwerk 1,685,237 189,561 0
Number of Votes
---------------
For Against Non-Votes
--- -------- ---------
Amendment to the 1990
Flexible Incentive Plan to
increase the number of
shares available for grant
thereunder 1,478,505 245,409 6,074
Number of Votes
--------------- Broker
For Against Abstain Non-Votes
--- -------- --------- ---------
Appointment of
PricewaterhouseCoopers LLP
as independent auditors
for the year ended
June 30, 2002 1,872,390 432 1,976 0
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Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits Filed
Amendment to Loan Agreement dated October 10, 2001.
(b) Reports on Form 8-K
The Company filed a Form 8-K on July 27, 2001
announcing the Company's intent to begin paying
quarterly dividends beginning with the quarter ending
September 30, 2001.
The Company also filed a Form 8-K on October 5, 2001
announcing a 2 for 1 stock split effective for
shareholders of record on October 22, 2001 with a
distribution date of November 5, 2001.
Signatures
Pursuant to the requirements of the Securities and Exchange
Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto authorized.
KOSS CORPORATION
Dated: 11/2/01 /s/ Michael J. Koss
------- ---------------------------
Michael J. Koss
Vice Chairman, President,
Chief Executive Officer,
Chief Financial Officer
Dated: 11/2/01 /s/ Sue Sachdeva
------- ---------------------------
Sue Sachdeva
Vice President--Finance
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