##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 for the quarterly period ended March 31, 2006
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
  
 KOSS CORPORATION
 
  A DELAWARE CORPORATION
    
    39-1168275(State or other jurisdiction of
incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 4129 North Port Washington Avenue, Milwaukee, Wisconsin
    
    53212(Address of principal executive offices)
    
    (Zip Code)
 Registrants telephone number, including area code:
    
    (414) 964-5000
  þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
  o þ




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PagePART I FINANCIAL INFORMATIONItem 1 Financial StatementsCondensed Consolidated Balance Sheets
March 31, 2006 (Unaudited) and June 30, 2005
    
    3Condensed Consolidated Statements
of Income (Unaudited)
Three Months and Nine Months Ended
March 31, 2006 and 2005
    
    4Condensed Consolidated Statements of Cash
Flows (Unaudited)
Nine Months Ended March 31, 2006 and 2005
    
    5Notes to Condensed Consolidated Financial
Statements (Unaudited) March 31, 2006
    
    6-9Item 2 Managements Discussion and Analysis of
Financial Condition and Results of Operations
    
    9-11Item 3 Quantitative and Qualitative Disclosures
About Market Risk
    
    12Item 4 Controls and Procedures
    
    13PART II OTHER INFORMATIONItem 1A Risk Factors
    
    13Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
    
    14Item 6 Exhibits
    
    14Rule 13a-14(a)/15d-14(a) Certification of CEO/CFOSection 1350 Certification of CEO/CFO
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##### Table of Contents



PART I
FINANCIAL INFORMATION
 
 Item 1. Financial Statements.
  
  (Unaudited)March 31, 2006
    
    June 30, 2005ASSETSCurrent Assets:Cash
    
    $
    4,864,085
    
    
    $
    5,218,698Accounts receivable
    
    
    8,481,229
    
    
    
    8,763,968Inventories
    
    
    8,946,732
    
    
    
    7,595,803Other current assets
    
    
    1,352,863
    
    
    
    1,987,779Total current assets
    
    
    23,644,909
    
    
    
    23,566,248Property and equipment, net
    
    
    3,073,045
    
    
    
    2,993,700Deferred income taxes
    
    
    315,531
    
    
    
    315,531Other assets
    
    
    2,307,900
    
    
    
    2,365,982$
    29,341,385
    
    
    $
    29,241,461LIABILITIES AND STOCKHOLDERS INVESTMENTCurrent liabilities:Accounts payable
    
    $
    1,678,710
    
    
    $
    3,012,736Accrued liabilities
    
    
    2,679,785
    
    
    
    1,841,862Income taxes
    
    
    768,314
    
    
    
    692,538Dividends payable
    
    
    479,392
    
    
    
    486,918Total current liabilities
    
    
    5,604,489
    
    
    
    6,034,054Deferred compensation
    
    
    961,165
    
    
    
    961,165Derivative liability
    
    
    125,000
    
    
    
    125,000Stockholders investment
    
    
    22,649,019
    
    
    
    22,121,242$
    29,341,385
    
    
    $
    29,241,461
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Three Months
    
    Nine MonthsPeriod Ended March 31
    
    2006
    
    2005
    
    2006
    
    2005Net Sales
    
    $
    13,222,496
    
    
    $
    9,772,686
    
    
    $
    40,607,934
    
    
    $
    28,970,345Cost of goods sold
    
    
    8,266,958
    
    
    
    6,159,205
    
    
    
    24,938,947
    
    
    
    17,975,273Gross Profit
    
    
    4,955,538
    
    
    
    3,613,481
    
    
    
    15,668,987
    
    
    
    10,995,072Selling general and
administrative expense
    
    
    2,615,295
    
    
    
    2,200,546
    
    
    
    7,912,696
    
    
    
    6,776,892Income from operations
    
    
    2,340,243
    
    
    
    1,412,935
    
    
    
    7,756,291
    
    
    
    4,218,180Other income (expense)Royalty income
    
    
    75,000
    
    
    
    21,921
    
    
    
    276,918
    
    
    
    657,991Interest income
    
    
    44,191
    
    
    
    17,563
    
    
    
    119,661
    
    
    
    34,439Interest expense
    
    
    0
    
    
    
    0
    
    
    
    0
    
    
    
    0Income before income tax provision
    
    
    2,459,434
    
    
    
    1,452,419
    
    
    
    8,152,870
    
    
    
    4,910,610Provision for income taxes
    
    
    959,316
    
    
    
    566,443
    
    
    
    3,180,288
    
    
    
    1,915,281Net Income
    
    $
    1,500,118
    
    
    $
    885,976
    
    
    $
    4,972,582
    
    
    $
    2,995,329Earnings per common share:Basic
    
    $
    0.43
    
    
    $
    0.24
    
    
    $
    1.36
    
    
    $
    0.81Diluted
    
    $
    0.40
    
    
    $
    0.23
    
    
    $
    1.32
    
    
    $
    0.76Dividends per common share
    
    $
    0.13
    
    
    $
    0.13
    
    
    $
    0.39
    
    
    $
    0.39
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Nine Months Ended March 31,
    
    2006
    
    2005CASH FLOWS FROM OPERATING
ACTIVITIES:Net income
    
    $
    4,972,582
    
    
    $
    2,995,329Adjustments to reconcile net
income to net cash provided
by operating activities:Depreciation and amortization
    
    
    755,706
    
    
    
    777,574Increase in allowance for doubtful accounts
    
    
    343,000
    
    
    
    Net changes in operating assets and
liabilities
    
    
    (1,185,738
    )
    
    
    3,227,760Net cash provided by operating activities
    
    
    4,885,550
    
    
    
    7,000,663CASH FLOWS FROM INVESTING ACTIVITIES:Acquisition of equipment
    
    
    (795,358
    )
    
    
    (1,026,626
    )Net cash used in investing activities
    
    
    (795,358
    )
    
    
    (1,026,626
    )CASH FLOWS FROM FINANCING ACTIVITIES:Dividends paid
    
    
    (1,445,565
    )
    
    
    (1,440,019
    )Purchase of common stock
    
    
    (6,071,210
    )
    
    
    (2,130,625
    )Exercise of stock options
    
    
    3,071,970
    
    
    
    140,213Net cash used in financing
activities
    
    
    (4,444,805
    )
    
    
    (3,430,431
    )Net (decrease) increase in cash
    
    
    (354,613
    )
    
    
    2,543,606Cash at beginning of period
    
    
    5,218,698
    
    
    
    2,110,917Cash at end of period
    
    $
    4,864,085
    
    
    $
    4,654,523
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1.
    
    CONDENSED CONSOLIDATED FINANCIAL STATEMENTSThe financial statements presented herein are based on interim amounts. In the opinion of
management, all adjustments (consisting of normal recurring accruals) necessary to present
fairly the financial position, results of operations and cash flows at March 31, 2006 and
for all periods presented have been made. All significant intercompany transactions have
been eliminated. The income from operations for the quarter and nine months ended March 31,
2006 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, 2005 Annual Report on Form 10-K.2.
    
    EARNINGS PER COMMON SHAREBasic earnings per common 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 March 31, 2006 and 2005 were 3,528,124 and 3,689,728, respectively. For the
nine months ended March 31, 2006 and 2005, weighted average number of common shares
outstanding were 3,753,223 and 3,829,820, respectively. When dilutive, stock options are
included as share equivalents using the treasury stock method. Common stock equivalents of
195,574 and 85,999 related to stock option grants were included in the computation of the
average number of shares outstanding for diluted earnings per common share for the quarters
ended March 31, 2006 and 2005, respectively. Common stock equivalents of 105,957 and
126,900 related to stock option grants were included in the computation of the average
number of shares outstanding for diluted earnings per common share for the nine months ended
March 31, 2006 and 2005, respectively.3.
    
    INVENTORIESThe classification of inventories is as follows:
 March 31, 2006
    
    June 30, 2005Raw materials and work in process
    
    $
    3,125,080
    
    
    $
    3,649,069Finished goods
    
    
    6,695,045
    
    
    
    4,820,1279,820,125
    
    
    
    8,469,196LIFO reserve
    
    
    (873,393
    )
    
    
    (873,393
    )$
    8,946,732
    
    
    $
    7,595,803
 4.
    
    STOCK PURCHASE AGREEMENTThe Company has an agreement with its Chairman, John C. Koss, to, at the request of the
executor of the estate, repurchase Company common stock from his estate in the event of his
death. The Company does not have the right to require the estate to sell stock to the
Company.
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As such, this arrangement is accounted for as a written put option with the fair value of
the put option recorded as a derivative liability. The fair value of the option at March
31, 2006 was $125,000. The repurchase price is 95% of the fair market value of the common
stock on the date that notice, if the estate elects, to repurchase is provided to the
Company. Under the agreement, the total number of shares to be repurchased will be
sufficient to provide proceeds which are the lesser of $2,500,000 or the amount of estate
taxes and administrative expenses incurred by the Chairmans estate. The Company may elect
to pay the purchase price in cash or may elect to pay cash equal to 25% of the total amount
due and to execute a promissory note for the balance, payable over four years, at the prime
rate of interest. The Company maintains a $1,150,000 life insurance policy to fund a
substantial portion of this obligation. At March 31, 2006 and June 30, 2005, $125,000 has
been classified as a derivative liability on the Companys financial statements.5.
    
    DIVIDENDS DECLAREDOn March 17, 2006, the Company declared a quarterly cash dividend of $0.13 per share for
stockholders of record on March 31, 2006 to be paid April 14, 2006. Such dividend payable
has been recorded at March 31, 2006.6.
    
    STOCK-BASED COMPENSATIONIn 1990, pursuant to the recommendation of the Board of Directors, the stockholders ratified
the creation of the Companys 1990 Flexible Incentive Plan (the 1990 Plan). The 1990 Plan
is administered by a committee of the Board of Directors and provides for the granting of
various stock-based awards including stock options to eligible participants, primarily
officers and certain key employees. A total of 225,000 shares of common stock were
available in the first year of the Plans existence. Each year thereafter additional shares
equal to .25% of the shares outstanding as of the first day of the applicable fiscal year
were reserved for issuance pursuant to the 1990 Plan. On July 22, 1992, the Board of
Directors authorized the reservation of an additional 250,000 shares for the 1990 Plan,
which was approved by the stockholders. In 1993, the Board of Directors authorized the
reservation of an additional 300,000 shares for the 1990 Plan, which was approved by the
stockholders. In 1997, the Board of Directors authorized the reservation of an additional
300,000 shares for the 1990 Plan, which was approved by the stockholders. In 2001, the
Board of Directors authorized the reservation of an additional 300,000 shares for the 1990
Plan, which was also approved by the stockholders. Options generally vest at 25% each
anniversary date after grant, with a maximum term of five to ten years.During December 2004, the Financial Accounting Standards Board (FASB) issued Statement of
Financial Accounting Standards (SFAS) No. 123R, Shared-Based Payments (SFAS 123R),
which changed the accounting for equity compensation programs. Under SFAS 123R, companies
that award share-based payments to employees, including stock options, must begin to
recognize the expense of these awards in the financial statements at the time the employees
receive the awards. As allowed by SFAS 123 and SFAS 148, the Company elected to follow APB
Opinion No. 25 (APB 25) in accounting for its stock option plan until the effective date
of SFAS 123R. The accounting as provided by SFAS 123R was effective for the Company
beginning July 1, 2005, which was the beginning of the Companys current fiscal year. The
adoption of SFAS 123Rs fair value method has an impact on the Companys results of
operations, although it does not have an impact on the overall
financial position. The impact on cash flows from operations is not
material.The effect of applying the expense recognition provisions of SFAS 123R on income before
provision for income taxes, net income and basic and diluted earnings per share for the
three months and the nine months ended March 31, 2006 is presented below:
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ChangeAs
    
    from SFASThree months ended March 31, 2006
    
    Reported
    
    123R
    
    Pro FormaIncome before income tax provision
    
    $
    2,459,434
    
    
    $
    189,013
    
    
    $
    2,648,447Provision for income taxes
    
    
    959,316
    
    
    
    73,715
    
    
    
    1,033,031Net income
    
    
    1,500,118
    
    
    
    115,298
    
    
    
    1,615,416Earnings per share:Basic earnings per share
    
    $
    0.43
    
    
    $
    0.03
    
    
    $
    0.46Diluted earnings per share
    
    $
    0.40
    
    
    $
    0.03
    
    
    $
    0.43
 ChangeAs
    
    from SFASNine months ended March 31, 2006
    
    Reported
    
    123R
    
    Pro FormaIncome before income tax provision
    
    $
    8,152,870
    
    
    $
    386,978
    
    
    $
    8,539,848Provision for income taxes
    
    
    3,180,288
    
    
    
    150,921
    
    
    
    3,331,209Net income
    
    
    4,972,582
    
    
    
    236,057
    
    
    
    5,208,639Earnings per share:Basic earnings per share
    
    $
    1.34
    
    
    $
    0.06
    
    
    $
    1.40Diluted earnings per share
    
    $
    1.32
    
    
    $
    0.06
    
    
    $
    1.38
 The fair value of each option grant was estimated as of the date of grant using the
Black-Scholes pricing model. The resulting compensation cost for fixed awards with graded
vesting schedules was amortized on a straight line basis over the vesting period for the
entire award.As of March 31, 2006, there was approximately $1,035,355 of total unrecognized compensation
cost related to nonvested options granted under the plan. This cost is expected to be
recognized over a weighted average period of 4.83 years.SFAS 123R also requires the benefits of tax deductions in excess of recognized compensation
cost to be reported as financing cash flow, rather than as operating cash flow as required
under the current standards. This requirement reduces the net cash provided by operation
activities and increase the net cash from financing activities in periods after adoption.
The Company cannot estimate what these amounts will be in the future because it will depend
on, among other things, when employees exercise stock options. The effect of applying the
provisions of SFAS 123R on cash flow from operations and cash flow from financing activities
was not material for the three months or the nine months ended March 31, 2006.Prior to fiscal 2006, the Company accounted for its stock-based employee compensation plan
under the recognition and measurement principles of APB 25. All options granted under the
plan had an exercise price equal to the market value of the underlying common stock on the
date of grant. The following table illustrates the effect on net income and earnings per
share if the Company had applied the fair value recognition provisions of SFAS 123R to
stock-based employee compensation, for the three months and the nine months ended March 31,
2005:
 Three Months
    
    Nine MonthsPeriod Ended March 31,
    
    2005
    
    2005Net income, as reported
    
    $
    885,976
    
    
    $
    2,995,329Add: Total stock-based employee compensation recorded
    
    
    26,187
    
    
    
    78,562Deduct: Total stock-based employee compensation
expense determined under fair value based method for
all awards outstanding
    
    
    85,298
    
    
    
    255,894Pro forma net income
    
    $
    826,865
    
    
    $
    2,817,997
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Three Months
    
    Nine MonthsPeriod Ended March 31,
    
    2005
    
    2005Earnings per share:Basic-as reported
    
    $
    0.24
    
    
    $
    0.81Basic-pro forma
    
    $
    0.22
    
    
    $
    0.76Diluted-as reported
    
    $
    0.23
    
    
    $
    0.76Diluted-pro forma
    
    $
    0.22
    
    
    $
    0.71
 7.
    
    SUBSEQUENT EVENTSA dispute has arisen regarding two shipments of products made in November 2005 that were
provided to a former Swedish distributor. The total amount of the products shipped were
approximately $292,000, and the Company has not received any payment yet for these
shipments. The Company is attempting to recover the amounts of goods shipped from the
former Swedish distributor and the freight forwarders, and has initiated certain legal
proceedings to attempt to recover these amounts owed. In the meantime, the Company has
recorded a reserve amounting to $150,000 for potential estimated losses from the amounts
owed from these shipments. This amount is reflected in the condensed consolidated
statements of income for the periods ending March 31, 2006.On May 9, 2006, the Company announced that it will
distribute a special cash dividend of $1.00 per share on
July 15, 2006 to shareholders of record June 30, 2006.
 
 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
 Financial Condition, Liquidity and Capital Resources
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Results of Operations
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Recently Issued Financial Accounting Pronouncements
  11




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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
  
 Item 4. Controls and Procedures.
 (a)
    
    Evaluation of Disclosure Controls and Procedures. The Company maintains a system of
disclosure controls and procedures that are designed to provide reasonable assurance that
information, which is required to be timely disclosed, is accumulated and communicated to
management in a timely fashion. A control system, no matter how well conceived and operated,
can provide only reasonable, not absolute, assurance that the objectives of the control system
are met. The Company, under the supervision and with the participation of the Companys
management, including the Companys Chief Executive Officer/Chief Financial Officer, after
evaluating the effectiveness of the Companys disclosure controls and procedures (as defined
in Rules 13a-15(e) and 15(d)-15(e) of the Securities Exchange Act of 1934, as amended (the
Exchange Act)) as of the end of the period covered by this report, has concluded that the
Companys disclosure controls and procedures are effective to provide reasonable assurance
that information required to be disclosed by the Company in the reports that it files or
submits under the Exchange Act is accumulated and communicated to the Companys management,
including its principal executive officer and principal financial officer, as appropriate to
allow timely decisions regarding required disclosure and are effective to provide reasonable
assurance that such information is recorded, processed, summarized and reported within the
time periods specified in the SECs rules and forms.(b)
    
    Changes in Internal Controls. The Companys internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) is designed to provide reasonable
assurances regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting principles.
There were no changes in the Companys internal control over financial reporting that occurred
during the Companys most recent fiscal quarter that have materially affected, or are
reasonably likely to materially affect, the Companys internal control over financial
reporting. However, because of the inherent limitations in all control systems, no evaluation
of controls can provide absolute assurance that all control issues and instances of fraud, if
any, within the Company have been detected.
 CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
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PART II
 
 Item 1A Risk Factors
  CONSISTENCY
OF THE COMPANYS BUSINESS WITH SEVERAL U.S. RETAILERS
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Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
  COMPANY REPURCHASES OF EQUITY SECURITIES
 Total Number of
    
    Approximate DollarTotal # of
    
    Average
    
    Shares Purchased as
    
    Value ofShares
    
    Price Paid
    
    Part of Publicly
    
    Shares Available underPeriod (2006)
    
    Purchased
    
    per Share
    
    Announced Plan (1)
    
    Repurchase PlanJanuary 1-
    
    
    56,250
    
    
    $
    28.645
    
    
    
    56,250
    
    
    $
    1,327,721January 31February 1-
    
    
    5,736
    
    
    $
    28.25
    
    
    
    5,736
    
    
    $
    1,165,679February 28March 1-
    
    
    8,074
    
    
    $
    26.293
    
    
    
    8,074
    
    
    $
    936,799March 31
 
 
 
 Item 6 Exhibits
 See Exhibit Index attached hereto.
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Signatures
  KOSS CORPORATIONDate:  May 15, 2006
    /s/ Michael J. KossMichael J. KossVice Chairman, President,
Chief Executive Officer,
Chief Financial Officer Date:  May 15, 2006
    /s/ Sue SachdevaSue SachdevaVice PresidentFinance,
Secretary 15




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EXHIBIT INDEX
 Exhibit No.
    
    Exhibit Description3.1
    
    Certificate of Incorporation of Koss Corporation. Filed as Exhibit 3.1 to the
Companys Annual Report on Form 10-K for the year ended June 30, 1996 and
incorporated herein by reference.3.2
    
    By-Laws of Koss Corporation, as in effect on September 25, 1996. Filed as
Exhibit 3.2 to the Companys Annual Report on Form 10-K for the year ended June
30, 1996 and incorporated herein by reference.10.1
    
    Death Benefit Agreement with John C. Koss. Filed as Exhibit 10.4 to the
Companys Annual Report on Form 10-K for the year ended June 30, 1996 and
incorporated herein by reference.10.2
    
    Stock Purchase Agreement with John C. Koss. Filed as Exhibit 10.5 to the
Companys Annual Report on Form 10-K for the year ended June 30, 1996 and
incorporated herein by reference.10.3
    
    Salary Continuation Resolution for John C . Koss. Filed as Exhibit 10.6 to the
Companys Annual Report on Form 10-K for the year ended June 30, 1996 and
incorporated herein by reference.10.4
    
    1983 Incentive Stock Option Plan. Filed as Exhibit 10.7 to the Companys
Annual Report on Form 10-K for the year ended June 30, 1996 and incorporated
herein by reference.10.5
    
    Assignment of Lease to John C. Koss. Filed as Exhibit 10.7 to the Companys
Annual Report on Form 10-K for the year ended June 30, 1988 and incorporated
herein by reference.10.6
    
    Addendum to Lease. Filed as Exhibit 10.8 to the Companys Annual Report on
Form 10-K for the year ended June 30, 1988 and incorporated herein by
reference.10.7
    
    Amendment to Lease. Filed as Exhibit 10.22 to the Companys Annual Report on
Form 10-K for the year ended June 30, 2000 and incorporated herein by
reference.10.8
    
    Partial Assignment, Termination and Modification of Lease. Filed as Exhibit
10.25 to the Companys Annual Report on Form 10-K for the year ended June 30,
2001 and incorporated herein by reference.10.9
    
    Restated Lease. Filed as Exhibit 10.26 to the Companys Annual Report on Form
10-K for the year ended June 30, 2001 and incorporated herein by reference.10.10
    
    1990 Flexible Incentive Plan. Filed as Exhibit 25 to the Companys Annual
Report on Form 10-K for the year ended June 30, 1990 and incorporated herein by
reference.10.11
    
    Consent of Directors (Supplemental Executive Retirement Plan for Michael J.
Koss dated March 7, 1997). Filed as Exhibit 10.2 to the Companys Quarterly
Report on Form 10-Q for the quarter ended March 31, 1997 and incorporated
herein by reference.
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Exhibit No.
    
    Exhibit Description10.12
    
    Loan Agreement, effective as of February 17, 1995. Filed as Exhibit 10 to the
Companys Quarterly Report on Form 10-Q for the quarter ended March 31, 1995
and incorporated herein by reference.10.13
    
    Amendment to Loan Agreement dated June 15, 1995, effective as of February 17,
1995. Filed as Exhibit 10.13 to the Companys Annual Report on Form 10-K for
the year ended June 30, 1995 and incorporated herein by reference.10.14
    
    Amendment to Loan Agreement dated April 29, 1999. Filed as Exhibit 10.14 to
the Companys Annual Report on Form 10-K for the year ended June 30, 1999 and
incorporated herein by reference.10.15
    
    Amendment to Loan Agreement dated December 15, 1999. Filed as Exhibit 10.15 to
the Companys Annual Report on Form 10-K for the year ended June 30, 2000 and
incorporated herein by reference.10.16
    
    Amendment to Loan Agreement dated October 10, 2001. Filed as Exhibit 10.16 to
the Companys Quarterly Report on Form 10-Q for the quarter ended December 31,
2001 and incorporated herein by reference.10.17
    
    License Agreement dated June 30, 1998 between Koss Corporation and Logitech
Electronics Inc. (including Addendum to License Agreement dated June 30, 1998).
Filed as Exhibit 10.18 to the Companys Annual Report on Form 10-K for the
year ended June 30, 1998 and incorporated herein by reference.10.18
    
    Amendment and Extension Agreement between Koss Corporation and Logitech
Electronics Inc. dated May 1, 2001. Filed as Exhibit 10.3 to the Companys
Quarterly Report on Form 10-Q for the quarter ended March 31, 2001 and
incorporated herein by reference.10.19
    
    License Agreement dated June 30, 2003 between Koss Corporation and Sonigem
Products, Inc. Filed as Exhibit 10.19 to the Companys Annual Report on Form
10-K for the year ended June 30, 2005 and incorporated herein by reference.10.20
    
    Amendment to License Agreement dated August 1, 2005, between Koss Corporation
and Sonigem Products, Inc. Filed as Exhibit 10.20 to the Companys Annual
Report on Form 10-K for the year ended June 30, 2005 and incorporated herein by
reference.31.1
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer/Chief
Financial Officer *32.1
    
    Section 1350 Certification of Chief Executive Officer/Chief Financial Officer **
 
 *
    
    Filed herewith**
    
    Furnished herewith 17