- 7 -
specified in paragraphs (1) * * * until the total
amount of $300,000 is paid. In computing payment from
year to year, the amount remaining due at the end of
each year will be adjusted according to the inflation
rate so that it will reflect the dollar value in the
year 1977. * * *
* * * * * * *
3. This agreement shall remain in force until all
of said U.S. and foreign patents expire or until the
payments have been made in full, whichever occurs
first.
4. * * * Quarterly, within thirty days after the
first days of January, April, July, and October of each
year during the continuance of this agreement, Cascade
Designs, Inc. shall render writting [sic] reports to
James M. Lea, stating in each report the quantities and
net selling prices of all air mattresses sold by
Cascade Designs, Inc. during the preceding three
calendar months. Each such report shall be accompanied
by remittance in full covering the payments shown
thereby to be due James M. Lea.
* * * * * * *
6. If Cascade Designs, Inc. fails to pay James M.
Lea the moneys payable under the terms of this
agreement, or fails to keep or perform any other
obligation of the agreement, then James M. Lea may, at
his option terminate this agreement by giving sixty
days written notice, specifying the default complained
of; provided, however, that if Cascade Designs, Inc.
shall, within such sixty days, cure the default
complained of, then the notice shall cease to be
operative and this agreement shall continue on [sic]
full force and effect as though such default had not
occurred; and provided further, that if Cascade Designs
shall within such sixty days notify James M. Lea in
writing that it disputes the asserted default, the
matter shall be submitted to arbitration as hereinafter
provided.
The patent and patent applications covered by the 1979 sales
agreement, except the 690 patent, were officially assigned by Lea
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