Exhibit 10.2

 

AMENDMENT

TO

PURCHASE AGREEMENT

 

This Amendment to Purchase Agreement is made and entered into as of the 11th day
of June, 2004 by and among ARJO WIGGINS US HOLDINGS LTD., a corporation formed
under the laws of England and Wales (“Seller 1”), ARJO WIGGINS NORTH AMERICA
INVESTMENTS LTD., a corporation formed under the laws of England and Wales
(“Seller 2,” and together with Seller 1, “Sellers”), ARJO WIGGINS APPLETON LTD.
(f/k/a Arjo Wiggins Appleton p.l.c.), a corporation formed under the laws of
England and Wales (“Seller Parent”), PAPERWEIGHT DEVELOPMENT CORP., a Wisconsin
corporation (“Buyer 1”), and NEW APPLETON LLC, a Wisconsin limited liability
company wholly-owned by Buyer 1 (“Buyer 2,” and together with Buyer 1,
“Buyers”).

 

W I T N E S S E T H:

 

WHEREAS, Sellers, Seller Parent and Buyers are parties to that certain Purchase
Agreement dated as of July 5, 2001 (the “Original Agreement”); and

 

WHEREAS, effective as of 11:59 P.M. on December 7, 2001, Buyer 2 was liquidated
and dissolved and all of Buyer 2’s right, title and interest in and under its
contracts and agreements, including the Original Agreement, were assigned to
Buyer 1 and Buyer 1 assumed and agreed to perform all of Buyer 2’s obligations
under the assigned contracts and agreements, including the Original Agreement;
and

 

WHEREAS, Sellers, Seller Parent and Buyers desire to amend the Original
Agreement in accordance with and subject to the terms and conditions herein set
forth.

 

NOW, THEREFORE, the parties hereto agree as follows:

 

1. References; Defined Terms. All capitalized terms used herein and not
otherwise defined shall have the meaning given such terms in the Original
Agreement and all references to sections herein are references to sections of
the Original Agreement. All references to the Original Agreement contained
herein shall mean the Original Agreement as amended hereby.

 

2. Purchase Price. Section 2.2 of the Original Agreement shall be deleted in its
entirety and the following inserted in lieu thereof:

 

The aggregate purchase price (the “Purchase Price”) for the Partnership
Interests shall be (i) $837,066,667 plus (ii) the Harrisburg Proceeds minus
(iii) the amount of Appleton Debt on the Closing Date.

 

3. Deferred Payment. Section 2.3(b) of the Original Agreement shall be deleted
in its entirety and the following inserted in lieu thereof:

 

Buyer 1 shall make a payment to Seller 1 of $167,066,667 on June 11, 2004.

 

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For the avoidance of doubt, the parties hereto agree that by making such
payment, the Deferred Payment shall be satisfied in full and all operative
provisions of Schedule 2.3 shall be terminated and of no further force or
effect. By accepting such payment, Sellers and Seller Parent hereby waive notice
of prepayment of the Deferred Payment.

 

4. Tax Returns and Elections. Section 5.8(b)(iv) of the Original Agreement shall
be deleted in its entirety and the following inserted in lieu thereof:

 

(iv) Buyer 1 shall submit to Sellers or their designee (their “Tax Designee”)
any tax return to be prepared (or caused to be prepared) by it or any Purchased
Entity with respect to which Sellers have or may have any liability at least
thirty (30) days prior to the date on which such tax return is due (including
extensions) and shall make available to Sellers and Sellers’ Tax Designee such
of its personnel and tax records as may be requested by Sellers and Sellers’ Tax
Designee in order to allow a reasonable review thereof and the bases therefor;
and Sellers and Sellers’ Tax Designee shall provide Buyer 1 with any objections
thereto not less than ten (10) days prior to the date on which such tax return
is due (including extensions).

 

5. Tax Indemnity; Tax Refunds. Section 5.9 of the Original Agreement of the
Original Agreement shall be deleted in its entirety and the following inserted
in lieu thereof:

 

[Intentionally left blank.]

 

6. Section 8.1(a)(i) . Section 8.1(a)(i) of the Original Agreement shall be
deleted in its entirety and the following inserted in lieu thereof:

 

(i) Subject to the limitations provided herein, Sellers and Seller Parent shall,
jointly and severally, indemnify and hold harmless Buyers to the extent set
forth in this Section 8 in respect of any Losses reasonably and proximately
incurred by any Buyer or any of its Affiliates (collectively, the “Buyer
Indemnitees”) (A) as a result of any inaccuracy or misrepresentation in or
breach of or failure to perform the representation and warranty set forth in
Section 3.16 of this Agreement, (B) in connection with any Excluded Operations
Liability to the extent relating to Environmental Laws, Environmental Claims,
Environmental Permits, Hazardous Substances or any Liability relating to any
environmental matters (collectively, “Excluded Operations Environmental
Liabilities”), or (C) in connection with those Other Excluded Liabilities
identified in Section B (Identified Environmental) of Schedule 1.2(c). The
indemnity obligations of Sellers and Seller Parent for Losses reasonably and
proximately incurred by any of the Buyer Indemnities in respect of clauses (A),
(B) and/or (C), above, shall be collectively referred to herein as the
“Remaining Indemnity Obligations.” In the case of clauses (B) and (C) in the
foregoing sentence, the Sellers’ and Seller Parent’s obligations to indemnify
the Buyers are absolute notwithstanding any disclosures set forth in the
Schedules hereto.

 

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7. Section 8.1(a)(ii). Section 8.1(a)(ii) of the Original Agreement shall be
deleted in its entirety and the following inserted in lieu thereof:

 

(ii) Notwithstanding the foregoing, the sole recourse of the Buyer Indemnitees
for any Losses resulting from, relating to or arising in connection with any Fox
River Liability shall be pursuant to the Fox River Indemnification Agreements.

 

8. Section 8.1(a)(v). Section 8.1(a)(v) of the Original Agreement shall be
deleted in its entirety and the following inserted in lieu thereof:

 

(v) (A) Except as set forth in subsection (B), below, the aggregate collective
liability of Sellers and Seller Parent for Losses under Section 8.1 of this
Agreement shall not exceed $93,000,000 (the “Maximum Amount”).

 

(B) The Maximum Amount shall not apply to the obligations of Sellers and Seller
Parent under or in connection with (x) Excluded Operations Environmental
Liabilities, or (y) the Fox River Indemnification Agreements, as to all of which
there shall be no limit on the obligations of Sellers and Seller Parent.

 

For the avoidance of doubt, the parties hereto agree that any calculation of
Losses for purposes of determining whether the Maximum Amount has been reached
from and after the date of this Amendment shall include all Losses actually paid
by Sellers or Seller Parent pursuant to Section 5.9 or Article 8 of the Original
Agreement as a result of indemnification claims made by the Buyers from and
after the Closing Date.

 

9. Section 8.2.(b). Section 8.2(b) of the Original Agreement shall be deleted in
its entirety and the following inserted in lieu thereof:

 

(b) Notwithstanding Section 8.2(a), the representations and warranties of
Sellers shall survive the Closing Date until the expiration of any applicable
statute of limitations, including extensions thereof, with respect to any
inaccuracy or misrepresentation in or breach of any representation or warranty
made in Section 3.16.

 

Any cause of action for breach of a representation or warranty contained herein
shall expire and terminate unless the party claiming that such breach occurred
delivers to the other party written notice and a reasonably detailed explanation
of the alleged breach on or before 5:00 P.M., London time, on the date on which
such representation or warranty expires pursuant to this Section 8.2.

 

10. Section 8.4(d). Section 8.4(d) of the Original Agreement shall be deleted in
its entirety and the following inserted in lieu thereof:

 

(d) Notwithstanding anything contained in this Section 8 to the contrary, the
defense of any Third Party Claim relating to Fox River Liabilities

 

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shall be resolved solely in accordance with the Fox River Indemnification
Agreements.

 

11. Right of Set-Off. Section 8.6 of the Original Agreement shall be deleted in
its entirety and the following inserted in lieu thereof:

 

[Intentionally left blank.]

 

12. Security. Section 8.7 of the Original Agreement shall be deleted in its
entirety and the following inserted in lieu thereof:

 

[Intentionally left blank.]

 

13. Exclusive Remedy. Section 8.8 of the Original Agreement shall be deleted in
its entirety and the following inserted in lieu thereof:

 

Except as otherwise provided herein, the indemnification provisions in Section 8
of this Agreement shall provide the sole and exclusive remedy of the parties
hereto, their Affiliates, and any of their officers, directors, employees,
stockholders, agents and representatives with respect to any and all Losses of
any kind or nature whatever incurred because of or resulting from or arising out
of this Agreement, the transactions contemplated hereby, the Business, and the
Purchased Entities and any of their assets and liabilities (other than Losses to
the extent resulting from Fox River Liabilities (for which the sole recourse of
Buyers, their Affiliates and any of their officers, directors, employees,
stockholders, agents and representatives shall be pursuant to the Fox River
Indemnification Agreements)). In furtherance of the foregoing, each party hereby
waives, on its own behalf and on behalf of its Affiliates and of any of their
officers, directors, employees, stockholders, agents and representatives, to the
fullest extent permitted under applicable law, any and all rights, claims and
causes of action any of them may now or hereafter have against the other party
and its Affiliates and their officers, directors, employees, stockholders,
agents and representatives, arising under or based upon any federal, state,
local or foreign statute, law, ordinance, rule or regulation (including without
limitation any such rights, claims and causes of action relating to
Environmental Law or arising under or based upon common law) or otherwise
(except pursuant to Section 8 of this Agreement).

 

14. Seller Parent Guarantee. Section 12 of the Original Agreement shall be
deleted in its entirety and the following inserted in lieu thereof:

 

Seller Parent hereby unconditionally and absolutely guarantees to Buyers the
prompt and full payment and performance of all covenants, agreements and other
obligations of Sellers hereunder, including but not limited to all of Sellers’
indemnification obligations pursuant to Section 8. The foregoing guarantee shall
be direct, absolute, irrevocable and unconditional and shall not be impaired
irrespective of any modification, release, supplement, extension or other change
in the terms of all or any of the obligations of Sellers hereunder or for any
other reason whatsoever. Seller Parent hereby waives any requirement of
promptness,

 

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diligence or notice with respect to the foregoing guaranty and any requirement
that Buyers exhaust any right or take any action against Sellers in respect of
any of their obligations hereunder.

 

15. No Other Indemnities. The parties hereto acknowledge and agree that, except
for the Remaining Indemnity Obligations, all indemnification obligations of
Seller Parent and Sellers pursuant to Sections 5.9 and 8.1 of the Original
Agreement are hereby terminated and released and shall be of no further force
and effect. Notwithstanding the foregoing, Seller Parent and Sellers shall be
responsible for and be obligated to pay and/or satisfy (subject to the terms and
conditions of the Original Agreement prior to the Effective Date) all Losses
incurred prior to 11:59 p.m. (eastern time) on June 2, 2004 (the “Indemnity
Claims Time”), including, without limitation, Losses for which claims have been
made, or invoices or statements of account have been submitted to the Sellers
and/or Seller Parent, by Buyers or Appleton prior to the Indemnity Claims Time,
and Buyers shall be responsible for and obligated to pay and/or satisfy all
Losses incurred after the Indemnity Claims Time with respect to all matters
other than those relating to the Remaining Indemnity Obligations.

 

16. Roaring Spring Water Supply. Buyer 1 covenants and agrees with the Sellers
that it will, and will cause Appleton to, use its best efforts to avoid
disruptions to the water supply to Appleton’s mill located in Roaring Spring,
Pennsylvania as a result of the activities of New Enterprise Stone and Lime Co.
or any of its successors. The parties hereto acknowledge and agree that from and
after the date hereof, Seller 1 shall have no further obligation to pay or
reimburse Appleton for one-half of the legal fees and expenses being incurred in
connection with challenging New Enterprise’s Noncoal Surface Mining Permit
revisions, which affect such water supply; provided, however, that the
elimination of such obligation shall not have any impact on the indemnity
obligations of Sellers and Seller Parent with respect to Item No. 7 of Section B
of Schedule 1.2(c).

 

17. Effective Date. This Amendment shall be effective on the date hereof
(“Effective Date”) when each of the following shall have been executed and
delivered by the parties hereto, all of which are conditions to the
effectiveness of this Amendment:

 

(a) This Amendment shall have been executed and delivered by the parties hereto.

 

(b) The appropriate parties shall have executed an Amended and Restated
Relationship Agreement (the “Amended Relationship Agreement”) in form and
substance reasonably satisfactory to the Sellers, Seller Parent and Buyers.

 

(c) Amendments to the Fox River Indemnification Agreements shall have been
executed and delivered by the parties thereto in form and substance reasonably
satisfactory to Sellers, Seller Parent and Buyers.

 

(d) An amendment and endorsement to that certain Indemnity Claim Insurance
Policy No. 529 5316 (the “Policy”) issued by Commerce Industry Insurance Company
in favor of Arjo Wiggins Appleton (Bermuda) Limited (“Bermuda”) shall have been
executed by the appropriate parties thereto and shall have become effective.

 

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(e) The Trustee under the Indenture pursuant to which Appleton’s 12½% Senior
Subordinated Notes due 2008, and the Administrative Agent under that certain
Credit Agreement dated as of November 9, 2001, as amended through the date
hereof, to which Appleton, PDC and certain banks and other financial
institutions are parties, shall have consented to the Amended Relationship
Agreement and the amendment of and endorsement to the Policy.

 

(f) Seller 1 and Seller Parent shall have executed a payoff letter with respect
to the satisfaction of the Deferred Payment and Buyer 1 and Appleton shall have
accepted and agreed to such payoff letter.

 

(g) Buyer 1 shall have made the payment required by Section 2.3(b) to Seller 1
by wire transfer of immediately available funds to an account designated by
Seller 1 prior to the Effective Date.

 

(h) Seller 1 shall execute and deliver to Buyer 1 an acknowledgement of the
receipt of the funds referred to in (g), above.

 

18. Miscellaneous.

 

(a) Representations and Warranties. The parties hereto represent and warrant to
each other that this Amendment has been duly authorized by all requisite
corporate, limited liability company or other action prior to the date hereof
and each of the parties hereto have full power and authority to execute and
deliver this Amendment and perform its obligations hereunder. This Amendment has
been duly executed and delivered by each of the parties hereto and constitutes a
valid and legally binding obligation of each of the parties hereto.

 

(b) Binding Agreement; Assignment. This Amendment shall be binding upon and
inure to the benefit of the parties named herein and to their respective
successors and assigns.

 

(c) Amendments and Waivers. Any change or amendment hereto or any waiver
hereunder must be in writing and signed by the party or parties against whom
such change, amendment or waiver is sought to be enforced.

 

(d) Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of New York.

 

(e) Counterparts. This Amendment may be executed in one or more counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.

 

(f) No Other Amendment. Except as specifically provided herein, the Original
Agreement shall remain in full force and effect.

 

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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amendment to Purchase Agreement as of the day and year first written above.

 

ARJO WIGGINS US HOLDINGS LTD.

By:

 

/s/ Christopher Gower

   

Name: Christopher Gower

   

Title: Authorized Signatory

ARJO WIGGINS NORTH AMERICA
INVESTMENTS LTD.

By:

 

/s/ Vincent Favier

   

Name: Vincent Favier

   

Title: Authorized Signatory

ARJO WIGGINS APPLETON LTD.

By:

 

/s/ Vincent Favier

   

Name: Vincent Favier

   

Title: Authorized Signatory

PAPERWEIGHT DEVELOPMENT CORP.

By:

 

/s/ Dale E. Parker

   

Dale E. Parker, Chief Financial Officer and

Treasurer

NEW APPLETON LLC

By:

 

Paperweight Development Corp., successor in

interest

By:

 

/s/ Dale E. Parker

   

Dale E. Parker, Chief Financial Officer and

Treasurer

 

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