Exhibit 10.22.2

 

[APPLETON PAPERS LOGO]

[APPLETON COATED LOGO]

 

Note: The information designated by a bracketed asterisk [*] has been omitted
pursuant to a request for confidential treatment and has been filed separately
with the Securities and Exchange Commission.

 

AMENDMENT OF

MEMORANDUM OF AGREEMENT

YEARS 2004-2005

BASESTOCK SUPPLY AGREEMENT (effective as of June 27, 2001)

 

For valuable consideration, the above-referenced agreement (herein “Agreement”)
shall be and it is hereby amended as follows:

 

1. Section 1., VOLUME/MIX, is amended so as to provide, in its entirety, as
follows:

 

“Except as hereinafter provided, Buyer shall be obligated to purchase from
Seller, and Seller shall be obligated to sell to Buyer, (i) 75,000 tons (2,000
lbs/ton), total, of the grades listed in Schedule 1 of this Amendment, in
Agreement Year 2004 and (ii) 40,000 tons, total, of the grades listed in
Schedule 1 of this amendment, in Agreement Year 2005. The volumes set forth
above are hereinafter referred to as the “Annual Volume(s).”

 

“Buyer’s purchases of the Opaque Grades listed in Schedule 1, shall be limited
to not more than 25% of the Annual Volume in Agreement Year 2004 and 2005.

 

“Except as hereinafter provided or from time-to-time agreed by the parties,
Buyer will purchase and Seller will make available the Annual Volume utilizing a
level load pattern of equal monthly volumes. Adjustments for scheduled “Holiday
Downs” will be planned and agreed to in advance. Buyer shall have the ability to
alter volumes by plus or minus ten percent (10%) per calendar quarter provided
that Buyer shall have given Seller notice, of its intention to alter said
volumes, at least 90 days prior to the beginning of the calendar quarter in
question. Seller will provide any additional tonnage at the same terms as stated
in this Agreement. Each quarterly option of Buyer to alter volumes shall be
limited to plus or minus ten percent (10%). If Buyer does not elect to alter
volumes by plus or minus ten percent (10%) in any given quarter, such option to
elect shall not carry over and/or be available in addition to the 10% volume
alteration option available in the following quarter. If Buyer does elect to
alter volumes by plus or minus ten percent (10%) in any given quarter, Annual
Volume requirements under this Agreement shall be adjusted accordingly.

 

“Additionally, Buyer agrees to purchase product (on or before January 1, 2005),
per section 7 below, required to bring the consignment inventory to 10% of the

--------------------------------------------------------------------------------

Annual Volume agreed to for the 2005 Agreement Year. Any year-end purchases made
by Buyer to adjust the consignment inventory shall be in addition to the Buyer’s
Annual Volume commitment.

 

2. Section 3., Grade Mix, is amended by deleting the last sentence and
substituting the following sentence:

 

“All grades represented in Schedule 1 of this Amendment are considered qualified
grades for purposes of meeting the Annual Volume requirements under this
Agreement.”

 

3. Section 4., Payment Terms, is amended so as to read, in its entirety, as
follows:

 

Terms are two percent (2%) discount if paid via electronic fund transfer to
Seller’s financial institution (if capable), within the time periods specified
in Schedule 3 to this Agreement; otherwise, the discount shall be one percent
(1%) if paid within 20 days from date of invoice, net 30 days. Except as
provided in Section 7 hereof, title shall be deemed transferred at time of
shipment or, as the case may be, release from the “consignment” inventory.

 

4. Section 6., TERM, is amended by deleting the first sentence and substituting
the following two sentences therefor:

 

“This Agreement is effective as of December 28, 2003 and extends for one fiscal
year beyond the current Amendment, thereby ending on January 2, 2006. As
utilized herein, the term “Agreement Year” refers to a fiscal year ending on the
Saturday that is closest to December 31 in the year in question.”

 

5. Section 7., SERVICE, is amended so as to provide in its entirety as follows:

 

“Seller agrees to maintain a consignment inventory of product. Seller will
maintain as Seller’s inventory, a maximum of 7,000 tons in Agreement Year 2004
and 3,500 tons in Agreement Year 2005. Seller will maintain an additional 500
tons of in-transit inventory if required to support Buyers’ Purchase Order due
dates. For the Agreement year 2004, Buyer and Seller will review, on June 1,
2004, the anticipated Annual Volume and reset the consignment inventory maximum
(including “tons in transit”) to be 10% of such anticipated Annual Volume. On
October 1, 2004, Buyer and Seller will review the anticipated Annual Volume for
the 2005 Agreement Year (currently 40,000 tons) and set the 2004 Year end
consignment target to be 10% of the 2005 anticipated Annual Volume. Seller
agrees to utilize Buyer’s leased warehouse space on Radio Road or other mutually
agreed upon site for storage of the consignment inventory. Seller also agrees to
be responsible for the monthly warehouse rental charges for the space utilized
to manage this consignment inventory at a cost not to exceed Buyer’s leased
space rate. Notwithstanding any other provision herein, Product

 

2

--------------------------------------------------------------------------------

within this inventory will be purchased by and title transferred to Buyer,
either when withdrawn from said inventory, or, if not withdrawn, upon reaching
90 days in the consignment inventory.”

 

6. Section 8., ORDER MINIMUMS, is amended so as to provide, in its entirety, as
follows:

 

“Order minimums and run frequencies shall be as specified in Schedule 1 to this
Agreement.”

 

7. Section 9., TRIM, is amended so as to provide, in its entirety, as follows:

 

“All trim charges are established by grade for all grades listed on Schedule 2
of this agreement. Buyer, at time of order, will calculate all applicable trim
charges and will adjust its Purchase Order for said adjustment per the charges
in Schedule 2 of this Agreement.

 

8. Section 10., PRICING, is amended so as to provide, in its entirety, as
follows:

 

“Pricing is per Schedule 1, for Agreement Years 2004 and 2005.

 

9. Section 11., CONTINUOUS COST REDUCTION, is deleted in its entirety; however,
deletion of said section shall not result in or require the renumbering of the
remaining sections of the Agreement .

 

10. Section 12., QUALITY, is amended by changing the first sentence thereof so
as to provide as follows:

 

“All products shall meet or exceed the quality specifications as described in
Buyer’s basestock specification (including basestock finishing specifications)
in effect on January 24, 2003 or thereafter adopted by mutual agreement of the
parties.”

 

11. Section 13., INTERFACES, is changed so as to provide, in its entirety, as
follows:

 

“Issues related to pricing, terms, service issues and other matters arising
hereunder shall be coordinated by Buyer’s—HQ Procurement Specialist (currently
Ed Hammond) and Seller’s Vice President of Logistics and Information Technology
(currently Dan Regal) or his or her designee.”

 

12. Section 17, EXECUTION, is deleted in its entirety; however, deletion of said
section shall not result in or require the renumbering of the remaining sections
of the Agreement.

 

3

--------------------------------------------------------------------------------

13. A new Section, identified as “Section 31, Business Review,” is added, said
new Section, to provide, in its entirety, as follows:

 

“Buyer and Seller agree to conduct a Strategic Business Review annually during
the first calendar quarter of each year of this Agreement

 

14. Schedules, Prior Amendments, and Implied Terms. Schedules 1 through 4 and 7
to the Agreement shall be and they are hereby cancelled and annulled for all
purposes. The Schedules annexed to this Addendum, and identified as “Schedule
1,” “Schedule 2,” and “Schedule 3,” shall be and they are hereby incorporated
herein by reference. Schedules 5 and 6 to the Agreement remain in full force and
effect. References, in the Agreement, to Schedule 2 are hereby deemed amended so
as to refer instead to annexed Schedule 1. All prior amendments to the
Agreement, including that certain “Amendment of Basestock Supply Agreement Dated
June 27, 2001,” shall be and they are hereby cancelled and annulled for all
purposes. Sections of the Agreement that are not referenced in this Amendment
shall be deemed amended, by implication, in order to give effect to the
intention of the parties as set forth in this Amendment.

 

Except as otherwise provided herein, all terms and conditions of the Agreement
shall be and remain in full force and effect.

 

    APPLETON PAPERS INC.   APPLETON COATED LLC

SIGNATURE:

  /s/ Rick Fantini   /s/ Dan Regal    

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

TITLE:

  Vice President   VP Logistics & I.T.    

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

DATE:

  2/25/04   1-27-04    

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

4

--------------------------------------------------------------------------------

2004 Pricing / Making Master Breakout

SCHEDULE 1

 

ALL PRICES LISTED ARE PER HUNDRED WEIGHT PRICING

 

ALL GRADES REQUIRE 24 HOUR MINIMUM RUN LENGTH UNLESS MUTUALLY AGREED TO BETWEEN
AC AND API

 

FOR 61.1, 43.3, AND 50.8 DULL GRADES WE WILL RUN A MINIMUM 12 HOUR RUN PER GRADE
IN A 24 HOUR RUN SCHEDULE

 

ALL PRICES INCLUDE FREIGHT TO DESTINATION IN THE FOX VALLEY

 

--------------------------------------------------------------------------------

      Grade Description:   

#6 PM

MM#

  

#7 PM

MM#

   2004 /2005
Pricing:      

--------------------------------------------------------------------------------

      Group #1 Grades Mfg’ed in 2003                

26.2# White NSST

   3132    9430    [ * ]      

46.5# Wh OBA Ctg Base

   —    8018           

28.0# Wh Hi-Strength Base

   —    8020           

61.1# White OBA Base

   —    8089           

37.8# Wh Integra Ctg Base

   8119    8395           

30.2# CN PRCT

   8386    8248           

26.25# WH Hi-Strength

   —    8452           

26.2# CN ST Base

   8025    8075           

43.3# Dull Label Base

   —    8457           

31.1# WH THRML Fax

   —    8081           

34# WH OPAQUE Base

   8467    8466           

30.5# WH OPAQUE Base

   9238    9643           

34# WH OBA Base #7

   —    8321           

43.3# WH LBL Base

   —    8907           

61.1# WH NO OBA (DULL)

   —    9774           

50.8# WH NO OBA (DULL)

   9980    9115           

31.1# WH THRML FAX (CFS Back)

   —    9750          Eff. 3/1/04                       

--------------------------------------------------------------------------------

      Grade Description:   

#6 PM

MM#

  

#7 PM

MM#

   2004
Pricing:      

--------------------------------------------------------------------------------

      Group #2 Grades Mfg’ed Prior to 2003                     

33# WH ST CTG Base

   8238    —    [ * ]      

30.20 PK PRCT

   8390    8264           

26.8# Pink Superior

   8296    —           

26.8# Green Superior

   8318    —           

26.8# Gold Superior

   8328    —           

26.8# Blue Superior

   8370    —           

26.25# WH Histrgth HBNT NO OBA

   —    8452           

26.2# WH RST30 CTG Base

   8065    —           

30.9# WH RST30 Ctg Base

   8066    —           

27.1# PJK Premium Base

   8103    —           

26.8# Canary Superior Base

   8276    —           

26.8# WH Superior Base

   —    —           

26.8# WH For Sprint CFB Base

   —    —           

30.2# White For PRCT

   8392    8245           

38# WH OPAQUE Base

   —    9268           

 

5

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

Grade Description:   

#6 PM

MM#

  

#7 PM

MM#

   2004
    Pricing:    

--------------------------------------------------------------------------------

Group 3 Grades Eliminated               

26.25# WH CTG BS NO OBA

   8031          

29.9# WHT PRCT

   8041          

28.3# WH Ultimark

   8077          

27.1# CN PREM

   8113          

30.1# WH HI-BLK

   8140          

30.9# WH ST

   8216          

29.9# CAN PRECT

   8387          

30.2# WH PRECT

   8392          

29.9# OK PRECT

   8394          

39.5# WH ST

   8420          

29.9# CAN PRECT

   8423          

29.9# PK PRECT

   8424          

27.8# WH SCCB HI-STRGTH

   9041          

27.1# PK PRM HI-STRNGTH

   9077          

28.3# ULTMK HI-STRNGTH

   9229          

30.1# WH OPAQUE

   9323          

40# WH OPAQUE

   9639          

30.9# WH ST

   9429          

26.2# WH ST

   9430          

38.1# PREM PRECT WH

   9455          

 

6

--------------------------------------------------------------------------------

[Appleton Logo]

 

Appleton Ideas Basestock Trim Upcharge Guidelines

 

SCHEDULE 2

    Red denotes grades not on API’s list.   2002

--------------------------------------------------------------------------------

  2003

--------------------------------------------------------------------------------

  2004

--------------------------------------------------------------------------------

  2004

--------------------------------------------------------------------------------

  2004

--------------------------------------------------------------------------------

 

2004 Trim Adjusted Pricing

(Inches of Variance from 2002/2003 Weighted Average)

--------------------------------------------------------------------------------

Product
Family

--------------------------------------------------------------------------------

  MM

--------------------------------------------------------------------------------

  Mach

--------------------------------------------------------------------------------

  BW

--------------------------------------------------------------------------------

 

Description

--------------------------------------------------------------------------------

  2002
Actual
Trim

--------------------------------------------------------------------------------

  2002
Actual
Tons

--------------------------------------------------------------------------------

  Actual
Trim
(thru
SEP)

--------------------------------------------------------------------------------

  Actual
Tons
(thru
SEP)

--------------------------------------------------------------------------------

  Average
Trim
Standard

--------------------------------------------------------------------------------

  $/Ton/
Inch
Trim
Penalty

--------------------------------------------------------------------------------

  Base
Price

--------------------------------------------------------------------------------

  0”-1”

--------------------------------------------------------------------------------

  1”-2”

--------------------------------------------------------------------------------

  2”-3”

--------------------------------------------------------------------------------

  3”-4”

--------------------------------------------------------------------------------

  4”-5”

--------------------------------------------------------------------------------

  5”-6”

--------------------------------------------------------------------------------

  6”-7”

--------------------------------------------------------------------------------

  7”-8”

--------------------------------------------------------------------------------

  8”-9”

--------------------------------------------------------------------------------

  9”-10”

--------------------------------------------------------------------------------

C

  9572/8075   7   26.2   CAN ST Base   209.11   1,607   198.10   365   198.10  
[    *    ]   [    *    ]   [    *    ]   [    *    ]   [    *    ]  
[    *    ]   [    *    ]   [    *    ]   [    *    ]   [    *    ]  
[    *    ]   [    *    ]

C

  9563/8025   6   26.2   CAN ST Base   214.70   1,015   207.60   374   198.10  
                                             

C

  3132   6   26.2   WH ST BS-CM   211.24   797   216.43   340   216.43          
                                     

C

  9153/8452   7   26.25   WH Hbt Nonoba Histgth   214.59   4,412   217.91  
4,005   217.91                                                

C

  8020   7   28   WH SCCB Base   201.77   2,408   199.15   1,848   199.15      
                                         

C

  8248   7   30.2   CAN Precoat Premium   213.00   1,765   0   0   213.00      
                                         

C

  8386   6   30.2   CAN Precoat Premium   217.20   588   213.76   2,680   213.76
                                               

C

  8321   7   34   WH Base   212.04   189   213.11   192   213.11                
                               

C

  8395   7   37.8   WH Integra Base   207.25   14   0   0   207.25              
                                 

C

  8119   6   37.8   WH Integra Base   217.73   538   219.31   792   219.31      
                                         

C

  8264   7   30.2   PK Precoat Premium   223.50   345   —     0   223.50        
                                       

C

  8390   6   30.2   PK Precoat Premium   213.00   732   —     0   213.00        
                                       

C

  8296   6   26.8   Pink   213.00   870   —     0   213.00                      
                         

C

  8318   6   26.8   Green   213.00   480   —     0   213.00                    
                           

C

  8328   6   26.8   Gold   213.00   538   —     0   213.00                      
                         

C

  8370   6   26.8   Blue   213.65   895   —     0   213.65                      
                         

C

  8065   6   26.2   Wh RST 30 Ctg Bs   215.51   160   —     0   215.51          
                                     

C

  8066   6   30.9   Wh RST 30 Ctg Bs   215.70   304   —     0   215.70          
                                     

C

  8103   6   27.1   Pink Premium   —     0   —     0   214.00                  
                             

C

  8276   6   26.8   Canary   —     0   —     0   214.00                        
                       

C

  8371   7   26.8   White   —     0   —     0   214.00                          
                     

C

  9078   7   26.8   Pink Histgth   —     0   —     0   214.00                  
                             

C

  8265   6   26.8   Wh For Sprint   —     0   —     0   214.00                  
                             

C

  8245   7   30.2   Wh Precoat   —     0   —     0   214.00                    
                           

C

  8238   6   33   White ST Base   220.50   127   —     0   220.50              
                                 

O

  9643   7   30.5   WH Opaque Base   221.00   8   218.83   4,669   218.83      
                                         

O

  9238/8891   6   30.5   WH Converter Base   218.04   2,143   216.73   2,811  
216.73                                                

O

  9322/8467   6   34   WH Opaque Base   201.48   1,893   201.59   3,278   201.59
                                               

O

  9641/8466   7   34   WH Opaque Base   198.68   533   202.71   2,173   202.71  
                                             

O

  9115   7   50.8   White Dull   —     0           206.00                      
                         

O

  9980   6   50.8   White Dull   —     0           206.00                      
                         

T

  8081   7   31.1   WH Thermal Fax Base   209.99   27,332   209.18   18,283  
209.18                                                

T

  9857/8457   7   43.3   WH Label Base OBA   215.25   209   219.02   1,638  
217.00                                                

T

  8907   7   43.3   WH Label Base OBA   219.09   21,604   217.57   16,485  
217.57                                                

T

  8018   7   46.5   WH Ctg Base OBA   212.82   891   212.14   794   212.14      
                                         

T

  8018   7   46.5   WH Ctg Base OBA   212.82   3,106   212.14   3,403   212.14  
                                             

T

  8089   7   61.1   WH Base OBA   214.88   857   215.14   773   215.14          
                                     

T

  9750   7   31.1   New Back Coat (CFS Ctg)   —     0           210.00          
                                     

T

  8774   7   61.1   White Dull   —     0           215.00                      
                         

--------------------------------------------------------------------------------

SCHEDULE 3

 

 

PAYMENT TERMS

 

 

ACTUAL

USAGE

DATE

--------------------------------------------------------------------------------

 

AC

INVOICE

DATE

--------------------------------------------------------------------------------

 

API

VOUCHER

DATE

--------------------------------------------------------------------------------

 

AC

DUE

DATE

--------------------------------------------------------------------------------

 

API

EFT

DATE

--------------------------------------------------------------------------------

 

AC

RECEIPT

OF CASH

--------------------------------------------------------------------------------

 

BUSINESS DAYS

--------------------------------------------------------------------------------

MON

  MON   TUE   FRI   FRI   MON   5

TUE

  TUE   WED   MON   FRI   MON   4

WED

  WED   THU   TUE   FRI   MON   3

THU

  THU   FRI   WED   TUE   WED   4

FR/SAT/SU

  SUN   MON   THU   TUE   WED   3