Exhibit 4.7


 


EXECUTION
VERSION


 


FIRST AMENDMENT TO FORBEARANCE AGREEMENT


 


This
First Amendment to Forbearance Agreement (this “Agreement”), dated as of
May 14, 2008, amends that certain Forbearance Agreement dated as of April 30,
2008 (the “Existing Forbearance Agreement”) and is entered into by and
among Vertis, Inc. (the “Issuer”), each of the undersigned entities
listed as guarantors (collectively, the “Guarantors”), each of the
undersigned holders (collectively, the “Initial Forbearing Holders”) of
the 9.75% Senior Secured Second Lien Notes due 2009 (the “Notes”) issued
by the Issuer that is a signatory to the Existing Forbearance Agreement and
certain other holders of the Notes (the “Additional Holders,” and
together with the Initial Forbearing Holders, the “Holders”).  Each capitalized term used herein and not otherwise
defined herein shall have the meaning attributed to such term in the Existing
Forbearance Agreement.


 


W I T N E S S E T H:


 


WHEREAS, on April 30, 2008, the
Issuer, the Guarantors and the Initial Forbearing Holders entered into the
Existing Forbearance Agreement, pursuant to which such holders agreed to
forbear during the Forbearance Period from exercising their rights and remedies
under the Indenture and from directing the Trustee to exercise any such rights
and remedies on their behalf resulting from the Existing Default and the
Payment Default; and


 


WHEREAS, the failure of the
Restructuring Agreement Execution to occur on or before 5:00 p.m. (New
York time) on May 13, 2008 (the “Restructuring Execution Deadline”)
resulted in a Forbearance Termination Event under the Existing Forbearance
Agreement; and


 


WHEREAS, due to the ongoing
discussions among the parties with respect to the Restructuring Agreement, the
Issuer and the Guarantors have requested that the Holders continue their
forbearance with respect to the Payment Default and the Existing Default by
waiving the aforementioned Forbearance Termination Event and extending the
Restructuring Execution Deadline; and


 


WHEREAS, subject to the terms and
conditions set forth herein, the Additional Holders have agreed to be bound by
the terms of the Existing Forbearance Agreement, as amended hereby and the
Holders have agreed to continue their forbearance and extend the Restructuring
Execution Deadline to 5:00 p.m. (New York time) on May 20, 2008.


 


NOW, THEREFORE, in consideration of the
mutual covenants set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:


 


SECTION 1.  Waiver of Forbearance Termination Event.  The Holders hereby waive the Forbearance
Termination Event occurring under the Existing Forbearance Agreement as a
result of the failure of the Restructuring Agreement Execution to occur on or
before 5:00 p.m. (New York time) on May 13, 2008.


 


SECTION 2.  Amendment to Existing Forbearance Agreement. The following
clauses of the definition of Forbearance Termination Event in Section 1 of
the Existing Forbearance Agreement shall be hereby amended as follows:


 

















 


(1) clause (a) is hereby amended to
read: “(a) the failure of the Restructuring Agreement Execution to occur
on or before 5:00 p.m. (New York time) on May 20, 2008;”;


 


(2) clause (e) is hereby amended to
read: “(e) the occurrence of a Default or Event of Default under the
Indenture other than the Existing Default, the Payment Default or an Event of
Default under Section 6.1(d) of the Indenture due to an acceleration
of the Issuer’s 13.5%
Senior Subordinated Notes due 2009 arising from the failure of the Issuer and/or the Guarantors to pay
interest thereon;”; and


 


(3) clause (f) is hereby amended to
read: “(f) the
failure of the Issuer and/or the Guarantors to comply with any term, condition,
representation or covenant contained in this Agreement, or any amendment
hereto.”


 


SECTION 3.  Amendment Fee.  In consideration for the agreements reflected
herein, the Issuer shall deliver by wire transfer, on or before 5:00 p.m.
on May 14, 2008, the sum of $75,000 (the “Amendment Fee”) to the
law firm of Stroock & Stroock & Lavan LLP (“Stroock”)
on behalf of the Holders.  Stroock shall
then promptly distribute the Amendment Fee to the Holders pro rata according to their holdings of
Notes as a percentage of the aggregate principal amount of Notes held by all
Holders.


 


SECTION 4.  Conditions to Effectiveness.  The effectiveness of this Agreement shall be
subject to the satisfaction of each of the following conditions:


 


(a)           Holders representing in the aggregate
more than 75% of the outstanding principal amount of the Notes shall have
executed this Agreement;


 


(b)           the Holders shall have received from
the Issuer a duly executed counterpart of this Agreement from each Holder, the
Issuer and each Guarantor listed on the signature pages hereto;  provided,
however, that signature pages executed by Holders shall be
delivered to (a) other Holders in a redacted form that removes such Holder’s
holdings of the Notes and (b) the Issuer, the Guarantors and advisors to
the Holders in an unredacted form; provided
further, however, that the advisors to the Holders shall not
disclose the unredacted signature pages to any Holder.


 


(c)           (i) all representations and
warranties made by the Issuer and the Guarantors in the Indenture, the Note and
the Security Documents shall be true and correct in all material respects on
and as of the effective date of this Agreement as though made on and as of such
date (unless any such representation or warranty relates solely to an earlier
date, in which case it shall have been true and correct in all material
respects as of such earlier date); and (ii) no Default or Event of Default
(except with respect to the Existing Default and the Payment Default) has
occurred or is continuing as of the effective date of this Agreement; and


 


(d)           the Issuer shall have delivered the
Amendment Fee in accordance with Section 3 hereof.


 


SECTION 5.  Agreement to be Bound.  Subject to Section 4
hereof, the undersigned Holders hereby severally agree to be bound by the
Existing Forbearance Agreement, as amended hereby and the undersigned
Additional Holders shall also be deemed to be “Holders” thereunder.


 


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SECTION 6.  Representation of the Holders.  Each Holder severally
represents that it is the beneficial owner and/or investment advisor or manager
of discretionary accounts for the holders or beneficial owners of the aggregate
principal amount of the Notes set forth on the signature page hereof
beneath its name.


 


SECTION 7.  Reference to and Effect Upon the
Existing Forbearance Agreement.


 


(a)           Except as specifically amended hereby, all terms,
conditions, covenants, representations and warranties contained in the Existing
Forbearance Agreement, as amended hereby, and all rights and obligations of the
Issuer, Guarantors and Holders therein, shall remain in full force and
effect.  Each of the Issuer, Guarantors
and Holders hereby confirms that the Existing Forbearance Agreement, as amended
hereby is in full force and effect and that none of the Issuer, Guarantors and
Holders has any defenses, setoffs, recoupments, offsets, claims or
counterclaims to the obligations under the Existing Forbearance Agreement, as
amended hereby.


 


(b)           Except as expressly set forth herein, the execution,
delivery and effectiveness of this Agreement shall not directly or indirectly (i) create
any obligation to continue to defer any enforcement action after a Default or
Event of Default, (ii) constitute a consent or waiver of any past, present
or future violations of any provisions of the Existing Forbearance Agreement,
as amended hereby or (iii) amend, modify or operate as a waiver of any
provision of the Existing Forbearance Agreement, as amended hereby. Except as
expressly set forth herein, each of Issuer, Guarantors and Holders, as applicable,
reserves all of its or their respective rights, powers, and remedies under the
Existing Forbearance Agreement, as amended hereby and/or applicable law.  All of the provisions of the Existing
Forbearance Agreement, as amended hereby, are hereby reiterated, and if ever
waived, reinstated.


 


SECTION 8. 
Release. In consideration of the agreements of the Holders
set forth herein, each of the Issuer and each Guarantor hereby releases,
remises, acquits and forever discharges the Holders, and each of their
respective employees, agents, representatives, consultants, attorneys,
officers, directors, partners, fiduciaries, predecessors, successors and
assigns, subsidiary corporations, parent corporations and related corporate
divisions (collectively, the “Released Parties”), from any and all
actions, causes of action, judgments, executions, suits, debts, claims,
demands, liabilities, obligations, damages and expenses of any and every
character, known or unknown, direct or indirect, at law or in equity, of whatever
nature or kind, whether heretofore or hereafter arising, for or because of any
matter of things done, omitted or suffered to be done by any of the Released
Parties prior to and including the date of execution hereof, and in any way
directly or indirectly arising out of any or in any way connected to this
Agreement, the Indenture, the Note or the Security Documents (collectively, the
“Released Matters”). Each of the Issuer and each Guarantor hereby
acknowledges that the foregoing releases in this Agreement are intended to be
in full satisfaction of all or any alleged injuries or damages arising in
connection with the Released Matters. Each of the Issuer and each Guarantor
hereby represents and warrants to each Holder that it has not purported to
transfer, assign or otherwise convey any right, title or interest in any
Released Matter to any other Person and that the foregoing constitutes a full
and complete release of all Released Matters.


 


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EACH
OF THE ISSUER AND EACH GUARANTOR AGREES TO ASSUME THE RISK OF ANY AND ALL
UNKNOWN, UNANTICIPATED OR MISUNDERSTOOD DEFENSES, CLAIMS, CONTRACTS,
LIABILITIES, INDEBTEDNESS AND OBLIGATIONS WHICH ARE RELEASED, WAIVED AND
DISCHARGED BY THIS AGREEMENT. EACH OF ISSUER AND EACH GUARANTOR WAIVES AND
RELEASES ANY RIGHT OR DEFENSE WHICH IT MIGHT OTHERWISE HAVE UNDER ANY OTHER LAW
OR ANY APPLICABLE JURISDICTION WHICH MIGHT LIMIT OR RESTRICT THE EFFECTIVENESS
OR SCOPE OF ANY OF ITS WAIVERS OR RELEASES HEREUNDER.


 


SECTION 9.  Costs and
Expenses.  The Issuer
agrees to pay on demand all costs and expenses of the Holders in connection
with the preparation, execution and delivery of this Agreement, including the
reasonable fees, costs and expenses of counsel for the Holders with respect thereto.


 


SECTION 10. 
Execution in Counterparts.  This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.  Delivery of an executed signature page to
this Agreement by facsimile transmission or otherwise transmitted or
communicated by email shall be as effective as delivery of a manually executed
counterpart of this Agreement.


 


SECTION 11. 
Integration.  This Agreement
and any agreements referred to herein constitute the entire contract among the
parties hereto relating to the subject matter hereof and supersede any and all
previous agreements and understandings, oral or written, relating to the
subject matter hereof.  Upon the
effectiveness of this Agreement as set forth in Section 2 hereof, this
Agreement shall be binding upon and inure to the benefit of the parties to the
Indenture and, subject to and in accordance with Section 11.10 of the
Indenture, their respective successors and assigns.


 


SECTION 12. 
Severability.  Wherever
possible, each provision of this Agreement shall be interpreted in such a
manner as to be effective and valid under applicable law, but if any provision
of this Agreement shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this Agreement.


 


SECTION 13. Applicable Law.  This Agreement shall be governed by and be
construed and enforced in accordance with, the laws of the State of New York
(including without limitation Section 5-1401 of the New York General
Obligations Law).


 


SECTION 14. Headings.  Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purposes.


 


SECTION 15. 
Confidentiality.  Each
of the Issuer, each Guarantor and each Holder (and their respective successors
and assigns) shall not publicly disclose any information provided to them by
any Holder in connection with this Agreement, nor shall they publicly disclose
signature pages to this Agreement or any other provision of this Agreement
that discloses the Holders’ holdings (collectively, the “Holder Information”)
except: (1) in any legal proceeding relating to 


 


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this
Agreement, provided that the Issuer, the relevant Guarantor and/or Holder, as
applicable, shall use their reasonable best efforts to maintain the
confidentiality of Holder Information in the context of any such proceeding; (2) to
the extent required by law; and (3) in response to a subpoena, discovery
request, or a request from a government agency for information regarding Holder
Information or the information contained therein; provided that in the
case of clauses (2) and (3) above, the disclosing party provides
notice to the applicable Holder, promptly upon receipt of the subpoena or
request, unless such notice would be prohibited by law.  If the applicable Holder wishes to oppose the
production of such information, it may do so at its own expense.  Responding to any such subpoena or other
request, after providing notice as set forth herein, shall not be deemed to be
a breach of any provision of this Agreement. 
Notwithstanding anything to the contrary in this Section 15, the
Issuer may: (i) disclose the aggregate principal amount of Notes held by the
Holders executing this Agreement, taken as a whole and without reference to the
names of the Holders constituting such amount; and (ii) provide the
Trustee with the executed copy of this Agreement that includes the individual
signature pages of each of the Holders, but only in the event that the
Issuer first obtains the Trustee’s written consent not to publicly disclose any
information relating to the individual holdings of each Holder.


 


[SIGNATURE PAGES FOLLOW]


 


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IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed and delivered by their respective
officers thereunto duly authorized as of the date first written above.


 


	
   

  	
  VERTIS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ John V.
  Howard, Jr.

  
	
   

  	
   

  	
   Name:

  	
  John V. Howard, Jr.

  
	
   

  	
   

  	
   Title:

  	
  Secretary

  



 


	
   

  	
  ENTERON GROUP LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ John V.
  Howard, Jr.

  
	
   

  	
   

  	
   Name:

  	
  John V. Howard, Jr.

  
	
   

  	
   

  	
   Title:

  	
  Secretary

  



 


	
   

  	
  WEBCRAFT, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ John V.
  Howard, Jr.

  
	
   

  	
   

  	
   Name:

  	
  John V. Howard, Jr.

  
	
   

  	
   

  	
   Title:

  	
  Secretary

  



 


	
   

  	
  USA DIRECT, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ John V.
  Howard, Jr.

  
	
   

  	
   

  	
   Name:

  	
  John V. Howard, Jr.

  
	
   

  	
   

  	
   Title:

  	
  Secretary

  



 


	
   

  	
  VERTIS MAILING, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ John V.
  Howard, Jr.

  
	
   

  	
   

  	
   Name:

  	
  John V. Howard, Jr.

  
	
   

  	
   

  	
   Title:

  	
  Secretary

  



 


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  WEBCRAFT CHEMICALS, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ John V.
  Howard, Jr.

  
	
   

  	
   

  	
   Name:

  	
  John V. Howard, Jr.

  
	
   

  	
   

  	
   Title:

  	
  Secretary

  



 


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  [                                            ]

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  
	
   

  	
   

  	
   Name:

  	
   

  
	
   

  	
   

  	
   Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  $

  	
   

  
	
   

  	
  Aggregate principal amount
  of Notes 

  beneficially owned or managed on behalf 

  of accounts that hold or beneficially own 

  Notes

  
						



 


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