Document:

exv10w1

 

Exhibit 10.1

AMENDMENT NO. 1 AND WAIVER TO

CREDIT AGREEMENT

Dated as of February 13, 2006

          AMENDMENT NO. 1 AND WAIVER TO CREDIT AGREEMENT (this “Waiver”) among ACCO Brands
Corporation, a Delaware corporation (the
“Company”),
ACCO Nederland Holdings
B.V. (as successor to Furlon Holding B.V.), a private company with limited liability
(besloten vennootschap met beperkte aansprakelijkheid) organized under the laws of The Netherlands
(the “Dutch Borrower”), ACCO Brands Europe Ltd., a limited company organized
under the laws of England and Wales with registered number 5532999 (the “U.K. Borrower” and,
together with the Company and the Dutch Borrower, the “Borrowers”), the Lenders listed on the
signature pages hereto, Citicorp North America Inc., as administrative agent (the
“Administrative Agent”).

PRELIMINARY STATEMENTS

          (1) WHEREAS, the Borrowers are parties to a certain Credit Agreement, dated as of August 17,
2005 (as amended, amended and restated, supplemented or otherwise modified from time to time, the
“Credit Agreement” (terms used herein without definition in this Waiver have the meanings given
such terms by the Credit Agreement)), among the Borrowers, the Lenders, the Administrative Agent
and the other parties named therein;

          (2) WHEREAS, the Borrowers have requested that the Required Banks agree to amend and waive
certain provisions of the Credit Agreement;

          (3) WHEREAS, the Requisite Lenders have agreed, subject to the terms and conditions
hereinafter set forth, to amend and waive certain provisions of the Credit Agreement as set forth
below;

          NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the sufficiency and receipt of all of which is hereby acknowledged, the parties
hereto hereby agree as follows:

          SECTION 1. Waiver. As of the Effective Date (as defined in Section 3), the Requisite
Lenders hereby waive any Default or Event of Default (including as a result of any breach of any
representation or warranty in Section 4.4 of the Credit Agreement or a violation of the
requirements of Section 6.1 of the Credit Agreement) that may have resulted from understatements of
net deferred taxes payable of approximately $45 million and taxes currently payable of
approximately $6 million, and overstatement of equity of approximately $51 million (the “Disclosed
Financial Adjustments”) in the Company’s consolidated financial statements for the years ended
December 27, 2004, 2003 and 2002, for the three months ended March 25, 2005, for the six months
ended June 25, 2005 and for the nine months ended September 30, 2005 (the “Specified Financial
Statements”) resulting from:

 

 

     (i) the Company’s failure to properly record on the Company’s balance sheet deferred
income taxes related to intangible assets acquired before 1993 when it adopted SFAS 109; and

     (ii) the discovery of an error in the Company’s tax provision in 2002 of $2.7 million
which related to restructuring charges.

          SECTION 2. Amendment. No representation or warranty contained in Article IV of the
Credit Agreement shall be deemed to be incorrect as of the date of making such representation or
warranty following the Effective Date, solely as a result of the failure of the Specified Financial
Statements to reflect the Disclosed Financial Adjustments.

          SECTION 3. Conditions to Effectiveness. This Waiver shall become effective when, and
only when, and as of the date (the “Effective Date”) on which (a) the Administrative Agent shall
have received counterparts of this Waiver executed by the Borrowers and the Required Lenders, (b)
the Administrative Agent shall have received (for the pro rata accounts of each applicable
consenting Lender) a fee equal to 0.05% of the aggregate amount of Loans and Commitments held by
the Lenders that have consented to this Waiver on or prior to 5:00 p.m., New York City time, on
February 13, 2006, (c) the Administrative Agent shall have received a certificate signed by a duly
authorized officer of the Company dated the Effective Date, to the effect that, after giving effect
to this Waiver: (i) the representations and warranties contained in each of the Loan Documents are
true and correct in all material respects on and as of the Effective Date as though made on and as
of such date (unless stated to relate solely to an earlier date, in which case such representations
and warranties are true and correct in all material respects as of such earlier date); and (ii) no
Default has occurred and is continuing.

          SECTION 4. Representations and Warranties. The Borrowers represent and warrant as
follows:

          (a) The representations and warranties contained in each of the Loan Documents, after giving
effect to this Waiver, are true and correct in all material respects on and as of the date of this
Waiver, as though made on and as of such date (unless stated to relate solely to an earlier date,
in which case such representations and warranties are true and correct in all material respects as
of such earlier date).

          (b) After giving effect to this Waiver, no Default has occurred and is continuing on the date
hereof.

          SECTION 5. Reference to and Effect on the Loan Documents. (a) On and after the
Effective Date, each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”
or words of like import referring to the Credit Agreement, and each reference in the other Loan
Documents to “the Agreement”, “thereunder”, “thereof”, or words of like import referring to the
Credit Agreement shall mean and be a reference to the Credit Agreement, as modified hereby.

      
    (b) The Credit Agreement and each of the other Loan Documents, as specifically modified by
this Waiver, are and shall continue to be in full force and effect and are hereby in all respects
ratified and confirmed.

-2-

 

          (c) The execution, delivery and effectiveness of this Waiver shall not, except as expressly
provided herein, operate as a waiver of any right, power or remedy of the Credit Agreement or the
other Loan Documents, nor constitute a waiver of any provision of the Credit Agreement or the other
Loan Documents.

          SECTION 6. GOVERNING LAW. THIS WAIVER AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HERETO SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.

          SECTION 7. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ALL
RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT
OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS WAIVER OR THE ACTIONS OF THE COLLATERAL TRUSTEES
OR THE AGENT IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

          SECTION 8. Execution in Counterparts. This Waiver may be executed by one or more of
the parties to this Waiver on any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument.

          SECTION 9. Costs and Expenses. The Borrowers hereby agree to pay all reasonable costs
and expenses of the Administrative Agent associated with the preparation, execution, delivery,
administration, and enforcement of this Waiver, including, without limitation, the reasonable fees
and expenses of the Administrative Agent’s counsel and other out-of-pocket expenses related hereto.
Delivery of an executed counterpart of a signature page to this Waiver by telecopier shall be
effective as delivery of a manually executed counterpart of this Waiver.

-3-

 

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

	 	 	 	 	 
	 	ACCO Brands Corporation,

as U.S. Borrower

	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	ACCO Brands Europe Ltd.,

as U.K. Borrower

	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	ACCO Nederland Holdings B.V.,

as Dutch Borrower

	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

-4-

 

	 	 	 	 	 
	 	Citicorp North America, Inc.,

as Administrative Agent

	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

-5-

 

	 	 	 	 	 
	 	[Lender]

	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

-6-<PAGE>

    CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT
          HAVE BEEN REDACTED AND FILED SEPARATELY WITH THE COMMISSION.

                                                                 EXHIBIT 10.48.1

                               FIRST AMENDMENT TO
                        RETAIL MAGAZINE SUPPLY AGREEMENT

This FIRST AMENDMENT TO RETAIL MAGAZINE SUPPLY AGREEMENT BETWEEN BARNES & NOBLE,
INC. AND INTERNATIONAL PERIODICAL DISTRIBUTORS INC., dated August 6, 2004, as
revised, is made and entered into as of April 1, 2006 by and between Barnes &
Noble, Inc., 122 Fifth Avenue, New York, New York 10011 ("B&N") and
International Periodical Distributors, Inc., a wholly-owned subsidiary of Source
Interlink Companies, Inc., 27500 Riverview Center Blvd., Suite 400, Bonita
Springs, Florida 34134 ("IPD").

NOW THEREFORE, for good and valuable consideration the receipt and sufficiency
of which are hereby acknowledged, the parties hereby agree as follows:

1. REFERENCE TO AND EFFECT ON AGREEMENT. Subject to the terms hereof and except
as specifically modified hereby, the Retail Magazine Supply Agreement dated as
of August 6, 2004 between B&N and IPD (the "Agreement") shall remain in full
force and effect. The execution, delivery and effectiveness of this Amendment
shall not operate as a waiver of any right, power or remedy of either party
hereto, or constitute a waiver or amendment of any provision of the Agreement,
except as set forth herein. Solely with respect to the Imported Publications (as
defined herein), the Term of this Agreement shall be extended to March 31, 2010.
For all publications other than the Imported Publications, the Term of the
Agreement shall terminate or expire according to the terms of the Agreement as
set forth in Section 2 of the Agreement.

2. IMPORTED PUBLICATIONS. From and after April 1, 2006 and subject to the terms
and conditions of the Agreement (as herein amended), B&N agrees to purchase, and
IPD agrees to sell, during the four-year period ending March 31, 2010, each
Store's requirements for magazines published by any person or entity whose
primary place of business is located anywhere in the world other than the United
States of America (the "Imported Publications"). B&N hereby agrees to refrain
from purchasing Imported Publications, except from IPD under the terms and
conditions set forth in this Agreement and except as with respect to certain
publications mutually agreed from time to time by the parties hereto (to be
referred to by the parties as "Excluded Imported Publications"), such agreement
not to be unreasonably withheld. However, B&N may continue to purchase Imported
Publications from those companies that do not currently use IPD from B&N
magazine distributors other than IPD until July 1, 2006.

3. EXHIBIT A AMENDED. Exhibit A to the Agreement is hereby deleted in its
entirety and Exhibit A attached hereto substituted in lieu thereof.

4. ADDITIONAL REQUIREMENTS. In order to maintain its exclusive status with
respect to the distribution of Imported Publications to B&N, IPD must, (a) by
the end of the first year following the execution of this First Amendment,
achieve, and thereafter throughout the term of this First Amendment maintain, at
least 90% of the retail sales value of Imported Publications on an annualized
basis of what B&N currently achieves through its current non-IPD magazine
distributors, (b) maintain the ability, throughout the term of this First
Amendment, to supply substantially all Imported Publications supplied by IPD to
B&N as of April 1, 2006, in substantially the same quantities, and, (c) supply
all Imported Publications ranked within Barnes & Noble's top 1,000 best sellers
as of April 1, 2006, throughout the term of this First Amendment. Relating to
current non-IPD business, IPD may include in this calculation the sales of
Imported Publications within B&N that neither IPD nor any other B&N magazine
distributor currently provide to B&N.

5. ROLE OF SOURCE INTERLINK INTERNATIONAL (SII). Immediately following the
execution of this amendment IPD shall contract with its affiliate Source
Interlink International (SII) to provide display promotion marketing, product
procurement, and publisher support services on behalf of both B&N and IPD
towards the objective of furthering B&N's profile as a leading provider of
Imported Publications within the U.S. market.

<PAGE>

6. RETURNS PROCESSING. As part of this amendment IPD, through its Acme division,
agrees that during the Term it will pick up and process full copy returns of all
unsold magazines of all B&N magazine distributors, on a timetable to be mutually
agreed upon by IPD and B&N. IPD also agrees to pickup unsold paperback books
from B&N stores within its truck footprint. Until March 31, 2010, but only for
so long as B&N uses a returns processor other than it's magazine distributor,
Acme shall have the exclusive right to process magazine returns on behalf of all
B&N magazine distributors in accordance with the pricing schedule listed in
Exhibit C to this Amendment.

      IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed and delivered by their duly authorized representatives as of the day
and year first written above.

INTERNATIONAL PERIODICAL                     BARNES & NOBLE, INC.
DISTRIBUTORS, INC.

By: /s/ Jason S. Flegel                      By: /s/ Jaime Carey
    -----------------------                      -----------------------
Name: Jason S. Flegel                        Name: Jaime Carey
Title: Executive VP                          Title: VP Newsstand

<PAGE>

                                    EXHIBIT A
                          TERMS AND CONDITIONS OF SALE

A.    TITLE & OBLIGATION

      Upon receipt of the periodicals, B&N shall take title and be obligated to
pay in accordance with the terms below.

B.    PAYMENT TERMS

      All payments for Publications by B&N shall be made at the earlier of the
date of sale based on its scanned sales data or 120 days after receipt subject
to subsequent returns and shrink reconciliation. B&N shall cause its sales
systems to record the sale of the periodicals upon the product being scanned at
the point of sale. Sales information by store, day, unit, title and issue shall
be sent on a daily basis to IPD. IPD shall prepare remittance reports based on
the information pertaining to this scanned sales information. IPD will pay the
freight for shipments to B&N.

C.    PURCHASE PRICE

B&N shall pay a purchase price for Non-Imported Publications recorded as sold by
its Stores equal to (a) [***] off of the retail price printed on the cover of
each Publication or printed on a label affixed to such cover (the "Cover Price")
in the case of Publications other than weeklies and (b) [***] off of the Cover
Price for weekly Publications. B&N shall pay a purchase price for Imported
Publications recorded as sold by its Stores equal to the Total Applicable
Discount off the Cover Price, as so stated and set forth below:

NON-WEEKLY PUBLICATIONS

<TABLE>
<CAPTION>
                                         APPLICABLE DISCOUNT
     CALENDAR YEAR            ----------------------------------------------
------------------------                         APPLICABLE         TOTAL
BEGINNING        ENDING                          INCREMENTAL      APPLICABLE
 APRIL 1,      MARCH 31,      BASE DISCOUNT       DISCOUNT         DISCOUNT
---------      ---------      -------------      -----------      ----------
<S>            <C>            <C>                <C>              <C>
   2006          2007             [***]            [***]            [***]
   2007          2008             [***]            [***]            [***]
   2008          2009             [***]            [***]            [***]
   2009          2010             [***]            [***]            [***]
</TABLE>

WEEKLY PUBLICATIONS

<TABLE>
<CAPTION>
                                         APPLICABLE DISCOUNT
     CALENDAR YEAR            ----------------------------------------------
------------------------                         APPLICABLE         TOTAL
BEGINNING        ENDING                          INCREMENTAL      APPLICABLE
 APRIL 1,      MARCH 31,      BASE DISCOUNT       DISCOUNT         DISCOUNT
---------      ---------      -------------      -----------      ----------
<S>            <C>            <C>                <C>              <C>
   2006          2007             [***]            [***]            [***]
   2007          2008             [***]            [***]            [***]
   2008          2009             [***]            [***]            [***]
   2009          2010             [***]            [***]            [***]
</TABLE>

-------------
[***] indicates confidential material redacted and filed separately with the
      Commission

<PAGE>

All payments shall be made in accordance with the provisions of EXHIBIT B. In
addition to the Total Applicable Discount relating to both non-Imported
Publications and Imported Publications, B&N shall be entitled to take a payment
deduction, as a cash discount, equivalent to [***] of the calculated net
payment.

D.    RETURNS.

For a period of two years after the date of this Agreement, B&N shall cause the
front covers of such unsold copies to be torn from the Publication and delivered
to ACME Processing in accordance with current practices and rates, including
payment by B&N of the normal and customary expenses currently incurred with
respect to the shipment of the front covers to ACME Processing. B&N hereby
agrees to use its best efforts to cause all returned publications to be
destroyed or otherwise rendered unsaleable.

E.    DEFERRED RETURNS CREDITS.

In the case of non-weekly publications only: Effective with week 3 as displayed
on EXHIBIT B, B&N agrees to suspend all cash deductions resulting from returns
credited by IPD to B&N for product invoiced on a non-pay on scan basis prior to
the effective date of this agreement from the prior IPD account. The total
amount has been projected to be [***]. Effective with week 1, B&N shall deduct
[***] from each weekly payment, to be concluded in week 104. Further, effective
with week 27, B&N and IPD agree to take the difference between the projected
amount of suspended returns credits and the actual value of the returns credits,
and amortize this difference over weeks 27 through 104. Such amortized amounts
shall either supplement or subtract from the ongoing scheduled weekly deductions
of [***]

F.    TAX COLLECTION AND INDEMNITY

B&N shall collect and promptly pay to the appropriate taxing authorities all
sales, property or other taxes, assessments, or other public or private charges
levied against or payable with respect to the periodicals sold by IPD to B&N.
B&N hereby agrees to indemnify and hold IPD harmless from any and all claims,
demands, costs or liabilities (including reasonable attorney's fees) arising
from any taxes, assessments or charges related to the periodicals being sold to
B&N by IPD.

----------------
[***] indicates confidential material redacted and filed separately with the
      Commission

<PAGE>

                            EXHIBIT C FIRST AMENDMENT
                  ACME UNIT RETURNS PROCESSING PRICING SCHEDULE

<TABLE>
<CAPTION>
AMENDMENT                UNIT
  YEAR                   COST
---------               ------
<S>                     <C>
   1                    [***]
   2                    [***]
   3                    [***]
</TABLE>

---------------
[***] indicates confidential material redacted and filed separately with the
      Commission

<PAGE>

                            EXHIBIT D FIRST AMENDMENT
                         EXCLUDED IMPORTED PUBLICATIONS

                                      None.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00097-of-00352.parquet"}]]