EXHIBIT 10.8A
April 1, 1987
Bear Island Paper Company
Route 738
Ashland, Virginia 23005
Dear Sirs:
This will confirm that Sections 1, 2 and 3 of the
newsprint purchase contract between us dated May 19, 1978 are
hereby amended as follows:
Section 1 is hereby amended by adding the following
under the captions "Calendar Year" and "Tons of Newsprint":
Calendar Year Tons of Newsprint
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1988 and each 50,000
year thereafter
Sections 2 and 3 are hereby amended to read in their
entirety as follows:
Section 2. Term: This Agreement shall terminate on
December 31, 2000, except that it may be extended to December 31,
2004 provided that the parties agree upon new pricing provisions
for the period January 1, 2001 through December 31, 2004. This
Agreement will, however, extend automatically to December 31,
2004 if neither party requests renegotiation of price terms prior
to January 1, 2000.
Section 3. Price: The price to be paid for newsprint
purchased hereunder shall be calculated and paid as follows:
(a) Commencing as of the date hereof, and in each June
and December thereafter, Seller shall make a good faith
estimate of what the Partners' Price (as hereinafter
defined) will equal over the six months commencing January
1, 1987, and each succeeding six months commencing on each
July 1 and January 1 thereafter, and during such six months
Buyer will pay Seller the estimated Partners' Price for
newsprint purchased hereunder. The foregoing pricing
method will apply from January 1, 1987, and accordingly,
Seller shall immediately credit or debit Buyer's account by
the amount that the prices paid by Buyer for newsprint
purchased between January 1, 1987 and the date hereof were
more or less than the estimated Partners' Price set as of
the date hereof.
(b) Buyer may elect to purchase tonnage f.o.b. the
Mill, in which event Buyer will pay the estimated Partners'
Price less the Freight Allowance (as hereinafter defined).
(c) Commencing in January 1988, and in each January
thereafter,'Seller's independent public accountants shall
certify the actual Partners' Price for the immediately
preceding calendar year. If the actual Partners' Price
exceeds the estimates thereof paid by Buyer during such
calendar year, Buyer's account will be debited by the amount
of such excess; on the other hand, if such estimates of the
Partners' Price exceeded the actual Partners' Price, Buyer's
account will be credited by the amount of such excess.
(d) "Partners' Price" means the lesser of (i) Seller's
average publicly announced list price per ton for rolls in
carload or truckload lots, freight allowed or prepaid to
destinations within the continental United States east of
the Mississippi for the calendar year in question, (ii) the
average of the publisher prices publicly quoted from time to
time by Bowaters Southern Paper Corp., Boise Cascade
Corporation (DeRidder mill only), and Kimberly-Clark
Corporation, or their respective successors, (and after
giving effect to any publicly announced across-the-board
discounts), and (iii) the amount resulting from the
following formula:
A + B - C
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85,000
Where Accruals: The prices actually received by Seller for
the highest priced 85,000 tons sold by Seller during the calendar
year in question to customers other than Buyer, The Washington
Post Company, and their respective affiliates, provided that
(a) if Seller increases its publicly announced list
price one or more times during the calendar year in
question, said 85,000 tons will be drawn pro rata from the
tonnage sold before and after the price change in proportion
to the number of days in the year that each list price was
in effect (so that, for example, if Seller's list price were
to increase on July 1 of the year in question, 181/365ths
(i.e. 42,151) of the 85,000 "highest priced" tons would be
represented by the 42,151 highest priced tons sold between
January 1 and June 30 of that year; assuming no further
price increases in such year, the remaining 42,849 tons
would be represented by the 42,849 highest priced tons sold
after June 30 of that year); and
(b) if a customer whose purchases of newsprint during
the year in question were among the highest priced 85,000
tons (and thus included in "A") also purchased other
newsprint during such year from Seller at a lower price,
then the price actually received by Seller for such other
newsprint shall be added to "A" and the number of tons of
such other newsprint shall be added to the formula's
denominator; and
Where B equals: The lesser of (i) the Freight Allowance for
each ton of newsprint sold f.o.b. the Mill (the price for which
is included in "A"), and (ii) the difference between the price
for such ton and Seller's average publicly announced list price
per ton at the time such ton was sold; and
Where C equals: The amount by which any freight charges
included in "A" for shipments to destinations west of the
Mississippi or outside the continental United States exceed the
highest freight charges actually paid by Seller during such
calendar year for shipments within the continental United States
east of the Mississippi.
(e) Notwithstanding the foregoing provisions of
Section 3 (d) , if any sales are included in "A" to a
customer who also purchased newsprint during the calendar
year in question from any affiliate of Seller (including
without limitation F.F. Soucy, Inc., F.F. Soucy, Inc. &
Partners, or their respective affiliates) at a lower price
than was charged such customer by Seller, then for purposes
of calculating "A" for such calendar year, the price of the
newsprint sold to such customer by Seller shall not be
deemed to be the amount actually paid for such newsprint,
but shall be deemed to be the average price per ton paid by
such customer for all newsprint purchased during such
calendar year from Seller and Seller's affiliates.
(f) "Freight Allowance" means an amount equal to
$21.45 per ton for customers receiving by rail, and $19.50
per ton for customers receiving by truck, increased or
decreased, as the case may be, by the percentage by which
general transportation costs increase or decrease in the
Eastern United States between January 1, 1987 and the date
title passes to the Buyer or other customer in question. It
shall be Seller's responsibility to make reasonable
assessments annually of whether such general transportation
costs change sufficiently to justify an increase or decrease
pursuant to the foregoing sentence.
If the foregoing accurately reflects our agreement,
please execute this letter agreement in the space provided below.
Very truly yours,
DOW JONES & COMPANY, INC.
By: /s/ Peter S. Skinner
_______________________
Name: Peter S. Skinner
Accepted and agreed upon:
BEAR ISLAND PAPER COMPANY
By: Brant-Allen Industries, Inc.
General Partner
By: /s/ Peter M. Brant
____________________________
Name: Peter M. Brant