EXHIBIT 10.8B
December 10, 1991
Mr. Peter Brant
Mr. Joseph Allen
Brant-Allen Industries, Inc.
80 Field Point Road
Greenwich, Connecticut 06830
Dear Peter and Joe:
This letter is to set forth our understanding regarding several matters.
1. Dow Jones and The Washington Post agree to purchase from Bear Island
the equivalent of 6,000 metric tons of standard newsprint each. Payment will
be made on or before January 6, 1992. The purchase price is the equivalent of
$350 per metric ton of standard 48.8-gram newsprint, and $375 per metric ton
for 45-gram basis weight newsprint, f.o.b. the mill or the mill's warehouse.
Bear Island will arrange and pay for storage and rotation of this newsprint
for up to six months, if Dow Jones (or The Washington Post) so desires. This
tonnage is in addition to newsprint purchased pursuant to the contracts
("Newsprint Contracts") between the parties dated May 19, 1978, and amended on
April 1, 1987.
2. The price paid by Dow Jones and The Washington Post for newsprint
purchased in 1991 pursuant to the Newsprint Contracts will be calculated, on
a quarterly basis, (a) for the first three quarters by averaging prices for all
the tonnage sold by Bear Island to non-partners during each quarter; and
(b) for the fourth quarter by averaging equally Dow Jones's and The Post's
weighted average prices paid in the fourth quarter for all Eastern newsprint
from regular non-equity North American suppliers providing Dow Jones (or The
Post) 10,000 or more tons during 1991.
3. The pricing formula in the Newsprint Contracts will be amended, as set
forth in the accompanying Amendment, to be effective in 1992 and thereafter
unless the partners otherwise agree. In order to reflect the current industry
practice of premium discounts in prices of lighter basis weight newsprint,
during 1991 and 1992 the list price for 45-gram basis weight newsprint will be
converted into (or from) the list price for 48.8-gram basis weight newsprint
by dividing (or multiplying) the 45-gram list price by 1.0715.
Sincerely,
Dow Jones & Company, Inc.
By: /s/ James H. Ottaway, Jr.
-------------------------
James H. Ottaway, Jr.
Agreed to and accepted: The Washington Post
/s/ Peter M. Brant By: /s/ Martin Cohen
- ------------------ ----------------
Peter M. Brant Martin Cohen
Brant-Allen Industries, Inc.
General Partner
December 10, 1991
Bear Island Paper Company
Route 738
Ashland, Virginia 23005
Dear Sirs:
This Agreement will confirm that Section 3 of the newsprint
purchase contract between Bear Island and Dow Jones dated May 19,
1978, and amended on April 1, 1987, is further amended to read in
its entirety as follows:
Section 3. Price: As of January 1, 1992, the price to be
paid for newsprint purchased hereunder shall be calculated and
paid as follows:
(a) Within 20 days of the end of each quarter, The
Washington Post and Dow Jones will each advise Bear Island of its
respective Average Net Transaction Prices for newsprint (as
defined in the following sentence) purchased during the prior
quarter. The Average Net Transaction Price is the weighted
average price (on a freight pre-paid basis) of all Eastern
newsprint purchased by Dow Jones (or The Washington Post) from
regular North American non-equity/partner suppliers providing
10,000 or more tons to Dow Jones (or The Washington Post)
annually; prices will be adjusted for basis weight as set forth
in subsection (e) below.
During the last 10 days of each January, April, July and
October, Seller shall make a good faith estimate of what the
Partners' Price (as hereinafter defined) will equal during the
current quarter, and during such quarter Buyer will pay Seller
the estimated Partners' Price for newsprint.
In each January Bear Island will make a determination of the
actual Partners' Price for the immediately preceding calendar
year. If the actual Partners' Price exceeds the estimates
thereof paid by Dow Jones during such calendar year, Dow Jones'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, Dow Jones's account will be credited by
the amount of such excess.
(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) In each January Dow Jones's and The Washington Post's
independent public accountants shall certify the accuracy of
their respective Average Net Transaction Prices submitted to
Seller for the preceding year. In each January Seller's
independent public accountants shall certify Seller's calculation
of the actual Partner's Price for the immediately preceding year.
(d) "Partners' Price," means the average of the annual
Average Net Transaction Price of The Washington Post and Dow
Jones, weighted equally, such average not to be more than two
percent (2%) above nor less than two percent (2%) below Seller's
weighted average price for all tonnage sold to non-partners
during the calendar year. Prices will be adjusted for basis
weight as set forth in subsection (e) below.
(e) Unless the parties agree otherwise, prices for all
tonnage will be converted on a straight pro-rata basis into an
equivalent 48.8 gram basis weight price for making calculations.
(f) "Freight Allowance" for 1992 means an amount equal to
$23.54 per ton for customers receiving by rail, and $20.77 per
ton for customers receiving by truck. Commencing in January 1993
and in each January thereafter, the Freight Allowance for the
current calendar year shall be increased or decreased, as the
case may be, by the percentage by which Bear Island's average
annual transportation costs per ton for rail and truck increased
or decreased in the Eastern United States during the preceding
year over such costs during the prior year.
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/ James H. Ottaway Jr.
___________________________
Name: James H. Ottaway Jr.
Accepted and agreed upon: Accepted and agreed upon for
BEAR ISLAND PAPER COMPANY purposes of providing and
verifying past prices:
By: Brant-Allen Industries, Inc. THE WASHINGTON POST COMPANY
General Partner
By: /s/ Peter M. Brant By: /s/ Martin Cohen
____________________________ __________________________
Name: Peter M. Brant Martin Cohen