AMENDMENT
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Amendment to a Sales Agreement dated as of June 19, 1996 (the "Sales Agreement")
by and between X. X. Xxxxxxxxx & Sons Company, a Delaware corporation
("Donnelley") and Metromail Corporation, a Delaware corporation ("Metromail").
WITNESSETH
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WHEREAS, in conjunction with its initial public offering of shares, Donnelley
and Metromail entered into the Sales Agreement pursuant to which Donnelley
agreed to sell certain Services on behalf of Metromail and Metromail agreed to
pay certain amounts to Donnelley in exchange therefore;
WHEREAS, as a condition to a tender offer for the shares of Metromail, Great
Universal Stores P.L.C. ("XXX") has required an extension of the term of the
Sales Agreement; and
WHEREAS, Donnelley is agreeable to extending the term of the Sales Agreement,
provided certain other amendments to the Sales Agreement are made;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:
Section 1. Definitions. All terms used herein shall have the meanings set forth
in the Sales Agreement.
Section 2. Effectiveness. This Amendment shall be effective upon the closing
by XXX of its offer to purchase the issued and outstanding shares
of Metromail (the "Amendment Effective Date"), but should such
closing not occur prior to May 31, 1998, this Amendment shall be
null and void and of no further force and effect.
Section 3. Charges. Upon the Amendment Effective Date, in lieu of the sales
commission described in Paragraphs 4(b) and (c) of the Sales
Agreement, the sales commission to be either withheld by Donnelley
(in the case of Paragraph 4(b)) or to be paid to Donnelley (in the
case of Paragraph 4(c)) shall be calculated on the same basis as set
forth on page 30 and according to the "Commissions" terms set forth
on page 45, both in a proposal from Metromail to Donnelley dated
February 5, 1998, except that the sales commission on sales of Mail
Production Services shall be calculated at a rate of 3%.
Furthermore, to the extent that the parties have entered into side
agreements prior to the Amendment Effective Date that alter the
terms of the Sales Agreement, then notwithstanding the provisions of
this Amendment, such side agreements shall continue to govern the
terms of the relationship to which they relate.
Section 4. Term. Upon the Amendment Effective Date, the provisions of Paragraph
7 of the Sales Agreement shall be deemed amended to change the
reference therein to "December 31, 1998" to "December 31, 2000."
Section 5. Additional Terms. Upon the Amendment Effective Date, the following
additional paragraphs shall be deemed added to the Sales Agreement:
10. In consideration of the mutual agreements contained
herein, MM agrees that during the term of this Agreement, it
shall not provide any of the Services to any of the
following entities, their subsidiaries or affiliates (each
being a "Restricted Entity"):
(a) Quad Graphics
(b) Quebecor
(c) World Color
(d) Xxxxx
(e) Big Flower;
provided that nothing herein shall prevent MM from providing
Services to the entities named above when such Services are
part of a contractual arrangement with RRD or a publisher.
MM further agrees that it shall not allow its affiliated
companies to either (i) enter into agreements to pay
commissions to any Restricted Entity for the sale of
Services; or (ii) allow any Restricted Entity to broker or
market the Services of such affiliated companies; but will
allow such affiliated companies to provide only spot or
overflow Services to any Restricted Entity as requested by
such Entity from time to time.
11. During the term of this Agreement, MM agrees to provide
support to RRD in its postal rate matters and other postal
affairs efforts at a level consistent with the support
provided in 1997.
12. MM currently has and supports DataLink connections at
two RRD facilities and absorbs tape and freight costs for
Services provided at other RRD facilities. MM agrees to
continue to support its DataLink connections as currently
installed at RRD facilities and to absorb tape and freight
costs for Services provided at other RRD facilities.
Further, MM agrees to determine the total tape and freight
costs for RRD facilities not utilizing a DataLink
connection, and to work with RRD to analyze opportunities to
improve service and costs through among other options,
DataLink installations at such facilities and the migration
of tape and freight costs to the ultimate customer.
13. MM and RRD agree to explore together opportunities to
create co-branded and/or proprietary product and service
offerings for mutual marketing efforts.
14. MM agrees to continue to provide up to 200 hours of
consulting and analytical services to RRD for RRD's internal
use during any calendar year beginning 1998 upon the request
of RRD.
15. The parties acknowledge that MM has products and
services beyond the Services described in this Agreement,
including database products. MM and RRD agree to work
together in good faith to establish a cost-plus arrangement
covering the sale of database products by RRD to its
targeted customer accounts, but the terms and conditions of
any such arrangement shall be contained in a further
amendment or addendum to this Agreement.
16. MM agrees to continue to support financially joint
marketing efforts by MM and RRD at not less than historical
levels (1997=$110,000). Further, MM agrees to increase such
historical levels at a rate of not less than 1% for each
dollar of gross sales other than sales of Mail Production
Services above $20.7 million provided by RRD to MM, and RRD
shall match any such expenditures by MM.
17. RRD agrees that should RRD contract in its own name
with its ultimate customer for the Services of MM, it shall
name MM as its subcontractor in its contract for such
Services.
18. RRD and MM agree to work together to determine the
level of support required by RRD sales personnel in order
for the sales commissions described in paragraph 4 to
continue to be payable thereunder when the ultimate customer
is no longer a customer of RRD, and the terms of this
Agreement shall be amended to reflect the agreement of the
parties.
Section 7. Execution in Counterparts. This Amendment may be executed in one
or more counterparts, each of which shall be considered an original instrument,
but all of which shall be considered one and the same amendment, and shall
become binding when one or more counterparts have been signed by each of the
parties hereto and delivered to each of Donnelley and Metromail.
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed
as of March 12, 1998.
X.X. XXXXXXXXX & SONS COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Executive Vice President and
Chief Financial Officer
METROMAIL CORPORATION
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
Chairman, President & Chief Executive
Officer
