EXHIBIT 10.31
BOLLORE TECHNOLOGIES S.A.
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North Atlantic Operating Company, Inc.
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October 22, 1997
Gentlemen,
Reference is made to the three Amended and Restated Distribution and
License Agreements (collectively, the "Distribution Agreements") each dated as
of November 30, 1992 between us relating to the distribution of Zig Zag
cigarette paper booklets in the United States (the "U.S. Agreement"), in Canada
(the "Canadian Agreement") and in Hong Kong and certain other territories (the
"Asian Agreement"), as amended by a Restated Amendment dated June 25, 1997 (the
"Restated Amendment"). This will confirm our agreement to amend the Distribution
Agreements as of January 1, 1998 as follows:
1. The paragraph beneath the caption "INITIAL PRICE FOR ALL PRODUCTS" set
forth on Schedule A to the U.S. Agreement and on Schedule A to the
Asian Agreement (as set forth in Section 10 of the Restated Amendment)
shall be deleted in its entirety and the following shall be inserted in
lieu thereof:
"[**] (subject to the [**] referred to in (ii) below); provided, that
for purposes of the foregoing calculations (and the [**] referred to in
(ii) below), if any booklets are shipped in one calendar year but are
paid for in the next subsequent calendar year, then such booklets shall
be deemed to have been both shipped and paid for in such subsequent
calendar year: provided, further, that for purposes of the foregoing
calculations (and the [**] referred to in (ii) below),
if any booklets are paid for in one calendar year but are shipped in
the next subsequent calendar year, then such booklets shall be deemed
to have been both shipped and paid for in such subsequent calendar
year. Notwithstanding the foregoing, (i) [**] and for each calendar
year thereafter, [**] of the total number of booklets shipped and paid
for in the immediately preceding calendar year and (b) the Base Amount.
For example, if during a calendar year, [**] the Distributor would be
entitled to receive the [**] for the next subsequent calendar year for
[**] shipped and paid for within such next subsequent calendar year in
excess of the Base Amount. This calculation is based on determining
[**]."
2. The paragraph beneath the caption "INITIAL PRICE FOR ALL PRODUCTS" set
forth on SCHEDULE A to the Canadian Agreement (as set forth in Section
11 of the Restated Amendment) shall be deleted in its entirety and the
following shall be inserted in lieu thereof:
"[**] (subject to the [**] referred to in (ii) below); provided, that
for purposes of the foregoing calculations (and the [**] referred to in
(ii) below), if any booklets are shipped in one calendar year but are
paid for in the next subsequent calendar year, then such booklets shall
be deemed to have been both shipped and paid for in one calendar year;
provided, further, that for purposes of the foregoing calculations (and
the [**] referred to in (ii) below), if any booklets are paid for in
one calendar year but are shipped in the next subsequent calendar year,
then such booklets shall be deemed to have been both shipped and paid
for in such subsequent calendar year. Notwithstanding the foregoing (i)
[**] and for each calendar year thereafter, [**] of the total number of
booklets shipped and paid for in the immediately preceding calendar
year and (b) the Base Amount. For example, if during a calendar year,
[**] the Distributor would be entitled to receive the [**] for the next
subsequent calendar year for [**] shipped and paid for within such next
subsequent calendar year in excess of the Base Amount. This calculation
is based on determining [**]."
3. Notwithstanding the above amendments, the parties acknowledge that the
price for all booklets shipped in 1997 (regardless of when paid) shall
be calculated
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based on the terms of the Distribution Agreements in
effect prior to this amendment.
4. Each of us represents and warrants to the other that this amendment has
been duly authorized by all necessary corporate action and that any
consents required by either party in connection with this amendment
have been obtained by such party.
5. Except as modified by this amendment, the terms and provisions of each
of the Distribution Agreements shall remain in full force and effect.
If the foregoing accurately reflects our understanding, please
countersign where indicated below.
Very truly yours,
BOLLORE TECHNOLOGIES S.A.
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President Directeur
General
Agreed:
NORTH ATLANTIC OPERATING COMPANY INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: President and Chief
Executive Officer
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