<PAGE>
EXHIBIT 10.8
[* SIGNIFIES THAT CONFIDENTIAL MATERIAL HAS
BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT.]
November 1, 2004
W.W. Norton & Company
500 Fifth Avenue
New York, NY 10110
This contract, when counter executed and
delivered to us, shall constitute an
agreement effective as of the above date
between W.W. NORTON & COMPANY, INC.
("Publisher") and THE PEOPLE'S PUBLISHING
GROUP INC. ("Distributor").
1)
APPOINTMENT.
a)
Publisher hereby appoints Distributor, and Distributor accepts
appointment to be, Publisher's sole and exclusive
distributor in the areas and markets set forth on Schedule 1
(the "Market") for the promotion, sale, and distribution of
the print materials set forth on Schedule 1. Schedule 1
shall be deemed amended from time to time to include all
Norton, Liveright and Countryman books in print and such
other distributees as the Publisher shall time-to-time
permit unless specific written notice of an exception is
provided to Distributor, which notice shall include a
statement of the reason for the exception. (All such
materials are referred to as "Works") Publisher will give
Distributor timely advance notice and information concerning
all new Works it plans to publish, including notice of any
sales restrictions, and one free copy of each new Work on
availability.
b) All
rights not specifically granted herein are retained by
Publisher.
c) This
agreement shall be effective on the above date and shall
continue until September 30, 2007 unless earlier terminated as
provided in section d)(i) and d)(ii). The Agreement shall
thereafter be automatically renewed from year to year unless
either party gives notice of termination on or before March
31st of any year commencing with 2008 to be effective the
immediately following September 30th. References in this
Agreement to "year" "fiscal year" or to "FY" shall mean the
twelve-month period ending on March 31st.
d) This
agreement may be terminated prior to September 30, 2007
in the event of any of the following occurrences:
i) If
Distributor fails to increase its purchases on a
year to year basis in order to sustain an average of
[*] over two fiscal years, then Publisher may
terminate this agreement on December 31st of the
fiscal year following that in which the shortfall
took place provided notification is given by June
15th. Purchases are defined as net purchases after
discount in the [*]
percent discount categories, (see
Section 2) (i) - (iii)) plus purchases by resellers
less commission, Section 2) (v), and claimed sales
less commission, Section 2) (vi).
<PAGE>
ii) If in the
period prior to September 30, 2007
Distributor undertakes to act in a like capacity for
a publisher other than Publisher, and Publisher
reasonably determines that such joint representation
is antithetical to Publisher's best commercial
interests, then Publisher may by written notice
terminate this
agreement effective the September 30th
that is at least 12 months from the date of notice.
Notwithstanding the foregoing, nothing in this
Agreement shall be deemed to limit any right, or
mandate any obligation on the part of Distributor to
sell to customers of its choosing.
2)
TERMS OF SALE.
(a)
Distributor may purchase Works from Publisher's available
inventory on the following terms, in each case payable in U.S.
dollars within [*] days of invoice:
COLLEGE TEXT PURCHASES
i) In
each period, Purchases by Distributor of Works for
sale directly to schools shall be at a discount of
[*]% from Publisher's net price.
ii) Purchases
by Distributor of Works for resale to
school
bookstores, and to enterprises that act as
resellers to secondary schools shall be at a discount
of [*]% from the Publisher's net price.
iii)
Purchases by Distributor of Works for Local Authority
Adoptions as defined in Schedule II shall be at a
discount of [*]% off Publisher's net price.
iv) Purchases
by Distributor of Works for State Adoptions
as defined in Schedule II shall be at the larger of a
discount of [*]% off Publisher's net price or [*]%
off Distributor's negotiated list price to the State
authority. Distributor will enter a State Adoption
only upon agreement with Publisher as outlined in
Schedule II.
v) In
each period, the Publisher will pay to the
Distributor a commission of [*]% of the net sales of
Works by resellers in the secondary school market who
buy direct from Publisher, as outlined in Schedule 1.
The commission will be paid only upon [*]. Publisher
will assist the Distributor in obtaining reseller
sales reports by school.
vi)
Distributor can claim [*]% commission on documented
orders to resellers in the Distributor's market as
defined in Schedule 1 provided that Distributor
actively sells to the school where the texts were
ultimately used. Publisher will calculate commission
on net sales after returns.
2
<PAGE>
TRADE TITLES
(a) Purchases
will be at the discounts and terms established, from
time to time, by Publisher for its trade wholesaler accounts.
Trade titles are not included in the definition of works in
Schedule 1. Publisher does not grant an exclusive to
Distributor on sales of Trade titles to the secondary market.
(b) Publisher
shall provide to Distributor each month an
electronic listing of all titles and their respective net
prices. It is
Distributor's responsibility to notify Publisher
of any such listings not received.
(c) Sales
shall be F.O.B. Publisher's bindery or warehouse, as
applicable. Publisher shall bill Distributor for the
discounted sales plus actual postage or other transportation
charges.
(d)
Distributor will use reasonable efforts to batch orders.
(e)
Distributor can qualify for the following incentive discounts.
"BASE SALES AMOUNT" is established as follows for each
12-month period ended March 31st, 2005 through March 31st,
2008.
The "Base Sales Amount" equals [*]% of the highest year's net
Purchases, from FY04 to FY08, by Distributor at the [*]%,
[*]%, and [*]% levels plus net sales less commission to
purchases of Works by resellers in the secondary school market
who buy direct from Publisher, as outlined in Schedule 1.
If the returns from Distributor to Publisher in the period
from which the Base Sales amount was calculated exceed [*]% of
gross purchases (net plus returns), then the Base Sales amount
will equal [*]% of the highest year's total as described
above.
Purchases by Distributor from Publisher after the Base Sales
amount is reached in a 12-month period ending March 31st, will
qualify for an extra discount of [*]% in each applicable
category -- [*]% will rise to [*], [*]% will rise to [*]%,
[*]% will rise to [*]%.
The extra discount earned after reaching the Base Sales amount
will not be calculated at purchase. The extra discount will be
paid after the end of the respective period ending March 31st.
3)
RETURNS.
For so long as Distributor is not in breach of this Agreement,
Distributor will have the right to return Works in saleable
condition,
for full credit against amounts due Publisher from Distributor or,
if
there are no such amounts due, for refund. Works received by
Distributor containing manufacturing defects may be returned
pursuant
to the applicable provisions of the Uniform Commercial Code.
3
<PAGE>
Returns of superceded editions will only be accepted for [*]
following
the publication of a new edition. Continuing purchases of
previous
edition texts made in order to fulfill contractual obligations may
be
returned up to [*] from date of purchase.
When Publisher determines that damaged returns are due to use of
the
text and not to defect, the Publisher may decline to accept the
return.
Publisher will not accept claims of damaged books after [*] months
from
date of the first use of the text. Distributor may buy
replacement
copies at the unit cost of the text.
Distributor will enact a returns policy for its customers with
respect
to Publisher's products that is substantially similar to the policy
in
effect at that time with respect to Publisher's sales to the
Market.
4)
RESPONSIBILITIES FOR PROMOTION.
(a)
Distributor will use reasonable efforts to promote Works in
the Market by means of telemarketing, catalogues and other
appropriate means. Distributor's
