2 letters, 106 lines:
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Date: Wed, 17 Aug 1994 11:13:33 -0400
From: Michael Markwith <MARKWITH@FAXON.COM>
Subject: Letter
August 16, 1994
Nearly a year ago, FaxonUs management set a goal of restructuring the company
to ensure continued financial stability and clear focus for our organization.
I am pleased to announce that Faxon has met these goals through security
arrangements for 1995 subscription payments, the sale of certain assets, and
continued service improvements.
We are also pleased to announce that an agreement in principle with Elsevier
Science, our largest publisher, has been reached. Please see attached letter
for details.
The capital generated from these sales and the efficiencies of our continued
Service Improvement Program will allow Faxon to pay off all outstanding 1994
publisher debt and provide substantial working capital for the future.
1995 subscription orders
In terms of 1995 subscription orders, we are
segregating all 1995 client payments in a separate account to be used only to
pay 1995 orders. And, we will pay all 1995 subscription orders according to
standard industry practices.
Sale of assets
On August 4, we completed the sale of our European operations to
Swets & Zeitlinger B.V. of Lisse, The Netherlands. Included in this sale were
the offices of Faxon Europe in Amsterdam, Faxon U.K., Faxon France, Kunst und
Wissen, Wennergren-Williams, and Faxon International Moscow.
While we were unable to reach a final agreement with R. R. Donnelley and Sons,
we have entered into an agreement with EBSCO Industries for them to purchase
The Turner Subscription Agency and FaxonUs remaining non-U.S. operations. We
expect this sale to be concluded rapidly.
Service
These sales in no way affect FaxonUs ability to supply titles from
publishers anywhere in the world for our U.S. clients. We continue to handle
all titles for U.S. clients out of our Westwood headquarters, as always.
Internally, we continue to implement quality improvement programs to focus more
directly and efficiently on the delivery of our subscription services to our
U.S. clients.
With the accomplishment of these goals behind us, Faxon looks forward to
continuing our 113-year record of excellent service to clients and suppliers.
On behalf of everyone at Faxon, I thank you for your support through these
efforts.
Sincerely,
Judy Davis
President
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The following is reprinted from the _Newsletter on Serials Pricing
Issues_, no.119 (Aug. 15, 1994). --bml
119.4 AGREEMENT IN PRINCIPLE WITH FAXON
Letter from James Kels, Chairman, Elsevier Science.
Elsevier Science
655 Avenue of the Americas
New York NY 10010-5107
Amsterdam, 15 August 1994
Dear Librarian,
I am very pleased to announce that the Elsevier companies have reached an
agreement in principle with The Faxon Company which will enable Faxon to
resume normal trading with the Elsevier companies. The agreement is subject
to execution of final documentation.
The agreement in principle will establish a collateral account, held in
trust by the Bank of Boston, into which all 1995 subscription payments for
all publications handled by Faxon will be held until distributed to pub-
lishers; Faxon's existing debt to publishers will be retired; and new cred-
it for Faxon has been arranged. The arrangement is intended to encourage
publishers and clients to continue normal trading terms with Faxon.
Faxon has provided a unique service to the library commuity and to the
publishers for more than a century. Elsevier has been working with Faxon's
owners and management, and we are very pleased that we have found a way to
reinforce Faxon's financial stability and to encourage libraries and pub-
lishers to continue to enjoy Faxon's services.
Both Elsevier and Faxon are deeply appreciative of the patience and support
which the library community has shown in this difficult period. Now that
the process of resolution is in its last lap, we hope that this patience
and support will continue.
Yours sincerely,
James Kels
Chairman
