10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

þ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 25, 2005

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number 001-08454

ACCO Brands Corporation

(Exact Name of Registrant as Specified in Its Charter)

Delaware
(State or Other Jurisdiction of
Incorporation or Organization) 36-2704017
(I.R.S. Employer
Identification Number)

300 Tower Parkway
Lincolnshire, Illinois 60069
(Address of Registrant’s Principal Executive Office, Including Zip Code)
(847) 484-5050
(Registrant’s Telephone Number, Including Area Code)

N/A
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant was required to file such reports), and (2) has been subject to the filling requirements for at least the past 90 days.

Yes o No þ*

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

	Outstanding at
Class	July 31, 2005
Common Stock, $1.00 par value		53,476

* REGISTRANT’S REGISTRATION STATEMENT ON FORM S-4/A UNDER THE SECURITIES ACT OF 1933 WAS DECLARED EFFECTIVE ON JULY 15, 2005 AND REGISTRANT’S REGISTRATION STATEMENT ON FORM 8-A UNDER THE SECURITIES EXCHANGE ACT OF 1934 BECAME EFFECTIVE ON AUGUST 2, 2005. PRIOR THERETO, REGISTRANT’S BUSINESS WAS REPORTED AS A BUSINESS SEGMENT OF FORTUNE BRANDS, INC.

ACCO Brands Corporation and Subsidiaries

FORM 10-Q
For the Quarter Ended June 25, 2005
Table of Contents

		Page
PART I	Financial Information
Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets as of June 25, 2005 and December 27, 2004		2
	Condensed Consolidated Statements of Income for the three and six months ended June 25, 2005 and 2004		3
	Condensed Consolidated Statements of Cash Flows for the six months ended June 25, 2005 and 2004		4
	Notes to Condensed Consolidated Financial Statements		5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		24
Item 4.	Controls and Procedures		25
PART II	Other Information
Item 4.	Submission of Matters to a Vote of Security Holders		26
Item 6.	Exhibits		26
	Signatures		29
Copy of Resolutions of the Board of Directors
Form of Nonqualified Stock Option Award Notice
Forms of Nonqualified Stock Option Award Notices
Forms of Incentive Stock Option Award Notices
Form of Stock Option Agreement
Form of Stock Option Agreement
Forms of Stock Option Agreements
Form of 2004 Restricted Stock Unit Grant Notice
Letter Regarding Change in Accounting Principles
Certification of CEO Pursuant to Section 302
Certification of CFO Pursuant to Section 302
Certification of CEO Pursuant to Section 906
Certification of CFO Pursuant to Section 906

1

PART I. Financial Information

Item 1. Financial Statements

ACCO World Corporation and Subsidiaries
(Majority Owned Subsidiary of Fortune Brands, Inc.)

Condensed Consolidated Balance Sheets

	Pro forma
	June 25,
	2005			June 25,			December 27,
(in millions of dollars)	(Note 3)			2005			2004
	(Unaudited)			(Unaudited)
Assets
Current assets:
Cash and equivalents	$	18.2		$	18.2		$	79.8
Receivables, net		267.0			267.0			320.1
Inventories, net
Raw materials		23.7			23.7			24.7
Work in process		6.4			6.4			5.8
Finished products		157.7			157.7			142.0
		187.8			187.8			172.5
Deferred income taxes		7.6			7.6			4.2
Other current assets		24.1			24.1			19.9
Total current assets		504.7			504.7			596.5
Property, plant and equipment
Land and improvements		12.8			12.8			13.2
Buildings and improvements to leaseholds		116.7			116.7			117.8
Machinery and equipment		347.4			347.4			346.5
Construction in progress		9.8			9.8			15.0
		486.7			486.7			492.5
Less accumulated depreciation		(332.0	)		(332.0	)		(334.8	)
Property, plant and equipment, net		154.7			154.7			157.7
Deferred income taxes		12.2			12.2			21.7
Intangibles resulting from business acquisitions, net		115.9			115.9			117.6
Prepaid pension		84.9			84.9			87.1
Other assets		5.1			5.1			3.9
Total assets	$	877.5		$	877.5		$	984.5
Liabilities and stockholders’ equity
Current liabilities:
Notes payable to banks	$	0.9		$	0.9		$	0.1
Accounts payable		101.6			101.6			120.6
Accrued income taxes due to parent		3.6			3.6			14.3
Accrued customer programs		76.3			76.3			81.6
Accrued compensation, restructuring, and other liabilities		61.0			61.0			108.2
Dividend payable to shareholders		625.0			—			—
Total current liabilities		868.4			243.4			324.8
Postretirement and other liabilities		37.4			37.4			42.9
Total liabilities		905.8			280.8			367.7
Stockholders’ equity
Common stock, par value $1 per share, 53,476 shares authorized, issued and outstanding as at June 25, 2005 and December 27, 2004		0.1			0.1			0.1
Parent company investment		(309.3	)		(309.3	)		(269.5	)
Paid-in capital		1,213.0			1,838.0			1,835.1
Accumulated other comprehensive income		6.1			6.1			15.9
Accumulated deficit		(938.2	)		(938.2	)		(964.8	)
Total stockholders’ equity		(28.3	)		596.7			616.8
Total liabilities and stockholders’ equity	$	877.5		$	877.5		$	984.5

See notes to condensed consolidated financial statements.

2

ACCO World Corporation and Subsidiaries
(Majority Owned Subsidiary of Fortune Brands, Inc.)

Condensed Consolidated Statements of Income/(Loss)

	Three Months Ended					Six Months Ended
	June 25,					June 25,
	2005		2004			2005		2004
(in millions of dollars, except per share data)	(unaudited)		(unaudited)			(unaudited)		(unaudited)
Net sales	$	279.5	$	268.7		$	551.9	$	539.6
Cost of products sold		170.6		170.6			337.2		340.4
Advertising, selling, general and administrative expenses		84.0		85.8			166.0		170.4
Amortization of intangibles		0.4		0.3			1.0		0.6
Restructuring charges		—		16.8			—		19.4
Interest expense, including allocation from parent		2.0		1.7			4.1		3.9
Other expense (income), net		0.5		(3.8	)		1.6		(3.5	)
Income (loss) before income taxes		22.0		(2.7	)		42.0		8.4
Income taxes		7.3		3.8			17.0		6.3
Income (loss) before change in accounting principle		14.7		(6.5	)		25.0		2.1
Change in accounting principle		—		—			1.6		—
Net income (loss)	$	14.7	$	(6.5	)	$	26.6	$	2.1
Basic earnings (loss) per common share:
Income (loss) before change in accounting principle	$	0.42	$	(0.19	)	$	0.71	$	0.06
Change in accounting principle	$	—	$	—		$	0.05	$	—
Net income (loss)	$	0.42	$	(0.19	)	$	0.76	$	0.06
Unaudited pro-forma basic earnings per common share:
Income before change in accounting principle	$	0.26				$	0.39
Change in accounting principle	$	—				$	0.05
Net income	$	0.26				$	0.44
Unaudited pro-forma diluted earnings per common share:
Income before change in accounting principle	$	0.26				$	0.39
Change in accounting principle	$	—				$	0.05
Net income	$	0.26				$	0.44
Average number of common shares outstanding (in millions)
Basic		35.0		35.0			35.0		35.0
Average number of pro-forma common shares outstanding (in millions)
Basic		35.0					35.0
Diluted		35.4					35.4

Number of common shares outstanding are the ACCO Brands shares issued in conjunction with the spin-off from Fortune Brands completed on August 16, 2005 (see note 1).

See notes to condensed consolidated financial statements.

3

ACCO World Corporation and Subsidiaries
(Majority Owned Subsidiary of Fortune Brands, Inc.)

Condensed Consolidated Statement of Cash Flows

	Six months ended
	June 25,
	2005			2004
(in millions of dollars)	(Unaudited)			(Unaudited)
Net cash (used in) / provided by operating activities	$	(7.5	)	$	29.4
Investing activities
Additions to property, plant and equipment		(12.8	)		(11.7	)
Proceeds from the sale of property, plant and equipment		0.2			16.1
Other investing activities		(0.4	)		—
Net cash (used in) / provided by investing activities		(13.0	)		4.4
Financing activities
Decrease in parent company investment		(39.0	)		(17.9	)
Other financing activities		0.8			0.2
Net cash used by financing activities		(38.2	)		(17.7	)
Effect of foreign exchange rate changes on cash		(2.9	)		2.1
Net (decrease) / increase in cash and cash equivalents		(61.6	)		18.2
Cash and cash equivalents at the beginning of year		79.8			60.5
Cash and cash equivalents at the end of period	$	18.2		$	78.7

See notes to condensed consolidated financial statements.

4

ACCO World Corporation and Subsidiaries
(Majority Owned Subsidiary of Fortune Brands, Inc.)

Notes to Condensed Consolidated Financial Statements

1. Basis of Presentation

ACCO World Corporation (“ACCO World” or the “Company”), now doing business under the name ACCO Brands Corporation (“ACCO Brands”), supplies branded office products to the office products resale industry. On August 16, 2005, Fortune Brands, Inc. (“Fortune Brands” or the “Parent”), then the majority stockholder of ACCO World, completed its spin-off of the Company by means of the pro rata distribution (the “Distribution”) of all outstanding shares of ACCO Brands, which had been renamed from ACCO World, common stock held by Fortune Brands to its stockholders. In the Distribution, each Fortune Brands stockholders received one share of ACCO Brands common stock for every 4.255 shares of Fortune Brands common stock held of record as of the close of business on August 9, 2005. Following the Distribution, ACCO Brands became an independent, separately traded, publicly held company. On August 17, 2005, pursuant to an Agreement and Plan of Merger dated as of March 15, 2005, as amended as of August 4, 2005 (the “Merger Agreement”), by and among Fortune Brands, ACCO Brands, Gemini Acquisition Sub, Inc., a wholly-owned subsidiary of the Company (“Acquisition Sub”) and General Binding Corporation (“GBC”), Acquisition Sub merged with and into GBC (the “Merger”). Each outstanding share of GBC common stock and GBC Class B common stock was converted into the right to receive one share of ACCO Brands common stock and each outstanding share of Acquisition Sub common stock was converted into one share of GBC common stock. As a result of the Merger, the separate corporate existence of Acquisition Sub ceased and GBC continues as the surviving corporation and a wholly-owned subsidiary of ACCO Brands.

The condensed consolidated balance sheet as of June 25, 2005, the related condensed consolidated statements of income for the three months and six months ended June 25, 2005 and 2004, and the related condensed consolidated statements of cash flows for the six months ended June 25, 2005 and 2004 are unaudited. In the opinion of management, all adjustments consisting of only normal recurring adjustments necessary for a fair presentation of the financial statements have been included. Interim results may not be indicative of results for a full year.

The financial statements include the allocation of general and administrative expenses and interest expense from the Company’s parent, Fortune Brands, Inc. (as further described in note 4. “Parent Company Investment” to the financial statements contained herein). The financial statements are prepared on a basis consistent with that contained in ACCO World’s Registration Statement on Form S-4/A (Commission File # 333-124946), except that the financial statements for 2005 also include the cumulative effect of a change in accounting principle related to the elimination of a one month lag in reporting by two of the Company’s foreign subsidiaries to align their reporting period with the Company’s fiscal calendar.

The effect of this change is as follows:

	Three Months Ended March 25, 2005
						Restated for Effect of
			Effect of Change in			Change in
(in million of dollars)	As Reported		Accounting Principle			Accounting Principle
Net sales	$	275.2	$	(2.8	)	$	272.4
Cost of products sold		168.5		(1.9	)		166.6
Advertising, selling, general and administrative expenses		82.5		(0.5	)		82.0
Amortization of intangibles		0.6		—			0.6
Interest expense, including allocation from parent		2.1		—			2.1
Other expense (income), net		1.2		(0.1	)		1.1
Income (loss) before income taxes		20.3		(0.3	)		20.0
Income taxes		9.8		(0.1	)		9.7
Income (loss) before change in accounting principle		10.5		(0.2	)		10.3
Change in accounting principle		—		1.6			1.6
Net income	$	10.5	$	1.4		$	11.9

The condensed consolidated financial statements and notes do not contain certain information included in our annual consolidated financial statements and notes. The year-end condensed consolidated balance sheet was derived from the audited financial statements,

5

but does not include all disclosures required by generally accepted accounting principles. These interim statements should be read in conjunction with the consolidated financial statements and notes in the 2004 audited historical financial statements included in the Registration Statement on Form S-4/A.

The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions that affect the reported amounts of assets, liabilities, sales and expenses for the reporting periods. Actual results for future periods could differ from those estimates used by management.

2. Stock Based Compensation

As a subsidiary of Fortune Brands, Inc., the Company has no employee stock option plan; however, certain employees of the Company have been granted stock options and performance awards under the incentive plans of the Parent, including the 1999 and 2003 Long-Term Incentive Plans.

The Company applies APB Opinion No. 25, “Accounting for Stock Issued to Employees” and related interpretations in accounting for its stock plans as allowed under SFAS Statement No. 148. Had compensation cost for the fixed stock options granted during the three months and six months ended June 25, 2005 and 2004 been determined consistent with SFAS 148, pro-forma net income and earnings per common share of the Company would have been as follows:

	Three months
	ended
	June 25,
(in millions of dollars, except share data)	2005			2004
Net income (loss) — as reported	$	14.7		$	(6.5	)
Add: Stock based employee compensation (performance awards) included in reported net income, net of tax		0.1			0.1
Deduct: Total stock based employee compensation (stock options and performance awards) determined under the fair-value based method for all awards, net of tax		(1.1	)		(0.8	)
Pro-forma net income (loss)	$	13.7		$	(7.2	)
Pro-forma net earnings (loss) per common share	$	0.39		$	(0.21	)

	Six months
	ended
	June 25,
(in millions of dollars, except share data)	2005			2004
Net income — as reported	$	26.6		$	2.1
Add: Stock based employee compensation (performance awards) included in reported net income, net of tax		0.2			0.2
Deduct: Total stock based employee compensation (stock options and performance awards) determined under the fair-value based method for all awards, net of tax		(2.1	)		(1.7	)
Pro-forma net income	$	24.7		$	0.6
Pro-forma net earnings per common share	$	0.71		$	0.02

The Company’s Parent applies the “nominal vesting period approach” under APB 25, recognizing pro forma compensation cost over the three year vesting period, including for awards held by individuals who are eligible for retirement provisions under the applicable plan. Upon adoption of SFAS No. 123 “Share Based Payment”, expected at a future date, we will change the approach to recognize expense for retirement eligible employees over a period of less than one year.

3. Spin-off of the Company and Acquisition

The Distribution and the Merger were unanimously approved by the boards of directors of Fortune Brands, Inc. and GBC. The Merger was approved by GBC shareholders on August 15, 2005. The name of the new company formed is ACCO Brands Corporation, and the Company is listed on the New York Stock Exchange under the symbol ABD.

Prior to the Distribution, the Company declared a dividend of $625.0 million to its shareholders.

6

4. Parent Company Investment

Certain services were provided to the Company by the Parent. Executive compensation and consulting expenses which were paid by the Parent on behalf of the Company have been allocated based on actual direct costs incurred. Where specific identification of expenses was not practicable, the cost of such services was allocated based on the most relevant allocation method to the service provided. Costs for the most significant of these services, legal and internal audit, were allocated to the Company based on the relative percentage of net sales and total assets, respectively, of the Company to the Parent. The cost of all other services have been allocated to the Company based on the most relevant allocation method to the service provided, either net sales of the Company as a percentage of net sales of the Parent, total assets of the Company as a percentage total assets of the Parent, or headcount of the Company as a percentage of headcount of the Parent. Total expenses allocated to the Company were $0.7 million and $1.3 million for the three months ended June 25, 2005 and 2004, respectively, and $1.4 million and $2.3 million for the six months ended June 25, 2005 and 2004 respectively.

In addition, interest expenses associated with the Parent’s outstanding debt have been allocated to the Company based upon average net assets of the Company as a percentage of average net assets plus average consolidated debt not attributable to other operations of the Parent. The Company believes this method of allocating interest expense produces reasonable results because average net assets are a significant factor in determining the amount of parent company borrowings. No debt has been allocated by the Parent to the Company’s balance sheet. Total interest expense allocated to the Company was $2.5 million and $2.4 million for the three months ended June 25, 2005 and 2004, respectively and $5.2 million and $4.9 million for the six months ended June 25, 2005 and 2004 respectively.

5. Pension and Other Retiree Benefits

The components of net periodic benefit cost for pension and postretirement benefits for the three months ended June 25, 2005 and 2004 and six months ended June 25, 2005 and 2004 are as follows:

	Three months ended June 25,
	Pension						Postretirement
	Benefits						Benefits
(in millions of dollars)	2005			2004			2005			2004
Service cost	$	2.1		$	1.8		$	—		$	—
Interest cost		4.6			4.3			0.1			0.1
Deferred asset loss		—			0.1			—			—
Expected return on plan assets		(6.1	)		(5.7	)		—			—
Amortization of prior service cost		0.3			0.3			—			—
Amortization of net (gain)/loss		1.2			1.1			(0.3	)		(0.3	)
Curtailment (gain)/loss		—			0.1			—			(0.2	)
Net periodic benefit cost	$	2.1		$	2.0		$	(0.2	)	$	(0.4	)

	Six months ended June 25,
	Pension						Postretirement
	Benefits						Benefits
(in millions of dollars)	2005			2004			2005			2004
Service cost	$	4.1		$	3.6		$	0.1		$	0.1
Interest cost		9.2			8.7			0.3			0.3
Deferred asset loss		—			0.1			—			—
Expected return on plan assets		(12.2	)		(11.3	)		—			—
Amortization of prior service cost		0.6			0.5			—			—
Amortization of net (gain)/loss		2.4			2.2			(0.5	)		(0.5	)
Curtailment (gain)/loss		—			0.2			—			(0.3	)
Net periodic benefit cost	$	4.1		$	4.0		$	(0.1	)	$	(0.4	)

The Company expects to contribute $5.0 million to its pension plans in 2005.

7

6. Product Warranties

The Company offers its customers various warranty terms based on the type of product that is sold. Warranty expense is generally recorded at the time of sale. The following table summarizes activity related to our product warranty liability during the three and six month periods ended June 25, 2005 and 2004:

	Three months ended
	June 25,
(in millions of dollars)	2005			2004
Reserve balance as of March	$	(2.7	)	$	(1.2	)
Provision for warranties issued		(0.2	)		(0.2	)
Settlements made (in cash or kind)		0.5			0.2
Reserve balance as of June	$	(2.4	)	$	(1.2	)

	Six months ended
	June 25,
(in millions of dollars)	2005			2004
Reserve balance as of year end	$	(2.7	)	$	(1.2	)
Provision for warranties issued		(1.1	)		(0.6	)
Settlements made (in cash or kind)		1.4			0.6
Reserve balance as of June	$	(2.4	)	$	(1.2	)

7. Income Taxes

     During the first half of 2005, the Company recorded income tax expense of $2.6 million related to foreign earnings no longer considered permanently reinvested. Of this charge, $1.2 million is associated with foreign earnings repatriation under the provisions of the American Jobs Creation Act of 2004. As a result, the Company reported a 40% effective tax rate as of June 25, 2005. For the six month period ended June 25, 2004, the effective tax rate was 74.0% and was negatively impacted by the establishment of valuation allowances relating to deferred tax assets primarily stemming from certain foreign net operating losses.

8. Restructuring Charges

On April 19, 2001, the Company announced that as a result of its evaluation of strategic options, it would immediately begin implementing a plan designed to improve both financial results and the long-term value of the business. As part of this restructuring program, the Company recorded $19.4 million of pre-tax restructuring charges for the six month period ended June 25, 2004. This amount included a release of $1.6 million of excess amounts established in a prior year. The charges related to employee termination costs (approximately 283 positions) and to asset write-offs, and were primarily related to the consolidation or closure of manufacturing facilities in the United States, the United Kingdom and mainland Europe. There were no restructuring charges recorded for the six month period ended June 25, 2005.

Reconciliation of the restructuring liability as of June 25, 2005 is as follows:

	Balance at										Balance at
	December 27,		2005		Cash			Non-Cash			June 25,
(in millions of dollars)	2004		Provision		Expenditures			Write-Offs			2005
Employee termination costs	$	0.2	$	—	$	(0.1	)	$	—		$	0.1
International distribution and lease agreements		2.7		—		(0.3	)		(0.1	)		2.3
	$	2.9	$	—	$	(0.4	)	$	(0.1	)	$	2.4

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9. Information on Business Segments

The Company is organized into business segments based on the products and markets served. The Company’s business segments are described below:

ACCO U.S. — ACCO U.S. sells to U.S. customers and serves as one of two primary product ‘hubs’ for the business, driving much of the new product development and innovation opportunities for the North American region. The two ‘hubs’ coordinate product development activities to avoid duplication of effort while maintaining both global and local consumer focus.

ACCO Europe — In Europe, ACCO U.K. sells to customers in the United Kingdom, and serves as the primary product ‘hub’ for the European offerings. ACCO Europe businesses in France, Germany, Italy, Holland, Ireland, Spain, Poland, the Czech Republic, Sweden, Belgium, Austria, Switzerland and Hungary are principally engaged in selling products that are global or products that have been localized for their geographic market. These products are sourced from ACCO World’s U.K. product ‘hub’ (manufactured product), supplied by third party vendors, or manufactured regionally.

Trading companies — The Company’s businesses in Australia, New Zealand, Canada, Mexico, and Chile, referred to as our “Trading Companies”, are principally engaged in selling product which is either global or products that have been localized for their geographic market. These products are sourced from ACCO World’s business ‘hubs’ (manufactured product) in the U.S. and Europe, supplied by third party vendors, or manufactured locally.

Day-Timers — The Company’s Day-Timers business is based in the U.S. and includes subsidiaries in Australia, New Zealand and the United Kingdom. They manufacture a significant amount of their paper-based product in the United States, and source the remaining materials and finished goods from third parties.

Net sales for the three and six month periods ended June 25 by segment are as follows:

	Three months ended June 25,				Six months ended June 25,
(in millions of dollars)	2005		2004		2005		2004
ACCO U.S.	$	129.7	$	126.1	$	253.2	$	246.1
ACCO Europe		93.2		86.9		186.0		179.8
Trading Companies		45.0		42.4		86.9		86.3
Day-Timers		11.6		13.3		25.8		27.4
Total	$	279.5	$	268.7	$	551.9	$	539.6

Operating income for the three and six month periods ended June 25 by segment is as follows:

	Three months ended June 25,						Six months ended June 25,
(in millions of dollars)	2005			2004			2005			2004
ACCO U.S.	$	6.6		$	5.7		$	15.4		$	7.1
ACCO Europe		12.1			(12.1	)		22.6			(2.9	)
Trading Companies		9.0			6.6			15.2			13.1
Day-Timers		(0.3	)		(0.4	)		—			(0.5	)
Corporate expenses		(2.9	)		(4.6	)		(5.5	)		(8.0	)
	$	24.5		$	(4.8	)	$	47.7		$	8.8
Interest expense		2.0			1.7			4.1			3.9
Other expense (income)		0.5			(3.8	)		1.6			(3.5	)
Income (loss) before taxes		22.0			(2.7	)		42.0			8.4
Income taxes		7.3			3.8			17.0			6.3
Net income before change in accounting principle	$	14.7		$	(6.5	)	$	25.0		$	2.1

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Operating income as presented in the segment table above is defined as i) net sales, ii) less cost of products sold, iii) less advertising, selling, general and administrative expenses, iv) less amortization of intangibles, and v) less restructuring charges.

10. Earnings per Share

Following the Distribution of shares, the Company’s total shares outstanding increased significantly to 35.0 million from 53,476. The number of shares outstanding after the Distribution have been used in the earnings (loss) per common share calculation below. Basic earnings (loss) per common share are calculated by dividing net income (loss) by the weighted average number of common shares outstanding in the period. A dual presentation of basic and diluted earnings per share is not required due to the lack of potentially dilutive securities under the Company’s simple capital structure.

The computation of basic earnings per common share for “Net income (loss)” is as follows:

	Three months ended June 25,					Six months ended June 25,
(in millions, except per share amounts)	2005		2004			2005		2004
Net income (loss)	$	14.7	($	6.5	)	$	26.6	$	2.1
Weighted average number of common shares outstanding		35.0		35.0			35.0		35.0
Basic earnings (loss) per common share	$	0.42	($	0.19	)	$	0.76	$	0.06

11. Unaudited Pro-forma Earnings per Share

The transaction discussed in Note 3 significantly impacted the capital structure of the Company. Immediately prior to the spin-off from Fortune Brands, Inc., the Company paid a dividend of $625.0 million to its shareholders. Upon the spin-off, the total shares outstanding of the Company increased significantly — for every 4.255 shares outstanding of Fortune Brands, Inc. stock, 1 share of ACCO Brands, the post-spin company, was issued to shareholders of the Parent. In addition, outstanding unvested stock options held by employees of the Company were converted from Fortune Brands, Inc. stock options to ACCO Brands stock options.

Pro-forma earnings per share as of June 25, 2005 for ACCO Brands are as follows:

	Three months ended			Six months ended
(in millions, except per share amounts)	June 25, 2005			June 25, 2005
Net income before change in accounting principle	$	14.7		$	25.0
Less: Pro-forma interest expense (1)		(5.6	)		(11.3	)
Pro-forma net income before change in accounting principle		9.1			13.7
Change in accounting principle		—			1.6
Pro-forma net income	$	9.1		$	15.3
Common shares outstanding — basic (2)		35.0			35.0
Exercise of stock options (3)		0.4			0.4
Pro-forma common shares outstanding — diluted		35.4			35.4
Basic pro-forma earnings per common share before change in accounting principle	$	0.26		$	0.39
Change in accounting principle	$	—		$	0.05
Basic pro-forma earnings per common share	$	0.26		$	0.44
Diluted pro-forma earnings per common share before change in accounting principle	$	0.26		$	0.39
Change in accounting principle	$	—		$	0.05
Diluted pro-forma earnings per common share	$	0.26		$	0.44

(1)	Pro-forma interest expense for the six months ended June 25, 2005 ($17.4 million) is calculated based upon assumed financing of the Company of $625.0 million to fund the dividend payable to the shareholders at an interest rate of 5.56%, net of tax of $6.1 million. Pro-forma interest expense for the three months ended June 25, 2005 was ($8.7 million), net of tax of $3.1 million.
(2)	Shares of stock outstanding are the number of ACCO Brands shares issued in conjunction with the spin-off from Fortune Brands completed on August 16, 2005.

10

(3) Assumes that pro-forma outstanding common shares were increased by shares of those unvested stock options in the Parent company stock, for which the market price of the Parent company stock exceeds the exercise price of the option, less shares which could have been purchased by the Company with related proceeds. The total number of options exchanged as a result of the spin-off from Fortune Brands were 0.7 million, with an exercise price range of $5.35 to $19.18 per share.

12. Comprehensive Income (Loss)

Comprehensive income is defined as net income (loss) and other changes in stockholders’ equity from transactions and other events from sources other than stockholders, including currency translation gains and losses. Total comprehensive income (loss) recognized during the three months ended June 25, 2005 and 2004 was $3.5 million and ($11.3 million), respectively and during the six months ended June 25, 2005 and 2004 was $16.8 million and $6.1 million respectively.

13. Subsequent Event

     In conjunction with the spin-off of ACCO World Corporation to the shareholders of Fortune Brands, Inc., and the Merger with General Binding Corporation (GBC), ACCO Brands Corporation issued $350 million in senior subordinated notes with a fixed interest rate of 7.625% due 2015 (the “Notes”). Additionally, ACCO Brands and a subsidiary of ACCO Brands located in the United Kingdom and a subsidiary of ACCO Brands located in the Netherlands have entered into the following new senior secured credit facilities with Citicorp North America, Inc., ABN AMRO Bank, N.V. and a syndicate of other lenders.

     The senior secured credit facilities provide for the following facilities:

• a $400.0 million U.S. term loan facility, with quarterly amortization, maturing on August 17, 2012, with interest based on either LIBOR or a base rate;

• a $130.0 million dollar revolving credit facility (including a $40.0 million letter of credit sublimit) maturing on August 17, 2010, with interest based on either LIBOR or a base rate;

• a £63.6 million sterling term loan facility, with quarterly amortization, maturing on August 17, 2010, with interest based on LIBOR;

• a €68.2 million euro term loan facility, with quarterly amortization, maturing on August 17, 2010, with interest based on EURIBOR; and

• a $20.0 million dollar equivalent euro revolving credit facility maturing on August 17, 2010 with interest based on EURIBOR.

     ACCO Brands is the borrower under the U.S. term loan facility and the dollar revolving credit facility, the United Kingdom subsidiary is the borrower under the sterling term loan facility and the dollar equivalent euro revolving credit facility and the Netherlands subsidiary is the borrower under the euro term loan facility. Borrowings under the facilities are subject to a “pricing grid” which provides for lower interest rates in the event that certain financial ratios improve in future periods.

     The net proceeds of the senior subordinate bond issue, together with borrowings under the new senior secured credit facilities and cash on hand were used to finance the repayment of special dividend notes issued by ACCO World to its stockholders, repay existing indebtedness of GBC and ACCO World and fund fees and expenses related to the note offering.

     The senior secured credit facilities are guaranteed by substantially all of the domestic subsidiaries of ACCO Brands (the “U.S. guarantors”) and secured by substantially all of the assets of the borrowers and each U.S. guarantor.

     The Company must meet certain restrictive financial covenants as defined under the senior secured credit facilities. The covenants become more restrictive over time and require the Company to maintain certain ratios related to total leverage and interest coverage. There are also other restrictive covenants, including restrictions on dividend payments, acquisitions, additional indebtedness, and capital expenditures.

     The senior secured credit facilities contain customary events of default, including payment defaults, breach of representations and warranties, covenant defaults, cross-defaults and cross-accelerations, certain bankruptcy or insolvency events, judgment defaults, certain ERISA-related events, changes in control or ownership, and invalidity of any collateral or guarantee or other document.

     Each of ACCO Brands’ domestic subsidiaries that guarantees obligations under the senior secured credit facilities, also unconditionally guarantees the Notes on an unsecured senior subordinated basis.

     The indenture governing the Notes contains covenants limiting, among other things, ACCO Brands’ ability, and the ability of the ACCO Brands’ restricted subsidiaries to, incur additional debt, pay dividends on capital stock or repurchase capital stock, make certain investments, enter into certain types of transactions with affiliates, limit dividends or other payments by our restricted

11

subsidiaries to ACCO Brands, use assets as security in other transactions and sell certain assets or merge with or into other companies.

     As of the closing date, the amount available for borrowings under the Revolving Credit Facility was $145.1 million (allowing for $4.9 million of letters of credit outstanding as of the closing date).

14. Condensed Consolidated Financial Information

Following the Distribution and Merger the Company’s domestic subsidiaries were required to jointly and severally, fully and unconditionally guarantee the Notes. (see Note 13). Rather than filing separate financial statements for each guarantor subsidiary with the Securities and Exchange Commission, the Company has elected to present the following consolidating financial statements which detail the results of operations, for the three months and six months ended June 25, 2005 and June 25, 2004, cashflows for the six months ended June 25, 2005 and June 25, 2004 and financial position as of June 25, 2005 and December 27, 2004, of the Company and its guarantor, and non-guarantor subsidiaries (in each case carrying investments under the equity method), and the eliminations necessary to arrive at the reported consolidated financial statements of the Company.

12

Consolidating Balance Sheets

	June 25, 2005 (unaudited)
	ACCO Brands
(in millions of dollars)	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Assets
Current assets
Cash and cash equivalents	$	1.0		$	(6.7	)	$	23.9		$	—		$	18.2
Accounts receivable, net		—			136.3			130.7			—			267.0
Inventory, net		—			105.0			82.8			—			187.8
Receivables from affiliates		13.5			15.3			(5.6	)		(23.2	)		—
Deferred taxes		(1.7	)		6.7			2.6			—			7.6
Income taxes receivable		0.1			1.0			(1.1	)		—			—
Other current assets		0.2			11.4			12.5			—			24.1
Total current assets		13.1			269.0			245.8			(23.2	)		504.7
Property, plant and equipment, net		0.1			53.0			101.6			—			154.7
Deferred income taxes		2.7			19.7			(10.2	)		—			12.2
Intangibles, net of accumulated amortization		70.3			30.3			15.3			—			115.9
Prepaid pension expense		—			29.3			55.6			—			84.9
Other assets		2.0			3.1			—			—			5.1
Investment in /long term receivable from affiliates		519.6			25.7			—			(545.3	)		—
Total assets	$	607.8		$	430.1		$	408.1		$	(568.5	)	$	877.5
Liabilities and Stockholders’ Equity
Current liabilities
Notes payable to banks	$	—		$	—		$	0.9		$	—		$	0.9
Accounts payable		—			50.8			50.8			—			101.6
Accrued current income taxes		2.2			(3.1	)		4.5			—			3.6
Accrued customer programs		—			39.3			37.0			—			76.3
Accrued compensation, restructuring and other liabilities		2.2			27.2			31.6			—			61.0
Payables to affiliates		1.3			11.2			7.9			(20.4	)		—
Total current liabilities		5.7			125.4			132.7			(20.4	)		243.4
Long-term notes payable to affiliates		—			348.0			6.5			(354.5	)		—
Postretirement and other liabilities		5.4			8.8			23.2			—			37.4
Total liabilities		11.1			482.2			162.4			(374.9	)		280.8
Stockholder’s equity
Common stock		0.1			0.9			9.6			(10.5	)		0.1
Parent company investment		(309.3	)		(21.3	)		25.3			(4.0	)		(309.3	)
Paid-in capital		1,838.0			620.2			101.4			(721.6	)		1,838.0
Accumulated other comprehensive income (loss)		6.1			(1.2	)		9.3			(8.1	)		6.1
Accumulated deficit		(938.2	)		(650.8	)		100.1			550.7			(938.2	)
Total stockholders’ equity		596.7			(52.2	)		245.7			(193.5	)		596.7
Total liabilities and stockholders’ equity	$	607.8		$	430.1		$	408.1		$	(568.5	)	$	877.5

13

	December 27, 2004
	ACCO Brands
(in millions of dollars)	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Assets
Current assets
Cash and cash equivalents	$	—		$	(13.4	)	$	93.2		$	—		$	79.8
Accounts receivable, net		—			175.6			144.5			—			320.1
Inventory, net		—			88.4			84.1			—			172.5
Receivables from affiliates		8.6			25.5			22.2			(56.3	)		—
Deferred taxes receivable		0.2			5.6			(1.6	)		—			4.2
Other current assets		0.1			5.8			14.0			—			19.9
Total current assets		8.9			287.5			356.4			(56.3	)		596.5
Property, plant and equipment, net		0.1			53.2			104.4			—			157.7
Deferred income taxes		5.2			23.9			(7.4	)		—			21.7
Intangibles, net of accumulated amortization		70.4			30.3			16.9			—			117.6
Prepaid pension expense		—			30.0			57.1			—			87.1
Other assets		1.9			2.0			—			—			3.9
Investment in /long term receivable from affiliates		617.6			43.1			—			(660.7	)		—
Total assets	$	704.1		$	470.0		$	527.4		$	(717.0	)	$	984.5
Liabilities and Stockholders’ Equity
Current liabilities
Notes payable to banks	$	—		$	—		$	0.1		$	—		$	0.1
Accounts payable		—			60.1			60.5			—			120.6
Accrued current income taxes		4.9			4.8			4.6			—			14.3
Accrued customer programs		—			47.5			34.1			—			81.6
Accrued compensation, restructuring and other liabilities		9.0			52.1			47.1			—			108.2
Payables to affiliates		67.2			34.0			14.4			(115.6	)		—
Total current liabilities		81.1			198.5			160.8			(115.6	)		324.8
Long-term notes payable to affiliates		—			348.0			3.4			(351.4	)		—
Postretirement and other liabilities		6.2			10.9			25.8			—			42.9
Total liabilities		87.3			557.4			190.0			(467.0	)		367.7
Stockholder’s equity
Common stock		0.1			0.9			9.6			(10.5	)		0.1
Parent company investment		(269.5	)		(53.4	)		(13.8	)		67.2			(269.5	)
Paid-in capital		1,835.1			619.3			114.9			(734.2	)		1,835.1
Accumulated other comprehensive income (loss)		15.9			(1.3	)		19.4			(18.1	)		15.9
Accumulated deficit		(964.8	)		(652.9	)		207.3			445.6			(964.8	)
Total stockholders’ equity		616.8			(87.4	)		337.4			(250.0	)		616.8
Total liabilities and stockholders’ equity	$	704.1		$	470.0		$	527.4		$	(717.0	)	$	984.5

14

Consolidating Income Statements

	Three months ended June 25, 2005 (unaudited)
	ACCO Brands
(in millions of dollars)	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Unaffiliated sales	$	—		$	140.6		$	138.9		$	—		$	279.5
Affiliated sales		—			4.7			4.4			(9.1	)		—
Net sales		—			145.3			143.3			(9.1	)		279.5
Cost of products sold		—			96.0			83.7			(9.1	)		170.6
Advertising, selling, general and administrative expenses		3.0			43.1			37.9			—			84.0
Amortization of intangibles		0.1			—			0.3			—			0.4
Interest (income)/expense from affiliates		(5.4	)		5.4			—			—			—
Interest (income)/expense, including allocation from Parent		2.7			(0.3	)		(0.4	)		—			2.0
Other (income)/expense, net		(1.0	)		0.7			0.8			—			0.5
Income before taxes and earnings of wholly owned subsidiaries		0.6			0.4			21.0			—			22.0
Income taxes		0.4			0.7			6.2			—			7.3
Income (loss) before earnings/(losses) of wholly owned subsidiaries		0.2			(0.3	)		14.8			—			14.7
Earnings/(losses) of wholly owned subsidiaries		16.2			0.6			—			(16.8	)		—
Net income (loss)	$	16.4		$	0.3		$	14.8		$	(16.8	)	$	14.7

	Three months ended June 25, 2004 (unaudited)
	ACCO Brands
(in millions of dollars)	Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Unaffiliated sales	$	—		$	138.6		$	130.1		$	—		$	268.7
Affiliated sales		—			(5.4	)		7.9			(2.5	)		—
Net sales		—			133.2			138.0			(2.5	)		268.7
Cost of products sold		—			83.7			89.4			(2.5	)		170.6
Advertising, selling, general and administrative expenses		4.1			45.6			36.1			—			85.8
Amortization of intangibles		—			—			0.3			—			0.3
Restructuring charges		—			1.6			15.2			—			16.8
Interest (income)/expense from affiliates		(4.2	)		4.2			—			—			—
Interest (income)/expense, including allocation from Parent		2.6			(0.1	)		(0.8	)		—			1.7
Other (income)/expense, net		—			(4.0	)		0.2			—			(3.8	)
Income (loss) before taxes and earnings/(losses) of wholly owned subsidiaries		(2.5	)		2.2			(2.4	)		—			(2.7	)
Income taxes		(0.9	)		1.9			2.8			—			3.8
Income (loss) before earnings/(losses) of wholly owned subsidiaries		(1.6	)		0.3			(5.2	)		—			(6.5	)
Earnings/(losses) of wholly owned subsidiaries		(2.6	)		2.2			—			0.4			—
Net income (loss)	$	(4.2	)	$	2.5		$	(5.2	)	$	0.4		$	(6.5	)

15

	Six months ended June 25, 2005 (unaudited)
	ACCO
(in millions of dollars)	Brands Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Unaffiliated sales	$	—		$	277.4		$	274.5		$	—		$	551.9
Affiliated sales		—			7.8			11.1			(18.9	)		—
Net sales		—			285.2			285.6			(18.9	)		551.9
Cost of products sold		—			186.0			170.1			(18.9	)		337.2
Advertising, selling, general and administrative expenses		5.1			85.4			75.5			—			166.0
Amortization of intangibles		0.1			—			0.9			—			1.0
Interest (income)/expense from affiliates		(10.4	)		10.4			—			—			—
Interest (income)/expense, including allocation from Parent		5.6			(0.4	)		(1.1	)		—			4.1
Other (income)/expense, net		(5.9	)		0.6			6.9			—			1.6
Income before taxes and earnings of wholly owned subsidiaries		5.5			3.2			33.3			—			42.0
Income taxes		2.3			2.1			12.6			—			17.0
Net income before change in accounting principle		3.2			1.1			20.7			—			25.0
Change in accounting principle		—			—			1.6						1.6
Income (loss) before earnings/(losses) of wholly owned subsidiaries		3.2			1.1			22.3			—			26.6
Earnings/(losses) of wholly owned subsidiaries		25.1			1.7			—			(26.8	)		—
Net income (loss)	$	28.3		$	2.8		$	22.3		$	(26.8	)	$	26.6

	Six months ended June 25, 2004 (unaudited)
	ACCO
(in millions of dollars)	Brands Parent			Guarantors			Non-Guarantors			Eliminations			Consolidated
Unaffiliated sales	$	—		$	271.8		$	267.8		$	—		$	539.6
Affiliated sales		—			(0.9	)		12.2			(11.3	)		—
Net sales		—			270.9			280.0			(11.3	)		539.6
Cost of products sold		—			173.7			178.0			(11.3	)		340.4
Advertising, selling, general and administrative expenses		6.9			91.0			72.5			—			170.4
Amortization of intangibles		—			—			0.6			—			0.6
Restructuring charges		—			2.9			16.5			—			19.4
Interest (income)/expense from affiliates		(8.4	)		8.4			—			—			—
Interest (income)/expense, including allocation from Parent		5.3			(0.1	)		(1.3	)		—			3.9
Other (income)/expense, net		—			(4.0	)		0.5			—			(3.5	)
Income (loss) before taxes and earnings/(losses) of wholly owned subsidiaries		(3.8	)		(1.0	)		13.2			—			8.4
Income taxes		(1.3	)		0.8			6.8			—			6.3
Income (loss) before earnings/(losses) of wholly owned subsidiaries		(2.5	)		(1.8	)		6.4			—			2.1
Earnings/(losses) of wholly owned subsidiaries		6.9			2.3			—			(9.2	)		—
Net income (loss)	$	4.4		$	0.5		$	6.4		$	(9.2	)	$	2.1

16

Consolidating Statement of Cash Flows

	Six months ended June 25, 2005 (unaudited)
	ACCO Brands
(in millions of dollars)	Parent			Guarantors			Non-Guarantors			Eliminations		Consolidated
Net cash (used in)/provided by operating activities:	$	(2.7	)	$	(26.9	)	$	22.1		$	—	$	(7.5	)
Investing activities:
Additions to property, plant and equipment		—			(5.2	)		(7.6	)		—		(12.8	)
Proceeds from the sale of property, plant and equipment		—			—			0.2			—		0.2
Other investing activities		(0.4	)		—			—			—		(0.4	)
Net cash (used)/provided by investing activities		(0.4	)		(5.2	)		(7.4	)		—		(13.0	)
Financing activities:
Decrease in parent company investment		(39.0	)		—			—			—		(39.0	)
Intercompany financing		(74.7	)		38.3			36.4			—		—
Intercompany dividends		117.8			0.5			(118.3	)		—		—
Repayments on short-term debt		—						0.8					0.8
Net cash (used)/provided by financing activities		4.1			38.8			(81.1	)		—		(38.2	)
Effect of foreign exchange rate changes on cash		—			—			(2.9	)		—		(2.9	)
Net increase/(decrease) in cash and cash equivalents		1.0			6.7			(69.3	)		—		(61.6	)
Cash and cash equivalents at the beginning of the year		—			(13.4	)		93.2			—		79.8
Cash and cash equivalents at the end of the period	$	1.0		$	(6.7	)	$	23.9		$	—	$	18.2

	Six months ended June 25, 2004 (unaudited)
	ACCO Brands
(in millions of dollars)	Parent			Guarantors			Non-Guarantors			Eliminations		Consolidated
Net cash (used in)/provided by operating activities:	$	(6.2	)	$	7.3		$	28.3		$	—	$	29.4
Investing activities:
Additions to property, plant and equipment		—			(7.9	)		(3.8	)		—		(11.7	)
Proceeds from the sale of property, plant and equipment		—			13.8			2.3			—		16.1
Net cash (used)/provided by investing activities		—			5.9			(1.5	)		—		4.4
Financing activities:
Decrease in parent company investment		(17.9	)		—						—		(17.9	)
Intercompany financing		5.1			(19.0	)		13.9			—		—
Intercompany dividends		19.0			6.8			(25.8	)		—		—
Repayments on short-term debt		—			—			0.2			—		0.2
Net cash (used)/provided by financing activities		6.2			(12.2	)		(11.7	)		—		(17.7	)
Effect of foreign exchange rate changes on cash		—			—			2.1			—		2.1
Net increase in cash and cash equivalents		—			1.0			17.2			—		18.2
Cash and cash equivalents at the beginning of the year		—			(6.9	)		67.4			—		60.5
Cash and cash equivalents at the end of the period	$	—		$	(5.9	)	$	84.6		$	—	$	78.7

17

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     On August 16, 2005, ACCO World Corporation was spun-off from Fortune Brands, Inc. and immediately thereafter a wholly owned subsidiary of the Company merged with General Binding Corporation. The name of ACCO World Corporation was changed to ACCO Brands Corporation. Prior to completion of the transaction, the Company filed a Form 8-K in regards to its results for the second quarter of 2005. Results for the Office segment of Fortune Brands, Inc. were included in the previously filed Fortune Brands, Inc. Form 10-Q dated August 9, 2005.

     The financial statements include the allocation of certain SG&A expenses and interest expense from the Company’s parent, Fortune Brands, Inc. The financial statements are prepared on a basis consistent with that contained in ACCO World’s Registration Statement on Form S-4/A, except that the financial statements for 2005 also include the cumulative effect of a change in accounting related to the elimination of a one month lag in reporting by two of ACCO World’s foreign subsidiaries. The net impact of this change in accounting was to decrease previously reported first quarter net sales by $2.8 million and decrease previously reported first quarter operating income by $0.4 million. The net impact of the accelerated reporting has been reflected as a cumulative effect of change in accounting principle of $1.6 million and is excluded from the net sales and operating income discussed below.

     Management’s discussion and analysis of financial condition and results of operations should be read in conjunction with the respective financial statements of ACCO World Corporation and the accompanying notes contained therein.

Three Months Ended June 25, 2005 Versus Three Months Ended June 25, 2004

 Net Sales

     Sales for the three month period ended June 25, 2005 increased $10.8 million, or 4%, to $279.5 million. The increase was principally related to favorable foreign currency translation ($8.5 million) and volume growth in Kensington computer accessories, including new products, in both the U.S. and continental Europe. The increase was partly offset by lower sales in the U.S and Canada due to a shift in back-to-school shipments from the second quarter to the third quarter, and the negative impact of increased sales deductions/customer programs related to competitive pricing pressures.

 Restructuring

     There were $2.9 million in restructuring-related charges for the three month period ended June 25, 2005. The charges related to business repositioning costs in advance of the spin-off of $2.0 million and charges related directly to the spin-off from Fortune Brands, Inc. of $0.9 million. The prior year three month period ended June 25, 2004 included restructuring charges of $16.8 million and restructuring-related charges of $12.8 million.

     During the three months ended June 25, 2004 the restructuring and associated restructuring-related costs were primarily related to the closure of manufacturing operations at ACCO World’s Val Reas, France and Turin, Italy facilities and transferring the majority of the production to our Tabor, Czech Republic facility; SG&A cost reduction programs and asset impairment charges in the U.S..

     Management believes that a comparative review of operating income before restructuring and restructuring-related charges allows for a better understanding of the underlying business’ performance from year to year. The following table provides ACCO World’s reported results and the amounts of restructuring and restructuring-related charges for the three month periods ended June 25, 2005 and June 25, 2004.

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	Three Months Ended June 25, 2005
			Gross				Operating
	Net Sales		Profit		SG&A		Income
	(in millions of dollars)
Reported results	$	279.5	$	108.9	$	84.0	$	24.5
Restructuring and restructuring-related charges included in the above numbers
Restructuring-related costs		—		—	$	2.9	$	2.9

	Three Months Ended June 25, 2004
			Gross				Operating
	Net Sales		Profit		SG&A		Income
	(in millions of dollars)
Reported results	$	268.7	$	98.1	$	85.8	$	(4.8)
Restructuring and restructuring-related charges included in the above numbers
Restructuring costs		—		—		—	$	16.8
Restructuring-related costs		—	$	7.0	$	5.8	$	12.8

  Gross Profit

     Gross profit for the three month period ended June 25, 2005 increased $10.8 million, or 11%, to $108.9 million and the gross profit margin increased to 39.0% from 36.5%. Excluding the restructuring-related costs identified above the gross profit margin in 2004 would have been 39.1%. The decrease in margin for 2005 is attributable to an unfavorable sales mix to lower margin private label products in the U.S., offset by the favorable impact of foreign exchange on inventory purchase transactions of outsourced products at the Company’s foreign operations and sales growth in higher relative margin product categories such as Kensington computer accessories.

  SG&A (Advertising, selling, general and administrative expenses)

     SG&A decreased $1.8 million, or 2%, to $84.0 million for the three month period ended June 25, 2005 and decreased as a percentage of net sales to 30.1% from 31.9%. Excluding the restructuring-related costs SG&A as a percentage of net sales would have been 29.0% and 29.8%, respectively. The reduction for 2005 is attributable to lower administrative expenses, partially offset by increased distribution and freight expenses..

  Operating Income

     Operating income increased $29.3 million to $24.5 million for the three month period ended June 25, 2005 from a loss of $4.8 million for the three month period ended June 25, 2004 and increased as a percentage of sales to 8.8% from (1.8)%. The increase was driven by reduced restructuring and restructuring-related charges, higher net sales and reduced spending.

  Interest, Other Expense/(Income) and Income Taxes

     Interest expense increased $0.3 million to $2.0 million for the three month period ended June 25, 2005. Other expense (income) increased $4.3 million to $0.5 million for the three month period ended June 25, 2005, primarily due to the gains recorded on the sales of closed facilities in the prior year and higher foreign exchange losses in the current year. Income tax expense for the three month period ended June 25, 2005 increased $3.5 million. The effective tax rate for the period ended June 25, 2005 was 33.2% compared to 141% for the three month period ended June 25, 2004. The three month period ended June 25, 2004 effective tax rate was negatively impacted by the establishment of valuation allowances relating to deferred tax assets primarily stemming from certain foreign net operating losses.

  Net Income

     Net income increased $21.2 million to $14.7 million for the three month period ended June 25, 2005 due primarily to the reduction of restructuring and related charges in comparison to the three month period ended June 25, 2004.

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Segment Discussion

  ACCO U.S.

     Sales for the three month period ended June 25, 2005 increased $3.6 million, or 3%, to $129.7 million. The increase was driven by volume growth in Kensington computer accessories, including new products, partly offset by lower sales to retailers due to a shift in back-to-school shipments from the second quarter to the third quarter and increased sales deductions/customer programs related to competitive pricing pressure, the incremental impact of customer consolidations and the resolution of customer billing delays.

     Gross profit decreased $2.6 million, or 6%, to $42.5 million for the three month period ended June 25, 2005 primarily due to the increase in sales deductions noted above, an unfavorable sales mix to lower margin private label products and unfavorable manufacturing variances due to timing of production; partly offset by increased sales of higher relative margin computer accessories. Operating income increased $0.9 million, or 16.0%, to $6.6 million for the three month period ended June 25, 2005 primarily due to the absence of restructuring-related charges in the current year, partly offset by decreased gross profit and higher distribution and freight expenses.

  ACCO Europe

     Sales for the three month period ended June 25, 2005 increased $6.3 million, or 7%, to $93.2 million. The increase was related to favorable currency translation ($5.2 million) and volume growth in Kensington computer accessories and Rexel binding and laminating machines.

     Gross profit increased $11.6 million, or 42%, to $39.4 million for the three month period ended June 25, 2005 due to the absence of restructuring-related charges in comparison to the three month period ended June 25, 2004, the incremental benefit of facility closures and supply chain realignment completed in 2004 and increased sales. Operating income increased $24.2 million, to $12.1 million for the three month period ended June 25, 2005.

  Trading Companies

     Sales for the three month period ended June 25, 2005 increased $2.6 million, or 6%, to $45.0 million. The increase was the result of favorable currency translation ($3.2 million) and was partly offset by lower sales in Canada due to a shift in back-to-school shipments from the second quarter to the third quarter.

     Gross profit increased $2.3 million, or 13%, to $19.6 million for the three month period ended June 25, 2005 due to higher sales and the favorable impact of foreign exchange on inventory purchase transactions of outsourced products. Operating income increased $2.4 million, or 36%, to $9.0 million for the three month period ended June 25, 2005 due to increased gross profit.

  Day-Timers

     Sales for the three month period ended June 25, 2005 decreased $1.7 million, or 13%, to $11.6 million. The decrease was driven by a shift in sales from the second quarter to the third quarter, as Day-Timers began sales on a consignment basis to a major retail customer during the third quarter of 2004 (which impacted the timing of sales recognition related to the seasonally strong back-to-school season).

     Gross profit decreased $0.4 million, or 5%, to $7.7 million for the three month period ended June 25, 2005 primarily due to reduced sales, partly offset by higher gross margins due to favorable sales mix to the higher margin direct channel. Operating loss decreased $0.1 million to $0.3 million for the three month period ended June 25, 2005, primarily due to higher gross margins.

Six Months Ended June 25, 2005 Versus Six Months Ended June 25, 2004

  Net Sales

     Sales for the six month period ended June 25, 2005 increased $12.3 million, or 2%, to $551.9 million. Results benefited from favorable currency translation ($14.6 million) and volume growth in Kensington computer accessories, including new products, in both the U.S. and continental Europe. The increase was partly offset by lower sales in the U.S. and Canada due to a shift in back-to-school shipments from the second quarter to the third quarter, increased sales deductions/customer programs related to competitive pricing pressures and the incremental impact of customer consolidations and by weak economic conditions in the U.K. which primarily affected the first quarter.

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  Restructuring

     There were $2.9 million in restructuring-related charges for the six month period ended June 25, 2005. The charges related to spin repositioning costs in advance of the spin-off of $2.0 million and charges related directly to the spin-off from Fortune Brands, Inc. business of $0.9 million. The prior year six month period ended June 25, 2004 included restructuring charges of $19.4 million and restructuring-related charges of $17.4 million.

     During the six months ended June 25, 2004 the restructuring and associated restructuring-related costs were primarily related to the closure of manufacturing operations at the Company’s Val Reas, France and Turin, Italy facilities and transferring the majority of the production to our Tabor, Czech Republic facility; SG&A cost reduction programs and asset impairment charges in the U.S.

     Management believes that a comparative review of operating income before restructuring and restructuring-related charges allows for a better understanding of the underlying business’ performance from year to year. The following table provides ACCO World’s reported results and the amounts of restructuring and restructuring-related charges for the six month periods ended June 25, 2005 and June 25, 2004.

	Six Months Ended June 25, 2005
			Gross				Operating
	Net Sales		Profit		SG&A		Income
	(in millions of dollars)
Reported results	$	551.9	$	214.7	$	166.0	$	47.7
Restructuring and restructuring-related charges included in the above numbers
Restructuring-related costs		—		—	$	2.9	$	2.9

	Six Months Ended June 25, 2004
			Gross				Operating
	Net Sales		Profit		SG&A		Income
	(in millions of dollars)
Reported results	$	539.6	$	199.2	$	170.4	$	8.8
Restructuring and restructuring-related charges included in the above numbers
Restructuring costs		—		—		—	$	19.4
Restructuring-related costs		—	$	8.8	$	8.6	$	17.4

  Gross Profit

     Gross profit for the six month period ended June 25, 2005 increased $15.5 million, or 8%, to $214.7 million and the gross profit margin increased to 38.9% from 36.9%. Excluding the restructuring-related costs described above, the gross profit margin in 2004 would have been 38.5%. The improvement in margin for 2005 is attributable to the favorable impact of foreign exchange on inventory purchase transactions of outsourced products at the Company’s foreign operations and sales growth in higher relative margin product categories, such as Kensington computer accessories, partly offset by increased sales deductions,and an unfavorable sales mix to lower margin private label products in the U.S.

  SG&A (Advertising, selling, general and administrative expenses)

     SG&A for the six month period ended June 25, 2005 decreased $4.4 million, or 3%, to $166.0 million and decreased as a percentage of sales to 30.1% from 31.6%. Excluding the restructuring-related costs, SG&A as a percentage of net sales would have been 29.6% and 30.0% for 2005 and 2004, respectively. The net improvement is attributable to lower administrative expenses, partially offset by increased distribution and freight expenses.

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  Operating Income

     Operating income increased $38.9 million, or 442%, to $47.7 million for the six month period ended June 25, 2005 and increased as a percentage of sales to 8.6% from 1.6%. The increase was driven by reduced restructuring and restructuring-related costs, reduced manufacturing labor cost and higher sales.

  Interest, Other Expense/(Income) and Income Taxes

     Interest expense increased $0.2 million to $4.1 million for the six month period ended June 25, 2005. Other expense (income) increased $5.1 million to $1.6 million for the six month period ended June 25, 2005, primarily due to the gains recorded on the sales of closed facilities in the prior year and higher foreign exchange losses in the current year. Income tax expense for the six month period ended June 25, 2005 increased $10.7 million. The effective tax rate for the six month period ended June 25, 2005 was 40.3% compared to 74.0% for the six month period ended June 25, 2004. The six month period ended June 25, 2005 effective tax rate was increased due to recognition of income taxes on foreign dividends repatriated to the U.S. in 2005. The six month period ended June 25, 2004 effective tax rate was negatively impacted by the establishment of valuation allowances relating to deferred tax assets primarily stemming from certain foreign net operating losses.

  Net Income

     Net income increased $24.5 million to $26.6 million for the six month period ended June 25, 2005 as a result of increased operating income described above, partly offset by increased income tax expense.

Segment Discussion

  ACCO U.S.

     Sales for the six month period ended June 25, 2005 increased $7.1 million, or 3%, to $253.2 million. The increase was driven by new products and volume growth in Kensington computer accessories, partly offset by increased sales deductions/customer programs related to competitive pricing pressure, the incremental impact of customer consolidations and the resolution of customer billing delays (following the Company’s prior year new system implementation).

     Gross profit increased by only $0.5 million, or 1%, to $85.8 million for the six month period ended June 25, 2005 primarily due to increased sales deductions noted above and unfavorable sales mix to lower margin private label products, partly offset by sales growth in higher relative margin computer accessory products. Operating income increased $8.3 million, or 117%, to $15.4 million for the six month period ended June 25, 2005, due to the absence of restructuring and restructuring-related charges and reduced administrative costs; partly offset by increased distribution and freight expenses.

  ACCO Europe

     Sales for the six month period ended June 25, 2005 increased $6.2 million, or 3%, to $186.0 million. Favorable foreign exchange ($9.9 million) and volume growth in continental Europe from gains in Kensington computer accessories and Rexel binding and laminating machines, were partly offset by a decline in the U.K. due to weak economic conditions, primarily in the first quarter.

     Gross profit increased $13.4 million, or 21%, to $76.5 million for the six month period ended June 25, 2005 primarily due to a lack of restructuring-related charges in comparison to the six month period ended June 25, 2004, the incremental benefit of facility closures and supply chain realignment completed in 2004 and increased net sales. Operating income increased $25.5 million to $22.6 million for the six month period ended June 25, 2005 due to reduced restructuring and restructuring-related charges compared to the prior year and higher sales.

  Trading Companies

     Sales for the six month period ended June 25, 2005 increased $0.6 million, or 1%, to $86.9 million due to favorable currency translation ($4.4 million) offset by a volume decline in Canada related primarily to a shift in back-to-school shipments from the second quarter to the third quarter.

     Gross profit increased $2.0 million, or 6%, to $36.8 million for the six month period ended June 25, 2005 principally due to the favorable impact of foreign exchange on inventory purchases of outsourced products. Operating income increased $2.1 million, or 16%, to $15.2 million for the six month period ended June 25, 2005 due to the increase in gross profit.

  Day-Timers

     Sales for the six month period ended June 25, 2005 decreased $1.6 million, or 6%, to $25.8 million. The decrease was driven by a shift in sales from the second quarter to the third quarter, as Day-Timers began sales on a consignment basis to a major retail customer

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during the third quarter of 2004 (which impacted the timing of sales recognition related to the seasonally strong back-to-school season).

     Gross profit decreased $0.2 million, or 1%, to $16.3 million for the six month period ended June 25, 2005 primarily due to reduced sales, partly offset by higher gross margins due to favorable customer mix to the higher margin direct channel. Operating income increased $0.5 million for the six month period ended June 25, 2005 from a loss of $0.5 million for the six month period ended June 25, 2004, principally due to reduced operating expenses.

  Liquidity and Financial Position

Cash Flow for the Six Months Ended June 25, 2005 Versus the Six Months Ended June 25, 2004

  Cash Flow from Operating Activities

     Cash used by operating activities was $7.5 million for six month period ended June 25, 2005 and cash provided by operating activities was $29.4 million for six month period ended June 25, 2004.

     Net income for the six month period ended June 25, 2005 was $24.5 million higher than in 2004. Cash used by inventory was $18.0 million, an increase of $12.7 million from the $5.3 million used in 2004. The outflow resulted from inventory increases in 2005 to improve service levels in North America and to support new product offerings (Kensington mobility products and Dell peripheral contract, and binding and laminating products in the U.S.). Accounts payable used $16.7 million in cash, which was $19.9 million more than 2004, on earlier inventory replenishment and associated vendor payments. Additional uses of cash included accrued bonus and executive management incentives payments which were higher than the prior year due to overachievement of 2004 targets and a reduction in customer program accruals due to 2005 payments of 2004 earned programs which were higher than the prior year. Cash provided by accounts receivable of $48.5 million, an increase of $23.3 million over 2004, resulted primarily from the resolution of fourth quarter 2004 customer billing delays following the company’s September 2004 systems implementation in the U.S. (which delayed receipt of payments to the first quarter of 2005) and a shift in timing of some collections due to the adverse impact of customer consolidations on negotiated payment terms.

  Cash Flow from Investing Activities

     Cash used by investing activities was $13.0 million for the six months ended June 25, 2005 versus cash provided of $4.4 million for the six months ended June 25, 2004. Gross capital expenditures were $12.8 million and $11.7 million for the six months ended June 25, 2005 and 2004, respectively. In the six months ended June 25, 2004, capital spending was partly offset by proceeds of $16.1 million, principally from the sale of buildings, machinery and other assets related to facility closures and plans to outsource previously manufactured products.

  Cash Flow from Financing Activities

     Cash used by financing activities was $38.2 million and $17.7 million for the six months ended June 25, 2005 and 2004, respectively. The change in this account is driven by intercompany dividends received (primarily from foreign subsidiaries) of $118.3 million and $25.8 million for the six months ended June 25, 2005 and 2004, respectively, partially offset by increased borrowing from the parent to fund working capital funds required by ACCO World (as described above).

  Adequacy of Liquidity Sources

     The Company believes that its internally generated funds, together with access to global credit markets, are adequate to meet its long- and short-term capital needs, including those that will result from its financing. However, the Company’s cash flows from operations, borrowing availability and overall liquidity are subject to certain risks and uncertainties, including those described in its filings with the Securities and Exchange Commission.

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Item 3. Quantitative and Qualitative Disclosures about Market Risk

     The Company is exposed to various market risks, including changes in foreign currency exchange rates. Market risk is the potential loss arising from adverse changes in market rates and prices, such as foreign currency exchange. The Company does not enter into derivatives or other financial instruments for trading or speculative purposes. The Company enters into financial instruments to manage and reduce the impact of changes in foreign currency exchange rates on foreign currency denominated purchases. The counterparties are major financial institutions.

          The office products industry is concentrated in a small number of major customers, principally office products superstores, large retailers, wholesalers and contract stationers. Customer consolidation and share growth of private-label products continue to increase pricing pressures, which may adversely affect margins for the Company and its competitors. The Company is addressing these challenges through design innovations, value-added features and services, as well as continued cost and asset reduction.

   Foreign Exchange Risk Management

     The Company enters into forward exchange contracts principally to hedge currency fluctuations in transactions denominated in foreign currencies, thereby limiting the risk that would otherwise result from changes in exchange rates, primarily relating to anticipated inventory purchases. The Company does not enter into financial instruments for trading or speculative purposes. The majority of the Company’s exposure to currency movements is in Europe (Pound Sterling and Euro), Australia, Canada and Mexico. All of the foreign exchange contracts have maturity dates in 2005 and 2006. Increases and decreases in the fair market values of the forward agreements are expected to be offset by gains/losses in recognized net underlying foreign currency transactions. Selected information related to ACCO World’s foreign exchange contracts as of June 25, 2005 is as follows (all items except exchange rates in millions):

	Average				Fair
Forward contracts as of	Exchange		Notional		Market		Gain
June 25, 2005	Rate		Amount		Value		(Loss)
Currency Sold
Sell Euro/Buy USD		1.28	$	4.2	$	4.3	$	0.1
Sell GBP/Buy USD		1.85		21.0		21.5		0.5
Sell Euro/Buy GBP		0.70		1.7		1.8		0.1
Other				0.8		0.8
Total			$	27.7	$	28.4	$	0.7

   Interest Rate Risk Management

     The preparation of the financial statements and this Management’s Discussion and Analysis of Financial Conditions and Results of Operations of the Company includes an allocation to the Company of a proportion of Fortune Brands, Inc. total interest expense. Interest expense associated with Fortune Brands, Inc.’ outstanding debt has been allocated to the Company based upon average net assets of the Company as a percentage of average net assets of Fortune Brands, Inc.. However, no debt has been allocated to the Company in relation to this expense. This is not indicative of the results of operations, liquidity or financial position that would have existed or will exist in the future assuming the Company businesses were operated as an independent company.

   Forward – Looking Statements

     “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere in this report contain, and other periodic reports and press releases of the Company may contain, certain “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of

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1995, and is including this statement for purposes of invoking these safe harbor provisions. These forward-looking statements, which are based on certain assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “forecast,” “project,” “plan,” or similar expressions. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain and actual results may differ from those predicted. The Company undertakes no obligation to update these forward-looking statements in the future. Among the factors that could cause plans, actions and results to differ materially from current expectations are: competition within the office products, document finishing and film lamination industries; the effects of economic and political conditions; the ability of distributors to successfully market and sell our products; the availability and price of raw materials; dependence on certain suppliers of manufactured products; the effect of consolidation in the office products industry; the risk that the businesses will not be integrated successfully following business combinations; the risk that the cost savings and any synergies from any business combination may not be fully realized or may take longer to realize than expected; disruption from any business combination making it more difficult to maintain relationships with customers, employees or suppliers; as well as other risks and uncertainties detailed from time to time in the Company’s Securities and Exchange Commission filings.

Item 4. Controls and Procedures

     (a) Evaluation of Disclosure Controls and Procedures.

The Company’s management has evaluated, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15e under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by the Report.

     (b) Changes in Internal Control Over Financial Reporting.

There have not been any changes in the Company’s internal control over financial reporting that occurred during the Company’s fiscal quarter ending June 25, 2005 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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Part II            OTHER INFORMATION

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

     Prior to the Distribution, Fortune Brands, as majority shareholder of the Company and acting by written consent as permitted by Delaware law, approved the following matters on the dates indicated: (1) on March 15, 2005, the Agreement and Plan of Merger, dated as of March 15, 2005, by and among Fortune Brands, the Company, Gemini Acquisition Sub, Inc. and GBC (the “Merger Agreement”); (2) on July 15, 2005, Amendment to the Merger Agreement; (3) on August 8, 2005, the ACCO Brands Corporation 2005 Long-Term Incentive Plan, the ACCO Brands Corporation 2005 Assumed Option and Restricted Stock Unit Plan and its related Sub-Plan A, and the ACCO Brands Corporation Annual Executive Incentive Compensation Plan; and (4) on August 15, 2005, the restated Certificate of Incorporation of the Company.

ITEM 6. Exhibits (numbered in accordance with item 601 of Regulation S-K).

Exhibit 2.1:	Agreement and Plan of Merger, dated as of March 15, 2005, by and among Fortune Brands, Inc. (“Fortune”), ACCO Brands Corporation (“ACCO”), Gemini Acquisition Sub, Inc. (“Acquisition Sub”) and General Binding Corporation (“GBC”), incorporated by reference herein to Annex A to ACCO’s Registration Statement on Form S-4/A (Registration No. 333-124946).
Exhibit 2.2:	Amendment to Agreement and Plan of Merger, dated as of August 4, 2005, by and among Fortune, ACCO, Acquisition Sub and GBC, incorporated by reference herein to Exhibit 2.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 2.3:	Distribution Agreement, dated as of March 15, 2005, by and between Fortune and ACCO, incorporated by reference herein to Annex B to ACCO’s Registration Statement on Form S-4/A (Registration No. 333-124946).
Exhibit 2.4:	Amendment to Distribution Agreement, dated as of August 4, 2005, by and between Fortune and ACCO, incorporated by reference herein to Exhibit 2.2 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 3.1:	Restated Certificate of Incorporation of ACCO, incorporated by reference herein to Exhibit 3.1 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 3.2:	Certificate of Designation of Series A Junior Participating Preferred Stock of ACCO, incorporated by reference herein to Exhibit 3.2 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 3.2:	Amended By-laws of ACCO, incorporated by reference herein to Exhibit 3.3 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 4.1:	Rights Agreement, dated as of August 16, 2005, by and between ACCO and Wells Fargo Bank, National Association, as Rights Agent, incorporated by reference herein to Exhibit 4.1 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 4.2:	Escrow Agreement, dated as of August 5, 2005, by and among Citibank, N.A., Agency & Trust, ACCO Finance I, Inc. (“Finance”), ACCO and Wachovia Bank, National Association, incorporated by reference herein to Exhibit 4.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 4.3:	Indenture, dated as of August 5, 2005, by and between Finance and Wachovia Bank, National Association, as trustee, incorporated by reference herein to Exhibit 4.2 to ACCO’s Current Report on Form 8-K dated August 8, 2005.

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Exhibit 4.4:	Supplemental Indenture, dated as of August 17, 2005, by and among ACCO, the Guarantors signatory thereto and Wachovia Bank, National Association, as Trustee, incorporated by reference herein to Exhibit 4.1 to ACCO’s Current Report on Form 8-K dated August 23, 2005.
Exhibit 4.4:	Form of 7 5/8% Senior Subordinated Note due 2015 (included in Exhibit 4.3 hereto).
Exhibit 4.5:	Registration Rights Agreement, dated as of August 5, 2005, by and among Finance and the Initial Purchasers listed therein, incorporated by reference herein to Exhibit 4.4 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 4.6:	Joinder Agreement, dated as of August 17, 2005, by and among ACCO, the Guarantors signatory thereto and Citigroup Global Markets Inc. and Goldman, Sachs & Co., as representatives of the Initial Purchasers, incorporated by reference herein to Exhibit 4.2 to ACCO’s Current Report on Form 8-K dated August 23, 2005.
Exhibit 10.1:	Credit Agreement, dated as of August 17, 2005, by and among ACCO, ACCO Brands Europe Ltd., Furlon Holding B.V. (to be renamed ACCO Nederland Holdings B.V.) and the lenders and issuers party hereto, Citicorp North America, Inc., as Administrative Agent, and ABN AMRO Bank, N.V., as Syndication Agent, incorporated by reference herein to Exhibit 10.1 to ACCO’s Current Report on Form 8-K dated August 23, 2005.
Exhibit 10.2:	ACCO Brands Corporation 2005 Long-Term Incentive Plan, incorporated by reference herein to Exhibit 10.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 10.3:	ACCO Brands Corporation 2005 Assumed Option and Restricted Stock Unit Plan, together with Sub-Plan A thereto, incorporated by reference herein to Exhibit 10.2 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 10.4:	Copy of resolutions of the Board of Directors of ACCO, adopted August 3, 2005, approving the conversion to ACCO stock options of certain stock options granted pursuant to the Fortune Brands, Inc. 1999 Long-Term Incentive Plan (the “Fortune 1999 LTIP”), the Fortune Brands, Inc. 2003 Long-Term Incentive Plan (the “Fortune 2003 LTIP”), the General Binding Corporation 1989 Stock Option Plan, as amended and restated (the “GBC 1989 Stock Option Plan”), the General Binding Corporation 2001 Stock Incentive Plan for Employees (the “GBC 2001 Stock Plan”) and the General Binding Corporation Non-Employee Directors 2001 Stock Option Plan (the “GBC 2001 Directors Plan”) and the conversion to ACCO restricted stock units of certain restricted stock units that did not vest in full upon consummation of the merger of Acquisition Sub and GBC.
Exhibit 10.5:	Form of Nonqualified Stock Option Award Notice and Terms and Conditions for awards under the Fortune 2003 LTIP, incorporated herein by reference to Exhibit 10a1 to Fortune’s Quarterly Report on Form 10-Q dated November 9, 2004 (File No. 1-9076).
Exhibit 10.6:	Form of Nonqualified Stock Option Award Notice and Terms and Conditions for awards under the Fortune 2003 LTIP.
Exhibit 10.7:	Form of Incentive Stock Option Award Notice and Terms and Conditions for awards under the Fortune 2003 LTIP, incorporated herein by reference to Exhibit 10b1 to Fortune’s Quarterly Report on Form 10-Q dated November 9, 2004 (File No. 1-9076).
Exhibit 10.8:	Forms of Nonqualified Stock Option Award Notices and Terms and Conditions for awards under the Fortune 1999 LTIP.
Exhibit 10.9:	Forms of Incentive Stock Option Award Notices and Terms and Conditions for awards under the Fortune 1999 LTIP.

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Exhibit 10.10:	Form of Stock Option Agreement for options granted on February 23, 2005 under the GBC 2001 Stock Plan, incorporated herein by reference to Exhibit 10.3 to GBC’s Current Report on Form 8-K dated March 21, 2005 (File No. 000-02604).
Exhibit 10.11:	Form of Stock Option Agreement for options granted under the GBC 2001 Stock Plan.
Exhibit 10.12:	Form of Stock Option Agreement for options granted under the GBC 1989 Stock Option Plan.
Exhibit 10.13:	Forms of Stock Option Agreements for options granted under the GBC 2001 Directors Plan.
Exhibit 10.14:	Form of 2005 Restricted Stock Unit Grant Notice for restricted stock units awarded on February 23, 2005 under the GBC 2001 Stock Plan, incorporated herein by reference to Exhibit 10.5 to GBC’s Current Report on Form 8-K dated March 21, 2005 (File No. 000-02604).
Exhibit 10.15:	Form of 2004 Restricted Stock Unit Grant Notice for restricted stock units awarded on February 26, 2004 under the GBC 2001 Stock Plan.
Exhibit 10.16:	ACCO Brands Corporation Annual Executive Incentive Compensation Plan, incorporated by reference herein to Exhibit 10.3 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 10.17:	Tax Allocation Agreement, dated as of August 16, 2005, by and between Fortune and ACCO, incorporated by reference herein to Exhibit 10.1 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 10.18:	Tax Allocation Agreement, dated as of August 16, 2005, by and between GBC and Lane Industries, Inc., incorporated by reference herein to Exhibit 10.2 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 10.19:	Executive Severance/Change in Control Agreement, dated as of August 26, 2000, by and between Steven Rubin and GBC, incorporated by reference herein to Exhibit 10.15 to GBC’s Annual Report on Form 10-K dated March 15, 2005.
Exhibit 10.20:	Executive Severance/Change in Control Agreement, dated as of August 26, 2000, by and between John E. Turner and GBC, incorporated by reference herein to Exhibit 10.18 to GBC’s Annual Report on Form 10-K dated March 15, 2005.
Exhibit 18.1:	Letter regarding change in accounting principle from PricewaterhouseCoopers LLP dated August 29, 2005.
Exhibit 31.1:	Certificate of Chief Executive Officer required under Section 302 of the Sarbanes-Oxley Act of 2002.
Exhibit 31.2:	Certificate of Chief Financial Officer required under Section 302 of the Sarbanes-Oxley Act of 2002.
Exhibit 32.1:	CEO Certificate required under Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 32.2:	CFO Certificate required under Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 99:	Purchase Agreement dated as of August 2, 2005 by and among Finance and the Initial Purchasers listed therein, incorporated by reference herein to Exhibit 99.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ACCO BRANDS CORPORATION
By:	/s/	David D. Campbell
		David D. Campbell
		Chairman of the Board and Chief
		Executive Officer
By:	/s/	Neal V. Fenwick
		Neal V. Fenwick
		Executive Vice President and Chief
		Financial Officer
		August 29, 2005

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EXHIBIT INDEX

Exhibit 2.1:	Agreement and Plan of Merger, dated as of March 15, 2005, by and among Fortune Brands, Inc. (“Fortune”), ACCO Brands Corporation (“ACCO”), Gemini Acquisition Sub, Inc. (“Acquisition Sub”) and General Binding Corporation (“GBC”), incorporated by reference herein to Annex A to ACCO’s Registration Statement on Form S-4/A (Registration No. 333-124946).
Exhibit 2.2:	Amendment to Agreement and Plan of Merger, dated as of August 4, 2005, by and among Fortune, ACCO, Acquisition Sub and GBC, incorporated by reference herein to Exhibit 2.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 2.3:	Distribution Agreement, dated as of March 15, 2005, by and between Fortune and ACCO, incorporated by reference herein to Annex B to ACCO’s Registration Statement on Form S-4/A (Registration No. 333-124946).
Exhibit 2.4:	Amendment to Distribution Agreement, dated as of August 4, 2005, by and between Fortune and ACCO, incorporated by reference herein to Exhibit 2.2 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 3.1:	Restated Certificate of Incorporation of ACCO, incorporated by reference herein to Exhibit 3.1 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 3.2:	Certificate of Designation of Series A Junior Participating Preferred Stock of ACCO, incorporated by reference herein to Exhibit 3.2 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 3.2:	Amended By-laws of ACCO, incorporated by reference herein to Exhibit 3.3 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 4.1:	Rights Agreement, dated as of August 16, 2005, by and between ACCO and Wells Fargo Bank, National Association, as Rights Agent, incorporated by reference herein to Exhibit 4.1 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 4.2:	Escrow Agreement, dated as of August 5, 2005, by and among Citibank, N.A., Agency & Trust, ACCO Finance I, Inc. (“Finance”), ACCO and Wachovia Bank, National Association, incorporated by reference herein to Exhibit 4.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 4.3:	Indenture, dated as of August 5, 2005, by and between Finance and Wachovia Bank, National Association, as trustee, incorporated by reference herein to Exhibit 4.2 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 4.4:	Supplemental Indenture, dated as of August 17, 2005, by and among ACCO, the Guarantors signatory thereto and Wachovia Bank, National Association, as Trustee, incorporated by reference herein to Exhibit 4.1 to ACCO’s Current Report on Form 8-K dated August 23, 2005.
Exhibit 4.4:	Form of 7 5/8% Senior Subordinated Note due 2015 (included in Exhibit 4.3 hereto).
Exhibit 4.5:	Registration Rights Agreement, dated as of August 5, 2005, by and among Finance and the Initial Purchasers listed therein, incorporated by reference herein to Exhibit 4.4 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 4.6:	Joinder Agreement, dated as of August 17, 2005, by and among ACCO, the Guarantors signatory thereto and Citigroup Global Markets Inc. and Goldman, Sachs & Co., as representatives of the Initial Purchasers, incorporated by reference herein to Exhibit 4.2 to ACCO’s Current Report on Form 8-K dated August 23, 2005.

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Exhibit 10.1:	Credit Agreement, dated as of August 17, 2005, by and among ACCO, ACCO Brands Europe Ltd., Furlon Holding B.V. (to be renamed ACCO Nederland Holdings B.V.) and the lenders and issuers party hereto, Citicorp North America, Inc., as Administrative Agent, and ABN AMRO Bank, N.V., as Syndication Agent, incorporated by reference herein to Exhibit 10.1 to ACCO’s Current Report on Form 8-K dated August 23, 2005.
Exhibit 10.2:	ACCO Brands Corporation 2005 Long-Term Incentive Plan, incorporated by reference herein to Exhibit 10.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 10.3:	ACCO Brands Corporation 2005 Assumed Option and Restricted Stock Unit Plan, together with Sub-Plan A thereto, incorporated by reference herein to Exhibit 10.2 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 10.4:	Copy of resolutions of the Board of Directors of ACCO, adopted August 3, 2005, approving the conversion to ACCO stock options of certain stock options granted pursuant to the Fortune Brands, Inc. 1999 Long-Term Incentive Plan (the “Fortune 1999 LTIP”), the Fortune Brands, Inc. 2003 Long-Term Incentive Plan (the “Fortune 2003 LTIP”), the General Binding Corporation 1989 Stock Option Plan, as amended and restated (the “GBC 1989 Stock Option Plan”), the General Binding Corporation 2001 Stock Incentive Plan for Employees (the “GBC 2001 Stock Plan”) and the General Binding Corporation Non-Employee Directors 2001 Stock Option Plan (the “GBC 2001 Directors Plan”) and the conversion to ACCO restricted stock units of certain restricted stock units that did not vest in full upon consummation of the merger of Acquisition Sub and GBC.
Exhibit 10.5:	Form of Nonqualified Stock Option Award Notice and Terms and Conditions for awards under the Fortune 2003 LTIP, incorporated herein by reference to Exhibit 10a1 to Fortune’s Quarterly Report on Form 10-Q dated November 9, 2004 (File No. 1-9076).
Exhibit 10.6:	Form of Nonqualified Stock Option Award Notice and Terms and Conditions for awards under the Fortune 2003 LTIP.
Exhibit 10.7:	Form of Incentive Stock Option Award Notice and Terms and Conditions for awards under the Fortune 2003 LTIP, incorporated herein by reference to Exhibit 10b1 to Fortune’s Quarterly Report on Form 10-Q dated November 9, 2004 (File No. 1-9076).
Exhibit 10.8:	Forms of Nonqualified Stock Option Award Notices and Terms and Conditions for awards under the Fortune 1999 LTIP.
Exhibit 10.9:	Forms of Incentive Stock Option Award Notices and Terms and Conditions for awards under the Fortune 1999 LTIP.
Exhibit 10.10:	Form of Stock Option Agreement for options granted on February 23, 2005 under the GBC 2001 Stock Plan, incorporated herein by reference to Exhibit 10.3 to GBC’s Current Report on Form 8-K dated March 21, 2005 (File No. 000-02604).
Exhibit 10.11:	Form of Stock Option Agreement for options granted under the GBC 2001 Stock Plan.
Exhibit 10.12:	Form of Stock Option Agreement for options granted under the GBC 1989 Stock Option Plan.
Exhibit 10.13:	Forms of Stock Option Agreements for options granted under the GBC 2001 Directors Plan.
Exhibit 10.14:	Form of 2005 Restricted Stock Unit Grant Notice for restricted stock units awarded on February 23, 2005 under the GBC 2001 Stock Plan, incorporated herein by reference to Exhibit 10.5 to GBC’s Current Report on Form 8-K dated March 21, 2005 (File No. 000-02604).

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Exhibit 10.15:	Form of 2004 Restricted Stock Unit Grant Notice for restricted stock units awarded on February 26, 2004 under the GBC 2001 Stock Plan.
Exhibit 10.16:	ACCO Brands Corporation Annual Executive Incentive Compensation Plan, incorporated by reference herein to Exhibit 10.3 to ACCO’s Current Report on Form 8-K dated August 8, 2005.
Exhibit 10.17:	Tax Allocation Agreement, dated as of August 16, 2005, by and between Fortune and ACCO, incorporated by reference herein to Exhibit 10.1 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 10.18:	Tax Allocation Agreement, dated as of August 16, 2005, by and between GBC and Lane Industries, Inc., incorporated by reference herein to Exhibit 10.2 to ACCO’s Current Report on Form 8-K dated August 17, 2005.
Exhibit 10.19:	Executive Severance/Change in Control Agreement, dated as of August 26, 2000, by and between Steven Rubin and GBC, incorporated by reference herein to Exhibit 10.15 to GBC’s Annual Report on Form 10-K dated March 15, 2005.
Exhibit 10.20:	Executive Severance/Change in Control Agreement, dated as of August 26, 2000, by and between John E. Turner and GBC, incorporated by reference herein to Exhibit 10.18 to GBC’s Annual Report on Form 10-K dated March 15, 2005.
Exhibit 18.1:	Letter regarding change in accounting principles from PricewaterhouseCoopers LLP dated August 29, 2005.
Exhibit 31.1:	Certificate of Chief Executive Officer required under Section 302 of the Sarbanes-Oxley Act of 2002.
Exhibit 31.2:	Certificate of Chief Financial Officer required under Section 302 of the Sarbanes-Oxley Act of 2002.
Exhibit 32.1:	CEO Certificate required under Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 32.2:	CFO Certificate required under Section 906 of the Sarbanes-Oxley Act of 2002
Exhibit 99:	Purchase Agreement dated as of August 2, 2005 by and among Finance and the Initial Purchasers listed therein, incorporated by reference herein to Exhibit 99.1 to ACCO’s Current Report on Form 8-K dated August 8, 2005.

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EX-10.4

Exhibit 10.4

Resolutions Adopted by the Board of Directors

of ACCO World Corporation on August 3, 2005

          RESOLVED, that the assignment to and assumption by this Company, (i) effective as of the Time of Distribution (as defined in the Distribution Agreement, dated as of March 15, 2005, as amended, by and between Fortune Brands, Inc. (“Fortune”) and this Company (the “Distribution Agreement”)), of options to purchase from Fortune a number of shares of Common Stock, par value $3.125 per share, of Fortune, granted pursuant to Fortune’s 2003 Long-Term Incentive Plan or 1999 Long-Term Incentive Plan (together, the “Fortune Stock Plans”) that are outstanding and unvested immediately prior to the Time of Distribution (as defined in the Distribution Agreement) (“Fortune Options”) that become options (each, a “Fortune Converted Option”) to purchase a certain number of shares of Common Stock, par value $.01 per share, of this Company (“Company Common Stock”) and (ii) effective as of the Effective Time (as defined in the Merger Agreement, dated as of March 15, 2005, by and among, Fortune, this Company, Gemini Acquisition Sub, Inc., a Delaware corporation, and General Binding Corporation (“GBC”) (the “Merger Agreement”), of GBC Stock Options (as defined in the Merger Agreement) that become GBC Converted Options (as defined in the Merger Agreement), is approved, each Fortune Converted Option or GBC Converted Option, as applicable, to have substantially the same terms and conditions as the corresponding Fortune Option or GBC Stock Option, as applicable, except that (A) references to Fortune or GBC will be changed to refer to this Company for all purposes under each Fortune Converted Option or GBC Converted Option and all outstanding stock option agreements relating thereto and (B) all references to any of the Fortune Stock Plans or GBC Stock Plans (as defined in the Merger Agreement), as applicable, in the Fortune Converted Options or GBC Converted Options and all outstanding stock option agreements relating thereto shall be to the ACCO Brands Corporation 2005 Assumed Option and Restricted Stock Unit Plan and the ACCO Brands Corporation 2005 Assumed Option and Restricted Stock Unit Plan (Sub-Plan A), as applicable, to be approved and adopted by this Company.

          RESOLVED, that the assignment to and assumption by this Company, effective as of the Effective Time, of each restricted stock unit (“RSU”) issued by GBC pursuant to the GBC 2001 Stock Incentive Plan for Employees during 2004 that does not vest in full upon consummation of the Merger and that converts into an RSU with respect to one share of Company Common Stock and vests on February 26, 2007 (provided that the recipient is employed by GBC or an affiliate thereof as of such date) is approved, each such RSU that converts to have substantially the same terms and conditions as the corresponding RSU issued by GBC, except that (A) references to GBC will be changed to refer to this Company for all purposes under each such RSU that converts and (B) all references to the GBC 2001 Stock Incentive Plan in any GBC Restricted Stock Unit agreement evidencing any awards of such RSUs shall be to the ACCO Brands

Corporation 2005 Assumed Option and Restricted Stock Unit Plan and the ACCO Brands Corporation 2005 Assumed Option and Restricted Stock Unit Plan (Sub-Plan A) to be approved and adopted by this Company; and further

          RESOLVED, that the officers of this Company are authorized to make, execute and deliver, or cause to be made, executed and delivered, all such agreements, documents, instruments and other papers and to do or cause to be done all such acts and things, in the name and on behalf of this Company and under its corporate seal or otherwise, as may be deemed necessary, appropriate or desirable to effectuate or carry out the purposes and intent of the foregoing resolutions.

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EX-10.6

Exhibit 10.6

NOTICE OF NONQUALIFIED

STOCK OPTION AGREEMENT

September 29, 2003

Company: [	]	Date(s) First Exercisable:
Date of Grant: [	]	[     ] — September 29, 2004
No. of Shares: [	]	[     ] — September 29, 2005
Option Price per Share: [	]	[     ] — September 29, 2006

PERSONAL AND CONFIDENTIAL

[Name]
[Address]

Dear [       ]:

We are pleased to inform you that as a key employee of the company referred to above you have been granted a Nonqualified Stock Option by the Compensation and Stock Option Committee of the Board of Directors under the Fortune Brands, Inc. 2003 Long-Term Incentive Plan, as amended (the “Plan”).

These options are granted under and governed by the Plan and the September 2003 Nonqualified Stock Option Terms and Conditions (the “Terms”). For your information, we have attached to this notice the following documents: (1) the Terms, (2) the Plan, (3) the Plan Prospectus, and (4) Notice of Exercise of Stock Option and Notice of Exercise of Limited Right forms. You should review these documents carefully in order to fully understand how your option operates and your rights as an option recipient.

Under the terms of the 2003 Plan, you do not need to sign and return, or otherwise acknowledge your receiving, this notice. If you have any questions about your options, please contact Grace Cherico, Stock Plans Administrator, at (847) 484-4423.

Sincerely yours,

FORTUNE BRANDS, INC.

Senior Vice President — Strategy

and Corporate Development

SEPTEMBER 2003

NONQUALIFIED STOCK OPTION
TERMS AND CONDITIONS

As a participant in the 2003 Long-Term Incentive Plan (the Plan), you will be able to purchase shares of Common Stock of Fortune Brands, Inc. (Fortune). Subject to the terms and conditions below, the minimum amount that may be purchased at any one time is 50 shares unless you have fewer remaining shares covered by your option.

The date of the grant, the maximum number of shares the option entitles you to purchase, the option price per share and the date or dates on which the option will ordinarily be first exercisable are listed at the top of your Notice of Incentive Stock Option Award. The option is not intended (but not guaranteed) to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code.

          1. Exercise.

          (a) Except as provided in this paragraph 1 and paragraphs 3, 4, 5 and 9, the option shall be exercisable during the period beginning on the date or dates set forth under the heading “Date(s) First Exercisable” in the Notice of Incentive Stock Option Award and ending ten years from the date of grant (its expiration date). During this period, the option is exercisable in whole or in part from time to time in amounts of not less than 50 shares (except that if you have fewer than 50 shares remaining covered by the option, the option may be exercised for the full number of remaining shares).

          (b) The option shall not become exercisable unless you remain employed by Fortune or one of its subsidiaries for one year from the date of grant, except in the event of your death and except as provided in paragraph 9.

          2. Transferability of Option. The option shall not be transferable by you except in the event of your death. During your lifetime the option shall be exercisable only by you.

          3. Death. If your employment by Fortune or an entity in which Fortune has an equity interest terminates by reason of your death, the option may immediately be exercised in full and shall continue to be exercisable in full until its expiration date, provided that the option may be exercised within one year from the date of your death even if this one-year period extends beyond the expiration date.

          4. Retirement. If your employment by Fortune or an entity in which Fortune has an equity interest terminates by reason of disability or Retirement (as defined below), provided that you have remained in the employ of Fortune or an entity in which Fortune has an equity interest for one year from the date of grant, the option shall become immediately exercisable in full and shall continue to be exercisable in full until its expiration date. For purposes of this paragraph, Retirement means either (a) termination of employment on or after attaining age 55 and completion of at least ten years of service with Fortune or an entity in which Fortune has an equity interest, provided that Retirement shall not include termination of employment by reason of failure to maintain work performance standards, violation of company policies or dishonesty or other misconduct prejudicial to the company, or (b) retirement under Section 3(b) of the Fortune Brands, Inc. Supplemental Plan.

          5. Termination of Employment. If your employment by Fortune or a entity in which Fortune has an equity interest terminates other than in the circumstances referred to in paragraphs 3 and 4, any portion of the option that is not yet exercisable shall not thereafter become exercisable and any portion of the option that is exercisable shall terminate and cease to be exercisable three months from the date of your termination from employment, except as otherwise provided in paragraph 9; provided that in no event shall the option be exercisable after the expiration of ten years from the date of grant. For the purpose of these terms and conditions, your employment by an entity in which Fortune has an equity interest shall be considered terminated on the date on Fortune sells or otherwise divests its equity interest in your employer.

          6. Stock Exchange Listing. Fortune is not obligated to deliver any shares until they have been listed on each stock exchange on which Fortune’s common stock is listed and until Fortune is satisfied that all applicable laws and regulations have been met. Fortune agrees to use its best efforts to list the shares and meet all legal requirements so that the shares can be delivered. No fractional shares will be delivered.

          7. Transfer of Employment; Leave of Absence. For the purposes of your option, (a) if you transfer between Fortune and an entity in which Fortune has an equity interest or from one entity in which Fortune has an equity interest to another entity in which Fortune has an equity interest, without an intervening period, it will not be considered a termination of employment, and (b) any leave of absence granted in writing will not constitute an interruption in your employment.

          8. Adjustments.

          (a) In the event of any merger, consolidation, stock or other non-cash dividend, extraordinary cash dividend, split-up, spin-off, combination or exchange of shares, reorganization or recapitalization or change in capitalization, or any other similar

2

corporate event, the number and kind of shares that are subject to the option and the option price per share immediately prior to such event may be proportionately and appropriately adjusted, without increase or decrease in the aggregate option price.

          (b) The determination of the committee of the Board of Directors of Fortune administering the Plan (the Committee) as to the terms of any adjustment is binding and conclusive upon you and any other person who is entitled to exercise the option.

          9. Change in Control of Fortune.

          (a) In the event of a Change in Control (as defined in the attached Plan), your option, if it is not then immediately exercisable in full and provided that it has not expired, shall become immediately exercisable in full and shall remain exercisable in full. In addition, under certain circumstances as described in Section 12(b) of the attached Plan, you may have the right to receive cash instead of exercising your option. This right, called a Limited Right, may be automatically exercised under certain circumstances described in the attached Plan. You will be informed of any Change in Control.

          (b) Notwithstanding paragraphs 1(b), 3, 4 and 5, the provisions of this paragraph 9(b) will be applicable in the event of a termination of your employment during the 60-day period following a Change in Control. Your option shall not terminate or cease to be exercisable as a result of the termination of your employment during this period, but shall be exercisable in full throughout it; provided, however, that in no event shall your option be exercisable after ten years from its date of grant (except in the event of death as provided in paragraph 3 above). However, in the event that on the date of termination you have not held your option for more than six (6) months, the preceding sentence shall apply only if your employment has been terminated other than for just cause (as defined below) or you have voluntarily terminated your employment for certain reasons: (i) because you in good faith believe that as a result of the Change in Control you are unable effectively to discharge your duties or the duties of the position you occupied immediately prior to the Change in Control, or (ii) because of a reduction in your aggregate compensation or in your aggregate benefits below that in effect immediately prior to the Change in Control. For purposes of this paragraph, termination shall be for “just cause” only if it is based on fraud, misappropriation or embezzlement on your part which results in a final conviction of a felony. Nothing in this paragraph 9(b) limits any rights otherwise provided in the event of your death, disability or Retirement (as defined in paragraph 4 above), or your right to exercise your option following a termination of employment as provided in paragraph 5.

3

          10. Stockholder Rights. Neither you nor any other person shall have any rights of a stockholder as to shares under the option until, after proper exercise of the option, such shares shall have been recorded on Fortune’s official stockholder records as having been issued or transferred.

          11. Notice of Exercise. Subject to these terms and conditions, the option may be exercised, by a written notice of exercise on a form approved by the Committee that (i) is signed by the person or persons exercising the option, (ii) is delivered to the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), (iii) signifies election to exercise the option as indicated in the notice of exercise, (iv) states the number of shares as to which the option is being exercised, and (v) unless otherwise provided in the notice of exercise, is accompanied by payment in full of the option price of such shares. The notice of exercise may be delivered by facsimile transmission. Any notice of exercise delivered as required by this paragraph will be effective only in accordance with the provisions of and to the extent set forth in the notice of exercise. If a properly executed notice of exercise is not delivered to the Stock Plans Administrator (or other person designated by Fortune), by the applicable expiration date specified in paragraphs 3, 4, 5 and 9, the notice will be deemed null and void and of no effect. If notice of exercise of the option is given by a person other than you, Fortune may require as a condition to exercising the option that appropriate proof of the right of such person to exercise the option be submitted to Fortune. Certificates for any shares purchased upon exercise will be issued and delivered as soon as practicable.

          12. Exercise of Limited Right. In the event a Limited Right referred to in paragraph 9 becomes exercisable, it shall be exercised in whole or in part by giving written notice of such exercise, on a form approved by the Committee, to the Stock Plans Administrator (or other person designated by Fortune). No written notice is required if the Limited Right is automatically exercised as provided in Section 12(b) of the attached Plan. The exercise will be effective as of the date specified in the notice of exercise, but not earlier than the date the notice is actually received by the Stock Plans Administrator. The notice must be actually received by the Stock Plans Administrator by no later than the close of business on the last day of the applicable Limited Right Exercise Period, as defined in the attached Plan (or the date the related option expires, whichever is earlier).

          13. Payment of Option Price. You may pay the option price for shares (i) in cash, (ii) by the delivery of shares of Fortune Common Stock that have been held by you for at least one year and that have a total market value equal to the option price, or (iii) by a combination of cash and such shares that have been held by you for a period of at least one year and that have a total market value which, together with such cash, equals the option price. The “market value” of shares or per share of Fortune Common Stock as of any date means the value determined by reference to the closing price of a share of

4

Fortune Common Stock as finally reported on the New York Stock Exchange for the trading day next preceding such date. You may also pay the option price from the proceeds of the sale of shares covered by the option, called a cashless exercise, to the extent provided in the notice of exercise referred to in paragraph 11.

          14. Tax Withholding. Upon exercise of any portion of your option (or at such later time as taxable income from the exercise is deemed to be realized), Federal income tax withholding (and state and local income tax withholding, if applicable) may be required by the Company in respect of taxes on income realized by you. The Company may withhold such required amounts from your future paychecks or may require that you deliver to the Company the amounts to be withheld. In addition, you may pay the minimum required Federal income tax withholding (and state and local income tax withholding, if applicable) by electing either to have the Company withhold a portion of the shares of Common Stock otherwise issuable upon exercise of the option, or to deliver other shares of Common Stock owned by you, in either case having a fair market value (on the date that the amount of tax you have elected to have withheld is to be determined) of the minimum amount to be withheld, provided that the election shall be irrevocable and shall be subject to such rules as the Committee may adopt. You may also arrange to have such tax (or taxes) paid directly to the Company on your behalf from the proceeds of the sale of Common Stock to the extent provided in the notice of exercise referred to in paragraph 11.

5

EX-10.8

Exhibit 10.8

NONQUALIFIED

STOCK OPTION AGREEMENT

September 29, 2003

Company: [	]	Date(s) First Exercisable:
Date of Grant: [	]	[     ] — September 29, 2004
No. of Shares: [	]	[     ] — September 29, 2005
Option Price per Share: [	]	[     ] — September 29, 2006

PERSONAL AND CONFIDENTIAL

[Name]
[Address]

Dear [        ]:

We are pleased to inform you that as a key employee of the company referred to above you have been granted a Nonqualified Stock Option by the Compensation and Stock Option Committee of the Board of Directors under the Fortune Brands, Inc. 1999 Long-Term Incentive Plan, as amended (the “Plan”).

By your signature, you agree that these options are granted under and governed by the Plan and the September 2003 Nonqualified Stock Option Terms and Conditions (the “Terms”), and acknowledge receipt of: (1) the Terms, (2) the Plan, (3) the Plan Prospectus, (4) the April 30, 2003 Supplement to the Plan Prospectus and (5) Notice of Exercise of Stock Option and Notice of Exercise of Limited Right forms.

As set forth in paragraph 1 of the Terms, a signed copy of this agreement must be received by the Stock Plans Administrator at Fortune Brands, Inc., 300 Tower Parkway, Lincolnshire, IL 60069 before 5:00 p.m. on the 60^th day after the grant date. Failure to do so will terminate this option.

Sincerely yours,

FORTUNE BRANDS. INC.

Senior Vice President — Strategy and Corporate Development	Signature of Employee
	Date

SEPTEMBER 2003

NONQUALIFIED STOCK OPTION
TERMS AND CONDITIONS

As a participant in the 1999 Long-Term Incentive Plan (the Plan), you will be able to purchase shares of Common Stock of Fortune Brands, Inc. (Fortune) provided that you accept your award as set forth in paragraph 1 below. Subject to the terms and conditions below, the minimum amount, which may be purchased at any one time, is 50 shares unless you have fewer remaining shares covered by your option.

The date of the grant, the maximum number of shares the option entitles you to purchase, the option price per share and the date or dates on which the option will ordinarily be first exercisable are listed at the top of the agreement. The option is not intended to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code.

          1. Acceptance of Option. The option cannot be exercised unless you sign the agreement and return it so that it is received by the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), before 5:00 p.m. Illinois time on the 60th day after the date of grant. If the Stock Plans Administrator does not receive the signed agreement by this time, then the option will terminate immediately. Your signing and delivering a copy of the agreement to which these Terms and Conditions are attached will not commit you to purchase any of the shares under the option but will indicate your acceptance of the option upon these terms and conditions.

          2. Exercise.

          (a) Except as provided in this paragraph 2 and paragraphs 4, 5, 6 and 10, the option shall be exercisable during the period beginning on the date or dates set forth under the heading “Date(s) First Exercisable” in the agreement and ending ten years from the date of grant (its expiration date). During this period, the option is exercisable in whole or in part from time to time in amounts of not less than 50 shares (except that if you have fewer than 50 shares remaining covered by the option, the option may be exercised for the full number of remaining shares).

          (b) The option shall not become exercisable unless you remain employed by Fortune or one of its subsidiaries for one year from the date of grant, except in the event of your death and except as provided in paragraph 10.

          3. Transferability of Option. The option shall not be transferable by you otherwise than in the event of your death, except that it may be transferred by gift to any member of your immediate family or to a trust solely for the benefit of such immediate family members. During your lifetime, your Nonqualified Stock Option shall be exercisable only by you unless it has been transferred to a member of your immediate family or to a trust solely for the benefit of your immediate family members, in which case it may be exercisable only by such transferee. For the purpose of this provision, your immediate family shall mean your spouse, children and grandchildren.

          In addition, any transfer of your nonqualified stock option is subject to the following conditions:

     •   you must immediately notify the Stock Plans Administrator of Fortune of such transfer and provide such information about the transferee as the Stock Plans Administrator of Fortune may request (including, but not limited to, name of the transferee, address of the transferee, and taxpayer identification number);

     •   the transferee may not make any subsequent transfer;

     •   any shares issued to a transferee upon exercise may bear such legends as deemed appropriate by the Stock Plans Administrator of Fortune;

     •   the transferee may not utilize the “cashless exercise” feature;

     •   Fortune has no obligation to deliver any shares following an exercise until all applicable withholding taxes are satisfied;

     •   you agree to deliver a copy of the Nonqualified Stock Option Agreement, including any amendments thereto, to the transferee.

          4. Death. If your employment by Fortune or an entity in which Fortune has an equity interest terminates by reason of your death, the option may immediately be exercised in full and shall continue to be exercisable in full until its expiration date, provided that the option may be exercised within one year from the date of your death even if this one-year period extends beyond the expiration date.

          5. Retirement. If your employment by Fortune or an entity in which Fortune has an equity interest terminates by reason of disability or retirement under a retirement plan of Fortune or an entity in which it has an equity interest (provided that you have remained in the employ of Fortune or of an entity in which Fortune has an equity interest for one year from the date of grant), the option shall become immediately exercisable in full and shall continue to be exercisable in full until its expiration date.

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          6. Termination of Employment. If your employment by Fortune or a entity in which Fortune has an equity interest terminates other than in the circumstances referred to in paragraphs 4 and 5, any portion of the option that is not yet exercisable shall not thereafter become exercisable and any portion of the option that is exercisable shall terminate and cease to be exercisable three months from the date of your termination from employment, except as otherwise provided in paragraph 10; provided that in no event shall the option be exercisable after the expiration of ten years from the date of grant. For the purpose of the Agreement, your employment by an entity in which Fortune has an equity interest shall be considered terminated on the date on Fortune sells or otherwise divests its equity interest in your employer.

          7. Stock Exchange Listing. Fortune is not obligated to deliver any shares until they have been listed on each stock exchange on which Fortune’s common stock is listed and until Fortune is satisfied that all applicable laws and regulations have been met. Fortune agrees to use its best efforts to list the shares and meet all legal requirements so that the shares can be delivered. No fractional shares will be delivered.

          8. Transfer of Employment; Leave of Absence. For the purposes of your option, (a) if you transfer between Fortune and an entity in which Fortune has an equity interest or from one entity in which Fortune has an equity interest to another entity in which Fortune has an equity interest, without an intervening period, it will not be considered a termination of employment, and (b) any leave of absence granted in writing will not constitute an interruption in your employment.

          9. Adjustments.

          (a) In the event of any merger, consolidation, stock or other non-cash dividend, extraordinary cash dividend, split-up, spin-off, combination or exchange of shares, reorganization or recapitalization or change in capitalization, or any other similar corporate event, the number and kind of shares that are subject to the option and the option price per share immediately prior to such event may be proportionately and appropriately adjusted, without increase or decrease in the aggregate option price.

          (b) The determination of the committee of the Board of Directors of Fortune administering the Plan (the Committee) as to the terms of any adjustment is binding and conclusive upon you and any other person who is entitled to exercise the option.

          10. Change in Control of Fortune.

          (a) In the event of a Change in Control (as defined in the attached Plan), your option, if it is not then immediately exercisable in full and provided that it has not

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expired, shall become immediately exercisable in full and shall remain exercisable in full. In addition, under certain circumstances as described in Section 12(b) of the attached Plan, you may have the right to receive cash instead of exercising your option. This right, called a Limited Right, may be automatically exercised under certain circumstances described in the attached Plan. You will be informed of any Change in Control.

          (b) Notwithstanding paragraphs 2(b), 4, 5 and 6, the provisions of this paragraph 10(b) will be applicable in the event of a termination of your employment during the 60-day period following a Change in Control. Your option shall not terminate or cease to be exercisable as a result of the termination of your employment during this period, but shall be exercisable in full throughout it; provided, however, that in no event shall your option be exercisable after ten years from its date of grant (except in the event of death as provided in paragraph 4 above). However, in the event that on the date of termination you have not held your option for more than six (6) months, the preceding sentence shall apply only if your employment has been terminated other than for just cause (as defined below) or you have voluntarily terminated your employment for certain reasons: (i) because you in good faith believe that as a result of the Change in Control you are unable effectively to discharge your duties or the duties of the position you occupied immediately prior to the Change in Control, or (ii) because of a reduction in your aggregate compensation or in your aggregate benefits below that in effect immediately prior to the Change in Control. For purposes of this paragraph, termination shall be for “just cause” only if it is based on fraud, misappropriation or embezzlement on your part which results in a final conviction of a felony. Nothing in this paragraph 10(b) limits any rights otherwise provided in the event of your death, disability or retirement under a retirement plan of Fortune or an entity in which Fortune has an equity interest, or your right to exercise your option following a termination of employment as provided in paragraph 6.

          11. Stockholder Rights. Neither you nor any other person shall have any rights of a stockholder as to shares under the option until, after proper exercise of the option, such shares shall have been recorded on Fortune’s official stockholder records as having been issued or transferred.

          12. Notice of Exercise. Subject to these terms and conditions, the option may be exercised, by a written notice of exercise on a form approved by the Committee that (i) is signed by the person or persons exercising the option, (ii) is delivered to the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), (iii) signifies election to exercise the option as indicated in the notice of exercise, (iv) states the number of shares as to which the option is being exercised, and (v) unless otherwise provided in the notice of exercise, is accompanied by payment in full of the option price of such shares. The notice of exercise may be delivered by facsimile transmission. Any notice of exercise

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delivered as required by this paragraph will be effective only in accordance with the provisions of and to the extent set forth in the notice of exercise. If a properly executed notice of exercise is not delivered to the Stock Plans Administrator (or other person designated by Fortune), by the applicable expiration date specified in paragraphs 4, 5, 6 and 10, the notice will be deemed null and void and of no effect. If notice of exercise of the option is given by a person other than you, Fortune may require as a condition to exercising the option that appropriate proof of the right of such person to exercise the option be submitted to Fortune. Certificates for any shares purchased upon exercise will be issued and delivered as soon as practicable.

          13. Exercise of Limited Right. In the event a Limited Right referred to in paragraph 10 becomes exercisable, it shall be exercised in whole or in part by giving written notice of such exercise, on a form approved by the Committee, to the Stock Plans Administrator (or other person designated by Fortune). No written notice is required if the Limited Right is automatically exercised as provided in Section 12(b) of the attached Plan. The exercise will be effective as of the date specified in the notice of exercise, but not earlier than the date the notice is actually received by the Stock Plans Administrator. The notice must be actually received by the Stock Plans Administrator by no later than the close of business on the last day of the applicable Limited Right Exercise Period, as defined in the attached Plan (or the date the related option expires, whichever is earlier).

          14. Payment of Option Price. You may pay the option price for shares (i) in cash, (ii) by the delivery of shares of Fortune Common Stock that have been held by you for at least one year and that have a total market value equal to the option price, or (iii) by a combination of cash and such shares that have been held by you for a period of at least one year and that have a total market value which, together with such cash, equals the option price. The “market value” of shares or per share of Fortune Common Stock as of any date means the value determined by reference to the closing price of a share of Fortune Common Stock as finally reported on the New York Stock Exchange for the trading day next preceding such date. You may also pay the Option price from the proceeds of the sale of shares covered by the option, called a cashless exercise, to the extent provided in the notice of exercise referred to in paragraph 12.

          15. Tax Withholding. Upon exercise of any portion of your option (or at such later time as taxable income from the exercise is deemed to be realized), Federal income tax withholding (and state and local income tax withholding, if applicable) may be required by the Company in respect of taxes on income realized by you. The Company may withhold such required amounts from your future paychecks or may require that you deliver to the Company the amounts to be withheld. In addition, you may pay the minimum required Federal income tax withholding (and state and local income tax withholding, if applicable) by electing either to have the Company withhold a portion of the shares of Common Stock otherwise issuable upon exercise of the option, or

5

to deliver other shares of Common Stock owned by you, in either case having a fair market value (on the date that the amount of tax you have elected to have withheld is to be determined) of the minimum amount to be withheld, provided that the election shall be irrevocable and shall be subject to such rules as the Committee may adopt. You may also arrange to have such tax (or taxes) paid directly to the Company on your behalf from the proceeds of the sale of Common Stock to the extent provided in the notice of exercise referred to in paragraph 12.

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NONQUALIFIED

STOCK OPTION AGREEMENT

September 23, 2002

Company: [	]	Date(s) First Exercisable:
Date of Grant: [	]	[     ] — September 23, 2003
No. of Shares: [	]	[     ] — September 23, 2004
Option Price per Share[	]	[     ] — September 23, 2005

PERSONAL AND CONFIDENTIAL

[Name]
[Address]

Dear [        ]:

We are pleased to inform you that as a key employee of the company referred to above you have been granted a Nonqualified Stock Option by the Compensation and Stock Option Committee of the Board of Directors under the Fortune Brands, Inc. 1999 Long-Term Incentive Plan, as amended (the “Plan”).

By your signature, you agree that these options are granted under and governed by the Plan and the September 2002 Nonqualified Stock Option Terms and Conditions (the “Terms”), and acknowledge receipt of: (1) the Terms, (2) the Plan, (3) the Plan Prospectus, (4) the 2002 Supplement to the Plan Prospectus and (5) Notice of Exercise of Stock Option and Notice of Exercise of Limited Right forms.

As set forth in paragraph 1 of the Terms, a signed copy of this agreement must be received by the Stock Plans Administrator at Fortune Brands, Inc., 300 Tower Parkway, Lincolnshire, IL 60069 before 5:00 p.m. on the 60^th day after the grant date. Failure to do so will terminate this option.

Sincerely yours,

FORTUNE BRANDS, INC.

Senior Vice President — Strategy and Corporate Development	Signature of Employee
	Date

SEPTEMBER 2002

NONQUALIFIED STOCK OPTION
TERMS AND CONDITIONS

As a participant in the 1999 Long-Term Incentive Plan (the Plan), you will be able to purchase shares of Common Stock of Fortune Brands, Inc. (Fortune) provided that you accept your award as set forth in paragraph 1 below. Subject to the terms and conditions below, the minimum amount, which may be purchased at any one time, is 50 shares unless you have fewer remaining shares covered by your option.

The date of the grant, the maximum number of shares the option entitles you to purchase, the option price per share and the date or dates on which the option will ordinarily be first exercisable are listed at the top of the agreement. The option is intended not to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code.

          1. Acceptance of Option. The option cannot be exercised unless you sign the agreement and return it so that it is received by the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), before 5:00 p.m. Illinois time on the 60^th day after the date of grant. If the Stock Plans Administrator does not receive the signed agreement by this time, then the option will terminate immediately. Your signing and delivering a copy of the agreement to which these Terms and Conditions are attached will not commit you to purchase any of the shares under the option but will indicate your acceptance of the option upon these terms and conditions.

          2. Exercise.

          (a) Except as provided in this paragraph 2 and paragraphs 4, 5, 6 and 10, the option shall be exercisable during the period beginning on the date or dates set forth under the heading “Date(s) First Exercisable” in the agreement and ending ten years from the date of grant (its expiration date). During this period, the option is exercisable in whole or in part from time to time in amounts of not less than 50 shares (except that if you have fewer than 50 shares remaining covered by the option, the option may be exercised for the full number of remaining shares).

          (b) The option shall not become exercisable unless you remain employed by Fortune or one of its subsidiaries for one year from the date of grant, except in the event of your death and except as provided in paragraph 10.

          3. Transferability of Option. The option shall not be transferable by you except in the event of your death. During your lifetime the option shall be exercisable only by you.

          4. Death. If your employment by Fortune or a subsidiary terminates by reason of your death, the option may immediately be exercised in full and shall continue to be exercisable in full until its expiration date, provided that the option may be exercised within one year from the date of your death even if this one-year period extends beyond the expiration date.

          5. Retirement. If your employment by Fortune or a subsidiary terminates by reason of disability or retirement under a retirement plan of Fortune or a subsidiary (provided that you have remained in the employ of Fortune or one of its subsidiaries for one year from the date of grant), the option shall become immediately exercisable in full and shall continue to be exercisable in full until its expiration date.

          6. Termination of Employment. If your employment by Fortune or a subsidiary terminates other than in the circumstances referred to in paragraphs 4 and 5, any portion of the option that is not yet exercisable shall not thereafter become exercisable and any portion of the option that is exercisable shall terminate and cease to be exercisable three months from the date of your termination from employment, except as otherwise provided in paragraph 10; provided that in no event shall the option be exercisable after the expiration of ten years from the date of grant. For the purpose of the Agreement, your employment by a subsidiary of Fortune shall be considered terminated on the date that your employer is no longer a subsidiary (as defined in the Plan) of Fortune.

          7. Stock Exchange Listing. Fortune is not obligated to deliver any shares until they have been listed on each stock exchange on which Fortune’s common stock is listed and until Fortune is satisfied that all applicable laws and regulations have been met. Fortune agrees to use its best efforts to list the shares and meet all legal requirements so that the shares can be delivered. No fractional shares will be delivered.

          8. Transfer of Employment; Leave of Absence. For the purposes of your option, (a) if you transfer between Fortune and a subsidiary or from one subsidiary to another subsidiary, without an intervening period, it will not be considered a termination of employment, and (b) any leave of absence granted in writing will not constitute an interruption in your employment.

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          9. Adjustments.

          (a) In the event of any merger, consolidation, stock or other non-cash dividend, extraordinary cash dividend, split-up, spin-off, combination or exchange of shares, reorganization or recapitalization or change in capitalization, or any other similar corporate event, the number and kind of shares that are subject to the option and the option price per share immediately prior to such event may be proportionately and appropriately adjusted, without increase or decrease in the aggregate option price.

          (b) The determination of the committee of the Board of Directors of Fortune administering the Plan (the Committee) as to the terms of any adjustment is binding and conclusive upon you and any other person who is entitled to exercise the option.

          10. Change in Control of Fortune.

          (a) In the event of a Change in Control (as defined in the attached Plan), your option, if it is not then immediately exercisable in full and provided that it has not expired, shall become immediately exercisable in full and shall remain exercisable in full. In addition, under certain circumstances as described in Section 12(b) of the attached Plan, you may have the right to receive cash instead of exercising your option. This right, called a Limited Right, may be automatically exercised under certain circumstances described in the attached Plan. You will be informed of any Change in Control.

          (b) Notwithstanding paragraphs 2(b), 4, 5 and 6, the provisions of this paragraph 10(b) will be applicable in the event of a termination of your employment during the 60-day period following a Change in Control. Your option shall not terminate or cease to be exercisable as a result of the termination of your employment during this period, but shall be exercisable in full throughout it; provided, however, that in no event shall your option be exercisable after ten years from its date of grant (except in the event of death as provided in paragraph 4 above). However, in the event that on the date of termination you have not held your option for more than six (6) months, the preceding sentence shall apply only if your employment has been terminated other than for just cause (as defined below) or you have voluntarily terminated your employment for certain reasons: (i) because you in good faith believe that as a result of the Change in Control you are unable effectively to discharge your duties or the duties of the position you occupied immediately prior to the Change in Control, or (ii) because of a reduction in your aggregate compensation or in your aggregate benefits below that in effect immediately prior to the Change in Control. For purposes of this paragraph, termination shall be for “just cause” only if it is based on fraud, misappropriation or embezzlement on your part which results in a final conviction of a felony. Nothing in this paragraph 10(b) limits any rights otherwise provided in the event of your death, disability or retirement

3

under a retirement plan of Fortune or its subsidiary, or your right to exercise your option following a termination of employment as provided in paragraph 6,

          11. Stockholder Rights. Neither you nor any other person shall have any rights of a stockholder as to shares under the option until, after proper exercise of the option, such shares shall have been recorded on Fortune’s official stockholder records as having been issued or transferred.

          12. Notice of Exercise. Subject to these terms and conditions, the option may be exercised, by a written notice of exercise on a form approved by the Committee that (i) is signed by the person or persons exercising the option, (ii) is delivered to the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), (iii) signifies election to exercise the option as indicated in the notice of exercise, (iv) states the number of shares as to which the option is being exercised, and (v) unless otherwise provided in the notice of exercise, is accompanied by payment in full of the option price of such shares. The notice of exercise may be delivered by facsimile transmission. Any notice of exercise delivered as required by this paragraph will be effective only in accordance with the provisions of and to the extent set forth in the notice of exercise. If a properly executed notice of exercise is not delivered to the Stock Plans Administrator (or other person designated by Fortune), by the applicable expiration date specified in paragraphs 4, 5, 6 and 10, the notice will be deemed null and void and of no effect. If notice of exercise of the option is given by a person other than you, Fortune may require as a condition to exercising the option that appropriate proof of the right of such person to exercise the option be submitted to Fortune. Certificates for any shares purchased upon exercise will be issued and delivered as soon as practicable.

          13. Exercise of Limited Right. In the event a Limited Right referred to in paragraph 10 becomes exercisable, it shall be exercised in whole or in part by giving written notice of such exercise, on a form approved by the Committee, to the Stock Plans Administrator (or other person designated by Fortune). No written notice is required if the Limited Right is automatically exercised as provided in Section 12(b) of the attached Plan. The exercise will be effective as of the date specified in the notice of exercise, but not earlier than the date the notice is actually received by the Stock Plans Administrator. The notice must be actually received by the Stock Plans Administrator by no later than the close of business on the last day of the applicable Limited Right Exercise Period, as defined in the attached Plan (or the date the related option expires, whichever is earlier).

          14. Payment of Option Price. You may pay the option price for shares (i) in cash, (ii) by the delivery of shares of Fortune Common Stock that have been held by you for at least one year and that have a total market value equal to the option price, or (iii) by a combination of cash and such shares that have been held by you for a period of

4

at least one year and that have a total market value which, together with such cash, equals the option price. The “market value” of shares or per share of Fortune Common Stock as of any date means the value determined by reference to the closing price of a share of Fortune Common Stock as finally reported on the New York Stock Exchange for the trading day next preceding such date. You may also pay the option price from the proceeds of the sale of shares covered by the option, called a cashless exercise, to the extent provided in the notice of exercise referred to in paragraph 12.

          15. Tax Withholding. Upon exercise of any portion of your option (or at such later time as taxable income from the exercise is deemed to be realized), Federal income tax withholding (and state and local income tax withholding, if applicable) may be required by the Company in respect of taxes on income realized by you. The Company may withhold such required amounts from your future paychecks or may require that you deliver to the Company the amounts to be withheld. In addition, you may pay the minimum required Federal income tax withholding (and state and local income tax withholding, if applicable) by electing either to have the Company withhold a portion of the shares of Common Stock otherwise issuable upon exercise of the option, or to deliver other shares of Common Stock owned by you, in either case having a fair market value (on the date that the amount of tax you have elected to have withheld is to be determined) of the minimum amount to be withheld, provided that the election shall be irrevocable and shall be subject to such rules as the Committee may adopt. You may also arrange to have such tax (or taxes) paid directly to the Company on your behalf from the proceeds of the sale of Common Stock to the extent provided in the notice of exercise referred to in paragraph 12.

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EX-10.9

Exhibit 10.9

INCENTIVE

STOCK OPTION AGREEMENT

September 23, 2002

Company: [	]	Date(s) First Exercisable:
Date of Grant: [	]	[     ] — September 23, 2003
No. of Shares: [	]	[     ] — September 23, 2004
Option Price per Share[	]	[     ] — September 23, 2005

PERSONAL AND CONFIDENTIAL

[Name]
[Address]

Dear [       ]:

We are pleased to inform you that as a key employee of the company referred to above you have been granted an Incentive Stock Option by the Compensation and Stock Option Committee of the Board of Directors under the Fortune Brands, Inc. 1999 Long-Term Incentive Plan, as amended (the “Plan”).

By your signature, you agree that these options are granted under and governed by the Plan and the September 2002 Incentive Stock Option Terms and Conditions (the “Terms”), and acknowledge receipt of: (1) the Terms, (2) the Plan, (3) the Plan Prospectus, (4) the 2002 Supplement to the Plan Prospectus and (5) Notice of Exercise of Stock Option and Notice of Exercise of Limited Right forms.

As set forth in paragraph 1 of the Terms, a signed copy of this agreement must be received by the Stock Plans Administrator at Fortune Brands, Inc., 300 Tower Parkway, Lincolnshire, IL 60069 before 5:00 p.m. on the 60^th day after the grant date. Failure to do so will terminate this option.

Sincerely yours,

FORTUNE BRANDS, INC.

Senior Vice President — Strategy	Signature of Employee
and Corporate Development
	Date

SEPTEMBER 2002

INCENTIVE STOCK OPTION
TERMS AND CONDITIONS

As a participant in the 1999 Long-Term Incentive Plan (the Plan), you will be able to purchase shares of Common Stock of Fortune Brands, Inc. (Fortune) provided that you accept your award as set forth in paragraph 1 below. Subject to the terms and conditions below, the minimum amount, which may be purchased at any one time, is 50 shares unless you have fewer remaining shares covered by your option.

The date of the grant, the maximum number of shares the option entitles you to purchase, the option price per share and the date or dates on which the option will ordinarily be first exercisable are listed at the top of the agreement. The option is intended (but not guaranteed) to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code.

          1. Acceptance of Option. The option cannot be exercised unless you sign the agreement and return it so that it is received by the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), before 5:00 p.m. Illinois time on the 60th day after the date of grant. If the Stock Plans Administrator does not receive the signed agreement by this time, then the option will terminate immediately. Your signing and delivering a copy of the agreement to which these Terms and Conditions are attached will not commit you to purchase any of the shares under the option but will indicate your acceptance of the option upon these terms and conditions.

          2. Exercise.

          (a) Except as provided in this paragraph 2 and paragraphs 4, 5, 6 and 10, the option shall be exercisable during the period beginning on the date or dates set forth under the heading “Date(s) First Exercisable” in the agreement and ending ten years from the date of grant (its expiration date). During this period, the option is exercisable in whole or in part from time to time in amounts of not less than 50 shares (except that if you have fewer than 50 shares remaining covered by the option, the option may be exercised for the full number of remaining shares).

          (b) The option shall not become exercisable unless you remain employed by Fortune or one of its subsidiaries for one year from the date of grant, except in the event of your death and except as provided in paragraph 10.

          3. Transferability of Option. The option shall not be transferable by you except in the event of your death. During your lifetime the option shall be exercisable only by you.

          4. Death. If your employment by Fortune or a subsidiary terminates by reason of your death, the option may immediately be exercised in full and shall continue to be exercisable in full until its expiration date.

          5. Retirement. If your employment by Fortune or a subsidiary terminates by reason of disability or retirement under a retirement plan of Fortune or a subsidiary (provided that you have remained in the employ of Fortune or of one its subsidiaries for one year from the date of grant), the option shall become immediately exercisable in full and shall continue to be exercisable in full until its expiration date.

          6. Termination of Employment. If your employment by Fortune or a subsidiary terminates other than in the circumstances referred to in paragraphs 4 and 5, any portion of the option that is not yet exercisable shall not thereafter become exercisable and any portion of the option that is exercisable shall terminate and cease to be exercisable three months from the date of your termination from employment, except as otherwise provided in paragraph 10; provided that in no event shall the option be exercisable after the expiration of ten years from the date of grant. For the purpose of the Agreement, your employment by a subsidiary of Fortune shall be considered terminated on the date that your employer is no longer a subsidiary (as defined in the Plan) of Fortune.

          7. Stock Exchange Listing. Fortune is not obligated to deliver any shares until they have been listed on each stock exchange on which Fortune’s common stock is listed and until Fortune is satisfied that all applicable laws and regulations have been met. Fortune agrees to use its best efforts to list the shares and meet all legal requirements so that the shares can be delivered. No fractional shares will be delivered.

          8. Transfer of Employment; Leave of Absence. For the purposes of your option, (a) if you transfer between Fortune and a subsidiary or from one subsidiary to another subsidiary, without an intervening period, it will not be considered a termination of employment and (b) any leave of absence granted in writing will not constitute an interruption in your employment.

          9. Adjustments.

          (a) In the event of any merger, consolidation, stock or other non-cash dividend, extraordinary cash dividend, split-up, spin-off, combination or exchange of shares, reorganization or recapitalization or change in capitalization, or any other similar

2

corporate event, the number and kind of shares that are subject to the option and the option price per share immediately prior to such event may be proportionately and appropriately adjusted, without increase or decrease in the aggregate option price.

          (b) The determination of the committee of the Board of Directors of Fortune administering the Plan (the Committee) as to the terms of any adjustment is binding and conclusive upon you and any other person who is entitled to exercise the option.

          10. Change in Control of Fortune.

          (a) In the event of a Change in Control (as defined in the attached Plan), your option, if it is not then immediately exercisable in full and provided that it has not expired, shall become immediately exercisable in full and shall remain exercisable in full. In addition, under certain circumstances as described in Section 12(b) of the attached Plan, you may have the right to receive cash instead of exercising your option. This right, called a Limited Right, may be automatically exercised under certain circumstances described in the attached Plan. You will be informed of any Change in Control.

          (b) Notwithstanding paragraphs 2(b), 4, 5 and 6, the provisions of this paragraph 10(b) will be applicable in the event of a termination of your employment during the 60-day period following a Change in Control. Your option shall not terminate or cease to be exercisable as a result of the termination of your employment during this period, but shall be exercisable in full throughout it; provided, however, that in no event shall your option be exercisable after ten years from its date of grant. However, in the event that on the date of termination you have not held your option for more than six (6) months, the preceding sentence shall apply only if your employment has been terminated other than for just cause (as defined below) or you have voluntarily terminated your employment for certain reasons: (i) because you in good faith believe that as a result of the Change in Control you are unable effectively to discharge your duties or the duties of the position you occupied immediately prior to the Change in Control, or (ii) because of a reduction in your aggregate compensation or in your aggregate benefits below that in effect immediately prior to the Change in Control. For purposes of this paragraph, termination shall be for “just cause” only if it is based on fraud, misappropriation or embezzlement on your part which results in a final conviction of a felony. Nothing in this paragraph 10(b) limits any rights otherwise provided in the event of your death, disability or retirement under a retirement plan of Fortune or its subsidiary, or your right to exercise your option following a termination of employment as provided in paragraph 6.

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          11. Stockholder Rights. Neither you nor any other person shall have any rights of a stockholder as to shares under the option until, after proper exercise of the option, such shares shall have been recorded on Fortune’s official stockholder records as having been issued or transferred.

          12. Notice of Exercise. Subject to these terms and conditions, the option may be exercised, by a written notice of exercise on a form approved by the Committee that (i) is signed by the person or persons exercising the option, (ii) is delivered to the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), (iii) signifies election to exercise the option as indicated in the notice of exercise, (iv) states the number of shares as to which the option is being exercised, and (v) unless otherwise provided in the notice of exercise, is accompanied by payment in full of the option price of such shares. The notice of exercise may be delivered by facsimile transmission. Any notice of exercise delivered as required by this paragraph will be effective only in accordance with the provisions of and to the extent set forth in the notice of exercise. If a properly executed notice of exercise is not delivered to the Stock Plans Administrator (or other person designated by Fortune), by the applicable expiration date specified in paragraphs 4, 5, 6 and 10, the notice will be deemed null and void and of no effect. If notice of exercise of the option is given by a person other than you, Fortune may require as a condition to exercising the option that appropriate proof of the right of such person to exercise the option be submitted to Fortune. Certificates for any shares purchased upon exercise will be issued and delivered as soon as practicable.

          13. Exercise of Limited Right. In the event a Limited Right referred to in paragraph 10 becomes exercisable, it shall be exercised in whole or in part by giving written notice of such exercise, on a form approved by the Committee, to the Stock Plans Administrator (or other person designated by Fortune). No written notice is required if the Limited Right is automatically exercised as provided in Section 12(b) of the attached Plan. The exercise will be effective as of the date specified in the notice of exercise, but not earlier than the date the notice is actually received by the Stock Plans Administrator. The notice must be actually received by the Stock Plans Administrator by no later than the close of business on the last day of the applicable Limited Right Exercise Period, as defined in the attached Plan (or the date the related option expires, whichever is earlier).

          14. Payment of Option Price. You may pay the option price for shares (i) in cash, (ii) by the delivery of shares of Fortune Common Stock that have been held by you for at least one year and that have a total market value equal to the option price, or (iii) by a combination of cash and such shares that have been held by you for a period of at least one year and that have a total market value which, together with such cash, equals the option price. The “market value” of shares or per share of Fortune Common Stock as of any date means the value determined by reference to the closing price of a share of

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Fortune Common Stock as finally reported on the New York Stock Exchange for the trading day next preceding such date. You may also pay the option price from the proceeds of the sale of shares covered by the option, called a cashless exercise, to the extent provided in the notice of exercise referred to in paragraph 12.

          15. Tax Withholding. You agree to notify the Stock Plans Administrator in the event the shares acquired by you upon exercise of any portion of your option are sold or otherwise disposed of within one year from the date of exercise. If and to the extent Federal income tax withholding (and state and local income tax withholding, if applicable) may be required by the Company in respect of taxes on income realized by you upon or after exercise of any portion of the option, or upon disposition of the shares acquired thereby, the Company may withhold such required amounts from your future paychecks or may require that you deliver to the Company the amounts to be withheld. In addition, you may pay the minimum required Federal income tax withholding (and state and local income tax withholding, if applicable) by electing either to have the Company withhold a portion of the shares of Common Stock otherwise issuable upon exercise of the option, or to deliver other shares of Common Stock owned by you, in either case having a fair market value (on the date that the withholding amount is to be determined) of the minimum amount required to be withheld, provided that the election shall be irrevocable and shall be subject to such rules as the Committee may adopt. You may also arrange to have any tax (or taxes) paid directly to the Company on your behalf from the proceeds of the sale of Common Stock to the extent provided in the notice of exercise referred to in paragraph 12.

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INCENTIVE

STOCK OPTION AGREEMENT

September 29, 2003

Company: [	]	Date(s) First Exercisable:
Date of Grant: [	]	[     ] — September 29, 2004
No. of Shares: [	]	[     ] — September 29, 2005
Option Price per Share: [	]	[     ] — September 29, 2006

PERSONAL AND CONFIDENTIAL

[Name]
[Address]

Dear [      ]:

We are pleased to inform you that as a key employee of the company referred to above you have been granted an Incentive Stock Option by the Compensation and Stock Option Committee of the Board of Directors under the Fortune Brands, Inc. 1999 Long-Term Incentive Plan, as amended (the “Plan”).

By your signature, you agree that these options are granted under and governed by the Plan and the September 2003 Incentive Stock Option Terms and Conditions (the “Terms”), and acknowledge receipt of: (1) the Terms, (2) the Plan, (3) the Plan Prospectus, (4) the April 29, 2003 Supplement to the Plan Prospectus and (5) Notice of Exercise of Stock Option and Notice of Exercise of Limited Right forms.

As set forth in paragraph 1 of the Terms, a signed copy of this agreement must be received by the Stock Plans Administrator at Fortune Brands, Inc., 300 Tower Parkway, Lincolnshire, IL 60069 before 5:00 p.m. on the 60^th day after the grant date. Failure to do so will terminate this option.

Sincerely yours,

FORTUNE BRANDS, INC.

Senior Vice President — Strategy	Signature of Employee
and Corporate Development
	Date

SEPTEMBER 2003

INCENTIVE STOCK OPTION
TERMS AND CONDITIONS

As a participant in the 1999 Long-Term Incentive Plan (the Plan), you will be able to purchase shares of Common Stock of Fortune Brands, Inc. (Fortune) provided that you accept your award as set forth in paragraph 1 below. Subject to the terms and conditions below, the minimum amount, which may be purchased at any one time, is 50 shares unless you have fewer remaining shares covered by your option.

The date of the grant, the maximum number of shares the option entitles you to purchase, the option price per share and the date or dates on which the option will ordinarily be first exercisable are listed at the top of the agreement. The option is intended (but not guaranteed) to be an incentive stock option within the meaning of Section 422 of the Internal Revenue Code.

          1. Acceptance of Option. The option cannot be exercised unless you sign the agreement and return it so that it is received by the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), before 5:00 p.m. Illinois time on the 60th day after the date of grant. If the Stock Plans Administrator does not receive the signed agreement by this time, then the option will terminate immediately. Your signing and delivering a copy of the agreement to which these Terms and Conditions are attached will not commit you to purchase any of the shares under the option but will indicate your acceptance of the option upon these terms and conditions.

          2. Exercise.

          (a) Except as provided in this paragraph 2 and paragraphs 4, 5, 6 and 10, the option shall be exercisable during the period beginning on the date or dates set forth under the heading “Date(s) First Exercisable” in the agreement and ending ten years from the date of grant (its expiration date). During this period, the option is exercisable in whole or in part from time to time in amounts of not less than 50 shares (except that if you have fewer than 50 shares remaining covered by the option, the option may be exercised for the full number of remaining shares).

          (b) The option shall not become exercisable unless you remain employed by Fortune or one of its subsidiaries for one year from the date of grant, except in the event of your death and except as provided in paragraph 10.

          3. Transferability of Option. The option shall not be transferable by you except in the event of your death. During your lifetime the option shall be exercisable only by you.

          4. Death. If your employment by Fortune or an entity in which Fortune has an equity interest terminates by reason of your death, the option may immediately be exercised in full and shall continue to be exercisable in full until its expiration date.

          5. Retirement. If your employment by Fortune or an entity in which Fortune has an equity interest terminates by reason of disability or retirement under a retirement plan of Fortune or an entity in which it has an equity interest (provided that you have remained in the employ of Fortune or of an entity in which Fortune has an equity interest for one year from the date of grant), the option shall become immediately exercisable in full and shall continue to be exercisable in full until its expiration date.

          6. Termination of Employment. If your employment by Fortune or a entity in which Fortune has an equity interest terminates other than in the circumstances referred to in paragraphs 4 and 5, any portion of the option that is not yet exercisable shall not thereafter become exercisable and any portion of the option that is exercisable shall terminate and cease to be exercisable three months from the date of your termination from employment, except as otherwise provided in paragraph 10; provided that in no event shall the option be exercisable after the expiration of ten years from the date of grant. For the purpose of the Agreement, your employment by an entity in which Fortune has an equity interest shall be considered terminated on the date on Fortune sells or otherwise divests its equity interest in your employer.

          7. Stock Exchange Listing. Fortune is not obligated to deliver any shares until they have been listed on each stock exchange on which Fortune’s common stock is listed and until Fortune is satisfied that all applicable laws and regulations have been met. Fortune agrees to use its best efforts to list the shares and meet all legal requirements so that the shares can be delivered. No fractional shares will be delivered.

          8. Transfer of Employment; Leave of Absence. For the purposes of your option, (a) if you transfer between Fortune and an entity in which Fortune has an equity interest or from one entity in which Fortune has an equity interest to another entity in which Fortune has an equity interest, without an intervening period, it will not be considered a termination of employment, and (b) any leave of absence granted in writing will not constitute an interruption in your employment.

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          9. Adjustments.

          (a) In the event of any merger, consolidation, stock or other non-cash dividend, extraordinary cash dividend, split-up, spin-off, combination or exchange of shares, reorganization or recapitalization or change in capitalization, or any other similar corporate event, the number and kind of shares that are subject to the option and the option price per share immediately prior to such event may be proportionately and appropriately adjusted, without increase or decrease in the aggregate option price.

          (b) The determination of the committee of the Board of Directors of Fortune administering the Plan (the Committee) as to the terms of any adjustment is binding and conclusive upon you and any other person who is entitled to exercise the option.

          10. Change in Control of Fortune.

          (a) In the event of a Change in Control (as defined in the attached Plan), your option, if it is not then immediately exercisable in full and provided that it has not expired, shall become immediately exercisable in full and shall remain exercisable in full. In addition, under certain circumstances as described in Section 12(b) of the attached Plan, you may have the right to receive cash instead of exercising your option. This right, called a Limited Right, may be automatically exercised under certain circumstances described in the attached Plan. You will be informed of any Change in Control.

          (b) Notwithstanding paragraphs 2(b), 4, 5 and 6, the provisions of this paragraph 10(b) will be applicable in the event of a termination of your employment during the 60-day period following a Change in Control. Your option shall not terminate or cease to be exercisable as a result of the termination of your employment during this period, but shall be exercisable in full throughout it; provided, however, that in no event shall your option be exercisable after ten years from its date of grant. However, in the event that on the date of termination you have not held your option for more than six (6) months, the preceding sentence shall apply only if your employment has been terminated other than for just cause (as defined below) or you have voluntarily terminated your employment for certain reasons: (i) because you in good faith believe that as a result of the Change in Control you are unable effectively to discharge your duties or the duties of the position you occupied immediately prior to the Change in Control, or (ii) because of a reduction in your aggregate compensation or in your aggregate benefits below that in effect immediately prior to the Change in Control. For purposes of this paragraph, termination shall be for “just cause” only if it is based on fraud, misappropriation or embezzlement on your part which results in a final conviction of a felony. Nothing in this paragraph 10(b) limits any rights otherwise provided in the event of your death, disability or retirement under a retirement plan of Fortune or an entity in

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which Fortune has an equity interest, or your right to exercise your option following a termination of employment as provided in paragraph 6.

          11. Stockholder Rights. Neither you nor any other person shall have any rights of a stockholder as to shares under the option until, after proper exercise of the option, such shares shall have been recorded on Fortune’s official stockholder records as having been issued or transferred.

          12. Notice of Exercise. Subject to these terms and conditions, the option may be exercised, by a written notice of exercise on a form approved by the Committee that (i) is signed by the person or persons exercising the option, (ii) is delivered to the Stock Plans Administrator of Fortune, 300 Tower Parkway, Lincolnshire, Illinois (or to such other person and place as Fortune may specify in writing), (iii) signifies election to exercise the option as indicated in the notice of exercise, (iv) states the number of shares as to which the option is being exercised, and (v) unless otherwise provided in the notice of exercise, is accompanied by payment in full of the option price of such shares. The notice of exercise may be delivered by facsimile transmission. Any notice of exercise delivered as required by this paragraph will be effective only in accordance with the provisions of and to the extent set forth in the notice of exercise. If a properly executed notice of exercise is not delivered to the Stock Plans Administrator (or other person designated by Fortune), by the applicable expiration date specified in paragraphs 4, 5, 6 and 10, the notice will be deemed null and void and of no effect. If notice of exercise of the option is given by a person other than you, Fortune may require as a condition to exercising the option that appropriate proof of the right of such person to exercise the option be submitted to Fortune. Certificates for any shares purchased upon exercise will be issued and delivered as soon as practicable.

          13. Exercise of Limited Right. In the event a Limited Right referred to in paragraph 10 becomes exercisable, it shall be exercised in whole or in part by giving written notice of such exercise, on a form approved by the Committee, to the Stock Plans Administrator (or other person designated by Fortune). No written notice is required if the Limited Right is automatically exercised as provided in Section 12(b) of the attached Plan. The exercise will be effective as of the date specified in the notice of exercise, but not earlier than the date the notice is actually received by the Stock Plans Administrator. The notice must be actually received by the Stock Plans Administrator by no later than the close of business on the last day of the applicable Limited Right Exercise Period, as defined in the attached Plan (or the date the related option expires, whichever is earlier).

          14. Payment of Option Price. You may pay the option price for shares (i) in cash, (ii) by the delivery of shares of Fortune Common Stock that have been held by you for at least one year and that have a total market value equal to the option price, or (iii) by a combination of cash and such shares that have been held by you for a period of

4

at least one year and that have a total market value which, together with such cash, equals the option price. The “market value” of shares or per share of Fortune Common Stock as of any date means the value determined by reference to the closing price of a share of Fortune Common Stock as finally reported on the New York Stock Exchange for the trading day next preceding such date. You may also pay the option price from the proceeds of the sale of shares covered by the option, called a cashless exercise, to the extent provided in the notice of exercise referred to in paragraph 12.

          15. Tax Withholding. You agree to notify the Stock Plans Administrator in the event the shares acquired by you upon exercise of any portion of your option are sold or otherwise disposed of within one year from the date of exercise. If and to the extent Federal income tax withholding (and state and local income tax withholding, if applicable) may be required by the Company in respect of taxes on income realized by you upon or after exercise of any portion of the option, or upon disposition of the shares acquired thereby, the Company may withhold such required amounts from your future paychecks or may require that you deliver to the Company the amounts to be withheld. In addition, you may pay the minimum required Federal income tax withholding (and state and local income tax withholding, if applicable) by electing either to have the Company withhold a portion of the shares of Common Stock otherwise issuable upon exercise of the option, or to deliver other shares of Common Stock owned by you, in either case having a fair market value (on the date that the withholding amount is to be determined) of the minimum amount required to be withheld, provided that the election shall be irrevocable and shall be subject to such rules as the Committee may adopt. You may also arrange to have any tax (or taxes) paid directly to the Company on your behalf from the proceeds of the sale of Common Stock to the extent provided in the notice of exercise referred to in paragraph 12.

5

EX-10.11

Exhibit 10.11

STOCK OPTION AGREEMENT

TO:

OPTION DATE:

EXPIRATION DATE:

     In order to provide additional incentive through stock ownership for key employees of General Binding Corporation and Subsidiaries (“GBC” or the “Company”) you are hereby granted an Option by GBC, effective as of the Option Date, to purchase ___shares of GBC Common Stock at a price per share of $ ___which is one hundred percent (100%) of the Fair Market Value of GBC Common Stock on the Option Date, subject to the terms and conditions set forth in the “General Binding Corporation 2001 Stock Option Plan for Employees” (“Plan”).

     Except as hereinafter provided, with respect to the Option granted hereunder, vesting shall occur at a rate of twenty-five percent (25%) per year beginning on the first anniversary of the Option Date described above and each subsequent anniversary of the Option Date, provided you remain an employee of GBC.

     The Option is exercisable at any time after one (1) year following the Option Date, in whole or in part, but only if all of the following conditions are met at the time of exercise:

(i)	the Option, or part thereof, is vested as described above;
(ii)	the date of exercise is on or before the Expiration Date set forth above; and
(iii)	you are an employee of GBC, or if you are no longer an employee, the date of exercise is in accordance with the Plan.

     In the event of a Change in Control of GBC as defined in the Plan, all Options subject to this Agreement shall vest 100%, whereupon all Options shall become exercisable in full from the effective date of the Change in Control.

     The manner in which you may exercise this Option is by giving written notice to the Vice President, Secretary and General Counsel of GBC accompanied by either 1.) a check in payment of the option price ($          per share) for the number of shares of the Option being exercised as provided in the Plan, or 2.) tendering a sufficient number of previously-acquired shares of GBC Common Stock with a fair market value equal (subject to adjustment for fractional shares) to the cost of the Option being exercised, or any combination of the foregoing. In addition to the Option price, you must also pay or provide for required withholding taxes. For purposes of this Agreement, “previously-acquired shares” means shares purchased on the open market, or shares purchased from the Company (including by exercise of this or any other option) which have been held for at least six (6) months.

     The Plan provides that no Option may be exercised unless the Plan is in full compliance with all laws and regulations applicable thereto. At the present time this condition is met and GBC will endeavor to keep the Plan in compliance.

     No amendment, modification, or waiver of this Option in whole or in part shall be binding unless consented to in writing by either the Chairman or the President of GBC, and no amendment may cause any participant to be unfavorably affected with respect to any Option already granted hereunder.

     In order to exercise this Option you must be employed by GBC or its subsidiaries at the time of exercise. If you cease to be so employed your Option will terminate on the date of termination of employment, except as provided in the Plan.

     Under current provisions of the Internal Revenue Code, when an Option is exercised by you, you will receive ordinary taxable income equal to the amount, if any, by which the fair market value on the date of exercise exceeds the Option price. In the event federal, state, or local taxes are required by law to be withheld with respect to any exercise of an Option under this Agreement, GBC shall have the authority, without your consent, to deduct or withhold, or require you to remit to GBC, an amount sufficient to satisfy such taxes, which amount may, if you elect, include previously-acquired shares or shares otherwise issuable upon exercise of this Option, which, in either case, have a fair market value equal to not more than the minimum required withholding taxes. Any gain or loss upon a sale of the shares issued to you upon exercise of the Option will be treated as long-term or short-term capital gain or loss depending upon then existing tax laws. The basis of the shares for determining gain or loss at the time of sale will be their fair market value on the date of exercise. Tax laws may change and tax treatment must be determined in accordance with current tax laws. Company counsel should be consulted on your ability to sell your shares.

     This Agreement and the Plan are not intended to qualify for treatment under the provisions of the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”). This Agreement shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. To the extent not preempted by federal law, this Agreement shall be governed by, and construed in accordance with the laws of the State of Illinois.

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     Please sign the copy of this Option agreement and return it to the Vice President, Human Resources, thereby indicating your understanding of and agreement with its terms and conditions. Unless signed and returned by mail or otherwise within thirty (30) days from date of mailing or delivery to you of this agreement, this Option may be deemed withdrawn at the option of GBC. By signing this Agreement you acknowledge receipt of a copy of the Plan. The terms of the Plan shall have precedence over any terms in this Agreement that are inconsistent therewith.

GENERAL BINDING CORPORATION
By:
	President &
	Chief Executive Officer

TO:	Vice President, Human Resources
	General Binding Corporation

I hereby agree to the terms and conditions of this Stock Option Agreement. I also hereby acknowledge receipt of a copy of the General Binding Corporation 2001 Stock Option Plan for Employees, and, having read it, I hereby signify my understanding or, and my agreement with its terms and conditions.

Employee

Date

3

EX-10.12

Exhibit 10.12

STOCK OPTION

TO: [      ]

OPTION DATE: [      ]

     In order to provide additional incentive through stock ownership for certain key employees of General Binding Corporation and Subsidiaries (“GBC”) you are hereby granted an Option by GBC, effective as of the date hereof, to purchase [ ] shares of GBC Common Stock at a price per share of $[ ] subject to the terms and conditions set forth in the “General Binding Corporation 1989 Stock Option Plan (“Plan”).

     This option must be exercised in parts as provided in the Plan, beginning no sooner than one year hence, and completed no later than eight years hereafter, after which this Option will lapse. No part of this Option is transferable or assignable in whole or in part by you during your lifetime, and no part can be exercised by you after termination or employment except in the event of retirement, death or disability.

     The manner in which you may exercise this Option is by giving written notice to the Vice President, Secretary and General Counsel of GBC accompanied by either 1.) a check in payment of the option price ($[ ] per share) for the number of shares of the Option being exercised as provided in the Plan, or 2.) tendering a sufficient number of shares of GBC Common Stock with a fair market value equal (subject to adjustment for fractional shares) to the cost of the Option being exercised, or any combination of the foregoing.

     The Plan provides that no Option may be exercised unless the Plan is in full compliance with all laws and regulations applicable thereto. At the present time this condition is met and GBC will endeavor to keep the Plan in compliance.

     No amendment, modification, or waiver of this Option in whole or in part shall be binding unless consented to in writing by either the Chairman or the President of GBC, and no amendment may cause any participant to be unfavorable affected with respect to any Option already granted hereunder.

     In order to exercise this Option you must be employed by GBC or its subsidiaries at the time of exercise. If you cease to be so employed, except in the event of retirement, death or disability, your Option will terminate on the date of termination of employment.

     Under current provisions of the Internal Revenue Code, when an Option is exercised by you, you will receive ordinary taxable income equal to the amount, if any, by which the fair market value on the date of exercise exceeds the option price. Any gain or loss upon a sale of the shares will be treated as long-term or short-term capital gain or loss depending upon then existing tax laws. The basis of the stock for determining gain or loss at the time of sale will be its fair market value on the date of exercise. Tax laws may change and tax treatment must be determined in accordance with current tax laws. Company counsel should be consulted on your ability to sell your shares.

     Please sign the copy of this Option agreement and return it to the Vice President, Human Resources, thereby indicating your understanding of and agreement with its terms and conditions. Unless signed and returned by mail or otherwise within thirty (30) days from date of mailing or delivery to you of this agreement this Option may be deemed withdrawn at the option of GBC. By signing this Agreement you acknowledge receipt of a copy of the Plan. The terms of the Plan shall have precedence over any terms in this Agreement that are inconsistent therewith.

GENERAL BINDING CORPORATION
By:
	Govi C. Reddy
	President and Chief Executive Officer

TO:	Vice President, Human Resources
	General Binding Corporation

I hereby agree to the terms and conditions of this Stock Option Agreement. I also hereby acknowledge receipt of a copy of the General Binding Corporation 1989 Stock Option Plan, and, having read it, I hereby signify my understanding or, and my agreement with, its terms and conditions.

[      ]

Date

EX-10.13

Exhibit 10.13

STOCK OPTION AGREEMENT

(FORMULA OPTION)

TO:

OPTION DATE:

EXPIRATION DATE:

     In order to provide additional incentive through stock ownership for the members of the Board of Directors of General Binding Corporation (“GBC” or the “Company”) you are hereby granted an Option by GBC, effective as of the Option Date, to purchase 3,000 shares of GBC Common Stock at a price per share of $ ___which is one hundred percent (100%) of the Fair Market Value of GBC Common Stock on the Option Date, subject to the terms and conditions set forth in the “General Binding Corporation Non-Employee Directors 2001 Stock Option Plan” (“Plan”).

     Except as hereinafter provided, with respect to the Option granted hereunder, such option shall vest and become exercisable on the first anniversary of the Option Date described above provided you remain on the Board of Directors of GBC.

     The Option is exercisable at any time after one (1) year following the Option Date, in whole or in part, but only if all of the following conditions are met at the time of exercise:

(i)	the Option, or part thereof, is vested as described above;
(ii)	the date of exercise is on or before the Expiration Date set forth above; and
(iii)	you are a member of the Board of Directors of GBC, or if you are no longer a Director, the date of exercise is in accordance with the Plan.

     In the event of a Change in Control of GBC as defined in the Plan, all Options subject to this Agreement shall vest 100%, whereupon all Options shall become exercisable in full from the effective date of the Change in Control.

     The manner in which you may exercise this Option is by giving written notice to the Vice President, Secretary and General Counsel of GBC accompanied by either 1.) a check in payment of the option price ($       per share) for the number of shares of the Option being exercised as provided in the Plan, or 2.) tendering a sufficient number of previously-acquired shares of GBC Common Stock with a fair market value equal (subject to adjustment for fractional shares) to the cost of the Option being exercised, or any combination of the foregoing. For purposes of this Agreement, “previously-acquired shares” means shares purchased on the open market, or shares purchased from the Company (including by exercise of this or any other option) which have been held for at least six (6) months.

     The Plan provides that no Option may be exercised unless the Plan is in full compliance with all laws and regulations applicable thereto. At the present time this condition is met and GBC will endeavor to keep the Plan in compliance.

     No amendment, modification, or waiver of this Option in whole or in part shall be binding unless consented to in writing by either the Chairman or the President of GBC, and no amendment may cause any participant to be unfavorably affected with respect to any Option already granted hereunder.

     Under current provisions of the Internal Revenue Code, when an Option is exercised by you, you will receive ordinary taxable income equal to the amount, if any, by which the fair market value on the date of exercise exceeds the Option price. In the event federal, state, or local taxes are required by law to be withheld with respect to any exercise of an Option under this Agreement, GBC shall have the authority, without your consent, to deduct or withhold, or require you to remit to GBC, an amount sufficient to satisfy such taxes, which amount may, if you elect, include previously-acquired shares or shares otherwise issuable upon exercise of this Option, which, in either case, have a fair market value equal to not more than the minimum required withholding taxes. Any gain or loss upon a sale of the shares issued to you upon exercise of the Option will be treated as long-term or short-term capital gain or loss depending upon then existing tax laws. The basis of the shares for determining gain or loss at the time of sale will be their fair market value on the date of exercise. Tax laws may change and tax treatment must be determined in accordance with current tax laws. Company counsel should be consulted on your ability to sell your shares.

     This Agreement and the Plan are not intended to qualify for treatment under the provisions of the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”). This Agreement shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. To the extent not preempted by federal law, this Agreement shall be governed by and construed in accordance with the laws of the State of Illinois.

     Please sign the copy of this Option agreement and return it to the Company’s Vice President, Secretary & General Counsel, thereby indicating your understanding of and agreement with its terms and conditions. Unless signed and returned by mail or otherwise within thirty (30) days from date of mailing or delivery to you of this agreement, this Option may be deemed

2

withdrawn at the option of GBC. By signing this Agreement you acknowledge receipt of a copy of the Plan. The terms of the Plan shall have precedence over any terms in this Agreement that are inconsistent therewith.

GENERAL BINDING CORPORATION
By:
	Chairman

TO:	Vice President, Secretary & General Counsel
	General Binding Corporation

I hereby agree to the terms and conditions of this Stock Option Agreement. I also hereby acknowledge receipt of a copy of the General Binding Corporation Non-Employee Directors 2001 Stock Option Plan, and, having read it, I hereby signify my understanding of, and my agreement with its terms and conditions.

Director

Date

3

STOCK OPTION AGREEMENT

(DISCRETIONARY OPTION)

TO:

OPTION DATE:

VESTING DATE:

EXPIRATION DATE:

     In order to provide additional incentive through stock ownership for members of the Board of Directors of General Binding Corporation (“GBC” or the “Company”) you are hereby granted an Option by GBC, effective as of the Option Date, to purchase ___shares of GBC Common Stock at a price per share of $ ___which is one hundred percent (100%) of the Fair Market Value of GBC Common Stock on the Option Date, subject to the terms and conditions set forth in the “General Binding Corporation Non-Employee Directors 2001 Stock Option Plan” (“Plan”).

     Except as hereinafter provided, with respect to the Option granted hereunder, such option shall vest and become exercisable on the six month anniversary of the Option Date described above provided you remain on the Board of Directors.

     The Option is exercisable at any time after the Vesting Date described above, in whole or in part, but only if all of the following conditions are met at the time of exercise:

(i)	the Option, or part thereof, is vested as described above;
(ii)	the date of exercise is on or before the Expiration Date set forth above; and
(iii)	you are a member of the Board of Directors of GBC, or if you are no longer an employee, the date of exercise is in accordance with the Plan.

     In the event of a Change in Control of GBC as defined in the Plan, all Options subject to this Agreement shall vest 100%, whereupon all Options shall become exercisable in full from the effective date of the Change in Control.

     The manner in which you may exercise this Option is by giving written notice to the Vice President, Secretary and General Counsel of GBC accompanied by either 1.) a check in payment of the option price ($         per share) for the number of shares of the Option being exercised as provided in the Plan, or 2.) tendering a sufficient number of previously-acquired shares of GBC Common Stock with a fair market value equal (subject to adjustment for fractional shares) to the cost of the Option being exercised, or any combination of the foregoing. For purposes of this Agreement, “previously-acquired shares” means shares purchased on the open market, or shares purchased from the Company (including by exercise of this or any other option) which have been held for at least six (6) months.

     The Plan provides that no Option may be exercised unless the Plan is in full compliance with all laws and regulations applicable thereto. At the present time this condition is met and GBC will endeavor to keep the Plan in compliance.

     No amendment, modification, or waiver of this Option in whole or in part shall be binding unless consented to in writing by either the Chairman or the President of GBC, and no amendment may cause any participant to be unfavorably affected with respect to any Option already granted hereunder.

     Under current provisions of the Internal Revenue Code, when an Option is exercised by you, you will receive ordinary taxable income equal to the amount, if any, by which the fair market value on the date of exercise exceeds the Option price. In the event federal, state, or local taxes are required by law to be withheld with respect to any exercise of an Option under this Agreement, GBC shall have the authority, without your consent, to deduct or withhold, or require you to remit to GBC, an amount sufficient to satisfy such taxes, which amount may, if you elect, include previously-acquired shares or shares otherwise issuable upon exercise of this Option, which, in either case, have a fair market value equal to not more than the minimum required withholding taxes. Any gain or loss upon a sale of the shares issued to you upon exercise of the Option will be treated as long-term or short-term capital gain or loss depending upon then existing tax laws. The basis of the shares for determining gain or loss at the time of sale will be their fair market value on the date of exercise. Tax laws may change and tax treatment must be determined in accordance with current tax laws. Company counsel should be consulted on your ability to sell your shares.

     This Agreement and the Plan are not intended to qualify for treatment under the provisions of the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”). This Agreement shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. To the extent not preempted by federal law, this Agreement shall be governed by, and construed in accordance with the laws of the State of Illinois.

     Please sign the copy of this Option agreement and return it to the Company’s Vice President, Secretary & General Counsel, thereby indicating your understanding of and agreement with its terms and conditions. Unless signed and returned by mail or otherwise within thirty (30) days from date of mailing or delivery to you of this agreement, this Option may be deemed withdrawn at the option of GBC. By signing this Agreement you acknowledge

2

receipt of a copy of the Plan. The terms of the Plan shall have precedence over any terms in this Agreement that are inconsistent therewith.

GENERAL BINDING CORPORATION
By:
	Chairman

TO:	Vice President, Secretary & General Counsel
	General Binding Corporation

I hereby agree to the terms and conditions of this Stock Option Agreement. I also hereby acknowledge receipt of a copy of the General Binding Corporation Non-Employee Directors 2001 Stock Option Plan, and, having read it, I hereby signify my understanding or, and my agreement with its terms and conditions.

Director

Date

3

EX-10.15

Exhibit 10.15

GENERAL BINDING COMPANY

RESTRICTED STOCK UNIT GRANT NOTICE
2004 LTIP AWARD

1.	THIS GRANT NOTICE made this 26th day of February, 2004, the (“Award Date”), by and between General Binding Corporation (“GBC” or the “Company”) and the employee named on Schedule A attached hereto (the “Participant”) is evidence of an Award under the 2001 Stock Incentive Plan for Employees, as amended and restated (formerly the 2001 Stock Option Plan for Employees) (the “Stock Plan”) which is incorporated into this Grant Notice by reference. A copy of the Plan has been provided to the Participant. Unless defined herein, capitalized terms have the meaning ascribed to them in the Stock Plan.
2.	Restricted Share Unit Award. The Company hereby awards to the Participant as of the Award Date the number of restricted stock units indicated on Schedule A (the “RSUs”). Subject to the achievement of certain business performance criteria as described in Schedule A to this Grant Notice and further subject to the continued employment of the Participant with the Company until February 26, 2007 (the “Vesting Date”), the RSUs will be distributed in accordance with the terms and conditions stated in Schedule A. While the restrictions are in effect, the RSUs are not transferable by the Participant by means of sale, assignment, exchange, pledge, or otherwise, except as provided herein.
3.	Restricted Stock Units. At such time as the RSUs vest (i.e., the restrictions lapse), if ever, the RSUs will be converted into shares of Stock (the “Shares”) on a one-for-one basis. RSUs awarded will be appropriately adjusted, if necessary, as provided for in Section 5.4 of the Stock Plan. Until the RSUs vest and the shares are issued to Participant, the Participant will not be entitled to any rights of a shareholder with respect to the RSUs.
4.	Dividend Equivalents. Subject to the restrictions, limitations, terms and conditions as described in the Stock Plan and this Grant Notice, Dividend Equivalents with respect to the RSUs will be accrued on behalf of the Participant at the time that dividends are otherwise paid to owners of Stock.
5.	Distribution of the Award. Subject to Section 6 of this Grant Notice and unless otherwise deferred pursuant to Section 7 of this Grant Notice, as soon as practicable following the Vesting Date, the RSUs will be converted into Shares and distributed to the Participant. Dividend Equivalents accrued thereon will be paid to the Participant in cash.
6.	Taxes. Under current U.S. tax law, a Participant receives no taxable income when RSUs are awarded or Dividend Equivalents are accrued. The Vesting Date is the date when a taxable event occurs, except to the extent the participant has elected to defer distribution of the Shares until a later date (“Deferred Delivery Date”). The market value of the Stock on the Vesting Date or the Deferred Delivery Date, as the case may be, and the amount of the Dividend Equivalents paid will determine the amount of taxable income. This amount is then subject to applicable federal, state and local tax-withholding

requirements. Amounts necessary to settle the statutory minimum tax-withholding requirements will be withheld first from the amount of Dividend Equivalents then being paid and then by withholding otherwise distributable Shares having a Fair Market Value equal to any remaining minimum tax-withholding requirements. Such withholding of Shares shall not be required to the extent the Participant pays the amount of such tax-withholding to the Company in cash.

7.	Election to Defer Distribution. The Participant may elect to defer the distribution of some or all of the RSUs. Dividend Equivalents are not eligible for deferral. Such deferral election must be received in writing by the Company no later than December 15 prior to the Vesting Date, unless the Executive Compensation and Development Committee or another Committee designated to so act by the Board of Directors (the “Committee”) shall provide otherwise. The deferral election and the period of deferral shall be subject to such additional rules and procedures as the committee may from time to time prescribe.
8.	Retirement, Death or Total Disability. If the Participant’s Retirement, death or Disability occurs (the “Event”) before the Vesting Date, the restrictions will lapse with respect to (i) a pro-rata number of the Target RSUs relating to Performance Period(s) not completed prior to the date, using the number of months from the Award Date to the Vesting Date as the denominator and the number of whole and partial months of active service from the Award Date to the date of the Event, as the numerator of the proration fraction and, (ii) any RSUs that have been Earned in the manner described in Schedule A prior to the Event. The RSUs with respect to which the restrictions lapse and related Dividend Equivalents and interest will be released as soon as practicable, subject to Section 6 of this Grant Notice.
9.	Other Post-Employment Provisions. In the event of any termination of the Participant’s employment other than due to an Event or in connection with a Change in Control before the RSUs have vested, the RSUs and Dividend Equivalents of the Participant will be forfeited by such Participant, unless, based upon the circumstances surrounding such termination, the Committee, in its sole discretion, determines that such unvested RSUs and Dividend Equivalents shall be proportionately vested based upon the formula set forth in Section 8 above. In no event, however, shall any portion of unvested RSUs or Dividend Equivalents become vested if the termination of employment is a termination by the Company for Cause.
10.	Disposition of Business. In the event of the sale, closing or spin-off of a division, business unit or other segment of the Company, or any business transaction similar in nature thereto, all RSUs and Dividend Equivalents of Participants employed by that entity that have been Earned and any remaining Target RSU’s will vest and/or be forfeited in accordance with Section 11 below as if such event was a Change in Control with respect to the affected Participants.
11.	Change in Control. In the event that a Change in Control (as defined in Article 11 of the Stock Plan) occurs, the restrictions will lapse as of the date of the Change in Control (“Change in Control Date”) with respect to (a) all Dividend Equivalents, (b) any RSUs that have been Earned in the manner described in Schedule A, and (c) a number of RSUs

2

	equal to the number of Target RSUs relating to the Performance Period during which the Change in Control Date occurs multiplied by a fraction, the numerator of which is the greater of six (6) or the number of whole and partial months in such Performance Period which have elapsed as of the Change in Control Date and the denominator of which is 12. Any RSUs which remain unvested after application of this Section 11 will be forfeited by the Participant as of the Change in Control Date, unless otherwise determined by the Committee.
12.	Conformity with the Plan. This Award is intended to conform in all respects with, and is subject to, all applicable provisions of the Stock Plan. Inconsistencies between this Grant Notice and the Stock Plan shall be resolved in accordance with the terms of the Stock Plan. By acceptance of this Grant Notice, Participant agrees to be bound by all of the terms of this Grant Notice and the Stock Plan.
13.	Interpretation. Any dispute, disagreement or question which arises under, or as a result, of, or in any way relates to the interpretation, construction or applicability of the Sock Plan will be determined and resolved by the Committee.
14.	Employment Rights. Nothing in the Stock Plan or this Grant Notice will confer on the Participant any right to continue in the employ of the Company or in any way affect the Company’s right to terminate the Participant’s employment without prior notice at any time and for any reason.

GENERAL BINDING CORPORATION
By:
	Dennis J. Martin
	Chairman, President and Chief Executive Officer

TO:	Vice President, Human Resources
	General Binding Corporation

I hereby agree to the terms and conditions of this Restricted Stock Unit Grant Notice. I also hereby acknowledge receipt of a copy of the General Binding Corporation 2001 Stock Incentive Plan for Employees, as amended and restated (formerly the General Binding Corporation 2001 Stock Option Plan for Employees) and, having read it, I hereby signify my understanding of, and my agreement with, its terms and conditions as of the date of this Award.

Participant

3

GENERAL BINDING COMPANY

RESTRICTED STOCK UNIT GRANT
2003 LTIP AWARD

SCHEDULE A

Employee Name      -

Three Year Target Award      -

Maximum Three Year Award      -

Minimum Three Year Award      -

Performance Period      -

Year 1 -	January 1, 2004 — December 31, 2004
Year 2 -	January 1, 2005 — December 31, 2005
Year 3 -	January 1, 2006 — December 31, 2006

Performance Measures      -

Year 1 -	Attached as Schedule A-1
Year 2 -	To be determined by the Committee
Year 3 -	To be determined by the Committee

Earning Criteria

     One third of the Target Three Year Award will be subject to the Performance Measures for that annual Performance Period (the “Target RSUs” for such Performance Period). To the extent the Company meets the Performance Measures for that year, the award attributable to that year will be deemed “Earned”. For example, if you are given a Target Three Year Award of 3,000 RSUs, 1,000 of those would be the Target RSUs subject to Performance Measures in each year of the Performance Period. If the company achieves 100% of each Performance Measure in the applicable year, you would earn 100% of the Target RSUs for that year, or 1,000 RSUs. If the Company achieved 100% of two of the Performance measures and less than 50% of the third Measure, you would earn 66 2/3% of the Target RSUs for that year, or 667 RSUs. If the Company achieved 150% or more of two of the Performance Measures and 100% of the third Performance Measure, you would earn 133 1/3% of the Target RSUs, or 1,333 RSUs (see the attached matrix for additional information). Achievement levels between 50% — 150% will be ratably adjusted. Any Target RSUs not Earned as of the end of the applicable Performance Period will be forfeited and may not become “Earned” or vested thereafter.

     All RSUs that are Earned will vest on the Vesting Date subject to and in accordance with the Stock Plan and your Grant Notice. The determination of the level of performance achievement shall be made by the Committee.

SCHEDULE A-1

2004
Restricted Stock Units (RSU)
Financial Performance Measures

Percent	Corporate SVA			Corporate			New Product
Target	Results			Net Sales			Sales
Achievement	(000’s)			Increase			(000’s)
150%
100%
50%
Weighting		33 1/3	%		33 1/3	%		33 1/3	%

EX-18.1

Exhibit 18.1

August 29, 2005

BOARD OF DIRECTORS
ACCO Brands Corporation
300 Tower Parkway
Lincolnshire, IL 60069

Dear Directors:

We are providing this letter to you for inclusion as an exhibit to your Form 10-Q filing pursuant to Item 601 of Regulation S-K.

We have been provided a copy of the Company’s Quarterly Report on Form 10-Q for the period ended June 25, 2005. Note 1 therein describes a change in accounting principle related to the elimination of a one month lag in reporting by two of the Company’s foreign subsidiaries to align their reporting period with the Company’s fiscal calendar. It should be understood that the preferability of one acceptable method of accounting over another for the determination of an appropriate alignment of a foreign subsidiary’s reporting period for purposes of consolidation has not been addressed in any authoritative accounting literature, and in expressing our concurrence below we have relied on management’s determination that this change in accounting principle is preferable. Based on our reading of management’s stated reasons and justification for this change in accounting principle in the Form 10-Q, and our discussions with management as to their judgment about the relevant business planning factors relating to the change, we concur with management that such change represents, in the Company’s circumstances, the adoption of a preferable accounting principle in conformity with Accounting Principles Board Opinion No. 20.

We have not audited any financial statements of the Company as of any date or for any period subsequent to December 27, 2004. Accordingly, our comments are subject to change upon completion of an audit of the financial statements covering the period of the accounting change.

Very truly yours,

PricewaterhouseCoopers LLP

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, David D. Campbell, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of ACCO Brands Corporation;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 29, 2005

/s/	David D. Campbell
	David D. Campbell
	Chairman of the Board and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Neal V. Fenwick, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of ACCO Brands Corporation;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b ) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 29, 2005

/s/ Neal V. Fenwick

Neal V. Fenwick

Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

As adopted pursuant to

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Quarterly Report of ACCO Brands Corporation on Form 10-Q for the period ended June 25, 2005 as filed with the Securities and Exchange Commission on August 26, 2005, (the “Report”), I, David D. Campbell, Chief Executive Officer of ACCO Brands Corporation, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of ACCO Brands Corporation.

By:	/s/	David D. Campbell
		David D. Campbell
		Chairman of the Board and Chief
		Executive Officer
		August 29, 2005

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

As adopted pursuant to

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Quarterly Report of ACCO Brands Corporation on Form 10-Q for the period ended June 25, 2005 as filed with the Securities and Exchange Commission on August 26, 2005, (the “Report”), I, Neal V. Fenwick, Chief Financial Officer of ACCO Brands Corporation, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of ACCO Brands Corporation.

By:	/s/	Neal V. Fenwick
		Neal V. Fenwick
		Executive Vice President and Chief
		Financial Officer
		August 29, 2005