**Exhibit 10.3**

**EXECUTION COPY**

DATED as of the 28th day of December, 2006.

- among -

**CASCADES INC.**

as Purchaser

- and –

**DOMTAR INC.**

as Vendor

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SHARE PURCHASE AGREEMENT

 

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**TABLE OF CONTENTS**
| **ARTICLE 1.  INTERPRETATION**                 | ** ** | **1**                                                                    |
|------------------------------------------------|------------|--------------------------------------------------------------------------|
| ** **                                     | ** ** |                                                                     |
| 1.1                                            |       | Definitions                                                              |   | 1 |
| 1.2                                            |       | Recitals                                                                 |   | 4 |
| 1.3                                            |       | Governing Law; Attornment                                                |   | 4 |
| 1.4                                            |       | Entire Agreement; Amendment                                              |   | 4 |
| 1.5                                            |       | Calculation of Time                                                      |   | 4 |
| 1.6                                            |       | Performance on Holidays                                                  |   | 4 |
| 1.7                                            |       | Waiver of Rights                                                         |   | 4 |
| 1.8                                            |       | Severability                                                             |   | 5 |
| 1.9                                            |       | Additional Rules of Interpretation                                       |   | 5 |
| 1.10                                           |       | Schedules                                                                |   | 5 |
|                                           |       |                                                                     |   |   |
| **ARTICLE 2.  PURCHASE AND SALE**              |       | **5**                                                                    |
| ** **                                     | ** ** |                                                                     |
| 2.1                                            |       | Purchase and Sale                                                        |   | 5 |
| 2.2                                            |       | Amount and Payment of Purchase Price                                     |   | 5 |
| 2.3                                            |       | Delivery of Share Certificates                                           |   | 5 |
| 2.4                                            |       | Place of Closing                                                         |   | 6 |
|                                           |       |                                                                     |   |   |
| **ARTICLE 3.  REPRESENTATIONS AND WARRANTIES** | ** ** | **6**                                                                    |
| ** **                                     | ** ** |                                                                     |
| 3.1                                            |       | Representations and  Warranties of the Vendor                            |   | 6 |
|                                           |       | 3.1.1    Status  and Capacity of the Vendor          |   | 6 |
|                                           |       | 3.1.2    Authorization of  Purchase by the Vendor    |   | 6 |
|                                           |       | 3.1.3    Title to Shares                             |   | 6 |
| 3.2                                            |       | Representations and Warranties of the Purchaser                          |   | 7 |
|                                           |       | 3.2.1    Status and Capacity of  the Purchaser       |   | 7 |
|                                           |       | 3.2.2    Authorization of  Purchase by the Purchaser |   | 7 |
| 3.3                                            |       | Commission                                                               |   | 7 |
|                                           |       |                                                                     |   |   |
| **ARTICLE 4.  COVENANTS OF THE PARTIES**       | ** ** | **7**                                                                    |
| ** **                                     | ** ** | ** **                                                               |
| 4.1                                            |       | Covenant of the Purchaser                                                |   | 7 |
|                                           |       | 4.1.1    Prohibition to Sell                         |   | 7 |
| 4.2                                            |       | Mutual Covenants                                                         |   | 7 |
|                                           |       | 4.2.1    Cooperation                                 |   | 8 |
|                                           |       |                                                                     |   |   |
| **ARTICLE 5.  CONDITIONS OF CLOSING**          |       | **8**                                                                    |
| ** **                                     |       |                                                                     |
| 5.1                                            |       | Conditions for the Benefit of the Purchaser                              |   | 8 |

 

 

 

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|                         |       | 5.1.1    Representations,  Warranties and Covenants of the Vendor    |   | 8      |
|------------------------------|------------|------------------------------------------------------------------------------------------|--------|--------|
| 5.2                          |       | Conditions for  the Benefit of the Vendor                                                |   | 8      |
|                         |       | 5.2.1    Representations,  Warranties and Covenants of the Purchaser |   | 8      |
| 5.3                          |       | Conditions for  the Benefit of both Parties                                              |   | 9      |
|                         |       | 5.3.1    Competition  Act Approval                                   |   | 9      |
|                         |       | 5.3.2    Cost  Sharing Agreement                                     |   | 9      |
|                         |       | 5.3.3    Closing  Documents                                          |   | 9      |
| 5.4                          |       | Waiver                                                                                   |   | 9      |
| 5.5                          |       | Failure to  Satisfy Conditions                                                           |   | 9      |
|                         |       |                                                                                     |   |   |
| **ARTICLE 6. MISCELLANEOUS** | ** ** | **10**                                                                                   |
| ** **                   | ** ** | ** **                                                                               |
| 6.1                          |       | Further  Assurances                                                                      |   | 10     |
| 6.2                          |       | Public  Announcements                                                                    |   | 10     |
| 6.3                          |       | Notices                                                                                  |   | 10     |
| 6.4                          |       | Costs and  Expenses                                                                      |   | 12     |
| 6.5                          |       | Counterparts                                                                             |   | 12     |
| 6.6                          |       | Assignment                                                                               |   | 12     |
| 6.7                          |       | Shareholders’  Agreement                                                            |   | 12     |
| 6.8                          |       | Parties in  Interest                                                                     |   | 12     |
| 6.9                          |       | Language                                                                                 |   | 12     |

 

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**THISSHARE PURCHASE AGREEMENT** is dated as of the 28th day of December, 2006.
| **BETWEEN:** | ** ** | **CASCADES  INC.**, a company duly incorporated and existing under the  laws of the Province of Quebec, having its head office at 404 Marie-Victorin  Street, in the Town of Kingsey Falls, Province of Quebec, J0A 1B0; |
|--------------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** **   | ** ** | ** **                                                                                                                                                                                                                    |
| ** **   | ** ** | (the “**Purchaser**”)                                                                                                                                                                                               |
| ** **   | ** ** | ** **                                                                                                                                                                                                                    |
| **AND:**     | ** ** | **DOMTAR  INC.,**a company duly incorporated and existing under the  laws of Canada, having its head office at 395 de Maisonneuve West, in the  City of Montreal, Province of Quebec, H3A 1L6;                           |

 

(the “**Vendor**”)

**RECITALS:**

1.                                      The Vendor owns 10,000,100 Class B Commonshares in the capital of Norampac Inc. (the “**Corporation**”);

2.                                      TheVendor has agreed to sell and the Purchaser has agreed to purchase all of theissued and oustanding shares in the capital of the Corporation held by the Vendor, on the Closing Date, upon andsubject to the terms and conditions contained in this Agreement;

3.                                      TheCorporation carries on the business of the manufacture, distribution and saleof corrugating medium and linear board and corrugated boxes and relatedactivities (the “**Business**”);

NOW THEREFORE in consideration of the premises and mutual agreementshereinafter set out and of other good and valuable consideration (the receiptand sufficiency of which are acknowledged by each Party), the Parties agree asfollows:

# **Article1.**

# **INTERPRETATION**

## 1.1                                                                          **Definitions**

In this Agreement:

“**Affiliate**”means, with respect to any person, any other person that directly or indirectlycontrols, is controlled by, or is under common control with that otherperson.  For purposes of this definition,a person “controls” another person if that person directly or indirectlypossesses the power to direct or cause the direction of the management andpolicies of that other person, whether through ownership or voting ofsecurities, by contract or otherwise and “controlled by” and “under commoncontrol with” have similar meanings;

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**“Agreement”** means this sharepurchase agreement and all Schedules and Exhibits attached hereto;

**“Applicable Law”** means, in respectof any person, property, transaction or event, any domestic or foreign statute,ordinance, rule, regulation, treaty, restriction, regulatory policy, standard,code, by-law (zoning or otherwise) or Order that applies in whole or in part tosuch person, property, transaction or event and that has force of law wheresuch person or property is located or the transaction or event occurs;

**“Business”** has the meaning ascribedto that term in the third recital;

**“Business Day”** means a day otherthan a Saturday, Sunday or any other day on which the principal chartered bankslocated in the City of Montreal, Quebec are not open for the transaction ofdomestic business during normal banking hours;

**“Closing”** means the completion ofthe sale by the Vendor to and purchase by the Purchaser of, the PurchasedShares and the completion of all other transactions contemplated by thisAgreement that are to occur contemporaneously therewith;

**“Closing Date”** means December 29, 2006 or such earlier orlater date as may be agreed upon in writing by the Parties but, in any event,not later than on the Outside Date;

**“Closing Document”** means anydocument or instrument delivered at or subsequent to the Closing as provided inor pursuant to this Agreement;

**“Closing Time”** means 5:00 o’clock p.m. Montreal time on theClosing Date or such other time on the Closing Date as the Parties agree in writing****thatthe Closing shall take place;

**“Commissioner”** means theCommissioner of Competition appointed under the *CompetitionAct* (Canada);

**“Competition Act Approval”** meanseither:

#### (a)                                  the applicablewaiting period under section 123 of the *CompetitionAct* (Canada) shall have expired and the Purchaser shall have beenadvised in writing by the Commissioner in terms satisfactory to the Purchaserin its sole discretion that she has determined not to make an application foran Order under the *Competition Act*(Canada), in respect of the transactions contemplated by this Agreement;

#### (b)                                 the Commissioner shallhave issued a waiver under Subsection 113(c) of the *CompetitionAct* (Canada) and the Purchaser shall have been advised in writing bythe Commissioner in terms satisfactory to the Purchaser in its sole discretion,that she has determined not to make an application for an Order under the *Competition Act* (Canada) in respect of the transactionscontemplated by this Agreement; or

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#### (c)                                  an advance rulingcertificate shall have been issued under section 102 of such Act in respect ofthe transactions contemplated by this Agreement;

**“Corporation”**has the meaning ascribed to that term in the first recital;

**“DisclosureSchedule”** means Schedule 1.1A;

**“Encumbrance”**means any mortgage, charge, hypothec, prior claim, encroachment, lien,encumbrance, adverse claim, restrictive covenant, assignment by way ofsecurity, security interest of any nature, pledge or privilege or any agreementto create any of the foregoing;

**“GovernmentalAuthority”** means any domestic or foreign government, whetherfederal, provincial, state, territorial or municipal; and any governmentalagency, ministry, department, Tribunal, commission, bureau, board or otherinstrumentality exercising or purporting to exercise legislative, judicial,regulatory or administrative functions of, or pertaining to, government, ineach case having jurisdiction over the Vendor or the Corporation;

**“LegalProceeding”** means any litigation, action, suit,investigation, hearing, claim, complaint, grievance, arbitration proceeding orother proceeding and includes any appeal or review and any application forsame;

**“Licence”**means any licence, permit, approval, authorization, certificate, directive,order, variance, registration, right, privilege, concession or franchiseissued, granted, conferred or otherwise created by any Governmental Authority;

**“Order”**means any order, directive, judgment, decree, award or writ of any Tribunal;

**“OutsideDate”** means February 28, 2007;

**“Parties”**means the Vendor and the Purchaser and **“Party”**means either one of them;

**“PurchasedShares”** has the meaning ascribed to that term in Section 2.1;

**“PurchasePrice”** means the price payable by the Purchaser to the Vendorfor the Purchased Shares provided for in Section 2.2;

**“RegulatoryApproval”** means any approval, consent, ruling, authorization,notice, permit or acknowledgement that may be required from any person byApplicable Law, the terms of any Licence or the conditions of any Order orotherwise which is required in connection with the sale of the Purchased Sharesto the Purchaser and the completion of the other transactions contemplatedherein or which is otherwise necessary to permit the Parties to perform theirobligations or is otherwise required to permit the consummation of thetransactions as contemplated herein,including, without limitation, Competition Act Approval; and

**“Representative”**means, in respect of a Party, each director, officer, employee, agent, legalcounsel, accountant, professional advisor and other representative of thatParty;

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**“Tribunal”** means any court(including a court of equity), arbitrator or arbitration panel and any otherGovernmental Authority, stock exchange, or association or other body exercisingadjudicative, regulatory, judicial or quasi-judicial powers.

## **1.2****                                                                       ****Recitals**

The recitals in this Agreement shall form an integral part hereof.

## **1.3****                                                                        GoverningLaw; Attornment**

This Agreement shall be construed, interpreted and enforced inaccordance with, and the rights of the Parties shall be governed by, the lawsof the Province of Quebec and the federal laws of Canada applicable therein(excluding any conflict of law rule or principle of such laws that might refersuch interpretation or enforcement to the laws of another jurisdiction).  Each Party irrevocably submits to theexclusive jurisdiction of the courts of the Province of Quebec (district ofMontréal) with respect to any matter arising hereunder or relating hereto.

## **1.4****                                                                        EntireAgreement; Amendment**

This Agreement constitutes the entire agreement between the Partieswith respect to the transactions herein contemplated and cancels and supersedesany prior understandings, agreements, negotiations and discussions, written ororal, between the Parties with respect thereto. There are no representations, warranties, terms, conditions,undertakings or collateral agreements or understandings, express or implied,between the Parties other than those expressly set forth in this Agreement orin any Closing Document.  This Agreementshall not be amended, supplemented or otherwise modified in any respect exceptby written instrument executed by each of the Parties.

## **1.5****                                                                        Calculationof Time**

In this Agreement, a period of days shall be deemed to begin on thefirst day after the event which began the period and to end at 5:00 p.m.(Montreal****time) on the last day ofthe period.  If any period of time is toexpire hereunder on any day that is not a Business Day, the period shall bedeemed to expire at 5:00 p.m. (Montreal****time)on the next succeeding Business Day.

## **1.6****                                                                        Performanceon Holidays**

If any act (including the giving of notice) is otherwise required bythe terms hereof to be performed on a day which is not a Business Day, such actshall be valid if performed on the next succeeding Business Day.

## **1.7****                                                                        Waiverof Rights**

Any waiver of, or consent to depart from, the requirements of anyprovision of this Agreement shall be effective only if it is in writing andsigned by the Party giving it, and only in the specific instance and for thespecific purpose for which it has been given. No failure on the part of any Party to exercise, and no delay inexercising, any right under this Agreement

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shall operate as a waiver of such right.  No single or partial exercise of any suchright shall preclude any other or further exercise of such right or theexercise of any other right.

## **1.8****                                                                        Severability**

Any provision in this Agreement which is prohibited or unenforceable inany jurisdiction shall, as to such jurisdiction, be ineffective to the extentof such prohibition or unenforceability without invalidating the remainingprovisions hereof or affecting the validity or enforceability of such provisionin any other jurisdiction.

## **1.9****                                                                       ****Additional Rules of Interpretation**

#### (a)                                  wherever the words“include”, “includes” or “including” are used in this Agreement or in anyClosing Document, they shall be deemed to be followed by the words “withoutlimitation”;

#### (b)                                 all references hereinto any agreement (including this Agreement), document or instrument mean suchagreement, document or instrument as amended, supplemented, modified, varied,restated or replaced from time to time in accordance with the terms thereofand, unless otherwise specified therein, includes all schedules and exhibitsattached thereto.

## **1.10****                                                                       ****Schedules**

The following is the Schedule attached to and incorporated in thisAgreement by reference and deemed to be a part hereof:

Schedule 1.1A                               DisclosureSchedule

Section 5.3.2 - Form ofCost Sharing Agreement

# **Article2.PURCHASE AND SALE**

## **2.1****                                                                        Purchaseand Sale**

Subject to the terms, conditions and covenants contained herein, theVendor hereby agrees to sell, assign and transfer to the Purchaser and thePurchaser hereby agrees to purchase from the Vendor, on the Closing Date, allof the shares held by the Vendor in the capital of the Corporation (the “**Purchased Shares**”), being 10,000,100 ClassB Common shares.

## **2.2****                                                                        Amountand Payment of Purchase Price**

The aggregate price payable by the Purchaser to the Vendor for thePurchased Shares (the “**Purchase Price**”)is the sum of CDN$560,000,000, subject to adjustment, as the case may be,pursuant to Section 4.1 of the Cost Sharing Agreement dated the datehereof between the Purchaser and the Vendor, payable to the Vendor at theClosing Time by wire transfer of immediately available funds to an accountspecified by the Vendor.

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## **2.3****                                                                        Deliveryof Share Certificates**

The Vendor shall transfer and deliver to the Purchaser at the ClosingTime share certificates representing the Purchased Shares duly endorsed inblank for transfer, or accompanied by irrevocable security transfer powers ofattorney duly executed in blank.

## **2.4****                                                                        Placeof Closing**

The Closing shall take place at the Closing Time at the offices ofFraser Milner Casgrain LLP, 1 Place Ville-Marie, Suite 3900, Montreal,Quebec.

# **Article3.REPRESENTATIONS AND WARRANTIES**

## **3.1****                                                                        Representationsand Warranties of the Vendor**

Subject to any limitations contained in this Agreement, the Vendorhereby represents and warrants to the Purchaser that the representations andwarranties set forth below are true and correct as at the date hereof, unlessexpressly specified otherwise.

### **3.1.1****                                                                    Statusand Capacity of the Vendor**

The Vendor is a corporation duly incorporated, organized and subsistingunder the laws of Canada and has the corporate power, authority and capacity toexecute and deliver this Agreement, to sell and transfer the Purchased Sharesowned by it to the Purchaser as herein contemplated and to perform its otherobligations hereunder.  No proceedingshave been taken or authorized by the Vendor or by any other person with respectto the bankruptcy, insolvency, liquidation, dissolution or winding up of theVendor nor, to the knowledge of the Vendor, have any such proceedings beenthreatened by any other person.

### **3.1.2****                                                                    Authorizationof Purchase by the Vendor**

The execution and delivery of this Agreement and the completion of thetransactions herein contemplated have been duly and validly authorized by allnecessary corporate action on behalf of the Vendor and this Agreement has beenduly and validly executed and delivered by the Vendor and is a valid andbinding obligation of the Vendor enforceable against it in accordance with itsterms.  There is no Legal Proceeding inprogress, pending or, to the knowledge of the Vendor, threatened, against oraffecting the Vendor or affecting the title of the Vendor to the PurchasedShares or which affects or might reasonably be expected to affect the abilityof the Vendor to enter into this Agreement or to perform its obligationshereunder.

### **3.1.3****                                                                    Titleto Shares**

The Vendor legally and beneficially owns thePurchased Shares free of any Encumbrances.  No person has, or has any right capable ofbecoming, any agreement, option, understanding or commitment for the purchaseor other acquisition from the Vendor of any of the Purchased Shares.  Except for the Purchased Shares, the Vendordoes not own or hold any shares in the capital of the Corporation or anyoptions, calls, warrants or other securities or rights which are convertibleinto, exercisable for or relate to any shares or securities convertible intoshares in the capital of the Corporation.

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## **3.2****                                                                        Representationsand Warranties of the Purchaser**

The Purchaser represents and warrants to the Vendor as set out in thisSection 3.2 and acknowledges that the Vendor is relying on such representationsand warranties in connection with the transactions contemplated in thisAgreement.

### **3.2.1****                                                                    Statusand Capacity of the Purchaser**

The Purchaser is a company duly incorporated, organized and subsistingunder the laws of the Province of Quebec and has the corporate power, authorityand capacity to enter into this Agreement and is duly qualified to own or leaseits property and to carry on its business as presently conducted.  No proceedings have been taken or authorizedby the Purchaser or by any other person with respect to the bankruptcy,insolvency, liquidation, dissolution or winding up of the Purchaser or withrespect to any consolidation, arrangement or reorganization of, or relating to,the Purchaser nor, to the knowledge of the Purchaser, have any such proceedingsbeen threatened by any other person.

### **3.2.2****                                                                    Authorizationof Purchase by the Purchaser**

The execution and delivery of this Agreement and the completion of thetransactions herein contemplated have been duly and validly authorized by allnecessary action on behalf of the Purchaser and this Agreement has been dulyand validly executed and delivered by the Purchaser and is a valid and bindingobligation of the Purchaser enforceable against it in accordance with itsterms.

## **3.3****                                                                        Commission**

Each Party represents and warrants to the other Party that such otherParty will not be liable for any brokerage commission, finder’s fee or othersimilar payment in connection with the transactions contemplated hereby.

# **Article4.COVENANTS OF THE PARTIES**

## **4.1****                                                                        Covenantof the Purchaser**

### **4.1.1****                                                                    Prohibitionto Sell**

The Purchaser hereby agrees that it shall not, directly or indirectly,sell, transfer or assign, in any way, in whole or in part, the Business for aperiod of three years following the Closing Date.  Notwithstanding the foregoing, the Purchasermay transfer the Business or any portion thereof to one or more of itsAffiliates at any time.

## **4.2****                                                                        MutualCovenants**

Each Party hereby covenants and agrees with the other Party as follows:

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### **4.2.1****                                                                    Cooperation**

The Parties shall cooperate fully in good faith with each other andtheir respective Representatives in connection with any steps required to betaken as part of their respective obligations under this Agreement.

# **Article5.CONDITIONS OF CLOSING**

## **5.1****                                                                        Conditionsfor the Benefit of the Purchaser**

The transactions herein contemplated, including thesale and purchase of the Purchased Shares in accordance with the terms of thisAgreement, are subject to the conditions precedent set out in this Section 5.1,each of which is hereby declared to be for the exclusive benefit of thePurchaser.  Each of such conditions is tobe satisfied in full at or prior to the Closing and, in any event, not laterthan on the Outside Date.  The Vendorcovenants and agrees to use its best efforts to cause each of such conditionsto be fulfilled at or prior to the Closing Time.

### **5.1.1****                                                                    Representations,Warranties and Covenants of the Vendor**

#### (a)                                  All representationsand warranties of the Vendor made in or pursuant to this Agreement are true andcorrect and shall be true and correct at the Closing Time as if suchrepresentations and warranties had been made at and as of the Closing Time.

#### (b)                                 The Vendor shall haveperformed or complied with all obligations, covenants and agreements containedin this Agreement to be performed by it at or prior to the Closing Time.

## **5.2****                                                                        Conditionsfor the Benefit of the Vendor**

The transactions herein contemplated, including thesale and purchase of the Purchased Shares in accordance with the terms of thisAgreement, are subject to the conditions precedent set out in this Section 5.2,each of which is hereby declared to be for the exclusive benefit of theVendor.  Each of such conditions is to besatisfied in full at or prior to the Closing and, in any event, not later thanon the Outside Date.  The Purchasercovenants and agrees to use its best efforts to cause each of such conditionsto be fulfilled prior to the Closing Time.

 

### **5.2.1****                                                                    Representations,Warranties and Covenants of the Purchaser**

#### (a)                                  The representationsand warranties of the Purchaser made in or pursuant to this Agreement are trueand correct and shall be true and correct at the Closing Time as if suchrepresentations and warranties had been made at and as of the Closing Time.

#### (b)                                 The Purchaser shallhave performed or complied with all obligations, covenants and agreementscontained in this Agreement to be performed by it at or prior to the ClosingTime.

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## **5.3****                                                                        Conditionsfor the Benefit of both Parties**

The transactions herein contemplated, including thesale and purchase of the Purchased Shares in accordance with the terms of thisAgreement, are subject to the conditions precedent set out in this Section 5.3,each of which is hereby declared to be for the benefit of both of the Partieshereto.  Each of such conditions is to besatisfied in full at or prior to the Closing and, in any event, not later thanon the Outside Date.  Each of the Partiescovenants and agrees to use its best efforts to cause each of such conditions tobe fulfilled prior to the Closing Time.

 

### **5.3.1****                                                                    CompetitionAct Approval**

The Competition Act Approval shall have been granted, obtained andreceived.

### **5.3.2****                                                                    CostSharing Agreement**

The Parties shall haveentered into a cost sharing agreement in respect of the environmental costs andliabilities which may arise in the event that the Corporation decides topermanently shutdown the containerboard mill located in Red Rock, Ontario,substantially in the form attached hereto as Section 5.3.2 of the DisclosureSchedule.

 

### **5.3.3****                                                                    ClosingDocuments**

The Parties shall havereceived such other agreements, certificates, affidavits, statutorydeclarations, instruments of transfer and other documentation reasonablyrequired by each to implement the transactions herein contemplated, all ofwhich shall be satisfactory in form and substance to its respective counsel,acting reasonably.

## **5.4****                                                                        Waiver**

Either Party may waive,by notice to the other Party, any condition set forth in this Article 5 whichis for its benefit.  No waiver by a Partyof any condition, in whole or in part, shall operate as a waiver of any othercondition.

 

## **5.5****                                                                        Failureto Satisfy Conditions**

If any condition setforth in Sections 5.1, 5.2 or 5.3 is not satisfied or waived by the OutsideDate, or if it becomes apparent that any such condition cannot be satisfied atthe Closing Time, the Party entitled to the benefit of such condition (the “**First Party**”) may terminate this Agreement,acting reasonably, by notice in writing to the other Party and in such event:

 

#### (a)                                  unless the otherParty can show that the condition or conditions which have not been satisfiedand for which the First Party has terminated this Agreement are reasonablycapable of being performed or caused to be performed by the First Party or havenot been satisfied by reason of a default by the First Party hereunder, theFirst Party shall be released from all obligations hereunder; and

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#### (b)                                 unless the First Partycan show that the condition or conditions which have not been satisfied and forwhich the First Party has terminated this Agreement are reasonably capable ofbeing performed or caused to be performed by the other Party or have not beensatisfied by reason of a default by the other Party hereunder, then the otherParty shall also be released from all obligations hereunder;

provided however that no release of obligations under this Section 5.5shall release either Party from any obligation under Section 6.2 or Section6.4.

 

# **Article6.MISCELLANEOUS**

## **6.1****                                                                        FurtherAssurances**

Each Party shall from time to time execute and deliver or cause to beexecuted and delivered all such further documents and instruments and do orcause to be done all further acts and things as the other Party may, before orafter the Closing Time, reasonably require as being necessary or desirable inorder to effectively carry out or better evidence or perfect the full intentand meaning of this Agreement or any provision hereof.

## **6.2****                                                                        PublicAnnouncements**

Except to the extent required by Applicable Law, each Party agrees thatno disclosure or public announcement regarding this Agreement or thetransactions contemplated hereby shall be made by either Party without theprior written consent of the other Party.

## **6.3****                                                                        Notices**

#### (a)                                  Any notice, directionor other communication (in this Section, a “notice”) required or permitted tobe given to a Party shall be in writing and shall be sufficiently given ifdelivered personally, mailed or transmitted by facsimile as follows:

##### (i)                                     in the case of thePurchaser, at:

Cascades Inc.

404 Marie-VictorinStreet

Kingsey Falls, QC J0A 1B0

Attention: President

Fax No.:  (819) 363-5155

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with a copy to (which shall not constitute notice):

Fraser Milner Casgrain LLP

1 Place Ville-Marie

Suite 3900

Montreal, QC  H3B 4M7

Attention:                             Charles R. Spector

Fax No.:  (514)866-2241

##### (ii)                                  in the case of theVendor, at:

Domtar Inc.

395 de MaisonneuveWest

Montreal, QC H3A 1L6

Attention: Secretary

Fax No.:  (514) 848-6850

with a copy to (which shall not constitute notice):

Ogilvy Renault LLP

Suite 1100

1981 McGill CollegeAvenue

Montreal, QC H3A 3C1

Attention:                                         Norman M. Steinberg

Fax No.:  (514) 286-5474

#### (b)                                 Any notice deliveredpersonally, shall be deemed to have been given and received on the day on whichit was delivered, if delivered prior to 5:00 p.m. (recipient’s time) on aBusiness Day; otherwise on the first Business Day thereafter.  Any notice mailed shall be deemed to havebeen given and received on the third Business Day after it was mailed, providedthat if the Party giving the notice knows or ought reasonably to know ofdisruptions in the postal system that might affect the delivery of mail, suchnotice shall not be mailed but shall be given by personal delivery or facsimiletransmission.  Any notice transmitted byfacsimile shall be deemed to have been given and received on the day of itstransmission if the machine from which it was sent receives the answerback codeof the Party to whom it was sent prior to 5:00 p.m. (recipient’s time) onsuch day; otherwise on the first Business Day thereafter.

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#### (c)                                  Either Party maychange its address for service from time to time by notice given to each of theother Party in accordance with the foregoing provisions.

## **6.4****                                                                        Costsand Expenses**

Each Party shall be responsible for all costs and expenses (includingthe fees and disbursements of legal counsel, bankers, investment bankers,accountants, brokers and other advisors) incurred by it in connection with thisAgreement and the transactions contemplated herein.  The Parties shall be equally responsible forall filing fees required to be paid in connection with obtaining any RegulatoryApproval for the transactions contemplated herein.

## **6.5****                                                                        Counterparts**

This Agreement may be executed in counterparts, each of which shall bedeemed to be an original and both of which together shall constitute one andthe same instrument.  To evidence itsexecution of an original counterpart of this Agreement, a Party may send a copyof its original signature on the execution page hereof to the other Party byfacsimile transmission and such transmission shall constitute delivery of anexecuted copy of this Agreement to the receiving Party.

## **6.6****                                                                        Assignment**

This Agreement shall not be assigned by either Party without the priorwritten consent of the other Party.

## **6.7****                                                                        Shareholders’Agreement**

The Parties hereby acknowledge that the Shareholders’ Agreement datedDecember 30, 1997 between the Purchaser and the Vendor is terminated.

## **6.8****                                                                        Partiesin Interest**

This Agreement shall enure to the benefit of and be binding upon theParties and their respective successors, including any successor by reason ofthe amalgamation or merger of a Party, and permitted assigns.

## **6.9****                                                                        Language**

The Parties hereby acknowledge that they have requested that thisAgreement and all related documents be drawn up in the English language.  *Les parties aux présentes reconnaissent qu’elles ont exigé que laprésente convention et tout document qui s’y rattachent soient rédigés enanglais*.

*[Balanceof page left intentionally blank]*

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IN WITNESS WHEREOF this Agreement has been executed bythe parties hereto.

 
|        | ** ** | **CASCADES INC.******                               |
|--------|------------|-----------------------------------------------------|
|   | ** ** | ** **                                          |
|   | ** ** | * Signed “Alain Lemaire”*            |
|   |       |  Alain Lemaire, President and Chief Executive  |
|   |       |  Officer                                       |
|   |       |                                                |
|   |       |                                                |
|   | * *   | * Signed “Robert F. Hall”*           |
|   |       |  Robert F. Hall, Vice-President, Legal Affairs |
|   |       |  and Corporate Secretary                       |
|   |       |                                                |
|   |       |                                                |
|   | ** ** | **DOMTAR INC.******                                 |
|   | ** ** | ** **                                          |
|   | ** ** | * Signed “Gilles Pharand”*           |
|   |       |  Per: Gilles Pharand                           |
|   |       |  Title: Senior Vice-President, Corporate       |
|   |       |  Affairs and General Counsel                   |
|   |       |                                                |
|   |       |                                                |
|   | * *   | * Signed “Daniel Buron”*             |
|   | * *   |  Per: Daniel Buron                             |
|   |       |  Title: Senior Vice-President and Chief        |
|   |       |  Financial Officer                             |

 

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