**Exhibit 10.6**

 

**EXECUTION COPY**

 

 

**FOURTH AMENDMENT**

**TO THE CREDIT AGREEMENT**

dated as ofFebruary 13, 2009

 

*Among*

 

**CASCADES INC.CASCADES USA INC.CASCADES EUROPE SAS**(*asBorrowers*)

 

— *and* —

 

**SCOTIA CAPITAL**(*as LeadArranger for the extensionof the Unsecured Revolving Facility*)

 

— *and* —

 

**NATIONAL BANK FINANCIAL**(*as LeadArranger for the amendmentsto the financial covenant*)

 

 

**NATIONAL BANK OF CANADATHE BANK OF NOVA SCOTIA**(*asCo-Administrative Agents*)

 

— *and* —

 

**THE LENDERSFROM TIME TO TIME PARTY HERETO**

 

 

**MCCARTHY TÉTRAULT LLP**

 

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**FOURTH AMENDMENT****TO THE DECEMBER 29, 2006 CASCADES CREDIT AGREEMENT**made as of February 13, 2009.

 
| **BETWEEN:**   | ** ** | **CASCADES INC.** (“Cascades”)                                   |
|----------------|------------|----------------------------------------------------------------------------|
| ** **     | ** ** | ** **                                                                 |
| **AND :** | ** ** | **CASCADES USA INC.**                                                      |
| ** **     | ** ** | ** **                                                                 |
| **AND :** | ** ** | **CASCADES EUROPE SAS**                                                    |
| ** **     | ** ** | ** **                                                                 |
|           |       | (each a  “Borrower” and collectively, the “Borrowers”) |
|           |       |                                                                       |
| **AND:**       | ** ** | **THE BANK OF NOVA SCOTIA**                                                |
| ** **     | ** ** | ** **                                                                 |
| ** **     | ** ** | (as “Agent”)                                                     |
| ** **     | ** ** | ** **                                                                 |
| **AND:**       | ** ** | **NATIONAL BANK OF CANADA**                                                |
| ** **     | ** ** | ** **                                                                 |
|           |       | (as  “Co-Agent”)                                                 |

 

**RECITALS**

 

A.                                   TheBorrowers, the Agent, the Co-Agent and the Lenders are party to a creditagreement dated as of December 29, 2006, as amended as of June 27,2007, March 28, 2008 and May 22, 2008 (the “Credit Agreement”).

 

B.                                     TheLenders have been requested by a request for amendments dated January 27,2009 (as revised on February 3, 2009) to agree to amendments describedbelow to the Credit Agreement.

 

C.                                     Theforegoing request has been agreed on by the Majority Lenders, and theBorrowers, the Agent and the Co-Agent wish to amend the Credit Agreement togive effect to the amendments contemplated in the request.

 

**NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:**

 

**1.****                                      Interpretation**

 

1.1                                 Capitalizedterms used herein and defined in the Credit Agreement have the meaningsassigned to them in the Credit Agreement unless otherwise defined herein.

 

1.2                                 ThisAgreement may be referred to as the Fourth Amendment to the December 29,2006 Cascades Credit Agreement.

 

1.3                                 Anyreference to the Credit Agreement in any Credit Document refers to the CreditAgreement as amended hereby.

 

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**2.****                                      Amendments to the Credit Agreement**

** **

2.1                                 Section 1.1of the Credit Agreement is amended by deleting clause (ii) in thedefinition of Credit Parties and replacing it with the following:

 

“(ii) MetroWaste Paper Recovery Inc. and its Subsidiaries until such time when all of theoutstanding shares of Metro Waste Paper Recovery Inc. carrying voting rights inall circumstances are directly or indirectly held by Cascades;”

 

2.2                                 Section 1.1of the Credit Agreement is amended by the addition of the following at the endof the current text of the definition of “Funded Debt to Capitalization Ratio”:

 

“providedthat for the purposes of the calculation of this ratio,

 

(a)                                  the mark-to-market value of Hedging Agreements relating toobligations for monies borrowed or raised in US Dollars (i) ifpositive, will be deducted from Funded Debt and (ii) if negative, will beincluded in Funded Debt;

 

(b)                                 preferred shares redeemable in cash at the option of the issuer withno possibility of redemption prior to the Revolving Facility Maturity Date andthe Term Facility Maturity Date or convertible in shares of another class atthe option of the issuer or holder thereof may be included in shareholders’equity (and excluded from Funded Debt) even if they are treated as liabilitiesunder GAAP.”

 

2.3                                 TheUnsecured Revolving Facility is terminated and cancelled and all provisions ofthe Credit Agreement relating thereto are to be read and are amendedaccordingly.

 

2.4                                 A newSection 1.2(e) is added to the Credit Agreement as follows:

 

“NotwithstandingSection 1.2(c), Cascades will designate Metro Waste Paper Recovery Inc.(and may designate any Subsidiary thereof) as a Designated Subsidiary onceMetro Waste Paper Recovery Inc. becomes a Credit Party regardless of the factthat Metro Waste Paper Recovery Inc. may not be at such time or thereafter awholly-owned Subsidiary of Cascades.”

 

2.5                                 Sections14.1 and 14.2 of the Credit Agreement is deleted and replaced by the following:

 

“14.1       **FundedDebt to Capitalization Ratio**

 

Cascadesmust maintain at all times, on an adjusted consolidated basis, a Funded Debt toCapitalization Ratio of not more than 65 %.

 

14.2         **InterestCoverage Ratio**

 

Cascadesmust maintain at all times, on an adjusted consolidated basis, an InterestCoverage Ratio not less than 2.25:1.00.”

 

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2.6                                 Schedule“A” to the Credit Agreement is amended by replacing the pricing grids thereinby the pricing grids in the attached Annex. Modifications of Rates resultingfrom such replacement will give rise to adjustments to Acceptance and Letter ofCredit fees previously calculated in the same manner as provided inparagraph 4 of Schedule “A” for modifications resulting from a changein a Rating.

 

**3.****                                      Effectiveness**

** **

ThisAgreement will become effective on the date hereof.

 

**4.****                                      Cost and Expenses**

** **

4.1                                 Cascadesmust pay to each Lender who has consented to the amendments described inSection 2 hereof no later than at 5:00 p.m. on February 12, 2009an amendment fee equal to 25 bps on such Lender’s total Commitment underthe Facilities at such time (excluding however its Commitment under theUnsecured Revolving Facility).

 

4.2                                 TheBorrowers agree to pay on demand all reasonable costs and expenses of the Agentin connection with the preparation, execution, delivery and implementation andadministration of this Agreement including the reasonable fees and expenses ofcounsel for the Agent and the Co-Agent.

 

**5.****                                      Confirmation**

** **

5.1                                 Eachof the Borrowers represents to the Agent and the Lenders that therepresentations and warranties set forth in the Credit Agreement are still trueand correct in all material respects and that this Agreement (i) has beenduly authorized by all necessary corporate actions, (ii) constitutes avalid and binding obligation of the Borrowers and (iii) will not result inany Default or Event of Default.

 

5.2                                 TheAgent and the Co-Agent confirm that the Majority Lenders have consented to theamendments described in Section 2.

 

**6.****                                      Counterparts**

 

ThisAgreement may be executed in any number of counterparts and by differentparties hereto in separate counterparts, each of which when so executed anddelivered will be deemed to be an original and all of which taken together willconstitute but one and the same agreement. Delivery of an executed counterpartof a signature page to this Agreement by telecopier or by electronicmail will be effective as delivery of a manually executed counterpart of thisAgreement.

 

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**7.****                                      Governing Law**

** **

ThisAgreement is governed by, and construed in accordance with, the laws ofthe Province of Quebec and of the laws of Canada applicable therein.

 

**IN WITNESS WHEREOF** theparties have caused this Agreement to be duly executed as of the date and yearfirst above written.

 

 
| ** ** | ** ** | **Cascades Inc.**                        |
|------------|------------|------------------------------------------|
| ** ** | ** ** | ** **                               |
|       |       | per:                                     |
|       |       |                                     |
|       |       |                                     | (s) Robert  F. Hall |
|       |       |                                     |
|       |       |                                     |
| ** ** | ** ** | **Cascades USA Inc.**                    |
| ** ** | ** ** | ** **                               |
|       |       | per:                                     |
|       |       |                                     |
|       |       |                                     | (s) Robert  F. Hall |
|       |       |                                     |   |
|       |       |                                     |
| ** ** | ** ** | **Cascades Europe SAS**                  |
| ** ** | ** ** | ** **                               |
|       |       | per:                                     |
|       |       |                                     | (s) Robert  F. Hall |
|       |       |                                     |   |
|       |       |                                     |
| ** ** | ** ** | **The Bank of Nova Scotia**, as Agent    |
| ** ** | ** ** | ** **                               |
|       |       | per:                                     |
|       |       |                                     | (s) Robert  Boomhour |
|       |       |                                     | Director |
|       |       |                                     |
| ** ** | ** ** | **National Bank of Canada**, as Co-Agent |
| ** ** | ** ** | ** **                               |
|       |       | per:                                     |
|       |       |                                     | (s) Dominic  Albanese |
|       |       |                                     | Director |
|       |       |                                     |
|       |       | per:                                     |
|       |       |                                     | (s) Roch  Ledoux |
|       |       |                                     | Director |

 

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We, theundersigned, as Designated Subsidiaries and guarantors under the CreditAgreement, hereby agree with the terms of this Fourth Amending Agreement.

 

**CASCADES BOXBOARD U.S., INC.CASCADES CANADA INC. CASCADES PAPERBOARD INTERNATIONAL INC.6265642 CANADA INC.SCIERIE LEMAY INC.RABOTAGE LEMAY INC.DOPACO, INC.DOPACO PACIFIC LLCDOPACO LIMITED PARTNERSHIPDOPACO CANADA, INC.GARVEN INCORPORATEDCONFERENCE CUP LTD.CASCADES BOXBOARD GROUP — CONNECTICUT LLCCASCADES AUBURN FIBER INC.CASCADES MOULDED PULP, INC.CASCADES PLASTICS INC.CASCADES FINE PAPERS GROUP INC.CASCADES FINE PAPERS GROUP (SALES) INC.CASCADES FINE PAPERS GROUP (USA) INC.W.H. SMITH PAPER CORPORATION CASCADES TISSUE GROUP — ARIZONA INC.CASCADES TISSUE GROUP — IFC DISPOSABLES INC.CASCADES TISSUE GROUP — NEW YORK INC.CASCADES TISSUE GROUP — NORTH CAROLINA INC.CASCADES TISSUE GROUP — OREGON INC.CASCADES TISSUE GROUP — PENNSYLVANIA INC.CASCADES TISSUE GROUP — WISCONSIN INC.CASCADES TISSUE GROUP — TENNESSEE INC.CASCADES TISSUE GROUP — SALES INC.CASCADES TISSUE GROUP — PICKERING INC.CASCADES TISSUE GROUP — MARYLAND LLCNORAMPAC HOLDING US INC.NORAMPAC NEW YORK CITY INC.NORAMPAC LEOMINSTER INC.NORAMPAC FINANCE US INC.NORAMPAC INDUSTRIES INC.NORAMPAC DELAWARE LLC**

 

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**NORAMPAC THOMPSON INC.NORAMPAC SCHENECTADY INC.CASCADES TRANSPORT INC.KINGSEY FALLS INVESTMENTS INC.CASCADES ENERGY INITIATIVE INC.CASCADES DELAWARE LLCNORAMPAC INC.CASCADES ENVIROPAC HPM LLC**

**6806813 CANADA INC.**

**6806805 CANADA INC.**

**6806783 CANADA INC.**

 

each of the foregoing entities being represented by Robert F. Hall,duly authorized as he so declares:

 
| (s) Robert  F. Hall |   |
|--------------------------|--------|

 

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**A N N E X**

 

**APPLICABLE MARGINS OR RATES**

** **

RevolvingFacility

 
| **Rating**         | ** ** | **Prime, US Base** | ** ** | **Acceptance Fee / Libor   European Rate/L/C Fee** | ** ** | **Stand-By Fee** |
|--------------------|------------|-------------------------|------------|---------------------------------------------------------|------------|------------------|
| BBB/Baa2 or Higher |       | 165 bps                 |       | 265 bps                                                 |       | 65 bps           |
| BBB-/Baa3          |       | 175 bps                 |       | 275 bps                                                 |       | 70 bps           |
| BB+/Bal            |       | 195 bps                 |       | 295 bps                                                 |       | 75 bps           |
| BB/Ba2             |       | 225 bps                 |       | 325 bps                                                 |       | 80 bps           |
| BB-/Ba3 or Lower   |       | 250 bps                 |       | 350 bps                                                 |       | 87.5 bps         |

** **

TermLoan

 
| **Rating**          | ** ** | **Prime, US Base** | ** ** | **Acceptance Fee / Libor** |
|---------------------|------------|-------------------------|------------|----------------------------|
| BBB-/Baa3 or Higher |       | 187.5 bps               |       | 287.5 bps                  |
| BB+/Bal             |       | 207.5 bps               |       | 307.5 bps                  |
| BB/Ba2              |       | 237.5 bps               |       | 337.5 bps                  |
| BB-/Ba3 or Lower    |       | 262.5 bps               |       | 362.5 bps                  |

 

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