Document:

EXHIBIT 10.3

August 28, 2000

TO:  UPM-KYMMENE CORPORATION
     Etelaesplanadi 2
     FIN - 00101
     Helsinki, Finland

Ladies and Gentlemen:

Re:  Acquisition of Repap Enterprises Inc.

In consideration  of UPM-Kymmene  Corporation  ("UPM-Kymmene")  entering into an
acquisition  agreement  dated the date hereof  with,  and  agreeing to cause its
wholly-owned   subsidiary  to  participate  in  an  amalgamation   with,   Repap
Enterprises  Inc.  ("Repap")  (the  "Transaction"),  this letter  agreement (the
"Agreement")  sets out the terms on which The Third Avenue Trust,  for the Third
Avenue  Value Fund Series and the Third  Avenue Small Cap Value Fund Series (the
"Shareholder")  undertakes  to take  certain  actions  and do certain  things in
respect of the Transaction.

The terms of the Transaction  are summarized in the acquisition  agreement dated
the date hereof between UPM-Kymmene and Repap (the "Acquisition Agreement"), and
terms used herein and not otherwise defined shall have the meanings set forth in
the  Acquisition  Agreement.  A copy of the  Acquisition  Agreement  is attached
hereto as Schedule 1.

1.   Representations and Warranties of the Shareholder and UPM-Kymmene

1.1  The  Shareholder  hereby  represents and warrants to you (and  acknowledges
     that you are relying upon such representations and warranties):

     (a)  that the common shares in the capital of Repap set forth on Schedule 2
          to this  Agreement  (the  "Shares")  include all common shares held of
          record,  beneficially  owned by, or for  which  voting or  dispositive
          power is  granted  to the  Shareholder  or to any  trust or  associate
          thereof for the benefit of the  Shareholder.  The Shareholder has sole
          voting power,  and, unless  otherwise  stated,  has exclusive right of
          disposition and sole power to agree to all of the matters set forth in
          this  Agreement.  The  Shareholder  or other owners of such Shares has
          good and marketable title to its Shares, free and clear of any and all
          liens, pledges, mortgages, charges, restrictions,  security interests,
          adverse  claims and  demands or rights of others of any nature or kind
          whatsoever  ("Encumbrances"),  except as otherwise noted on Schedule 2
          (which Encumbrances will be fully and completely  discharged as of the
          Effective Date). Other than the Shares, no common shares or securities
          of Repap  convertible  into common  shares are  beneficially  owned or
          controlled, directly or indirectly, by the Shareholder;

     (b)  the  Shareholder  has the legal  capacity to execute and deliver  this
          Agreement and to consummate the transactions contemplated hereby. This
          Agreement  has been duly  executed and  delivered by the  Shareholder,
          and,  assuming  the  due  authorization,  execution  and  delivery  by
          UPM-Kymmene,  this Agreement  constitutes the legal, valid and binding
          obligation of the  Shareholder,  enforceable  against it in accordance
          with its terms, subject to laws of general application and bankruptcy,
          insolvency  and  other  similar  laws  affecting   creditors'   rights
          generally and general principles of equity;

     (c)  neither  the  execution   and  delivery  of  this   Agreement  by  the
          Shareholder,  the  consummation by the Shareholder of the transactions
          contemplated  hereby nor the compliance by the Shareholder with any of
          the  provisions  hereof  shall:  (i)  result  in  any  breach  of,  or
          constitute  a default  (or an event which with notice or lapse of time
          or both would become a default) (or give rise to any third party right
          of termination,  cancellation,  material modification or acceleration)
          under any of the terms,  conditions or  provisions  of any note,  loan
          agreement, bond, mortgage,  indenture,  contract,  license, agreement,
          lease,   permit  or  other  instrument  or  obligation  to  which  the
          Shareholder  is a party  or by  which  the  Shareholder  or any of its
          properties or assets (including its Shares) may be bound, (ii) require
          on the part of the Shareholder any filing with (other than pursuant to
          the requirements of applicable  securities  legislation (which filings
          the Shareholder will undertake)) or permit, authorization,  consent or
          approval of, any Governmental  Entity,  or (iii) subject to compliance
          with any orders or laws  contemplated  by the  Acquisition  Agreement,
          violate  any  order,  writ,  injunction,  decree,  judgment,  or  Laws
          applicable  to the  Shareholder  or any of its  properties  or assets,
          excluding from the foregoing such  violations,  breaches,  defaults or
          failures  to make any filing or to obtain any  permit,  authorization,
          consent or approval which would not, individually or in the aggregate,
          impair the ability of the  Shareholder to consummate the  transactions
          contemplated hereby;

     (d)  that there is no private or  governmental  action,  suit,  proceeding,
          claim,  arbitration or  investigation  pending before any Governmental
          Entity,  or, to the knowledge of the Shareholder,  threatened  against
          the Shareholder or any of its properties that,  individually or in the
          aggregate,  could  reasonably  be expected to have a material  adverse
          effect on the  Shareholder's  ability to consummate  the  transactions
          contemplated by this Agreement.  There is no judgment, decree or order
          against  the  Shareholder  that  could  prevent,   enjoin,   alter  or
          materially  delay  any  of  the  transactions   contemplated  by  this
          Agreement,  or that could  reasonably  be  expected to have a material
          adverse  effect  on  the  Shareholder's   ability  to  consummate  the
          transactions contemplated by this Agreement; and

     (e)  the  Shareholder  has not  previously  granted  or agreed to grant any
          proxy or other right to vote in respect of its Shares or entered  into
          any voting trust,  nor pooling or other  agreement with respect to the
          right to vote, to call meetings of shareholders or to give consents or
          approvals  of any kind as to its  Shares  except  those  which  are no
          longer of any force or effect.

1.2  UPM-Kymmene   hereby  represents  and  warrants  to  the  Shareholder  (and
     acknowledges that the Shareholder is relying upon such  representations and
     warranties):

     (a)  that  UPM-Kymmene is a company duly  incorporated and validly existing
          under the laws of Finland; and

     (b)  that  UPM-Kymmene  has the requisite power and authority to enter into
          this Agreement and to consummate the transactions contemplated hereby,
          and that this Agreement  constitutes the valid and binding  obligation
          of UPM-Kymmene. This Agreement has been duly executed and delivered by
          UPM-Kymmene  and,  assuming  the due  execution  and  delivery  by the
          Shareholder,  is enforceable  against it in accordance with its terms,
          subject to laws of general application and bankruptcy,  insolvency and
          other similar laws affecting  creditors'  rights generally and general
          principles of equity.

2.   Voting Rights

2.1  The  Shareholder  hereby  represents and warrants to you and covenants with
     you that,  between the date of this  Agreement  and the earlier of: (a) the
     date of termination  of the  Acquisition  Agreement in accordance  with its
     terms, (b) the date of termination of this Agreement in accordance with its
     terms;  and (c) the Effective  Date of the  Transaction  (such earlier date
     being the "Expiry Date"),  the Shareholder  shall not: (i) sell,  transfer,
     gift, assign, pledge, hypothecate,  encumber or otherwise dispose of any of
     its Shares or enter into any  agreement,  arrangement or  understanding  in
     connection  therewith,  without  having first  obtained  the prior  written
     consent of UPM-Kymmene,  or (ii) except as contemplated  herein,  grant any
     proxies or powers of  attorney,  deposit its Shares into a voting  trust or
     enter into a voting agreement, understanding or arrangement with respect to
     such Shares,  without  having first  obtained the prior written  consent of
     UPM-Kymmene.

2.2  The Shareholder  agrees that, until the Expiry Date, it shall not, directly
     or indirectly, negotiate with, solicit, initiate or encourage submission of
     proposals  or offers from,  or provide  information  to, any other  person,
     entity or group relating to an Acquisition Proposal or any Shares.

2.3  The Shareholder hereby irrevocably undertakes, until the Expiry Date:

     (a)  to vote (or cause to be voted)  all the  Shares at any  meeting of the
          shareholders  of Repap,  and in any action by  written  consent of the
          shareholders  of  Repap:  (i)  in  favour  of the  approval,  consent,
          ratification and adoption of the Transaction (and any actions required
          in  furtherance  thereof);  and (ii)  against  any  action  that would
          impede, interfere or discourage the Transaction (including for greater
          certainty in favour of any Superior  Proposal)  and against any action
          that would  result in any breach of any  representation,  warranty  or
          covenant  of  Repap in the  Acquisition  Agreement.  Upon the  written
          request or direction of UPM-Kymmene,  the Shareholder  shall execute a
          form of proxy (effective only until the Expiry Date) in respect of any
          such  resolution  appointing such person or persons as UPM-Kymmene may
          request  or direct as proxy for such  Shareholder,  with full power of
          substitution,  to attend,  vote and otherwise act for and on behalf of
          the  Shareholder  in  respect of all Shares and in respect of all such
          matters which may come before a meeting of the  shareholders  of Repap
          relating to the Transaction (other than any change in the terms of the
          Transaction  which would decrease the value of the consideration to be
          received by the  Shareholder)  including any action that would impede,
          interfere or discourage the Transaction and the Shareholder  shall not
          be responsible for the voting under such proxy; and

     (b)  not to, without the prior written consent of UPM-Kymmene,  requisition
          or join in the requisition of any meeting of the shareholders of Repap
          for the purpose of considering  any resolution  with respect to any of
          the matters referred to in subsection 2.3(a).

3.   Superior Proposal

3.1  In the event that a  Superior  Proposal  is made,  announced  or  otherwise
     disclosed  to  Repap's  shareholders  on or prior to the Expiry  Date,  and
     either:

     (a)  the Match  Period (as  defined in  Section  4.6(1) of the  Acquisition
          Agreement) has expired without UPM-Kymmene having offered to amend the
          terms of the  Acquisition  Agreement as contemplated by Section 4.6(2)
          of the Acquisition Agreement; or

     (b)  the Match Period has expired,  and the Board of Directors of Repap has
          rejected an offer to amend the terms of the Acquisition Agreement made
          by UPM-Kymmene in accordance  with the provisions of Section 4.6(2) of
          the Acquisition Agreement;

     the  Shareholder  shall have the right to  terminate  this  Agreement  upon
     notice to UPM-Kymmene.

4.   Covenants

4.1  The Shareholder agrees:

     (a)  to details of this Agreement being set out in any information circular
          produced  by,  or any  filing  to be made  with the OSC or the SEC by,
          Repap and/or UPM-Kymmene in connection with the Transaction;

     (b)  to this Agreement being filed as an exhibit to any document filed with
          the OSC or the SEC or otherwise  being available for inspection to the
          extent required by Law; and

     (c)  that an award of monetary  damages would not be an adequate remedy for
          any loss incurred by reason of any breach of this  Agreement and that,
          in the event of any breach or threatened  breach of this  Agreement by
          the  Shareholder,  UPM-Kymmene  will be entitled to equitable  relief,
          including  injunctive relief and specific  performance.  Such remedies
          will not be the exclusive remedies for any breach or threatened breach
          of this  Agreement by the  Shareholder  but will be in addition to all
          other remedies available at law or in equity to UPM-Kymmene.

4.2  UPM-Kymmene  agrees not to amend the definition of the term "Outside Date",
     section 2.4,  subsection  6.3(1),  subsection  6.3(2),  clause 6.3(3)(d) or
     subsection  6.3(4) of the Acquisition  Agreement  without the prior written
     consent  of the  Shareholder,  which  consent  shall  not  be  unreasonably
     withheld.

4.3  The Shareholder  agrees,  until the Expiry Date, not to exercise any rights
     of dissent.

5.   Miscellaneous

5.1  The headings in this  Agreement are for reference only and shall not affect
     the meaning or interpretation of this Agreement.

5.2  This Agreement  (including the Schedules  attached hereto)  constitutes the
     entire  agreement and supersedes all prior  agreements and  understandings,
     both oral and written, among the parties with respect to the subject matter
     hereof.

5.3  Any  provision in this  Agreement may be amended or waived if, and only if,
     such  amendment  or  waiver is in  writing  and  signed,  in the case of an
     amendment,  by the  Shareholder and UPM-Kymmene or in the case of a waiver,
     by the party  against  whom the  waiver is to be  effective.  No failure or
     delay by any party in exercising  any right,  power or privilege  hereunder
     shall operate as a waiver thereof nor shall any single or partial  exercise
     thereof preclude any other or further exercise.

5.4  Any date,  time or period  referred  to in this  Agreement  shall be of the
     essence except to the extent to which UPM-Kymmene and the Shareholder agree
     in writing  to vary any date,  time or  period,  in which  event the varied
     date, time or period shall be of the essence.

5.5  Each of  UPM-Kymmene  and  the  Shareholder  shall  bear  its own  expenses
     incurred  in  connection   with  this   Agreement   and  the   transactions
     contemplated hereby.

5.6  All notices,  requests,  claims, demands and other communications hereunder
     shall be in  writing  and shall be given  (and shall be deemed to have been
     duly given upon receipt) by delivery in person, by telecopy,  or facsimile,
     or by a nationally  recognized courier service to the respective parties at
     their addresses as specified in Schedule 3 hereto.

5.7  If any term or other  provision of this  Agreement  is invalid,  illegal or
     incapable of being enforced by any rule of law or public policy,  all other
     conditions and provisions of this Agreement  shall  nevertheless  remain in
     full force and effect so long as the  economic or legal  substance  of this
     Agreement  is not affected in any manner  materially  adverse to any party.
     Upon  such  determination  that  any term or other  provision  is  invalid,
     illegal or incapable of being enforced,  the parties hereto shall negotiate
     in good faith to modify this Agreement so as to effect the original  intent
     of the parties as closely as possible  in a mutually  acceptable  manner in
     order that the terms of this Agreement remain as originally contemplated to
     the fullest extent possible.

5.8  The  provisions  of this  Agreement  shall be binding upon and enure to the
     benefit of the parties hereto and their respective successors and permitted
     assigns,  provided that no party may assign, delegate or otherwise transfer
     any of its rights,  interests or obligations  under this Agreement  without
     the  prior  written  consent  of  the  other  party  hereto,   except  that
     UPM-Kymmene may assign,  delegate or otherwise  transfer any of its rights,
     interests or obligations under this Agreement to a wholly-owned subsidiary,
     without reducing its own obligations hereunder,  without the consent of the
     Shareholder.

5.9  This  Agreement  is governed by the laws of the Province of Ontario and the
     federal  laws  of  Canada  applicable   therein.   The  Shareholder  hereby
     irrevocably  attorns to the  jurisdiction  of the Courts of the Province of
     Ontario and  irrevocably  agrees that the Courts of the Province of Ontario
     are to have  jurisdiction  to settle any disputes which may arise out of or
     in connection with this Agreement and that,  accordingly,  any suit, action
     or proceeding  ("Proceedings")  arising out of or in  connection  with this
     Agreement may be brought in such Courts.  The Shareholder hereby waives any
     objection  which  it  may  have  now  or  hereafter  to  the  venue  of any
     Proceedings in the Courts of the Province of Ontario and any claim that any
     Proceedings  have  been  brought  in  an  inconvenient  forum  and  further
     irrevocably agrees that a judgment in any Proceedings brought in the Courts
     of the  Province  of  Ontario  shall be  conclusive  and  binding  upon the
     Shareholder and may be enforced in the courts of any other jurisdiction.

5.10 This   Agreement   may  be  executed  by  facsimile  and  in  one  or  more
     counterparts, all of which shall be considered one and the same agreement.

This Agreement has been agreed and accepted this 28th day of August, 2000.

                                        THE THIRD AVENUE TRUST, for the
                                        Third Avenue Value Fund Series and The
                                        Third Avenue Small Cap Value Fund Series

                                        By:  /s/ Martin J. Whitman
                                           -------------------------------------
                                           Name:  Martin J. Whitman
                                           Title: Chairman

                                        UPM-KYMMENE CORPORATION
                                        By:  /s/ Juha Niemela
                                           -------------------------------------
                                           Name:  Juha Niemela
                                           Title: President and CEO
                                                  UPM-Kymmene Corporation
<PAGE>

                                   Schedule 1

                              ACQUISITION AGREEMENT

Please see the attached.
<PAGE>

                                   Schedule 2

--------------------------------------------------------------------------------
            Shareholder                            Number of Shares
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The Third Avenue Value Fund Series                    110,174,479
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The Third  Avenue Small Cap Value Fund Series          12,253,700
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TOTAL                                                 122,428,179
--------------------------------------------------------------------------------
<PAGE>

                                   Schedule 3

Address

UPM-Kymmene Corporation
Etelaesplanadi 2
FIN - 00101
Helsinki, Finland
Attention:       Reko Aalto-Setala
Telecopier No.:  (358) 204 15 0304

with a copy to:

Osler, Hoskin & Harcourt LLP
100 King Street West, Suite 6100
First Canadian Place
Toronto, Ontario  M5X 1B8
Attention:       Dale R. Ponder
Telecopier No.:  (416) 862-6666

White & Case LLP
1155 Avenue of the Americas
New York, New York
10036-2787
Attention:       Timothy B. Goodell
Telecopier No.:  (212) 354-8113

The Third Avenue Trust, for the
Third Avenue Value Fund Series and the
Third Avenue Small Cap Value Fund Series
767 Third Avenue
New York, NY   10017
Attention:       Marty Whitman
Telecopier No.:  (212) 888-6704EXHIBIT 10.4

August 28, 2000

TO:  UPM-KYMMENE CORPORATION
     Etelaesplanadi 2
     FIN - 00101
     Helsinki, Finland

Ladies and Gentlemen:

Re:  Acquisition of Repap Enterprises Inc.

In consideration  of UPM-Kymmene  Corporation  ("UPM-Kymmene")  entering into an
acquisition  agreement  dated the date hereof  with,  and  agreeing to cause its
wholly-owned   subsidiary  to  participate  in  an  amalgamation   with,   Repap
Enterprises  Inc.  ("Repap")  (the  "Transaction"),  this letter  agreement (the
"Agreement")  sets  out the  terms  on  which  TD  Asset  Management  Inc.  (the
"Shareholder")  undertakes  to take  certain  actions  and do certain  things in
respect of the Transaction.

The terms of the Transaction  are summarized in the acquisition  agreement dated
the date hereof between UPM-Kymmene and Repap (the "Acquisition Agreement"), and
terms used herein and not otherwise defined shall have the meanings set forth in
the  Acquisition  Agreement.  A copy of the  Acquisition  Agreement  is attached
hereto as Schedule 1.

1.   Representations and Warranties of the Shareholder and UPM-Kymmene

1.1  The  Shareholder  hereby  represents and warrants to you (and  acknowledges
     that you are relying upon such representations and warranties):

     (a)  that the common shares in the capital of Repap set forth on Schedule 2
          to this  Agreement  (the  "Shares")  include all common shares held of
          record,  beneficially  owned by, or for  which  voting or  dispositive
          power is  granted  to the  Shareholder  or to any  trust or  associate
          thereof for the benefit of the  Shareholder.  The Shareholder has sole
          voting power,  and, unless  otherwise  stated,  has exclusive right of
          disposition and sole power to agree to all of the matters set forth in
          this  Agreement.  The  Shareholder  or other owners of such Shares has
          good and marketable title to its Shares, free and clear of any and all
          liens, pledges, mortgages, charges, restrictions,  security interests,
          adverse  claims and  demands or rights of others of any nature or kind
          whatsoever  ("Encumbrances"),  except as otherwise noted on Schedule 2
          (which Encumbrances will be fully and completely  discharged as of the
          Effective Date). Other than the Shares, no common shares or securities
          of Repap  convertible  into common  shares are  beneficially  owned or
          controlled, directly or indirectly, by the Shareholder;

     (b)  the  Shareholder  has the legal  capacity to execute and deliver  this
          Agreement and to consummate the transactions contemplated hereby. This
          Agreement  has been duly  executed and  delivered by the  Shareholder,
          and,  assuming  the  due  authorization,  execution  and  delivery  by
          UPM-Kymmene,  this Agreement  constitutes the legal, valid and binding
          obligation of the  Shareholder,  enforceable  against it in accordance
          with its terms, subject to laws of general application and bankruptcy,
          insolvency  and  other  similar  laws  affecting   creditors'   rights
          generally and general principles of equity;

     (c)  neither  the  execution   and  delivery  of  this   Agreement  by  the
          Shareholder,  the  consummation by the Shareholder of the transactions
          contemplated  hereby nor the compliance by the Shareholder with any of
          the  provisions  hereof  shall:  (i)  result  in  any  breach  of,  or
          constitute  a default  (or an event which with notice or lapse of time
          or both would become a default) (or give rise to any third party right
          of termination,  cancellation,  material modification or acceleration)
          under any of the terms,  conditions or  provisions  of any note,  loan
          agreement, bond, mortgage,  indenture,  contract,  license, agreement,
          lease,   permit  or  other  instrument  or  obligation  to  which  the
          Shareholder  is a party  or by  which  the  Shareholder  or any of its
          properties or assets (including its Shares) may be bound, (ii) require
          on the part of the Shareholder any filing with (other than pursuant to
          the requirements of applicable  securities  legislation (which filings
          the Shareholder will undertake)) or permit, authorization,  consent or
          approval of, any Governmental  Entity,  or (iii) subject to compliance
          with any orders or laws  contemplated  by the  Acquisition  Agreement,
          violate  any  order,  writ,  injunction,  decree,  judgment,  or  Laws
          applicable  to the  Shareholder  or any of its  properties  or assets,
          excluding from the foregoing such  violations,  breaches,  defaults or
          failures  to make any filing or to obtain any  permit,  authorization,
          consent or approval which would not, individually or in the aggregate,
          impair the ability of the  Shareholder to consummate the  transactions
          contemplated hereby;

     (d)  that there is no private or  governmental  action,  suit,  proceeding,
          claim,  arbitration or  investigation  pending before any Governmental
          Entity,  or, to the knowledge of the Shareholder,  threatened  against
          the Shareholder or any of its properties that,  individually or in the
          aggregate,  could  reasonably  be expected to have a material  adverse
          effect on the  Shareholder's  ability to consummate  the  transactions
          contemplated by this Agreement.  There is no judgment, decree or order
          against  the  Shareholder  that  could  prevent,   enjoin,   alter  or
          materially  delay  any  of  the  transactions   contemplated  by  this
          Agreement,  or that could  reasonably  be  expected to have a material
          adverse  effect  on  the  Shareholder's   ability  to  consummate  the
          transactions contemplated by this Agreement; and

     (e)  the  Shareholder  has not  previously  granted  or agreed to grant any
          proxy or other right to vote in respect of its Shares or entered  into
          any voting trust,  nor pooling or other  agreement with respect to the
          right to vote, to call meetings of shareholders or to give consents or
          approvals  of any kind as to its  Shares  except  those  which  are no
          longer of any force or effect.

1.2  UPM-Kymmene   hereby  represents  and  warrants  to  the  Shareholder  (and
     acknowledges that the Shareholder is relying upon such  representations and
     warranties):

     (a)  that  UPM-Kymmene is a company duly  incorporated and validly existing
          under the laws of Finland; and

     (b)  that  UPM-Kymmene  has the requisite power and authority to enter into
          this Agreement and to consummate the transactions contemplated hereby,
          and that this Agreement  constitutes the valid and binding  obligation
          of UPM-Kymmene. This Agreement has been duly executed and delivered by
          UPM-Kymmene  and,  assuming  the due  execution  and  delivery  by the
          Shareholder,  is enforceable  against it in accordance with its terms,
          subject to laws of general application and bankruptcy,  insolvency and
          other similar laws affecting  creditors'  rights generally and general
          principles of equity.

2.   Voting Rights

2.1  The  Shareholder  hereby  represents and warrants to you and covenants with
     you that,  between the date of this  Agreement  and the earlier of: (a) the
     date of termination  of the  Acquisition  Agreement in accordance  with its
     terms, (b) the date of termination of this Agreement in accordance with its
     terms;  and (c) the Effective  Date of the  Transaction  (such earlier date
     being the "Expiry Date"),  the Shareholder  shall not: (i) sell,  transfer,
     gift, assign, pledge, hypothecate,  encumber or otherwise dispose of any of
     its Shares or enter into any  agreement,  arrangement or  understanding  in
     connection  therewith,  without  having first  obtained  the prior  written
     consent of UPM-Kymmene,  or (ii) except as contemplated  herein,  grant any
     proxies or powers of  attorney,  deposit its Shares into a voting  trust or
     enter into a voting agreement, understanding or arrangement with respect to
     such Shares,  without  having first  obtained the prior written  consent of
     UPM-Kymmene.

2.2  The Shareholder  agrees that, until the Expiry Date, it shall not, directly
     or indirectly, negotiate with, solicit, initiate or encourage submission of
     proposals  or offers from,  or provide  information  to, any other  person,
     entity or group relating to an Acquisition Proposal or any Shares.

2.3  The Shareholder hereby irrevocably undertakes, until the Expiry Date:

     (a)  to vote (or cause to be voted)  all the  Shares at any  meeting of the
          shareholders  of Repap,  and in any action by  written  consent of the
          shareholders  of  Repap:  (i)  in  favour  of the  approval,  consent,
          ratification and adoption of the Transaction (and any actions required
          in  furtherance  thereof);  and (ii)  against  any  action  that would
          impede, interfere or discourage the Transaction (including for greater
          certainty in favour of any Superior  Proposal)  and against any action
          that would  result in any breach of any  representation,  warranty  or
          covenant  of  Repap in the  Acquisition  Agreement.  Upon the  written
          request or direction of UPM-Kymmene,  the Shareholder  shall execute a
          form of proxy (effective only until the Expiry Date) in respect of any
          such  resolution  appointing such person or persons as UPM-Kymmene may
          request  or direct as proxy for such  Shareholder,  with full power of
          substitution,  to attend,  vote and otherwise act for and on behalf of
          the  Shareholder  in  respect of all Shares and in respect of all such
          matters which may come before a meeting of the  shareholders  of Repap
          relating to the Transaction (other than any change in the terms of the
          Transaction  which would decrease the value of the consideration to be
          received by the  Shareholder)  including any action that would impede,
          interfere or discourage the Transaction and the Shareholder  shall not
          be responsible for the voting under such proxy; and

     (b)  not to, without the prior written consent of UPM-Kymmene,  requisition
          or join in the requisition of any meeting of the shareholders of Repap
          for the purpose of considering  any resolution  with respect to any of
          the matters referred to in subsection 2.3(a).

3.   Superior Proposal

3.1  In the event that a  Superior  Proposal  is made,  announced  or  otherwise
     disclosed  to  Repap's  shareholders  on or prior to the Expiry  Date,  and
     either:

     (a)  the Match  Period (as  defined in  Section  4.6(1) of the  Acquisition
          Agreement) has expired without UPM-Kymmene having offered to amend the
          terms of the  Acquisition  Agreement as contemplated by Section 4.6(2)
          of the Acquisition Agreement; or

     (b)  the Match Period has expired,  and the Board of Directors of Repap has
          rejected an offer to amend the terms of the Acquisition Agreement made
          by UPM-Kymmene in accordance  with the provisions of Section 4.6(2) of
          the Acquisition Agreement;

     the  Shareholder  shall have the right to  terminate  this  Agreement  upon
     notice to UPM-Kymmene.

4.   Covenants

4.1  The Shareholder agrees:

     (a)  to details of this Agreement being set out in any information circular
          produced  by,  or any  filing  to be made  with the OSC or the SEC by,
          Repap and/or UPM-Kymmene in connection with the Transaction;

     (b)  to this Agreement being filed as an exhibit to any document filed with
          the OSC or the SEC or otherwise  being available for inspection to the
          extent required by Law; and

     (c)  that an award of monetary  damages would not be an adequate remedy for
          any loss incurred by reason of any breach of this  Agreement and that,
          in the event of any breach or threatened  breach of this  Agreement by
          the  Shareholder,  UPM-Kymmene  will be entitled to equitable  relief,
          including  injunctive relief and specific  performance.  Such remedies
          will not be the exclusive remedies for any breach or threatened breach
          of this  Agreement by the  Shareholder  but will be in addition to all
          other remedies available at law or in equity to UPM-Kymmene.

4.2  UPM-Kymmene  agrees not to amend the definition of the term "Outside Date",
     section 2.4,  subsection  6.3(1),  subsection  6.3(2),  clause 6.3(3)(d) or
     subsection  6.3(4) of the Acquisition  Agreement  without the prior written
     consent  of the  Shareholder,  which  consent  shall  not  be  unreasonably
     withheld.

4.3  The Shareholder  agrees,  until the Expiry Date, not to exercise any rights
     of dissent.

5.   Miscellaneous

5.1  The headings in this  Agreement are for reference only and shall not affect
     the meaning or interpretation of this Agreement.

5.2  This Agreement  (including the Schedules  attached hereto)  constitutes the
     entire  agreement and supersedes all prior  agreements and  understandings,
     both oral and written, among the parties with respect to the subject matter
     hereof.

5.3  Any  provision in this  Agreement may be amended or waived if, and only if,
     such  amendment  or  waiver is in  writing  and  signed,  in the case of an
     amendment,  by the  Shareholder and UPM-Kymmene or in the case of a waiver,
     by the party  against  whom the  waiver is to be  effective.  No failure or
     delay by any party in exercising  any right,  power or privilege  hereunder
     shall operate as a waiver thereof nor shall any single or partial  exercise
     thereof preclude any other or further exercise.

5.4  Any date,  time or period  referred  to in this  Agreement  shall be of the
     essence except to the extent to which UPM-Kymmene and the Shareholder agree
     in writing  to vary any date,  time or  period,  in which  event the varied
     date, time or period shall be of the essence.

5.5  Each of  UPM-Kymmene  and  the  Shareholder  shall  bear  its own  expenses
     incurred  in  connection   with  this   Agreement   and  the   transactions
     contemplated hereby.

5.6  All notices,  requests,  claims, demands and other communications hereunder
     shall be in  writing  and shall be given  (and shall be deemed to have been
     duly given upon receipt) by delivery in person, by telecopy,  or facsimile,
     or by a nationally  recognized courier service to the respective parties at
     their addresses as specified in Schedule 3 hereto.

5.7  If any term or other  provision of this  Agreement  is invalid,  illegal or
     incapable of being enforced by any rule of law or public policy,  all other
     conditions and provisions of this Agreement  shall  nevertheless  remain in
     full force and effect so long as the  economic or legal  substance  of this
     Agreement  is not affected in any manner  materially  adverse to any party.
     Upon  such  determination  that  any term or other  provision  is  invalid,
     illegal or incapable of being enforced,  the parties hereto shall negotiate
     in good faith to modify this Agreement so as to effect the original  intent
     of the parties as closely as possible  in a mutually  acceptable  manner in
     order that the terms of this Agreement remain as originally contemplated to
     the fullest extent possible.

5.8  The  provisions  of this  Agreement  shall be binding upon and enure to the
     benefit of the parties hereto and their respective successors and permitted
     assigns,  provided that no party may assign, delegate or otherwise transfer
     any of its rights,  interests or obligations  under this Agreement  without
     the  prior  written  consent  of  the  other  party  hereto,   except  that
     UPM-Kymmene may assign,  delegate or otherwise  transfer any of its rights,
     interests or obligations under this Agreement to a wholly-owned subsidiary,
     without reducing its own obligations hereunder,  without the consent of the
     Shareholder.

5.9  This  Agreement  is governed by the laws of the Province of Ontario and the
     federal  laws  of  Canada  applicable   therein.   The  Shareholder  hereby
     irrevocably  attorns to the  jurisdiction  of the Courts of the Province of
     Ontario and  irrevocably  agrees that the Courts of the Province of Ontario
     are to have  jurisdiction  to settle any disputes which may arise out of or
     in connection with this Agreement and that,  accordingly,  any suit, action
     or proceeding  ("Proceedings")  arising out of or in  connection  with this
     Agreement may be brought in such Courts.  The Shareholder hereby waives any
     objection  which  it  may  have  now  or  hereafter  to  the  venue  of any
     Proceedings in the Courts of the Province of Ontario and any claim that any
     Proceedings  have  been  brought  in  an  inconvenient  forum  and  further
     irrevocably agrees that a judgment in any Proceedings brought in the Courts
     of the  Province  of  Ontario  shall be  conclusive  and  binding  upon the
     Shareholder and may be enforced in the courts of any other jurisdiction.

5.10 This   Agreement   may  be  executed  by  facsimile  and  in  one  or  more
     counterparts, all of which shall be considered one and the same agreement.

This Agreement has been agreed and accepted this 28th day of August, 2000.

                                      TD ASSET MANAGEMENT INC.
                                      By:  /s/ R.F. MacLellan
                                         ---------------------------------------
                                         Name:  R.F. MacLellan
                                         Title: Chair
                                                TDAM

                                      UPM-KYMMENE CORPORATION
                                      By:  /s/ Juha Niemela
                                         ---------------------------------------
                                         Name:  Juha Niemela
                                         Title: President and CEO
                                                UPM-Kymmene Corporation
<PAGE>

                                   Schedule 1

                              ACQUISITION AGREEMENT

Please see the attached.
<PAGE>

                                   Schedule 2

--------------------------------------------------------------------------------
              Shareholder                      Number of Shares
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TD Bank Pension Fund                              17,250,000
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TD Bank
- Corporate Account                               23,809,523
- Lancaster Account                               17,000,000
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Mutual Funds
- Canadian Equity                                 42,500,000
- Resource Fund                                    6,000,000
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TOTAL                                            106,559,523
--------------------------------------------------------------------------------
<PAGE>

                                   Schedule 3

Address

UPM-Kymmene Corporation
Etelaesplanadi 2
FIN - 00101
Helsinki, Finland
Attention:       Reko Aalto-Setala
Telecopier No.:  (358) 204 15 0304

with a copy to:

Osler, Hoskin & Harcourt LLP
100 King Street West, Suite 6100
First Canadian Place
Toronto, Ontario  M5X 1B8
Attention:        Dale R. Ponder
Telecopier No.:  (416) 862-6666

White & Case LLP
1155 Avenue of the Americas
New York, New York
10036-2787
Attention:       Timothy B. Goodell
Telecopier No.:  (212) 354-8113

TD Asset Management Inc.
10th Floor, P.O. Box 1
TD Bank Tower
Toronto, Canada   M5K 1A2
Attention:       Rob MacLellan
Telecopier No.:  (416) 983-5550

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