Document:

Exhibit 10.56

  Exhibit 10.56
 EXECUTION COPY
 TENTH AMENDMENT AND WAIVER  
             This Tenth Amendment and Waiver (the "Agreement") to the Credit Agreement referred to below is dated as of November 12, 2008 and effective in accordance with Section 4 below, by and among BOWATER CANADIAN FOREST
PRODUCTS INC., a company organized under the laws of Canada, in its capacity as Borrower under the Credit Agreement referred to below (the "Borrower"), BOWATER INCORPORATED, a corporation organized under the laws of Delaware ("BI"),
BOWATER ALABAMA LLC (formerly known as Bowater Alabama Inc.), a limited liability company organized under the laws of Alabama ("BA"), BOWATER NEWSPRINT SOUTH LLC, a limited liability company organized under
the laws of Delaware ("BNS"), BOWATER NEWSPRINT SOUTH OPERATIONS LLC (formerly known as Bowater Newsprint South Inc.), a limited liability company organized under the laws of Delaware and the successor by merger to Bowater Mississippi LLC
("BNSO"), each in its capacity as a Guarantor under the Credit Agreement referred to below (BI, BA, BNS and BNSO are collectively referred to herein as the "U.S. Borrower"), certain Subsidiaries and Affiliates of the Borrower party
hereto (the "Grantors"), ABITIBIBOWATER INC., a corporation organized under the laws of Delaware (the "Parent"), the Lenders and the U.S. Lenders party hereto (collectively, the "Consenting Lenders") pursuant to an authorization
(in the form attached hereto as Exhibit A, each a "Lender Authorization") and THE BANK OF NOVA SCOTIA, as administrative agent (the "Administrative Agent") for the Lenders party to the Credit Agreement referred to below.
 
 STATEMENT OF PURPOSE: 
             The Borrower, the U.S. Borrower, the Lenders, certain other financial
institutions and the Administrative Agent are parties to the Credit Agreement dated as of May 31, 2006 (as amended by that certain First Amendment dated as of July 20, 2007, that certain Second Amendment dated as of October 31, 2007, that certain
Third Amendment and Waiver dated as of February 25, 2008, that certain Fourth Amendment dated as of March 31, 2008, that certain Fifth Amendment dated as of April 30, 2008, that certain Sixth Amendment dated as of May 28, 2008, that certain Seventh
Amendment dated as of June 6, 2008, that certain Eighth Amendment dated as of June 30, 2008, that certain Ninth Amendment and Waiver dated as of August 7, 2008, as amended hereby and as further amended, restated, supplemented or otherwise modified
from time to time, the "Credit Agreement").   
 The Borrower has requested that the Administrative Agent, the Lenders and the
U.S. Lenders agree to amend the Credit Agreement as more specifically set forth herein.  In addition, the Borrower (a) has (i) failed to deliver the monthly borrowing base certificate as required pursuant to Section 7.1(g) of the Credit
Agreement for the months ended June 30, 2008, July 31, 2008, August 31, 2008 and September 30, 2008 (the "Delivery Requirements") and (ii) failed to promptly notify the Administrative Agent of such failure, (b) has failed to comply with the
financial covenants set forth in Sections 9.1 and 9.2 of the Credit Agreement with respect to the testing period ended September 30, 2008 and (c) hereby requests that the Administrative Agent, the Lenders and the U.S. Lenders agree to
waive all Defaults and Events of Default related to the foregoing.  Subject to the terms and conditions set forth herein, the Administrative Agent and each of the Consenting Lenders have agreed to grant such requests of the Borrower.

             NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 
                 1.                   Capitalized Terms.  Except as
otherwise provided herein, all capitalized undefined terms used in this Agreement (including, without limitation, in the introductory paragraph and the statement of purpose hereto) shall have the meanings assigned thereto in the Credit Agreement (as
amended by this Agreement).  
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                 2.
                  Credit Agreement Amendments.  The Credit Agreement (including Exhibits B and K
thereto but excluding all other Exhibits and Schedules thereto) is hereby amended as set forth on Exhibit B.  It is hereby acknowledged by the parties hereto that the amended Credit Agreement as set forth on Exhibit B reflects the
permanent reduction by the Borrower of the Commitment from $143,750,000 to $141,177,293 pursuant to Section 2.5(a) of the Credit Agreement (the Consenting Lenders hereby waiving the minimum amount requirement of such Section).

                 3.
                  Waivers.  Pursuant to Section 14.2 of the Credit Agreement and subject to the terms and
conditions hereof, including, without limitation, the conditions to effectiveness set forth in Section 4 hereof, the Administrative Agent, the Issuing Lender and the other Consenting Lenders party hereto waive any and all Defaults and Events
of Default occurring pursuant to (a) Section 12.1(d), Section 12.1(e) and/or Section 12.1(g)(i) of the Credit Agreement, in each case, solely as a result of the failure by the Borrower and the U.S. Borrower to comply with the
Delivery Requirements and to provide notice of such failure to the Administrative Agent and (b) Section 12.1(d) and Section 12.1(g)(i) of the Credit Agreement, in each case, solely as a result of the failure by the U.S. Borrower and
its Subsidiaries to comply with the financial covenants set forth in Sections 9.1 and 9.2 of the Credit Agreement and Sections 9.1 and 9.2 of the U.S. Credit Agreement, in each case, solely with respect to the testing
period ended September 30, 2008. 
                
4.                   Conditions to Effectiveness.  Upon the satisfaction of each of the following conditions,
this Agreement shall be deemed to be effective as of the date hereof: 
                (a)                 the Administrative Agent shall have received counterparts of
this Agreement executed by the Administrative Agent (on behalf of itself and each of the Consenting Lenders by virtue of each Consenting Lender's execution of a Lender Authorization), the Parent, the Borrower, the U.S. Borrower and each of the
Grantors; 
                 (b)
                the Administrative Agent shall have received executed Lender Authorizations from the requisite Consenting Lenders; 
                 (c)
                the Administrative Agent shall have been reimbursed for all fees and out-of-pocket charges and other expenses incurred in connection with this Agreement,
including, without limitation, the reasonable fees and disbursements of counsel for the Administrative Agent; 
                 (d)                 the Administrative Agent shall have received an
effective corresponding amendment to the U.S. Credit Agreement, in form and substance substantially consistent with this Agreement (with such changes as are applicable only to the U.S. Credit Agreement), duly executed by the U.S. Administrative
Agent, the U.S. Borrower, the Parent, each U.S. Guarantor and the requisite Consenting Lenders (whether directly or through a lender authorization); 
                 (e)                 the Administrative Agent shall
have received evidence in form and substance satisfactory thereto that Consolidated EBITDA for the fiscal quarter ended September 30, 2008 is not less than $78,500,000; 
                 (f)
                the U.S. Borrower shall have paid to the U.S. Administrative Agent (or its applicable affiliates), for the account of each Consenting Lender (including the
Administrative Agent and the U.S. Administrative Agent) that executes and delivers this Agreement or a Lender Authorization to the U.S. Administrative Agent (or its counsel) on or prior to 5:00 p.m. (Eastern Time) on November 13, 2008, an amendment
fee in an amount equal to (a) 50 basis points times the principal amount of such Consenting Lender's Commitment plus (b) 50 basis points times the principal amount of such Consenting Lender's "Commitment" (as defined in the U.S.
Credit Agreement); 
  
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(g)                 the Administrative Agent and the Lenders shall have been repaid in full all commitment fees due thereto under the Credit Agreement that have accrued on
and prior to the date of this Agreement with respect to that portion of the Commitment terminated as of the date hereof; 
                 (h)                 the Borrower shall have made a repayment of principal
sufficient to permanently reduce the aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C Obligations, as applicable, to the Commitment as reduced as of the date of this Agreement and shall otherwise have complied with the
requirements of the Credit Agreement with respect to reduction of the Commitment; 
                 (i)                  the Borrower shall have used its commercially
reasonable efforts to deliver endorsements with respect to the Credit Insurance Policy in form and substance reasonably acceptable to the Administrative Agent and the U.S. Administrative Agent reflecting their respective interests as additional
insured and loss payee, as their respective interest may appear; 
                 (j)                  the Administrative Agent shall have received a
bring-down field exam dated as of September 30, 2008 with respect to the Collateral in form and substance satisfactory to the Administrative Agent (it being hereby agreed and acknowledged that receipt of the Borrowing Base Certificate pursuant to
clause (k) below shall be deemed to satisfy the requirement set forth in this clause (j)); 
                 (k)                 the Administrative Agent shall have received a Borrowing
Base Certificate, in form and substance satisfactory to the Administrative Agent dated as of September 30, 2008, duly certified by a Responsible Officer of the Borrower; 
                 (l)
                  the Administrative Agent shall have received documentation, in form and substance satisfactory to the Administrative Agent and the U.S.
Administrative Agent, evidencing, amongst other things, an increase in the credit limit (on terms and conditions satisfactory to the Administrative Agent and the U.S. Administrative Agent) with respect to the U.S. Borrower and its Subsidiaries'
existing foreign accounts receivable credit insurance policy number GE 1 16357 with Export Development Canada (the "Closing Date Credit Insurance Policy"); and 
                 (m)                 the Administrative Agent shall have
received such other instruments (including, without limitation, amended and restated Revolving Credit Notes (if requested by the Lenders) reflecting the reduction in the Commitment), documents and certificates as the Administrative Agent shall
reasonably request in connection with the execution of this Agreement . 
                  5.                    Post-Closing Agreements.  
                 (a)                 As promptly as possible, but no later than November
26, 2008, to the extent not delivered on the date of this Agreement after the U.S. Borrower's use of commercially reasonable efforts, the Administrative Agent shall have received endorsements with respect to the Closing Date Credit Insurance Policy
in form and substance reasonably acceptable to the Administrative Agent and the U.S. Administrative Agent reflecting their respective interests as additional insured and loss payee, as their respective interests may appear. 
                
(b)                  As promptly as possible, but no later than December 8, 2008, the Administrative Agent shall have received a duly executed perfection
certificate for the Credit Parties dated as of the date of its delivery in form and substance satisfactory to the Administrative Agent. 
                  (c)                  As soon as possible but in any event by
December 31, 2008, the U.S. Borrower hereby agrees that it shall provide the following: 
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                                        (i)
                (A) duly executed amendments to each of the New U.S. Borrower Mortgages, in each case, in form and substance satisfactory to the Administrative Agent but
including, without limitation, an amendment to the legal descriptions set forth therein (to the extent necessary) (collectively, the "New U.S. Borrower Mortgage Amendments") and (B) down-dated title policies with respect to each of the
Coosa Pines Mill Real Property and Grenada Mill Real Property dated as of the date of the applicable amendment referred to in clause (A) insuring the Lien of each of the New U.S. Borrower Mortgages, as amended by each of the New U.S. Borrower
Mortgage Amendments, and otherwise in form and substance satisfactory to the Administrative Agent;  and 
                                        
(ii)                an updated Schedule 1.1(c) to the Credit Agreement dated as of the date on which the New U.S. Borrower Mortgage Amendments are filed. 

(d)                 As promptly as
possible, but no later than December 12, 2008 (as such date may be extended by the Administrative Agent and the U.S. Administrative Agent in their sole discretion), the Administrative Agent and the U.S. Administrative Agent shall have received (i) a
Credit Insurance Policy covering the U.S. Borrower and its Subsidiaries or the Parent and each of its subsidiaries (including the U.S. Borrower and its Subsidiaries) issued by Export Development Canada or another insurer reasonably acceptable to the
Administrative Agent and the U.S. Administrative Agent, covering each account debtor of the U.S. Borrower and its Subsidiaries whose chief executive office is not located in the United States or Canada (except as otherwise approved by the
Administrative Agent and the U.S. Administrative Agent) and otherwise on substantially the same terms and conditions as those set forth in the Closing Date Credit Insurance Policy or on such other terms and conditions as are reasonably acceptable to
the Administrative Agent and the U.S. Administrative Agent and (ii) endorsements with respect to the Credit Insurance Policy described in the foregoing clause (i) in form and substance reasonably acceptable to the Administrative Agent and the
U.S. Administrative Agent reflecting their respective interests as additional insured and loss payee, as their respective interests may appear (it being understood and agreed that any endorsement that is the same form and substance as the
endorsement accepted by the Administrative Agent and the U.S. Administrative Agent in satisfaction of the requirements in clause (a) of this Section shall be acceptable to the Administrative Agent and the U.S. Administrative Agent).

 It is hereby agreed and acknowledged that if any item described in clause (a), (b) or (d) above is not
delivered on the date required thereby, such failure shall be deemed to be an immediate Event of Default under Section 12.1(d) of the Credit Agreement. 
                 6.
                  Effect of the Agreement .  Except as expressly provided herein, the Credit Agreement and the
other Loan Documents shall remain unmodified and in full force and effect.  Except as expressly set forth herein, this Agreement shall not be deemed (a) to be a waiver of, or consent to, a modification of or amendment of, any other term or
condition of the Credit Agreement or any other Loan Document, (b) to prejudice any other right or rights which the Administrative Agent or the Lenders may now have or may have in the future under or in connection with the Credit Agreement or the
other Loan Documents or any of the instruments or agreements referred to therein, as the same may be amended, restated, supplemented or otherwise modified from time to time, (c) to be a commitment or any other undertaking or expression of any
willingness to engage in any further discussion with the Borrower or any other Person with respect to any waiver, amendment, modification or any other change to the Credit Agreement or the Loan Documents or any rights or remedies arising in favor of
the Lenders or the Administrative Agent, or any of them, under or with respect to any such documents or (d) to be a waiver of, or consent to or a modification or amendment of, any other term or condition of any other agreement by and among the
Borrower, on the one hand, and the Administrative Agent or any other Lender, on the other hand.  References in the Credit Agreement to "this Agreement" (and indirect references such as "hereunder", "hereby", "herein", and "hereof") and in any
Loan Document to the Credit Agreement shall be deemed to be references to the Credit Agreement as modified hereby. 
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                  7.                   Representations and Warranties/No Default .  By their execution hereof, 
                
(a)                  the Parent, the Borrower, the U.S. Borrower and each of the Grantors hereby certifies, represents and warrants to the Administrative Agent and
the Lenders that after giving effect to the amendments set forth in Section 2 above and the waivers set forth in Section 3 above, each of the representations and warranties set forth in the Credit Agreement and the other Loan Documents
is true and correct in all material respects as of the date hereof (except to the extent that (A) any such representation or warranty that is qualified by materiality or by reference to Material Adverse Effect, in which case such representation or
warranty is true and correct in all respects as of the date hereof or (B) any such representation or warranty relates only to an earlier date, in which case such representation or warranty shall remain true and correct as of such earlier date) and
that no Default or Event of Default has occurred or is continuing;               
                 (b)               the Parent, the Borrower, the U.S. Borrower and each of the
Grantors hereby certifies, represents and warrants to the Administrative Agent and the Lenders that:          
                                     
(i)         it has the right, power and authority and has taken all necessary corporate and other action to authorize the execution, delivery and performance of this Agreement and each of
the other documents executed in connection herewith to which it is a party in accordance with their respective terms and the transactions contemplated hereby; and 
                                    
(ii)        this Agreement and each other document executed in connection herewith has been duly executed and delivered by the duly authorized officers of the Parent, the Borrower, the U.S. Borrower and each of the
Grantors, and each such document constitutes the legal, valid and binding obligation of the Parent, the Borrower, the U.S. Borrower and each of the Grantors, enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar state or federal debtor relief laws from time to time in effect which affect the enforcement of creditors' rights in general and the availability of equitable remedies. 
                 8.
                  Reaffirmations.  Each Credit Party (a) agrees that the transactions contemplated by this
Agreement shall not limit or diminish the obligations of such Person under, or release such Person from any obligations under, the Credit Agreement, the applicable Guaranty Agreement, the Collateral Agreement and each other Security Document to
which it is a party, (b) confirms and reaffirms its obligations under the Credit Agreement, the applicable Guaranty Agreement, the Collateral Agreement and each other Security Document to which it is a party and (c) agrees that the Credit Agreement,
the applicable Guaranty Agreement, the Collateral Agreement and each other Security Document to which it is a party remain in full force and effect and are hereby ratified and confirmed. 
                 9.                   Governing
Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 
                10.                  Counterparts.  This Agreement may be executed by one or more of the parties hereto in any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument.

                11.                 Electronic Transmission.  A facsimile, telecopy, pdf or other reproduction of this Agreement may be executed by one or more parties hereto, and an executed copy of
this Agreement may be delivered by one or more parties hereto by facsimile or similar instantaneous electronic transmission device pursuant to which the signature of or on behalf of such party can be seen, and such execution and delivery shall be
considered valid, binding and effective for all purposes.  At the request of any party 
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 hereto, all parties hereto agree to execute an original of this Agreement as well as any facsimile, telecopy, pdf or other reproduction hereof. 
 12.       Authorization and Acknowledgement.  Each of the Lenders party hereto hereby (a) authorizes the
U.S. Administrative Agent to execute and deliver the New U.S. Borrower Mortgage Amendments in its capacity as U.S. Administrative Agent by and on behalf of such Lender and (b) acknowledges and authorizes the agreement of the Administrative Agent and
the U.S. Administrative Agent, as applicable, set forth in Section 13 of this Agreement with respect to the Credit Insurance Policy and Section 14 of this Agreement with respect to the New U.S. Borrower Mortgage Amendments. 
  13.      Turnover with respect to Credit Insurance Policy. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, by their execution of this Agreement or the Eighth Amendment to the U.S. Credit Agreement, as applicable, the Administrative Agent and the U.S. Administrative Agent hereby
acknowledge and agree that (a) the Administrative Agent shall have the sole and exclusive right, as against the U.S. Administrative Agent, to adjust settlement of insurance claims with respect to the Collateral covered by the Credit Insurance Policy
and (b) the U.S. Administrative Agent shall have the sole and exclusive right, as against the Administrative Agent, to adjust settlement of insurance claims with respect to the U.S. Collateral covered by the Credit Insurance Policy.  In
furtherance of the foregoing, each of the Administrative Agent and the U.S. Administrative Agent hereby agree that that upon such Person's (the "Actual Recipient") receipt of any proceeds of the Credit Insurance Policy attributable to
collateral of such other Person (the "Rightful Recipient"), the Actual Recipient shall segregate such proceeds and hold such proceeds in trust to be promptly paid over to the Rightful Recipient in the same form as received.  

14.       Sharing Provision in New U.S. Borrower Mortgage Amendments.  The Administrative Agent, the U.S.
Administrative Agent and the U.S. Borrower, on behalf of itself and its Subsidiaries, hereby agree that the New U.S. Borrower Mortgage Amendments shall include an amendment to the "SECOND" paragraph of Section 4.4 thereof to provide that the
proceeds applied pursuant to such paragraph shall be applied as follows: (i) prior to the date upon which each of the Overadvance and the Canadian Overadvance are each reduced to $0 (such date, the "Adjustment Date") (A) to the Administrative
Agent, to be distributed to the Domestic Facility Secured Parties in accordance with the Credit Agreement, in an aggregate amount equal to the product of (1) the U.S. Pro Rata Percentage as of the date hereof times (2) such amount and (B) to
the Canadian Administrative Agent, to be distributed to the Canadian Facility Secured Parties in accordance with the Canadian Credit Agreement, in an aggregate amount equal to the product of (1) the Canadian Pro Rata Percentage as of the date hereof
times (2) such amount and to be further distributed by the Administrative Agent or Canadian Administrative Agent (as applicable) as required pursuant to the terms of the Credit Agreement or the Canadian Credit Agreement (as applicable) and
(ii) on or after the Adjustment Date (A) to the Administrative Agent, to be distributed to the Domestic Facility Secured Parties in accordance with the Credit Agreement, in an aggregate amount equal to the product of (1) the U.S. Pro Rata Percentage
as of the Adjustment Date times (2) such amount and (B) to the Canadian Administrative Agent, to be distributed to the Canadian Facility Secured Parties in accordance with the Canadian Credit Agreement, in an aggregate amount equal to the
product of (1) the Canadian Pro Rata Percentage as of the Adjustment Date times (2) such amount and to be further distributed by the Administrative Agent or Canadian Administrative Agent (as applicable) as required pursuant to the terms of
the Credit Agreement or the Canadian Credit Agreement (as applicable)).  For purposes of this Section, except as set forth herein, all capitalized terms used herein without definition shall have the meanings assigned thereto in the applicable
New Borrower Mortgage.  
   
   
 [Signature Pages Follow]

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   IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date and year first above written.   
  

	 	BORROWER: 
	 	 	 
	 	BOWATER CANADIAN FOREST PRODUCTS INC.
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	Vice President and Treasurer

  
  

	 	U.S. BORROWER: 
	 	 	 
	 	BOWATER INCORPORATED
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	Senior Vice President and Treasurer

  
  

	 	BOWATER ALABAMA LLC
	 	 	 
	 	By: Bowater Newsprint South LLC, its member
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	Manager

                                         
              
  

	 	BOWATER NEWSPRINT SOUTH LLC
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	Manager

  
  

	 	BOWATER NEWSPRINT SOUTH OPERATIONS LLC
	 	 	 
	 	By: Bowater Newsprint South LLC, its manager
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	Manager

  
  [Signature Pages Continue] 
  
  
 
  
  

	 	PARENT: 
	 	 	 
	 	ABITIBIBOWATER INC.
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	Senior Vice President and Chief Financial Officer

   
  

	 	GRANTORS: 
	 	 	 
	 	BOWATER CANADIAN HOLDINGS INCORPORATED
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	Vice President

  
  

	 	BOWATER CANADA FINANCE LIMITED PARTNERSHIP
	 	 	 
	 	By: BOWATER CANADA TREASURY CORPORATION, its general partner
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	President

  
  

	 	BOWATER SHELBURNE CORPORATION
	 	 	 
	 	By:	 /s/ William G. Harvey

	 	Name:	William G. Harvey
	 	Title:	President

  
  

	 	BOWATER LAHAVE CORPORATION
	 	 	 
	 	By:	 /s/ Duane A. Owens

	 	Name:	Duane A. Owens
	 	Title:	Vice President and Treasurer

  
  
 [Signature Pages Continue] 
  
  
 
  
   

	 	THE BANK OF NOVA SCOTIA , as Administrative Agent (on behalf of itself and the Consenting Lenders who have executed a Lender Authorization) and as
Issuing Lender and Lender 
	 	 	 
	 	By:	 /s/ Stella Luna

	 	Name:	Stella Luna
	 	Title:	Associate Director

  
  
  
 
 
   Exhibit A 
 Form of Lender Authorization 

   
  
 LENDER AUTHORIZATION 

 Bowater Incorporated and New Borrowers 
 Bowater Canadian Forest Products Inc. 
 Eighth Amendment and Waiver to U.S. Credit Agreement 
 Tenth Amendment and Waiver to Canadian Credit Agreement   
 November 12, 2008 
   
 Wachovia Bank, National Association 
 NC0680 
 1525 West W.T. Harris Blvd. 
 Charlotte, North Carolina
28262 
 Attention:  Syndication Agency Services 
  
 The Bank of Nova Scotia 
 40 King Street West 
 Scotia Plaza,
62nd Floor 
 Toronto, Ontario  M5W 2X6 
 Attention: Corporate Banking Loan Syndication 
  
  
                 Re:          (a) The Eighth Amendment and Waiver dated as of November 12, 2008 (the "U.S.
Agreement") to that certain Credit Agreement dated as of May 31, 2006 (as amended, the "U.S. Credit Agreement") among Bowater Incorporated and the New Borrowers party thereto (collectively, the "U.S. Borrower"), the lenders party
thereto (the "U.S. Lenders"), and Wachovia Bank, National Association, as administrative agent (the "U.S. Administrative Agent") for the U.S. Lenders and (b) the Tenth Amendment and Waiver dated as of November 12, 2008 (the
"Canadian Agreement" and, together with the U.S. Agreement, the "Agreements") to that certain Credit Agreement dated as of May 31, 2006 (as amended, the "Canadian Credit Agreement") among Bowater Canadian Forest Products Inc.
(the "Canadian Borrower"), the U.S. Borrower, the lenders party thereto (the "Canadian Lenders"), and The Bank of Nova Scotia, as administrative agent (the "Canadian Administrative Agent") for the Canadian Lenders. 

This Lender Authorization acknowledges our receipt and review of the execution copy of the Agreements, each in the form posted on SyndTrak Online or otherwise
distributed to us by the U.S. Administrative Agent or the Canadian Administrative Agent.  By executing this Lender Authorization, we hereby approve the Agreements and authorize the U.S. Administrative Agent or the Canadian Administrative Agent
(as applicable) to execute and deliver the Agreements on our behalf.  
 Each financial institution purporting to be a U.S. Lender
and executing this Lender Authorization agrees or reaffirms that it shall be a party to the Agreements and the other Loan Documents (as defined in the U.S. Credit Agreement) to which U.S. Lenders are parties and shall have the rights and obligations
of a "Lender" (as defined in the U.S. Credit Agreement), and agrees to be bound by the terms and provisions applicable to a "Lender" under each such agreement.  Each financial institution purporting to be a Canadian Lender and executing this
Lender Authorization agrees or reaffirms that it shall be a party to the Agreements and the other Loan Documents (as defined in the Canadian Credit Agreement) to which Canadian Lenders are parties and shall have the rights and obligations of a
"Lender" (as defined in the Canadian Credit Agreement), and agrees to be bound by the terms and provisions applicable to a "Lender" under each such agreement.  In furtherance of the foregoing, each financial institution executing
  
 
  
 this
Lender Authorization agrees to execute any additional documents reasonably requested by the U.S. Administrative Agent or the Canadian Administrative Agent, as applicable, to evidence such financial institution's rights and obligations under the U.S.
Credit Agreement or the Canadian Credit Agreement, as applicable.   
 A facsimile, telecopy, pdf or other reproduction of this
Lender Authorization may be executed by one or more parties hereto, and an executed copy of this Lender Authorization may be delivered by one or more parties hereto by facsimile or similar instantaneous electronic transmission device pursuant to
which the signature of or on behalf of such party can be seen, and such execution and delivery shall be considered valid, binding and effective for all purposes.  
   

	 	 	 [Insert name of applicable financial institution]

	 	 	 
	 	 	 
	 	By:	  

	 	Name:	 

	 	Title:	 

                                           
                
 
 
    Exhibit B 
 Credit Agreement

   
 
  
 
 
	  

 CREDIT
AGREEMENT
 dated as of May 31, 2006
 (as amended by that certain
First Amendment dated as of July 20, 2007,
 that certain Second Amendment dated as of October 31, 2007,
 that certain Third Amendment and Waiver dated as of February 25, 2008,
 that
certain Fourth Amendment dated as of March 31, 2008, that certain Fifth Amendment dated as of April 30, 2008, that certain Sixth Amendment dated as of May 28, 2008,
 that certain Seventh Amendment dated as of June 6, 2008,
 that certain Eighth
Amendment dated as of June 30, 2008,
 that certain Ninth Amendment and Waiver dated as of August 7, 2008 and
 that certain Tenth Amendment and Waiver dated as of November 12, 2008)
  
 by and among
 BOWATER CANADIAN FOREST PRODUCTS INC.,

 as Borrower,
 BOWATER INCORPORATED,

 BOWATER ALABAMA LLC,
 BOWATER NEWSPRINT SOUTH
LLC, and
 BOWATER NEWSPRINT SOUTH OPERATIONS LLC,
 as Guarantor,
 the Lenders referred to herein,
 THE BANK OF NOVA SCOTIA,
 as Administrative
Agent
 and Issuing Lender,
 BANK OF MONTREAL,
 as Syndication Agent and Swingline Lender,
 and
 WACHOVIA BANK, NATIONAL ASSOCIATION,
 as
Documentation Agent
 WACHOVIA CAPITAL MARKETS, LLC,
 as Sole
Book Manager
 WACHOVIA CAPITAL MARKETS, LLC,
 as Lead
Arranger
 
	  

  
  
 
  
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 TABLE OF CONTENTS
 Page
  
 
	 ARTICLE I DEFINITIONS
	 1

	 SECTION 1.1
	 Definitions
	 1

	 SECTION 1.2
	 Other Definitions and Provisions
	 47

	 SECTION 1.3
	 Accounting Terms
	 48

	 SECTION 1.4
	 PPSA and CCQ Terms
	 48

	 SECTION 1.5
	 Rounding
	 48

	 SECTION 1.6
	 References to Agreement and Laws
	 48

	 SECTION 1.7
	 Times of Day
	 49

	 SECTION 1.8
	 Letter of Credit Amounts
	 49

	 SECTION 1.9
	 Amount of Obligations
	 49

	  
	  
	  

	 ARTICLE II REVOLVING CREDIT FACILITY
	 49

	 SECTION 2.1
	 Revolving Credit Loans
	 49

	 SECTION 2.2
	 Swingline Loans
	 49

	 SECTION 2.3
	 Procedure for Advances of Revolving Credit Loans and Swingline Loans

	 51

	 SECTION 2.4
	 Repayment and Prepayment of Revolving Credit Loans and Swingline Loans

	 53

	 SECTION 2.5
	 Permanent Reduction of the Commitment
	 55

	 SECTION 2.6
	 Termination of Credit Facility
	 56

	 SECTION 2.7
	 Terms Applicable to BA Loans
	 58

	  
	  
	  

	 ARTICLE III LETTER OF CREDIT FACILITY
	 63

	 SECTION 3.1
	 L/C Commitment
	 63

	 SECTION 3.2
	 Procedure for Issuance of Letters of Credit
	 63

	 SECTION 3.3
	 Commissions and Other Charges
	 64

	 SECTION 3.4
	 L/C Participations
	 65

	 SECTION 3.5
	 Reimbursement Obligation of the Borrower
	 66

	 SECTION 3.6
	 Obligations Absolute
	 66

	 SECTION 3.7
	 Effect of Letter of Credit Application
	 67

	  
	  
	  

	 ARTICLE IV GENERAL LOAN PROVISIONS
	 67

	 SECTION 4.1
	 Interest
	 67

	 SECTION 4.2
	 Notice and Manner of Conversion or Continuation of Loans
	 70

	 SECTION 4.3
	 Fees
	 71

	 SECTION 4.4
	 Manner of Payment
	 72

	 SECTION 4.5
	 Evidence of Indebtedness
	 73

	 SECTION 4.6
	 Adjustments
	 73

	 SECTION 4.7
	 Nature of Obligations of Lenders Regarding
Extensions of Credit; Assumption by the Administrative Agent
	 76

	 SECTION 4.8
	 Changed Circumstances.
	 77

	 SECTION 4.9
	 Indemnity
	 78

	 SECTION 4.10
	 Increased Costs
	 79

	 SECTION 4.11
	 Taxes
	 80

	 SECTION 4.12
	 Mitigation Obligations; Replacement of Lenders
	 82

	 SECTION 4.13
	 Security
	 83

	 SECTION 4.14
	 Additional Subsidiary Borrowers
	 83

	  
	  
	  

  
 
  
 i
  
 

  
  
 
  
 -

  
 
	 ARTICLE V CLOSING; CONDITIONS OF CLOSING AND
BORROWING
	 85

	 SECTION 5.1
	 Closing
	 85

	 SECTION 5.2
	 Conditions to Closing and Initial Extensions of Credit
	 85

	 SECTION 5.3
	 Conditions to All Extensions of Credit
	 88

	 SECTION 5.4
	 Post-Closing Conditions
	 89

	  
	  
	  

	 ARTICLE VI REPRESENTATIONS AND WARRANTIES OF THE
BORROWER
	 90

	 SECTION 6.1
	 Representations and Warranties
	 90

	 SECTION 6.2
	 Survival of Representations and Warranties, Etc
	 97

	  
	  
	  

	 ARTICLE VII FINANCIAL INFORMATION AND NOTICES
	 98

	 SECTION 7.1
	 Financial Statements and Projections
	 98

	 SECTION 7.2
	 Officer's Compliance Certificate
	 103

	 SECTION 7.3
	 Accountants' Certificate
	 103

	 SECTION 7.4
	 Other Reports
	 103

	 SECTION 7.5
	 Notice of Litigation and Other Matters
	 103

	 SECTION 7.6
	 Accuracy of Information
	 105

	  
	  
	  

	 ARTICLE VIII AFFIRMATIVE COVENANTS
	 105

	 SECTION 8.1
	 Preservation of Corporate Existence and Related Matters
	 105

	 SECTION 8.2
	 Maintenance of Property; Commitment Reductions
	 105

	 SECTION 8.3
	 Insurance
	 110

	 SECTION 8.4
	 Accounting Methods and Financial Records
	 111

	 SECTION 8.5
	 Payment of Taxes
	 111

	 SECTION 8.6
	 Compliance With Laws and Approvals
	 111

	 SECTION 8.7
	 Environmental Laws
	 111

	 SECTION 8.8
	 Compliance with ERISA
	 112

	 SECTION 8.9
	 Visits and Inspections; Consultant Matter
	 112

	 SECTION 8.10
	 Additional Guarantors
	 112

	 SECTION 8.11
	 Use of Proceeds
	 121

	 SECTION 8.12
	 Further Assurances
	 121

	 SECTION 8.13
	 Maximum Cash Balances
	 121

	 SECTION 8.14
	 Credit Insurance Policy
	 121

	  
	  
	  

	 ARTICLE   IX FINANCIAL COVENANTS
	 122

	 SECTION 9.1
	 Consolidated Senior Secured Leverage Ratio
	 122

	 SECTION 9.2
	 Interest Coverage Ratio
	 122

	  
	  
	  

	 ARTICLE X NEGATIVE COVENANTS
	 123

	 SECTION 10.1
	 Limitations on Indebtedness
	 123

	 SECTION 10.2
	 Limitations on Liens
	 127

	 SECTION 10.3
	 Limitations on Loans, Advances, Investments and
Acquisitions
	 128

	 SECTION 10.4
	 Limitations on Mergers and Liquidation
	 129

	 SECTION 10.5
	 Limitations on Asset Dispositions
	 130

	 SECTION 10.6
	 Limitations on Dividends and Distributions
	 131

	 SECTION 10.7
	 Limitations on Exchange and Issuance of
Capital Stock
	 132

	 SECTION 10.8
	 Transactions with Affiliates
	 133

	 SECTION 10.9
	 Certain Accounting Changes; Organizational Documents
	 133

	 SECTION 10.10
	 Amendments; Payments and Prepayments of Indebtedness
	 133

	 SECTION 10.11
	 Restrictive Agreements
	 135

	 SECTION 10.12
	 Nature of Business
	 135

	 SECTION 10.13
	 Impairment of Security Interests
	 135

  
  
  
 ii
  
 

  
  
 
  
 -

  
 
	 SECTION 10.14
	 Maximum Cash Balances
	 136

	  
	  
	  

	 ARTICLE XI UNCONDITIONAL U.S. BORROWER GUARANTY
	 136

	 SECTION 11.1
	 Guaranty of Obligations
	 136

	 SECTION 11.2
	 Nature of Guaranty
	 136

	 SECTION 11.3
	 Waivers
	 137

	 SECTION 11.4
	 Modification of Loan Documents, Etc
	 138

	 SECTION 11.5
	 Demand by the Administrative Agent.
	 139

	 SECTION 11.6
	 Termination; Reinstatement
	 139

	 SECTION 11.7
	 No Subrogation
	 140

	 SECTION 11.8
	 Payments
	 140

	 SECTION 11.9
	 Nature of Obligations; Bankruptcy
Limitations; Agreement for Contribution
	 140

	  
	  
	  

	 ARTICLE XII DEFAULT AND REMEDIES
	 143

	 SECTION 12.1
	 Events of Default
	 143

	 SECTION 12.2
	 Remedies
	 148

	 SECTION 12.3
	 Rights and Remedies Cumulative; Non-Waiver; et
	 149

	 SECTION 12.4
	 Crediting of Payments and Proceeds
	 149

	 SECTION 12.5
	 Administrative Agent May File Proofs of Claim
	 150

	 SECTION 12.6
	 Judgment Currency
	 151

	  
	  
	  

	 ARTICLE XIII THE ADMINISTRATIVE AGENT
	 151

	 SECTION 13.1
	 Appointment and Authority
	 151

	 SECTION 13.2
	 Rights as a Lender
	 152

	 SECTION 13.3
	 Exculpatory Provisions
	 152

	 SECTION 13.4
	 Reliance by the Administrative Agent
	 153

	 SECTION 13.5
	 Delegation of Duties
	 154

	 SECTION 13.6
	 Resignation of Administrative Agent
	 154

	 SECTION 13.7
	 Non-Reliance on Administrative Agent and Other Lenders
	 155

	 SECTION 13.8
	 No Other Duties, etc; Documentation Agent
	 155

	 SECTION 13.9
	 Collateral and Guaranty Matters
	 156

	 SECTION 13.10
	 Swingline Lender
	 156

	 SECTION 13.11
	 Additional Loans
	 157

	 SECTION 13.12
	 Special Agent Advances
	 158

	  
	  
	  

	 ARTICLE XIV MISCELLANEOUS
	 159

	 SECTION 14.1
	 Notices
	 159

	 SECTION 14.2
	 Amendments, Waivers and Consents
	 160

	 SECTION 14.3
	 Expenses; Indemnity
	 162

	 SECTION 14.4
	 Right of Setoff
	 164

	 SECTION 14.5
	 Governing Law
	 165

	 SECTION 14.6
	 Waiver of Jury Trial
	 165

	 SECTION 14.7
	 Reversal of Payments
	 166

	 SECTION 14.8
	 Injunctive Relief; Punitive Damages
	 166

	 SECTION 14.9
	 Accounting Matters
	 166

	 SECTION 14.10
	 Successors and Assigns; Participations
	 166

	 SECTION 14.11
	 Confidentiality
	 169

	 SECTION 14.12
	 Performance of Duties
	 170

	 SECTION 14.13
	 All Powers Coupled with Interest
	 170

	 SECTION 14.14
	 Survival of Indemnities
	 170

				

  
  
  
 iii
  
 

  
  
 
  
 -

  
 
	 SECTION 14.15
	 Titles and Captions
	 170

	 SECTION 14.16
	 Severability of Provisions
	 170

	 SECTION 14.17
	 Counterparts
	 170

	 SECTION 14.18
	 Integration
	 171

	 SECTION 14.19
	 Term of Agreement
	 171

	 SECTION 14.20
	 No Fiduciary Duty
	 171

	 SECTION 14.21
	 Advice of Counsel, No Strict Construction
	 171

	 SECTION 14.22
	 USA Patriot Act
	 172

	 SECTION 14.23
	 Inconsistencies with Other Documents; Independent Effect of Covenants

	 172

	 SECTION 14.24
	 No Novation
	 172

	  
	  
	  

  
  
  
 iv
  
 

  
  
 
  
 -

 EXHIBITS
 
	 Exhibit A-1
	 -
	 Form of Revolving Credit Note

 
	 Exhibit A-2
	 -
	 Form of Swingline Note

 
	 Exhibit B
	 -
	 Form of Notice of Borrowing

 
	 Exhibit C
	 -
	 Form of Notice of Account Designation

 
	 Exhibit D
	 -
	 Form of Notice of Prepayment

 
	 Exhibit E
	 -
	 Form of Notice of Conversion/Continuation

 
	 Exhibit F
	 -
	 Form of Officer's Compliance Certificate

 
	 Exhibit G
	 -
	 Form of Assignment and Assumption

 
	 Exhibit H
	 -
	 Form of Subsidiary Guaranty Agreement

 
	 Exhibit I
	 -
	 Form of Collateral Agreement

 
	 Exhibit J
	 -
	 Form of Intercompany Subordination Agreement

	Exhibit K	-	 Form of Borrowing Base Certificate

 

SCHEDULES
 
	 Schedule 1.1(a)
	 -
	 Existing Letters of Credit

 
	 Schedule 1.1(b)
	 -
	 Specified Existing Notes

 
	 Schedule 1.1(c)
	 -
	 Description of New U.S. Borrower Real Property

 

	 Schedule 6.1(b)
	 -
	 Subsidiaries and Capitalization

 
	 Schedule 6.1(i-1)
	 -
	 ERISA Plans

 
	 Schedule 6.1(i-2)
	 -
	 Canadian Plans

 
	 Schedule 6.1(l)
	 -
	 Significant Indebtedness

 
	 Schedule 6.1(n)
	 -
	 Burdensome Provisions

 
	 Schedule 6.1(t)
	 -
	 Litigation

 
	 Schedule 10.1
	 -
	 Permitted Indebtedness

 
	 Schedule 10.2
	 -
	 Existing Liens

 
	 Schedule 10.3
	 -
	 Existing Loans, Advances and Investments

 
	 Schedule 10.8
	 -
	 Transactions with Affiliates

  
  
  
 v
  
 

  
  
 

 CREDIT AGREEMENT, dated as of May 31, 2006, by and among BOWATER CANADIAN FOREST PRODUCTS INC., a Canadian corporation (the "Borrower"), together with each additional borrower that becomes a party hereto pursuant to the terms hereof, as Borrower, BOWATER INCORPORATED, a Delaware corporation (the "Original U.S. Borrower
"), BOWATER ALABAMA LLC (formerly known as Bowater Alabama, Inc.), an Alabama limited liability company (the "Coosa Pines Borrower"), BOWATER NEWSPRINT SOUTH LLC, a Delaware
limited liability company ("BNS Holdings") and BOWATER NEWSPRINT SOUTH OPERATIONS LLC (formerly known as Bowater Newsprint South, Inc.), a Delaware limited liability company and the successor by merger
to Bowater Mississippi, LLC (the "Grenada Borrower" and, collectively with the Coosa Pines Borrower and BNS Holdings, the "New U.S. Borrowers"), together
with each additional guarantor that becomes a party hereto pursuant to the terms hereof, as Guarantors, the lenders who are party to this Agreement or who may become a party to this Agreement pursuant to Section 14.10 hereof, as Lenders, and THE
BANK OF NOVA SCOTIA, as Administrative Agent for the Lenders.
 STATEMENT OF PURPOSE
 The Borrower has requested, and the Lenders have agreed, to extend certain credit facilities to the Borrower on the terms and conditions of this
Agreement.
 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the
parties hereto, such parties hereby agree as follows:
 ARTICLE I
  
 DEFINITIONS
 SECTION 1.1    
Definitions. The following terms when used in this Agreement shall have the meanings assigned to them below:
 "Abitibi" means Abitibi-Consolidated Inc.
 "Abitibi Entities" means, collectively, Abitibi and its Subsidiaries.
 "Accounts" has the meaning
specified in Section 1.1 of the Collateral Agreement.
 "Administrative Agent" means The Bank of Nova Scotia, in its capacity as Administrative Agent hereunder, and any successor thereto appointed pursuant to Section 13.6.
 "Administrative Agent's Office" means the office of the Administrative Agent specified in or determined
in accordance with the provisions of Section 14.1(c).
 "Administrative Questionnaire"
means an Administrative Questionnaire in a form supplied by the Administrative Agent.
 "Affiliate" means, with respect to any Person, any other Person which directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such first Person or any of its Subsidiaries. As used in
this definition, the term
  
  
 
  
 -

 "control" means (a) the power to vote ten percent (10%) or more of the securities or other equity interests of a Person having ordinary voting power (excluding,
however, a Person or group whose ownership in another Person is permitted to be reported on Schedule 13G pursuant to Rule 13d-1(b) under the Securities Exchange Act of 1934, as amended) or (b) the possession, directly or indirectly, of any
other power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. Notwithstanding the foregoing, (i) no individual shall be an Affiliate of the U.S.
Borrower or any of its Subsidiaries solely and exclusively by reason of his or her being a director, officer or employee of the U.S. Borrower or any of its Subsidiaries, (ii) none of the Subsidiaries of the U.S. Borrower shall be Affiliates of the
U.S. Borrower or any of its Subsidiaries and (iii) no U.S.
 Borrower shall be an Affiliate of any other U.S. Borrower; provided that the Abitibi Entities shall be Affiliates of the U.S. Borrower and its Subsidiaries for the purposes of this Agreement and the other Loan Documents and the U.S. Credit Agreement and the "Loan Documents"
(as defined in the U.S. Credit Agreement).
 "Aggregate Credit Exposure" means the sum of
(a) the aggregate amount of outstanding Loans, (b) the Swingline Commitment and (c) the aggregate amount of outstanding U.S. Loans.
 "
Agreement" means this Credit Agreement, as amended by (a) the First Amendment dated as of July 20, 2007 by and among the Borrower, the Guarantors and the Administrative Agent (on behalf of itself and
the Lenders party thereto), (b) the Second Amendment dated as of October 31, 2007 by and among the Borrower, the Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto), (c) the Third Amendment, (d) the Fourth
Amendment, (e) the Fifth Amendment, (f) the Sixth Amendment, (g) the Seventh Amendment, (h) the Eighth Amendment, (i) the Ninth Amendment, (j) the Tenth Amendment and as further amended, restated, supplemented or otherwise modified from time to
time.
 "Applicable Insolvency Laws" means all Applicable Laws governing bankruptcy,
reorganization, arrangement, adjustment of debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C. Sections 544, 547, 548 and 550 and other "avoidance"
provisions of Title 11 of the United States Code, as amended or supplemented, the Bankruptcy and Insolvency Act (Canada), as amended or supplemented, the Companies' Creditors Arrangement Act (Canada), as amended or supplemented, and the
CCQ).
 "Applicable Law" means all applicable provisions of constitutions, laws, statutes,
ordinances, rules, treaties, regulations, permits, licenses, approvals, legally binding policies, interpretations and orders of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators.
 "Applicable Margin" means the corresponding percentages per annum as set forth below based on the
Average Utilization:
  
  
 2
  
 

  
  
 
  
 -

 
 
	 Pricing Level
	 Average Utilization Percentage
	 LIBOR +
	 Canadian Prime Rate or Base Rate +

	 I
	 Greater than 75%
	 4.50%
	 3.50%

	 II
	 Greater than 35%, but less than or equal to 75%
	 4.25%
	 3.25%

	 III
	 Less than or equal to 35%
	 4.00%
	 3.00%

  
 The Applicable Margin shall be determined by the Administrative Agent
and adjusted quarterly on each Calculation Date; provided that the Applicable Margin shall be based on Pricing Level II from and after the Tenth Amendment Effective Date until the first Calculation
Date occurring after the Tenth Amendment Effective Date and, thereafter the Pricing Level shall be determined by reference to the Average Utilization Percentageas of the last day of the most recently ended fiscal quarter of the U.S. Borrower
preceding the applicable Calculation Date. The Applicable Margin shall be effective from one Calculation Date until the next Calculation Date. Any adjustment in the Applicable Margin shall be applicable to all Extensions of Credit then existing or
subsequently made or issued.
 "Approved Fund" means any Person (other than a natural
Person), including, without limitation, any special purpose entity, that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its
business; provided, that such Approved Fund must be administered, managed or underwritten by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or
manages a Lender.
 "April 2008 Convertible Indebtedness" means that certain Indebtedness
incurred by the Parent in accordance with the terms of Section 12.1(o)(viii) on or prior to April 15, 2008, which is convertible into Capital Stock of the Parent.
 "Asset Coverage Amount" means, as of any date of determination, an amount equal to sixty percent (60%)
of the net book value of the Coverage Assets as set forth on the Consolidated balance sheet of the Borrower and its Consolidated Subsidiaries most recently delivered pursuant to Section 5.2 or Section 7.1 hereof.
 "Asset Disposition" means the disposition of any or all of the assets (including, without limitation,
any Capital Stock owned thereby) of the U.S. Borrower or any of its Subsidiaries whether by sale, lease, transfer or otherwise. The term "Asset Disposition" shall not include any Insurance and Condemnation Event.
 "Asset Sale Reduction Amount" means:
 (a)       with respect to any Asset Disposition or Insurance and Condemnation Event with respect to
the New U.S. Borrower Fixed Assets, one hundred percent (100%)
  
  
 3
  
 

  
  

  
  

 of the Net Cash Proceeds of such Asset Disposition or Insurance and Condemnation Event; or
 (b)       with respect to any other Asset Disposition or Insurance and Condemnation Event, seventy
five percent (75%) of the Net Cash Proceeds of such Asset Disposition or Insurance and Condemnation Event.
 "Assignment and Assumption" means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 14.10), and accepted by the
Administrative Agent, in substantially the form of Exhibit G or any other form approved by the Administrative Agent.
 "Attributable Indebtedness" means, on any date, (a) in respect of any Capital Lease of any Person, the
capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease, the capitalized amount or principal amount of the remaining lease payments
under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease.
 "Average Utilization" means, for any calendar quarter, the average daily principal balance of all
Extensions of Credit outstanding during such calendar quarter.
 "Average Utilization Percentage" means, for any calendar quarter, the ratio of (a) the Dollar Amount of the Average Utilization for such quarter to (b) the aggregate amount of the Revolving Credit Commitments of all Lenders as of the end of such quarter.
  
 "BA Discount
Rate" means, with respect to an issue of Bankers' Acceptances with the same maturity date, (a) for a Lender which is a Schedule I Lender, the CDOR Rate for the appropriate term, and (b) for a Lender which is a Lender (other
than a Schedule I Lender), the arithmetic average (rounded upwards to the nearest 1/100 of 1%) of the actual discount rates for Bankers' Acceptances for such term accepted by the Schedule II or III Reference Banks established in accordance with
their normal practices at or about 10:00 a.m. (Toronto time) on the date of issuance.
 "BA Equivalent
Loan" means a Revolving Credit Loan made to the Borrower by a Non-BA Lender in lieu of accepting such Non-BA Lender's share of Bankers' Acceptances which may be evidenced by a Discount Note.
 "BA Loan" means a borrowing by the Borrower by way of the issuance of Bankers' Acceptances and includes
a BA Equivalent Loan.
 "BA Proceeds" means, for any Bankers' Acceptance issued and to be
purchased by the Lenders hereunder, an amount calculated on the applicable date that such Bankers' Acceptance is accepted by dividing:
 
	  
	 (a)
	 the face
amount of such Bankers' Acceptance

 by
  

  
 4
  
 

  
  
 
  
 -

 
	  
	 (b)
	 the sum of
one plus the product of:

 
	  
	 (i)
	 the BA
Discount Rate applicable thereto

 and
 (ii)       a fraction, the numerator of which is the number of days in the applicable Interest
Period and the denominator of which is the number of days in the applicable year, being 365 or 366, as the case may be,
 with the product being rounded up or
down to the (A) second decimal place (with .005 being rounded up) and (B) nearest whole cent with one-half of one cent being rounded up.
 "Bankers' Acceptance" means each bill of exchange, including a depository bill issued in accordance with the Depository Bills and Notes Act (Canada), denominated in Canadian Dollars, drawn by the Borrower and accepted by a Lender (including, without limitation, each Discount Note).
 "Base Rate" means, at any time, the higher of (a) the Prime Rate and (b) the Federal Funds Rate
plus 1/2 of 1%; each change in the Base Rate shall take effect simultaneously with the corresponding change or changes in the Prime Rate or the Federal Funds Rate.
 "Base Rate Loan" means any Loan made to the Borrower in Dollars which bears interest at a rate based
upon the Base Rate as provided in Section 4.1(a).
 "BCFC Notes" means the 7.95% Notes due
2011 issued pursuant to the Indenture dated as of October 31, 2001 among Bowater Canada Finance Corporation, as Issuer, the Original U.S. Borrower, as Guarantor, and The Bank of New York, as Trustee.
 "Borrower" has the meaning assigned thereto in the introductory paragraph hereto.
 "Borrowing Base" means, at any time, the amount equal to:
 
	  
	 (c)
	 the sum of:

 
	  
	 (i)
	 up to
eighty-five percent (85%) of Eligible Domestic Accounts; plus

 (ii)       the lesser of (A) up to eighty-five percent (85%)of Eligible Foreign Accounts and (B) an amount equal to the Designated Available Foreign Account Amount at such time (it being understood and
agreed that, as of any applicable date of determination of the Borrowing Base or the U.S. Borrowing Base, the sum of (1) the Designated Available Foreign Account Amount plus (2) the Designated U.S.
Available Foreign Account Amount shall not exceed the amount set forth below during the applicable period set forth below):
  
  
 5
  
 

  
  
 
  
 -

 
 
	 Applicable Period
	 Maximum Available Foreign Account Amount

	 Tenth Amendment Effective Date to but excluding December 31, 2008
	 Lesser of (a) $115,000,000 and (b) if the Policy Sublimit is reduced to an amount less than $75,000,000, the Policy Sublimit as of such
date

	 December 31, 2008 to but excluding the Conversion Date
	 Lesser of (a) $100,000,000 and (b) if the Policy Sublimit is reduced to an amount less than $75,000,000, the Policy Sublimit as of such
date

	 Conversion Date to but excluding June 30, 2009
	 Lesser of (a) $75,000,000 and (b) the Policy Sublimit as of such date

	 June 30, 2009 and thereafter
	 Lesser of (a) $50,000,000 and (b) the Policy Sublimit as of such date

  
 plus
 
	  
	 (b)
	 the sum of:

 (i)        with respect to Eligible Inventory consisting
of work in process, an amount equal to the least of: (A) up to fifty percent (50%) of the Value of such Eligible Inventory, (B) up to eighty-five percent (85%) of the Net Recovery Percentage of such Eligible Inventory, and (C) $1,500,000;
plus
 (ii)       with respect to Eligible Inventory consisting
of finished goods and raw materials, the lesser of: (A) up to seventy-five percent (75%) of the Value of such Eligible Inventory and (B) up to eighty-five percent (85%) of the Net Recovery Percentage of such Eligible Inventory;
 minus
 
	  
	 (c)
	 any Reserves.

 "Borrowing Base Certificate" means a certificate substantially
in the form of Exhibit K.
 "Borrowing Limit" means, at any time, the least of:
 (a)       the aggregate principal amount of the Commitments at such time less, except with respect to Section 2.4(b)
and Section 5.2(e)(iii),
 (i)        in the case of any request for Revolving Credit Loans (other than BA Loans), the sum of the Swingline Commitment (less, during a Reallocation Period, the principal amount of outstanding
Swingline Loans which have been
  
  
 6
  
 

  
  
 
  
 -

 refunded, or participated, pursuant to
 Section 2.2) and of all outstanding BA Loans and L/C Obligations;
  
 (ii)       in the case of any request for Swingline Loans, the sum of all outstanding Revolving
Credit Loans (including BA Loans) and L/C Obligations;
  
 (iii)      in the case of any request for BA Loans, the sum of the Swingline Commitment (less, during a
Reallocation Period, the principal amount of outstanding Swingline Loans which have been refunded, or participated, pursuant to Section 2.2) and of all outstanding Revolving Credit Loans (other than BA
Loans) and L/C Obligations; or
  
 (iv)      in the case of any request for issuance of a Letter of Credit, the sum of the Swingline
Commitment (less, during a Reallocation Period, the principal amount of outstanding Swingline Loans which have been refunded, or participated, pursuant to Section 2.2) and all outstanding Revolving
Credit Loans (including BA Loans); and
  
 (b)       the amount which, when aggregated with the aggregate amount of all other Extensions of Credit, does not exceed the Asset Coverage Amount; and
 (c)       at any time on or after the Tenth Amendment Effective Date but prior to the Conversion Date, the sum of (i)
the Borrowing Base at such time plus (ii) the Overadvance Amount at such time less (iii) except with respect to Section
2.4(b),
 (i)        in the case of any request for
Revolving Credit Loans (other than BA Loans), the sum of the Swingline Commitment (less, during a Reallocation Period, the principal amount of outstanding Swingline Loans which have been refunded, or participated, pursuant to Section 2.2) and of all outstanding BA Loans and L/C Obligations;
  
 (ii)       in the case of any request for Swingline Loans, the sum of all outstanding Revolving
Credit Loans (including BA Loans) and L/C Obligations;
  
 (iii)      in the case of any request for BA Loans, the sum of the Swingline Commitment (less, during
a Reallocation Period, the principal amount of outstanding Swingline Loans which have been refunded, or participated, pursuant to Section 2.2) and of all outstanding Revolving Credit Loans (other than
BA Loans) and L/C Obligations; or
  
 (iv)      in the case of any request for issuance of a Letter of Credit, the sum of the Swingline
Commitment (less, during a Reallocation Period, the principal amount of outstanding Swingline Loans which have been refunded, or participated, pursuant to Section 2.2) and all outstanding Revolving
Credit Loans (including BA Loans); and
  
  
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 (d)       at any time on or after the Conversion Date, the Borrowing Base at such time less
, except with respect to Section 2.4(b),
 (i)        in the case of any request for Revolving Credit Loans (other than BA Loans), the sum of the Swingline Commitment (less, during a Reallocation Period, the principal amount of outstanding
Swingline Loans which have been refunded, or participated, pursuant to Section 2.2) and the sum of all outstanding BA Loans and L/C Obligations;
  
 (ii)       in the case of any request for Swingline Loans, the sum of all outstanding Revolving Credit Loans (including BA Loans) and L/C Obligations;
  
 (iii)      in the case of any request for BA Loans, the sum of the Swingline Commitment (less, during a Reallocation Period, the principal amount of outstanding Swingline Loans which have been refunded, or
participated, pursuant to Section 2.2) and of all outstanding Revolving Credit Loans (other than BA Loans) and L/C Obligations; or
  
 (iv)      in the case of any request for issuance of a Letter of Credit, the sum of the Swingline Commitment (less, during a Reallocation Period, the principal amount of outstanding Swingline Loans which have
been refunded, or participated, pursuant to Section 2.2) and all outstanding Revolving Credit Loans (including BA Loans).
  
 "Bowater-Calhoun Arrangement
" means that certain intercompany loan arrangement pursuant to which:
 (d)       the Original U.S. Borrower loaned $33,294,000 of proceeds of the McMinn County pollution control bonds to Calhoun Newsprint Company as evidenced by an intercompany note payable to the Original U.S.
Borrower; and
 (e)       Calhoun Newsprint Company loaned such proceeds back to the Original U.S.
Borrower as evidenced by an intercompany note payable to Calhoun Newsprint Company and secured by the Original U.S. Borrower's intercompany note receivable referred to in clause (a).
 "Bowater Guaranteed Obligations" has the meaning assigned thereto in Section 11.1.
 "Business Day" means:
 (f)        for all purposes other than as set forth in clause (b) below, any day other than a Saturday, Sunday
or legal holiday on which banks in New York, New York, Toronto, Ontario and Montreal, Québec are open for the conduct of their commercial banking business; and
 (g)       with respect to all notices and determinations in connection with, and payments of principal and interest
on, any LIBOR Rate Loan, any day that is a Business Day described in clause (a) and that is also a day for trading by and between banks in deposits for the applicable
  

  
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 Permitted Currency in the London interbank market or any other applicable offshore interbank market for such Permitted Currency.
 "Calculation Date" means each date that is ten (10) Business Days after the end of each fiscal quarter
of the Original U.S. Borrower.
 "Canadian Dollar" or "C$" means, at any time of
determination, the lawful currency of Canada.
 "Canadian Employee Benefit Plan" means (a)
any employee benefit plan that is maintained for the benefit of employees or former employees of the Borrower or any of its Domestic Subsidiaries registered in accordance with the ITA or other Applicable Law which the U.S. Borrower or any of its
Subsidiaries sponsors, maintains, or to which it makes, is making, or is obligated to make, contributions or (b) any Canadian Pension Plan or Canadian Multiemployer Plan that has at any time within the preceding six (6) years been maintained for the
employees of the U.S. Borrower or any of its Subsidiaries, and shall not include any Employee Benefit Plan.
 "Canadian Fixed Asset Mortgages" means, collectively, those certain mortgages, hypothecs, deeds of trust, security agreements, subordination agreements or other real property security documents encumbering the Canadian
Fixed Assets located in (a) Thunder Bay, Ontario, (b) Gatineau, Quebec and (c) Dolbeau, Quebec, in each case, executed by the applicable Credit Party in favor of the Administrative Agent, for the ratable benefit of the Secured Parties, as amended,
restated, supplemented or otherwise modified from time to time in form and substance reasonably satisfactory to the Administrative Agent.
 "Canadian Fixed Assets" means any Fixed Assets that are located in Canada and are owned by the Borrower or any Domestic Subsidiary thereof.
 "Canadian GAAP" means generally accepted accounting principles in Canada, that are applicable to the
circumstances as of the date of determination, consistently applied.
 "Canadian Multiemployer Plan" means a "multi-employer pension plan" as defined by Applicable Laws and registered in accordance with the ITA or other Applicable Laws and as to which the U.S. Borrower or any of its Subsidiaries is making, or is accruing an obligation to
make, or has accrued an obligation to make, contributions within the preceding six (6) years, and shall not include any Multiemployer Plan.
 "Canadian Pension Plan" means any Canadian Employee Benefit Plan, other than a Canadian Multiemployer Plan, which is registered in accordance with the ITA or other Applicable Law and which (a) is
maintained for the employees of the U.S. Borrower or any of its Subsidiaries or (b) has at any time within the preceding six (6) years been maintained for the employees of the U.S. Borrower or any of its Subsidiaries which the U.S. Borrower or any
of its Subsidiaries sponsors, maintains, or to which it makes, is making or is obligated to make, contributions, and shall not include any Pension Plan.
 "Canadian Prime Rate" means,
  

  
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 (h)       with respect to Revolving Credit Loans denominated in Canadian Dollars, at any time, the greater of (i)
the rate of interest per annum announced by the Administrative Agent from time to time (and in effect on such day) as its prime rate for Canadian Dollar commercial loans made in Canada, as adjusted automatically from time to time and without notice
to the Borrower upon change by the Administrative Agent and (ii) one percent (1%) plus the one (1) month CDOR Rate from time to time (and in effect on such day) as advised by the Administrative Agent to
the Borrower from time to time pursuant hereto; and
 (i)        with respect to Swingline Loans
denominated in Canadian Dollars, at any time, the greater of (i) the rate of interest per annum announced by the Swingline Lender from time to time (and in effect on such day) as its prime rate for Canadian Dollar commercial loans made in Canada, as
adjusted automatically from time to time and without notice to the Borrower upon change by the Swingline Lender and (ii) one percent (1%) plus the one (1) month CDOR Rate from time to time (and in
effect on such day) as advised by the Swingline Lender to the Borrower from time to time pursuant hereto.
 The parties hereto acknowledge
that the rate announced publicly by the Administrative Agent or the Swingline Lender, as applicable, as its prime rate is an index or base rate and shall not necessarily be its lowest or best rate charged to its customers or other banks.

"Canadian Prime Rate Loan" means any Loan made to the Borrower in Canadian Dollars which bears
interest based upon the Canadian Prime Rate as provided in Section 4.1(a).
 "Canadian Pro Rata
Percentage" means, as of any date of determination, the percentage obtained by the following formula:
  
 (a)       the aggregate Commitment applicable to all Lenders as of 11:00 a.m. on such date of
determination
  
 divided
by
  
 (b)       the sum of (i) the aggregate Commitment applicable to all Lenders as of 11:00 a.m. on such date of determination plus (ii) the aggregate U.S.
Commitment applicable to all U.S. Lenders as of 11:00 a.m. on such date of determination.
  
 "Capital Asset" means, with respect to the U.S. Borrower and its Subsidiaries, any asset that should,
in accordance with GAAP, be classified and accounted for as a capital asset on a Consolidated balance sheet of the U.S. Borrower and its Subsidiaries.
 "Capital Expenditures" means, with respect to the U.S. Borrower and its Subsidiaries for any period,
the aggregate cost of all Capital Assets acquired by the U.S. Borrower and its Subsidiaries during such period, as determined in accordance with GAAP.
 "Capital Lease" means any lease of any property by the U.S. Borrower or any of its Subsidiaries, as
lessee, that should, in accordance with GAAP, be classified and accounted for as a capital lease on a Consolidated balance sheet of the U.S. Borrower and its Subsidiaries.
  

  
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 "Capital Stock" means (a) in the case of a corporation, capital stock, (b) in the case of an
association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock, (c) in the case of a partnership, partnership interests (whether general or limited), (d) in the case
of a limited liability company, membership interests and (e) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.
 "Cash Equivalents" means, collectively:
 (j)        marketable obligations issued or unconditionally guaranteed by the United States, Canada or any
agency thereof maturing within two hundred seventy (270) days from the date of acquisition thereof;
 (k)       commercial paper maturing no more than two hundred seventy (270) days from the date of creation thereof and currently having the highest rating obtainable from either S&P, Moody's or
DBRS;
 (l)        certificates of deposit, time deposits and bankers' acceptances maturing no
more than two hundred seventy (270) days from the date of creation thereof issued by commercial banks incorporated under the laws of the United States or Canada, each having combined capital, surplus and undivided profits of not less than
$500,000,000 and having a rating of "A" or better by a nationally recognized rating agency; provided that the aggregate amount invested in such certificates of deposit shall not at any time exceed
$5,000,000 for any one such certificate of deposit and $10,000,000 for any one such bank;
 (m)      repurchase obligations for underlying securities of the types described in, and satisfying the requirements specified in, clauses (a) and (c) above entered into with any bank satisfying the requirements
specified in clause (c) above;
 
	  
	 (n)
	 demand
deposit accounts maintained in the ordinary course of business; and

 (o)       (i)        money market mutual or similar funds which (A) invest solely in assets of the types described in clauses (a) through (e) above, without regard to
the limitations as to the maturity of such obligations, bankers' acceptances, time deposits, certificates of deposit, repurchase agreements or commercial paper set forth above, (B) are rated at least "AAm" or "AAmg" or their equivalent by both
S&P and Moody's, provided that there is no "r-highlighter" affixed to such rating and (C) comply with Rule 2a-7 of the Investment Company Act of 1940, as amended; and
 (ii)       the money market fund called Columbia Cash Reserves, so long as Columbia Cash
Reserves continues to buy only "first tier" securities as defined by Rule 2a-7 of the Investment Company Act of 1940, as amended.
 "Cash Management Arrangement" means any cash management arrangement (a) entered into by (i) any Credit Party (other than the U.S. Borrower) and (ii) any Lender or any Affiliate thereof at the
time such cash management arrangement was entered into, as counterparty and (b) which has been designated by such Lender or such Affiliate, by notice to the Administrative Agent and the Borrower no later than thirty (30) days after the execution and
delivery of the
  
  
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 agreements governing such cash management arrangement,
as a Cash Management Arrangement. The designation of any cash management arrangement as a Cash Management Arrangement hereunder shall not create in favor of the Lender or Affiliate thereof that is a party thereto any rights in connection with the
management or release of any Collateral or of the Obligations of any Credit Party under any Loan Document. For avoidance of doubt, all cash management arrangements in existence on the Tenth Amendment Effective Date between any Credit Party and any
Lender or an Affiliate thereof shall constitute Cash Management Arrangements hereunder.
 "CCQ" means the Civil Code of Québec as in effect in the Province of Québec, as amended or modified from time to time.
 "CDOR Rate" means, on any day, with respect to a particular term as specified herein, the annual rate
of discount or interest which is the arithmetic average of the discount rates (rounded upwards to the nearest multiple of 0.01%) for bankers' acceptances denominated in Canadian Dollars for such term and face amount identified as such on the Reuters
Screen CDOR Page at approximately 10:00 a.m. (Toronto time) on such day, or if such day is not a Business Day, then on the immediately preceding Business Day (as adjusted by the Administrative Agent after 10:00 a.m. (Toronto time) to reflect any
error in any posted rate or in the posted average annual rate). If the rate does not appear on the Reuters Screen CDOR Page as contemplated above, then the CDOR Rate on any day shall be calculated by the Administrative Agent as the arithmetic
average of the discount rates (rounded upwards to the nearest multiple of 0.01%) for bankers' acceptances denominated in Canadian Dollars for such term and face amount of, and as quoted by, the Schedule I Reference Banks, as of 10:00 a.m. (Toronto
time) on that day, or if that day is not a Business Day, then on the immediately preceding Business Day. Each calculation by the Administrative Agent of the CDOR Rate shall be binding and conclusive for all purposes, absent manifest
error.
 "Change in Control" means an event or series of events by which (a) except in the
case of the conversion to Capital Stock of the April 2008 Convertible Indebtedness (as to which this clause (a) shall not apply), any person or group of persons (within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended) shall obtain ownership or control in one or more series of transactions of more than thirty-five percent (35%) of the Capital Stock or thirty-five percent (35%) of the voting power of the Parent entitled to vote in the election of members
of the board of directors of the Parent, (b) after giving effect to the conversion to Capital Stock of the April 2008 Convertible Indebtedness and solely in connection therewith, any person or group of persons (within the meaning of Section 13(d) of
the Securities Exchange Act of 1934, as amended) shall obtain ownership or control in one or more series of transactions of fifty percent (50%) or more of the Capital Stock or fifty percent (50%) or more of the voting power of the Parent entitled to
vote in the election of members of the board of directors of the Parent, (c) during any period of twenty-five (25) consecutive calendar months, a majority of the members of the board of directors of the Parent cease to be composed of Continuing
Directors, (d) there shall have occurred under any indenture or other instrument evidencing any Indebtedness of the U.S. Borrower or any of its Subsidiaries in excess of $25,000,000 any "change in control" or similar provision (as set forth in the
indenture, agreement or other evidence of such Indebtedness) obligating the U.S. Borrower or any of its Subsidiaries to repurchase, redeem or repay all or any part of such Indebtedness or Capital Stock provided for therein (provided that if such obligation
  
  
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 is contingent on any other event or circumstance, then such "change in control" shall not constitute a Change in Control hereunder unless such other event or circumstance
also has occurred or exists), (e) the Parent shall cease to own one hundred percent (100%) of the Capital Stock of the Original U.S. Borrower, (f) the Original U.S. Borrower shall cease to own, directly or indirectly, one hundred percent (100%) of
the Capital Stock of the Borrower or (g) the Parent shall cease to own one hundred percent (100%) of the Capital Stock of any New U.S. Borrower.
 For the purposes hereof, "Continuing Directors" means, during any period of twenty-five (25) consecutive calendar months, individuals (i) who were
members of the board of directors on the first day of such period, (ii) whose election or nomination to the board of directors was approved by individuals who comprised a majority of the board of directors on the first day of such period or (iii)
whose election or nomination to the board of directors was approved by (A) individuals who were members of the board of directors on the first day of such period or (B) individuals whose election or nomination to the board of directors was approved
by a majority of the board of directors on the first day of such period; provided that in each case such individuals referenced in clause (A) and clause (B) constituted a majority of the board of
directors at the time of such election or nomination.
 "Change in Law" means the
occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or
application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.
  
 "Closing
Date" means May 31, 2006.
 "Code" means the Internal Revenue Code
of 1986, and the rules and regulations thereunder, each as amended or modified from time to time.
 "Collateral
" means the collateral security for the Obligations and/or the U.S. Obligations (as the case may be) pledged or granted pursuant to the Security Documents.
 "Collateral Agreement" means the collateral agreement dated as of the Closing Date executed by the
Credit Parties in favor of the Administrative Agent, for the benefit of the Secured Parties, substantially in the form of Exhibit I, as amended, restated, supplemented or otherwise modified from time to
time.
 "Combination" means the combination of the Original U.S. Borrower with
Abitibi-Consolidated Inc., with the Parent as a common holding company, pursuant to the terms of the Combination Agreement.
 "Combination Agreement" means that certain Combination Agreement and Agreement and Plan of Merger dated as of January 29, 2007 among the Parent, Abitibi-Consolidated Inc., the Original U.S.
Borrower, Alpha-Bravo Merger Sub Inc., a Delaware corporation, and Bowater Canada, Inc., as the same may be amended, modified or supplemented from time to time.
 "Commitment" means (a) as to any Lender, the obligation of such Lender to make Extensions of Credit to
the Borrower hereunder in an aggregate principal amount at any time
  
  
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 outstanding not to exceed the amount set forth opposite such Lender's name on the Register, as such amount may be modified at any time or from time to time pursuant to
the terms hereof and (b) as to all Lenders, the aggregate commitment of all Lenders to make Extensions of Credit, as such amount may, subject to Section 14.2(b)(ii), be modified at any time or from time
to time pursuant to the terms hereof. The Commitment of all the Lenders on the Closing Date shall be $165,000,000, the Commitments of all the Lenders on the Sixth Amendment Effective Date shall be $112,500,000, the Commitments of all Lenders on the
Seventh Amendment Effective Date shall be $143,750,000 and the Commitments of all Lenders on the Tenth Amendment Effective Date shall be $141,177,293.
 "Commitment Percentage" means, as to any Lender at any time, the ratio of (a) the amount of the
Commitment of such Lender to (b) the Commitments of all the Lenders; provided that at any time other than during a Reaollocation Period, the Commitment Percentage of the Swingline Lender with respect to
Swingline Loans and the Swingline Commitment shall be one hundred percent (100%) and the Commitment Percentage of all other Lenders with respect to Swingline Loans and the Swingline Commitment shall be zero percent (0%); provided further that, at any time during a Reallocation Period, the Commitment Percentage of the Lenders with respect to that portion of the outstanding Swingline Loans required to be
refunded, or participated, pursuant to Section 2.2 shall be equal to the ratio of (x) the amount of the Commitment of such Lender to (y) the Commitments of all the Lenders.
 "Consolidated" means, when used with reference to financial statements or financial statement items of
any Person, such statements or items on a consolidated basis in accordance with applicable principles of consolidation under GAAP; provided, however, that, when used with respect to the U.S. Borrower,
"Consolidated" shall include the Original U.S. Borrower and its Subsidiaries (other than the Abitibi Entities) combined with each New U.S. Borrower and its Subsidiaries (if any).
 "Consolidated Adjusted EBITDA" means, for any period, the sum for the U.S. Borrower and its
Consolidated Subsidiaries (determined on a Consolidated basis, without duplication, in accordance with GAAP) of the following: (a) Consolidated EBITDA for such period plus (b) any net gain on any Asset
Disposition during such period minus (c) any net loss on any Asset Disposition during such period; provided that, for purposes of this Agreement,
Consolidated Adjusted EBITDA shall be adjusted on a pro forma basis, in a manner consistent with Regulation S-X of the SEC or otherwise reasonably acceptable to the
Administrative Agent, to include or exclude, as applicable, as of the first day of any applicable period, (A) any Permitted Acquisition closedduring such period or (B) any permitted Asset Disposition closedduring such period (other than Asset
Dispositions permitted pursuant to Section 10.5(a)-(h)) of assets having an aggregate fair market value (at the time of the closing of such Asset Disposition) in excess of $50,000,000.
 "Consolidated EBITDA" means, for any period, the sum for the U.S. Borrower and its Consolidated
Subsidiaries (determined on a Consolidated basis, without duplication, in accordance with GAAP) of the following:
 
	  
	 (p)
	 Consolidated
Net Income for such period,

 plus
  

  
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 (q)       the sum of the following to the extent deducted in determining Consolidated Net Income for such period:

 (i)        income taxes for such period (or minus
, to the extent added in determining Consolidated Net Income for such period, income tax benefit for such period);
 (ii)       amortization, depreciation, depletion and other non-cash charges for such period;

 (iii)      Consolidated Interest Expense for such period;
 (iv)      any extraordinary charges for such period;
 (v)       any unusual or non-recurring charges for such period up to an amount not to exceed
five percent (5%) of the Consolidated EBITDA of the U.S. Borrower and its Subsidiaries (as calculated without giving effect to this clause (v) or clause (vi) below);
 (vi)      any cost savings and synergies associated with a Permitted Acquisition not to exceed five
percent (5%) of the Consolidated EBITDA of the U.S. Borrower and its Subsidiaries (as calculated without giving effect to this clause (vi) or clause (v) above); and
 (vii)     any net loss on any Asset Disposition during such period;
 less
 (r)        the sum of the following to the extent included in determining Consolidated Net Income for such period:
 
	  
	 (i)
	 the aggregate
amount of interest income for such period;

 
	  
	 (ii)
	 any
extraordinary gains during such period;

 
	  
	 (iii)
	 any unusual
or non-recurring gains during such period; and

 
	  
	 (iv)
	 any net gain
on any Asset Disposition during such period;

 provided that, for purposes of this Agreement, Consolidated
EBITDA shall be adjusted on a pro forma basis, in a manner consistent with Regulation S-X of the SEC or otherwise reasonably acceptable to the Administrative Agent and the
U.S. Administrative Agent, to include or exclude, as applicable, as of the first day of any applicable period, (A) any Permitted Acquisition closedduring such period or (B) any permitted Asset Disposition closedduring such period (other than Asset
Dispositions permitted pursuant to Section 10.5(a)-(h)) of assets having an aggregate fair market value (at the time of the closing of such Asset Disposition) in excess of $50,000,000.
 "Consolidated Interest Expense" means, with respect to the U.S. Borrower and its Consolidated
Subsidiaries for any period, (a) the gross interest expense (including, without limitation, interest expense attributable to Capital Leases and plus the net amount payable (or
  

  
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 minus the net amount receivable) under any Interest Rate Contracts of the U.S. Borrower and its Consolidated Subsidiaries), plus (b) the
aggregate amount of all cash distributions or dividends paid by the U.S. Borrower and its Consolidated Subsidiaries to the Parent pursuant to, and in accordance with, Section 10.6(j) , all determined for such period on a Consolidated basis without
duplication, in accordance with GAAP.
 "Consolidated Net Income" means, with respect to
the U.S. Borrower and its Consolidated Subsidiaries, for any period of determination, the net income (or loss) of the U.S. Borrower and its Consolidated Subsidiaries for such period, determined on a Consolidated basis in accordance with
GAAP.
 "Consolidated Senior Secured Leverage Ratio" means, as of any date of
determination, the ratio of (a) Consolidated Total Senior Secured Indebtedness on such date to (b) the sum, without duplication, of (i) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters ending on or immediately prior to such
date plus (ii) the amount of Specified Non-Recurring Charges taken during the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date.
 "Consolidated Subsidiary" means, for any Person, each Subsidiary of such Person (whether now existing
or hereafter created or acquired) the financial statements of which shall be (or should have been) consolidated with the financial statements of such Person in accordance with GAAP.
 "Consolidated Total Indebtedness" means, as of any date of determination, without duplication, all
Indebtedness (excluding clause (h) of the definition thereof) of the U.S. Borrower and its Consolidated Subsidiaries.
 "Consolidated Total Leverage Ratio" means, as of any date of determination, the ratio of (a) Consolidated Total Indebtedness on such date to (b) Consolidated EBITDAfor the period of four (4) consecutive fiscal quarters
ending on or immediately prior to such date.
 "Consolidated Total Senior Secured Indebtedness" means,
 (s)       for purposes of determining the Consolidated Senior Secured Leverage Ratio,
as of any date of determination with respect to the U.S. Borrower and its Consolidated Subsidiaries on a Consolidated basis, without duplication, the sum of (i) all outstanding U.S. Extensions of Credit (including, without limitation, each
outstanding letter of credit and each outstanding swingline loan) under the U.S. Credit Facility plus (ii) all outstanding Extensions of Credit (including, without limitation, each outstanding Letter of
Credit and each outstanding Swingline Loan) under the Credit Facility plus (iii) all other outstanding Indebtedness of the U.S. Borrower and its Consolidated Subsidiaries which is secured by any assets
of the U.S. Borrower and its Consolidated Subsidiaries other than any Hedging Agreement; and
 (t)        for all other purposes, as of any date of determination with respect to the U.S. Borrower and its Consolidated Subsidiaries on a Consolidated basis, without duplication, the sum of (i) all
outstanding U.S. Extensions of Credit (including, without limitation, each outstanding letter of credit and each outstanding swingline loan) under the U.S. Credit Facility plus (ii) all other
outstanding Indebtedness (other than any Hedging Agreement) of the U.S.
  
  
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 Borrower and its Consolidated Subsidiaries which is secured by a Lien on the U.S. Coverage Assets.
 "Consultants" means a third-party consultant hired by the U.S. Administrative Agent, on behalf of the
Secured Parties and the U.S. Secured Parties; provided, that if the Administrative Agent or the U.S. Administrative Agent shall determine in its reasonable discretion that a separate consultant or
consultants should be hired by such Person for the benefit of the Secured Parties or the U.S. Secured Parties, as the case may be, "Consultants" as defined in this Agreement shall refer collectively to all of the consultants hired by the
Administrative Agent and the U.S. Administrative Agent.
 "Conversion Date" means March
31, 2009; provided that, if on or prior to March 31, 2009, the Specified Abitibi Indebtedness is repurchased, repaid, exchanged (provided that the maturity
date of any Indebtedness exchanged therefor is later than April 30, 2009) or redeemed in full, or the maturity date thereof or the maturity date of any indebtedness exchanged therefor is, in any case, extended to a date later than April 30, 2009, or
any combination thereof, the Conversion Date shall automatically and without further action be extended to April 29, 2009.
 "Coosa Pines IDB" has the meaning set forth in the definition of Supplemental New U.S. Borrower Mortgage.
 "Coverage Assets" means all accounts receivable (excluding any intercompany accounts receivable) and
all inventory of the Borrower and its Domestic Subsidiaries; provided that for purposes of calculating the Asset Coverage Amount, the net book value of inventory constituting Coverage Assets shall not,
at any time, exceed $170,000,000.
 "Credit Facility" means, collectively, the Revolving
Credit Facility, the Swingline Facility and the L/C Facility.
 "Credit Insurance Policy"
means a foreign accounts receivable credit insurance policy as of any date issued by an insurer reasonably acceptable to the Administrative Agent and the U.S. Administrative Agent, containing terms and provisions (including, without limitation,
coverage amounts, limits, deductibles and exclusions from coverage) reasonably acceptable to the Administrative Agent and the U.S. Administrative Agent.
 "Credit Parties" means, collectively, the Borrower and the Guarantors.
 "DBRS" means DBRS Limited and any successor thereto.
 "Debt Issuance" means the issuance by the U.S. Borrower or any of its Subsidiaries of Indebtedness
permitted pursuant to Section 10.1(h) or 10.1(m) or otherwise consented to by the requisite Lenders pursuant to Section
14.2.
 "Debt Issuance Reduction Amount" has the meaning set forth
in Section 8.2(b)(ii).
 "Default" means any
of the events specified in Section 12.1 which with the passage of time, the giving of notice or any other condition, would constitute an Event of Default.
  
  
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 "Defaulting Lender" means any Lender that (a) has failed to fund any portion of the Revolving Credit
Loans or participations in L/C Obligations or participations in Swingline Loans required to be funded by it hereunder within one (1) Business Day of the date required to be funded by it hereunder, (b) has otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by it hereunder within one (1) Business Day of the date when due, unless such amount is the subject of a good faith dispute, or (c) has been deemed insolvent or become the
subject of a bankruptcy, receivership or insolvency proceeding.
 "Designated Available Foreign Account
Amount" means, as of any date of determination of the Borrowing Base or the U.S. Borrowing Base, the amount of Eligible Foreign Accounts designated by the Borrower in the Borrowing Base Certificate delivered as of such date.

 "Designated U.S. Available Foreign Account Amount" means, as of any date of
determination of the Borrowing Base or the U.S. Borrowing Base, the amount of "Eligible Foreign Accounts" (as defined in the U.S. Credit Agreement) designated by the Original U.S. Borrower in the U.S. Borrowing Base Certificate delivered as of such
date.
 "Determination Time" means (a) with respect to Extensions of Credit expressed in
Canadian Dollars, each of (i) approximately 11:00 a.m. (Toronto time) two (2) Business Days before such Extension of Credit is made or issued (or to be made or issued), as applicable, and (ii) approximately 11:00 a.m. (Toronto time) two (2) Business
Days before each date on which such Extension of Credit is continued pursuant to Section 4.2 or extended (or to be continued or extended), as applicable, (b) with respect to the second proviso in the definition of Overadvance Amount, approximately
11:00 a.m. (Toronto time) on the date of delivery of the certificate delivered pursuant to Section 8.10(f)(i)(J) or (c) at such times as may be reasonably determined by the Administrative Agent (not
more frequently than quarterly).
 "Discount Note" means a non-interest bearing promissory
note denominated in Canadian Dollars issued by the Borrower to a Non-BA Lender to evidence a BA Equivalent Loan.
 "Disputes" means any dispute, claim or controversy arising out of, connected with or relating to this Agreement or any other Loan Document, between or among parties hereto and to the other Loan Documents.
 "Document" has the meaning specified in Section 1.1 of
the Collateral Agreement.
 "Documentation Agent" means Wachovia Bank, National
Association, in its capacity as Documentation Agent hereunder.
 "Dollar Amount" means, as
of any date of determination, (a) with respect to each Extension of Credit or other sum expressed in Dollars, the amount thereof and (b) with respect to each Extension of Credit or other sum expressed in Canadian Dollars, the amount of Dollars which
is equivalent to the principal amount of such Extension of Credit or other sum, at the most favorable spot exchange rate reasonably determined by the Administrative Agent as of the most recent Determination Time.
 "Dollars" or "$" means, unless otherwise qualified, dollars in lawful currency of the United States.

  
  
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 "Domestic
Subsidiary" means any Subsidiary of the Borrower organized under the laws of Canada or any province or political subdivision thereof.
 "Eligible Accounts" means, at any time, Accounts of the Borrower and its Consolidated Subsidiaries
which the Administrative Agent determines, in the exercise of its reasonable business and credit judgment as a secured asset based lender, are eligible as the basis for the extension of Revolving Credit Loans and Swingline Loans and the issuance of
Letters of Credit hereunder. Without limiting the Administrative Agent's discretion provided herein, Eligible Accounts shall not include any Account:
 (a)       that does not arise out of actual and bona fide sales of goods or rendering of
services in the ordinary course of the Borrower's or the relevant Subsidiary's business, which transactions are completed in accordance with the terms and provisions of any documents related thereto;
 (b)       that would otherwise be an Eligible Domestic Account, but is payable other than in
Dollars or Canadian Dollars, or that is otherwise on terms other than those normal or customary in the Borrower's or the relevant Subsidiary's business;
 (c)       that would otherwise be an Eligible Foreign Account, but is payable other than in
Dollars, Canadian Dollars, Euros or Pounds Sterling or that is otherwise on terms other than those normal or customary in the Borrower's or the relevant Subsidiary's business;
 (d)       that is owing from an account debtor where the account debtor or any officer or
employee of the account debtor with respect to such Account is an officer, employee, agent or other Affiliate of the Borrower or any Subsidiary;
 (e) that would otherwise be an Eligible Domestic Account, but is unpaid more than ninety (90) days past original invoice date
or more than sixty (60) days past the original due date;
 (f)  that would otherwise be an Eligible
Foreign Account, but is unpaid more than one hundred eighty (180) days past original invoice date or more than sixty (60) days past the original due date;
 (g)       of any account debtor where fifty percent (50%) or more of the Accounts owing from
such account debtor are not deemed Eligible Accounts;
 (h)       that is owing by
an account debtor to the extent the aggregate amount of Accounts owing from such account debtor and its Affiliates to the Borrower or any of its Subsidiaries exceeds ten percent (10%) of the aggregate Eligible Accounts, but only the amount in excess
thereof shall be ineligible;
 (i)        that is owing from any Person that
(i) has disputed liability for any Account owing from such Person or (ii) has otherwise asserted any claim, demand or liability against the Borrower or any of its Subsidiaries, whether by action, suit, counterclaim or otherwise;

 

  
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 (j)        that is owing from any Person that shall take or be the subject of any action
or proceeding of a type described in Section 12.1(i) or Section 12.1(j);
 (k)       that is owing from any account debtor not deemed creditworthy at any time by the Administrative Agent in good faith;
 (l)        with respect to which any cheque or other instrument of payment has been
returned uncollected for any reason;
 
	  
	 (m)
	 which is
evidenced by a promissory note, chattel paper or instrument;

 (n)       that is owing by an account debtor located in any jurisdiction which requires filing of a "Notice of Business Activities Report" or other similar report in order to permit the Borrower or its
applicable Subsidiary to seek judicial enforcement in such jurisdiction of payment of such Account, unless the Borrower or its applicable Subsidiary has filed such report or qualified to do business in such jurisdiction;
 (o)        (i) owing from any Person that is also a supplier to or creditor of the
Borrower or any of its Subsidiaries or (ii) representing any manufacturer's or supplier's credits, discounts, incentive plans or similar arrangements entitling the Borrower or any of its Subsidiaries to discounts on future purchase
therefrom;
 (p)       that is owing by an account debtor whose chief executive
office with respect to such Account is located outside Canada or the United States, other than Eligible Foreign Accounts;
 (q)       that (i) is not evidenced by an invoice or other documentation satisfactory to the Administrative Agent which has been sent to the account debtor, (ii) is contingent upon the Borrower's or its
Subsidiary's completion of any further performance, (iii) represents a progress billing, or (iv) arises out of sales on a bill-and-hold, guaranteed sale, sale-or-return, sale on approval, consignment, cash on delivery basis or subject to any right
of return, repurchase, setoff or charge back;
 (r)        that is owing from
an account debtor that is an agency, department or instrumentality of the United States or Canada or any state or province thereof or that is an agency, department or instrumentality of any country other than the United States or Canada or any
state, territory, province or other political subdivision of a country other than the United States or Canada unless the Borrower or its relevant Subsidiary shall have satisfied the requirements of the Assignment of Claims Act of 1940 in the case of
Accounts owing from any agency, department or instrumentality of the United States, the Financial Administration Act (Canada) in the case of Accounts owing from an agency, department or instrumentality of Canada and any similar state or provincial
legislation or any similar foreign legislation and the Administrative Agent is satisfied as to the absence of setoffs, counterclaims and other defenses on the part of such account debtor;
 (s)       with respect to which any representation and warranty set forth in anyLoan Document
applicable to Accounts is not true and correct;
  
  
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 (t)        in respect of which the Collateral Agreement or any Quebec Collateral Document, after giving effect to the related filings of financing statements that have then been made, if any, does not
or has ceased to create a valid and perfected first priority lien or security interest in favor of the Administrative Agent, on behalf of the Secured Parties, securing the Obligations or which is subject to any Lien except those permitted under this
Agreement which does not have priority over the Liens of the Administrative Agent hereunder (which are subject to an intercreditor agreement in form and substance satisfactory to the Administrative Agent between the holder of such Lien and the
Administrative Agent);
 
	  
	 (u)
	 that is owing
to a non-Wholly Owned Subsidiary;

 (v)       that is, in
accordance with GAAP, classified as a contra-account which offset other assets on the balance sheet of the Borrower or its Subsidiaries;
 
	  
	 (w)
	 that is owing
by an account debtor located in an Excluded Country;

 (x)       that is owing by an account debtor whose total indebtedness to the Borrower or any of its Subsidiaries exceeds the credit limit with respect to such account debtor as determined by the Borrower or
any of its Subsidiaries from time to time, to the extent such credit limit as to any account debtor is established consistent with the practices of the Borrower in effect on the Tenth Amendment Effective Date (but the portion of the Accounts not in
excess of such credit limit may be deemed Eligible Accounts); or
 (y)       which
the Administrative Agent otherwise determines, in the exercise of its reasonable business and credit judgment as a secured asset based lender, is unacceptable for any reason whatsoever.
 "Eligible Assignee" means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund, and (d) any
other Person (other than a natural person) approved by (i) the Administrative Agent, (ii) the Swingline Lender, (iii) each Issuing Lender and (iv) unless a Default or Event of Default has occurred and is continuing, the Borrower (each such approval
not to be unreasonably withheld or delayed). Notwithstanding the foregoing, "Eligible Assignee" shall not include the U.S. Borrower or any of the U.S. Borrower's Affiliates or Subsidiaries.
 "Eligible Domestic Accounts" means Eligible Accounts owing by an account debtor whose chief executive
office with respect to such Accounts is located in Canada or in the United States.
 "Eligible Foreign Accounts
" means, so long as the Borrower maintains the Credit Insurance Policy, Eligible Accounts owing by an account debtor whose chief executive office with respect to such Accounts is located outside Canada and the United States.

 "Eligible Inventory" means, at any time, Inventory of the Borrower and its Consolidated
Subsidiaries which the Administrative Agent determines, in the exercise of its reasonable business and credit judgment as a secured asset based lender, are eligible as the basis for the extension of Revolving Credit Loans and Swingline Loans and the
issuance of Letters of Credit
  
  
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 hereunder. Without limiting the Administrative Agent's
discretion provided herein, Eligible Inventory shall not include any Inventory:
 (a)       that is located on leaseholds as to which the lessor has not entered into a collateral access agreement providing the Administrative Agent with the right to receive notices of default, the right to
repossess such Inventory at any time and such other rights as may be requested by the Administrative Agent, unless the Administrative Agent has established acceptable Reserves against such Inventory in lieu of obtaining a collateral access
agreement;
 (b)       that is slow moving, obsolete, unusable, unmerchantable,
damaged, defective, unfit for sale, perishable or otherwise unavailable for sale;
 (c)       consisting of promotional, marketing, packaging or shipping materials and supplies, prototypes, displays or display items, bill-and-hold goods, goods held on consignment or goods not of a types
held for sale in the ordinary course of business;
 (d)       that fails to meet
all standards imposed by any Governmental Authority having regulatory authority over such Inventory or its use or sale;
 (e)       that is subject to any licensing, patent, royalty, trademark, trade name or copyright agreement with any third party unless the Administrative Agent is satisfied that it may sell or otherwise
dispose of such Inventory without (i) infringing the rights of such party, (ii) violating any contract with such party or (iii) incurring any liability with respect to payment of royalties other than royalties incurred pursuant to the sale of such
Inventory under the current licensing agreements;
 (f)        that is subject
to a Lien of any other Person (unless such Person has entered into an intercreditor agreement, in form and substance satisfactory to the Administrative Agent which subordinates such Lien to the Liens of the Administrative Agent);
 
	  
	 (g)
	 that is
located outside Canada;

 (h)       that is not in the
possession of or under the sole control of the Borrower or any of its Subsidiaries (including any Inventory that is owned in part by another Person);
 (i)        with respect to which any representation and warranty set forth in anyLoan
Document applicable to Inventory is not true and correct;
 (j)        in
respect of which the Collateral Agreement or any Quebec Collateral Document, after giving effect to the related filings of financing statements that have then been made, if any, does not or has ceased to create a valid and perfected first priority
lien or security interest in favor of the Administrative Agent, on behalf of the Secured Parties, securing the Obligations;
 (k)       that is located in any third party warehouse or is in the possession of a bailee (other than a third party processor) and is not evidenced by a Document, unless
  
  
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 such warehouseman or bailee has
delivered to the Administrative Agent a collateral access agreement in form and substance acceptable to the Administrative Agent and such other documentation as the Administrative Agent may require or the Administrative Agent has established
acceptable Reserves against such Inventory in lieu of obtaining a collateral access agreement;
 (l)        which is being processed offsite at a third party location or outside processor, or is in transit to or from said third party location or outside processor;
 (m)      which is not reflected in a current perpetual inventory report of the Borrower delivered to
the Administrative Agent pursuant to Section 7.1(j);
 
	  
	 (n)
	 for which
reclamation rights have been asserted by the seller;

 
	  
	 (o)
	 which is
owned by any non-Wholly-Owned Subsidiary;

 (p)       that
is subject to repossession under the "30-day goods" rule in the Bankruptcy and Insolvency Act (Canada) except to the extent that the applicable vendor has entered into an agreement with the Administrative Agent in form and substance acceptable to
the Administrative Agent waiving its right to repossession; or
 (q)       which
the Administrative Agent otherwise determines, in the exercise of its reasonable business and credit judgment as a secured asset based lender, is unacceptable for any reason whatsoever.
 "Employee Benefit Plan" means (a) any employee benefit plan within the meaning of Section 3(3) of
ERISA that is maintained for employees of the U.S. Borrower or any of its Subsidiaries which the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates sponsors, maintains, or to which it makes, is making, or is obligated to make,
contributions or (b) any Pension Plan or Multiemployer Plan that has at any time within the preceding six (6) years been maintained for the employees of the U.S. Borrower or any of its Subsidiaries or any of their current or former ERISA Affiliates.

 "EMU Legislation" means legislative measures of the Council of European Union for the
introduction of, change over to or operation of the euro.
 "Environmental Claims" means
any and all administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, accusations, allegations, notices of noncompliance or violation, investigations (other than internal reports prepared by any Person in the
ordinary course of business and not in response to any third party action or request of any kind) or proceedings relating in any way to any actual or alleged violation of or liability under any Environmental Law or relating to any permit issued, or
any approval given, under any such Environmental Law, including, without limitation, any and all claims by Governmental Authorities for enforcement, cleanup, removal, response, remedial or other actions or damages, contribution, indemnification cost
recovery, compensation or injunctive relief resulting from Hazardous Materials or arising from alleged injury or threat of injury to human health or the environment.
  

  
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 "Environmental Laws" means any and all federal, foreign, state, provincial and local laws, statutes,
ordinances, codes, rules, legally binding policies, standards and regulations, permits, licenses, approvals, interpretations and orders of courts or Governmental Authorities, relating to the protection of human health or the environment, including,
but not limited to, requirements pertaining to the manufacture, processing, distribution, use, treatment, storage, disposal, transportation, handling, reporting, licensing, permitting, investigation or remediation of Hazardous Materials.

"ERISA" means the Employee Retirement Income Security Act of 1974, and the rules and regulations
thereunder, each as amended or modified from time to time.
 "ERISA Affiliate" means any
Person who together with the U.S. Borrower or any of its Subsidiaries is treated as a single employer within the meaning of Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA.
 "Euro" means the single currency to which the Participating Member States of the European Union have
converted.
 "Event of Default" means any of the events specified in Section 12.1;
provided that any requirement for passage of time, giving of notice, or any other condition, has been satisfied.
 "Exchangeable Shares" means those shares of Capital Stock issued by Bowater Canada, Inc. and listed on
the Toronto Stock Exchange (under stock symbol BWX) which are exchangeable at any time at the option of the holder of such shares into common stock of the Parent and which entitle the holders thereof to similar voting rights and dividend payments
(on a per share basis) as those granted to holders of the common stock of the Parent.
 "Excluded
Accounts" means any deposit, securities and other investments account of the U.S. Borrower and its Subsidiaries for which the U.S. Borrower is not providing balances and/or statements as required pursuant to Section 7.1(f)(ii) and (iii).
  
 "Excluded Country" means Venezuela, Guatemala and such other countries as determined by the
Administrative Agent or the U.S. Administrative Agent, in each case, in the exercise of its reasonable credit judgment (it being understood and agreed that no other country in which an account debtor is located with respect to the Accounts specified
in the Borrowing Base Certificate dated as of September 30, 2008 shall be deemed to be an Excluded Country).
  
 "Excluded Taxes" means, with respect to the Administrative Agent, any Lender, any Issuing Lender or any
other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable Lending Office is located, (b)
any branch profits taxes imposed by Canada or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section
4.12(b)), any withholding tax that is imposed on amounts payable to such Foreign Lender at the
  
  
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 time such Foreign Lender becomes a party hereto (or designates a new Lending Office) or is attributable to such Foreign Lender's failure or inability (other than as a
result of a Change in Law) to comply with Section 4.11(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment), to receive additional amounts from
the Borrower with respect to such withholding tax pursuant to Section 4.11(a).
  
 "Existing Facilities" means the collective reference to (a) the credit facility established pursuant to
that certain Credit Agreement dated as of April 22, 2004 (as amended, restated, supplemented or modified) by and among the Original U.S. Borrower and the Borrower, as borrowers, JPMorgan Chase Bank, as U.S. administrative agent, The Bank of Nova
Scotia, as Canadian administrative agent and the lenders party thereto and (b) the conduit facility established pursuant that certain Loan Agreement dated as of December 19, 2002 (as amended, restated, supplemented or modified) by and among Bowater
Funding Inc., as borrower, the U.S. Borrower, as initial servicer, the lenders party thereto, SunTrust Capital Markets, Inc. and Wachovia Bank, National Association, as co-agents, and SunTrust Capital Markets, Inc., as administrative
agent.
 "Existing Letters of Credit" means those letters of credit existing on the Closing
Date and identified on Schedule 1.1(a).
 "Existing
Notes" means the collective reference to each of the senior unsecured notes and debentures set forth on Schedule 10.1.
 "Extensions of Credit" means, as to any Lender at any time, (a) an amount equal to the sum of (i) the
aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding, (ii) such Lender's Revolving Credit Commitment Percentage of the L/C Obligations then outstanding and (iii) such Lender's Commitment Percentage of the
Swingline Loans then outstanding or (b) the making of any Loan or participation in any Swingline Loan or any Letter of Credit by such Lender, as the context requires.
 "Federal Funds Rate" means, for any day, the rate per annum equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day (or, if such day is not a Business Day, for the immediately preceding Business Day), as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day, provided that if such rate is not so published for any day which is a Business Day, the average of the quotation for such day on such
transactions received by the Administrative Agent from three Federal Funds brokers of recognized standing selected by the Administrative Agent.
 "Fee Letter" means the separate fee letter agreement executed by the Borrower and The Bank of Nova Scotia and/or certain of its affiliates dated May 31, 2006.
 "Fiscal Year" means the fiscal year of the U.S. Borrower and its Subsidiaries ending on December 31.

  
  
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 "Fixed Assets
" means, collectively, each mill owned by the U.S. Borrower or any Subsidiary (each, a "Mill"), the real property on which each such Mill is situated, all equipment used in
connection with each such Mill and all other rights and assets used for the operation, administration and maintenance of each such Mill. For the avoidance of doubt, the term Fixed Assets shall not include any timberlands owned by the U.S. Borrower
or any of its Subsidiaries.
 "Foreign Lender" means any Lender that is organized under the
laws of a jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, Canada and each province thereof shall be deemed to constitute a single jurisdiction.
 "Foreign Pledge Documents" means any pledge agreements, hypothecs, charges and other similar documents
and agreements granting a Lien on the Korean Shares in favor of the Administrative Agent, for the ratable benefit of the Secured Parties.
 "Fourth Amendment" means that certain Fourth Amendment dated as of Fourth Amendment Effective Date by and among the Borrower, the Guarantors and the Administrative Agent (on behalf of itself and
the Lenders party thereto).
 "Fourth Amendment Effective Date" means March 31,
2008.
 "Fifth Amendment" means that certain Fifth Amendment dated as April 30, 2008 by and
among the Borrower, the Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto).
 "GAAP" means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date
of determination, consistently applied.
 "Governmental Approvals" means all
authorizations, consents, approvals, permits, licenses and exemptions of, registrations and filings with, and reports to, all Governmental Authorities.
 "Governmental Authority" means the government of the United States, Canada or any other nation, or of
any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
 "Guarantors" means each Parent Guarantor and each Subsidiary Guarantor, and each New U.S. Borrower.

 "Guaranty Agreements" means, collectively, the Parent Guaranty Agreements and the
Subsidiary Guaranty Agreements.
  
  
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 "Guaranty
Obligation" means, with respect to the U.S. Borrower and its Subsidiaries, without duplication, any obligation, contingent or otherwise, of any such Person pursuant to which such Person has directly or indirectly guaranteed
any Indebtedness of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of any such Person (a) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness (whether arising by virtue of partnership arrangements, by agreement to keep well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement condition or otherwise) or
(b) entered into for the purpose of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided, that the term Guaranty Obligation shall not include endorsements for collection or deposit in the ordinary course of business.
 "Hazardous Materials" means any substances or materials (a) which are or become defined as hazardous
wastes, hazardous substances, pollutants, contaminants, chemical substances or mixtures or toxic substances under any Environmental Law, (b) which are toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic or
otherwise harmful to human health or the environment and are or become regulated by any Governmental Authority, (c) the presence of which require investigation or remediation under any Environmental Law or common law, (d) the discharge or
emission or release of which requires a permit or license under any Environmental Law or other Governmental Approval, (e) which are deemed to constitute a nuisance or a trespass which pose a health or safety hazard to Persons or neighboring
properties, (f) which consist of underground or aboveground storage tanks, whether empty, filled or partially filled with any substance, or (g) which contain, without limitation, asbestos, polychlorinated biphenyls, urea formaldehyde foam
insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic gas.
 "Hedging Agreement" means any agreement with respect to any Interest Rate Contract, forward rate agreement, commodity swap, forward foreign exchange agreement, currency swap agreement,
cross-currency rate swap agreement, currency option agreement or other agreement or arrangement designed to alter the risks of any Person arising from fluctuations in interest rates, currency values or commodity prices, all as amended, restated,
supplemented or otherwise modified from time to time.
 "Hedging Obligations" means all
existing or future payment and other obligations owing by any Credit Party under any Hedging Agreement (which such Hedging Agreement is permitted hereunder) with any Person that is a Lender or an Affiliate of a Lender at the time such Hedging
Agreement is executed.
 "Immaterial Subsidiary" means:
 
	  
	 (u)
	 each QSPE;

 (v)       any Domestic Subsidiary that is not a Wholly-Owned Subsidiary to
the extent that (i) there is a provision in the organizational documents of such Domestic Subsidiary or (ii) the Borrower or any of its Subsidiaries is party to a legally enforceable agreement, in either case that
  

  
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 would prohibit such Domestic Subsidiary from being a Subsidiary Guarantor without the consent of (or the approval of directors appointed by) a third party owner of such
Domestic Subsidiary; and
 (w)      any individual Domestic Subsidiary having total assets with a book value
that is less than one percent (1%) of the aggregate book value of the total Consolidated assets of the U.S. Borrower and its Subsidiaries (as of the most recent date for which financial statements have been delivered).
 "Indebtedness" means, with respect to any Person at any date and without duplication, the sum of the
following:
 (x)       all liabilities, obligations and indebtedness for borrowed money of such Person,
including, but not limited to, obligations evidenced by bonds, debentures, notes or other similar instruments of such Person;
 (y)       all obligations of such Person to pay the deferred purchase price of property or services (including, without limitation, all obligations under non-competition, earn-out or similar agreements in
connection with an acquisition), except trade payables and accrued obligations arising in the ordinary course of business, so long as such trade accounts payable are payable within ninety (90) days of the date the respective goods are delivered or
the respective services are rendered;
 (z)       the Attributable Indebtedness of such Person with
respect to such Person's obligations in respect of Capital Leases and Synthetic Leases (regardless of whether accounted for as indebtedness under GAAP);
 (aa)     all Indebtedness of any other Person secured by a Lien on any asset owned by such Person (including indebtedness
arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;
 
	  
	 (bb)
	 all Guaranty
Obligations of such Person;

 (cc)     all obligations, contingent or otherwise, of such
Person in connection with letters of credit, whether or not drawn, including, without limitation, any reimbursement obligation, and bankers' acceptances issued for the account of such Person;
 (dd)     all cash obligations of any such Person to redeem, repurchase, exchange, defease or otherwise make payments in
respect of Capital Stock of such Person, unless such redemption, repurchase, exchange, defeasance or other payment is contingent (unless such contingency has been satisfied) or is not required prior to the date that is ninety-one (91) days after the
Maturity Date;
 
	  
	 (ee)
	 all Net
Hedging Obligations of such Person; and

 (ff)      the outstanding attributed
principal amount under any asset securitization program of such Person.
  
  
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 For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture
that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Person is not legally liable therefor under Applicable Law or as a result of any legally enforceable contractual
limitation with respect to such Indebtedness.
 "Indemnified Taxes" means Taxes and Other
Taxes other than Excluded Taxes.
 "Insurance and Condemnation Event" means the receipt by
the U.S. Borrower or any of its Subsidiaries of any cash insurance proceeds or condemnation award payable by reason of theft, loss, physical destruction or damage, taking or similar event with respect to any of their respective property or assets.

 "Intercompany Subordination Agreement" means an Intercompany Subordination Agreement
substantially in the form of Exhibit J by and among the Administrative Agent and the applicable Credit Parties or Subsidiaries thereof party thereto.
 "Interest Period" has the meaning assigned thereto in Section 4.1(b).
 "Interest Rate Contract" means any interest rate swap agreement, interest rate cap agreement, interest
rate floor agreement, interest rate collar agreement, interest rate option or any other agreement regarding the hedging of interest rate risk exposure executed in connection with hedging the interest rate exposure of any Person and any confirming
letter executed pursuant to such agreement, all as amended, restated, supplemented or otherwise modified from time to time.
 "Inventory" has the meaning specified in Section 1.1 of the Collateral Agreement.
 "ISP98" means the International Standby Practices (1998 Revision, effective January 1, 1999),
International Chamber of Commerce Publication No. 590.
 "Issuing Lender" means (a) with
respect to Letters of Credit issued hereunder on or after the Closing Date, The Bank of Nova Scotia, in its capacity as issuer thereof, or any successor thereto or any other Lender designated as an Issuing Lender by the Borrower (with reasonable
prior notice of such designation by the Borrower to the Administrative Agent) and (b) with respect to the Existing Letters of Credit, the issuers thereof as identified on Schedule 1.1(a).
 "ITA" means the Income Tax Act (Canada), as amended or modified from time to time.
 "Korean Fixed Assets" means the Fixed Assets owned by the Borrower or any of its Subsidiaries and
located in Mokpo, South Korea.
 "Korean Shares" means all present and future outstanding
Capital Stock issued by Bowater-Korea Co., Ltd.
 "L/C Commitment" means the lesser of (a)
Fifty Million Dollars ($50,000,000) and (b) the aggregate Commitments of the Lenders.
 "L/C
Facility" means the letter of credit facility established pursuant to Article III.
  
  
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 "L/C Obligations" means at any time, an amount equal to the sum of (a) the aggregate undrawn and
unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit which have not then been reimbursed pursuant to Section 3.5.
 "L/C Participants" means the collective reference to all of the Lenders other than the applicable
Issuing Lender.
 "L/C Supporting Documentation" has the meaning assigned thereto in
Section 3.2.
 "Lender" means each Person that is bound by the terms of this Agreement as a
Lender (including, without limitation, each Issuing Lender and the Swingline Lender unless the context otherwise requires) and each Person that hereafter becomes a party to this Agreement as a Lender pursuant to Section 14.10.
 "Lending Office" means, with respect to any Lender, the office or branch of such Lender maintaining
such Lender's Extensions of Credit.
 "Letter of Credit Application" means an application,
in the form specified by the applicable Issuing Lender from time to time, requesting the applicable Issuing Lender to issue a Letter of Credit.
 "Letters of Credit" means the collective reference to letters of credit issued pursuant to Section 3.1 and the Existing Letters of Credit.
 "LIBOR" means the rate of interest per annum determined on the basis of the rate for deposits in the
applicable Permitted Currency in minimum amounts of at least $5,000,000 (with respect to Revolving Credit Loans denominated in Dollars) or C$5,000,000 (with respect to Revolving Credit Loans denominated in Canadian Dollars) for a period equal to the
applicable Interest Period which appears on the Reuters Page LIBOR01 (or any successor page) at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of the applicable Interest Period (rounded upward, if necessary, to
the nearest 1/100th of 1%). If, for any reason, such rate does not appear on Reuters Page LIBOR01 (or any successor page), then "LIBOR" shall be determined by the Administrative Agent to be the arithmetic average of the rate per annum at
which deposits in the applicable Permitted Currency in minimum amounts of at least $5,000,000 (with respect to Revolving Credit Loans denominated in Dollars) or C$5,000,000 (with respect to Revolving Credit Loans denominated in Canadian Dollars)
would be offered by first class banks in the London interbank market to the Administrative Agent at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of the applicable Interest Period for a period equal to such
Interest Period. Each calculation by the Administrative Agent of LIBOR shall be conclusive and binding for all purposes, absent manifest error.
 "LIBOR Rate" means the rate per annum (rounded upwards, if necessary, to the next higher 1/100th of 1%) equal to LIBOR. Each calculation by the Administrative Agent of the LIBOR Rate shall be
conclusive and binding for all purposes, absent manifest error.
  
  
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 "LIBOR Rate Loan" means any Loan bearing interest at a rate based upon the LIBOR Rate as provided in
Section 4.1(a).
 "Lien" means, with respect to any asset, any mortgage, leasehold
mortgage, lien, pledge, charge, security interest, hypothec, hypothecation, assignment by way of security or encumbrance of any kind in respect of such asset. For the purposes of this Agreement, a Person shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease or other title retention agreement relating to such asset.
 "Loan Documents" means, collectively, this Agreement, each Note, the Letter of Credit Applications, the
Security Documents, the Intercompany Subordination Agreement, and each other document, instrument, certificate and agreement executed and delivered by the Parent, the U.S. Borrower or any of their respective Subsidiaries in connection with this
Agreement or otherwise referred to herein or contemplated hereby (excluding any Hedging Agreement and any agreements with respect to any Cash Management Arrangement), all as may be amended, restated, supplemented or otherwise modified from time to
time.
 "Loans" means the collective reference to the Revolving Credit Loans and the
Swingline Loans, and "Loan" means any of such Loans.
 "Material Adverse Effect" means,
with respect to the U.S. Borrower or any of its Subsidiaries, a material adverse effect on (a) the business, assets, liabilities (actual or contingent), operations or condition (financial or otherwise) of the U.S. Borrower and its Subsidiaries,
taken as a whole, or (b) the ability of any such Person to perform its obligations under the Loan Documents to which it is a party.
 "
Material Subsidiary" means:
 (gg)     each Domestic Subsidiary of
the Borrower, other than the Immaterial Subsidiaries; and
 (hh)     each Domestic Subsidiary that,
notwithstanding the definition of Immaterial Subsidiary, is designated as a Material Subsidiary pursuant to Section 8.10(a)(ii).
 Notwithstanding anything to the contrary contained in this Agreement or any other Loan Document, any Domestic Subsidiary that (i) owns a Material
Subsidiary or (ii) provides a guaranty of (A) the Existing Notes, (B) any Indebtedness incurred to refinance, refund, renew or extend the Existing Notes as permitted pursuant to Section 10.1(d) or (C) any Indebtedness permitted pursuant to Section
12.1(o)(viii), in each case, shall be a Material Subsidiary.
 "Maturity Date" means the
earliest of the dates referred to in Section 2.6 (subject to the extension provisions thereof).
 "Moody's" means Moody's Investors Service, Inc. and any successor thereto.
 "Multiemployer Plan" means a "multiemployer plan" as defined in Section 4001(a)(3) of ERISA to which the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates is
  

  
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 making, or is accruing an obligation to make, or has accrued an obligation to make contributions within the preceding six (6) years.
 "Net Cash Proceeds" means, as applicable;
 (ii)       with respect to any Asset Disposition, the gross cash proceeds received by the U.S. Borrower or any of
its Subsidiaries therefrom less the sum of the following, without duplication, (i) selling expenses incurred in connection with such Asset Disposition (including reasonable brokers' fees and
commissions, legal, accounting and other professional and transactional fees, transfer and similar taxes and the Original U.S. Borrower's reasonable good faith estimate of income taxes paid or payable in connection with such sale), (ii) reasonable
reserves with respect to post-closing adjustments, indemnities and other contingent liabilities established in connection with such Asset Disposition (provided that, to the extent and at the time any
such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds), (iii) subject to Section 8.2(b), the principal amount, premium or penalty, if any, interest and other
amounts on any Indebtedness secured by a Lien on the assets (or a portion thereof) sold in such Asset Disposition, which Indebtedness is repaid with such proceeds and (iv) the Original U.S. Borrower's reasonable good faith estimate of cash payments
required to be made within ninety (90) days of such Asset Disposition with respect to retained liabilities directly related to the assets (or a portion thereof) sold in such Asset Disposition (provided that, to the extent that cash proceeds are not used to make payments in respect of such retained liabilities within ninety (90) days of such Asset Disposition, such cash proceeds shall constitute Net Cash Proceeds);
 (jj)       with respect to any Insurance and Condemnation Event, the gross cash proceeds received by the U.S.
Borrower or any of its Subsidiaries therefrom less the sum of the following, without duplication, (i) all fees and expenses in connection therewith and (ii) subject to Section
8.2(b), the principal amount, premium or penalty, if any, interest and other amounts on any Indebtedness secured by a Lien on the assets (or a portion thereof) subject to such Insurance and Condemnation Event, which
Indebtedness is repaid in connection therewith; and
 (kk)     with respect to any Debt Issuance, the gross cash
proceeds received by the U.S. Borrower or any of its Subsidiaries therefrom less all legal, underwriting and other fees and expenses incurred in connection therewith.
 "Net Hedging Obligations" means, with respect to any Hedging Agreement as of any date, the Termination
Value of such Hedging Agreement on such date.
 "Net Recovery Percentage" means, at any
time, the fraction, expressed as a percentage, (a) the numerator of which is the amount equal to the recovery in respect of Eligible Inventory at such time on a net orderly liquidation value basis as set forth in the most recent acceptable appraisal
of Eligible Inventory received by the Administrative Agent, net of operating expenses, liquidation expenses and commissions, and (b) the denominator of which is the applicable original Value of the aggregate amount of the Inventory subject to such
appraisal.
 "New U.S. Borrowers" has the meaning set forth in the introductory paragraph.

  
  
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 "New U.S.
Borrower Fixed Assets" means, collectively, the New U.S. Borrower Mill Assets and any and all other real property and equipment owned or thereafter acquired by any New U.S. Borrower or in which any New U.S. Borrower has or at
any time in the future may acquire any right, title or interest, and wherever located or deemed located to the extent related to or forming a part of the New U.S. Borrower Mill Assets; provided, that in
no event shall the New U.S. Borrower Fixed Assets include any U.S. Coverage Assets.
 "New U.S. Borrower Mill
Assets" means, collectively:
 (ll)       (i)        that certain mill owned as of the Fourth Amendment Effective Date by Bowater Alabama, Inc., a Subsidiary of the Original U.S. Borrower, and
located in Coosa Pines, Alabama (the "Coosa Pines Mill"), along with the real property upon which the Coosa Pines Mill is situated (as more particularly described on Schedule
1.1(c) hereto, the "Coosa Pines Mill Real Property");
 (ii)       all equipment used in connection with the Coosa Pines Mill and located at the Coosa Pines
Mill Real Property (the "Coosa Pines Mill Equipment"); and
 (iii)
     all other rights and assets used for the operation, administration and maintenance of the Coosa Pines Mill Real Property;
 (mm)   (i)        that certain mill owned (directly or beneficially) as of the Fourth Amendment
Effective Date by a Subsidiary of the Original U.S. Borrower, and located in Grenada, Mississippi (the "Grenada Mill"), along with the real property upon which the Grenada Mill is situated (as more
particularly described on Schedule 1.1(c) hereto, the "Grenada Mill Real Property");
 (ii)       all equipment used in connection with the Grenada Mill and located at the Grenada
Mill Real Property (the "Grenada Mill Equipment"); and
 (iii)       all other rights and assets used for the operation, administration and maintenance of the Grenada Mill Real Property; and
 
	  
	 (nn)
	 all
operations of the foregoing.

 "New U.S. Borrower Mortgages" means
those certain mortgages, deeds of trust, security agreements, subordination agreements or other real property security documents encumbering the New U.S. Borrower Fixed Assets executed by the applicable New U.S. Borrower in favor of the U.S.
Administrative Agent, for the ratable benefit of the Secured Parties and the U.S. Secured Parties, as amended, restated, supplemented or otherwise modified from time to time in form and substance reasonably satisfactory to the Administrative Agent
and the U.S. Administrative Agent.
 "New U.S. Borrower Notes" has the meaning assigned
thereto in Section 10.5(h).
 "New U.S. Borrower Transactions" means the transfer of the
Capital Stock of each New U.S. Borrower from the Original U.S. Borrower to the Parent in exchange for the New U.S.
  
  
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 Borrower Notes, in each case, to the extent permitted pursuant to, and in accordance with the terms of, this Agreement and the U.S. Credit Agreement.
 "New Material Subsidiary" has the meaning assigned thereto in Section 8.10.
 "Non-BA Lender" means a Lender that cannot or does not as a matter of policy accept or purchase
Bankers' Acceptances.
 "Non-Consenting Lender" has the meaning assigned thereto in Section
2.6.
 "Non-Fixed Assets Collateral" means any portion of the Collateral that consists of
assets or property that are not Fixed Assets or timberlands.
 "Notes" means the collective
reference to the Revolving Credit Notes, the Swingline Note and the Discount Notes.
 "Notice of Account
Designation" has the meaning assigned thereto in Section 2.3(b).
 "Notice of Borrowing" has the meaning assigned thereto in Section 2.3(a).
 "Notice of Conversion/Continuation" has the meaning assigned thereto in Section 4.2.
 "Notice of Prepayment" has the meaning assigned thereto in Section
2.4(c).
 "Obligations" means, in each case, whether now in
existence or hereafter arising: (a) the principal of and interest on (including interest accruing after the filing of any bankruptcy or similar petition) the Loans, (b) the L/C Obligations, (c) all Hedging Obligations, (d) all obligations owing by
any Credit Party (other than the U.S. Borrower) under any Cash Management Arrangement and (e) all other fees and commissions (including reasonable attorneys' fees), charges, indebtedness, loans, liabilities, financial accommodations, obligations,
covenants and duties owing by the U.S. Borrower, the Borrower or any of their respective Subsidiaries to the Lenders or the Administrative Agent, in each case under any Loan Document, with respect to any Loan or Letter of Credit, of every kind,
nature and description, direct or indirect, absolute or contingent, due or to become due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any note.
 "OFAC" means the U.S. Department of the Treasury's Office of Foreign Assets Control.
 "Officer's Compliance Certificate" means a certificate of the chief financial officer, the treasurer or
the assistant treasurer of each of the Borrower and the Original U.S. Borrower substantially in the form of Exhibit F.
 "Operating Lease" means, as to any Person as determined in accordance with GAAP, any lease of property
(whether real, personal or mixed) by such Person as lessee which is not a Capital Lease.
 "Original U.S. Borrower
" has the meaning assigned thereto in the introductory paragraph hereto.
  
  
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 "Other Taxes" means all present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.
 "Overadvance Amount" means, as of the Tenth Amendment Effective Date, $75,000,000; provided, that, unless waived or extended by the Required Agreement Lenders, such Overadvance Amount shall be reduced in monthly installments on each of the dates set forth below in the amounts set forth below such
that the remaining Overadvance Amount is set forth opposite the applicable reduction date set below:
  
 
	 Overadvance Amount Reduction Date
	
Reduction Amount
	
Remaining Overadvance Amount

	
December 31, 2008
	 $2,572,707
	 $72,427,293

	
January 31, 2009
	 $2,572,707
	 $69,854,586

	
February 28, 2009
	 $3,859,060
	 $65,995,526

	
March 31, 2009
	 $3,859,060
	 $62,136,466

	
Conversion Date
	 $62,136,466
	 $0

  
 provided further, that the Overadvance Amount shall be further reduced on the date of delivery of the certificate
delivered pursuant to Section 8.10(f)(i)(J) by an amount equal to the difference (based on the Dollar Amount) between (a) C$70,000,000 less (b) the
Permitted Secured Indebtedness (it being understood and agreed that such reduction shall be applied to reduce the remaining scheduled reductions of the Overadvance Amount set forth above in inverse order of such remaining scheduled
reductions).
  
 "Parent" means AbitibiBowater Inc., a Delaware corporation f/k/a Alpha-Bravo Holdings, Inc.
 "Parent Guarantor" means (a) the U.S. Borrower, as guarantor pursuant to Article XI hereof, and (b) each other direct or indirect parent company of the Borrower that (i) has previously provided a
guaranty of the Obligations or (ii) hereafter becomes a guarantor pursuant to Section 8.10(c).
 "Parent Guaranty
Agreements" means each unconditional guaranty agreement executed by the Parent Guarantors in favor of the Administrative Agent for the ratable benefit of the Secured Parties, as amended, restated, supplemented or otherwise
modified from time to time.
 "Parent Overhead Expenses" means (a) accounting and auditing
costs and expenses incurred by the Parent in the ordinary course of its business in connection with preparing financial reports and tax filings; (b) customary fees and expenses payable to the SEC and other reasonable and customary costs and expenses
payable in connection with the Parent being a publicly traded company (including, without limitation, reasonable and customary fees and
  
  
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 expenses required to be paid for professional and regulatory compliance); (c) reasonable and customary legal fees and expenses required for the corporate maintenance of
the Parent and the U.S. Borrower and its Subsidiaries; (d) reasonable and customary director fees; (e) reasonable and customary costs and expenses payable for director and officer insurance; (f) transfer agent fees payable in connection with Capital
Stock of the Parent; and (g) franchise taxes and other fees payable to the jurisdiction of incorporation or qualification of the Parent incurred in the ordinary course of conducting its business; provided that in no event shall Parent Overhead Expenses include management fees, salaries, bonuses, debt service and dividends and other distributions in respect of the Capital Stock of the Parent.
 "Participant" has the meaning assigned thereto in Section 14.10(d).
 "Participating Member State" means each state so described in any EMU Legislation.
 "PBGC" means the Pension Benefit Guaranty Corporation or any successor agency.
 "Pension Plan" means any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to
the provisions of Title IV of ERISA or Section 412 of the Code and which (a) is maintained for the employees of the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates or (b) has at any time within the preceding six (6) years
been maintained for the employees of the U.S. Borrower or any of its Subsidiaries or any of their current or former ERISA Affiliates which the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates sponsors, maintains, or to which
it makes, is making or is obligated to make, contributions.
 "Permitted Acquisition" means
any investment by the U.S. Borrower or any of its Subsidiaries in the form of the acquisition of all or substantially all of the business or assets, or any portion of the business or assets that constitutes a line of business, a business unit or a
division (whether by the acquisition of Capital Stock, assets or any combination thereof), of any other Person (which acquisition (a) was permitted prior to the Tenth Amendment Effective Date or (b) is permitted on or after the Tenth Amendment
Effective Date if consented to by the Required Lenders pursuant to Section 14.2).
 "Permitted Currency" means Dollars and Canadian Dollars or each such currency, as the context requires.
 "Permitted Liens" means the Liens permitted pursuant to Section 10.2.
 "Permitted Secured Indebtedness" has the meaning set forth in Section
8.10(f)(i)(J).
 "Person" means any natural person, corporation,
limited liability company, trust, joint venture, association, company, partnership, governmental authority or other entity.
 "Policy Sublimit" means the maximum Dollar amount of the Credit Insurance Policy against which claims may be made only by the U.S. Borrower or any of its Subsidiaries (and not by Abitibi, the
Parent or any other Subsidiary thereof).
  
  
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 "Pounds
Sterling" means, at any time of determination, the then official currency of the United Kingdom.
 "PPSA" means the Personal Property Security Act as in effect in the provinces of Ontario, Nova Scotia and New Brunswick, as amended or modified from time to time.
 "Prime Rate" means,
 (oo)     with respect to all Revolving Credit Loans denominated in Dollars, at any time, the rate of interest per annum
publicly announced from time to time by the Administrative Agent as its prime rate for Dollar commercial loans made in Canada; and
 (pp)     with respect to all Swingline Loans denominated in Dollars, at any time, the rate of interest per annum publicly announced from time to time by the Swingline Lender as its prime rate for Dollar commercial
loans made in Canada.
 Each change in the Prime Rate shall be effective as of the opening of business on the day such change in such
prime rate occurs. The parties hereto acknowledge that the rate announced publicly by the Administrative Agent or the Swingline Lender, as applicable, as its prime rate is an index or base rate and shall not necessarily be its lowest or best rate
charged to its customers or other banks.
 "Priority Payables" means, with respect to any
Person, any amount payable by such Person which is secured by a Lien in favour of a Governmental Authority which, in the reasonable good faith credit discretion of the Administrative Agent, ranks or is capable of ranking prior to or pari passu with
the Liens created by the Security Documents in respect of any Eligible Accounts or Eligible Inventory, including amounts owing for wages, vacation pay, severance pay, employee deductions, sales tax, excise tax, Taxes payable pursuant to the Excise
Tax Act (net of GST input credits), income tax, workers compensation, government royalties, pension fund obligations including Canadian Pension Plans, real property tax and other statutory or other claims that have or may have priority over, or
rank pari passu with, such Liens created by the Security Documents.
 "QSPE" means each of the following: (a) Calhoun Note Holdings AT LLC, (b) Calhoun Note Holdings TI LLC, (c) Bowater Catawba Note Holdings I LLC, (d) Bowater Catawba Note Holdings II LLC, (e) Bowater Saluda Note Holdings
LLC, (f) Timber Note Holding LLC and (g) any other qualified special purpose entity created to facilitate the sale and/or the monetization of receivables from the sale of timberlands pursuant to Section 10.5(g); provided that:
 (i)        no portion of the
Indebtedness or any other obligations (contingent or otherwise) of any such Person (1) may be guaranteed by the U.S. Borrower or any of its Subsidiaries, (2) may be recourse to or obligate the U.S. Borrower or any of its Subsidiaries in any way or
(3) may subject any property or asset of the U.S. Borrower or any of its Subsidiaries, directly or indirectly, contingently or otherwise, to the satisfaction thereof (other than, in the case of clauses (1) (solely with respect to guaranties of make
whole premiums), (2) and (3), pursuant to Standard Securitization Undertakings);
  
  
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 (ii)       the U.S. Borrower and its Subsidiaries may not have any material contract,
agreement, arrangement or understanding with any such Person other than on terms no less favorable to the U.S. Borrower or any of its Subsidiaries than those that might be obtained at the time from Persons that are not Affiliates of the U.S.
Borrower or any of its Subsidiaries; and
 (iii)      the U.S. Borrower and its
Subsidiaries may not (A) have any obligation to maintain or preserve the financial condition of any such Person or (B) cause any such Person to achieve certain levels of operating results.
 "Québec Collateral Documents" means, collectively, any Deed of Hypothec, Debenture and Pledge
referred to in Section 13.1(b).
 "Reallocation Period" means any period (a) commencing
upon the date on which the Loans are reallocated in accordance with Section 4.6(b)(i)(A)(1) and (b) ending on the date on which (i) the Default or Event of Default which gave rise to the
reallocation noted in clause (a) above has been cured or waived and (ii) the Loans have been reallocated in accordance with Section 4.6(b)(i)(B).

 "Register" has the meaning assigned thereto in Section 14.10(c).
 "Reimbursement Obligation" means the obligation of the Borrower to reimburse the applicable Issuing
Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit.
 "Related Parties" means, with respect to any Person, such Person's Affiliates and the directors, officers, employees, agents and advisors of such Person and of such Person's Affiliates.
 "Required Agreement Lenders" means, at any date, any combination of Lenders having more than fifty
percent (50%) of the sum of the aggregate amount of the Commitment under this Credit Facility or, if the Commitment under this Credit Facility has been terminated, any combination of Lenders holding more than fifty percent (50%) of the aggregate
Extensions of Credit.
 "Required Lenders" means, at any date, any combination of Lenders
and U.S. Lenders having more than fifty percent (50%) of the sum of (a) the aggregate amount of the Commitment under this Credit Facility (or if the Commitment has been terminated, the aggregate amount of Extensions of Credit under this Credit
Facility) plus (b) the aggregate amount of the commitments under the U.S. Credit Facility (or, if the commitments under the U.S. Credit Facility have been terminated, the aggregate amount of the U.S.
Extensions of Credit).
 "Reserves" means, as of any date of determination, such amounts as
the Administrative Agent may from time to time establish and revise in good faith reducing the amount of the Extensions of Credit which would otherwise be available to the Borrower under the lending formulas provided herein: (a) to reflect events,
conditions, contingencies or risks which, as determined by the Administrative Agent in good faith, adversely affect, or would have a reasonable likelihood of adversely affecting, either (i) the Collateral or any other property which is security for
the Obligations, its value or the amount that might be received by the
  
  
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 Administrative Agent from the sale or other disposition or realization upon the Collateral, or (ii) the assets, business or prospects of the Borrower or any of its
Consolidated Subsidiaries or (iii) the security interests and other rights of the Administrative Agent or any Lender in the Collateral (including the enforceability, perfection and priority thereof) or (b) to reflect the Administrative Agent's good
faith belief that any collateral report or financial information furnished by or on behalf of the Borrower or any of its Consolidated Subsidiaries to the Administrative Agent is or may have been incomplete, inaccurate or misleading in any material
respect or (c) in respect of any state of facts which the Administrative Agent determines in good faith constitutes a Default or an Event of Default. Without limiting the generality of the foregoing, Reserves may, at the Administrative Agent's
option, be established (i) to reflect environmental liabilities and (ii) to reflect up to the average balance for the applicable Settlement Period of commingled accounts receivable owed by account debtors to the U.S. Borrower and its Subsidiaries
but paid to Abitibi or any of its Subsidiaries net of the average balance for such applicable Settlement Period of commingled accounts receivable owed by account debtors to Abitibi and its Subsidiaries but paid to the U.S. Borrower or any of its
Subsidiaries. To the extent that the Administrative Agent may revise the lending formulas used to determine the Borrowing Base or establish new criteria or revise existing criteria so as to address any circumstances, condition, event or contingency
in any manner satisfactory to the Administrative Agent, the Administrative Agent shall not establish a Reserve for the same purpose. The amount of any Reserve established by the Administrative Agent shall have a reasonable relationship to the event,
condition, or other matter which is the basis for the Reserve as determined by the Administrative Agent in good faith.
  
 "Responsible Officer" means, as to any Person, the chief executive officer, president, chief financial
officer, controller, treasurer or assistant treasurer of such Person or any other officer of such Person reasonably acceptable to the Administrative Agent and the U.S. Administrative Agent. Any document delivered hereunder that is signed by a
Responsible Officer of a Person shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Person and such Responsible Officer shall be conclusively presumed to have acted
on behalf of such Person.
  
 "Restricted Subsidiary" means any Person that is a "Restricted Subsidiary" pursuant to the definition thereof as contained in the Existing Notes as in effect as of the Closing Date, for so long
as such Existing Notes or any Indebtedness incurred to refinance such Existing Notes is outstanding and includes provisions restricting the granting of a lien on the capital stock or indebtedness of such Restricted Subsidiaries.
  
 "
Revolving Credit Commitment" means:
 (a)       as to
any Lender (other than the Swingline Lender) at any time, the amount of the Commitment of such Lender; and
 (b)       as to the Swingline Lender (i) at any time during a Reallocation Period, the amount of the Commitment of the Swingline Lender and (ii) at any other time, the difference between (A) the amount of
the Commitment of the Swingline Lender less (B) the amount of the Swingline Commitment.
  
 "Revolving Credit Commitment Percentage" means, as to any Lender at any time, the

  
  
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 ratio of (a) the amount of the
Revolving Credit Commitment of such Lender to (b) the total amount of the Revolving Credit Commitments of all the Lenders.
 "Revolving Credit Facility" means the revolving credit facility established pursuant to Article II.
 "Revolving Credit Loan" means (i) any revolving loan made to the Borrower pursuant to Section 2.1, (b) any BA Loan made to the Borrower pursuant to Section 2.7 and (c) all such revolving loans collectively as the context requires.
 "Revolving Credit Note" means a promissory note made by the Borrower in favor of a Lender evidencing
the Revolving Credit Loans (other than BA Loans) made by such Lender, substantially in the form of Exhibit A-1, and any amendments, supplements and modifications thereto, any substitutes therefor, and
any replacements, restatements, renewals or extension thereof, in whole or in part.
 "S&P" means Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto.
 "SEC" means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.
 "Sanctioned Entity" shall mean (a) an agency of the government of, (b) an organization directly or
indirectly controlled by, or (c) a person resident in a country that is subject to a sanctions program identified on the list maintained by OFAC and available at http://www.treas.gov/offices/enforcement/ofac/sanctions/index.html, or as otherwise published from time to time as such program may be applicable to such agency, organization or person.
 "Sanctioned Person" shall mean a person named on the list of Specially Designated Nationals or Blocked
Persons maintained by OFAC available at http://www.treas.gov/offices/
 enforcement/ofac/sdn/index.html,
or as otherwise published from time to time.
 "Schedule I Lender" means any Lender named
on Schedule I to the Bank Act (Canada).
 "Schedule I Reference
Banks" means any bank or banks named on Schedule I to the Bank Act (Canada) as may be agreed from time to time by the Administrative Agent and the Borrower.
 "Schedule II or III Lender" means any Lender named on Schedule II or Schedule III to the
Bank Act (Canada).
 "Schedule II or III Reference Banks" means any bank named on Schedule II or Schedule III to the Bank Act (Canada) as may be agreed from time to time by the Administrative Agent and the Borrower.
 "Secured Parties" means the Administrative Agent, the Lenders, any party to a Hedging Agreement that
was a Lender or an Affiliate of a Lender at the time such Hedging Agreement
  
  
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 was executed, and any counterparty to any Cash Management Arrangement that was a Lender or an Affiliate of a Lender at the time such Cash Management Arrangement was
executed.
 "Security Documents" means the collective reference to the Collateral
Agreement, the Québec Collateral Documents, the Guaranty Agreements, the New U.S. Borrower Mortgages, the Canadian Fixed Asset Mortgages and each other agreement or writing pursuant to which any Credit Party purports to pledge or grant a
security interest in any property or assets securing the Obligations or any such Person purports to guaranty the payment and/or performance of the Obligations, in each case, as amended, restated, supplemented or otherwise modified from time to time.

 "Settlement Period" means the time period within which commingled accounts receivable
owed by account debtors to the U.S. Borrower and its Subsidiaries, on the one hand, and Abitibi and its Subsidiaries, on the other hand, are settled between the U.S. Borrower and Abitibi.
 "Seventh Amendment" means that certain Seventh Amendment dated as of June 6, 2008 by and among the
Borrower, the Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto).
 "Seventh Amendment Effective Date" means June 6, 2008.
 "Significant
Indebtedness" means Indebtedness (other than the Obligations and the U.S. Obligations) of the U.S. Borrower and its Subsidiaries the outstanding principal amount of which is in excess of $25,000,000.
 "Sixth Amendment" means that certain Sixth Amendment dated as of May 28, 2008 by and among the
Borrower, the Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto).
 "Sixth
Amendment Effective Date" means May 28, 2008.
 "Solvent" means, as
to the U.S. Borrower and its Subsidiaries on a particular date, that any such Person (a) has capital sufficient to carry on its business and transactions and all business and transactions in which it is about to engage and is able to pay its debts
as they mature, (b) has assets having a value, both at fair valuation and at present fair saleable value, greater than the amount required to pay its probable liabilities (including contingencies), and (c) does not believe that it will incur
debts or liabilities beyond its ability to pay such debts or liabilities as they mature.
 "Special Agent Advances
" shall have the meaning set forth in Section 13.11 hereof.
 "
Specified Abitibi Indebtedness" means Indebtedness of Abitibi evidenced by the Credit and Guaranty Agreement dated as of April 1, 2008 by and among Abitibi-Consolidated Company of Canada, Abitibi and
certain affiliates and subsidiaries thereof, the lenders party thereto and Goldman Sachs Credit Partners L.P., as administrative agent (as amended, restated, supplemented or otherwise modified).
  

  
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 "Specified Existing Notes" means each of the Existing Notes which (a) as of the Closing Date, matures
or is subject to mandatory redemption prior to May 25, 2011 and (b) has an outstanding principal amount, as of the Closing Date, in excess of $75,000,000. The Specified Existing Notes shall be set forth on Schedule
1.1(b).
 "Specified Non-Recurring Charges" means the non-recurring
charges against income taken by the Original U.S. Borrower during the following periods in the following amounts:
 (qq)     with respect to the fiscal quarter ended March 31, 2007, non-recurring charges in the amount of $9,500,000;
 (rr)      with respect to the fiscal quarter ended June 30, 2007, non-recurring charges in the amount of $20,000,000;

 (ss)      with respect to the fiscal quarter ended September 30, 2007, non-recurring charges in the
amount of $46,000,000;
 (tt)       with respect to the fiscal quarter ending December 31, 2007,
non-recurring charges consisting of the following, without duplication, (i) severance expenses of the Original U.S. Borrower, (ii) merger costs incurred with respect to the Combination and (iii) other mill closure costs, in each case, taken during
such quarter, in an aggregate amount to be determined in accordance with GAAP, but not to exceed $100,000,000; and
 (uu)     with respect to the fiscal quarter ending March 31, 2008, non-recurring charges consisting of the following, without duplication, (i) severance expenses of the Original U.S. Borrower, (ii) merger costs
incurred with respect to the Combination and (iii) other mill closure costs, in each case, taken during such quarter, in an aggregate amount to be determined in accordance with GAAP, but not to exceed $100,000,000 less the amount of Specified Non-Recurring Charges taken pursuant to clause (d) above with respect to the fiscal quarter ended December 31, 2007;
 provided that, notwithstanding anything to the contrary contained in this Agreement or any other Loan Document, for
purposes of calculating the Consolidated Senior Secured Leverage Ratio and the interest coverage ratio as set forth in Section 9.2, such non-recurring charges shall be excluded from the non-recurring charges included in clause (b)(v) of the
definition of Consolidated EBITDA.
 "Stamping Fee" has the meaning assigned thereto in
 Section 2.7(k).
 "Standard Securitization
Undertakings" means, collectively, (i) customary arms-length servicing obligations (together with any related performance guaranties), (ii) obligations (together with any related performance guaranties) to refund the purchase
price or grant purchase price credits for dilutive events or misrepresentation (in each case unrelated to the collectibility of receivables or creditworthiness of the associated account debtors), (iii) representations, warranties, covenants and
indemnities (together with any related performance guaranties) of a type that are reasonably customary in accounts receivable securitizations and (iv) in the case of a QSPE, a guarantee by the U.S. Borrower or its Subsidiaries of any make whole
premium (but not any principal or interest) on Indebtedness of such QSPE.
  
  
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 "Subordinated Indebtedness" means the collective reference to any Indebtedness of the U.S. Borrower or
any of its Subsidiaries subordinated in right and time of payment to the Obligations and containing such other terms and conditions, in each case as are satisfactory to the Administrative Agent and the U.S. Administrative Agent.
 "Subsidiary" means as to any Person, any corporation, partnership, limited liability company or other
entity of which more than fifty percent (50%) of the outstanding Capital Stock having ordinary voting power to elect a majority of the board of directors or other persons or governing body performing similar functions of such corporation,
partnership, limited liability company or other entity is at the time directly or indirectly owned or controlled by such Person and/or one or more Subsidiaries of such Person (irrespective of whether, at the time, Capital Stock of any other class or
classes of such corporation, partnership, limited liability company or other entity shall have or might have voting power by reason of the happening of any contingency); provided, however,
notwithstanding the foregoing, the terms "Subsidiary" or "Subsidiaries":
 (vv)     shall include (i) all
Subsidiaries of the Original U.S. Borrower (other than those noted in clause (b) below) and (ii) all Subsidiaries of each New U.S. Borrower; and
 
	  
	 (ww)
	 shall exclude
(i) all QSPEs and (ii) all of the Abitibi Entities.

 Unless otherwise qualified, references to "Subsidiary" or "Subsidiaries" herein
shall refer to those of the U.S. Borrower.
 "Subsidiary Borrower" means any Domestic
Subsidiary of the Borrower that is designated as a borrower under this agreement in accordance with the terms of Section 4.14.
 "Subsidiary Guarantors" means each direct or indirect Material Subsidiary of the Borrower which becomes a party to the Subsidiary Guaranty Agreement in accordance with Section 8.10(a).

"Subsidiary Guaranty Agreement" means each unconditional guaranty agreement executed by the
Subsidiary Guarantors in favor of the Administrative Agent for the ratable benefit of the Secured Parties, substantially in the form of Exhibit H, as amended, restated, supplemented or otherwise
modified from time to time.
 "Supplemental New U.S. Borrower Mortgage" means that certain
Agreement of Subordination and Attornment, dated as of May 15, 2008, executed by The Industrial Development Board of the City of Childersburg, a public corporation duly organized and existing under the laws of the State of Alabama (such Person,
the "Coosa Pines IDB"), in the Coosa Pines Mill or Coosa Pines Real Property to the interests of the Administrative Agent and the U.S. Administrative Agent therein, executed by the Coosa Pines IDB in
favor of the U.S. Administrative Agent, for the ratable benefit of the Secured Parties and the U.S. Secured Parties, as amended, restated, supplemented or otherwise modified from time to time.
 "Swingline Commitment" means the lesser of (a) Ten Million Dollars ($10,000,000)and (b) the Commitment.

  
  
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 "Swingline
Facility" means the swingline facility established pursuant to Section 2.2.
 "Swingline Lender" means Bank of Montreal in its capacity as swingline lender hereunder.
 "Swingline Loan" means any swingline loan made by the Swingline Lender to the Borrower pursuant
to Section 2.2, and all such swingline loans collectively as the context requires.
 "Swingline Note" means a promissory note made by the Borrower in favor of the Swingline Lender evidencing the Swingline Loans made by the Swingline Lender, substantially in the form of
Exhibit A-2, and any amendments, supplements and modifications thereto, any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.
 "Swingline Termination Date" means the first to occur of (a) the resignation or removal of the
Swingline Lender in accordance with Section 13.10 (except to the extent the Swingline Lender is replaced with a successor Swingline Lender, reasonably acceptable to the Borrower and the Administrative Agent (such approvals not to be unreasonably
withheld or delayed), prior to the effectiveness of such resignation) and (b) the Maturity Date.
 "Synthetic Lease
" means any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing product where such transaction is considered borrowed money indebtedness for tax purposes but is
classified as an Operating Lease in accordance with GAAP.
 "Taxes" means all present or
future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
 "Tenth Amendment" means that certain Tenth Amendment and Waiver dated as of the Tenth Amendment
Effective Date by and among the Borrower, the Parent, the Guarantors and the Administrative Agent (on behalf of itself and the Lenders and the U.S. Lenders party thereto).
 "Tenth Amendment Consenting Lenders" means, collectively, each of the Lenders that consented to the
Tenth Amendment by 5:00 p.m. on November 13, 2008 (together with each such Lender's successors and permitted assignees).
 "Tenth Amendment Effective Date" means November 12, 2008.
 "Termination Event" means except for any such event or condition that could not reasonably be expected to have a Material Adverse Effect: (a) a "Reportable Event" described in Section 4043 of ERISA for which the
notice requirement has not been waived by the PBGC, or (b) the withdrawal of the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates from a Pension Plan during a plan year in which it was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA, or (c) the termination of a Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment as a
  

  
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 termination, under Section 4041 of ERISA or similar provision of other Applicable Law, if the plan assets are not sufficient to pay all plan liabilities, or (d) the
institution of proceedings to terminate, or the appointment of a trustee with respect to, any Pension Plan by the PBGC or any other applicable Governmental Authority under other Applicable Law, or (e) any other event or condition which would
constitute grounds under Section 4042(a) of ERISA or other Applicable Law for the termination of, or the appointment of a trustee to administer, any Pension Plan, or (f) the imposition of a Lien pursuant to Section 412 of the Code or Section 302 of
ERISA or the provisions of any other Applicable Law, or (g) the partial or complete withdrawal of the U.S. Borrower or any of its Subsidiaries or of any of their ERISA Affiliates from a Multiemployer Plan if withdrawal liability is asserted by
such plan, or (h) any event or condition which results in the reorganization or insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or (i) any event or condition which results in the termination of a Multiemployer Plan
under Section 4041A of ERISA or the institution by PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA, or (j) the termination of a Canadian Pension Plan, the filing of a notice of intent to terminate a Canadian Pension
Plan or the treatment of a Canadian Pension Plan amendment as a termination, under Applicable Law, if the plan assets are not sufficient to pay all plan liabilities, or (k) the institution of proceedings to terminate, or the appointment of a trustee
with respect to, any Canadian Pension Plan by any applicable Governmental Authority under Applicable Law, or (l) any other event or condition which would constitute grounds under Applicable Law for the termination of, or the appointment of a trustee
to administer, any Canadian Pension Plan, or (m) the partial or complete withdrawal of the U.S. Borrower or any of its Subsidiaries from a Canadian Multiemployer Plan if withdrawal liability is asserted by such plan, or (n) any event or
condition which results in the reorganization or insolvency of a Canadian Multiemployer Plan, or (o) any event or condition which results in the termination of a Canadian Multiemployer Plan or the institution by any Governmental Authority of
proceedings to terminate a Canadian Multiemployer Plan.
 "Termination Value" means, in
respect of any one or more Hedging Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedging Agreements, (a) for any date on or after the date such Hedging Agreements have been closed out
and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedging Agreements, as
determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedging Agreements (which may include a Lender or any Affiliate of a Lender).
 "Third Amendment" means that certain Third Amendment and Waiver dated as of Third Amendment Effective
Date by and among the Borrower, the Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto).
 "Third Amendment Effective Date" means February 25, 2008.
 "United Kingdom" means the United Kingdom of Great Britain and Northern Ireland.
 "U.S. Administrative Agent" means Wachovia Bank, National Association in its capacity as the administrative agent under the U.S. Credit Agreement.
  

  
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 "U.S. Borrower" means, collectively, the New U.S. Borrowers and the Original U.S. Borrower.

"U.S. Borrower Guaranty" means the unconditional guaranty of the payment of the Obligations of the
Borrower under Article XI of this Agreement.
 "U.S. Borrowing Base" means the "Borrowing
Base" as defined in the U.S. Credit Agreement.
 "U.S. Borrowing Base Certificate" means a
"Borrowing Base Certificate" as defined in the U.S. Credit Agreement.
 "U.S. Borrowing Limit" means the "Borrowing Limit" as defined in the U.S. Credit Agreement.
 "U.S. Collateral" means the "Collateral" as defined in the U.S. Credit Agreement.
 "U.S. Collateral
Agreement" means the "Collateral Agreement" as defined in the U.S. Credit Agreement.
 "U.S. Commitment" means the "Commitment" (as defined in the U.S. Credit Agreement) of all the U.S. Lenders.
 "U.S. Coverage Assets" means the "Coverage Assets" as defined in the U.S. Credit Agreement.
 "U.S. Credit Agreement" means that certain credit agreement dated as of the Closing Date by and among
the U.S. Borrower, as borrower, the lenders party thereto, as lenders, and the U.S. Administrative Agent, as administrative agent.
 "
U.S. Credit Facility" means that certain revolving credit facility established pursuant to the U.S. Credit Agreement.
 "U.S. Credit Party" means the U.S. Borrower and each U.S. Subsidiary Guarantor.
 "U.S. Extensions of Credit" means the "Extensions of Credit" as defined in the U.S. Credit Agreement.

 "U.S. Lender" means any "Lender" as defined in the U.S. Credit Agreement.
 "U.S. Loans" means "Loans" as defined in the U.S. Credit Agreement.
 "U.S. Maturity Date" means the "Maturity Date" as defined in the U.S. Credit Agreement.
 "U.S. Non-Fixed Assets Collateral" means any portion of the U.S. Collateral that consists of assets or
property that are not Fixed Assets or timberlands.
 "U.S. Obligations" means the
"Obligations" as defined in the U.S. Credit Agreement.
  
  

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 "U.S.
Overadvance Amount" means the "Overadvance Amount" as defined in the U.S. Credit Agreement.
 "U.S. Parent Guaranty Agreement" means the "Parent Guaranty Agreement" as defined in the U.S. Credit Agreement.
 "U.S. Pro Rata Percentage" means, as of any date of determination, the percentage obtained by the following formula:
  
 (a)       the
aggregate U.S. Commitment applicable to all U.S. Lenders as of 11:00 a.m. on such date of determination
  
 divided by
  
 (b)       the
sum of (i) the aggregate U.S. Commitment applicable to all U.S. Lenders as of 11:00 a.m. on such date of determination plus (ii) the aggregate Commitment applicable to all Lenders as of 11:00 a.m. on
such date of determination.
 "U.S. Required Agreement Lenders" means the "Required
Agreement Lenders" as defined in the U.S. Credit Agreement.
 "U.S. Secured Parties" means
the "Secured Parties" as defined in the U.S. Credit Agreement.
 "U.S. Subsidiary Guarantors" means the "Subsidiary Guarantors" as defined in the U.S. Credit Agreement.
 "United
States" means the United States of America.
 "Value" means, with
respect to Inventory, the lower of (a) cost computed (i) on a last-in first-out basis in accordance with GAAP in the case of Inventory manufactured at the Original U.S. Borrower's Catawba and Calhoun mills and (ii) on a first-in first-out basis in
accordance with GAAP with respect to all other Inventory or (b) market value; provided that, for purposes of the calculation of the Borrowing Base, (i) the value of the Inventory shall not include: (A)
intercompany profit or (B) write-ups or write-downs in value with respect to currency exchange rates and (ii) notwithstanding anything to the contrary contained in this Agreement, the cost of the Inventory shall be computed in the same manner and
consistent with the most recent appraisal of the Inventory received and accepted by the Administrative Agent.
 "Wholly-Owned" means, with respect to a Subsidiary, that all of the shares of Capital Stock of such Subsidiary are, directly or indirectly, owned or controlled by the U.S. Borrower and/or one or more of its Wholly-Owned
Subsidiaries (except for (a) directors' qualifying shares or other shares required by Applicable Law to be owned by a Person other than the U.S. Borrower and (b) the Exchangeable Shares).
 SECTION 1.2    Other Definitions and Provisions. With reference to this Agreement and each other Loan Document, unless otherwise
specified herein or in such other Loan Document: (a) the definitions of terms herein shall apply equally to the singular and plural
  
  
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 forms of the terms defined, (b) whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms, (c) the words
"include", "includes" and "including" shall be deemed to be followed by the phrase "without limitation", (d) the word "will" shall be construed to have the same meaning and effect as the word "shall", (e) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments,
supplements or modifications set forth herein), (f) any reference herein to any Person shall be construed to include such Person's successors and assigns, (g) the words "herein", "hereof" and "hereunder", and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular provision hereof, (h) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, this Agreement, (i) the words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract
rights, (j) the term "documents" includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical
or electronic form, (k) in the computation of periods of time from a specified date to a later specified date, the word "from" means "from and including;" the words "to" and "until" each mean "to but excluding;" and the word "through" means "to and
including", and (l) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.
 SECTION 1.3    Accounting Terms. All accounting terms not specifically or completely defined herein shall be construed in
conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with GAAP as in effect from time to time, applied on a
consistent basis and in a manner consistent with that used in preparing the audited financial statements required by Section 7.1(b) and (d), except as otherwise specifically prescribed
herein.
 SECTION 1.4    PPSA and CCQ Terms. Terms defined in the PPSA or the CCQ in effect on the Closing Date and
not otherwise defined herein shall, unless the context otherwise indicates, have the meanings provided by those definitions. Subject to the foregoing, the terms "PPSA" and "CCQ
" refer, as of any date of determination, to the PPSA or the CCQ, as applicable, then in effect.
 SECTION
1.5   Rounding. Any financial ratios required to be maintained pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number
of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).
 SECTION 1.6   References to Agreement and Laws. Unless otherwise expressly provided herein, (a) references to formation documents,
governing documents, agreements (including the Loan Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that
such amendments, restatements, extensions,
  
  
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 supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Applicable Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Applicable Law.
 SECTION 1.7    Times of Day. Unless otherwise specified, all references herein to times of day shall be references to Eastern
time (daylight or standard, as applicable).
 SECTION 1.8     Letter of Credit Amounts. Unless otherwise
specified, all references herein to the amount of a Letter of Credit at any time shall be deemed to mean the maximum face amount of such Letter of Credit after giving effect to all increases thereof contemplated by such Letter of Credit or the
Letter of Credit Application therefor, whether or not such maximum face amount is in effect at such time.
 SECTION
1.9   Amount Of Obligations. Unless otherwise specified, for purposes of this Agreement, any determination of the amount of any outstanding Loans, L/C Obligations or other Obligations or the amount of the Borrowing Base or any
component thereof shall be based upon the Dollar Amount of such outstanding Loans, L/C Obligations or other Obligations or Borrowing Base or component thereof.
 ARTICLE II
  
 REVOLVING CREDIT FACILITY
 SECTION 2.1   REVOLVING CREDIT LOANS. SUBJECT TO THE TERMS AND CONDITIONS OF THIS AGREEMENT (INCLUDING, WITHOUT
LIMITATION, WITH RESPECT TO ANY BA LOAN, SECTION 2.7), AND IN RELIANCE UPON THE REPRESENTATIONS AND WARRANTIES SET FORTH HEREIN, EACH LENDER SEVERALLY AGREES TO MAKE REVOLVING CREDIT LOANS IN ANY PERMITTED CURRENCY TO THE BORROWER FROM TIME TO TIME
FROM THE CLOSING DATE THROUGH, BUT NOT INCLUDING, THE MATURITY DATE AS REQUESTED BY THE BORROWER IN ACCORDANCE WITH THE TERMS OF SECTION 2.3; PROVIDED, THAT (A) THE AGGREGATE PRINCIPAL AMOUNT OF ALL OUTSTANDING REVOLVING CREDIT LOANS, AFTER GIVING
EFFECT TO ANY AMOUNT REQUESTED, SHALL NOT EXCEED THE BORROWING LIMIT AND (B) THE PRINCIPAL AMOUNT OF OUTSTANDING REVOLVING CREDIT LOANS FROM ANY LENDER SHALL NOT AT ANY TIME EXCEED AN AMOUNT EQUAL TO SUCH LENDER'S COMMITMENT LESS SUCH LENDER'S
REVOLVING CREDIT COMMITMENT PERCENTAGE OF OUTSTANDING L/C OBLIGATIONS LESS SUCH LENDER'S COMMITMENT PERCENTAGE OF THE SWINGLINE COMMITMENT. EACH REVOLVING CREDIT LOAN BY A LENDER SHALL BE IN A PRINCIPAL AMOUNT EQUAL TO SUCH LENDER'S REVOLVING CREDIT
COMMITMENT PERCENTAGE OF THE AGGREGATE PRINCIPAL AMOUNT OF REVOLVING CREDIT LOANS REQUESTED ON SUCH OCCASION IN THE PERMITTED CURRENCY REQUESTED BY THE BORROWER. SUBJECT TO THE TERMS AND CONDITIONS HEREOF, THE BORROWER MAY BORROW, REPAY AND REBORROW
REVOLVING CREDIT LOANS HEREUNDER UNTIL THE MATURITY DATE.
  
  
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	 SECTION 2.2

  
	 Swingline
Loans.

 (a)       Availability. Subject to the terms and conditions of this Agreement and so long as the Swingline Lender has not received notice of a Default or an Event of Default in the manner consistent with the requirements of Section 13.10(b)
 and which such Default or Event of Default has not been waived by the Required Lenders, the Required Agreement Lenders or the Lenders, as applicable, the Swingline Lender agrees to make Swingline Loans, including by way of
an overdraft (after giving effect to all applicable netting arrangements entered into with the Swingline Lender respecting accounts subject to any deposit account control agreements executed in connection herewith) in any account of the Borrower
maintained with the Swingline Lender, in any Permitted Currency to the Borrower from time to time from the Closing Date through, but not including, the Swingline Termination Date; provided, that the
aggregate principal amount of all outstanding Swingline Loans (after giving effect to any amount requested), shall not exceed the lesser of (i) the Borrowing Limit and (ii) the Swingline Commitment.
 
	  
	 (b)
	 Refunding
.

 (i)        Swingline
Loans shall be refunded by the Lenders in the applicable Permitted Currency on demand by the Swingline Lender with notice to the Administrative Agent only following the occurrence and during the continuance of an Event of Default; provided that the Lenders shall not be required to refund any Swingline Loan extended by the Swingline Lender to the Borrower after the occurrence and during the continuance of a Default or an Event of Default of which
the Swingline Lender has received notice in the manner consistent with the notice requirements of Section 13.10(b) and which such Default or Event of Default has not been waived by the Required Lenders,
the Required Agreement Lenders or the Lenders, as applicable. Such refundings shall be made by the Lenders by way of a Revolving Credit Loan in accordance with their respective Commitment Percentages (which Revolving Credit Loan shall bear interest
based upon (1) the Canadian Prime Rate with respect to any Swingline Loan denominated in Canadian Dollars and (2) the Base Rate with respect to any Swingline Loan denominated in Dollars). Each Lender shall fund its respective Commitment Percentage
of Revolving Credit Loans as required to repay Swingline Loans outstanding to the Swingline Lender upon any such demand by the Swingline Lender but in no event later than 1:00 p.m. on the next succeeding Business Day after such demand is made. No
Lender's obligation to fund its respective Commitment Percentage of a Swingline Loan shall be affected by any other Lender's failure to fund its Commitment Percentage of a Swingline Loan, nor shall any Lender's Commitment Percentage be increased as
a result of any such failure of any other Lender to fund its Commitment Percentage of a Swingline Loan.
 (ii)       The Borrower shall pay to the Swingline Lender on demand, in the applicable Permitted Currency, with notice to the Administrative Agent, the amount of such Swingline Loans to the extent amounts
received from the Lenders are not sufficient
  
  
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 to repay in full the outstanding Swingline Loans requested or required to be refunded. In addition, the Borrower hereby authorizes the Administrative
Agent to charge any account maintained by the Borrower with the Swingline Lender (up to the amount available therein) in order to immediately pay the Swingline Lender the amount of such Swingline Loans to the extent amounts received from the Lenders
are not sufficient to repay in full the outstanding Swingline Loans requested or required to be refunded. If any portion of any such amount paid to the Swingline Lender shall be recovered by or on behalf of the Borrower from the Swingline Lender in
bankruptcy or otherwise, the loss of the amount so recovered shall be ratably shared among all the Lenders in accordance with their respective Commitment Percentages (unless the amounts so recovered by or on behalf of the Borrower pertain to a
Swingline Loan extended after the occurrence and during the continuance of a Default or an Event of Default of which the Swingline Lender has received notice in the manner consistent with the notice requirements of Section
13.10(b) and which such Default or Event of Default has not been waived by the Required Lenders, the Required Agreement Lenders or the Lenders, as applicable).
 (iii)      Each Lender acknowledges and agrees that its obligation to refund Swingline Loans in
accordance with the terms of this Section is absolute and unconditional and shall not be affected by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions set forth in Article
V at the time of such refunding; provided that the Lenders shall not be required to refund any Swingline Loan extended by the Swingline Lender to the Borrower after the
occurrence and during the continuance of a Default or an Event of Default of which the Swingline Lender has received notice in the manner consistent with the notice requirements of Section 13.10(b) and
which such Default or Event of Default has not been waived by the Required Lenders, the Required Agreement Lenders or the Lenders, as applicable. Further, each Lender agrees and acknowledges that if, prior to the refunding of any outstanding
Swingline Loans pursuant to this Section, one of the events described in Section 12.1(i) or (j) shall have occurred, each Lender will, on the date the
applicable Revolving Credit Loan would have been made, purchase an undivided participating interest in the Swingline Loan to be refunded (in lieu of its obligation to refund a Swingline Loan under clause (i) above) in an amount equal to its Commitment Percentage of the aggregate amount of such Swingline Loan. Each Lender will immediately transfer to the Swingline Lender, in immediately available funds in the applicable Permitted Currency, the
amount of its participation and upon receipt thereof the Swingline Lender will deliver to such Lender a certificate evidencing such participation dated the date of receipt of such funds and for such amount. Whenever, at any time after the Swingline
Lender has received from any Lender such Lender's participating interest in a Swingline Loan, the Swingline Lender receives any payment on account thereof, the Swingline Lender will distribute to such Lender its participating interest in such amount
(appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender's participating interest was outstanding and funded).
  
  
  

  
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SECTION 2.3     Procedure For Advances Of Revolving Credit Loans And Swingline Loans.
  

 (a)       Requests for Borrowing. The Borrower shall give the
Administrative Agent and, with respect to each Swingline Loan (other than a Swingline Loan made by way of overdraft), the Swingline Lender irrevocable prior written notice substantially in the form of Exhibit B
(a "Notice of Borrowing") not later than 12:00 p.m. (i) on the same Business Day as each Canadian Prime Rate Loan, each Base Rate Loan and each Swingline Loan, (ii) at least one (1)
Business Day before each BA Loan and (iii) at least three (3) Business Days before each LIBOR Rate Loan, of its intention to borrow, specifying (A) the date of such borrowing, which shall be a Business Day; (B) the applicable Permitted Currency with
respect to such borrowing; (C) the amount of such borrowing, which shall be, (1) with respect to Canadian Prime Rate Loans (other than Swingline Loans) in an aggregate principal amount of C$1,000,000 or a whole multiple of C$500,000 in excess
thereof, (2) with respect to Base Rate Loans (other than Swingline Loans) in an aggregate principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof, (3) with respect to BA Loans in an aggregate principal amount of C$1,000,000
or a whole multiple of C$500,000 in excess thereof, (4) with respect to LIBOR Rate Loans denominated in Canadian Dollars in an aggregate principal amount of C$3,000,000 or a whole multiple of C$1,000,000 in excess thereof, (5) with respect to LIBOR
Rate Loans denominated in Dollars in an aggregate principal amount of $3,000,000 or a whole multiple of $1,000,000 in excess thereof and (6) with respect to Swingline Loans in any amount of Canadian Dollars or Dollars (as applicable); (D) whether
such Loan is to be a Revolving Credit Loan or Swingline Loan; (E) in the case of a Revolving Credit Loan whether the Loans are to be LIBOR Rate Loans, Canadian Prime Rate Loans, Base Rate Loans or BA Loans; and (E) in the case of a LIBOR Rate Loan
or any BA Loan, the duration of the Interest Period applicable thereto. A Notice of Borrowing received after 12:00 p.m. shall be deemed received on the next Business Day. The Administrative Agent shall promptly notify the Lenders of each Notice of
Borrowing.
 (b)       Disbursement of Revolving Credit and Swingline
Loans. Not later than 2:00 p.m. on the proposed borrowing date for any Loan (including any BA Loan), (i) each Lender will make available to the Administrative Agent, for the account of the Borrower, at the Administrative
Agent's Office in funds immediately available to the Administrative Agent, such Lender's Revolving Credit Commitment Percentage of the Revolving Credit Loans (including any BA Loan) to be made on such borrowing date (provided
 that, without limiting anything to the contrary contained herein, BA Loans shall be subject to all disbursement provisions of Section 2.7) and (ii) the Swingline Lender will
make available to the Administrative Agent, for the account of the Borrower, at the Administrative Agent's Office in funds immediately available to the Administrative Agent, the Swingline Loans (other than a Swingline Loan made by way of overdraft)
to be made on such borrowing date. The Borrower hereby irrevocably authorizes the Administrative Agent (or with respect to Swingline Loans made by way of overdraft, the Swingline Lender) to disburse the proceeds of each borrowing requested pursuant
to this Section in immediately available funds by crediting or wiring such proceeds to the deposit account of the Borrower identified in the most recent notice substantially in the form of Exhibit C (a
"Notice of Account Designation") delivered by the Borrower to the Administrative Agent (or as may be otherwise agreed upon by the Borrower and the Administrative Agent or, with respect to Swingline
Loans made by way of overdraft, the Swingline Lender) from time to time. Subject to Section 4.7 hereof, the Administrative Agent shall not be obligated to disburse the portion of the proceeds of any
Loan (including any BA Loan) requested pursuant to this Section to the extent that (i) with respect to any Revolving Credit Loan (including any BA Loan), any Lender has not made available to the Administrative Agent its Revolving Credit Commitment
Percentage of
  
  
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 such Revolving Credit Loan (including any BA Loan) or
(ii) with respect to any Swingline Loan, the Swingline Lender has not made available to the Administrative Agent such Swingline Loan. Revolving Credit Loans to be made for the purpose of refunding Swingline Loans shall be made by the Lenders as
provided in Section 2.2(b).
 (c)       Notwithstanding
the foregoing, any check, payment instruction or debit authorization drawn on or made to the Swingline Lender by the Borrower resulting in an overdraft in any account maintained by the Swingline Lender subject to any deposit account control
agreements executed in connection herewith will be deemed to be a request (an "Overdraft Request") for a Swingline Loan to be made in an amount sufficient to cover such overdraft. Notwithstanding the
foregoing, the notice required in this Section shall not be required in connection with any Overdraft Request and all Overdraft Requests shall be funded as Swingline Loans by the Swingline Lender to the Borrower as agreed to by the Swingline Lender
and the Borrower in accordance with Section 2.2(a).
 SECTION
2.4   Repayment And Prepayment Of Revolving Credit Loans And Swingline Loans.
 (a)       Repayment on Maturity Date. The Borrower hereby agrees to repay the outstanding principal amount of (i) all Revolving Credit Loans in full on the
Maturity Date, and (ii) all Swingline Loans in accordance with Section 2.2(b), together, in each case, with all accrued but unpaid interest thereon.
 
	  
	 (b)
	 Mandatory
Prepayments.

 (i)        
Borrowing Limit. If at any time (as determined by the Administrative Agent under Section 2.4(b)(iv), which determination shall be conclusive absent
manifest error):
 (A)      solely because of currency fluctuation, the outstanding
principal amount of all Revolving Credit Loans plus the sum of the Swingline Commitment and all outstanding L/C Obligations exceeds one hundred and five percent (105%) of the Borrowing Limit (including,
without limitation, (1) upon a reduction of the Overadvance Amount pursuant to the definition thereof or Section 8.2(b) or otherwise, (2) pursuant to Section 8.2(b)
or (3) as otherwise required by the terms of this Agreement); or
  
 (B)      for any other reason, the outstanding principal amount of all Revolving Credit
Loans plus the sum of the Swingline Commitment and all outstanding L/C Obligations exceeds the Borrowing Limit (including, without limitation, (1) upon a reduction of the Overadvance Amount pursuant to
the definition thereof or Section 8.2(b) or otherwise, (2) pursuant to Section 8.2(b) or (3) as otherwise required by the terms of this
Agreement);
  
  
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 then, in each such case, the Borrower
agrees to repay (x) if such excess results from a change to the Asset Coverage Amount, within three (3) Business Days following the delivery of the applicable financial statements resulting in such change or (y) in any other circumstance,
immediately upon notice from the Administrative Agent, by payment to the Administrative Agent for the account of the Lenders, Extensions of Credit in an amount equal to such excess with each such repayment applied first to the principal amount of outstanding Swingline Loans, second to the principal amount of outstanding Revolving Credit Loans (other than Bankers' Acceptances and BA
Loans) and third, with respect to any Letters of Credit, Bankers' Acceptances or BA Loans then outstanding, a payment of cash collateral into a cash collateral account opened by the Administrative
Agent, for the benefit of the Lenders in an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit, Bankers' Acceptances or BA Loans (such cash collateral to be applied in accordance with Section 2.5(b) or Section 12.2(b)).
 (ii)       Excess Swingline Loans. If at any time (as determined by the Administrative Agent or the Swingline Lender under Section
2.4(b)(iv), which determination shall be conclusive absent manifest error) the outstanding amount of all Swingline Loans exceeds the Swingline Commitment, then, in each such case, the Borrower agrees to repay, immediately
upon notice from the Administrative Agent, by payment to the Administrative Agent for the account of the Swingline Lender, Swingline Loans in an amount equal to such excess; provided that if such excess
is solely as a result of currency fluctuations the Borrower shall only be required to make such payment to the extent that the outstanding amount of all Swingline Loans exceeds one hundred and five percent (105%) of the Swingline
Commitment.
 (iii)      Excess L/C Obligations. If at any time (as determined by the Administrative Agent under Section 2.4(b)(iv), which determination shall be conclusive absent manifest error) the outstanding amount of all L/C Obligations
exceeds the L/C Commitment, then, in each such case, the Borrower shall make a payment of cash collateral into an account opened by the Administrative Agent, for the benefit of itself and the Lenders, in an amount equal to the aggregate then undrawn
and unexpired amount of such Letters of Credit (such cash collateral to be applied in accordance with Section 12.2(b)); provided that if such excess is
solely as a result of currency fluctuations the Borrower shall only be required to make such payment of cash collateral to the extent that the outstanding amount of all L/C Obligations exceeds one hundred and five percent (105%) of the L/C
Commitment.
 (iv)      Testing. The
Borrower's compliance with this Section 2.4(b) shall be tested only at each Determination Time.
 (v)       Additional Mandatory Prepayments. In
addition to the foregoing, the Borrower shall prepay the Loans in accordance with Section 8.2(b).
 (c)       Optional Prepayments. The Borrower may at any time and
from time to time prepay Revolving Credit Loans and Swingline Loans, in whole or in part, with irrevocable prior
  
  
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 written notice to the Administrative Agent substantially in the form of Exhibit D (a "Noticeof
Prepayment") given not later than 12:00 p.m. (i) on the same Business Day as the prepayment of each Canadian Prime Rate Loan and each Base Rate Loan (including, in each case, each Swingline Loan), (ii) at least one (1)
Business Day before the prepayment of each BA Loan and (iii) at least three (3) Business Days before the prepayment of each LIBOR Rate Loan, specifying the date and amount of prepayment, the applicable Permitted Currency in which such
prepayment is denominated and whether the prepayment is of Canadian Prime Rate Loans, Base Rate Loans, BA Loans, LIBOR Rate Loans, Swingline Loans or a combination thereof, and, if of a combination thereof, the amount allocable to each. Upon receipt
of such notice, the Administrative Agent shall promptly notify each Lender. If any such notice is given, the amount specified in such notice shall be due and payable on the date set forth in such notice. Partial prepayments shall be in an aggregate
amount of C$1,000,000 or a whole multiple of C$500,000 in excess thereof with respect to Canadian Prime Rate Loans (other than Swingline Loans), $1,000,000 or a whole multiple of $500,000 in excess thereof with respect to Base Rate Loans (other than
Swingline Loans), C$1,000,000 or a whole multiple of C$500,000 in excess thereof with respect to BA Loans, C$3,000,000 or a whole multiple of C$1,000,000 in excess thereof with respect to LIBOR Rate Loans denominated in Canadian Dollars, $3,000,000
or a whole multiple of $1,000,000 in excess thereof with respect to LIBOR Rate Loans denominated in Dollars, C$100,000 or a whole multiple of C$100,000 in excess thereof with respect to Swingline Loans denominated in Canadian Dollars and $100,000 or
a whole multiple of $100,000 in excess thereof with respect to Swingline Loans denominated in Dollars. A Notice of Prepayment received after 12:00 p.m. shall be deemed received on the next Business Day. Notwithstanding the foregoing, the notices
required in this Section shall not be required for any prepayment of Swingline Loans prepaid by way of netting arrangements entered into by the Swingline Lender with the Borrower in the administration of accounts subject to any deposit account
control agreement executed in connection herewith and maintained with the Swingline Lender.
 
	  
	 (d)
	 Limitation
on Prepayment of LIBOR Rate Loans and BA Loans.

 (i)        The Borrower may not prepay any LIBOR Rate Loan on any day other than on the last day of the Interest Period applicable thereto unless such prepayment is accompanied by any amount required to
be paid pursuant to Section 4.9 hereof.
 (ii)       Notwithstanding Section 2.4(c) above, the Borrower may not prepay any BA Loan on any day other than on the last day of the Interest Period applicable
thereto; provided that, notwithstanding anything to the contrary contained in this Agreement, if at any time any Bankers' Acceptances are required to be prepaid prior to their maturity, the Borrower
shall be required to deposit the amount of such prepayment in a cash collateral account with the Administrative Agent until the date of maturity of such Bankers' Acceptances. Such cash collateral account shall be under the sole control of the
Administrative Agent. Except as contemplated hereby, neither the Borrower nor any Person claiming on behalf of the Borrower shall have any right to any of the cash in such cash collateral account. The Administrative Agent shall apply the cash held
in such cash collateral account to the face amount of such Bankers' Acceptances at maturity whereupon any cash remaining in such cash collateral account shall be released by the Administrative Agent to the Borrower. Upon deposit of such cash
collateral as provided
  
  
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 herein, such Bankers' Acceptances
shall not be considered to be outstanding for any purpose hereunder, including, without limitation, calculation of Average Utilization and availability under the Borrowing Limit.
 (e)       Hedging Agreements. No repayment or prepayment pursuant to
this Section shall affect any of the Borrower's obligations under any Hedging Agreement.
 
	  
	 SECTION 2.5

  
	 Permanent
Reduction of the Commitment.
  

 (a)       Voluntary Reduction. The Borrower shall have the right at
any time and from time to time, upon at least five (5) Business Days prior written notice to the Administrative Agent, to permanently reduce, without premium or penalty, (i) the entire Commitment at any time or (ii) portions of the Commitment, from
time to time, in an aggregate principal amount not less than $5,000,000 or any whole multiple of $5,000,000 in excess thereof. Any reduction of the Commitment shall be applied to the Commitment of each Lender according to its Commitment Percentage.
All commitment fees accrued until the effective date of any permanent reduction of the Commitment shall be paid on the effective date of such permanent reduction.
 (b)       Mandatory Reduction. The Borrower shall permanently reduce
the Commitment, without duplication, (i) as and when the Overadvance Amount is reduced pursuant to, and in accordance with, the definition of "Overadvance Amount" (such reduction to be made on a dollar-for-dollar basis) and (ii) pursuant to, and in
accordance with, Section 8.2(b) (including, without limitation, in connection with the reduction of the Overadvance Amount in accordance with Section 8.2(b)). Any reduction of the Commitment shall be applied to the Commitment of each Lender according to its Commitment Percentage. All commitment fees accrued until the effective date of any permanent reduction of the Commitment shall be paid on
the effective date of such permanent reduction.
 (c)       Corresponding
Payment. Each permanent reduction permitted or required pursuant to this Section or Section 8.2(b) shall be accompanied by a payment of principal sufficient to reduce the
aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C Obligations, as applicable, after such reduction to the Commitment as so reduced and if the Commitment as so reduced is less than the aggregate amount of all outstanding Letters
of Credit, the Borrower shall be required to deposit cash collateral in a cash collateral account opened by the Administrative Agent in an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit. Such cash
collateral shall be applied in accordance with Section 12.2(a). Any reduction of the Commitment to zero shall be accompanied by payment of all outstanding Revolving Credit Loans and Swingline Loans (and furnishing of cash collateral for all L/C
Obligations) and shall result in the termination of the Commitment and the Credit Facility. Such cash collateral shall be applied in accordance with Section 12.2(b). If the reduction of the Commitment requires the repayment of any LIBOR Rate Loan or
any BA Loan, such repayment shall be accompanied by any amount required to be paid pursuant to Section 4.9 hereof; provided that, notwithstanding anything
to the contrary contained in this Agreement, if at any time any Bankers' Acceptances are prepaid prior to their maturity, the Borrower shall be required to deposit the amount of such prepayment in a cash collateral account with the Administrative
Agent until the date of maturity of such Bankers' Acceptances. Such cash collateral account shall be under the sole control of the Administrative Agent. Except as
  

  
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 contemplated hereby, neither the Borrower nor any Person claiming on behalf of the Borrower shall have any right to any of the cash in such cash collateral account. The
Administrative Agent shall apply the cash held in such cash collateral account to the face amount of such Bankers' Acceptances at maturity whereupon any cash remaining in such cash collateral account shall be released by the Administrative Agent to
the Borrower. Upon deposit of such cash collateral as provided herein, such Bankers' Acceptances shall not be considered to be outstanding for any purpose hereunder, including, without limitation, calculation of Average Utilization and availability
under the Borrowing Limit.
 
	  
	 SECTION 2.6

  
	 Termination of Credit Facility.
  

 (a)       The Credit Facility shall terminate on the earliest of: (i) May 30, 2007 (it being agreed by all parties
hereto that, as of the Seventh Amendment Effective Date, such date has been extended to June 5, 2009), (ii) the date of termination by the Borrower pursuant to Section 2.5, (iii) the date of termination by the Administrative Agent on behalf of
the Lenders pursuant to Section 12.2(a), (iv) the date which is ninety-one (91) days prior to the then current maturity date of any Specified Existing Note if on the date which is one hundred twenty (120) days prior to the then current maturity
date of such Specified Existing Note either (A) the remaining outstanding principal balance thereof (excluding any such balance as to which sums have been set aside for the payment thereof pursuant to any defeasance or sinking fund or escrow
arrangement or similar provisions) is in excess of $75,000,000 or (B) the Aggregate Credit Exposure is in excess of $100,000,000 and the outstanding principal balance of such Specified Existing Note (excluding any such balance as to which sums have
been set aside for the payment thereof pursuant to any defeasance or sinking fund or escrow arrangement or similar provisions) has not been paid in full; or (v) the date which is ninety-one (91) days prior to the then current maturity date of
any Indebtedness permitted pursuant to Section 12.1(o)(iii) if, on the date which is one hundred twenty (120) days prior to the then current maturity date of such Indebtedness, such Indebtedness has not been paid in full in accordance with the terms
of this Agreement or extended or refinanced such that the maturity of such Indebtedness is more than ninety-one (91) days after May 27, 2009 (as such date may be extended pursuant to Section 2.6(b)); provided, that, on an annual basis the Borrower shall be entitled to request an extension of the Credit Facility upon the same terms and conditions as contained herein for an additional 364-day period and thereafter be entitled to request subsequent
extensions for 364-day periods, which request shall be granted in the Lenders' discretion and subject to the provisions of Sections 2.6(b) and (c); provided that the following conditions are satisfied (A) no Default or Event of Default has occurred and is continuing, (B) the Credit Facility has not been terminated pursuant to clause (ii), (iii), (iv) or (v) above, (C) the Borrower provides
written notice to the Administrative Agent (the "Extension Notice") at least ninety (90) days prior to the then existing Maturity Date (the date on which such Extension Notice is delivered, the
"Extension Notice Date") of its request to extend the Credit Facility and (D) each of the conditions set forth in Section 5.3 on the then existing Maturity Date are satisfied by the Borrower.

(b)       The Administrative Agent shall promptly deliver a copy of the Extension Notice to each Lender upon
receipt of same from the Borrower. Each of the Lenders shall within thirty (30) days from the Extension Notice Date (the "Consent Date") provide written notice to the Administrative Agent of each such
Lender's agreement to extend (any such Lender, a "Consenting Lender") or not to so extend (any such Lender, a "Non-Consenting Lender") the
  

  
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 then existing Maturity Date. No Lender shall be under any obligation or commitment to extend the then existing Maturity Date and no such obligation or commitment on the
part of any Lender shall be inferred from the provisions of this Section 2.6. Failure on the part of any Lender to respond to the Extension Notice by the Consent Date shall be deemed to be a refusal of such Lender to consent to the Extension Notice
and such Lender shall be deemed to be a Non-Consenting Lender for purposes of this Section 2.6. The Administrative Agent shall provide a written list of the Consenting Lenders and Non-Consenting Lenders to the Borrower and the Lenders promptly
following the Consent Date.
 (c)       All Loans of any Non-Consenting Lender shall be subject to the
then existing Maturity Date. If Lenders holding Commitment Percentages aggregating less than one hundred percent (100%) of the aggregate Commitments consent to such extension, the Borrower may elect by written notice to the Administrative Agent to
(i) continue the Credit Facility for such additional period with an aggregate Commitment equal to the then effective aggregate Commitment less the total Commitments of the Non-Consenting Lenders (provided that such continuation shall be permitted only if the total amount of such Commitments to be continued are equal to or greater than fifty percent (50%) of the total amount of the original Commitments (after giving effect to any assignments
pursuant to clause (iii) below)) or (ii) not continue the Credit Facility for such additional period and, in such event, the Extension Notice shall be of no further effect or (iii) require any such Non-Consenting Lender to transfer and assign
without recourse (in accordance with the provisions of Section 14.10) its Commitment and other interests, rights and obligations under this Agreement to an Eligible Assignee which consents thereto, which shall assume such obligations upon its
consent to assume such obligations; provided that (A) no such assignment shall conflict with any Applicable Law, (B) such assignment shall be at the cost and expense of the Borrower and (C) the purchase
price to be paid to such Non-Consenting Lender shall be an amount equal to the outstanding principal amount of the Loans of such Non-Consenting Lender plus all interest accrued and unpaid thereon and all other amounts owing to such Non-Consenting
Lender thereon. If the extension is granted and the conditions set forth in clause (a) of this Section 2.6 are satisfied, upon the then existing Maturity Date, the scheduled Maturity Date shall be extended to the date which is 364 days from such
then existing Maturity Date.
 
	  
	 SECTION 2.7

  
	 Terms
Applicable to BA Loans.
  

 
	  
	 (a)
	 Commitment
for BA Loans.

 (i)        Subject to the terms and conditions of this Agreement, the Borrower shall be entitled to receive the BA Proceeds of Bankers' Acceptances denominated in Canadian Dollars in accordance with the
provisions of Article II (including, without limitation, this Section 2.7); provided that:
 (A)      the aggregate principal amount of all outstanding BA Loans (after giving effect to any
amount requested) shall not exceed the Borrowing Limit; and
 (B)      the aggregate
principal amount of all outstanding BA Loans from any Lender shall not at any time exceed such Lender's Commitment
  
  
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 less such Lender's Revolving Credit Commitment Percentage of outstanding Revolving Credit Loans (other than BA Loans) and
outstanding L/C Obligations less such Lender's Commitment Percentage of the Swingline Commitment.
 Each BA Loan shall be funded in Canadian Dollars by each Lender in a principal amount equal to such Lender's Revolving Credit Commitment Percentage of the aggregate principal amount of BA Loans requested on such occasion. Subject to the terms
and conditions hereof, the Borrower may borrow, repay and reborrow BA Loans hereunder until the Maturity Date.
 (ii)       For the purposes of this Agreement, the full face amount of Bankers' Acceptances, without discount, shall be used when calculations are made to determine the amount of Loans outstanding. Each
determination by the Administrative Agent of the Stamping Fee, the BA Discount Rate and the BA Proceeds shall, in the absence of manifest error, be presumed correct.
 (b)       Term. Each Bankers' Acceptance shall have an Interest
Period as determined pursuant to Section 4.1(b) (subject to availability).
 (c)       Discount Rate. On each borrowing date on which Bankers' Acceptances are to be accepted, the Administrative Agent shall advise the Borrower as to its
determination of the applicable BA Discount Rate for the Bankers' Acceptances which the Lenders have agreed to purchase.
 (d)       Purchase of Bankers' Acceptances. Each Lender agrees to purchase a Bankers' Acceptance accepted by it. The Borrower shall sell, and such Lender shall
purchase, the Bankers' Acceptance at the applicable BA Discount Rate. Each Lender shall provide, to the account of the Administrative Agent, the BA Proceeds less the Stamping Fee payable by the Borrower
with respect to the Bankers' Acceptance. The Administrative Agent shall make available to the Borrower, in accordance with the provisions of Section 2.3, the BA Proceeds less the applicable Stamping Fee with respect to each Bankers' Acceptance purchased and each BA Equivalent Loan advanced by a Lender on the date of such acceptance. Each Lender may from time to time hold, sell,
rediscount, trade or otherwise dispose of any or all Bankers' Acceptances accepted and purchased by it.
 (e)       Execution of Bankers' Acceptances. Drafts drawn by the Borrower to be accepted as Bankers' Acceptances shall be signed by a duly authorized officer or
officers of the Borrower or by its attorneys, including attorneys appointed pursuant to Section 2.7(f). Notwithstanding that any Person whose signature appears on any Bankers' Acceptance may no longer
be an authorized signatory for the Borrower at the time of issuance of a Bankers' Acceptance, that signature shall nevertheless be valid and sufficient for all purposes as if the authority had remained in force at the time of issuance and any
Bankers' Acceptance so signed shall be binding on the Borrower.
 (f)        Power of Attorney for the Execution of Bankers' Acceptances. To facilitate availment of the BA Loans, the Borrower hereby appoints each Lender as its attorney to sign and
  

  
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 endorse on its behalf, in handwriting or by facsimile or mechanical signature as and when deemed necessary by such Lender, blank forms of Bankers' Acceptances. In this
respect, it is each Lender's responsibility to maintain an adequate supply of blank forms of Bankers' Acceptances for acceptance under this Agreement. Each Lender shall exercise the same degree of care in the custody and safekeeping of signed blank
forms of Bankers' Acceptance as it exercises in respect of its own bearer securities. The Borrower recognizes and agrees that all Bankers' Acceptances signed and/or endorsed on its behalf by a Lender shall bind the Borrower as fully and effectually
as if signed in the handwriting of and duly issued by the proper signing officers of the Borrower. Each Lender is hereby authorized to issue such Bankers' Acceptances endorsed in blank in such face amounts as may be determined by such Lender;
provided that the aggregate amount thereof is equal to the aggregate amount of Bankers' Acceptances required to be accepted and purchased by such Lender. No Lender shall be liable for any damage, loss or other
claim arising by reason of any loss or improper use of any such instrument except to the extent that such damage, loss or other claim is determined by a court of competent jurisdiction by final nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Lender or its officers, employees, agents or representatives. On the repayment in full of all Obligations or on request by the Borrower, each Lender shall cancel all forms of Bankers' Acceptances which have
been pre-signed or pre-endorsed by or on behalf of the Borrower and which are held by such Lender and have not yet been issued in accordance herewith. Each Lender shall maintain a record with respect to Bankers' Acceptances held by it in blank
hereunder, voided by it for any reason, accepted and purchased by it hereunder, and cancelled at their respective maturities. Each Lender agrees to provide such records to the Borrower at the Borrower's expense upon request.
 To facilitate the acceptance of Bankers' Acceptances hereunder, the Borrower hereby authorizes the Lenders and irrevocably appoints each of the
Lenders as its attorney, respectively:
 (i)        to complete and sign on
the Borrower's behalf, either manually or by facsimile or mechanical signature, the drafts to create the Bankers' Acceptances (with, in each Lender's discretion, the inscription "This is a depository bill subject to the Depository Bills and Notes Act (Canada)");
 (ii)       after the acceptance thereof by any Lender, to endorse on the Borrower's behalf, either manually or by facsimile or mechanical signature, such Bankers' Acceptances in favor of the applicable
purchaser or endorsee thereof including, in such Lender's discretion, such Lender or a clearing house (as defined by the Depository Bills and Notes Act (Canada));
 (iii)      to deliver such Bankers' Acceptances to such purchaser or to deposit such Bankers'
Acceptances with such clearing house; and
 (iv)      to comply with the procedures and
requirements established from time to time by such Lender or such clearing house in respect of the delivery, transfer and collection of bankers' acceptances and depository bills.
 All Bankers' Acceptances so completed, signed, endorsed, delivered or deposited by a Lender on behalf of the Borrower shall be binding upon the Borrower as if completed,
signed, endorsed,
  
  
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 delivered or deposited by it. The records of the Lenders
and such clearing houses shall, in the absence of manifest error, be conclusively binding on the Borrower. None of the Lenders shall be liable for any claim arising by reason of any loss or improper use of such drafts or Bankers' Acceptances except
for damages suffered by the Borrower caused by the willful misconduct or gross negligence of such Lender, as determined by a court of competent jurisdiction by final nonappealable judgment.
 (g)       Disbursement of BA Loans.Promptly following the receipt by
the Administrative Agent of a Notice of Borrowing or Notice of Conversion/Continuation in respect of Bankers' Acceptances, the Administrative Agent shall advise the Lenders of the notice and shall advise each Lender of the face amount of Bankers'
Acceptances to be accepted by it on the applicable borrowing date and the applicable Interest Period (which shall be identical for all Lenders). The aggregate face amount of Bankers' Acceptances to be accepted by a Lender shall be determined by the
Administrative Agent by reference to such Lender's Revolving Credit Commitment Percentage of the Bankers' Acceptances to be made on the applicable borrowing date, except that, if the face amount of a Bankers' Acceptance which would otherwise be
accepted by a Lender would not be C$100,000, or a whole multiple thereof, the face amount shall be increased or reduced by the Administrative Agent in its sole discretion to C$100,000, or the nearest whole multiple of that amount, as appropriate;
 provided that after such issuance, the aggregate principal amount of all outstanding BA Loans from any Lender shall not at any time exceed such Lender's Commitment less such Lender's Revolving Credit Commitment Percentage of outstanding Revolving Credit Loans (other than BA Loans) and outstanding L/C Obligations less such Lender's
Commitment Percentage of the Swingline Commitment.
 (h)       Waiver of
Presentment and Other Conditions. The Borrower waives presentment for payment and any other defense to payment of any amounts due to any Lender in respect of a Bankers' Acceptance accepted and purchased by it pursuant to this
Agreement which might exist solely by reason of the Bankers' Acceptance being held, at the maturity thereof, by such Lender in its own right and the Borrower agrees not to claim any days of grace if such Lender as holder sues the Borrower on the
Bankers' Acceptance for payment of the amount payable by the Borrower thereunder. On the specified maturity date of a Bankers' Acceptance or the date of any prepayment thereof in accordance with this Agreement, if earlier, the Borrower shall pay to
the Lender that has accepted such Bankers' Acceptance the full face amount of such Bankers' Acceptance and after such payment, the Borrower shall have no further liability in respect of such Bankers' Acceptance (except to the extent that any such
payment is rescinded or reclaimed by operation of law or otherwise) and such Lender shall be entitled to all benefits of, and be responsible for all payments due to third parties under, such Bankers' Acceptance.
 (i)        BA Equivalent Loans by Non-BA Lenders. Whenever the
Borrower requests a BA Loan or conversion to a BA Loan or continuation of a BA Loan under this Agreement, each Non-BA Lender shall, in lieu of accepting and purchasing a Bankers' Acceptance, make a BA Equivalent Loan in an amount equal to the Non-BA
Lender's Revolving Credit Commitment Percentage of the BA Loan to be made on the applicable borrowing date.
 (j)        Terms Applicable to Discount Notes. As set out in the definition of "Bankers' Acceptances", that term includes Discount Notes and all terms of
this Agreement applicable to
  
  
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 Bankers' Acceptances shall apply equally to Discount
Notes evidencing BA Equivalent Loans with such changes as may in the context be necessary. For purposes of this Agreement:
 (i)        the term of a Discount Note shall be the same as the Interest Period for Bankers' Acceptances accepted and purchased on the same date in respect of the same BA Loan;
 (ii)       a stamping fee will be payable in respect of a Discount Note and shall be calculated
at the same rate and in the same manner as the Stamping Fee in respect of a Bankers' Acceptance; and
 (iii)      the BA Discount Rate applicable to a Discount Note shall be the BA Discount Rate applicable to Bankers' Acceptances accepted by the Administrative Agent (or its designee), as Lender, on the same date,
in respect of the same BA Loan.
 (k)       Stamping Fees on Bankers' Acceptance
. The Borrower shall pay, in respect of each draft accepted by each Lender as a Bankers' Acceptance, a per annum stamping fee (the "Stamping Fee") equal to (i) the Applicable
Margin for LIBOR Rate Loans, changing when and as such Applicable Margin for LIBOR Rate Loans shall change, multiplied by (ii) the face amount of such Bankers' Acceptance, and
calculated based on the number of days to maturity of such Bankers' Acceptance divided by the number of days in the applicable year, being 365 or 366, as the case may be. Such
Stamping Fee shall be payable in advance on the date of issuance of the Bankers' Acceptance. The Borrower authorizes and directs each Lender to deduct from the BA Proceeds of Bankers' Acceptances purchased by such Lender for its own account, the
amount of each such Stamping Fee upon the issue of each Bankers' Acceptance.
 (l)        Depository Bills and Notes Act. At the option of the Borrower and any Lender, Bankers' Acceptances under this
Agreement to be accepted by such Lender may be issued in the form of depository bills for deposit with The Canadian Depository for Securities Limited pursuant to the Depository Bills and Notes Act (Canada). All depository bills so issued shall be
governed by the provisions of this Agreement.
 (m)      Circumstances Making
Bankers' Acceptances Unavailable. If the Administrative Agent determines in good faith, which determination shall constitute prima facie evidence thereof, and notifies the Borrower that, by reason of circumstances affecting
the money market, there is no market for Bankers' Acceptances, then:
 (i)        the right of the Borrower to request a BA Loan (or continuation or conversion thereof) shall be suspended until the Administrative Agent determines that the circumstances causing such
suspension no longer exist and the Administrative Agent so notifies the Borrower; and
  
 (ii)       any notice relating to a BA Loan (or continuation or conversion thereof) which is
outstanding at such time shall be deemed to be a notice requesting Canadian Prime Rate Loans (or continuation or conversion thereof).
 The Administrative
Agent shall promptly notify the Borrower and the Lenders of the suspension in accordance with this Section 2.7(m) of the Borrower's right to request a BA Loan (or continuation or conversion thereof) and
of the termination of any such suspension.
  
  
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 (n)       Prepayment. As provided in Section 2.4, the Borrower may pay the full face amount of a Bankers'
Acceptances to the Administrative Agent to be held by the Administrative Agent in a non-interest bearing (unless otherwise agreed to by the Administrative Agent) account as collateral security for the Borrower's obligations with respect to those
Bankers' Acceptances and after such payment, the Borrower shall have no further liability in respect of such Bankers' Acceptance (except to the extent that any such payment is rescinded or reclaimed by operation of law or otherwise) and any Lender
that accepted such Bankers' Acceptance shall be entitled to all benefits of, and be responsible for all payments due to third parties under, such Bankers' Acceptance.
 (o)       Default. Immediately upon termination of the Commitments
under Section 12.2, the Borrower shall pay to the Administrative Agent on behalf of the Lenders the full face amount of all Bankers' Acceptances which have not matured. Such amounts shall be held by the
Administrative Agent in a non-interest bearing (unless otherwise agreed to by the Administrative Agent) account as collateral security for the Borrower's obligations with respect to those Bankers' Acceptances.
 ARTICLE III
  
 LETTER OF CREDIT FACILITY
 SECTION 3.1   L/C
Commitment. Subject to the terms and conditions hereof, each Issuing Lender, in reliance on the agreements of the other Lenders set forth in Section 3.4(a), agrees to issue standby letters of credit ("Letters of Credit
") for the account of the Borrower on any Business Day from the Closing Date to, but not including, the fifth (5th) Business Day prior to the Maturity Date in such form as may be approved from time to time by the
applicable Issuing Lender; provided, that no Issuing Lender shall have any obligation to issue any Letter of Credit if, after giving effect to such issuance, (a) the aggregate amount of L/C Obligations
would exceed the L/C Commitment or (b) the aggregate amount of L/C Obligations would exceed the Borrowing Limit. Each Letter of Credit shall (i) be denominated in a Permitted Currency and (ii) be a standby letter of credit issued to support
obligations of the Borrower or any of its Subsidiaries, contingent or otherwise, (iii) expire on a date that is no later than the fifth (5th) Business Day prior to the Maturity Date (provided that any such Letter of Credit may, (A) by its terms and otherwise consistent with this Agreement, provide for automatic annual renewals and (B) expire on a date that is after the Maturity Date with the prior written consent of each of the
Administrative Agent and the applicable Issuing Lender, in each such Person's sole discretion; provided that all L/C Obligations associated with any such Letter of Credit are cash collateralized in a
manner satisfactory to the Administrative Agent and the applicable Issuing Lender on or prior to the fifth (5th) Business Day prior to the Maturity Date and that, on the Maturity Date, all the L/C Participants are released from their L/C
Obligations pertaining to such Letters of Credit) and (iv) be subject to ISP98 and, to the extent not inconsistent therewith, the laws of the State of New York. No Issuing Lender shall at any time be obligated to issue any Letter of Credit hereunder
if such issuance would conflict with, or cause such Issuing Lender or any L/C Participant to exceed any limits imposed by, any Applicable Law. References herein to "issue" and derivations thereof with respect to Letters of Credit shall also include
extensions or modifications of any outstanding Letters of Credit, unless the context otherwise requires. As of
  
  
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 the Closing Date, each of the Existing Letters of Credit shall constitute, for all purposes of this Agreement and the other Loan Documents, a Letter of Credit issued and
outstanding hereunder.
 SECTION 3.2   Procedure For Issuance of Letters of Credit. The Borrower may from time to time
request that an Issuing Lender issue a Letter of Credit by delivering to such Issuing Lender at such Issuing Lender's Lending Office and to the Administrative Agent at the Administrative Agent's Office a Letter of Credit Application therefor,
completed to the reasonable satisfaction of the applicable Issuing Lender and the Administrative Agent, and such other certificates, documents and other papers and information as such Issuing Lender and the Administrative Agent may reasonably
request (the "L/C Supporting Documentation") (which information shall include the Permitted Currency in which the Letter of Credit shall be denominated). Upon receipt of any Letter of Credit Application
and the L/C Supporting Documentation, the applicable Issuing Lender shall process such Letter of Credit Application and the L/C Supporting Documentation delivered to it in connection therewith in accordance with its customary procedures and shall,
after approving the same and receiving confirmation from the Administrative Agent that sufficient availability exists under the Credit Facility for the issuance of such Letter of Credit, subject to Section 3.1 and Article V, promptly issue the
Letter of Credit requested thereby (but in no event shall the applicable Issuing Lender be required to issue any Letter of Credit earlier than three (3) Business Days after its receipt of the Letter of Credit Application therefor and the L/C
Supporting Documentation relating thereto) by issuing the original of such Letter of Credit to the beneficiary thereof or as otherwise may be agreed by the applicable Issuing Lender and the Borrower. The applicable Issuing Lender shall promptly
furnish to the Borrower and the Administrative Agent a copy of such Letter of Credit and the Administrative Agent shall promptly notify each Lender of the issuance of such Letter of Credit and, upon request by any Lender, furnish to such Lender a
copy of such Letter of Credit and the amount of such Lender's participation therein.
 
	  
	 SECTION 3.3

  
	 Commissions and Other Charges.
  

 (a)       Letter of Credit Commissions. The Borrower shall pay to
the Administrative Agent, for the account of the each applicable Issuing Lender and the L/C Participants, a letter of credit commission with respect to each Letter of Credit in an amount equal to the face amount of such Letter of Credit (as such
amount may be reduced by (i) any permanent reduction of such Letter of Credit or (ii) any amount which is drawn, reimbursed and no longer available under such Letter of Credit) multiplied by the
Applicable Margin with respect to LIBOR Rate Loans (determined on a per annum basis). Such commission shall be payable quarterly in arrears on the last Business Day of each calendar quarter, on the Maturity Date and thereafter on demand of the
Administrative Agent. The Administrative Agent shall, promptly following its receipt thereof, distribute to each applicable Issuing Lender and the L/C Participants all commissions received pursuant to this Section in accordance with their respective
Revolving Credit Commitment Percentages.
 (b)       Issuance
Fee. In addition to the foregoing commission, the Borrower shall pay to the Administrative Agent, for the account of each applicable Issuing Lender, an issuance fee with respect to each Letter of Credit issued by such Issuing
Lender in an amount equal to the face amount of such Letter of Credit multiplied by one-quarter of one percent (0.25%) per annum. Such issuance fee shall be payable quarterly in arrears on the last
Business Day of each calendar
  
  
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 quarter commencing with the first such date to occur
after the issuance of such Letter of Credit, on the Maturity Date and thereafter on demand of the applicable Issuing Lender.
 (c)       Other Costs. In addition to the foregoing fees and commissions, the Borrower shall pay or reimburse each Issuing Lender for such normal and customary
costs and expenses as are incurred or charged by such Issuing Lender in issuing, effecting payment under, amending or otherwise administering any Letter of Credit.
 (d)       Payments. The commissions, fees, charges, costs and
expenses payable pursuant to this Section 3.3 shall be payable in the Permitted Currency in which the applicable Letter of Credit is denominated.
 
	  
	 SECTION 3.4

  
	 L/C
Participations.

 (a)       Each Issuing Lender irrevocably agrees to
grant and hereby grants to each L/C Participant, and, to induce such Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from such Issuing Lender, on
the terms and conditions hereinafter stated, for such L/C Participant's own account and risk an undivided interest equal to such L/C Participant's Revolving Credit Commitment Percentage in such Issuing Lender's obligations and rights under and in
respect of each Letter of Credit issued by such Issuing Lender hereunder and the amount of each draft paid by such Issuing Lender thereunder. Each L/C Participant unconditionally and irrevocably agrees with each Issuing Lender that, if a draft is
paid under any Letter of Credit issued by such Issuing Lender for which such Issuing Lender is not reimbursed in full by the Borrower through a Revolving Credit Loan or otherwise in accordance with the terms of this Agreement, such L/C Participant
shall pay to such Issuing Lender in the applicable Permitted Currency upon demand at such Issuing Lender's Lending Office an amount equal to such L/C Participant's Revolving Credit Commitment Percentage of the amount of such draft, or any part
thereof, which is not so reimbursed.
 (b)       Upon becoming aware of any amount required to be paid
by any L/C Participant to the applicable Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any payment made by such Issuing Lender under any Letter of Credit issued by it, such Issuing Lender shall notify the
Administrative Agent and each L/C Participant of the amount and due date of such required payment and such L/C Participant shall pay to such Issuing Lender in the applicable Permitted Currency the amount specified on the applicable due date. If any
such amount is paid to such Issuing Lender after the date such payment is due, such L/C Participant shall pay to such Issuing Lender in the applicable Permitted Currency on demand, in addition to such amount, the product of (i) such amount,
multiplied by (ii) the Base Rate (with respect to payments required to be made in Dollars) or the Canadian Prime Rate (with respect to payments required to be made in Canadian Dollars), in each case as
determined by the Administrative Agent, during the period from and including the date such payment is due to the date on which such payment is immediately available to such Issuing Lender, multiplied by
(iii) a fraction, the numerator of which is the number of days that elapse during such period and the denominator of which is 360. A certificate of the applicable Issuing Lender with respect to any amounts owing under this Section shall be
conclusive in the absence of manifest error. With respect to payment to an Issuing Lender of the unreimbursed amounts described in this Section,
  
  
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 if the L/C Participants receive notice that any such payment is due (A) prior to 2:00 p.m. on any Business Day, such payment shall be due that Business Day, and (B) after
2:00 p.m. on any Business Day, such payment shall be due on the following Business Day.
 (c)       Whenever, at any time after the applicable Issuing Lender has made payment under any Letter of Credit and has received from any L/C Participant its Revolving Credit Commitment Percentage of such
payment in accordance with this Section, such Issuing Lender receives any payment related to such Letter of Credit (whether directly from the Borrower or otherwise), or any payment of interest on account thereof, such Issuing Lender will distribute
to such L/C Participant its pro rata share thereof; provided, that in the event that any such payment received by such Issuing
Lender shall be required to be returned by such Issuing Lender, such L/C Participant shall return to such Issuing Lender the portion thereof previously distributed by such Issuing Lender to it.
 SECTION 3.5   Reimbursement Obligation Of The Borrower. In the event of any drawing under any Letter of Credit, the Borrower agrees
to reimburse (either with the proceeds of a Revolving Credit Loan as provided for in this Section or with funds from other sources), in same day funds in the applicable Permitted Currency in which such Letter of Credit was denominated, the
applicable Issuing Lender on each date on which such Issuing Lender notifies the Borrower of the date and amount of a draft paid under any Letter of Credit for the amount of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c)
incurred by such Issuing Lender in connection with such payment. The applicable Issuing Lender shall promptly deliver written notice of any drawing under any Letter of Credit issued by such Issuing Lender to the Administrative Agent and the
Borrower. Unless the Borrower shall immediately notify the applicable Issuing Lender that the Borrower intends to reimburse such Issuing Lender for such drawing from other sources or funds, the Borrower shall be deemed to have timely given a Notice
of Borrowing to the Administrative Agent requesting that the Lenders make a Revolving Credit Loan bearing interest at the Base Rate (to the extent that the applicable Letter of Credit was denominated in Dollars) or the Canadian Prime Rate (to the
extent that the applicable Letter of Credit was denominated in Canadian Dollars) on such date in the amount of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c) incurred by such Issuing Lender in connection with such payment,
and the Lenders shall make such Revolving Credit Loan, the proceeds of which shall be applied to reimburse such Issuing Lender for the amount of the related drawing and costs and expenses. Each Lender acknowledges and agrees that its obligation to
fund a Revolving Credit Loan (or a Special Agent Advance, as the case may be) in accordance with this Section to reimburse the applicable Issuing Lender for any draft paid under a Letter of Credit is absolute and unconditional and shall not be
affected by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions set forth in Section 2.3(a) or Article V. If the Borrower has elected to pay the amount of such
drawing with funds from other sources and shall fail to reimburse the applicable Issuing Lender as provided above, the unreimbursed amount of such drawing shall bear interest at the rate which would be payable on any outstanding Base Rate Loans
(with respect to any amount payable in Dollars) or any outstanding Canadian Prime Rate Loans (with respect to any amount payable in Canadian Dollars), in each case which were then overdue, from the date such amounts become payable (whether at stated
maturity, by acceleration or otherwise) until payment in full.
  
  
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 SECTION 3.6   Obligations Absolute. The Borrower's obligations under this Article III (including, without limitation, the
Reimbursement Obligation) shall be absolute and unconditional under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment which the Borrower may have or have had against any Issuing Lender or any beneficiary of
a Letter of Credit or any other Person. The Borrower also agrees that no Issuing Lender nor any L/C Participant shall be responsible for, and the Borrower's Reimbursement Obligation under Section 3.5 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any
other party to which such Letter of Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee. No Issuing Lender shall be liable for any error, omission, interruption
or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions caused by the applicable Issuing Lender's gross negligence or willful misconduct,
as determined by a court of competent jurisdiction by final nonappealable judgment. The Borrower agrees that any action taken or omitted by the applicable Issuing Lender under or in connection with any Letter of Credit or the related drafts or
documents, if done in the absence of gross negligence or willful misconduct shall be binding on the Borrower and shall not result in any liability of such Issuing Lender or any L/C Participant to the Borrower. The responsibility of the applicable
Issuing Lender to the Borrower in connection with any draft presented for payment under any Letter of Credit shall, in addition to any payment obligation expressly provided for in such Letter of Credit, be limited to determining that the documents
(including each draft) delivered under such Letter of Credit in connection with such presentment are in conformity with such Letter of Credit.
 SECTION 3.7     Effect Of Letter Of Credit Application. To the extent that any provision of any Letter of Credit Application or L/C Supporting Documentation related to any Letter of Credit is inconsistent with the
provisions of this Article III, the provisions of this Article IIIshall apply.
 ARTICLE IV
  
 GENERAL LOAN PROVISIONS
 
	  
	 SECTION 4.1

  
	 Interest.
  

 (a)       Interest Rate Options. Subject to the provisions of this
Section, at the election of the Borrower:
 (i)        Revolving Credit Loans
denominated in Canadian Dollars (other than BA Loans) shall bear interest at (A) the Canadian Prime Rate plus the Applicable Margin or (B) the LIBOR Rate plus the Applicable Margin;
 (ii)       Revolving Credit Loan denominated in
Canadian Dollars in the form of a BA Loan (and the Banker's Acceptance applicable thereto) shall be discounted, and shall otherwise be subject to such other terms and conditions, set forth in Section 2.7;
  

  
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 (iii)      Revolving Credit Loans denominated in Dollars shall bear interest at (A) the Base Rate
 plus the Applicable Margin or (B) the LIBOR Rate plus the Applicable Margin;
 (iv)      Swingline Loans denominated in Canadian Dollars shall bear interest at the Canadian Prime
Rate plus the Applicable Margin; and
 (v)       Swingline Loans denominated in Dollars shall bear interest at the Base Rate plus the Applicable Margin.
 The Borrower shall select the type of Loan, the applicable Permitted Currency, the rate of interest and the Interest Period, if any, applicable to any Loan at the time a
Notice of Borrowing is given pursuant to Section 2.3 or at the time a Notice of Conversion/Continuation is given pursuant to Section 4.2. Any Loan or any portion thereof as to which the Borrower has not
duly specified (i) a type of Loan shall be deemed to be a Revolving Credit Loan, (ii) a currency as provided herein shall be deemed to be a Revolving Credit Loan denominated in Canadian Dollars or (iii) an interest rate as provided herein shall be
deemed to be a Base Rate Loan (if such Loan is to be denominated in Dollars) or a Canadian Prime Rate Loan (if such Loan is to be denominated in Canadian Dollars).
 (b)       Interest Periods. In connection with each LIBOR Rate Loan
and each BA Loan, the Borrower, by giving notice at the times described in Section 2.3 or 4.2, as applicable, shall elect an interest period (each, an "Interest
Period") to be applicable to such Revolving Credit Loan, which Interest Period shall be a period of one (1), two (2), three (3), or six (6) months (provided, that prior to the Conversion Date, Interest Periods of six (6)
months shall only be permitted with the consent of all Lenders); provided that:
 (i)        the Interest Period shall commence on the date of advance of or conversion to
any LIBOR Rate Loan or any BA Loan and, in the case of immediately successive Interest Periods, each successive Interest Period shall commence on the date on which the immediately preceding Interest Period expires;
 (ii)       if any Interest Period would otherwise expire on a day that is not a Business Day,
such Interest Period shall expire on the next succeeding Business Day; provided, that if any Interest Period with respect to a LIBOR Rate Loan or a BA Loan would otherwise expire on a day that is not a
Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the immediately preceding Business Day;
 (iii)      any Interest Period with respect to a LIBOR Rate Loan or a BA Loan that begins on the
last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the relevant calendar month at the end of such
Interest Period;
 
	  
	 (iv)
	 no Interest
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 (v)       there shall be no more than (A) four (4) Interest Periods in effect at any time with
respect to LIBOR Rate Loans and (B) ten (10) Interest Periods in effect at any time with respect to BA Loans.
 (c)       Default Rate. Subject to Section 12.3, (i) immediately upon the occurrence and during the continuance of an Event of Default under Section 12.1(a),
(b), (i) or (j), or (ii) at the election of the Required Agreement Lenders, upon the occurrence and during the continuance of any other Event of Default, (A) the Borrower shall no longer have the option to request LIBOR Rate Loans, Swingline Loans,
BA Loans or Letters of Credit, (B) all outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two percent (2%) in excess of the rate then applicable thereto until the end of the applicable Interest Period and thereafter at a rate
equal to two percent (2%) in excess of the rate then applicable to (1) Canadian Prime Rate Loans (with respect to Revolving Credit Loans denominated in Canadian Dollars) or (2) Base Rate Loans (with respect to Revolving Credit Loans denominated in
Dollars), (C) all outstanding Canadian Prime Rate Loans and other Obligations denominated in Canadian Dollars arising hereunder or under any other Loan Document shall bear interest at a rate per annum equal to two percent (2%) in excess of the rate
then applicable to Canadian Prime Rate Loans and (D) all outstanding Base Rate Loans and other Obligations denominated in Dollars arising hereunder or under any other Loan Document shall bear interest at a rate per annum equal to two percent (2%) in
excess of the rate then applicable to Base Rate Loans. Interest shall continue to accrue on the Obligations after the filing by or against the Borrower of any petition seeking any relief in bankruptcy or under any act or law pertaining to insolvency
or debtor relief, whether state, federal or foreign.
 
	  
	 (d)
	 Interest
Payment and Computation.

 (i)        Interest on each Canadian Prime Rate Loan and each Base Rate Loan shall be due and payable in arrears on the last Business Day of each calendar quarter commencing September 30, 2006; and
interest on each LIBOR Rate Loan shall be due and payable on the last day of each Interest Period applicable thereto, and if such Interest Period extends over three (3) months, at the end of each three (3) month interval during such Interest Period.
Interest on LIBOR Rate Loans and all fees (except for Stamping Fees) shall be computed on the basis of a 360-day year and assessed for the actual number of days elapsed and interest on Canadian Prime Rate Loans, Base Rate Loans and Stamping Fees
shall be computed on the basis of a 365/366-day year and assessed for the actual number of days elapsed.
 (ii)       For purposes of the Interest Act (Canada) and disclosure thereunder, whenever any interest or fee to be paid hereunder or in connection herewith is to be calculated on the basis of any period of
time that is less than a calendar year, the yearly rate of interest to which the rate used in such calculation is equivalent is the rate so used multiplied by the actual number of days in the calendar year in which the same is to be ascertained and
divided by 365 or 366, as applicable. The rates of interest under this Agreement are nominal rates, and not effective rates or yields. The principle of deemed reinvestment of interest does not apply to any interest calculation under this Agreement.

    
  
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                 (e)          Maximum Rate.-
  

 (i)        In no contingency or event whatsoever shall the aggregate of all amounts deemed interest under this Agreement charged or collected pursuant to the terms of this Agreement exceed the highest
rate permissible under any Applicable Law which a court of competent jurisdiction shall, in a final determination, deem applicable hereto.
 (ii)       Notwithstanding the provisions of this Section 4.1 or any other provision of this
Agreement or any other Loan Document, in no event shall the aggregate "interest" (as such term is defined in Section 347 of the Criminal Code (Canada)) exceed the effective annual rate of interest on the "credit advanced" (as such term is defined in
Section 347 of the Criminal Code (Canada)) lawfully permitted under Section 347 of the Criminal Code (Canada). The effective annual rate of interest shall be determined in accordance with generally accepted actuarial practices and principles over
the term of the applicable Loan, and in the event of a dispute, a certificate of a Fellow of the Canadian Institute of Actuaries qualified for a period of ten (10) years and appointed by the Administrative Agent will be conclusive for the purposes
of such determination.
 (iii)      In the event that such a court determines that the
Lenders have charged or received interest hereunder in excess of the highest applicable rate, the rate in effect hereunder shall automatically be reduced to the maximum rate permitted by Applicable Law and the Lenders shall at the Administrative
Agent's option (A) promptly refund to the Borrower any interest received by the Lenders in excess of the maximum lawful rate or (B) apply such excess to the principal balance of the Obligations on a pro rata basis. It is the intent hereof that the Borrower not pay or contract to pay, and that neither the Administrative Agent nor any Lender receive or contract to receive, directly or indirectly in any manner whatsoever, interest in excess of that
which may be paid by the Borrower under Applicable Law.
 SECTION 4.2   Notice And Manner Of
Conversion Or Continuation Of Loans.
 (a)       Provided that no Default or Event of Default has
occurred and is then continuing, the Borrower shall have the option to:
 (i)        convert at any time all or any portion of any outstanding Canadian Prime Rate Loans (other than Swingline Loans) in a principal amount equal to C$3,000,000 or any whole multiple of
C$1,000,000 in excess thereof into one or more LIBOR Rate Loans denominated in Canadian Dollars;
 (ii)       convert at any time all or any portion of any outstanding Canadian Prime Rate Loans (other than Swingline Loans) in a principal amount equal to C$1,000,000 or a whole multiple of C$500,000 in
excess thereof into BA Loans;
 (iii)      upon the expiration of any Interest Period,
(A) convert all or any part of its outstanding LIBOR Rate Loans denominated in Canadian Dollars in a principal amount equal to C$1,000,000 or a whole multiple of C$500,000 in excess thereof into Canadian Prime Rate Loans (other than Swingline Loans)
or BA Loans, (B) continue such LIBOR Rate Loans as LIBOR Rate Loans, (C) convert all or any part of its outstanding BA
  
  
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 Loans in a principal amount equal to C$1,000,000 or a whole multiple of C$500,000 in excess thereof into Canadian Prime Rate Loans (other than
Swingline Loans), (D) convert all or any part of its outstanding BA Loans in a principal amount equal to C$3,000,000 or any whole multiple of C$1,000,000 in excess thereof into one or more LIBOR Rate Loans denominated in Canadian Dollars or (E)
continue such BA Loans as BA Loans;
 (iv)      convert at any time all or any portion
of any outstanding Base Rate Loans (other than Swingline Loans) in a principal amount equal to $3,000,000 or any whole multiple of $1,000,000 in excess thereof into one or more LIBOR Rate Loans denominated in Dollars; and
 (v)       upon the expiration of any Interest Period, (A) convert all or any part of its
outstanding LIBOR Rate Loans denominated in Dollars in a principal amount equal to $1,000,000 or a whole multiple of $500,000 in excess thereof into Base Rate Loans (other than Swingline Loans) or (B) continue such LIBOR Rate Loans as LIBOR Rate
Loans;
 provided that (1) with respect to any BA Loan, any conversion of a BA Loan shall be made on, and only on, the last day of
the Interest Period applicable thereto; (2) with respect to any BA Loan, in the event that a BA Loan is to be continued as a BA Loan, the BA Proceeds arising from the continued BA Loan shall be retained by the relevant Lender to be applied by it to
the face amount of the Bankers' Acceptance maturing on the date of such advance, and the Borrower shall pay to each Lender, on such date, an amount equal to the difference between the face amount at maturity of the maturing Bankers' Acceptance and
the BA Proceeds of the Bankers' Acceptance to be issued; and (3) with respect to any LIBOR Rate Loan or any BA Loan, if the Borrower fails to provide a Notice of Conversion/Continuation with respect to such Loan or any portion thereof prior to the
time period required below, such Loan shall be converted into a Base Rate Loan (if such Loan was denominated in Dollars) or a Canadian Prime Rate Loan (if such Loan was denominated in Canadian Dollars).
 (b)       Whenever the Borrower desires to convert or continue Revolving Credit Loans as provided above, the
Borrower shall give the Administrative Agent irrevocable prior written notice in the form attached as Exhibit E (a "Notice of Conversion/Continuation") not
later than 12:00 p.m. three (3) Business Days before the day on which a proposed conversion or continuation of such Loan is to be effective specifying (A) the Permitted Currency in which such Loan is denominated, (B) the Loans to be converted or
continued, and, in the case of any LIBOR Rate Loan or BA Loan to be converted or continued, the last day of the Interest Period therefor, (C) the effective date of such conversion or continuation (which shall be a Business Day), (D) the principal
amount of such Loans to be converted or continued, and (E) the Interest Period to be applicable to such converted or continued LIBOR Rate Loan or BA Loan. The Administrative Agent shall promptly notify the Lenders of such Notice of
Conversion/Continuation.
 
	  
	  
  
	  
  

  
  
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                 SECTION 4.3     Fees.
  

 (a)       Revolving Credit Commitment Fee. The Borrower shall pay to the Administrative Agent, for the account of the Lenders, a non-refundable commitment fee at a rate per annum equal to 1.00% on the average daily unused
portion of the Revolving Credit Commitments of all Lenders as in effect from time to time during the period commencing on the Tenth Amendment Effective Date and ending on the Maturity Date. The revolving credit commitment fee shall be payable for
each calendar quarter in arrears on the last Business Day of such calendar quarter during the term of this Agreement commencing with the calendar quarter ending December 31, 2008 and ending on the Maturity Date. Such revolving credit commitment fee
shall be distributed by the Administrative Agent to the Lenders pro rata in accordance with the Lenders' respective Revolving Credit Commitment Percentages.
 (b)       Duration Fee. The Borrower shall pay to the Administrative
Agent, for the account of the Tenth Amendment Consenting Lenders, a non-refundable duration fee in the amounts and on the dates set forth below:
  
 
	 Date of Payment
	 Amount of Duration Fee

	
March 15, 2009
	 0.50% on the Commitment of each Tenth Amendment Consenting Lender as in effect on March 15, 2009

	 April 14, 2009
	 0.50% on the Commitment of each Tenth Amendment Consenting Lender as in effect on April 14, 2009

 
 Such duration fee shall be distributed by the Administrative Agent
to the Tenth Amendment Consenting Lenders.
 
	  
	 (c)
	 Other Fees
.

 (i)        The Borrower
shall pay to the Administrative Agent, for the account of the Swingline Lender, a non-refundable commitment fee at a rate per annum equal to 1.00% on the average daily unused portion of the Swingline Commitment as in effect from time to time during
the period commencing on the Tenth Amendment Effective Date and ending on the Maturity Date (except that no such fee shall accrue during a Reallocation Period). The swingline commitment fee shall be payable for each calendar quarter in arrears on
the last Business Day of such calendar quarter during the term of this Agreement commencing with the calendar quarter ending December 31, 2008 and ending on the Maturity Date. Such swingline commitment fee shall be distributed by the Administrative
Agent to the Swingline Lender or shall be remitted directly by the Borrower to the Swingline Lender.
 (ii)       The Borrower agrees to pay any fees (and other expenses) as set forth in the Fee Letter.
 SECTION 4.4    Manner Of Payment.    (a)   Each payment by the Borrower on account of the principal of or interest on the Loans or of any fee, commission or other amounts (including the
Reimbursement Obligation) payable to the Lenders under this Agreement shall be made not later than 2:00 p.m. on the date specified for payment under this Agreement to the
  

  
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 Administrative Agent at the Administrative Agent's Office for the account of the Lenders (other than as set forth below) pro rata in accordance with their respective Commitment Percentages (except as specified below), in the applicable Permitted Currency, in immediately available funds and shall be made without any setoff, counterclaim or
deduction whatsoever. Any payment received after such time but before 3:00 p.m. on such day shall be deemed a payment on such date for the purposes of Section 12.1, but for all other purposes shall be deemed to have been made on the next succeeding
Business Day. Any payment received after 3:00 p.m. shall be deemed to have been made on the next succeeding Business Day for all purposes. Upon receipt by the Administrative Agent of each such payment, the Administrative Agent shall distribute to
each Lender at its Lending Office its pro rata share of such payment in accordance with such Lender's Commitment Percentage (except as specified below) and shall wire advice
of the amount of such credit to each Lender. Each payment to the Administrative Agent of the applicable Issuing Lender's fees or L/C Participants' commissions shall be made in like manner, but for the account of the applicable Issuing Lender or the
L/C Participants, as the case may be. Each payment to the Administrative Agent of Administrative Agent's fees or expenses shall be made for the account of the Administrative Agent and any amount payable to any Lender under Sections 4.9, 4.10, 4.11 or 14.3 shall be paid to the Administrative Agent for the account of the applicable Lender. Subject to Section 4.1(b)(ii), if any payment under this Agreement shall be specified to be made upon
a day which is not a Business Day, it shall be made on the next succeeding day which is a Business Day and such extension of time shall in such case be included in computing any interest if payable along with such payment.
 Notwithstanding anything to the contrary in this Section, to the extent that any Revolving Credit Loans made hereunder are made in accordance with the Revolving Credit
Commitment Percentages of the Lenders, payments with respect to such Revolving Credit Loans shall be allocated in accordance with the Revolving Credit Commitment Percentages of the Lenders.
  
 
	  
	 SECTION 4.5

	 Evidence
Of Indebtedness.

 (a)       Extensions of Credit
. The Extensions of Credit made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the Administrative Agent in the ordinary course of business. The accounts or records
maintained by the Administrative Agent and each Lender shall be conclusive absent manifest error of the amount of the Extensions of Credit made by the Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any
error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by any Lender
and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error. Upon the request of any Lender made through the Administrative
Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Revolving Credit Note and/or Swingline Note and/or Discount Note, as applicable, which shall evidence such Lender's Revolving Credit Loans and/or
Swingline Loans and/or BA Equivalent Loans, as applicable, in addition to such accounts or records. Each Lender may attach schedules to its Notes and endorse thereon the date, amount and maturity of its Loans and payments with respect
thereto.
  
  
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 (b)       Participations. In addition to the accounts and records referred to in subsection (a), each Lender and the Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swingline Loans. In the event of any conflict between the accounts and records maintained by the
Administrative Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error.
 
	  
	 SECTION 4.6

	 Adjustments.

 (a)       If any Lender shall, by exercising any
right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or other obligations hereunder resulting in such Lender's receiving payment of a proportion of the aggregate amount of its
Loans and accrued interest thereon or other such obligations (other than pursuant to Section 4.9, 4.10, 4.11 or 14.3 hereof) greater than its pro rata
 share thereof as provided herein, then the Lender receiving such greater proportion shall (i) notify the Administrative Agent of such fact, and (ii) purchase (for cash at face value) participations in the Loans and such
other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued
interest on their respective Loans and other amounts owing them; provided that:
 (A)      if any such participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and
 (B)      the provisions of this paragraph shall not be construed to apply to (1) any payment made by
the Borrower pursuant to and in accordance with the express terms of this Agreement or (2) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in Swingline Loans
and Letters of Credit to any assignee or participant, other than to the Borrower or any of its Subsidiaries (as to which the provisions of this paragraph shall apply).
 Each Credit Party consents to the foregoing and agrees, to the extent it may effectively do so under Applicable Law, that any Lender acquiring a participation pursuant to
the foregoing arrangements may exercise against each Credit Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of each Credit Party in the amount of such
participation.
 
	  
	 (b)
	 (i)
	 Notwithstanding anything to the contrary in this Agreement:

  
 (A)      the
Administrative Agent may at any time, and the Administrative Agent shall upon the termination of the Credit Facility pursuant to Section 12.2 or upon a request for refunding, or requirement for
participation, of any outstanding Swingline Loans pursuant to and in accordance with Section 2.2, concurrently (1) reallocate all outstanding Revolving Credit Loans in the applicable Permitted Currency
in which such Revolving Credit Loans were originally made such that
  
  
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 the aggregate principal amount of all outstanding Revolving Credit Loans shall be equal to each Lender's Revolving Credit Commitment Percentage (which
shall be determined based on the Revolving Credit Commitment applicable to each Lender during a Reallocation Period) of the aggregate principal amount of all outstanding Revolving Credit Loans at such time and (2) require all Swingline Loans to be
refunded, or participated, pursuant to, and in accordance with, Section 2.2;
  
 (B)      if the Credit Facility has not been terminated pursuant to Section 12.2
 and the Default or Event or Default, if any, which gave rise to the reallocations and refundings referred to in clause (A) above has been cured or waived, as applicable, then
the Administrative Agent shall, on the date of such cure or waiver, concurrently (1) reallocate all outstanding Revolving Credit Loans in the applicable Permitted Currency in which such Revolving Credit Loans were originally made such that the
aggregate principal amount of all outstanding Revolving Credit Loans shall be equal to each Lender's Revolving Credit Commitment Percentage (which shall be determined based on the Revolving Credit Commitment applicable to each Lender at any time
other than during a Reallocation Period) of the aggregate principal amount of all outstanding Revolving Credit Loans at such time and (2) reallocate that portion of the Swingline Loans which were refunded pursuant to, and in accordance with,
Section 2.2 or clause (A)(2) above (other than any portion of such Swingline Loans which were repaid by the Borrower) to the Swingline Lender as outstanding
Swingline Loans in the applicable Permitted Currency in which such Swingline Loans were originally made (which Swingline Loans shall bear interest at the Base Rate (with respect to any such Swingline Loans denominated in Dollars) or the Canadian
Base Rate (with respect to any such Swingline Loans denominated in Canadian Dollars)).
  
 In any such case set forth in clause (A) or clause
(B) above, (I) each applicable Lender shall make all such payments as the Administrative Agent shall request to give effect to such reallocation and such refunding (which such payments shall be net of any amount to be
received by such Lender), (II) all such payments shall be made in the applicable Permitted Currency immediately upon any such demand by the Administrative Agent but in no event later than 1:00 p.m. on the next succeeding Business Day after such
demand is made, (III) upon receipt of such payments, the Administrative Agent shall distribute the proceeds thereof to the applicable Lenders in the applicable Permitted Currency to give effect to the reallocation or refunding to which such proceeds
relate, (IV) no Lender's obligation to make any payment pursuant to this Section shall be affected by any other Lender's failure to make any payment required thereby, nor shall any Lender's payment obligation be increased as a result of any such
failure of any other Lender to fund its payment obligation. Furthermore, the Borrower agrees to be bound by any such adjustments and (V) each Lender acknowledges and agrees that its obligation to make such payments in accordance with the terms of
this Section is absolute and unconditional and shall not be affected by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions set forth in Article V at the time
of the applicable reallocation pursuant to this Section.
  
  

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 (ii)       The Borrower shall pay to each applicable Lender on demand, in the applicable
Permitted Currency, with notice to the Administrative Agent, the amount of the applicable Loans being reallocated pursuant to this Section to the extent amounts received from the other applicable Lenders are not sufficient to pay the amounts
required to be paid pursuant to the reallocations pursuant to this Section. In addition, the Borrower hereby authorizes any applicable Lender making such demand (with notice to the Administrative Agent and the Borrower) to charge any account
maintained by the Borrower with such Lender (up to the amount available therein) in order to immediately pay such Lender the amount of such reallocated Loans to the extent amounts received from the other applicable Lenders are not sufficient to pay
the amounts required to be paid pursuant to the reallocations pursuant to this Section. If any portion of any such amount paid to such Lender shall be recovered by or on behalf of the Borrower from such Lender in bankruptcy or otherwise, the loss of
the amount so recovered shall be ratably shared among all the Lenders in accordance with their respective Commitment Percentages.
 (iii)      Furthermore, if, prior to the reallocation described in clause
(b)(i)(A)(1) of this Section, one of the events described in Section 12.1(i) or (j) shall have occurred, the Swingline Lender
agrees and acknowledges that the Swingline Lender will purchase an undivided participating interest in the outstanding Revolving Credit Loans in an amount equal to its Commitment Percentage of the aggregate amount of such outstanding Revolving
Credit Loans. The Swingline Lender will immediately transfer to the Administrative Agent for the account of each Revolving Credit Lender (other than the Swingline Lender), in immediately available funds in the applicable Permitted Currency, the
amount of its participation and upon receipt thereof the Administrative Agent will (A) deliver to the Swingline Lender a certificate evidencing such participation dated the date of receipt of such funds and for the aggregate of such amounts and (B)
distribute the proceeds thereof to the applicable Lenders in the applicable Permitted Currency to give effect to such participation. Whenever, at any time after any Lender or the Administrative Agent has received from the Swingline Lender the
Swingline Lender's participating interest in a Revolving Credit Loan, such Lender or the Administrative Agent receives any payment on account thereof, such Lender or the Administrative Agent will distribute to the Swingline Lender its participating
interest in such amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which the Swingline Lender's participating interest was outstanding and funded).
 SECTION 4.7   NATURE OF OBLIGATIONS OF LENDERS REGARDING EXTENSIONS OF CREDIT; ASSUMPTION BY THE ADMINISTRATIVE
AGENT. THE OBLIGATIONS OF THE LENDERS UNDER THIS AGREEMENT TO MAKE THE REVOLVING CREDIT LOANS AND ISSUE OR PARTICIPATE IN SWINGLINE LOANS OR LETTERS OF CREDIT ARE SEVERAL AND ARE NOT JOINT OR JOINT AND SEVERAL. UNLESS THE ADMINISTRATIVE AGENT SHALL
HAVE RECEIVED NOTICE FROM A LENDER PRIOR TO A PROPOSED BORROWING DATE WITH RESPECT TO A LIBOR RATE LOAN OR A BA LOAN OR PRIOR TO 12:00 NOON ON A PROPOSED BORROWING DATE WITH RESPECT TO A CANADIAN PRIME RATE LOAN OR A BASE RATE LOAN THAT SUCH LENDER

  
  
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 WILL NOT MAKE AVAILABLE TO THE
ADMINISTRATIVE AGENT SUCH LENDER'S RATABLE PORTION OF THE AMOUNT TO BE BORROWED ON SUCH DATE (WHICH NOTICE SHALL NOT RELEASE SUCH LENDER OF ITS OBLIGATIONS HEREUNDER), THE ADMINISTRATIVE AGENT MAY ASSUME THAT SUCH LENDER HAS MADE SUCH PORTION
AVAILABLE TO THE ADMINISTRATIVE AGENT ON THE PROPOSED BORROWING DATE IN ACCORDANCE WITH SECTION 2.3(B), AND THE ADMINISTRATIVE AGENT MAY (BUT SHALL NOT BE REQUIRED TO), IN RELIANCE UPON SUCH ASSUMPTION, MAKE AVAILABLE TO THE BORROWER ON SUCH DATE A
CORRESPONDING AMOUNT. IF SUCH AMOUNT IS MADE AVAILABLE TO THE ADMINISTRATIVE AGENT ON A DATE AFTER SUCH BORROWING DATE, SUCH LENDER SHALL PAY TO THE ADMINISTRATIVE AGENT ON DEMAND AN AMOUNT, UNTIL PAID, EQUAL TO (A) WITH RESPECT TO ANY AMOUNT TO BE
BORROWED DENOMINATED IN DOLLARS, THE PRODUCT OF (I) THE AMOUNT NOT MADE AVAILABLE BY SUCH LENDER IN ACCORDANCE WITH THE TERMS HEREOF, MULTIPLIED BY (II) THE DAILY AVERAGE FEDERAL FUNDS RATE DURING SUCH PERIOD AS DETERMINED BY THE ADMINISTRATIVE
AGENT, MULTIPLIED BY (III) A FRACTION, THE NUMERATOR OF WHICH IS THE NUMBER OF DAYS THAT ELAPSE FROM AND INCLUDING SUCH BORROWING DATE TO THE DATE ON WHICH SUCH AMOUNT NOT MADE AVAILABLE BY SUCH LENDER IN ACCORDANCE WITH THE TERMS HEREOF SHALL HAVE
BECOME IMMEDIATELY AVAILABLE TO THE ADMINISTRATIVE AGENT, AND THE DENOMINATOR OF WHICH IS 360 AND (B) WITH RESPECT TO ANY AMOUNT TO BE BORROWED DENOMINATED IN CANADIAN DOLLARS, THE AMOUNT NOT MADE AVAILABLE BY SUCH LENDER IN ACCORDANCE WITH THE
TERMS HEREOF AND INTEREST THEREON AT A RATE PER ANNUM EQUAL TO THE ADMINISTRATIVE AGENT'S AGGREGATE MARGINAL COST (INCLUDING THE COST OF MAINTAINING ANY REQUIRED RESERVES OR DEPOSIT INSURANCE AND OF ANY FEES, PENALTIES, OVERDRAFT CHARGES OR OTHER
COSTS OR EXPENSES INCURRED BY THE ADMINISTRATIVE AGENT AS A RESULT OF THE FAILURE TO DELIVER FUNDS HEREUNDER) OF CARRYING SUCH AMOUNT. A CERTIFICATE OF THE ADMINISTRATIVE AGENT WITH RESPECT TO ANY AMOUNTS OWING UNDER THIS SECTION SHALL BE
CONCLUSIVE, ABSENT MANIFEST ERROR. IF SUCH LENDER'S REVOLVING CREDIT COMMITMENT PERCENTAGE OF SUCH BORROWING IS NOT MADE AVAILABLE TO THE ADMINISTRATIVE AGENT BY SUCH LENDER WITHIN THREE (3) BUSINESS DAYS AFTER SUCH BORROWING DATE, THE
ADMINISTRATIVE AGENT SHALL BE ENTITLED TO RECOVER SUCH AMOUNT MADE AVAILABLE BY THE ADMINISTRATIVE AGENT WITH INTEREST THEREON AT THE RATE PER ANNUM APPLICABLE TO BASE RATE LOANS HEREUNDER (WITH RESPECT TO ANY AMOUNT DENOMINATED IN DOLLARS) OR
CANADIAN PRIME RATE LOANS HEREUNDER (WITH RESPECT TO ANY AMOUNT DENOMINATED IN CANADIAN DOLLARS), IN EACH CASE, ON DEMAND, FROM THE BORROWER. THE FAILURE OF ANY LENDER TO MAKE AVAILABLE ITS REVOLVING CREDIT COMMITMENT PERCENTAGE OF
  
  
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 ANY
REVOLVING CREDIT LOAN REQUESTED BY THE BORROWER SHALL NOT RELIEVE IT OR ANY OTHER LENDER OF ITS OBLIGATION, IF ANY, HEREUNDER TO MAKE ITS REVOLVING CREDIT COMMITMENT PERCENTAGE OF SUCH REVOLVING CREDIT LOAN AVAILABLE ON THE BORROWING DATE, BUT NO
LENDER SHALL BE RESPONSIBLE FOR THE FAILURE OF ANY OTHER LENDER TO MAKE ITS REVOLVING CREDIT COMMITMENT PERCENTAGE OF SUCH REVOLVING CREDIT LOAN AVAILABLE ON THE BORROWING DATE.
 
	  
	 SECTION 4.8

  
	 Changed
Circumstances.
  

 (a)       Circumstances Affecting LIBOR Rate and BA Loan Availability. If with respect to any Interest Period the Administrative Agent or any Lender (after consultation with the Administrative Agent) shall determine that, by reason of circumstances affecting the foreign exchange and interbank markets
generally, deposits in eurodollars, Dollars or Canadian Dollars in the applicable amounts are not being quoted via Reuters Page LIBOR01 (or any successor page) or offered to the Administrative Agent or such Lender for such Interest Period then the
Administrative Agent shall forthwith give notice thereof to the Borrower. Thereafter, until the Administrative Agent notifies the Borrower that such circumstances no longer exist, the obligation of the Lenders to make such LIBOR Rate Loans or BA
Loans, as applicable, and the right of the Borrower to convert any Loan to or continue any Loan as a LIBOR Rate Loan or a BA Loan, as applicable, shall be suspended, and the Borrower shall repay in full (or cause to be repaid in full) the then
outstanding principal amount of each such LIBOR Rate Loan or each such BA Loan, as applicable, together with accrued interest thereon, on the last day of the then current Interest Period applicable to such LIBOR Rate Loan or such BA Loan, as
applicable, or convert the then outstanding principal amount of each such LIBOR Rate Loan or BA Loan, as applicable, to a Base Rate Loan (with respect to any such Loan denominated in Dollars) or a Canadian Prime Rate Loan (with respect to any such
Loan denominated in Canadian Dollars) as of the last day of such Interest Period.
 (b)       Laws Affecting LIBOR Rate and BA Loan Availability. If, after the date hereof, the introduction of, or any change in, any Applicable Law or any change
in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any of the Lenders (or any of their respective Lending
Offices) with any request or directive (whether or not having the force of law) of any such Governmental Authority, central bank or comparable agency, shall make it unlawful or impossible for any of the Lenders (or any of their respective Lending
Offices) to honor its obligations hereunder to make or maintain any LIBOR Rate Loan or any BA Loan, such Lender shall promptly give notice thereof to the Administrative Agent and the Administrative Agent shall promptly give notice to the Borrower
and the other Lenders. Thereafter, until the Administrative Agent notifies the Borrower that such circumstances no longer exist, (i) the obligations of the Lenders to make LIBOR Rate Loans or BA Loans and the right of the Borrower to convert any
Loan or continue any Loan as a LIBOR Rate Loan or a BA Loan shall be suspended and thereafter the Borrower may select only Base Rate Loans (with respect to any Loan denominated in Dollars) or Canadian Prime Rate Loans (with respect to any Loan
denominated in Canadian Dollars) hereunder, and (ii) if any of the Lenders may not lawfully continue to maintain a LIBOR Rate Loan or a BA Loan, as applicable, to the end of the
  

  
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 then current Interest Period applicable thereto as a LIBOR Rate Loan or a BA Loan, as applicable, the applicable LIBOR Rate Loan shall immediately be converted to a Base
Rate Loan (with respect to any such Loan denominated in Dollars) or a Canadian Prime Rate Loan (with respect to any such Loan denominated in Canadian Dollars) for the remainder of such Interest Period.
 (c)       Regulatory Limitations. In the event, as a result of
increases in the value of any Permitted Currency against the Dollar or for any other reason, the obligation of any of the Lenders to make Loans (taking into account the Dollar Amount of the Obligations and all other indebtedness required to be
aggregated under any Applicable Law) is determined by such Lender to exceed its then applicable legal lending limit under such Applicable Law, the amount of additional Extensions of Credit such Lender shall be obligated to make or issue or
participate in hereunder shall immediately be reduced to the maximum amount which such Lender may legally advance (as determined by such Lender), the obligation of each of the remaining Lenders hereunder shall be proportionately reduced, based on
their applicable Revolving Credit Commitment Percentages or Commitment Percentages, as applicable, and, to the extent necessary under such laws and regulations (as determined by each of the Lenders, with respect to the applicability of such laws and
regulations to itself), and the Borrower shall reduce, or cause to be reduced, complying to the extent practicable with the remaining provisions hereof, the Obligations outstanding hereunder by an amount sufficient to comply with such maximum
amounts.
 SECTION 4.9   INDEMNITY. THE BORROWER HEREBY INDEMNIFIES EACH OF THE LENDERS AGAINST ANY
LOSS OR EXPENSE WHICH MAY ARISE OR BE ATTRIBUTABLE TO EACH LENDER'S OBTAINING, LIQUIDATING OR EMPLOYING DEPOSITS OR OTHER FUNDS ACQUIRED TO EFFECT, FUND OR MAINTAIN ANY LOAN (A) AS A CONSEQUENCE OF ANY FAILURE BY THE BORROWER TO MAKE ANY PAYMENT
WHEN DUE OF ANY AMOUNT DUE HEREUNDER IN CONNECTION WITH A LIBOR RATE LOAN OR A BA LOAN, (B) DUE TO ANY FAILURE OF THE BORROWER TO BORROW, CONTINUE OR CONVERT ON A DATE SPECIFIED THEREFOR IN A NOTICE OF BORROWING OR NOTICE OF CONVERSION/CONTINUATION
OR (C) DUE TO ANY PAYMENT, PREPAYMENT OR CONVERSION OF ANY LIBOR RATE LOAN OR ANY BA LOAN ON A DATE OTHER THAN THE LAST DAY OF THE INTEREST PERIOD THEREFOR. THE AMOUNT OF SUCH LOSS OR EXPENSE SHALL BE DETERMINED, IN THE APPLICABLE LENDER'S SOLE
DISCRETION, BASED UPON THE ASSUMPTION THAT SUCH LENDER FUNDED ITS REVOLVING CREDIT COMMITMENT PERCENTAGE OR COMMITMENT PERCENTAGE, AS APPLICABLE, OF THE LIBOR RATE LOANS OR BA LOANS IN THE LONDON INTERBANK MARKET OR OTHER APPLICABLE MARKET AND USING
ANY REASONABLE ATTRIBUTION OR AVERAGING METHODS WHICH SUCH LENDER DEEMS APPROPRIATE AND PRACTICAL. A CERTIFICATE OF SUCH LENDER SETTING FORTH THE BASIS FOR DETERMINING SUCH AMOUNT OR AMOUNTS NECESSARY TO COMPENSATE SUCH LENDER SHALL BE FORWARDED TO
THE BORROWER THROUGH THE ADMINISTRATIVE AGENT AND SHALL BE CONCLUSIVELY PRESUMED TO BE CORRECT SAVE FOR MANIFEST ERROR."
  
  
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	 SECTION 4.10

  
	 Increased
Costs.
  

 
	  
	 (a)
	 Increased
Costs Generally. If any Change in Law shall:

 (i)        impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or advances,
loans or other credit extended or participated in by, any Lender (except any reserve requirement reflected in the LIBOR Rate) or an Issuing Lender;
 (ii)       subject any Lender or any Issuing Lender to any tax of any kind whatsoever with
respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any LIBOR Rate Loan or BA Loan made by it, or change the basis of taxation of payments to such Lender or such Issuing Lender in respect thereof (except for
Indemnified Taxes or Other Taxes covered by Section 4.11 and the imposition of, or any change in the rate of any Excluded Taxes payable by such Lender or such Issuing Lender); or
 (iii)      impose on any Lender or any Issuing Lender (or their respective Lending Offices) or the
London interbank or other applicable market any other condition, cost or expense affecting this Agreement or LIBOR Rate Loans or BA Loans made by such Lender or any Letter of Credit or participation therein;
 and the result of any of the foregoing shall be to increase the cost to such Lender of making, converting into or maintaining any LIBOR Rate Loan or BA Loan (or of
maintaining its obligation to make any such Loan), or to increase the cost to such Lender or such Issuing Lender of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any
Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or such Issuing Lender hereunder (whether of principal, interest or any other amount) then, upon written request of such Lender or such Issuing Lender, the
Borrower shall promptly pay to any such Lender or such Issuing Lender, as the case may be, such additional amount or amounts as will compensate such Lender or such Issuing Lender, as the case may be, for such additional costs incurred or reduction
suffered.
 (b)       Capital Requirements. If any
Lender or any Issuing Lender determines that any Change in Law affecting such Lender or such Issuing Lender or any lending office of such Lender or such Issuing Lender or such Lender's or such Issuing Lender's holding company, if any, regarding
capital requirements has or would have the effect of reducing the rate of return on such Lender's or such Issuing Lender's capital or on the capital of such Lender's or such Issuing Lender's holding company, if any, as a consequence of this
Agreement, the Commitment of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such Issuing Lender, to a level below that which such Lender or such Issuing Lender or
such Lender's or such Issuing Lender's holding company could have achieved but for such Change in Law (taking into consideration such Lender's or such Issuing Lender's policies and the policies of such Lender's or such Issuing Lender's holding
company with respect to capital adequacy), then from time to time upon written request of such Lender or such Issuing Lender the Borrower shall promptly pay to such Lender or such Issuing Lender, as the
  

  
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 case may be, such additional amount or amounts as will compensate such Lender or such Issuing Lender or such Lender's or such Issuing Lender's holding company for any
such reduction suffered.
 (c)       Certificates for
Reimbursement. A certificate of a Lender or an Issuing Lender setting forth the amount or amounts necessary to compensate such Lender or such Issuing Lender or its holding company, as the case may be, as specified in
paragraph (a) or (b) of this Section and delivered to the Borrower shall be conclusive absent manifest error. The Borrower shall pay such Lender or such Issuing Lender, as the case may be, the amount shown as due on any such certificate within ten
(10) days after receipt thereof.
 (d)       Exchange Indemnification and
Increased Costs. The Borrower shall, upon demand from the Administrative Agent, pay to the Administrative Agent or any applicable Lender, the amount of (i) any loss or cost or increased cost incurred by the Administrative
Agent or any applicable Lender, (ii) any reduction in any amount payable to or in the effective return on the capital to the Administrative Agent or any applicable Lender or (iii) any currency exchange loss, that Administrative Agent or any Lender
sustains as a result of any payment being made by the Borrower in a currency other than that originally extended to the Borrower. A certificate of the Administrative Agent or the applicable Lender, as the case may be, setting forth in reasonable
detail the basis for determining such additional amount or amounts necessary to compensate the Administrative Agent or the applicable Lender shall be conclusively presumed to be correct save for manifest error
 (e)       Delay in Requests. Failure or delay on the part of any
Lender or any Issuing Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender's or such Issuing Lender's right to demand such compensation; provided that the
Borrower shall not be required to compensate a Lender or an Issuing Lender pursuant to this Section for any increased costs incurred or reductions suffered more than nine (9) months prior to the date that such Lender or such Issuing Lender, as the
case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender's or such Issuing Lender's intention to claim compensation therefor (except that if the Change in Law giving rise to such
increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).
 
	  
	  
	  

                            SECTION 4.11      Taxes.
  
 (a)       Payments Free of Taxes. Any and all payments by or on account of any obligation of the Borrower hereunder or under any other Loan Document shall be
made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be required by Applicable Law to deduct any Indemnified Taxes
(including any Other Taxes) from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative
Agent, Lender or Issuing Lender, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall timely pay the full amount
deducted to the relevant Governmental Authority in accordance with Applicable Law.
  
  
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 (b)       Payment of Other Taxes by the Borrower. Without limiting
the provisions of paragraph (a) above, the Borrower shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.
 (c)       Indemnification by the Borrower. The Borrower shall
indemnify the Administrative Agent, each Lender and each Issuing Lender, within ten (10) days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) paid by the Administrative Agent, such Lender or such Issuing Lender, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or
not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender or an Issuing Lender
(with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender or an Issuing Lender, shall be conclusive absent manifest error.
 (d)       Evidence of Payments. As soon as practicable after any
payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such
payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
 (e)       Status of Lenders. Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which
the Borrower is resident for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments hereunder or under any other Loan Document shall deliver to the Borrower (with a copy to the Administrative Agent), at the time
or times prescribed by Applicable Law or reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation prescribed by Applicable Law as will permit such payments to be made without withholding or
at a reduced rate of withholding. In addition, any Lender, if requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by Applicable Law or reasonably requested by the Borrower or the Administrative
Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements.
 Without limiting the obligations of the Lenders set forth above regarding delivery of certain forms and documents to establish each Lender's status
for Canadian withholding tax purposes, each Lender agrees promptly to deliver to the Administrative Agent or the Borrower as the Administrative Agent or the Borrower shall reasonably request, on or prior to the Closing Date, and in a timely fashion
thereafter, such other documents and forms required by any relevant taxing authorities under the Applicable Laws of any other jurisdiction, duly executed and completed by such Lender, as are required under such Applicable Laws to confirm such
Lender's entitlement to any available exemption from, or reduction of, applicable withholding taxes in respect of all payments to be made to such Lender outside of Canada by the Borrower pursuant to this Agreement, the other Loan Documents or
otherwise to establish such Lender's status for withholding tax purposes in such other jurisdiction. Each Lender shall promptly (i) notify the Administrative Agent of any change in circumstances which would modify or render
  

  
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 invalid any such claimed exemption or reduction, and (ii) take such steps as shall not be materially disadvantageous to it, in the reasonable judgment of such Lender, and
as may be reasonably necessary (including the re-designation of its Lending Office) to avoid any requirement of Applicable Laws of any such jurisdiction that the Borrower make any deduction or withholding for taxes from amounts payable to such
Lender. Additionally, the Borrower shall promptly deliver to the Administrative Agent or any Lender, as the Administrative Agent or such Lender shall reasonably request, on or prior to the Closing Date, and in a timely fashion thereafter, such
documents and forms required by any relevant taxing authorities under the Applicable Laws of any jurisdiction, duly executed and completed by the Borrower, as are required to be furnished by such Lender or the Administrative Agent under such
Applicable Laws in connection with any payment by the Administrative Agent or any Lender of Taxes or Other Taxes, or otherwise in connection with the Loan Documents, with respect to such jurisdiction.
 (f)        Treatment of Certain Refunds. If the Administrative
Agent, a Lender or an Issuing Lender determines, in its sole discretion, that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts
pursuant to this Section, it shall pay to the Borrower an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower under this Section with respect to the Taxes or Other Taxes giving
rise to such refund), net of all out-of-pocket expenses of the Administrative Agent, such Lender or such Issuing Lender, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to
such refund); provided that the Borrower, upon the request of the Administrative Agent, such Lender or such Issuing Lender, agrees to repay the amount paid over to the Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent, such Lender or such Issuing Lender in the event the Administrative Agent, such Lender or such
Issuing Lender is required to repay such refund to such Governmental Authority. This paragraph shall not be construed to require the Administrative Agent, any Lender or any Issuing Lender to make available its tax returns (or any other information
relating to its taxes which it deems confidential) to the Borrower or any other Person.
 (g)       
Survival. Without prejudice to the survival of any other agreement of the Borrower hereunder, the agreements and obligations of the Borrower contained in this Section shall survive the payment in full
of the Obligations and the termination of the Commitment.
 SECTION 4.12      Mitigation
Obligations; Replacement Of Lenders.
 (a)       Designation of a Different
Lending Office. If any Lender requests compensation under Section 4.10, or requires the Borrower to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 4.11,
then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment
of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 4.10 or Section 4.11, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or
expense
  
  
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 and would not otherwise be disadvantageous to such
Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.
 (b)       Replacement of Lenders. If any Lender requests
compensation under Section 4.10, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 4.11, or if any Lender defaults in its obligation to fund
Loans hereunder, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions
contained in, and consents required by, Section 14.10), all of its interests, rights and obligations under this Agreement and the related Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided that:
 (i)        the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 14.10;
 (ii)       such Lender shall have received payment of an amount equal to the outstanding
principal of its Loans and participations in Letters of Credit, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 4.9
) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);
 (iii)      in the case of any such assignment resulting from a claim for compensation under Section
4.10 or payments required to be made pursuant to Section 4.11, such assignment will result in a reduction in such compensation or payments thereafter; and
 
	  
	 (iv)
	 such
assignment does not conflict with Applicable Law.

 A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
                            SECTION
4.13      Security. The Obligations of the Borrower shall be secured as provided in the Security Documents.
                            SECTION 4.14      Additional Subsidiary
Borrowers. The Borrower may designate any Domestic Subsidiary as a Subsidiary Borrower under this Agreement and the other Loan Documents upon satisfaction of each of the following conditions.
 (a)       The Borrower shall have delivered to the Administrative Agent a written notice requesting that such
Domestic Subsidiary be designated as a new Subsidiary Borrower. The Administrative Agent agrees that promptly upon receipt of such notice it will forward such notice to the Lenders requesting their approval of such Domestic Subsidiary as a
Subsidiary Borrower. If the Required Agreement Lenders approve such designation (which approval shall occur no earlier than five (5) Business Days after the Lenders receive written notice of the
  

  
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 request that such Domestic Subsidiary be designated as a new Subsidiary Borrower), the applicable Domestic Subsidiary shall be deemed a "Borrower" under this Agreement
and the other Loan Documents and all references herein (other than the references in Article V, Article VI, Article VII, Article VIII, Article IX and Article X of this Agreement) to "Borrower" shall be deemed to include the Subsidiary
Borrower.
 (b)       The Administrative Agent shall have received a duly executed supplement to this
Agreement and any other applicable Loan Documents joining such Domestic Subsidiary as a Subsidiary Borrower hereunder (such supplement to be in form and substance reasonably satisfactory to the Administrative Agent).
 (c)       Such Domestic Subsidiary shall deliver to the Administrative Agent such documents and certificates
referred to in Section 5.2 as may be reasonably requested by the Administrative Agent (it being agreed by the Borrower that, if the designation of such Domestic Subsidiary as a Subsidiary Borrower obligates the Administrative Agent or any Lender to
comply with "know your customer" or similar identification procedures in circumstances where the necessary information is not already available to it, the Borrower shall, promptly upon the request of the Administrative Agent or any Lender, supply
such documentation and other evidence as is reasonably requested by the Administrative Agent or any Lender in order for the Administrative Agent or such Lender to carry out, and be satisfied it has complied with the results of, all necessary "know
your customer" or other similar checks under all Applicable Laws).
 (d)       (i)        If not previously granted to the Administrative Agent under the Security Documents, such Domestic Subsidiary shall pledge a security interest
in all Collateral owned by such Domestic Subsidiary by delivering to the Administrative Agent a duly executed supplement to each applicable Security Document or such other documents as the Administrative Agent shall reasonably deem appropriate for
such purpose.
 (ii)       To the extent not previously delivered to the
Administrative Agent under the Security Documents, the Borrower shall deliver to the Administrative Agent such original Capital Stock or other certificates and stock or other transfer powers evidencing the Capital Stock of such Domestic Subsidiary
and, to the extent required by the Security Documents, all Capital Stock or other certificates and stock or other transfer powers evidencing the Capital Stock owned by such Domestic Subsidiary.
 (e)       The Borrower shall deliver to the Administrative Agent such updated Schedules to the Loan Documents as
requested by the Administrative Agent with respect to such Domestic Subsidiary.
 (f)        The
Borrower shall deliver to the Administrative Agent such other documents (including, without limitation, legal opinions) as may be reasonably requested by the Administrative Agent, all in form, content and scope reasonably satisfactory to the
Administrative Agent.
  
  
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 (g)       The obligations of each Subsidiary Borrower hereunder and under the other Loan Documents shall be joint and several with the Obligations of the Borrower and each other Subsidiary
Borrower.
 ARTICLE V
  
 CLOSING; CONDITIONS OF CLOSING AND BORROWING
 SECTION
5.1 Closing. The closing shall take place at the offices of Kennedy Covington Lobdell & Hickman, L.L.P. at 10:00 a.m. on May 31, 2006 or at such other place, date and time as the parties hereto shall mutually agree.
 SECTION 5.2 Conditions To Closing And Initial Extensions Of Credit. The obligation of the Lenders to close this Agreement and to make the
initial Loan or issue or participate in the initial Letter of Credit, if any, is subject to the satisfaction of each of the following conditions:
 (a)       Executed Loan Documents. This Agreement, a Revolving
Credit Note in favor of each Lender (if requested thereby), a Swingline Note in favor of the Swingline Lender (if requested thereby), a Discount Note in favor of each Non-BA Lender (if requested thereby) and the Security Documents, together with any
other applicable Loan Documents, shall have been duly authorized, executed and delivered to the Administrative Agent by the parties thereto, shall be in full force and effect and no Default or Event of Default shall exist hereunder or thereunder.

 (b)       Closing Certificates; Etc. The
Administrative Agent shall have received each of the following in form and substance reasonably satisfactory to the Administrative Agent:
 (i)        Officer's Certificate of the Original U.S. Borrower. A certificate from a Responsible Officer of the Original U.S. Borrower to the effect that
all representations and warranties of the Original U.S. Borrower and its Subsidiaries contained in this Agreement and the other Loan Documents are true, correct and complete in all material respects (provided that any representation or warranty that is qualified by materiality or by reference to Material Adverse Effect shall be true, correct and complete in all respects); that neither the Original U.S. Borrower nor any of its Subsidiaries is in
violation of any of the covenants contained in this Agreement and the other Loan Documents; that, after giving effect to the transactions contemplated by this Agreement, no Default or Event of Default has occurred and is continuing; and that each of
the Credit Parties, as applicable, has satisfied each of the conditions set forth in Section 5.2 and Section 5.3.
 (ii)       Certificate of Secretary of each Credit Party. A certificate of a Responsible Officer of each Credit Party certifying as to the incumbency and
genuineness of the signature of each officer of such Credit Party executing Loan Documents to which it is a party and certifying that attached thereto is a true, correct and complete copy of (A) the articles or certificate of incorporation or
formation (or equivalent documentation) of such Credit Party and all amendments thereto, certified as of a recent date by the appropriate Governmental Authority in its jurisdiction of incorporation or formation, (B) the bylaws or other governing
document (or equivalent documentation) of such Credit Party as in effect on the Closing Date, (C) resolutions
  
  
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 duly adopted by the board of directors or other governing body of such Credit Party authorizing the transactions contemplated hereunder and the execution, delivery and
performance of this Agreement and the other Loan Documents to which it is a party, and (D) each certificate required to be delivered pursuant to Section 5.2(b)(iii).
 (iii)      Certificates of Good Standing. Certificates as of a recent date
of the good standing (or equivalent documentation) of each Credit Party under the laws of its jurisdiction of organization and, to the extent requested by the Administrative Agent, each other jurisdiction where such Credit Party is qualified to do
business and, to the extent available, a certificate of the relevant taxing authorities of such jurisdictions certifying that such Credit Party has filed required tax returns and owes no delinquent taxes.
 (iv)      Opinions of Counsel. Favorable opinions of counsel to the Credit
Parties (including, without limitation, applicable local counsel in the State of New York, the provinces of Québec, Ontario, Nova Scotia and New Brunswick, and any other applicable jurisdiction) addressed to the Administrative Agent and the
Lenders with respect to the Credit Parties, the Loan Documents and such other matters as the Lenders shall request.
              (c)          Personal Property Collateral. 
 
	  
	  
	  

 (i)        Filings and Recordings. The
Administrative Agent shall have received all filings and recordations that are necessary to perfect the security interests of the Administrative Agent, on behalf of itself and the Lenders, in the Collateral shall have been received by the
Administrative Agent and the Administrative Agent shall have received evidence reasonably satisfactory to the Administrative Agent that upon such filings and recordations such security interests constitute valid and perfected first priority Liens
thereon.
 (ii)       Lien Search. The Administrative
Agent shall have received the results of a Lien search (including a search as to judgments, pending litigation and tax matters), in form and substance reasonably satisfactory thereto, made against each of the Credit Parties (other than the U.S.
Borrower) under the PPSA and the CCQ (or applicable judicial docket) as in effect in any province in which any of the assets of such Credit Party are located, indicating among other things that its assets are free and clear of any Lien except for
Permitted Liens.
 (iii)      Hazard and Liability Insurance.
The Administrative Agent shall have received certificates of property hazard, business interruption and liability insurance, evidence of payment of all insurance premiums for the current policy year of each insurance policy (naming the
Administrative Agent as additional insured on all certificates for liability insurance and loss payee with respect to the Collateral on all certificates for property insurance), and, if requested by the Administrative Agent, copies (certified by a
Responsible Officer) of insurance policies in the form required under the Security Documents and otherwise in form and substance reasonably satisfactory to the Administrative Agent.
  
 
	  
	  
	  

              (d)          Consents; Defaults. 
  
 (i)        Governmental and Third Party Approvals. The Credit
Parties shall have received all material governmental, shareholder and third party consents and approvals necessary (or any other material consents as determined in the reasonable discretion of the Administrative
  

  
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 Agent) in connection with the transactions contemplated by this Agreement and the other Loan Documents and the other transactions contemplated hereby and all applicable
waiting periods shall have expired without any action being taken by any Person that could reasonably be expected to restrain, prevent or impose any material adverse conditions on any of the Credit Parties or such other transactions or that could
seek or threaten any of the foregoing, and no law or regulation shall be applicable which in the reasonable judgment of the Administrative Agent could reasonably be expected to have such effect.
 (ii)       No Injunction, Etc. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed before any Governmental Authority to enjoin, restrain, or prohibit, or to obtain substantial damages in respect of, or which is related to or arises out of this Agreement
or the other Loan Documents or the consummation of the transactions contemplated hereby or thereby, or which, in the Administrative Agent's sole discretion, would make it inadvisable to consummate the transactions contemplated by this Agreement or
the other Loan Documents or the consummation of the transactions contemplated hereby or thereby.
                 
(e)          Financial Matters. 
  
 (i)        Financial Statements. The Administrative Agent shall have received (A) the audited Consolidated balance sheet of the Original U.S. Borrower and
its Subsidiaries as of December 31, 2005 and the related audited statements of income and retained earnings and cash flows for the Fiscal Year then ended, (B) any interim unaudited Consolidated balance sheet of the Original U.S. Borrower and its
Subsidiaries and related unaudited interim statements of income, cash flows and retained earnings for each interim quarterly period (if any) ended at least forty-five (45) days prior to the Closing Date, (C) the audited Consolidated balance sheet of
the Borrower and its Subsidiaries as of December 31, 2005 and the related audited statements of income and retained earnings and cash flows for the Fiscal Year then ended and (D) any interim unaudited Consolidated balance sheet of the Borrower and
its Subsidiaries and related unaudited interim statements of income, cash flows and retained earnings for each interim quarterly period (if any) ended at least forty-five (45) days prior to the Closing Date.
 (ii)       Financial Projections. The Administrative Agent shall have
received projections prepared by management of the Original U.S. Borrower, of balance sheets, income statements and cash flow statements on a quarterly basis for 2006 and on an annual basis for each year thereafter during the term of the U.S. Credit
Facility.
 (iii)      Financial Condition Certificate. The
Original U.S. Borrower shall have delivered to the Administrative Agent a certificate, in form and substance satisfactory to the Administrative Agent, and certified as accurate by a Responsible Officer of the Original U.S. Borrower, that (A) the
Original U.S. Borrower and each of its Subsidiaries are each Solvent, (B) the material payables of the Original U.S. Borrower and each of its Subsidiaries are current and not past due, (C) attached thereto are calculations, as determined on a
pro forma basis as of March 31, 2006 and after giving effect to the transactions contemplated hereby and any Extensions of Credit or U.S. Extensions of Credit to be made on the
Closing Date, with the covenants contained in Article IX; (D) the financial projections previously delivered to the Administrative Agent represent the good faith estimates (utilizing assumptions believed to be
  

  
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 reasonable) of the financial condition and operations of the Original U.S. Borrower and its Subsidiaries; (E) attached thereto is a calculation of the ratio of (1)
Consolidated Total Indebtedness as of the Closing Date (after giving effect to any Extensions of Credit or U.S. Extensions of Credit on the Closing Date) to (2) Consolidated EBITDA for the most recently ended four (4) consecutive fiscal quarters for
which financial statements have been delivered, demonstrating that such ratio is less than 5.80 to 1.00; (F) attached thereto is a calculation of Consolidated Adjusted EBITDA for the most recently ended four (4) consecutive fiscal quarters for which
financial statements have been delivered, demonstrating to the reasonable satisfaction of the Administrative Agent that Consolidated Adjusted EBITDA (as determined in such manner) is not less than $500,000,000; and (G) attached thereto is a
calculation of the Borrowing Limit as of the Closing Date.
 (iv)      Payment at
Closing; Fee Letters. The Borrower shall have paid to the Administrative Agent and the Lenders the fees set forth or referenced in Section 4.3 and any other accrued and unpaid fees or commissions due hereunder (including,
without limitation, legal (including, without limitation, local counsel) fees and expenses) and to any other Person such amount as may be due thereto in connection with the transactions contemplated hereby, including all taxes, fees and other
charges in connection with the execution, delivery, recording, filing and registration of any of the Loan Documents.
 
	  
	 (f)
	 Miscellaneous.

 (i)        Notice of Borrowing. The Administrative Agent shall have received a Notice of Borrowing from the Borrower in accordance with Section 2.3(a) with respect to any Loans (if
any) to be made on the Closing Date, and a Notice of Account Designation specifying the account or accounts to which the proceeds of any Loans made on or after the Closing Date are to be disbursed.
 (ii)       Existing Facilities. Each of the Existing Facilities shall
be repaid in full and terminated and all collateral security therefor shall be released, and the Administrative Agent shall have received pay-off letters in form and substance satisfactory to it evidencing such repayment, termination and release.

 (iii)      Closing of the U.S. Credit Facility. The U.S.
Credit Facility shall simultaneously close on the Closing Date.
 (iv)      Other
Documents. All opinions, certificates and other instruments and all proceedings in connection with the transactions contemplated by this Agreement shall be satisfactory in form and substance to the Administrative Agent. The
Administrative Agent shall have received copies of all other documents, certificates and instruments reasonably requested thereby, with respect to the transactions contemplated by this Agreement.
 SECTION 5.3    Conditions To All Extensions Of Credit. The obligations of the Lenders to make any Extensions of Credit
(including any initial Extensions of Credit), convert or continue any Loan and/or any Issuing Lender to issue or extend any Letter of Credit are subject to the satisfaction of the following conditions precedent on the relevant borrowing,
continuation, conversion, issuance or extension date:
  
  
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 (a)       Continuation of Representations and Warranties. The representations and warranties contained in Article VI shall be true and correct in all material
respects on and as of such borrowing, continuation, conversion, issuance or extension date with the same effect as if made on and as of such date, except for any representation and warranty made as of an earlier date, which representation and
warranty shall remain true and correct as of such earlier date; provided that any representation or warranty that is qualified by materiality or by reference to Material Adverse Effect shall be true and
correct in all respects on and as of such borrowing, continuation, conversion, issuance or extension date.
 (b)       No Existing Default. No Default or Event of Default shall have occurred and be continuing (i) on the borrowing, continuation or conversion date with
respect to such Loan or after giving effect to the Loans to be made, continued or converted on such date or (ii) on the issuance or extension date with respect to such Letter of Credit or after giving effect to the issuance or extension of such
Letter of Credit on such date.
 (c)       Notices. The
Administrative Agent shall have received a Notice of Borrowing or Notice of Conversion/Continuation, as applicable, from the Borrower in accordance with Section 2.3(a) or Section 4.2, as applicable.

 (d)       Maximum Cash Balance. As of the end of the
Business Day immediately preceding the date of any such borrowing, conversion, continuation, issuance or extension and after giving effect to the Borrower's receipt of the proceeds from any such Loan, as the case may be, and the application of such
proceeds, the aggregate amount of cash and Cash Equivalents of the U.S. Borrower and its Subsidiaries shall not exceed $70,000,000.
 
	  
	  
	  

                  SECTION
5.4        Post-Closing Conditions.

  
 (a)       Prior to June 30, 2006, as such date may be extended by the Administrative Agent in its sole discretion, the Administrative Agent shall have received the following control agreements, in each case
in form and substance satisfactory to the Administrative Agent:
 (i)        A
deposit account control agreement executed by the Borrower, the Administrative Agent and National Bank of Canada with respect to all Deposit Accounts, other than Excluded Deposit Accounts (in each case as defined in the Collateral Agreement), of the
Borrower at National Bank of Canada;
 (ii)       A deposit account control
agreement executed by the Borrower, the Administrative Agent and The Toronto-Dominion Bank with respect to all Deposit Accounts, other than Excluded Deposit Accounts (in each case as defined in the Collateral Agreement), of the Borrower at The
Toronto-Dominion Bank;
 (iii)      A deposit account control agreement executed by the
Borrower, the Administrative Agent and Bank of America, N.A. with respect to all Deposit Accounts, other than Excluded Deposit Accounts (in each case as defined in the Collateral Agreement), of the Borrower at Bank of America, N.A.;
 (iv)      A deposit account control agreement executed by the Borrower, the Administrative Agent and
Bank of Montreal with respect to all Deposit Accounts, other
  
  
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 than Excluded Deposit Accounts (in each case as defined in the Collateral Agreement), of the Borrower at Bank of Montreal;
 (v)       All other control agreements which the Administrative Agent requires to be delivered
pursuant to the Collateral Agreement, in each case in form and substance satisfactory to the Administrative Agent.
 (b)       Prior to June 30, 2006, as such date may be extended by the Administrative Agent in its sole discretion, the Administrative Agent shall have received any warehouse or similar agreement, and any
other ancillary documentation, required to be delivered thereto pursuant to Section 4.6(b) of the Collateral Agreement (or, if any such warehouse or similar agreement, and any other ancillary
documentation, has not been delivered by such date, the Borrower shall take all actions required by the Administrative Agent pursuant to Section 4.6(b) in connection therewith).
 ARTICLE VI
  
 REPRESENTATIONS AND WARRANTIES OF THE BORROWER
 SECTION
6.1   Representations And Warranties. To induce the Administrative Agent and Lenders to enter into this Agreement and to induce the Lenders to make Extensions of Credit, each of the Borrower and the U.S. Borrower hereby represents
and warrants to the Administrative Agent and Lenders both before and after giving effect to the transactions contemplated hereunder that:
 (a)       Organization; Power; Qualification. Each of the U.S. Borrower and its Subsidiaries is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or formation, has the power and authority to own its properties and to carry on its business as now being and hereafter proposed to be conducted and is duly qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature of its business requires such qualification and authorization except in jurisdictions where the failure to be so qualified or in good standing could not reasonably be expected
to result in a Material Adverse Effect.
 (b)       Ownership. Each Subsidiary of the U.S. Borrower as of the Closing Date is listed on Schedule 6.1(b) together with (i) its jurisdiction of formation and each jurisdiction in which it is qualified to do
business as of the Closing Date, (ii) each Person holding ownership interests in such Subsidiary, (iii) the nature of the ownership interest held by each such Person and the percentage of ownership of such Subsidiary represented by such ownership
interests and (iv) a designation of each Subsidiary that is inactive. All outstanding shares have been duly authorized and validly issued and are fully paid and nonassessable, with no personal liability attaching to the ownership thereof, and not
subject to any preemptive or similar rights, except as described in Schedule 6.1(b). As of the Closing Date, there are no outstanding stock purchase warrants, subscriptions, options, securities,
instruments or other rights of any type or nature whatsoever, which are convertible into, exchangeable for or otherwise provide for or permit the issuance of Capital Stock of the U.S. Borrower or its Subsidiaries, except as described on
Schedule 6.1(b).
  
  

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 (c)       Authorization of Agreement, Loan Documents and Borrowing. Each of the U.S. Borrower and its Subsidiaries has the right, power and authority and has
taken all necessary corporate and other action to authorize the execution, delivery and performance of this Agreement and each of the other Loan Documents to which it is a party in accordance with their respective terms. This Agreement and each of
the other Loan Documents have been duly executed and delivered by the duly authorized officers of the U.S. Borrower and each of its Subsidiaries party thereto, and each such document constitutes the legal, valid and binding obligation of the U.S.
Borrower or its Subsidiary party thereto, enforceable in accordance with its terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or similar state or federal laws from time to time in effect
which affect the enforcement of creditors' rights in general and (ii) the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
 (d)       Compliance of Agreement, Loan Documents and Borrowing with Laws, Etc.
The execution, delivery and performance by the U.S. Borrower and its Subsidiaries of the Loan Documents to which each such Person is a party, in accordance with their respective terms, the Extensions of Credit hereunder and the
transactions contemplated hereby or thereby do not and will not, by the passage of time, the giving of notice or otherwise, (i) require any Governmental Approval or violate any Applicable Law relating to the U.S. Borrower or any of its Subsidiaries,
(ii) conflict with, result in a breach of or constitute a default under the articles of incorporation, bylaws or other organizational documents of the U.S. Borrower or any of its Subsidiaries, (iii) conflict with, result in a breach of or constitute
a default under any indenture, agreement or other instrument to which such Person is a party or by which any of its properties may be bound or any Governmental Approval relating to such Person, which could reasonably be expected to have a Material
Adverse Effect, (iv) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by such Person other than Liens arising under the Loan Documents or (v) require any consent or
authorization of, filing with, or other act in respect of, an arbitrator or Governmental Authority and no consent of any other Person is required in connection with the execution, delivery, performance, validity or enforceability of this Agreement
other than consents, authorizations, filings or other acts or consents for which the failure to obtain or make could not reasonably be expected to have a Material Adverse Effect and other than consents or filings under the PPSA and the
CCQ.
 (e)       Compliance with Law; Governmental Approvals. Each of the U.S. Borrower and its Subsidiaries (i) has all Governmental Approvals required by any Applicable Law for it to conduct its business, each of which is in full force and effect, is final and not subject to review on appeal and is
not the subject of any pending or, to the best of its knowledge, threatened attack by direct or collateral proceeding, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect, (ii) is in compliance with
its articles of incorporation, bylaws or other organizational documents of the U.S. Borrower or any of its Subsidiaries, except where the failure to comply could not reasonably be expected to have a Material Adverse Effect, (iii) is in compliance
with each Governmental Approval applicable to it and in compliance with all other Applicable Laws relating to it or any of its respective properties, except where the failure to comply could not reasonably be expected to have a Material Adverse
Effect, and (iv) has timely filed all reports, documents and other materials required to be filed by it under all Applicable Laws with any Governmental Authority and has retained all records and
  

  
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 documents required to be retained by it under Applicable Law, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
 (f)        Tax Returns and
Payments. Each of the U.S. Borrower and its Subsidiaries has duly filed or caused to be filed all federal and other material tax returns required by Applicable Law to be filed, and has paid, or made adequate provision for the
payment of, all federal and other material taxes, assessments and governmental charges or levies upon it and its property, income, profits and assets which are due and payable. Such returns accurately reflect in all material respects all liability
for taxes of the U.S. Borrower and its Subsidiaries for the periods covered thereby. There is no ongoing audit or examination or, to the knowledge of the Borrower or the U.S. Borrower, other investigation by any Governmental Authority of the tax
liability of the U.S. Borrower and its Subsidiaries, except, in each case, as could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. No Governmental Authority has asserted any Lien or other claim
against the U.S. Borrower or any of its Subsidiaries with respect to unpaid taxes which has not been discharged or resolved other than Permitted Liens. The charges, accruals and reserves on the books of the U.S. Borrower and any of its Subsidiaries
in respect of federal and other material taxes for all Fiscal Years and portions thereof since the organization of the U.S. Borrower and any of its Subsidiaries are in the judgment of the U.S. Borrower adequate, and the U.S. Borrower does not
anticipate any material amount of additional taxes or assessments for any of such years.
 (g)       
Intellectual Property Matters. Each of the U.S. Borrower and its Subsidiaries owns or possesses rights to use all franchises, licenses, copyrights, copyright applications, patents, patent rights or
licenses, patent applications, trademarks, trademark rights, service mark, service mark rights, trade names, trade name rights, copyrights and other rights with respect to the foregoing which are reasonably necessary to conduct its business, except
where the failure to own or possess such rights, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. No event has occurred which permits, or after notice or lapse of time or both would permit, the
revocation or termination of any such rights, and neither the U.S. Borrower nor any of its Subsidiaries is liable to any Person for infringement under Applicable Law with respect to any such rights as a result of its business operations except as
could not reasonably be expected to have a Material Adverse Effect.
               (h)         
Environmental Matters. 
  
 (i)        The properties owned, leased
or operated by the U.S. Borrower and its Subsidiaries now or in the past do not contain, and to their knowledge have not previously contained, any Hazardous Materials in amounts or concentrations which (A) constitute or constituted a violation of
applicable Environmental Laws or (B) could give rise to liability under applicable Environmental Laws except where such violation or liability could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect;

 (ii)       Except to the extent such matters could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect, the U.S. Borrower, each of its Subsidiaries and such properties and all operations conducted in connection therewith are in compliance, and have been in compliance, with all applicable Environmental
Laws, and there is
  
  
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 no contamination at, under or about such properties or
such operations which could interfere with the continued operation of such properties;
 (iii)      Neither
the U.S. Borrower nor any of its Subsidiaries has received any written notice of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters, Hazardous Materials, or compliance with Environmental
Laws, nor does the U.S. Borrower or any of its Subsidiaries have knowledge or reason to believe that any such notice will be received or is being threatened, except where such violation, alleged violation, non-compliance, liability or potential
liability which is the subject of such notice could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect;
 (iv)      Hazardous Materials have not been transported or disposed of to or from the properties owned, leased or operated
by the U.S. Borrower and its Subsidiaries in violation of, or in a manner or to a location which could give rise to liability under, Environmental Laws, nor have any Hazardous Materials been generated, treated, stored or disposed of at, on or under
any of such properties in violation of, or in a manner that could give rise to liability under, any applicable Environmental Laws, except where such violation or liability could not reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect;
 (v)       No judicial proceedings or governmental or administrative action is
pending, or, to the knowledge of the Borrower or the U.S. Borrower, threatened, under any Environmental Law to which the U.S. Borrower or any of its Subsidiaries is or will be named as a potentially responsible party with respect to such properties
or operations conducted in connection therewith, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any Environmental Law with
respect to the U.S. Borrower, any of its Subsidiaries or such properties or such operations that could reasonably be expected to have a Material Adverse Effect; and
 (vi)      There has been no release, or to the best of the Borrower's and the U.S. Borrower's knowledge, threat of
release, of Hazardous Materials at or from properties owned, leased or operated by the U.S. Borrower or any Subsidiary, now or in the past, in violation of or in amounts or in a manner that could give rise to liability under Environmental Laws that
could reasonably be expected to have a Material Adverse Effect.
                  (i)
         ERISA. 
  
 (i)        As of the Closing Date, neither the U.S. Borrower nor any of its Subsidiaries nor any ERISA Affiliate maintains or contributes to, or has any obligation under, any Employee Benefit Plans
other than those identified on Schedule 6.1(i-1) and neither the U.S. Borrower nor any of its Subsidiaries maintains or contributes to, or has any obligation under, any Canadian Employee Benefit Plans
other than those identified on Schedule 6.1(i-2).
 (ii)       The U.S. Borrower, each of its Subsidiaries and each of their ERISA Affiliates is in material compliance with all applicable provisions of ERISA and the regulations and published interpretations
thereunder with respect to all Employee Benefit Plans except for any required amendments for which the remedial amendment period as defined in Section 401(b)
  

 
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 of the Code has not yet expired and except where a failure to so comply could not reasonably be expected to have a Material Adverse Effect. The U.S. Borrower and each of
its Subsidiaries is in material compliance with all applicable provisions of the ITA and other Applicable Law and the regulations and published interpretations thereunder with respect to all Canadian Employee Benefit Plans except where a failure to
so comply could not reasonably be expected to have a Material Adverse Effect. Each Employee Benefit Plan that is intended to be qualified under Section 401(a) of the Code has been determined by the Internal Revenue Service to be so qualified, and
each trust related to such plan has been determined to be exempt under Section 501(a) of the Code except for such plans that have not yet received determination letters but for which the remedial amendment period for submitting a determination
letter has not yet expired. No liability has been incurred by the U.S. Borrower, any of its Subsidiaries or any of their ERISA Affiliates which remains unsatisfied for any taxes or penalties with respect to any Employee Benefit Plan or any
Multiemployer Plan except for a liability that could not reasonably be expected to have a Material Adverse Effect. No liability has been incurred by the U.S. Borrower or any of its Subsidiaries which remains unsatisfied for any taxes or penalties
with respect to any Canadian Employee Benefit Plan or any Canadian Multiemployer Plan, except for a liability that could not reasonably be expected to have a Material Adverse Effect.
 (iii)      Except as set forth on Schedule 6.1(i-1) or Schedule 6.1(i-2), as of the Closing Date, no Pension Plan or Canadian Pension Plan has been terminated, nor has any accumulated funding deficiency (as defined in Section 412 of the Code or any other Applicable Law)
been incurred (without regard to any waiver granted under Section 412 of the Code or any other Applicable Law), nor has any funding waiver from the Internal Revenue Service been received or requested with respect to any Pension Plan, nor has the
U.S. Borrower, any of Subsidiaries or any of their ERISA Affiliates failed to make any contributions or to pay any amounts due and owing as required by Section 412 of the Code, Section 302 of ERISA or the terms of any Pension Plan prior to the due
dates of such contributions under Section 412 of the Code or Section 302 of ERISA, nor has there been any event requiring any disclosure under Section 4041(c)(3)(C) or 4063(a) of ERISA with respect to any Pension Plan.
 (iv)      Except where the failure of any of the following representations to be correct in all material respects could
not reasonably be expected to have a Material Adverse Effect, neither the U.S. Borrower nor any of its Subsidiaries nor any of their ERISA Affiliates has: (A) engaged in a nonexempt prohibited transaction described in Section 406 of the ERISA or
Section 4975 of the Code, (B) incurred any liability to the PBGC which remains outstanding other than the payment of premiums and there are no premium payments which are due and unpaid, (C) failed to make a required contribution or payment to a
Multiemployer Plan or a Canadian Multiemployer Plan, (D) failed to make a required installment or other required payment under Section 412 of the Code, other Applicable Laws or its Employee Benefit Plans or (E) failed to make a required installment
or other required payment under Applicable Laws or its Canadian Employee Benefit Plans.
                                 (v)       No
Termination Event has occurred or is reasonably expected to occur. 
  
 (vi)      Except where the failure of any of the following representations to be correct in all material respects could
not reasonably be expected to have a Material Adverse Effect, no proceeding, claim (other than a benefits claim in the ordinary course of business),
  
  
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 lawsuit
and/or investigation is existing or, to the best knowledge of the Borrower and the U.S. Borrower after due inquiry, threatened concerning or involving any (A) employee welfare benefit plan (as defined in Section 3(1) of ERISA) currently maintained
or contributed to by the U.S. Borrower, any of its Subsidiaries or any of their ERISA Affiliates, (B) Pension Plan or Canadian Pension Plan or (C) Multiemployer Plan or Canadian Multiemployer Plan.
 (j)        Margin Stock. Neither the U.S. Borrower nor any of
its Subsidiaries is engaged principally or as one of its activities in the business of extending credit for the purpose of "purchasing" or "carrying" any "margin stock" (as each such term is defined or used, directly or indirectly, in Regulation U
of the Board of Governors of the Federal Reserve System). No part of the proceeds of any of the Loans or Letters of Credit will be used for purchasing or carrying margin stock or for any purpose which violates, or which would be inconsistent with,
the provisions of Regulation T, U or X of such Board of Governors. Not more than 25% of the value of the assets (either of the Borrower only or of the US Borrower and its Subsidiaries on consolidated basis) are margin stock.
 (k)       Government Regulation. Neither the U.S. Borrower nor any
of its Subsidiaries is an "investment company" or a company "controlled" by an "investment company" (as each such term is defined or used in the Investment Company Act of 1940, as amended) and neither the U.S. Borrower nor any of its Subsidiaries
is, or after giving effect to any Extension of Credit or U.S. Extension of Credit will be, subject to regulation under the Interstate Commerce Act, as amended, or any other Applicable Law which limits its ability to incur or consummate the
transactions contemplated hereby.
 (l)        Significant Indebtedness
. Schedule 6.1(l) sets forth a complete and accurate list of all Significant Indebtedness of the U.S. Borrower and its Subsidiaries in effect as of the Closing Date. As of the
Closing Date, other than as set forth in Schedule 6.1(l), each indenture, agreement or other instrument governing such Significant Indebtedness is, and after giving effect to the consummation of the
transactions contemplated by the Loan Documents will be, in full force and effect in accordance with the terms thereof. To the extent requested by the Administrative Agent, the U.S. Borrower and its Subsidiaries have delivered to the Administrative
Agent a true and complete copy of each indenture, agreement or other instrument governing the Significant Indebtedness required to be listed on Schedule 6.1(l). As of the Closing Date, neither the U.S.
Borrower nor any Subsidiary (nor, to the knowledge of the Borrower or the U.S. Borrower, any other party thereto) is in breach of or in default under any Significant Indebtedness in any material respect.
 (m)      Employee Relations. Each of the U.S. Borrower and its
Subsidiaries has a stable work force in place, except as could not reasonably be expected to have a Material Adverse Effect. The U.S. Borrower knows of no pending, threatened or contemplated strikes, work stoppage or other collective labor disputes
involving its employees or those of its Subsidiaries that could reasonably be expected to have a Material Adverse Effect.
 (n)       Burdensome Provisions. Except as described on Schedule 6.1(n), no Subsidiary is party to any agreement
or instrument or otherwise subject to any restriction or encumbrance that restricts or limits its ability to make dividend payments or other distributions in respect of its Capital Stock to the U.S. Borrower or any Subsidiary or to transfer any of
its assets or properties
  
  
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 to the U.S. Borrower or any other Subsidiary in each case other than restrictions or
encumbrances existing under or by reason of (i) the Loan Documents, (ii) Applicable Law and (iii) legally enforceable provisions which are contained in either (A) the organizational documents of any Subsidiary that a not Wholly-Owned Subsidiary or
(B) any other agreements with the other owner(s) of such Subsidiary (which, in the case of such provisions existing on the Closing Date, are described on Schedule 6.1(n)).
 (o)       Financial Statements. The audited and unaudited financial
statements delivered pursuant to Section 5.2(e)(i) are complete and correct and fairly present in all material respects on a Consolidated basis the assets, liabilities and financial position of the U.S. Borrower and its Subsidiaries and the Borrower
and its Subsidiaries, respectively, as at the respective dates of such statements, and the results of the operations and changes of financial position for the periods then ended (other than customary year-end adjustments for interim financial
statements). All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP (or, with respect to financial statements of the Borrower and its Subsidiaries, Canadian GAAP). Such financial
statements show all material indebtedness and other material liabilities, direct or contingent, of the U.S. Borrower and its Subsidiaries and the Borrower and its Subsidiaries, respectively, as of the date thereof, including material liabilities for
taxes, material commitments, and Indebtedness, in each case, to the extent required to be disclosed under GAAP (or, with respect to financial statements of the Borrower and its Subsidiaries, Canadian GAAP). The projected financial statements
delivered pursuant to Section 5.2(e)(ii) were prepared in good faith on the basis of the assumptions stated therein, which assumptions are believed to be reasonable in light of then existing conditions.
 (p)       No Material Adverse Change. Since December 31, 2005, there
has been no material adverse change in the business, assets, liabilities (actual or contingent), operations, or condition (financial or otherwise) of the U.S. Borrower and its Subsidiaries taken as a whole and no event has occurred or condition
arisen that could reasonably be expected to have a Material Adverse Effect.
 (q)       Solvency. As of the Closing Date and after giving effect to each Extension of Credit made hereunder and each U.S. Extension of Credit, each of the Credit Parties will be Solvent.
 (r)        Titles to Properties. Each of the U.S. Borrower and
its Subsidiaries has such title to the real property owned or leased by it as is reasonably necessary to the conduct of its business and valid and legal title to all of its personal property and assets, including, but not limited to, those reflected
on the balance sheets of the U.S. Borrower, the Borrower and their respective Subsidiaries delivered pursuant to Section 5.2(e)(i), Section 7.1(a), (b) and (d) except those which have been disposed of by the U.S. Borrower or its Subsidiaries
subsequent to such date which dispositions have been in the ordinary course of business or as otherwise expressly permitted hereunder.
 (s)       Liens. None of the properties and assets of the U.S. Borrower or any of its Subsidiaries is subject to any Lien, except Permitted Liens. Neither the
U.S. Borrower nor any of its Subsidiaries has signed any financing statement or any security agreement authorizing any secured party thereunder to file any financing statement, except to perfect those Permitted Liens.
  

  
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 (t)        Litigation. Except for matters existing on the
Closing Date and set forth on Schedule 6.1(t), there are no actions, suits or proceedings pending nor, to the knowledge of the Borrower and the U.S. Borrower, threatened against or in any other way
relating adversely to or affecting the U.S. Borrower or any of its Subsidiaries or any of their respective properties in any court or before any arbitrator of any kind or before or by any Governmental Authority that has or could reasonably be
expected to have a Material Adverse Effect.
 (u)       Senior Indebtedness
Status. The Obligations of each Credit Party under this Agreement and each of the other Loan Documents ranks and shall continue to rank at least senior in priority of payment to all Subordinated Indebtedness of each such
Person and is designated as "Senior Indebtedness" under all instruments and documents, now or in the future, relating to all Subordinated Indebtedness of such Person.
 (v)       OFAC. None of the U.S. Borrower, any Subsidiary of the
U.S. Borrower or any Affiliate of the U.S. Borrower or any U.S. Subsidiary Guarantor: (i) is a Sanctioned Person, (ii) has more than ten percent (10%) of its assets in Sanctioned Entities, or (iii) derives more than ten percent (10%) of its
operating income from investments in, or transactions with Sanctioned Persons or Sanctioned Entities. The proceeds of any Loan will not be used and have not been used to fund any operations in, finance any investments or activities in, or make any
payments to, a Sanctioned Person or a Sanctioned Entity. Solely, for purposes of this subsection (v), "Subsidiary" shall include (A) each Abitibi Entity and (B) each QSPE.
 (w)      Disclosure. The U.S. Borrower and/or its Subsidiaries have
disclosed to the Administrative Agent and the Lenders all agreements, instruments and corporate or other restrictions to which the U.S. Borrower or any of its Subsidiaries are subject, and all other matters known to it, that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect. The financial statements, material reports, material certificates or other material information furnished (whether in writing or orally), taken together as a whole, by
or on behalf of any of the U.S. Borrower or any of its Subsidiaries to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder (as modified or
supplemented by other information so furnished) do not contain any material misstatement of fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not
misleading; provided that, with respect to projected financial information, pro forma financial information, estimated financial
information and other projected or estimated information, such information was prepared in good faith based upon assumptions believed to be reasonable at the time.
 SECTION 6.2     Survival Of Representations And Warranties, Etc. All representations and warranties set forth in this
Article VI and all representations and warranties contained in any certificate, or any of the Loan Documents (including, but not limited to, any such representation or warranty made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations and warranties made under this Agreement shall be made or deemed to be made at and as of the Closing Date (except those that are expressly made as of a specific date),
shall survive the Closing Date and shall not be waived by the execution and delivery of this Agreement, any investigation made by or on behalf of the Lenders or any borrowing hereunder.
  

  
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 ARTICLE VII
  
 FINANCIAL INFORMATION AND NOTICES
 Until all the
Obligations have been paid and satisfied in full and the Commitment terminated, unless consent has been obtained in the manner set forth in Section 14.2, the U.S. Borrower and the Borrower will furnish or cause to be furnished to the Administrative
Agent (for distribution to the Lenders) at the Administrative Agent's Office at the address set forth in Section 14.1 or such other office as may be designated by the Administrative Agent from time to time:
                 SECTION 7.1      Financial Statements and Projections. 
  
 (a)       Quarterly Financial Statements of the U.S. Borrower. As
soon as practicable and in any event within forty-five (45) days (or, if earlier, on the date of any required public filing thereof) after the end of each of the first three (3) fiscal quarters of each Fiscal Year, an unaudited Consolidated balance
sheet of the U.S. Borrower and its Subsidiaries as of the close of such fiscal quarter and unaudited Consolidated statements of income, retained earnings and cash flows and a report containing management's discussion and analysis of such financial
statements for the fiscal quarter then ended and that portion of the Fiscal Year then ended, including the notes thereto, all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the corresponding
period in the preceding Fiscal Year and prepared by the U.S. Borrower in accordance with GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting
principles and practices during the period, and certified by the chief financial officer of the U.S. Borrower to present fairly in all material respects the financial condition of the U.S. Borrower and its Subsidiaries on a Consolidated basis as of
their respective dates and the results of operations of the U.S. Borrower and its Subsidiaries for the respective periods then ended, subject to normal year end adjustments.
 (b)       Annual Financial Statements of the U.S. Borrower. As soon
as practicable and in any event within ninety (90) days (or, if earlier, on the date of any required public filing thereof) after the end of each Fiscal Year, an audited Consolidated balance sheet of the U.S. Borrower and its Subsidiaries as of the
close of such Fiscal Year and audited Consolidated statements of income, retained earnings and cash flows and a report containing management's discussion and analysis of such financial statements for the Fiscal Year then ended, including the notes
thereto, all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the preceding Fiscal Year and prepared in accordance with GAAP and, if applicable, containing disclosure of the effect on the
financial position or results of operations of any change in the application of accounting principles and practices during the year. Such annual financial statements shall be audited by an independent certified public accounting firm acceptable to
the Administrative Agent and the U.S. Administrative Agent, and accompanied by a report thereon by such certified public accountants that is not qualified with respect to scope limitations imposed by the U.S. Borrower or any of its Subsidiaries or
with respect to accounting principles followed by the U.S. Borrower or any of its Subsidiaries not in accordance with GAAP.
  
  
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 (c)       Annual Business Plan and Financial Projections of the U.S.
Borrower. As soon as practicable and in any event within ninety (90) days after the beginning of each Fiscal Year, a business plan of the U.S. Borrower and its Subsidiaries for such Fiscal Year, such plan to be prepared in
accordance with GAAP and to include, on a quarterly basis, the following: a projected income statement, statement of cash flows and balance sheet and a statement containing the volume and price assumptions by product line used in preparing the
business plan, accompanied by a certificate from a Responsible Officer of the U.S. Borrower to the effect that, to the best of such officer's knowledge, such projections are good faith estimates (utilizing assumptions believed to be reasonable) of
the financial condition and operations of the U.S. Borrower and its Subsidiaries for such Fiscal Year.
 
	  
	 (d)
	 Financial
Statements of the Borrower and its Subsidiaries.

 (i)        Quarterly Financial Statements of the Borrower. As soon as practicable and in any event within the time prescribed by applicable Canadian
securities laws, regulations and policies, with respect to each fiscal quarter of each Fiscal Year, an unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of the close of such fiscal quarter and unaudited Consolidated
statements of income, retained earnings and cash flows and a report containing management's discussion and analysis of such financial statements for the fiscal quarter then ended and that portion of the Fiscal Year then ended, including the notes
thereto, all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the corresponding period in the preceding Fiscal Year and prepared by the Borrower in accordance with Canadian GAAP and, if
applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting principles and practices during the period, and certified by the chief financial officer of the
Borrower to present fairly in all material respects the financial condition of the Borrower and its Subsidiaries on a Consolidated basis as of their respective dates and the results of operations of the Borrower and its Subsidiaries for the
respective periods then ended, subject to normal year end adjustments.
 (ii)       Annual Financial Statements of the Borrower. As soon as practicable and in any event within the time prescribed by applicable Canadian securities
laws, regulations and policies, with respect to each Fiscal Year, an audited Consolidated balance sheet of the Borrower and its Subsidiaries as of the close of such Fiscal Year and audited Consolidated statements of income, retained earnings and
cash flows and a report containing management's discussion and analysis of such financial statements for the Fiscal Year then ended, including the notes thereto, all in reasonable detail setting forth in comparative form the corresponding figures as
of the end of and for the preceding Fiscal Year and prepared in accordance with Canadian GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting
principles and practices during the year. Such annual financial statements shall be audited by an independent certified public accounting firm acceptable to the Administrative Agent and the U.S. Administrative Agent, and accompanied by a report
thereon by such certified public accountants that is not qualified with respect to scope limitations imposed by the Borrower or any of its Subsidiaries or
  
  
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 with respect to accounting
principles followed by the Borrower or any of its Subsidiaries not in accordance with Canadian GAAP.
 (e)       Monthly Borrowing Limit Calculation. Within fifteen (15) Business Days after the last day of each calendar month beginning after the Third Amendment
Effective Date, a report in form and substance reasonably satisfactory to the Administrative Agent showing a calculation of the Asset Coverage Amount and clauses (a) and (b) of the Borrowing Limit as of the last day of the preceding calendar month.

                 
(f)      Balance Reporting.
 
	  
	  
	  

 (i)        Commencing with the month in which the Parent first
establishes a deposit, securities or investment account, within two (2) Business Days of the end of each calendar month, the Parent will deliver a written daily cash balance summary to the Administrative Agent and the U.S. Administrative Agent
showing the aggregate available balance of cash and Cash Equivalents in the deposit, securities and other investment accounts of the Parent as of the end of business on each Business Day of the preceding calendar month.
 (ii)       Within five (5) Business Days of the end of each calendar month, the U.S. Borrower
will deliver to the Administrative Agent and the U.S. Administrative Agent (A) commencing with the calendar month ending January 31, 2009, a written statement showing the aggregate daily available balance of cash and Cash Equivalents in all deposit,
securities and other investment accounts of the U.S. Borrower and its Subsidiaries for which such information is available as of the end of each Business Day of such calendar month and (B) commencing with the calendar month ending November 30, 2008,
a written statement showing the available balance of cash and Cash Equivalents in each deposit, securities and other investment account of the U.S. Borrower and its Subsidiaries as of the last Business Day of such calendar month for which such
information is available.
 (iii)      From time to time upon the request of the
Administrative Agent or the U.S. Administrative Agent, the U.S. Borrower will promptly deliver to the Administrative Agent and the U.S. Administrative Agent copies of any and all deposit account statements, securities account statements and other
investment account statements of the U.S. Borrower or any Subsidiary thereof that are requested to be delivered thereby, in each case, to the extent such statements are available.
 (g)       Monthly Borrowing Base Certificate. As soon as available,
but in any event no later than the earlier of (x) the date that is fifteen (15) Business Days after the end of each calendar month (as such date may be extended by the Borrower for up to an additional ten (10) days for the months ending October
31, 2008, November 30, 2008 and December 31, 2008) (each such monthly date, a "Borrowing Base Reporting Date") or (y) the date upon which the Original U.S. Borrower delivers the U.S. Borrowing Base
Certificate to the U.S. Administrative Agent for such calendar month, commencing with the calendar month ending November 30, 2008:
  
  
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 (i)        a completed Borrowing Base Certificate as at the end of such calendar month,
duly certified by a Responsible Officer of the Borrower (prior to the Conversion Date, such report shall include a calculation of the amount set forth in clause (c) of the Borrowing Limit as of the last day of the preceding calendar
month);
 (ii)       a detailed schedule and aging of the Accounts (A) including
all obligors, aged by due date (and, to the extent requested by the Administrative Agent, with an explanation of the terms offered) and commencing with the month ending March 31, 2009, aged by invoice date with respect to invoices generated by the
Abiserve system and (B) reconciled to the Borrowing Base Certificate delivered as of such date prepared in a manner reasonably acceptable to the Administrative Agent, together with (1) a summary specifying the name and balance due for each account
debtor and (2) a summary specifying such Accounts by the country in which each account debtor is located;
 (iii)      a schedule detailing the Borrower's and its Subsidiaries' Inventory, in form and substance reasonably satisfactory to the Administrative Agent, (A) by location (showing any Inventory located with a
third party under any consignment, bailee arrangement, or warehouse agreement), by class (raw material, mill store inventory, work-in-process and finished goods), and in the case of Inventory located with a third party, by volume on hand, which
Inventory shall be valued at Value of such Inventory and adjusted for Reserves as the Administrative Agent has previously indicated to the Borrower are deemed by the Administrative Agent to be appropriate and (B) reconciled to the Borrowing Base
Certificate delivered as of such date;
 (iv)      a report in form and substance
reasonably satisfactory to the Administrative Agent evidencing claims under the Credit Insurance Policy or such other information with respect to the Credit Insurance Policy as the Administrative Agent may reasonably request in its credit judgment;

 (v)       a reconciliation of the Accounts and Inventory between the amounts
shown in the Borrower's general ledgers and the reports delivered pursuant to clauses (ii) and (iii) above;
 (vi)      if readily available, a schedule and aging of the accounts payable of the Borrower and its
Subsidiaries in the form historically generated by the Borrower or such other information with respect to such accounts payable as the Administrative Agent may reasonably request in its credit judgment; and
 (vii)     concurrently with the delivery of the Borrowing Base Certificate, the U.S. Borrowing Base
Certificate;
 provided, that with respect to any calendar month end that is also a fiscal quarter end, the
Borrower shall have satisfied the foregoing clauses if it provides a draft of the applicable documentation required pursuant to such clauses on or prior to the applicable Borrowing Base Reporting Date and a final version of the applicable
documentation (in each case with a reconciliation to the applicable previously delivered draft documentation) by no later than the
  
  
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 earlier of (A) the date upon which financial statements are delivered for such fiscal quarter pursuant to Section 7.1(a) or
(B) the forty-fifth (45th) day after such fiscal quarter end.
 (h)       Cash Flow Reporting. (i) Commencing on December 15, 2008 and on the third (3rd) Business Day following the last day of each four week period thereafter (each such date a "Cash Flow Reporting Date
"), an updated rolling 13-week forecast (the "Forecast") of cash receipts and disbursements of the U.S. Borrower and its Consolidated Subsidiaries for the 13-consecutive week
period beginning on the date of delivery of such Forecast, which Forecast shall be in form and substance reasonably satisfactory to the Administrative Agent and the U.S. Administrative Agent and (ii) on each Cash Flow Reporting Date, a written
report in form and substance reasonably satisfactory to the Administrative Agent and the U.S. Administrative Agent setting forth the actual aggregated cash receipts and disbursements of the U.S. Borrower and its Consolidated Subsidiaries for the
immediately preceding four week period, together with a comparison of such actual figures to the Forecast for such period previously delivered to the Administrative Agent and the U.S. Administrative Agent pursuant to clause
(i) above.
 (i)        Notices of certain Asset
Dispositions, Insurance and Condemnation Events and Debt Issuances. In the event of any Asset Disposition (other than an Asset Disposition permitted pursuant to Section 10.5(a),
 (b), (c), (d), (e) or (f)), Insurance and Condemnation Event or any Debt Issuance by the U.S. Borrower or any of its Subsidiaries, (i) notice of such Asset Disposition, Insurance and Condemnation Event or Debt Issuance, which notice shall
specify the Net Cash Proceeds to be received by the U.S. Borrower or any of its Subsidiaries in connection with such Asset Disposition, Insurance and Condemnation Event or Debt Issuance and (ii) in the case of any Asset Disposition or Insurance and
Condemnation Event of Eligible Inventory or Eligible Accounts, a pro forma Borrowing Base Certificate giving effect to such Asset Disposition and Insurance and Condemnation
Event, in each case, to be delivered (A) at least five (5) Business Days prior to such Asset Disposition if the Net Cash Proceeds of such Asset Disposition exceed $1,000,000 or (B) within five (5) Business Days after a Responsible Officer has
knowledge of (1) such Asset Disposition if the Net Cash Proceeds of such Asset Disposition are $1,000,000 or less or (2) any Insurance and Condemnation Event.
                 (j)            Other Reporting. 
  
 (viii)    At such times as may be requested by the Administrative Agent, as of the quarter most recently ended, a list of all customer addresses, delivered electronically in a text formatted file acceptable to the
Administrative Agent;
 
	  
	 (ix)
	 Promptly upon
the Administrative Agent's request:

 (A)      an appraisal of
all of the Inventory of the Borrower and its Subsidiaries, which appraisal shall be in form and substance satisfactory to the Administrative Agent, prepared by an independent third party appraiser acceptable to the Administrative Agent, and upon
which the Administrative Agent and the Lenders (and the successors and assigns of the Administrative Agent and each Lender) is expressly permitted to rely; and
 (B)      a schedule, which schedule shall be in form and substance satisfactory to the Administrative
Agent, detailing the balance of all intercompany accounts of the Borrower and its Subsidiaries;
  
  
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 (x)       As soon as available but in any event within thirty (30) days after the end of each
calendar month, and at such other times as may be requested by the Administrative Agent, as of the period then ended, the Borrower's and its Subsidiaries' sales journals, cash receipts journals (identifying trade and non-trade cash receipts) and
debit memo/credit memo journals; and
 (xi)      As soon as possible and in any event
within thirty (30) days after filing thereof, copies of all tax returns filed by the Borrower or any of its Subsidiaries with the Canada Customs and Revenue Agency, and any other applicable Governmental Authority in any jurisdiction.
 SECTION 7.2      Officer's Compliance Certificate. At each time financial statements are delivered pursuant to Section
7.1(a) or (b) and at such other times as the Administrative Agent shall reasonably request, an Officer's Compliance Certificate.
 SECTION
7.3      Accountants' Certificate. At each time financial statements are delivered pursuant to Section 7.1(b), a certificate of the independent public accountants certifying such financial statements that in
connection with their audit, nothing came to their attention that caused them to believe that the U.S. Borrower or the Borrower failed to comply with the terms, covenants, provisions or conditions of Article IX or, if such is not the case,
specifying such non-compliance and its nature and period of existence.
                  SECTION 7.4      Other Reports.
  
                  (a)       Promptly upon their becoming available, copies of all registration statements (other than on Form
S-8) and regular periodic reports on Forms 10-K, 10-Q and 8-K that the Parent, the U.S. Borrower or any of its Subsidiaries shall have filed with the SEC, or any similar periodic reports filed with any comparable agency in Canada (it being agreed
that each such report or statement shall be deemed delivered on the date that (i) such report or statement is posted on the website of the SEC at www.sec.gov, on SEDAR at www.sedar.com or on the website of the Original U.S. Borrower at www.abitibibowater.com and (ii) the Original U.S. Borrower has provided the Administrative Agent with
written notice of such posting). 
  
 (b)       Promptly upon the mailing
thereof to the shareholders of the Parent or the U.S. Borrower generally, copies of all financial statements, reports and proxy statements so mailed (it being agreed that such mailing shall be deemed delivered on the date that (i) such information
is posted on the website of the SEC at www.sec.gov, on SEDAR at www.sedar.com or on the website of the Original U.S. Borrower at www.abitibibowater.com and (ii) the Original U.S. Borrower has provided the Administrative Agent with written notice of such posting).
 (c)       Such other information regarding the Collateral or the operations, business affairs and financial
condition of the U.S. Borrower or any of its Subsidiaries as the Administrative Agent (for itself or on behalf of any Lender) may reasonably request.
 SECTION 7.5     Notice Of Litigation And Other Matters. Prompt (but in no event later than ten (10) days after any Credit
Party obtains knowledge thereof) telephonic and written notice of:
  
  
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 (a)       the commencement of all proceedings and investigations by or before any Governmental Authority and all
actions and proceedings in any court or before any arbitrator against or involving the U.S. Borrower or any of its Subsidiaries or any of their respective properties, assets or businesses that if adversely determined could reasonably be expected to
have a Material Adverse Effect;
 (b)       any notice of any violation received by the U.S. Borrower
or any of its Subsidiaries from any Governmental Authority including, without limitation, any notice of violation of Environmental Laws which in any such case could reasonably be expected to have a Material Adverse Effect;
 (c)       any labor controversy that has resulted in, or threatens to result in, a strike or other work action
against the U.S. Borrower or any of its Subsidiaries which in any such case could reasonably be expected to have a Material Adverse Effect;
 (d)       any attachment, judgment, lien, levy or order exceeding $10,000,000 that is assessed against the U.S. Borrower or any of its Subsidiaries;
 (e)       (i) any Default or Event of Default or (ii) any event which constitutes or which with the passage of
time or giving of notice or both would constitute a default or event of default under any Significant Indebtedness to which the U.S. Borrower or any of its Subsidiaries is a party or by which the U.S. Borrower or any of its Subsidiaries or any of
their respective properties may be bound which could reasonably be expected to have a Material Adverse Effect;
 (f)        (i) any unfavorable determination letter from the Internal Revenue Service regarding the qualification of an Employee Benefit Plan under Section 401(a) of the Code (along with a copy
thereof), (ii) all notices received by the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates of the PBGC's or any other Governmental Authority's intent to terminate any Pension Plan or Canadian Pension Plan or to have a
trustee appointed to administer any Pension Plan or Canadian Pension Plan, (iii) all notices received by the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates from a Multiemployer Plan or Canadian Multiemployer Plan sponsor
concerning the imposition or amount of withdrawal liability pursuant to Section 4202 of ERISA or any other Applicable Law and (iv) the U.S. Borrower obtaining knowledge or reason to know that the U.S. Borrower or any of its Subsidiaries or any of
their ERISA Affiliates has filed or intends to file a notice of intent to terminate any Pension Plan or Canadian Pension Plan under a distress termination within the meaning of Section 4041(c) of ERISA or otherwise;
 (g)       any event which makes any of the representations set forth in Section 6.1 that is subject to materiality
or Material Adverse Effect qualifications inaccurate in any respect or any event which makes any of the representations set forth in Section 6.1 that is not subject to materiality or Material Adverse Effect qualifications inaccurate in any material
respect; and
 (h)       any notice delivered to the U.S. Borrower, or sent by or on behalf of the U.S.
Borrower, with respect to the U.S. Credit Agreement or any of the loan documents executed in connection therewith (including a copy of any such notice).
  
  
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 SECTION 7.6      Accuracy Of Information.  All written information, reports, statements and other papers and data
furnished by or on behalf of the Parent, the Borrower or the U.S. Borrower to the Administrative Agent or any Lender whether pursuant to this Article VII or any other provision of this Agreement, or any of the Security Documents, shall, at the time
the same is so furnished, comply with the representations and warranties set forth in Section 6.1(w).
 ARTICLE VIII
  
 AFFIRMATIVE COVENANTS
 Until all of the Obligations have been paid and satisfied in full and the Commitment terminated, unless consent has been obtained in the manner
provided for in Section 14.2, the U.S. Borrower and the Borrower will, and will cause each of their respective Subsidiaries to:
 SECTION
8.1     Preservation Of Corporate Existence And Related Matters.  Except as permitted by Section 10.4, preserve and maintain its legal existence and all material rights, franchises, licenses and privileges and
qualify and remain qualified as a foreign corporation and authorized to do business in each jurisdiction in which the failure to so qualify could reasonably be expected to have a Material Adverse Effect.
 SECTION 8.2   Maintenance Of Property; Commitment Reductions And Repayments.
 (a)       Maintenance of Property. Protect and preserve all
properties used or useful in its business, including copyrights, patents, trade names, service marks and trademarks; maintain in good working order and condition, ordinary wear and tear excepted, all buildings, equipment and other tangible real and
personal property; and from time to time make or cause to be made all repairs, renewals and replacements thereof and additions to such property necessary for the conduct of its business; in each case to the extent necessary so that the business
carried on in connection therewith may be conducted in a commercially reasonable manner, it being understood and agreed that nothing in this paragraph shall prohibit the idling or abandonment of any property in the reasonable business judgment of
the U.S. Borrower and its Subsidiaries.
 (b)       (i)        
Asset Dispositions. If the U.S. Borrower or any of its Subsidiaries receives Net Cash Proceeds from any Asset Disposition permitted under this Agreement (other than any Asset Disposition permitted
pursuant to Section 10.5(a), (b), (c), (d), (e) or (f)) or consented to by the Required Lenders pursuant to Section 14.2, or from any Insurance and Condemnation Event,
in all cases, in an aggregate amount for all such Asset Dispositions and Insurance and Condemnation Events in excess of $2,500,000:
 (A)      with respect to the Net Cash Proceeds received from any such Asset Disposition or Insurance and
Condemnation Event with respect to Canadian Fixed Assets:
 
	  
	 (1)
	 the U.S.
Borrower shall, or shall cause the following to occur:

 (x)
      first, permanently reduce the Overadvance Amount (and make any corresponding payment required pursuant to Section 2.5(c)) in
  
  
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 an aggregate amount not to exceed
the lesser of (I) the Asset Sale Reduction Amount and (II) the amount of the then applicable Overadvance Amount (it being understood and agreed that such reduction shall be applied to reduce the remaining scheduled reductions of the Overadvance
Amount, if any, on a pro rata basis); and
 (y)       then, to the extent of any remaining portion of the Asset Sale Reduction Amount:
 (I)        permanently reduce the U.S. Commitment (and make any corresponding payment required pursuant
to Section 2.5(c) of the U.S. Credit Agreement) by an amount equal to the product of (x) the U.S. Pro Rata Percentage multiplied by (y) any such remaining
Asset Sale Reduction Amount after giving effect to the repayments, if any, made in connection with the commitment reductions required pursuant to clause (b)(i)(A)(1)(x) above (it being understood and
agreed that such reduction shall also be applied to reduce the remaining scheduled reductions of the U.S. Overadvance Amount, if any, on a pro rata basis); and

 (II)      permanently reduce the Commitment (and make any corresponding payment required pursuant to
Section 2.5(c)) by an amount equal to the product of (x) the Canadian Pro Rata Percentage multiplied by (y) any such remaining Asset Sale Reduction Amount
after giving effect to the repayments, if any, made in connection with the commitment reductions required pursuant to clause (b)(i)(A)(1)(x) above; and
 (2)       the U.S. Borrower shall or shall cause the Net Cash Proceeds which remain after giving
effect to the repayments, if any, made in connection with the commitment reductions required pursuant to clause (b)(i)(A)(1) above to be applied to temporarily repay (without a corresponding commitment
reduction) (x) the U.S. Loans in the manner provided in Section 2.4(b)(i) of the U.S. Credit Agreement in an amount equal to the product of (I) the U.S. Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds and (y) the Loans in the manner provided in Section 2.4(b)(i) in an amount equal to the product
of (I) the Canadian Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds;
 (B)      with respect to the Net Cash Proceeds received from any such Asset Disposition or Insurance and
Condemnation Event with respect to U.S. Non-Fixed Assets Collateral:
 (1)       the U.S.
Borrower shall or shall cause any repayment as required pursuant to Section 2.4(b) of the U.S. Credit Agreement after giving effect to such Asset Disposition or Insurance and Condemnation Event to be
made; and
  
  
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 (2)       the U.S. Borrower shall or shall cause the Net Cash Proceeds which remain after giving effect to the repayments, if any, made pursuant to clause (b)(i)(B)(1) above to be applied to temporarily repay (without a corresponding commitment reduction) the U.S. Loans in the manner provided in Section 2.4(b)(i) of the U.S. Credit Agreement; and
 (3)       the U.S. Borrower shall or shall cause the Net Cash Proceeds which remain after giving
effect to the repayments, if any, made pursuant to clause (b)(i)(B)(1) and clause (b)(i)(B)(2) above to be applied to temporarily repay (without a
corresponding commitment reduction) the Loans in the manner provided in Section 2.4(b)(i);
 (C)     with respect to the Net Cash Proceeds received from any such Asset Disposition or Insurance and
Condemnation Event with respect to Non-Fixed Assets Collateral (other than the Korean Shares):
 (1)
      the U.S. Borrower shall or shall cause any repayments as required pursuant to Section 2.4(b) after giving effect to such Asset Disposition or Insurance and
Condemnation Event to be made; and
 (2)       the U.S. Borrower shall or shall cause
the Net Cash Proceeds which remain after giving effect to the repayments, if any, made pursuant to clause (b)(i)(C)(1) above to be applied to temporarily repay (without a corresponding commitment
reduction) the Loans in the manner provided in Section 2.4(b)(i); and
 (3)       the U.S. Borrower shall or shall cause the Net Cash Proceeds which remain after giving effect to the repayments, if any, made pursuant to clause (b)(i)(C)(1) and clause (b)(i)(C)(2) above to be applied to temporarily repay (without a corresponding commitment reduction) the U.S. Loans in the manner provided in Section 2.4(b)(i)
 of the U.S. Credit Agreement;
 (D)      with respect to the
Net Cash Proceeds received from any such Asset Disposition or Insurance and Condemnation Event with respect to Korean Fixed Assets or the Korean Shares:
 
	  
	 (1)
	 the U.S.
Borrower shall, or shall cause the following to occur:

 (x)
      first, permanently reduce the Overadvance Amount (and make any corresponding payment required pursuant to Section 2.5(c)) in an aggregate amount not to exceed the lesser of (I) the Asset Sale Reduction Amount and (II) the amount of the then applicable Overadvance Amount (it being understood and agreed that such reduction shall be applied to reduce the
remaining scheduled reductions of the Overadvance Amount, if any, on a pro rata basis);
 (y)       then, to the extent of any remaining
portion of the Asset Sale Reduction Amount after giving effect to the repayments, if any, made
  
  
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 in connection with the commitment reductions required pursuant to clause (b)(i)(D)(1)(x) above,
permanently reduce the U.S. Overadvance Amount (and make any corresponding payment required pursuant to Section 2.5(c) of the U.S. Credit Agreement) in an aggregate amount not to exceed the lesser of
(I) such remaining Asset Sale Reduction Amount and (II) the amount of the then applicable U.S. Overadvance Amount (it being understood and agreed that such reduction shall be applied to reduce the remaining scheduled reductions of the U.S.
Overadvance Amount, if any, on a pro rata basis); and
 (z)       then, to the extent of any remaining
portion of the Asset Sale Reduction Amount:
 (I)        permanently reduce the U.S. Commitment (and
make any corresponding payment required pursuant to Section 2.5(c) of the U.S. Credit Agreement) by an amount equal to the product of (x) the U.S. Pro Rata Percentage multiplied
by (y) any such remaining Asset Sale Reduction Amount after giving effect to the repayments, if any, made in connection with the commitment reductions required pursuant to clauses
(b)(i)(D)(1)(x) and (b)(i)(D)(1)(y) above; and
 (II)      permanently reduce the Commitment (and make any corresponding payment required pursuant to Section 2.5(c)) by an amount equal to the product of (x)
the Canadian Pro Rata Percentage multiplied by (y) any such remaining Asset Sale Reduction Amount after giving effect to the repayments, if any, made in connection with the commitment reductions
required pursuant to clauses (b)(i)(D)(1)(x) and (b)(i)(D)(1)(y) above; and
 (2)       the U.S. Borrower shall or shall cause the Net Cash Proceeds which remain after giving
effect to the repayments, if any, made in connection with the commitment reductions required pursuant to clause (b)(i)(D)(1) above to be applied to temporarily repay (without a corresponding commitment
reduction) (x) the U.S. Loans in the manner provided in Section 2.4(b)(i) of the U.S. Credit Agreement in an amount equal to the product of (I) the U.S. Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds and (y) the Loans in the manner provided in Section 2.4(b)(i) in an amount equal to the product
of (I) the Canadian Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds; and
 (E)       with respect to the Net Cash Proceeds from any such Asset Disposition or Insurance
and Condemnation Event of assets or property not covered by clauses (b)(i)(A), (b)(i)(B), (b)(i)(C) or (b)(i)(D) above (including, without limitation, any timberlands and any Fixed Assets that are not Canadian Fixed Assets):
 
	  
	 (1)
	 the U.S.
Borrower shall, or shall cause the following to occur:

  
  
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 (x)       permanently reduce the U.S. Commitment (and make any corresponding payment required pursuant to Section 2.5(c) of the U.S. Credit Agreement) by an amount equal to the product of (I) the U.S. Pro Rata Percentage multiplied by (II) the Asset Sale Reduction Amount (it
being understood and agreed that such reduction shall also be applied to reduce the remaining scheduled reductions of the U.S. Overadvance Amount, if any, on a pro rata
basis);
 and
 (y)       permanently reduce the Commitment (and make any corresponding payment required pursuant to Section 2.5(c)) by an amount equal to the product of
(I) the Canadian Pro Rata Percentage multiplied by (II) the Asset Sale Reduction Amount (it being understood and agreed that such reduction shall also be applied to reduce the remaining
scheduled reductions of the Overadvance Amount, if any, on a pro rata basis); and
 (2)      the U.S. Borrower shall or shall cause the Net Cash Proceeds which remain after giving
effect to the repayments, if any, made in connection with the commitment reductions required pursuant to clause (b)(i)(E)(1) above to be applied to temporarily repay (without a corresponding commitment
reduction) (x) the U.S. Loans in the manner provided in Section 2.4(b)(i) of the U.S. Credit Agreement in an amount equal to the product of (I) the U.S. Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds and (y) the Loans in the manner provided in Section 2.4(b)(i) in an amount equal to the product
of (I) the Canadian Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds.
 Each such permanent reduction and each such repayment shall be made within three (3) Business Days after the receipt of Net Cash Proceeds of any such Asset Disposition or Insurance and Condemnation Event.
  
 (ii)       Debt Issuances. If the U.S. Borrower or any of its Subsidiaries receives Net Cash Proceeds from any Debt Issuance, the U.S. Borrower shall immediately notify the Administrative Agent and upon receipt of such notice,
the Administrative Agent shall promptly notify the Lenders. Upon receipt of such Net Cash Proceeds,
 (A)      the Commitment and the U.S. Commitment shall be reduced by an amount equal to seventy-five percent (75%) of such Net Cash Proceeds (such amount, the "Debt Issuance Reduction
Amount") with each such reduction to be effected as follows:
 (1)       to permanently reduce the U.S. Commitment (and make any corresponding payment required pursuant to Section 2.5(c) of the U.S. Credit Agreement) by an
amount equal to the product of (x) the U.S. Pro Rata Percentage multiplied by (y) the Debt Issuance Reduction Amount (it being
  
  
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 understood and agreed that such
reduction shall also be applied to reduce the remaining scheduled reductions of the U.S. Overadvance Amount, if any, on a pro rata basis); and
 (2)       to permanently reduce the Commitment (and make any corresponding payment required
pursuant to Section 2.5(c)) by an amount equal to the product of (x) the Canadian Pro Rata Percentage multiplied by (y) the Debt Issuance Reduction
Amount (it being understood and agreed that such reduction shall also be applied to reduce the remaining scheduled reductions of the  Overadvance Amount, if any, on a pro rata
 basis); and
 (B)      the U.S. Borrower shall or shall cause
the Net Cash Proceeds which remain after giving effect to the repayments, if any, made in connection with the commitment reductions required pursuant to clause (b)(ii)(A) above to be applied to
temporarily repay (without a corresponding commitment reduction) (x) the U.S. Loans in the manner provided in Section 2.4(b)(i) of the U.S. Credit Agreement in an amount equal to the product of (I) the
U.S. Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds and (y) the Loans in the manner provided in Section 2.4(b)(i) in an amount equal to the product of (I) the Canadian Pro Rata Percentage multiplied by (II) the aggregate amount of such remaining Net Cash Proceeds.
 Each such permanent reduction and each such repayment shall be made within three (3) Business Days after the receipt of Net Cash Proceeds of any such Debt
Issuance.
 (iv)      Notwithstanding the foregoing, no later than five (5) Business Days following the date of
receipt by the U.S. Borrower or any of its Subsidiaries of any Net Cash Proceeds from any Insurance and Condemnation Event, the U.S. Borrower shall apply such Net Cash Proceeds in accordance with the applicable subclause of clause (i) above; provided, that no such application shall be required from the Net Cash Proceeds received by the U.S. Borrower or any of its Subsidiaries with respect to
such Insurance and Condemnation Event to the extent such Net Cash Proceeds therefrom are either (A) used, within twelve (12) months after receipt of such Net Cash Proceeds, to reimburse the U.S. Borrower or any of its Subsidiaries for amounts spent
by them to replace, repair and/or restore the assets that were the subject of such Insurance and Condemnation Event or (B) committed, within three (3) months after receipt of such Net Cash Proceeds, to be used to replace, repair and/or restore the
assets that were the subject of such Insurance and Condemnation Event, and are thereafter actually used to replace, repair and/or restore such assets within twelve (12) months after receipt of such Net Cash Proceeds; provided
, that any portion of the Net Cash Proceeds not so committed to be reinvested within such three (3) month period or actually used within such twelve (12) month period shall be applied in accordance with the applicable
subclause of clause (i) above; provided, further, that until reinvested, the aggregate amount of the Net Cash Proceeds to be reinvested shall be used to
temporarily repay Loans and U.S. Loans in accordance with the applicable subclause of clause (i) above.
 SECTION 8.3   INSURANCE. MAINTAIN INSURANCE WITH FINANCIALLY SOUND AND REPUTABLE INSURANCE COMPANIES
AGAINST SUCH RISKS AND IN SUCH AMOUNTS AS ARE CUSTOMARILY MAINTAINED
  
  
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 BY SIMILAR BUSINESSES AND AS MAY BE REQUIRED BY APPLICABLE LAW AND AS ARE REQUIRED BY ANY SECURITY
DOCUMENTS (INCLUDING, WITHOUT LIMITATION, HAZARD AND BUSINESS INTERRUPTION INSURANCE), AND ON THE CLOSING DATE AND FROM TIME TO TIME THEREAFTER DELIVER TO THE ADMINISTRATIVE AGENT UPON ITS REASONABLE REQUEST INFORMATION IN REASONABLE DETAIL AS TO
THE INSURANCE THEN IN EFFECT, STATING THE NAMES OF THE INSURANCE COMPANIES, THE AMOUNTS OF THE INSURANCE, THE DATES OF THE EXPIRATION THEREOF AND THE PROPERTIES AND RISKS COVERED THEREBY.
 SECTION 8.4    Accounting Methods And Financial Records. Maintain a system of accounting, and keep proper books, records and
accounts (which shall be true and complete in all material respects) as may be required or as may be necessary to permit the preparation of financial statements in accordance with GAAP and in compliance with the regulations of any Governmental
Authority having jurisdiction over it or any of its properties.
 SECTION 8.5    Payment Of Taxes. Pay and discharge
all taxes, assessments and other governmental charges that may be levied or assessed upon it or on its income or profits or any of its property; except for any such tax, assessment or other governmental charge the payment of which is being contested
in good faith so long as adequate reserves are maintained with respect thereto in accordance with GAAP.
 SECTION 8.6   
Compliance With Laws And Approvals. Observe and remain in compliance with all Applicable Laws and maintain in full force and effect all Governmental Approvals, in each case applicable to the conduct of its business, except where the failure
to do so could not reasonably be expected to have a Material Adverse Effect.
 SECTION 8.7    Environmental
Laws.  In addition to and without limiting the generality of Section 8.6, (a) comply with, and ensure such compliance by all tenants and subtenants with all applicable Environmental Laws and obtain and comply with and maintain, and
ensure that all tenants and subtenants, if any, obtain and comply with and maintain, any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws, except where the failure to do so could not
reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, (b) conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other actions required under Environmental Laws,
and promptly comply with all lawful orders and directives of any Governmental Authority regarding Environmental Laws, except where the failure to conduct or complete such actions, or comply with such orders or directions, could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse Effect and (c) defend, indemnify and hold harmless the Administrative Agent and the Lenders, and their respective parents, Subsidiaries, Affiliates, employees, agents, officers
and directors, from and against any claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or in any way relating to the presence
of Hazardous Materials, or the violation of, noncompliance with or liability under any Environmental Laws applicable to the operations of the U.S. Borrower or any of its Subsidiaries, or any orders, requirements or demands of Governmental
Authorities related
  
  
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 thereto, including, without
limitation, reasonable attorney's and consultant's fees, investigation and laboratory fees, response costs, court costs and litigation expenses, except to the extent that any of the foregoing directly result from the gross negligence or willful
misconduct of the party seeking indemnification therefor, as determined by a court of competent jurisdiction by final nonappealable judgment.
 SECTION 8.8    Compliance With Erisa. In addition to and without limiting the generality of Section 8.6, (a) except where the failure to so comply could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect, (i) comply with all material applicable provisions of ERISA with respect to Employee Benefit Plans and the ITA and other Applicable Law with respect to all Canadian Employee Benefit Plans, (ii) not take any action or
fail to take action the result of which could be a liability to the PBGC or any other Governmental Authority or to a Multiemployer Plan or a Canadian Multiemployer Plan, (iii) not participate in any prohibited transaction that could result in any
civil penalty under ERISA or tax under the Code and (iv) operate each Employee Benefit Plan in such a manner that will not incur any tax liability under Section 4980B of the Code or any liability to any qualified beneficiary as defined in Section
4980B of the Code and (b) furnish to the Administrative Agent upon the Administrative Agent's request such additional information about any Employee Benefit Plan or Canadian Employee Benefit Plan as may be reasonably requested by the Administrative
Agent.
                 SECTION
8.9    Visits and Inspections; Consultant Matters.
  
                
(a)       Visits and Inspections. Permit representatives of the Administrative Agent or any Lender (including representatives of the U.S. Administrative Agent), from
time to time upon prior reasonable notice and during normal business hours, at the Borrower's expense, to visit and inspect its properties; inspect, audit and make extracts from its books, records and files, including, but not limited to, management
letters prepared by independent accountants; discuss with its principal officers, and its independent accountants, its business, assets, liabilities, financial condition, results of operations and business prospects; and conduct field audits,
examinations and appraisals with respect to the Collateral (including, but not limited to, the Accounts, the Inventory and the Canadian Fixed Assets), which field audits shall occur no less frequently than once per fiscal quarter and which inventory
appraisals shall occur no less frequently than once per each six-month period. Notwithstanding the foregoing, upon the occurrence and during the continuance of an Event of Default, the Administrative Agent may do any of the foregoing at any time
without advance notice and the Borrower shall be required to bear the cost of all such visits, inspections, field audits, examinations and appraisals. Notwithstanding the foregoing, field audits, examinations and appraisals with respect to the
Collateral shall be conducted only by the Administrative Agent, in its sole discretion or at the request of any Lender. 
  
 (b)       Consultant Matters. (i) Permit the retention of
Consultants and (ii) cooperate with any such Consultants and allow any such Consultants, from time to time upon prior reasonable notice and during normal business hours, at the Borrower's expense, to visit and inspect any of the properties of the
Borrower and its Subsidiaries, examine corporate, financial and operating records of the Borrower and its Subsidiaries, make copies thereof or abstracts therefrom and discuss the affairs, finances and accounts of the Borrower and its Subsidiaries
with their respective directors, officers, and independent public accountants.
  
  
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SECTION 8.10    Additional Guarantors; Canadian Fixed Assets And Korean Shares.
  

 (a)       Within thirty (30) days after (i) the redesignation of an Immaterial Subsidiary as a Material Subsidiary
in accordance with Section 8.10(b) below or (ii) the creation or acquisition of any Material Subsidiary, including in connection with any Permitted Acquisition (any such Subsidiary, a "New Material Subsidiary"), cause to be executed and delivered to the Administrative Agent (unless otherwise agreed to by the Administrative Agent): (A) a duly executed Subsidiary Guaranty Agreement (or, if applicable, a joinder agreement in form and substance
reasonably satisfactory to the Administrative Agent joining such New Material Subsidiary to the Subsidiary Guaranty Agreement), the Collateral Agreement and any other applicable Security Documents, (B) such updated Schedules to the Loan Documents as
requested by the Administrative Agent with regard to such Person (including, without limitation, updated Schedule 6.1(b) reflecting the creation or acquisition of such New Material Subsidiary), (C) such
documents and certificates referred to in Section 5.2 as may be reasonably requested by the Administrative Agent (including, without limitation, favorable legal opinions of counsel addressed to the Administrative Agent and the Lenders with respect
to the New Material Subsidiary, the Loan Documents and such other matters as the Lenders shall request), and (D) such other documents and certificates as may be reasonably requested by the Administrative Agent, all in form, content and scope
reasonably satisfactory to the Administrative Agent.
 (b)       The Borrower may, at any time and upon
written notice to the Administrative Agent, redesignate any Immaterial Subsidiary as a Material Subsidiary. Further, promptly after the date on which the Borrower or the Administrative Agent determines that any Subsidiary no longer qualifies as an
Immaterial Subsidiary such Subsidiary shall be redesignated as a Material Subsidiary and shall comply with clause (a) of this Section.
 (c)       The Borrower may, at any time and upon written notice to the Administrative Agent, designate any direct or indirect parent company of the Borrower that is organized under the laws of Canada or any
province thereof as a Parent Guarantor by causing such direct or indirect parent company of the Borrower to execute and deliver all documents and certificates required to be delivered pursuant to clause (a) of this Section (provided that such direct or indirect parent company of the Borrower shall, rather than execute a Subsidiary Guaranty Agreement or a joinder thereto, either (i) execute a parent guaranty agreement in form and substance
satisfactory to the Administrative Agent or (ii) join as a guarantor under Article XI).
 (d)       Within thirty (30) days after the creation or acquisition of any new Subsidiary, including in connection with any Permitted Acquisition, cause to be executed and delivered to the Administrative
Agent (unless otherwise agreed to by the Administrative Agent) a duly executed joinder agreement in the form attached to the Intercompany Subordination Agreement joining such new Subsidiary thereto.
 (e)       (i)        (A)       Concurrently with the delivery of the documentation required to be delivered pursuant to
Section 8.10(e)(ii)(A) of the U.S. Credit Agreement but in no event later than April 15, 2008, the U.S. Administrative Agent shall have received:
  

  
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 (1)       evidence satisfactory to the U.S. Administrative Agent that the U.S. Borrower shall
be diligently pursuing in good faith the rendering of the solvency opinions referred to in Section 8.10(e)(i)(B) and Section 8.10(e)(i)(C) by a third party
consultant reasonably acceptable to the U.S. Administrative Agent (including having delivered to such third party consultant all financial and other information necessary to provide the basis for the delivery of such solvency opinion);
and
 (2)       information, in form and substance reasonably satisfactory to the
U.S. Administrative Agent, confirming (x) that the New U.S. Borrowers own, free and clear of any Liens, the New U.S. Borrower Fixed Assets and (y) the ability of the New U.S. Borrowers to grant to the U.S. Administrative Agent, on behalf of the
Secured Parties and the U.S. Secured Parties, a perfected first priority security interest in the New U.S. Borrower Fixed Assets without the consent or approval of any third Person; and
 (B)      Concurrently with the delivery of the documentation required to be delivered pursuant
to Section 8.10(e)(ii)(B) of the U.S. Credit Agreement but in no event later than May 15, 2008, the Administrative Agent shall have received:
 (1)       a copy of a solvency opinion from an opinion provider reasonably acceptable to the
Administrative Agent as to the solvency of the Original U.S. Borrower after giving effect to the New U.S. Borrower Transactions and the transactions contemplated by the Fourth Amendment, this Agreement and the joinder agreement referred to in clause
(2) below and such other matters as the Lenders shall request (which such opinion shall expressly permit reliance (or be accompanied by a letter, in form and substance satisfactory to the Administrative Agent, executed by the opinion provider that
expressly permits reliance) by the Administrative Agent, the Lenders and any successors and assigns of the Administrative Agent or any Lender);
 (2)       a duly executed joinder agreement, in form and substance reasonably satisfactory to
the Administrative Agent, joining each New U.S. Borrower to Article XI of this Agreement (as a U.S. Borrower), the Intercompany Subordination Agreement and any other applicable Loan Documents;
 (3)       such updated Schedules to the Loan Documents as requested by the Administrative Agent
or the U.S. Administrative Agent with regard to the New U.S. Borrowers (including, without limitation, an updated Schedule  6.1(b));
 (4)       a certificate of a Responsible Officer of each New U.S. Borrower certifying as to the
incumbency and genuineness of the signature of each officer of each New U.S. Borrower executing the Loan Documents
  
  
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 to which it is a party and certifying that attached thereto is a true, correct and complete copy of (w) the articles or certificate of incorporation
or formation of each New U.S. Borrower and all amendments thereto, certified as of a recent date by the appropriate Governmental Authority in its jurisdiction of incorporation or formation, (x) the bylaws or other governing document of each New U.S.
Borrower as in effect on the date hereof, (y) resolutions duly adopted by the board of directors or other governing body of each New U.S. Borrower authorizing the transactions contemplated hereunder and the execution, delivery and performance of
this Agreement and the other Loan Documents to which it is a party, and (z) certificates as of a recent date of the good standing of each New U.S. Borrower under the laws of its jurisdiction of incorporation or formation;
 (5)       the results of a Lien search (including a search as to judgments, pending litigation
and tax matters) made against each New U.S. Borrower under the Uniform Commercial Code (or applicable judicial docket) as in effect in each jurisdiction in which filings or recordations under the Uniform Commercial Code should be made to evidence or
perfect security interests in all assets of each New U.S. Borrower, indicating among other things that the assets of each New U.S. Borrower are free and clear of any Liens (except Permitted Liens);
 (6)       evidence in form and substance reasonably satisfactory to the Administrative Agent
confirming the interest of the U.S. Administrative Agent (as loss payee and additional insured and, with respect to the real property subject to the New U.S. Borrower Mortgages (other than the Supplemental New U.S. Borrower Mortgage), as mortgagee)
with respect to such insurance coverage;
 (7)       a duly executed counterpart of
each New U.S. Borrower Mortgage (other than the Supplemental New U.S. Borrower Mortgage);
 (8)       all filings and recordations that are necessary to perfect the security interests of the U.S. Administrative Agent, on behalf of itself, the Secured Parties and the U.S. Secured Parties, in the
Collateral granted by each New U.S. Borrower under each New U.S. Borrower Mortgage (other than the Supplemental New U.S. Borrower Mortgage) and evidence satisfactory to the Administrative Agent that upon such filings and recordations such security
interests constitute valid and perfected first priority Liens therein;
 (9)       favorable opinions of counsel of each New U.S. Borrower addressed to the Administrative Agent and the Lenders with respect to each New U.S. Borrower, this Agreement, each of the New U.S. Borrower
Mortgages (other than the Supplemental New U.S. Borrower Mortgage) and the other Loan Documents to which the New U.S. Borrowers are a party and such other matters as the Lenders shall reasonably request
  
  
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 (which such
opinions shall expressly permit reliance by successors and assigns of the Administrative Agent or any Lender); and
 (10)     such other instruments, documents and certificates as the Administrative Agent shall reasonably request.
 (C)      Concurrently with the delivery of the documentation required to be delivered pursuant
to Section 8.10(e)(ii)(C) of the U.S. Credit Agreement but in no event later than May 22, 2008, the Administrative Agent shall have received a copy of a solvency opinion from an opinion provider
reasonably acceptable to the Administrative Agent as to the solvency of each of the New U.S. Borrowers (other than BNS Holdings if BNS Holdings is a holding company that holds only the Capital Stock of the Coosa Pines U.S. Borrower and the Grenada
U.S. Borrower and has no creditors other than the U.S. Lenders), in each case after giving effect to the New U.S. Borrower Transactions and the transactions contemplated by the Fourth Amendment, this Agreement and the joinder agreement referred to
in Section 8.10(e)(i)(B)(2) above and such other matters as the Lenders shall request (which such opinion shall expressly permit reliance (or be accompanied by a letter, in form and substance
satisfactory to the Administrative Agent, executed by the opinion provider that expressly permits reliance) by the Administrative Agent, the Lenders and any successors and assigns of the Administrative Agent or any Lender).
 (D)      Concurrently with the delivery of the documentation required to be delivered pursuant
to Section 8.10(e)(ii)(D) of the U.S. Credit Agreement but in no event later than May 30, 2008, the Administrative Agent shall have received:
 (1)       to the extent reasonably requested by the Administrative Agent, evidence in form and
substance reasonably satisfactory to the Administrative Agent confirming the interest of the U.S. Administrative Agent as loss payee, additional insured and mortgagee with respect to the Coosa Pines Mill and Coosa Pines Real Property subject to the
Supplemental New U.S. Borrower Mortgage;
 (2)       a duly executed counterpart of
the Supplemental New U.S. Borrower Mortgage;
 (3)       all filings and
recordations that are necessary to perfect the security interests of the U.S. Administrative Agent, on behalf of itself, the other Secured Parties and the U.S. Secured Parties, in the Collateral granted by the Supplemental New U.S. Borrower
Mortgagor, and evidence satisfactory to the Administrative Agent that upon such filings and recordations such security interests constitute valid and perfected first priority Liens therein (or, to the extent acceptable to the Administrative Agent,
evidence satisfactory to the Administrative Agent that upon delivery of the Supplemental New U.S. Borrower Mortgage, all right, title and interest of the Supplemental New U.S. Borrower Mortgagor shall be subordinated in all respects to the security
interests of the U.S.
  
  
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 Administrative
Agent, on behalf of itself, the other Secured Parties and the U.S. Secured Parties, with respect to the interests subject to the Supplemental New U.S. Borrower Mortgage);
 (4)       favorable opinions of counsel of the Supplemental New U.S. Borrower Mortgagor
addressed to the Administrative Agent and the Lenders with respect to the Supplemental New U.S. Borrower Mortgage and such other matters as the Lenders shall reasonably request (which such opinions shall expressly permit reliance by successors and
assigns of the Administrative Agent or any Lender); and
 (5)       such other
instruments, documents and certificates as the Administrative Agent shall reasonably request;
 (E)       As of the Seventh Amendment Effective Date, the Borrower has delivered the documentation required pursuant to Section 8.10(e)(i) of this Agreement.

 (ii)       As soon as possible but in any event no later than July 31, 2008 (as
such date may be extended by the Administrative Agent and the U.S. Administrative Agent in their sole discretion):
 (A)      a final title policy, insuring the first priority Liens of the Secured Parties and the U.S. Secured Parties and showing no Liens prior to the Liens of the Secured Parties and the U.S. Secured Parties
(other than for ad valorem taxes not yet due and payable) and containing only such other customary title exceptions as are reasonably acceptable to the U.S. Administrative Agent, with title insurance companies acceptable to the U.S. Administrative
Agent, on each of the Coosa Pines Mill Real Property and Grenada Mill Real Property (it being agreed that the U.S. Borrower and its Subsidiaries shall provide or obtain any customary affidavits and indemnities as may be required or necessary to
obtain title insurance satisfactory to the U.S. Administrative Agent);
 (B)      copies
of all recorded documents creating exceptions to the title policies referred to in Section 8.10(e)(ii)(A);  
 (C)      a certification form of a certification from the National Research Center, or any successor
agency thereto, regarding each of the Coosa Pines Mill Real Property and the Grenada Mill Real Property;
 (D)      copies of as-built surveys of a recent date of each of the Coosa Pines Mill Real Property and the Grenada Mill Real Property, in each case, certified as of a recent date by a registered engineer or land
surveyor. Each such survey shall be accompanied by an affidavit (a "Survey Affidavit") of an authorized signatory of the owner of such property stating that there have been no improvements or
encroachments to the property since the date of the respective survey such that the existing survey is no longer accurate. Each such survey shall show the area of such property, all boundaries of the land with courses and
  
  
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 distances
indicated, including chord bearings and arc and chord distances for all curves, and shall show dimensions and locations of all easements, private drives, roadways, and other facts materially affecting such property, and shall show such other details
as the U.S. Administrative Agent may reasonably request, including, without limitation, any encroachment (and the extent thereof in feet and inches) onto the property or by any of the improvements on the property upon adjoining land or upon any
easement burdening the property; any improvements, to the extent constructed, and the relation of the improvements by distances to the boundaries of the property, to any easements burdening the property, and to the established building lines and the
street lines; and if improvements are existing, (x) a statement of the number of each type of parking space required by Applicable Laws, ordinances, orders, rules, regulations, restrictive covenants and easements affecting the improvement, and the
number of each such type of parking space provided, and (y) the locations of all utilities serving the improvement;
 (E)       a Phase I environmental assessment and such other environmental report reasonably requested by the U.S. Administrative Agent regarding each of the Coosa Pines Mill Real Property and the Grenada
Mill Real Property, in each case prepared by an environmental engineering firm acceptable to the U.S. Administrative Agent showing no environmental conditions in violation of Environmental Laws or liabilities under Environmental Laws, either of
which could reasonably be expected to have a Material Adverse Effect; and
 (F)       such other certificates, documents and information (including, without limitation, engineering and structural reports, permanent certificates of occupancy and evidence of zoning compliance, in each
case, with respect to each of the Coosa Pines Mill Real Property and the Grenada Mill Real Property) as may be reasonably requested by the U.S. Administrative Agent, all in form, consent and scope reasonably satisfactory to the U.S. Administrative
Agent.
 (iii)      In each case noted above, the U.S. Administrative Agent shall have
received, on behalf of itself, the Lenders and any other applicable Person, all accrued and unpaid fees, expenses or commissions payable to the Administrative Agent and the Lenders under this Agreement (including, without limitation, legal
(including, without limitation, local counsel) fees and expenses) and such amounts as may be due to any other Person in connection with the transactions contemplated hereby, including all taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of any of the Loan Documents.
 (f)        (i) As promptly as possible, but in no event later than November 26, 2008, the Administrative Agent shall have received:
 
	  
	 (A)
  
	 a duly
executed copy of each Canadian Fixed Asset Mortgage;

 (B)      a
duly executed copy of the equitable mortgage encumbering the Canadian Fixed Assets together with a copy of the applicable PPSA filings;
  
  
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 (C)      a duly executed amended and restated Pledge forming part of the Quebec Collateral Documents;

 (D)      evidence in form and substance reasonably satisfactory to the Administrative
Agent confirming the interest of the Administrative Agent as mortgagee with respect to any insurance on the real property constituting Canadian Fixed Assets that is subject to a Canadian Fixed Asset Mortgage;
 (E)       all filings and recordations that are necessary to perfect the security interests of
the Administrative Agent, on behalf of itself and the other Secured Parties, in the Canadian Fixed Assets granted by the applicable Credit Party under each Canadian Fixed Asset Mortgage and evidence satisfactory to the Administrative Agent that upon
such filings and recordations such security interests constitute valid and perfected first priority Liens therein;
 (F)       favorable opinions of counsel of the Credit Parties addressed to the Administrative Agent, the U.S. Administrative Agent, the Lenders and the U.S. Lenders with respect to each Canadian Fixed Asset
Mortgage and such other matters as the Lenders shall reasonably request, including for greater certainty, as to absence of breach of documents governing Borrower's Existing Notes (which such opinions shall expressly permit reliance by successors and
assigns of the Administrative Agent, the U.S. Administrative Agent, any Lender or any U.S. Lender);
 (G)      a final title insurance policy, insuring the first priority Liens of the Secured Parties and showing no Liens prior to the Liens of the Secured Parties (other than for ad valorem taxes not yet due and
payable) and containing only such other customary title exceptions as are reasonably acceptable to the Administrative Agent, with title insurance companies acceptable to the Administrative Agent, on the Canadian Fixed Assets subject to the Canadian
Fixed Asset Mortgages (it being agreed that the Borrower and its Subsidiaries shall provide or obtain any customary affidavits and indemnities as may be required or necessary to obtain title insurance satisfactory to the Administrative
Agent);
 (H)      copies of all recorded documents creating exceptions to the coverage of
the title insurance policies referred to in Section 8.10(f)(i)(G);
 (I)        results of a Lien search, in form and substance satisfactory thereto, made against each of the Credit Parties (except the U.S. Borrower);
 (J)       the Administrative Agent shall have received a certificate, in form and substance
satisfactory to the Administrative Agent, dated as of the date of the Canadian Fixed Asset Mortgages, providing a calculation (with details) of the aggregate amount of the Obligations (expressed in Canadian Dollars) capable of being secured without
triggering any requirement to provide Liens to any other
  
  
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 Person pursuant to the Existing Notes (such Indebtedness, the "Permitted Secured Indebtedness"), duly
certified by a Responsible Officer of the Borrower;
 (K)      the Administrative Agent
shall have received favorable opinions of counsel to the Credit Parties addressed to the Administrative Agent and the Lenders, including, without limitation, a no conflict opinion with respect to the Existing Notes issued by the Borrower and the
additional Collateral being provided to the Administrative Agent and the Lenders in connection with this Agreement; and
 (L)       such other instruments, documents and certificates as the Administrative Agent may reasonably request, including an officer's certificate with respect to the Existing Notes;
 (ii)       On or prior to December 15, 2008, the Administrative Agent shall have
received:
 (A)      an environmental assessment and such other environmental report
reasonably requested by the Administrative Agent regarding each of the real property locations comprising the Canadian Fixed Assets subject to the Canadian Fixed Asset Mortgages, in each case prepared by an environmental engineering firm acceptable
to the Administrative Agent showing no environmental conditions in violation of Environmental Laws or liabilities under Environmental Laws, either of which could reasonably be expected to have a Material Adverse Effect; and
 (B)      such other certificates, documents and information (including, without limitation, solvency
certificates, officer's certificates with respect to Existing Notes, permanent certificates of occupancy and evidence of zoning compliance, in each case, with respect to each of the real property locations comprising the Canadian Fixed Assets
subject to the Canadian Fixed Asset Mortgages) as may be reasonably requested by the Administrative Agent, all in form, consent and scope reasonably satisfactory to the Administrative Agent; and
 (iii)      On or prior to January 10, 2009, the Administrative Agent shall have received copies of
as-built surveys of a recent date of each of the real property locations comprising the Canadian Fixed Assets subject to the Canadian Fixed Asset Mortgages, in each case certified as of a recent date by a registered engineer or land surveyor and
addressed to the Administrative Agent and the Lenders (which survey shall expressly permit reliance by successors and assigns of the Administrative Agent and the Lenders). Each such survey shall be accompanied by a Survey Affidavit. Each such survey
shall show, without limitation, the area of such property, all boundaries of the land with courses and distances indicated, including chord bearings and arc and chord distances for all curves, and shall show dimensions and locations of all
easements, private drives, roadways, and other facts materially affecting such property, and shall show such other details as the Administrative Agent may reasonably request, including, without limitation, any encroachment (and the extent thereof,
in metric or imperial measures)
  
  
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 onto the
property or by any of the improvements on the property upon adjoining land or upon any easement burdening the property; any improvements, to the extent constructed, and the relation of the improvements by distances to the boundaries of the property,
to any easements burdening the property, and to the established building lines and the street lines; and if improvements are existing, (A) a statement of the number of each type of parking space required by Applicable Laws, ordinances, orders,
rules, regulations, restrictive covenants and easements affecting the improvement, and the number of each such type of parking space provided, and (B) the locations of all utilities serving the improvement.
 (g)       Prior to November 30, 2008, as such date may be extended by the Administrative Agent in its sole
discretion, the Administrative Agent shall have received (i) a duly executed copy of each applicable Foreign Pledge Document with respect to a pledge of one hundred percent (100%) of the total outstanding Korean Shares, including, without
limitation, if applicable, original stock certificates (or the equivalent thereof pursuant to the Applicable Laws and practices of the Republic of Korea) evidencing the Korean Shares, together with an appropriate undated stock power for each
certificate duly executed in blank by Bowater Lahave Corporation), (ii) such documents and certificates referred to in Section 5.2 as may be reasonably requested by the Administrative Agent in
connection therewith (including, without limitation, favorable legal opinions of counsel addressed to the Administrative Agent and the Lenders with respect to Korean Shares, the Loan Documents and such other matters as the Administrative Agent shall
reasonably request), and (iii) such other documents and certificates as may be reasonably requested by the Administrative Agent (in consultation with Bowater Lahave Corporation), all in form, content and scope reasonably satisfactory to the
Administrative Agent. Notwithstanding the foregoing, subject to Section 13.3, the Administrative Agent may waive any or all of the requirements contained in this Section 8.10(g)
 to the extent that, in the sole discretion of the Administrative Agent, they are impracticable or pose a materially undue burden on Bowater Lahave Corporation or on Bowater-Korea Co., Ltd.
 (h)       In each case noted in Section 8.10(f) or 8.10(g) above, the Administrative Agent shall have received, on behalf of itself, the Lenders and any other applicable Person, all accrued and unpaid fees, expenses or commissions payable to the Administrative Agent
and the Lenders under this Agreement (including, without limitation, legal (including, without limitation, local counsel) fees and expenses) and such amounts as may be due to any other Person in connection with the transactions contemplated hereby,
including all taxes, fees and other charges in connection with the execution, delivery, recording, filing and registration of any of the Loan Documents.
 SECTION 8.11       Use Of Proceeds. The Borrower shall use the proceeds of the Extensions of Credit (a) to
finance the acquisition of Capital Assets, (b) to refinance the Existing Facilities and (c) for working capital and general corporate purposes of the U.S. Borrower and its Subsidiaries, including the payment of certain fees and expenses incurred in
connection with this Agreement.
 SECTION 8.12       Further Assurances. Make, execute and
deliver all such additional and further acts, things, deeds and instruments as the Administrative Agent or the Required Agreement Lenders (through the Administrative Agent) may reasonably require to
  

  
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 document and consummate the transactions contemplated hereby and to vest completely in and insure the Administrative Agent and the Lenders their respective rights under
this Agreement, the Letters of Credit and the other Loan Documents.
 ARTICLE IX
  
 FINANCIAL COVENANTS
 Until all of the Obligations have been paid and satisfied in full and the Commitment terminated, unless consent has been obtained in the manner set
forth in Section 14.2, the U.S. Borrower and its Subsidiaries on a Consolidated basis will not:
 SECTION 9.1   Consolidated
Senior Secured Leverage Ratio. As of any fiscal quarter end, permit the Consolidated Senior Secured Leverage Ratio to be greater than the corresponding ratio set forth below:
  
 
	 Applicable Period
	 Maximum Ratio

	 Third Amendment Effective Date to March 31, 2008
	 4.50 to 1.00

	 April 1, 2008 through and including June 30, 2008
	 2.75 to 1.00

	 July 1, 2008 through and including September 30, 2008
	 1.50 to 1.00

	 October 1, 2008 through and including December 31, 2008
	 1.40 to 1.00

	 January 1, 2009 and thereafter
	 1.25 to 1.00

  
 SECTION 9.2    Interest Coverage
Ratio. As of any fiscal quarter ending during the periods specified below, permit the ratio of (a) the sum, without duplication, of (i) Consolidated Adjusted EBITDA for the period of four (4) consecutive fiscal quarters ending on or immediately
prior to such date, plus (ii) the amount of Specified Non-Recurring Charges taken during the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date, to (b) Consolidated Interest Expense paid or payable in cash for
the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date, to be less than the corresponding ratio set forth below:
  
 
	 Applicable Period
	 Minimum Ratio

	 Third Amendment Effective Date to March 31, 2008
	 0.75 to 1.00

	 April 1, 2008 through and including June 30, 2008
	 1.00 to 1.00

  
  

  
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	 July 1, 2008 through and including September 30, 2008
	 1.40 to 1.00

	 October 1, 2008 through and including December 31, 2008
	 1.75 to 1.00

	 January 1, 2009 and thereafter
	 2.00 to 1.00

  
 ARTICLE X
  
 NEGATIVE COVENANTS
 Until all of the Obligations have been paid and satisfied in full and the Commitment terminated, unless consent has been obtained in the manner set
forth in Section 14.2, the U.S. Borrower and the Borrower will not and will not permit any of their respective Subsidiaries to:
 SECTION
10.1      Limitations On Indebtedness. Create, incur, assume or suffer to exist any Indebtedness except:
 (a)       (i) the Obligations (excluding Hedging Obligations permitted pursuant to Section 10.1(c)) and (ii) the Guaranty Obligations in favor of the Administrative Agent for the benefit of the Secured
Parties;
 (b)       (i) the U.S. Obligations (excluding any U.S. Obligations pursuant to Hedging
Agreements permitted pursuant to Section 10.1(c)) and (ii) the Guaranty Obligations in respect of the U.S. Obligations in favor of the U.S. Administrative Agent for the benefit of the U.S. Secured Parties;
 (c)       Indebtedness incurred in connection with a Hedging Agreement (i) which is entered into for interest rate,
foreign currency or other business purposes and not for speculative purposes and (ii) with a counterparty reasonably satisfactory to the Administrative Agent and the U.S. Administrative Agent; provided that any counterparty that is a Lender, a U.S. Lender or any Affiliate thereof shall be deemed satisfactory to the Administrative Agent and the U.S. Administrative Agent;
 (d)       Indebtedness existing on the Closing Date and not otherwise permitted under this Section and, to the
extent that the outstanding principal amount of such Indebtedness is in excess of $25,000,000, listed on Schedule 10.1 (including any Indebtedness (including, without limitation, any Guaranty Obligation
of Indebtedness of another Person but excluding the April 2008 Convertible Indebtedness) issued to refinance or to refund such Indebtedness or any Indebtedness which constitutes a renewal or extension of such Indebtedness); provided that (i) the principal amount of such Indebtedness may not be increased at the time of such refinancing, refunding, renewal or extension except (A) by an amount equal to a reasonable premium or other
reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing, refunding, renewal or extension and by an amount equal to any existing
  

  
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 commitments unutilized thereunder and (B) by additional amounts, to the extent that the Consolidated Total Leverage Ratio, on a pro
forma basis after giving effect to such increase, would be no greater than 5.50 to 1.00, (ii) no Default or Event of Default exists and is continuing or would be caused by the refinancing, refunding, renewal
or extension thereof, (iii) the Administrative Agent and the U.S. Administrative Agent shall have received satisfactory written evidence that the U.S. Borrower and its Subsidiaries would be in compliance with all covenants in this Agreement and the
U.S. Credit Agreement on a pro forma basis after giving effect to the refinancing, refunding, renewal or extension thereof, (iv) the weighted average life of such Indebtedness
shall not be shorter than the weighted average life of the Indebtedness being refinanced, refunded, renewed or extended, (v) any terms of subordination set forth in the Indebtedness being refinanced, refunded, renewed or extended are not adversely
affected in any material respect, (vi) if the Indebtedness being refinanced is not secured by the assets of any Credit Party or its Subsidiaries or any U.S. Credit Party or its Subsidiaries, such refinancing Indebtedness shall also not be secured by
the assets of any Credit Party or its Subsidiaries or any U.S. Credit Party or its Subsidiaries and (vii) none of the Existing Notes nor any Indebtedness incurred in accordance with this paragraph to refinance, refund, renew or extend the Existing
Notes shall be guaranteed by the U.S. Borrower or any of its Subsidiaries (other than (A) those Existing Notes which are guaranteed by the U.S. Borrower as of the Closing Date and identified on Schedule 10.1 as being so guaranteed and (B) any Indebtedness issued to refinance any Existing Notes which, as of the Closing Date, (1) have an outstanding principal balance in excess of $50,000,000 and (2) mature or are subject to mandatory redemption
prior to the U.S. Maturity Date);
 (e)       Indebtedness incurred in connection with Capital Leases,
including those Capital Leases existing on the Closing Date, and purchase money Indebtedness, including all purchase money Indebtedness existing on the Closing Date, in an aggregate amount not to exceed $50,000,000 on any date of
determination;
 (f)        (i)        Guaranty
Obligations with respect to Indebtedness permitted pursuant to subsections (c), (e), (h), (l), (m) and (n) of this Section (provided that any Guaranty
Obligations of Indebtedness incurred pursuant to subsection (h) or, to the extent applicable, subsection (n)of this Section shall be subordinated to the Obligations and the U.S. Obligations to the same
extent as the Indebtedness that is being guaranteed); or
 (ii)       Guaranty
Obligations of the Original U.S. Borrower with respect to the April 2008 Convertible Indebtedness; provided that (A) the Original U.S. Borrower shall not be permitted to create, incur, assume or suffer
to exist such Guaranty Obligations unless (1) it shall have delivered to the U.S. Administrative Agent evidence, in form and substance reasonably satisfactory to the U.S. Administrative Agent, that the Abitibi Entities shall have consummated (or
will concurrently consummate) their previously announced financing plan which will consist of the following: (x) $250,000,000 to $325,000,000 of new senior unsecured exchange notes of Abitibi, (y) $350,000,000 to $450,000,000 of new 364-day term
loans of Abitibi and (z) approximately $400,000,000 of new senior secured notes or a term loan of Abitibi not to exceed a five year term (provided that Abitibi may replace or amend the financings
described in this clause (A)(1) above so long as such replacement or amendment consists of non-convertible debt financings of Abitibi that are not guaranteed by, or secured by the assets of, the U.S.
  
  
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 Borrower or any
of its Subsidiaries and would not reduce the aggregate amount of proceeds reflected above in this clause (A) in excess of $50,000,000) or (2) the proceeds of such Indebtedness are used to permanently reduce, on a pro rata basis, the Commitment under
this Agreement and the U.S. Commitment and to permanently repay, on a pro rata basis, Extensions of Credit under this Agreement and U.S. Extensions of Credit under the U.S. Credit Agreement or for such other use approved in writing by the Required
Lenders (it being understood that any use that involves the reduction of the commitments or repayment of the extensions of credit under this Credit Facility or the U.S. Credit Facility shall continue to be applied to this Credit Facility and the
U.S. Credit Facility on a pro rata basis unless otherwise agreed to by the Required Agreement Lenders and the U.S. Required Agreement Lenders); and (B) such Guaranty Obligations shall be unsecured and shall not exceed $350,000,000 in an aggregate
principal amount (plus any paid-in-kind interest thereon) on any date of determination;
 (g)       (i)        (A) Indebtedness owed by any U.S. Credit Party to any other U.S. Credit Party, including, without limitation, Indebtedness evidenced by the New
U.S. Borrower Notes (provided that, if requested by the U.S. Administrative Agent, such Indebtedness shall be subordinated to the U.S. Obligations on terms and conditions reasonably satisfactory to the
U.S. Administrative Agent) and (B) Indebtedness owed by any Credit Party (other than the U.S. Borrower) to any other Credit Party (other than the U.S. Borrower) (provided that, if requested by the
Administrative Agent, such Indebtedness shall be subordinated to the Obligations on terms and conditions reasonably satisfactory to the Administrative Agent);
 (i)        (A) Indebtedness owed by any Credit Party (other than the U.S. Borrower) to any U.S. Credit Party (
provided that such Indebtedness shall be payable by such Credit Party on demand by the applicable U.S. Credit Party) and (B) Indebtedness owed by any U.S. Credit Party to any Credit Party
(provided that such Indebtedness shall be payable by such U.S. Credit Party (other than the U.S. Borrower) on demand by the applicable Credit Party);
 (ii)       Indebtedness owed by any Subsidiary which is not a U.S. Credit Party or a Credit Party to any other
Subsidiary which is not a U.S. Credit Party or a Credit Party;
 (iii)      Indebtedness owed by any U.S.
Credit Party or any Credit Party to a Subsidiary that is not a U.S. Credit Party or a Credit Party (provided that such Indebtedness (other than Indebtedness existing as of the Closing Date pursuant to
the Bowater-Calhoun Arrangement) shall be subordinated to the U.S. Obligations and the Obligations, as applicable, pursuant to an Intercompany Subordination Agreement); and
 (iv)      (A) Indebtedness owed by any Subsidiary that is not a U.S. Credit Party or a Credit Party to a U.S. Credit Party
or a Credit Party (provided that such Indebtedness shall be payable by such Subsidiary on demand by the U.S. Credit Party or the Credit Party, as applicable, to the extent required pursuant to the
Intercompany Subordination Agreement); provided that the aggregate amount of such Indebtedness, together with any equity or capital investments and permitted pursuant to Section 10.3(g) (without
duplication), shall not exceed $35,000,000 outstanding on any date of determination (which amount shall be calculated as the net balance of such loans, advances and investments as reduced by any repayments or
  

  
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 distributions made with respect thereto) and (B) any loans and advances made by the U.S. Borrower to Bowater Canada Finance Corporation to pay interest on the BCFC Notes;

 (h)       Subordinated Indebtedness; provided that in
the case of each issuance of Subordinated Indebtedness, (i) no Default or Event of Default shall have occurred and be continuing or would be caused by the issuance of such Subordinated Indebtedness, (ii) the Consolidated Total Leverage Ratio
on pro forma basis after giving effect to issuance of such Subordinated Indebtedness is no greater than 5.50 to 1.00 and (iii) the U.S. Administrative Agent and the
Administrative Agent shall have received satisfactory written evidence that the U.S. Borrower and its Subsidiaries would be in compliance with all covenants contained in this Agreement and the U.S. Credit Agreement on a pro
 forma basis after giving effect to the issuance of any such Subordinated Indebtedness;
 (i)        Indebtedness of the U.S. Borrower or any of its Subsidiaries as an account party in respect of trade letters of credit in an aggregate amount not to exceed $25,000,000 on any date of
determination; provided that no such trade letter of credit shall be secured by any assets of the U.S. Borrower or any of its Subsidiaries other than the assets being acquired or shipped pursuant to
such letter of credit;
 (j)        Indebtedness (i) of any Person that becomes a Subsidiary after
the Closing Date in connection with any Permitted Acquisition or (ii) assumed in connection with any assets acquired in connection with any Permitted Acquisition, and the refinancing, refunding, renewal and extension (but not the increase in the
aggregate principal amount) thereof; provided that (A) such Indebtedness exists at the time such Person becomes a Subsidiary or such assets are acquired and is not created in contemplation of, or in
connection with, such Person becoming a Subsidiary or such assets being acquired and (B) notwithstanding anything to the contrary contained in this Agreement, neither the U.S. Borrower nor any other Subsidiary (other than such Person) shall have any
liability or other obligation with respect to such Indebtedness (other than any liability or other obligation of the U.S. Borrower or any of its Subsidiaries permitted hereunder which existed prior to the time that such Person became a Subsidiary or
such asset was acquired);
 
	  
	 (k)
	 [Intentionally Omitted];

 
	  
	 (l)
	 [Intentionally Omitted];

 (m)      unsecured Indebtedness in a minimum
principal amount of no less than $150,000,000; provided that (i) no Default or Event of Default has occurred or would result after giving effect thereto, (ii) the U.S. Borrower and its Subsidiaries
would be in compliance with all covenants contained in Article IX on a pro forma basis after giving effect thereto, (iii) the
Net Cash Proceeds of any such Debt Issuance permitted pursuant to this clause (m) shall be applied pursuant to, and in accordance with, Section 8.2(b) and
(iv) the terms and conditions applicable to such Indebtedness shall be reasonably satisfactory to the Administrative Agent and the U.S. Administrative Agent; and
  

  
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 (n)       Additional Indebtedness outstanding as of the Tenth Amendment Effective Date not otherwise permitted
pursuant to this Section in an aggregate amount not to exceed $25,000,000.
 SECTION
10.2      Limitations On Liens. Create, incur, assume or suffer to exist, any Lien on or with respect to any of its assets or properties (including, without limitation, shares of Capital Stock), real or personal,
whether now owned or hereafter acquired, except:
 (a)       (i) Liens of the Administrative Agent for
the benefit of the Secured Parties, (ii) Liens of the U.S. Administrative Agent for the benefit of the U.S. Secured Parties and (iii) Liens on the New U.S. Borrower Fixed Assets of the U.S. Administrative Agent for the benefit of the Secured Parties
and the U.S. Secured Parties pursuant to the New U.S. Borrower Mortgages;
 (b)       Liens not
otherwise permitted by this Section and in existence on the Closing Date and, with respect to each Credit Party and each U.S. Credit Party, described on Schedule 10.2 (including Liens incurred in
connection with any refinancing, refunding, renewal or extension of Indebtedness pursuant to Section 10.1(d) solely to the extent that the such Liens were in existence on the Closing Date and described on Schedule
10.2; provided that the scope of any such Lien shall not be increased, or otherwise expanded, to cover any additional property or type of asset, as applicable, beyond that in
existence on the Closing Date);
 (c)       Liens for taxes, assessments and other governmental charges
or levies not yet due or as to which the period of grace (not to exceed thirty (30) days), if any, related thereto has not expired or which are being contested in good faith and by appropriate proceedings if adequate reserves are maintained to the
extent required by GAAP;
 (d)       the claims of materialmen, mechanics, carriers, warehousemen,
processors or landlords for labor, materials, supplies or rentals incurred in the ordinary course of business, (i) which are not overdue for a period of more than thirty (30) days or (ii) which are being contested in good faith and by appropriate
proceedings if adequate reserves are maintained to the extent required by GAAP;
 (e)       Liens
consisting of deposits or pledges made in the ordinary course of business in connection with, or to secure payment of, obligations under workers' compensation, unemployment insurance or similar legislation;
 (f)        Liens constituting encumbrances in the nature of zoning restrictions, easements and rights or
restrictions of record on the use of real property or other similar restrictions, which do not, in any case, impair the use thereof in the ordinary conduct of business;
 (g)       Liens securing Indebtedness permitted under Section 10.1(e); provided
that (i) such Liens shall be created substantially simultaneously with the acquisition or lease of the related asset, (ii) such Liens do not at any time encumber any property other than the property financed by such Indebtedness, (iii)
the amount of Indebtedness secured thereby is not increased and (iv) the principal amount of Indebtedness secured by any such Lien shall at no time exceed one hundred percent (100%) of the original purchase price or lease payment amount of such
property at the time it was acquired;
  
  
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 (h)       Liens securing judgments for the payment of money not constituting an Event of Default under Section 12.1(m) or securing appeal or other surety bonds relating to such judgments;
 (i)        Liens on tangible property or tangible assets of the U.S. Borrower or any of its Subsidiaries
acquired pursuant to a Permitted Acquisition, or on tangible property or tangible assets of any Subsidiary of the U.S. Borrower which are in existence at the time that such Subsidiary of the U.S. Borrower is acquired pursuant to a Permitted
Acquisition (provided that such Liens (i) are not incurred in connection with, or in anticipation of, such Permitted Acquisition, (ii) are applicable only to specific tangible property or tangible
assets, (iii) are not "blanket" or all asset Liens and (iv) do not attach to any other property or assets of the U.S. Borrower or any of its Subsidiaries);
 (j)        Liens in existence as of the Closing Date in connection with the Bowater-Calhoun Arrangement as
described in clause (b) of the definition thereof;
 
	  
	 (k)
	 [Intentionally Omitted];

 
	  
	 (l)
	 [Intentionally Omitted];

 (m)      Liens existing on the Tenth Amendment
Effective Date and not otherwise permitted hereunder securing obligations not at any time exceeding in the aggregate $25,000,000.
 SECTION 10.3       Limitations On Loans, Advances, Investments And Acquisitions. Purchase, own, invest in or otherwise acquire, directly or indirectly, any Capital Stock, interests in any partnership
or joint venture (including, without limitation, the creation or capitalization of any Subsidiary), evidence of Indebtedness or other obligation or security, all or substantially all of the business or assets of any other Person (or any portion of
the business or assets of any other Person that constitutes a line of business, a business unit or a division) or any other investment or interest whatsoever in any other Person, or make or permit to exist, directly or indirectly, any loans,
advances or extensions of credit to, or any investment in cash or by delivery of property in, any Person (collectively, "Investments") except:
 
	  
	 (a)
	 Investments:

 (i)        existing on the Closing Date in Subsidiaries existing on the
Closing Date;
 (ii)       after the Closing Date in Subsidiaries formed after the Closing Date so long
as the U.S. Borrower, the Borrower and their respective Subsidiaries comply with the applicable provisions of Section 8.10of this Agreement and Section 8.10 of the U.S. Credit Agreement;
 (iii)      existing on the Closing Date (other than Investments in Subsidiaries on the Closing Date) and described
on Schedule 10.3;
 
	  
	 (b)
	 subject to
 Section 10.14, Investments in cash and Cash Equivalents;

  
 

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	 (c)
	 [Intentionally Omitted];

 
	  
	 (d)
	 Hedging
Agreements permitted pursuant to Section 10.1;

 (e)       Investments in the
form of loans and advances to employees in the ordinary course of business, which, in the aggregate, do not exceed at any time $2,000,000;
 (f)        (i) Investments in the form of intercompany Indebtedness permitted pursuant to Section 10.1(g) (other than clause (v) of Section 10.1(g)), but
including, without limitation, Investments by the Original U.S. Borrower in the Parent evidenced by the New U.S. Borrower Notes so long as each of the New U.S. Borrower Notes is pledged as security for the U.S. Obligations and delivered to the U.S.
Administrative Agent, for the ratable benefit of the U.S. Secured Parties, in each case, pursuant to the terms of the U.S. Collateral Agreement), (ii) equity or capital investments made by the U.S. Borrower or any of its Subsidiaries in any U.S.
Credit Party or any Credit Party (or made in a Wholly-Owned Subsidiary that is not a U.S. Credit Party or a Credit Party and immediately contributed (directly or indirectly through one or more intermediate Wholly-Owned Subsidiaries) into a U.S.
Credit Party or a Credit Party) and (iii) equity or capital investments made by any Subsidiary that is not a U.S. Credit Party or a Credit Party in any other Subsidiary that is not a U.S. Credit Party or a Credit Party;
 (g)       (i) Investments in the form of intercompany Indebtedness permitted by clause (v) of Section 10.1(g),
together with equity or capital investments made by any U.S. Credit Party or any Credit Party to any Subsidiary which is not a U.S. Credit Party or a Credit Party; provided that the aggregate amount of
such intercompany Indebtedness and equity or capital investments, shall not exceed $35,000,000 outstanding as of any date of determination (which amount shall be calculated as the net balance of such loans, advances and equity or capital investments
as reduced by any repayments or distributions made with respect thereto) and (ii) any loans and advances made by the U.S. Borrower to Bowater Canada Finance Corporation to pay interest on the BCFC Notes;
 
	  
	 (h)
	 [Intentionally Omitted]; and

 (i)        Investments existing on
the Tenth Amendment Effective Date and not otherwise permitted hereunder (including minority investments in joint ventures) in an aggregate amount not to exceed $20,000,000 (which amount shall be calculated as the net balance of such Investments as
reduced by any repayments or distributions made with respect thereto).
 SECTION
10.4           LIMITATIONS ON MERGERS AND LIQUIDATION. Merge, amalgamate, consolidate or enter into any similar combination with any other Person or liquidate, wind-up or dissolve itself (or
suffer any liquidation or dissolution) except:
 (a)       any Wholly-Owned Subsidiary of the U.S.
Borrower may be merged, amalgamated or consolidated with or into:
 (i)        the U.S. Borrower (provided that the continuing or surviving Person shall be the U.S. Borrower); or
  

  
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 (ii)       any other Wholly-Owned Subsidiary of the U.S. Borrower (provided that the continuing or surviving Person shall (A) be a U.S. Subsidiary Guarantor in the case of a merger, amalgamation or consolidation involving a U.S. Subsidiary Guarantor, (B) include the Borrower in the
case of a merger, amalgamation or consolidation involving the Borrower or (C) subject to clauses (i) and (ii)(B) above, be a Guarantor in the case of a merger, amalgamation or consolidation involving a Guarantor);
 provided further that no U.S. Credit Party may be merged, amalgamated or consolidated with or into a Credit Party
(other than the U.S. Borrower) and no Credit Party (other than the U.S. Borrower) may be merged, amalgamated or consolidated with or into a U.S. Credit Party;
 (b)       any Wholly-Owned Subsidiary of the U.S. Borrower may merge or amalgamate into the Person such
Wholly-Owned Subsidiary was formed to acquire in connection with a Permitted Acquisition;
 (c)       any Wholly-Owned Subsidiary of the U.S. Borrower may merge or amalgamate into any Person pursuant to an Asset Disposition of all of the assets of such Wholly-Owned Subsidiary permitted pursuant to
Section 10.5; and
 (d)       any Subsidiary of the U.S. Borrower (other than the Borrower) may
wind-up, liquidate or dissolve; provided that (i) its assets are transferred to the U.S. Borrower or any Wholly-Owned Subsidiary of the U.S. Borrower and (ii) if such Subsidiary is (A) a U.S. Subsidiary
Guarantor then the transferee shall be a U.S. Credit Party and (B) a Guarantor (other than the U.S. Borrower) then the transferee shall be a Credit Party.
 SECTION 10.5           LIMITATIONS ON ASSET DISPOSITIONS. Make any Asset Disposition
(including, without limitation, the sale of any receivables and leasehold interests and any sale-leaseback or similar transaction) except:
 
	  
	 (a)
	 the sale of
inventory in the ordinary course of business;

 (b)       the sale of
obsolete, worn-out or surplus assets in the ordinary course of business that are no longer used or usable in the business of the U.S. Borrower or any of its Subsidiaries;
 (c)       the transfer of assets to the U.S. Borrower, the Borrower or any Wholly-Owned Subsidiary (provided that, in the case of any such transfer of assets, (i) if the transferee of such assets is a U.S. Credit Party or a Credit Party, such U.S. Credit Party or Credit Party shall not pay more than the fair market
value of such assets (determined as of the date of the applicable transfer) and (ii) if the transferor of such assets is a U.S. Credit Party or a Credit Party, the transferee shall not pay less than the fair market value of such assets (determined
as of the date of the applicable transfer);
 (d)       the U.S. Borrower or any Subsidiary may
write-off, discount, sell or otherwise dispose of defaulted or past due receivables and similar obligations in the ordinary course of business and not as part of an accounts receivable financing transaction;
 
	  
	 (e)
	 the
disposition of any Hedging Agreement;

  
  
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	 (f)
	 the
disposition of cash or Cash Equivalents;

 
	  
	 (g)
	 the sale of
timberlands by the U.S. Borrower or its Subsidiaries;

 (h)       the transfer
by the Original U.S. Borrower of the Capital Stock of the New U.S. Borrowers to the Parent in connection with the New U.S. Borrower Transactions in exchange for a promissory note or promissory notes, in form and substance satisfactory to the U.S.
Administrative Agent, payable by the Parent to the Original U.S. Borrower (such notes, as amended, restated, supplemented or otherwise modified, the "New U.S. Borrower Notes");
 
	  
	 (i)
	 [Intentionally Omitted]; and

 (j)        Asset Dispositions of
all or any portion of the New U.S. Borrower Fixed Assets, the Canadian Fixed Assets, the Korean Fixed Assets or the Korean Shares; provided that:
 
	  
	 (i)
	 such Asset
Disposition shall be for no less than fair market value;

 (ii)       both before and after giving to such Asset Disposition, no Default or Event of Default shall have occurred and be continuing;
 (iii)      the U.S. Borrower shall be in pro forma
 compliance with each of the covenants set forth in Article IX;
 (iv)      the terms of such Asset Disposition shall be reasonably satisfactory to the Administrative Agent and the U.S. Administrative Agent, each in its sole discretion; and
 (k)       additional Asset Dispositions not otherwise permitted pursuant to this Section in an aggregate amount not
to exceed $250,000,000 in the aggregate during the term of this Agreement (it being understood and agreed that this clause (k) shall not permit the sale of any New U.S. Borrower Fixed Assets).
 Notwithstanding anything to the contrary contained herein, the Net Cash Proceeds of any Asset Disposition permitted pursuant to this Section 10.5
 shall be applied in accordance with Section 8.2(b), to the extent required by such Section 8.2(b).
 SECTION 10.6           LIMITATIONS ON DIVIDENDS AND DISTRIBUTIONS. Declare or pay any dividends
upon any of its Capital Stock; purchase, redeem, retire or otherwise acquire, directly or indirectly, any shares of its Capital Stock, or make any distribution of cash, property or assets among the holders of shares of its Capital Stock, or make any
change in its capital structure which such change in its capital structure could reasonably be expected to have a Material Adverse Effect; provided that:
 (a)       the U.S. Borrower or any Subsidiary may pay dividends in shares of its own Capital Stock;
 (b)       the U.S. Borrower or any Subsidiary may make cash distributions or equity repurchases pursuant to
employee benefit plans or incentive compensation plans, in each case to
  
  
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 the extent such distributions constitute compensation to executives or employees of the U.S. Borrower or of the applicable Subsidiary;
 (c)       any Subsidiary may pay dividends to the holders of its Capital Stock (other than payment of dividends to
holders of the Exchangeable Shares); provided that in the case of any dividend paid by a Subsidiary that is not a Wholly-Owned Subsidiary, such dividend may be paid only if such dividend is paid on a
ratable basis to the holders of such Capital Stock in accordance with their respective ownership percentages in such Subsidiary;
 
	  
	 (d)
	 [Intentionally Omitted];

 
	  
	 (e)
	 [Intentionally Omitted];

 (f)        Bowater Canada, Inc. or
Bowater Canadian Holdings Incorporated may repurchase all or a portion of the Exchangeable Shares solely through an exchange of common stock of the Parent for the Exchangeable Shares being repurchased;
 
	  
	 (g)
	 the U.S.
Borrower may make dividends and distributions to the Parent to pay:

 (i)        taxes attributable to the consolidated operations of the U.S. Borrower and its Subsidiaries;
 (ii)       the Parent Overhead Expenses in an aggregate amount per Fiscal Year not to exceed
fifty percent (50%) of the aggregate amount of Parent Overhead Expenses during such Fiscal Year; and
 (iii)      so long as no Default or Event of Default has occurred and is continuing or would result after giving effect to such dividends or distributions, an additional amount of Parent Overhead Expenses in an
aggregate amount not to exceed $10,000,000 per Fiscal Year;
 
	  
	 (h)
	 [Intentionally Omitted];

 (i)        subject to Section
12.1(o)(ix); so long as no Default or Event of Default shall have occurred and be continuing or would be caused thereby, the Borrower may make cash distributions or dividends to the Parent which shall be invested in a U.S. Credit Party;
and
 (j)        subject to Section 10.10 and Section
12.1(o)(viii)(E), the U.S. Borrower and its Subsidiaries may make cash distributions or dividends to the Parent to allow the Parent to make required payments on Indebtedness incurred by the Parent as permitted pursuant to
Section 12.1(o)(viii); provided that on each date any distribution or dividend is paid and after giving effect thereto:
 (i)        no Default or Event of Default shall have occurred and be continuing;
and
 (ii)       the U.S. Borrower shall be in pro forma compliance with each of
the covenants set forth in Article IX and Section 12.1(o)(ix).
  
  
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 SECTION 10.7           LIMITATIONS ON EXCHANGE AND ISSUANCE OF CAPITAL STOCK. Except to the extent included as
Indebtedness and incurred in accordance with Section 10.1 hereof, issue, sell or otherwise dispose of any class or series of Capital Stock that, by its terms or by the terms of any security into which it is convertible or exchangeable, is, or upon
the happening of an event or passage of time would be, (a) convertible or exchangeable into Indebtedness unless such Indebtedness is permitted at the time pursuant to Section 10.1or (b) required to be redeemed or repurchased, including at the option
of the holder, in whole or in part, or has, or upon the happening of an event or passage of time would have, a redemption or similar payment due.
 SECTION
10.8           TRANSACTIONS WITH AFFILIATES. Directly or indirectly (a) make any loan or advance to, or purchase or assume any note or other obligation to or from, any of its officers,
directors, shareholders or other Affiliates, or to or from any member of the immediate family of any of its officers, directors, shareholders or other Affiliates, or subcontract any operations to any of its Affiliates or (b) enter into, or be a
party to, any other transaction not described in clause (a) above with any of its Affiliates other than:
 (i)        transactions permitted by Section 10.3, Section 10.4, Section 10.6 or Section 10.7 ;
 (ii)       transactions existing on the Closing Date and described on Schedule 10.8;
 (iii)      normal compensation and
reimbursement of reasonable expenses of officers and directors; and
 (iv)      other
transactions in the ordinary course of business on terms as favorable as would be obtained by it on a comparable arms-length transaction with an independent, unrelated third party.
 SECTION 10.9 CERTAIN ACCOUNTING CHANGES; ORGANIZATIONAL DOCUMENTS.
 (a)       Change its Fiscal Year end, or make any change in its accounting treatment and reporting practices except
as required by GAAP.
 (b)       Amend, modify or change its articles of incorporation (or corporate
charter or other similar organizational documents) or amend, modify or change its bylaws (or other similar documents) in any manner which materially adversely affects the rights or interests of the Lenders or the U.S. Lenders.
 SECTION 10.10           AMENDMENTS; PAYMENTS AND PREPAYMENTS OF
INDEBTEDNESS.
 (a)       Amend, modify or change any indenture or other agreement governing the
Existing Notes in any respect which would materially adversely affect the rights or interests of the U.S. Administrative Agent, the Administrative Agent, the U.S. Lenders and the Lenders.
  

  
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 (b)       Amend, modify or change (i) any provision of this Agreement which, under Section 14.2, is subject to the
approval of the Required Lenders without amending, modifying or changing the corresponding provision in the U.S. Credit Agreement or (ii) any provision of the U.S. Credit Agreement which, under Section 13.2 of the U.S. Credit Agreement, is subject to the approval of the Required Lenders without amending, modifying or changing the corresponding provision in this Agreement.
 (c)       Amend or modify (or permit the modification or amendment of) any of the terms or provisions of any
Subordinated Indebtedness or any Indebtedness incurred pursuant to Section 10.1(m), in each case, in any respect which would materially adversely affect the rights or interests of the U.S.
Administrative Agent, the Administrative Agent, the U.S. Lenders and the Lenders.
 (d)       Cancel,
forgive, make any payment (other than regularly scheduled interest payments) or prepayment on, or redeem or acquire for value (including, without limitation, by way of depositing with any trustee with respect thereto money or securities before due
for the purpose of paying when due, but excluding payments at the scheduled maturity thereof) all or any portion of any Subordinated Indebtedness (other than Indebtedness incurred pursuant to Section 10.1(g)(i)), any Indebtedness incurred pursuant to Section 10.1(m), the Existing Notes or any Indebtedness incurred to refinance the Existing Notes as permitted pursuant to Section 10.1(d), except for:

 (i)        refinancings, refundings, renewals, extensions or exchange of
any Subordinated Indebtedness permitted by Section 10.1(h) subject to the satisfaction of each of the conditions to a refinance, refunding, renewal or extension set forth in Section 10.1(d);
 
	  
	 (ii)
	 [Intentionally Omitted];

 (iii)      refinancings,
refundings, renewals, extensions or exchange of any Existing Notes permitted by Section 10.1(d); and
 (iv)      cash redemptions or repayments of the Existing Notes or any Indebtedness incurred to refinance the Existing Notes as permitted pursuant to Section 10.1(d); provided
that (A) no Default or Event of Default shall have occurred and be continuing at the time of such redemption or repayment or would result from such redemption or repayment and (B) if at the time of such redemption or repayment (or
immediately after giving effect thereto), the Aggregate Credit Exposure exceeds $100,000,000, the Administrative Agent shall have received satisfactory written evidence that:
 (1)       the U.S. Borrower and its Subsidiaries would be in compliance with all covenants in
this Agreement on a pro forma basis after giving effect to such redemption;
 (2)       the principal amount of availability under this Credit Facility and the U.S. Credit
Facility both before and after giving effect to such redemption is equal to or greater than $50,000,000;
  
  
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 (3)       the Consolidated Total Senior Secured Indebtedness, both before and immediately after
giving effect thereto, is less than or equal to eighty percent (80%) of the net book value of the U.S. Coverage Assets as set forth on the Consolidated balance sheet of the U.S. Borrower and its Consolidated Subsidiaries most recently delivered
pursuant to Section 5.2 or Section 7.1 hereof; and
 (4)       the principal amount
of outstanding Extensions of Credit, both before and immediately after giving effect thereto, is less than or equal to fifty percent (50%) of the net book value of the Coverage Assets as set forth on the Consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries most recently delivered pursuant to Section 5.2 or Section 7.1 hereof.
 (e)       Amend, modify, waive or supplement (or permit the modification, amendment, waiver or supplement of) any of the terms or provisions of the April 2008 Convertible Indebtedness (including the Purchase
Agreement dated March 24, 2008 by and between the Parent and Fairfax Financial Holdings Limited (including the exhibits and schedules thereto) and each other material document, instrument, certificate and agreement executed or delivered in
connection therewith), other than the waiver of any of the closing conditions set forth in Section 6 of the Purchase Agreement, in any respect which would adversely affect the rights or interests of the Administrative Agent, the U.S. Administrative
Agent, the Lenders and the U.S. Lenders
 
	  
	 Section 10.11

	 Restrictive
Agreements.

 
	  
	 (a)
	 Enter into
any Indebtedness which:

 (i)        contains any
covenants more restrictive than the provisions of Article VIII, Article IX, Article X, or
 (ii)       contains any negative pledge on assets or restricts, limits or otherwise encumbers its ability to incur Liens on or with respect to any of its assets or properties other than the assets or
properties securing such Indebtedness (other than (A) the Existing Notes (provided that such provisions may not be amended or modified to be more restrictive), (B) any Indebtedness incurred in
accordance with Section 10.1(d) to refinance the Existing Notes (provided that such provisions may not be more restrictive than those contained in the Existing Notes), (C) the U.S. Credit Facility (
provided that such provisions shall not be amended or modified except as permitted hereunder and thereunder) and (D) any Indebtedness incurred pursuant to Section
10.1(m) (provided that such provisions may not be more restrictive than those contained in this Agreement).
 (b)       Enter into or permit to exist any agreement which impairs or limits the ability of any Subsidiary to pay
dividends to the U.S. Borrower or to make or repay loans or advances to the U.S. Borrower other than (i) restrictions and conditions imposed by Applicable Law or the Loan Documents, (ii) legally enforceable restrictions and conditions which are
permitted by clause (iii) of Section 6.1(n) and (iii) customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary or its assets pending such sale; provided that
such
  
  
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 restrictions and conditions apply
only to the Subsidiary that is to be sold and such sale is permitted under this Agreement.
 SECTION
10.12         NATURE OF BUSINESS. Alter in any material respect the character or conduct of the business conducted by the U.S. Borrower and its Subsidiaries as of the Closing Date.
 SECTION 10.13         IMPAIRMENT OF SECURITY INTERESTS. Take or omit to take any action, which might or
would have the result of materially impairing the security interests in favor of the Administrative Agent with respect to the Collateral or grant to any Person (other than the Administrative Agent or the U.S. Administrative Agent, in each case, for
the benefit of the Secured Parties, pursuant to the Security Documents) any interest whatsoever in the Collateral, except for Permitted Liens and Asset Dispositions permitted under Section 10.5.
 SECTION 10.14           MAXIMUM CASH BALANCES. (A) PERMIT THE AGGREGATE
AMOUNT OF CASH AND CASH EQUIVALENTS OF THE U.S. BORROWER AND ITS SUBSIDIARIES (OTHER THAN CASH AND CASH EQUIVALENTS ERRONEOUSLY CREDITED TO ANY DEPOSIT, SECURITIES OR OTHER INVESTMENT ACCOUNT OF THE BORROWER AND ITS SUBSIDIARIES SO LONG AS SUCH
AMOUNT IS REMOVED FROM SUCH ACCOUNT WITHIN TWO (2) BUSINESS DAYS AFTER ITS DEPOSIT THEREIN) TO EXCEED $70,000,000 AS OF THE END OF ANY BUSINESS DAY FOR MORE THAN TWO (2) BUSINESS DAYS AND (B) PERMIT THE AGGREGATE AMOUNT ON DEPOSIT AT ANY TIME IN ALL
EXCLUDED ACCOUNTS TO EXCEED $500,000.
 ARTICLE XI
  
 UNCONDITIONAL U.S. BORROWER GUARANTY
 SECTION
11.1           GUARANTY OF OBLIGATIONS. The U.S. Borrower hereby unconditionally guarantees to the Administrative Agent for the ratable benefit of the Administrative Agent and the Secured
Parties, and their respective successors, endorsees, transferees and assigns, the prompt payment of all Obligations of the Borrower, whether primary or secondary (whether by way of endorsement or otherwise), whether now existing or hereafter
arising, whether or not from time to time reduced or extinguished (except by payment thereof) or hereafter increased or incurred, whether or not recovery may be or hereafter become barred by the statute of limitations, whether enforceable or
unenforceable as against the Borrower, whether or not discharged, stayed or otherwise affected by any Applicable Insolvency Law or proceeding thereunder, whether created directly with the Administrative Agent or any other Secured Party or acquired
by the Administrative Agent or any other Secured Party through assignment, endorsement or otherwise, whether matured or unmatured, whether joint or several, as and when the same become due and payable (whether at maturity or earlier, by reason of
acceleration, mandatory repayment or otherwise), in accordance with the terms of any such instruments evidencing any such obligations, including all renewals, extensions or modifications thereof (all Obligations of the Borrower, including all of the
foregoing, being hereinafter collectively referred to as the "Bowater Guaranteed Obligations").
  
  
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	 Section 11.2

	 Nature of
Guaranty.

 (a)       The U.S. Borrower agrees that this U.S. Borrower
Guaranty is a continuing, unconditional guaranty of payment and performance and not of collection, and that its obligations under this U.S. Borrower Guaranty shall be primary, absolute and unconditional, irrespective of, and unaffected
by:
 (i)        the genuineness, validity, regularity, enforceability or any
future amendment of, or change in, this Agreement or any other Loan Document or any other agreement, document or instrument to which the U.S. Borrower, the Borrower or any of their respective Subsidiaries or Affiliates is or may become a
party;
 (ii)       the absence of any action to enforce this U.S. Borrower
Guaranty, this Agreement, any other Loan Document or any Hedging Agreement, or the waiver or consent by the Administrative Agent or any other Secured Party with respect to any of the provisions of this U.S. Borrower Guaranty, this Agreement, any
other Loan Document or any Hedging Agreement;
 (iii)      the existence, value or
condition of, or failure to perfect its Lien against, any security for or other guaranty of the Bowater Guaranteed Obligations or any action, or the absence of any action, by the Administrative Agent or any other Secured Party in respect of such
security or guaranty (including, without limitation, the release of any such security or guaranty);
 (iv)      any structural change in, restructuring of or other similar change of the U.S. Borrower, the Borrower or any of their respective Subsidiaries; or
 (v)       any other action or circumstances which might otherwise constitute a legal or
equitable discharge or defense of a surety or guarantor;
 it being agreed by the U.S. Borrower that its obligations under this U.S. Borrower Guaranty shall
not be discharged except as under the terms of Section 11.6 below.
 (b)       The U.S. Borrower
represents, warrants and agrees that the Bowater Guaranteed Obligations and its obligations under this U.S. Borrower Guaranty are not and shall not be subject to any counterclaims, offsets or defenses of any kind (other than the defense of payment)
against the Administrative Agent, the Secured Parties or the Borrower whether now existing or which may arise in the future.
 (c)       The U.S. Borrower hereby agrees and acknowledges that the Bowater Guaranteed Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed,
extended, amended or waived, in reliance upon this U.S. Borrower Guaranty, and all dealings between the Borrower and the U.S. Borrower, on the one hand, and the Administrative Agent and any other Secured Party, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon this U.S. Borrower Guaranty.
  
  
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 SECTION 11.3           WAIVERS. To the extent permitted by Applicable Law, the U.S. Borrower
expressly waives the benefit of all provisions of Applicable Law which are or might be in conflict with this U.S. Borrower Guaranty and all of the following rights and defenses (and agrees not to take advantage of or assert any such right or
defense):
 (a)       any rights it may now or in the future have under any statute, or at law or in
equity, or otherwise, to compel the Administrative Agent or any other Secured Party to proceed in respect of the Bowater Guaranteed Obligations against the Borrower or any other Person or against any security for or other guaranty of the payment and
performance of the Bowater Guaranteed Obligations before proceeding against, or as a condition to proceeding against, the U.S. Borrower;
 (b)       any defense based upon the failure of the Administrative Agent or any other Secured Party to commence an action in respect of the Bowater Guaranteed Obligations against the Borrower, the U.S.
Borrower, any other guarantor or any other Person or any security for the payment and performance of the Bowater Guaranteed Obligations;
 (c)       any right to insist upon, plead or in any manner whatever claim or take the benefit or advantage of, any appraisal, valuation, stay, extension, marshalling of assets or redemption laws, or
exemption, whether now or at any time hereafter in force, which may delay, prevent or otherwise affect the performance by the U.S. Borrower of its obligations under, or the enforcement by the Administrative Agent or the other Secured Parties of,
this U.S. Borrower Guaranty;
 (d)       any right of diligence, presentment, demand, protest and
notice (except as specifically required herein) of whatever kind or nature with respect to any of the Bowater Guaranteed Obligations and waives, to the fullest extent permitted by Applicable Laws, the benefit of all provisions of Applicable Law
which are or might be in conflict with the terms of this U.S. Borrower Guaranty; and
 (e)       any
and all right to notice of the creation, renewal, extension or accrual of any of the Bowater Guaranteed Obligations and notice of or proof of reliance by the Administrative Agent or any other Secured Party upon, or acceptance of, this U.S. Borrower
Guaranty.
 The U.S. Borrower agrees that any notice or directive given at any time to the Administrative Agent or any other Secured Party
which is inconsistent with any of the foregoing waivers shall be null and void and may be ignored by the Administrative Agent or such other Secured Party, and, in addition, may not be pleaded or introduced as evidence in any litigation relating to
this U.S. Borrower Guaranty for the reason that such pleading or introduction would be at variance with the written terms of this U.S. Borrower Guaranty, unless the Administrative Agent and the Required Agreement Lenders have specifically agreed
otherwise in writing. The foregoing waivers are of the essence of the transaction contemplated by this Agreement and the other Loan Documents and, but for this U.S. Borrower Guaranty and such waivers, the Administrative Agent and other Secured
Parties would decline to enter into this Agreement and the other Loan Documents.
  
  
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 SECTION 11.4           MODIFICATION OF LOAN DOCUMENTS, ETC. Neither the Administrative Agent
nor any other Secured Party shall incur any liability to the U.S. Borrower as a result of any of the following, and none of the following shall impair or release this U.S. Borrower Guaranty or any of the obligations of the U.S. Borrower under this
U.S. Borrower Guaranty:
 (a)       any change or extension of the manner, place or terms of payment
of, or renewal or alteration of all or any portion of, the Bowater Guaranteed Obligations;
 (b)       any action under or in respect of this Agreement or the other Loan Documents in the exercise of any remedy, power or privilege contained therein or available to any of them at law, in equity or
otherwise, or waiver or refraining from exercising any such remedies, powers or privileges;
 (c)       any amendment to, or modification of, in any manner whatsoever, the Loan Documents;
 (d)       any extension or waiver of the time for performance by the U.S. Borrower, any other guarantor, the Borrower or any other Person of, or compliance with, any term, covenant or agreement on its part
to be performed or observed under a Loan Document, or waiver of such performance or compliance or consent to a failure of, or departure from, such performance or compliance;
 (e)       the taking and holding of security or collateral for the payment of the Bowater Guaranteed Obligations or
the sale, exchange, release, disposal of, or other dealing with, any property pledged, mortgaged or conveyed, or in which the Administrative Agent or the other Secured Parties have been granted a Lien, to secure any Indebtedness of the U.S.
Borrower, any other guarantor or the Borrower to the Administrative Agent or the other Secured Parties;
 (f)        the release of anyone who may be liable in any manner for the payment of any amounts owed by the U.S. Borrower, any other guarantor or the Borrower to the Administrative Agent or any other
Secured Party;
 (g)       any modification or termination of the terms of any intercreditor or
subordination agreement pursuant to which claims of other creditors of the U.S. Borrower, any other guarantor or the Borrower are subordinated to the claims of the Administrative Agent or any other Secured Party; or
 (h)       any application of any sums by whomever paid or however realized to any Bowater Guaranteed Obligations
owing by the U.S. Borrower, any other guarantor or the Borrower to the Administrative Agent or any other Secured Party in such manner as the Administrative Agent or any other Secured Party shall determine in its reasonable discretion.
 SECTION 11.5           DEMAND BY THE ADMINISTRATIVE AGENT. In addition to the terms set forth
in this Article XI and in no manner imposing any limitation on such terms, if all or any portion of the then outstanding Bowater Guaranteed Obligations are declared to be immediately due and payable, then the U.S. Borrower shall, upon demand in
writing therefor by
  
  
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 the Administrative Agent to the
U.S. Borrower, pay all or such portion of the outstanding Bowater Guaranteed Obligations due hereunder then declared due and payable.
 
	  
	 Section 11.6

	 Termination; Reinstatement.

 (a)       Subject
to clause (c) below, this U.S. Borrower Guaranty shall remain in full force and effect until all the Bowater Guaranteed Obligations and all the obligations of the U.S. Borrower under this U.S. Borrower Guaranty shall have been paid in full and the
Commitments terminated.
 (b)       No payment made by the Borrower, the U.S. Borrower or any other
Person received or collected by the Administrative Agent or any other Secured Party from the Borrower, the U.S. Borrower or any other Person by virtue of any action or proceeding or any setoff or appropriation or application at any time or from time
to time in reduction of or in payment of the Bowater Guaranteed Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of the U.S. Borrower hereunder which shall, notwithstanding any such payment (other than any
payment made by the U.S. Borrower in respect of the obligations of the U.S. Borrower or any payment received or collected from the U.S. Borrower in respect of the obligations of the U.S. Borrower), remain liable for the obligations of the U.S.
Borrower up to the maximum liability of the U.S. Borrower hereunder until the Bowater Guaranteed Obligations and all the obligations of the U.S. Borrower shall have been paid in full and the Commitments terminated.
 (c)       The U.S. Borrower agrees that, if any payment made by the Borrower or any other Person applied to the
Bowater Guaranteed Obligations is at any time annulled, set aside, rescinded, invalidated, declared to be fraudulent or preferential or otherwise required to be refunded or repaid, or is repaid in whole or in part pursuant to a good faith settlement
of a pending or threatened claim, or the proceeds of any Collateral are required to be refunded by the Administrative Agent or any other Secured Party to the Borrower, its estate, trustee, receiver or any other Person, including, without limitation,
the U.S. Borrower, under any Applicable Law or equitable cause, then, to the extent of such payment or repayment, the U.S. Borrower's liability hereunder shall be and remain in full force and effect, as fully as if such payment had never been made,
and, if prior thereto, this U.S. Borrower Guaranty shall have been canceled or surrendered, this U.S. Borrower Guaranty shall be reinstated in full force and effect, and such prior cancellation or surrender shall not diminish, release, discharge,
impair or otherwise affect the obligations of the U.S. Borrower in respect of the amount of such payment.
 SECTION
11.7           NO SUBROGATION. Notwithstanding any payment or payments by the U.S. Borrower hereunder, or any setoff or application of funds of the U.S. Borrower by the Administrative Agent or
any other Secured Party, or the receipt of any amounts by the Administrative Agent or any other Secured Party with respect to any of the Bowater Guaranteed Obligations, the U.S. Borrower shall not be entitled to be subrogated to any of the rights of
the Administrative Agent or any other Secured Party against the Borrower, the other Subsidiary Guarantors or any other guarantor or against any collateral security held by the Administrative Agent or any other Secured Party for the payment of the
Bowater Guaranteed Obligations nor shall the U.S. Borrower seek any reimbursement from the Borrower, any of the other Subsidiary Guarantors or any of the other guarantors in respect of payments made by the U.S. Borrower in
  

  
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 connection with the Bowater Guaranteed Obligations, until all amounts owing to the Administrative Agent and the other Secured Parties on account of the Bowater Guaranteed
Obligations are paid in full and the Commitments are terminated. If any amount shall be paid to the U.S. Borrower on account of such subrogation rights at any time when all of the Bowater Guaranteed Obligations shall not have been paid in full or
the Commitments have not been terminated, such amount shall be held by the U.S. Borrower in trust for the Administrative Agent, segregated from other funds of the U.S. Borrower, and shall, forthwith upon receipt by the U.S. Borrower, be turned over
to the Administrative Agent in the exact form received by the U.S. Borrower (duly endorsed by the U.S. Borrower to the Administrative Agent, if required) to be applied against the Bowater Guaranteed Obligations, whether matured or unmatured, in such
order as set forth in this Agreement.
 SECTION 11.8           PAYMENTS. Payments
by the U.S. Borrower shall be made to the Administrative Agent, to be credited and applied to the Bowater Guaranteed Obligations in accordance with Section 12.4 of this Agreement, in immediately available Dollars or Canadian Dollars, as designated
by the Administrative Agent, to an account designated by the Administrative Agent or at the Administrative Agent's Office or at any other address that may be specified in writing from time to time by the Administrative Agent. Any and all payments by
or on account of any obligation of the U.S. Borrower under this U.S. Borrower Guaranty shall be made free and clear of and without reduction or withholding for any taxes.
 SECTION 11.9     NATURE OF OBLIGATIONS; BANKRUPTCY LIMITATIONS; AGREEMENT FOR CONTRIBUTION
 (a)       Nature of Obligations. All of the U.S. Borrowers shall be
jointly and severally liable for the Bowater Guaranteed Obligations, however incurred.
 (b)       
Bankruptcy Limitations. Notwithstanding anything to the contrary contained in this Agreement, it is the intention of each U.S. Borrower, the Administrative Agent and the Lenders that, in any proceeding
involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to any U.S. Borrower or its assets, the amount of such U.S. Borrower's obligations with
respect to the Bowater Guaranteed Obligations shall be equal to, but not in excess of, the maximum amount thereof not subject to avoidance or recovery by operation of Applicable Insolvency Laws after giving effect to Section 11.9(c). To that end,
but only in the event and to the extent that after giving effect to Section 11.9(c), such U.S. Borrower's obligations with respect to the Bowater Guaranteed Obligations or any payment made pursuant to such Bowater Guaranteed Obligations would, but
for the operation of the first sentence of this Section 11.9(b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to Section 11.9(c), the amount of such U.S. Borrower's obligations with
respect to the Bowater Guaranteed Obligations shall be limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render such U.S. Borrower's obligations with respect to the Bowater Guaranteed
Obligations unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made pursuant to the Bowater Guaranteed Obligations exceeds the limitation of the first sentence of this
Section 11.9(b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance shall in
  

  
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 all events be limited to the amount by which such actual payment exceeds such limitation and the Bowater Guaranteed Obligations as limited by the first sentence of this
Section 11.9(b) shall in all events remain in full force and effect and be fully enforceable against such U.S. Borrower. The first sentence of this Section 11.9(b) is intended solely to preserve the rights of the Administrative Agent and the Lenders
hereunder against such U.S. Borrower in such proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither such U.S. Borrower, any other U.S. Borrower, any Guarantor nor any other Person shall have any right or claim under
such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding.
 (c)       Agreement for Contribution. The U.S. Borrowers hereby agree among themselves that, if any U.S. Borrower shall make an Excess Payment (as defined
below), such U.S. Borrower shall have a right of contribution from each other U.S. Borrower in an amount equal to such other U.S. Borrower's Contribution Share (as defined below) of such Excess Payment. The payment obligations of any U.S. Borrower
under this Section 11.9(c) shall be subordinate and subject in right of payment to the Bowater Guaranteed Obligations until such time as the Bowater Guaranteed Obligations have been paid in full, and none of the U.S. Borrowers shall exercise any
right or remedy under this Section 11.9(c) against any other U.S. Borrower until such Bowater Guaranteed Obligations have been paid in full. For purposes of this Section 11.9(c):
 (1)       "Excess Payment" shall mean the amount
paid by any U.S. Borrower in excess of its Ratable Share of any Bowater Guaranteed Obligations;
 (2)       "Ratable Share" shall mean, for any U.S. Borrower in respect of any payment of Bowater Guaranteed Obligations, the ratio (expressed as a percentage)
as of the date of such payment of Bowater Guaranteed Obligations of (A) the amount by which the aggregate present fair salable value of all of the assets and properties of such U.S. Borrower exceeds the amount of all debts and liabilities of such
U.S. Borrower (including probable contingent, subordinated, unmatured, and unliquidated liabilities, but excluding the obligations of such U.S. Borrower hereunder) to (B) the amount by which the aggregate present fair salable value of all assets and
other properties of all of the U.S. Borrowers exceeds the amount of all of the debts and liabilities (including probable contingent, subordinated, unmatured, and unliquidated liabilities, but excluding the obligations of the U.S. Borrowers
hereunder) of the U.S. Borrowers; provided, however, that, for purposes of calculating the Ratable Shares of the U.S. Borrowers in respect of any payment
of the Bowater Guaranteed Obligations, any U.S. Borrower that became a U.S. Borrower subsequent to the date of any such payment shall be deemed to have been a U.S. Borrower on the date of such payment and the financial information for such U.S.
Borrower as of the date such U.S. Borrower became a U.S. Borrower shall be utilized for such U.S. Borrower in connection with such payment; and
 (3)       "Contribution Share" shall mean, for
any U.S. Borrower in respect of any Excess Payment made by any other U.S. Borrower, the ratio (expressed as a percentage) as of the date of such Excess Payment of (A) the amount by which the aggregate present fair salable value of all of the assets
and properties of such U.S. Borrower exceeds the amount of all debts and liabilities of such U.S. Borrower (including probable contingent,
  

 
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 subordinated, unmatured, and unliquidated liabilities, but excluding the obligations of such U.S. Borrower hereunder) to (B) the amount by which
the aggregate present fair salable value of all assets and other properties of the U.S. Borrowers other than the maker of such Excess Payment exceeds the amount of all of the debts and liabilities (including probable contingent, subordinated,
unmatured, and unliquidated liabilities, but excluding the obligations of the U.S. Borrowers) of the U.S. Borrowers other than the maker of such Excess Payment; provided, however
, that, for purposes of calculating the Contribution Shares of the U.S. Borrowers in respect of any Excess Payment, any U.S. Borrower that became a U.S. Borrower subsequent to the date of any such Excess Payment shall be
deemed to have been a U.S. Borrower on the date of such Excess Payment and the financial information for such U.S. Borrower as of the date such U.S. Borrower became a U.S. Borrower shall be utilized for such U.S. Borrower in connection with such
Excess Payment.
 Each of the U.S. Borrowers recognizes and acknowledges that the rights to contribution arising hereunder shall constitute an asset in favor
of the party entitled to such contribution. No U.S. Borrower shall have any right of subrogation, indemnity or reimbursement under Applicable Law in respect of any payment of Bowater Guaranteed Obligations (other than the contribution rights set
forth in this Section 11.9(c)) against any other U.S. Borrower.
 For purposes of this Section, the term "U.S. Borrowers" means the
collective reference to the Original U.S. Borrower and the New U.S. Borrowers and "U.S. Borrower" means the Original U.S. Borrower or one of the New U.S. Borrowers, as applicable.
  
 ARTICLE XII
  
 DEFAULT AND REMEDIES
 SECTION 12.1           EVENTS OF DEFAULT. Each of the following shall constitute an Event of
Default, whatever the reason for such event and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment or order of any court or any order, rule or regulation of any Governmental Authority or
otherwise:
 (a)       Default in Payment of Principal of Loans and
Reimbursement Obligations. The Borrower or any other Credit Party shall default in any payment of principal of any Loan or Reimbursement Obligation when and as due (whether at maturity, by reason of acceleration or
otherwise).
 (b)       Other Payment Default. The
Borrower or any other Credit Party shall default in the payment when and as due (whether at maturity, by reason of acceleration or otherwise) of interest on any Loan or Reimbursement Obligation or the payment of any other Obligation, and such
default shall continue for a period of three (3) or more Business Days.
 (c)       Misrepresentation. Any representation, warranty, certification or statement of fact made or deemed made by or on behalf of the U.S. Borrower, the Borrower or any other Credit Party herein, in any other Loan Document,
or in any document delivered in connection herewith
  
  
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 or therewith that is subject to
materiality or Material Adverse Effect qualifications, shall be incorrect or misleading in any respect when made or deemed made or any representation, warranty, certification or statement of fact made or deemed made by or on behalf of the U.S.
Borrower, the Borrower or any other Credit Party herein, any other Loan Document, or in any document delivered in connection herewith or therewith that is not subject to materiality or Material Adverse Effect qualifications, shall be incorrect or
misleading in any material respect when made or deemed made.
 (d)       Default
in Performance of Certain Covenants. The U.S. Borrower, the Borrower or any other Credit Party shall default in the performance or observance of any covenant or agreement contained in Section 5.4,7.1
 (other than Section 7.1(g)), Section 7.2, Section 7.5(e)(i), 8.2(b), Section
8.10(e)(i), Section 8.10(e)(ii), 8.10(f), 8.10(g) or Article
IX or Article X.
 (e)       Default in Performance of Other Covenants and
Conditions. The U.S. Borrower, the Borrower or any other Credit Party shall default in the performance or observance of:
 (i)        Section 7.1(g) of this Agreement
and such default shall continue for a period of two (2) Business Days; and
 (ii)       any other term, covenant, condition or agreement contained in this Agreement (other than as specifically provided for otherwise in this Section) or any other Loan Document and such default shall
continue for a period of thirty (30) days after written notice thereof has been given to the Borrower by the Administrative Agent.
 (f)        Hedging Agreement. The U.S. Borrower, the Borrower or any other Credit Party shall default in the performance or observance of any terms,
covenant, condition or agreement (after giving effect to any applicable grace or cure period) under any Hedging Agreement and such default causes the termination of such Hedging Agreement and the Termination Value owed by the U.S. Borrower, the
Borrower or such other Credit Party as a result thereof exceeds $25,000,000.
 
	  
	 (g)
	 Indebtedness Cross-Default.

 (i)        Any "Event of Default" (as defined in the U.S. Credit Agreement) shall occur under the U.S. Credit Agreement.
 (ii)       Any default shall occur in the payment of any Indebtedness of the U.S. Borrower or
any of its Subsidiaries (other than the Loans, any Reimbursement Obligation or the U.S. Credit Facility) the aggregate outstanding amount of which Indebtedness is in excess of $25,000,000 beyond the period of grace, if any, provided in the
instrument or agreement under which such Indebtedness was created.
 (iii)      Any
default in the observance or performance of any other agreement or condition relating to any Indebtedness of the U.S. Borrower or any of its Subsidiaries (other than the Loans, any Reimbursement Obligation or the U.S. Credit Facility) the aggregate
outstanding amount of which Indebtedness is in excess of $25,000,000 or contained in any instrument or agreement evidencing, securing or relating thereto or any other event shall occur or condition exist, the effect of which default or other event
or
  
  
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 condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, with the giving of notice if required, any such Indebtedness to become due prior to its stated maturity (any
applicable grace period having expired).
 (iv)      Any payment default or any other
event of default or any other similar event, including any change in control, shall occur under any agreement executed in connection with the April 2008 Convertible Indebtedness.
 
	  
	 (h)
	 Change in
Control. Any Change in Control shall occur.

 (i)        Voluntary Bankruptcy Proceeding. The U.S. Borrower or any of its Subsidiaries shall (i) commence a voluntary case under the federal bankruptcy
laws (as now or hereafter in effect), (ii) file a petition seeking to take advantage of any other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding up or composition for adjustment of debts, (iii) consent to or
fail to contest in a timely and appropriate manner any petition filed against it in an involuntary case under such bankruptcy laws or other laws, (iv) apply for or consent to, or fail to contest in a timely and appropriate manner, the appointment
of, or the taking of possession by, a receiver, custodian, trustee, or liquidator of itself or of a substantial part of its property, domestic or foreign, (v) admit in writing its inability to pay its debts as they become due, (vi) make a general
assignment for the benefit of creditors, or (vii) take any corporate action for the purpose of authorizing any of the foregoing.
 (j)        Involuntary Bankruptcy Proceeding. A case or other proceeding shall be commenced against the U.S. Borrower or any of its Subsidiaries in any
court of competent jurisdiction seeking (i) relief under the federal bankruptcy laws (as now or hereafter in effect) or under any other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding up or adjustment of debts,
or (ii) the appointment of a trustee, receiver, custodian, liquidator or the like for the U.S. Borrower or any of its Subsidiaries or for all or any substantial part of their respective assets, domestic or foreign, and such case or proceeding shall
continue without dismissal or stay for a period of sixty (60) consecutive days, or an order granting the relief requested in such case or proceeding (including, but not limited to, an order for relief under such federal bankruptcy laws) shall be
entered.
 (k)       Failure of Agreements. (i) Any
provision of this Agreement or any provision of any other Loan Document shall for any reason cease to be valid and binding on the Borrower or any other Credit Party party thereto or any such Person shall so state in writing, (ii) any Loan Document
shall for any reason cease to create a valid and perfected first priority Lien on, or security interest in, any of the Collateral securing the Obligations purported to be covered thereby or (iii) any subordination provision in any document or
instrument governing any Subordinated Indebtedness, any subordination provision in any subordination agreement that relates to any Subordinated Indebtedness or any subordination provision in any guaranty by any U.S. Credit Party of any Subordinated
Indebtedness shall, in any case, cease to be in full force and effect, or any Person shall contest in any manner the validity, binding nature or enforceability of any such provision, in each of the foregoing clauses (i), (ii) and (iii), other than
in accordance with the express terms hereof or thereof.
  
  

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 (l)        Termination Event. The occurrence of any of the following events: (i) the U.S. Borrower or any of its Subsidiaries or any of their ERISA
Affiliates fails to make full payment when due of all amounts which, under the provisions of any Pension Plan or Section 412 of the Code, the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates is required to pay as
contributions thereto, (ii) the U.S. Borrower or any of its Subsidiaries fails to make full payment when due of all amounts which, under the provisions of any Canadian Pension Plan or other Applicable Law, the U.S. Borrower or any of its
Subsidiaries is required to pay as contributions thereto, (iii) an accumulated funding deficiency in excess of $25,000,000 occurs or exists, whether or not waived, with respect to any Pension Plan or Canadian Pension Plan, (iv) a Termination Event,
(v) the U.S. Borrower or any of its Subsidiaries or any of their ERISA Affiliates as employers under one or more Multiemployer Plans makes a complete or partial withdrawal from any such Multiemployer Plan and the plan sponsor of such Multiemployer
Plan notifies such withdrawing employer that such employer has incurred a withdrawal liability requiring payments in an amount exceeding $25,000,000 or (vi) the U.S. Borrower or any of its Subsidiaries as employers under one or more Canadian
Multiemployer Plans makes a complete or partial withdrawal from any such Canadian Multiemployer Plan and the plan sponsor of such Canadian Multiemployer Plans notifies such withdrawing employer that such employer has incurred a withdrawal liability
requiring payments in an amount exceeding $25,000,000.
 (m)      Judgment. A judgment or order for the payment of money which causes the aggregate amount of all such judgments or orders to exceed (i) $10,000,000 in the aggregate (to the extent not covered by independent third-party
insurance as to which the insurer does not dispute coverage) or (ii) $50,000,000in the aggregate (regardless of insurance)shall be entered against the U.S. Borrower or any of its Subsidiaries by any court and such judgment or order shall continue
without having been paid and satisfied, discharged, vacated or stayed for a period of thirty (30) days after the entry thereof.
 (n)       Environmental. Any one or more Environmental Claims shall have been asserted against the U.S. Borrower or any of its Subsidiaries; the U.S. Borrower
or any of its Subsidiaries would be reasonable likely to incur liability as a result thereof; and such liability would be reasonably likely, individually or in the aggregate, to have a Material Adverse Effect.
 (o)       Activities of Parent. The Parent shall engage in any
business, operations or activities other than:
 (i)        (A) holding all of
the Capital Stock of the Original U.S. Borrower, each New U.S. Borrower, the Donohue Corp., a Delaware corporation (or an intermediate holding company that owns the Capital Stock of the Donahue Corp.) and Abitibi-Consolidated Inc. or any of its
subsidiaries, (B) holding certain preferred Capital Stock of Bowater Canadian Holdings Incorporated, a company organized under the laws of Nova Scotia, so long as promptly upon receipt thereof, the Parent either (1) distributes such Capital Stock to
the Original U.S. Borrower, (2) distributes such Capital Stock to another U.S. Credit Party or (3) pledges such Capital Stock as collateral support for the U.S. Obligations in accordance with the U.S. Collateral Agreement, (C) the employment of
management and (D) activities reasonably complimentary and related to the foregoing (including, without limitation, investments in the U.S. Borrower);
  
  
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 (ii)       guaranteeing the U.S. Obligations in favor of the U.S. Administrative Agent, for the
ratable benefit of the U.S. Secured Parties, pursuant to the U.S. Parent Guaranty Agreement;
 
	  
	 (iii)
	 [Intentionally Omitted];

 (iv)      granting a security
interest in its assets and properties (other than (A) the Capital Stock of the U.S. Borrower or (B) in connection with the Indebtedness permitted pursuant to the following clause (viii)); provided that
(x) the U.S. Administrative Agent is given a Lien on such assets and properties that is prior to such other Lien or (y) to the extent that a Lien is granted in the stock of Abitibi-Consolidated Inc., then the U.S. Administrative Agent shall be
granted a Lien in the stock of the Original U.S. Borrower;
 (v)       granting a
security interest in the Capital Stock of the U.S. Borrower in favor of the U.S. Administrative Agent, for the ratable benefit of the U.S. Secured Parties, to secure the U.S. Obligations;
 (vi)      engaging in non-revenue generating activities reasonably related to restructuring of the
Subsidiaries of the Parent; provided, that in the case of any restructuring involving the Credit Parties or the U.S. Credit Parties, the Administrative Agent and the U.S. Administrative Agent shall have
received (A) an organizational chart of the Parent and its Subsidiaries after giving effect thereto and (B) a final summary of the steps involved in any such restructuring;
 (vii)     guaranteeing obligations of Subsidiaries of the Parent or of the Abitibi Entities to the extent
that such obligations are unsecured, relate to indemnification obligations with respect to asset sales or trade obligations incurred in the ordinary course of business and do not constitute Indebtedness of such Subsidiary or of such Abitibi Entity;
and
 (viii)    to the extent not otherwise permitted hereunder, incurring unsecured Indebtedness;
 provided, that:
 (A)      the
Administrative Agent and the U.S. Administrative Agent shall have received reasonably satisfactory written evidence that the U.S. Borrower and its Subsidiaries would be in compliance with the covenants set forth in Article IX and Section 12.1(o)(ix)
on a pro forma basis after giving effect to such Indebtedness;
 (B)      no Default or Event of Default shall have occurred and be continuing or would be caused by
the issuance of such Indebtedness;
 (C)       no portion of such Indebtedness of the
Parent may be recourse to any Credit Party or any U.S. Credit Party (except to the extent permitted pursuant to Section 10.1(d) or (f)(ii)) (it being understood and agreed that no Credit Party or U.S.
Credit Party (except to the extent permitted pursuant to Section 10.1(d) or (f)(ii) shall have any obligation whatsoever to repay such Indebtedness or any other obligation related thereto);

 

  
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 (D)      no such Indebtedness shall have a maturity date that is earlier than the ninety-first
(91st) day after the Maturity Date;
 (E)       the Parent may not cancel,
forgive or make any payment (other than regularly scheduled interest payments) or prepayments on, or redeem or acquire for value (including, without limitation, by way of depositing with any trustee with respect thereto money or securities before
due for the purpose of paying when due, but excluding payments at the scheduled maturity thereof) any such Indebtedness; provided, that the Parent may pay a cash settlement of any convertible
Indebtedness so long as on the date of any such payment and after giving effect thereto:
 (2)       no Default or Event of Default shall have occurred and be continuing;
 (3)       the U.S. Borrower shall be in pro forma compliance with each of the covenants set forth in Article IX;
 (4)       the Aggregate Credit Exposure shall not exceed $100,000,000;
 (5)       the pro forma Consolidated Total Leverage Ratio shall not exceed 4.50 to 1.00; and

 (F)       except to the extent such Indebtedness is guaranteed by a U.S. Credit
Party pursuant to Section 10.1(d), the proceeds of such Indebtedness are used solely for working capital and general corporate purposes of, or to repay outstanding Indebtedness of, the Parent and its Subsidiaries or any Abitibi Entity;
 (ix)      holding a cash balance in the deposit, securities and other investment accounts of the
Parent as of the end of any Business Day in excess of $25,000,000, unless the amount of such balance that is in excess of $25,000,000 is as promptly as possible, but in no event later than one (1) Business Day, invested in the U.S. Borrower;
provided, that notwithstanding this Section 12.1(o)(ix)), the Parent may retain the proceeds of the April 2008 Convertible Indebtedness until no later than April
15, 2008; and
 (x)       to the extent not otherwise permitted hereunder, incurring
Indebtedness payable to the Original U.S. Borrower pursuant to the New U.S. Borrower Notes.
 (p)       Permitted Secured Indebtedness. The Permitted Secured Indebtedness is less than or equal to C$58,000,000.
 SECTION 12.2           REMEDIES. Except as otherwise expressly provided in any other Loan
Document, upon the occurrence of an Event of Default, with the consent of the Required Agreement Lenders, the Administrative Agent may, or upon the request of the Required Agreement Lenders, the Administrative Agent shall, by notice to the Borrower:

  
  
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 (a)       Acceleration; Termination of Facilities. Terminate the Commitment and declare the principal of and interest on the Loans and the Reimbursement
Obligations at the time outstanding, and all other amounts owed to the Lenders and to the Administrative Agent under this Agreement or any of the other Loan Documents (including, without limitation, all L/C Obligations, whether or not the
beneficiaries of the then outstanding Letters of Credit shall have presented or shall be entitled to present the documents required thereunder) and all other Obligations (other than Hedging Obligations and Obligations owing by the Credit Parties
(other than the U.S. Borrower) under any Cash Management Arrangement), to be forthwith due and payable, whereupon the same shall immediately become due and payable without presentment, demand, protest or other notice of any kind, all of which are
expressly waived by each Credit Party, anything in this Agreement or the other Loan Documents to the contrary notwithstanding, and terminate the Credit Facility and any right of the Borrower to request borrowings or Letters of Credit thereunder;
 provided, that upon the occurrence of an Event of Default specified in Section 12.1(i)or (j), the Credit Facility shall be automatically terminated and all Obligations (other than Hedging Obligations
and Obligations owing by Credit Parties (other than the U.S. Borrower) under any Cash Management Arrangement) shall automatically become due and payable without presentment, demand, protest or other notice of any kind, all of which are expressly
waived by each Credit Party, anything in this Agreement or in any other Loan Document to the contrary notwithstanding.
 (b)       Letters of Credit. With respect to all Letters of Credit with respect to which presentment for honor shall not have occurred at the time of an
acceleration pursuant to the preceding paragraph, the Borrower shall at such time deposit in a cash collateral account opened by the Administrative Agent an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit.
Amounts held in such cash collateral account shall be applied by the Administrative Agent to the payment of drafts drawn under such Letters of Credit, and the unused portion thereof after all such Letters of Credit shall have expired or been fully
drawn upon, if any, shall be applied to repay the other Obligations on a pro rata basis. After all such Letters of Credit shall have expired or been fully drawn upon, the Reimbursement Obligation shall
have been satisfied and all other Obligations shall have been paid in full, the balance, if any, in such cash collateral account shall be returned to the Borrower.
 (c)       Rights of Collection. Exercise on behalf of the Lenders
all of its other rights and remedies under this Agreement, the other Loan Documents and Applicable Law, in order to satisfy all of the Borrower's Obligations.
 SECTION 12.3           RIGHTS AND REMEDIES CUMULATIVE; NON-WAIVER; ETC. The enumeration of the
rights and remedies of the Administrative Agent and the Lenders set forth in this Agreement is not intended to be exhaustive and the exercise by the Administrative Agent and the Lenders of any right or remedy shall not preclude the exercise of any
other rights or remedies, all of which shall be cumulative, and shall be in addition to any other right or remedy given hereunder or under the other Loan Documents or that may now or hereafter exist at law or in equity or by suit or otherwise. No
delay or failure to take action on the part of the Administrative Agent or any Lender in exercising any right, power or privilege shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or privilege
preclude any other or further exercise thereof or the exercise of any other right, power or privilege or shall be construed to be a waiver of any Event of Default. No course of
  

  
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 dealing between the Borrower, the U.S. Borrower, the Administrative Agent and the Lenders or their respective agents or employees shall be effective to change, modify or
discharge any provision of this Agreement or any of the other Loan Documents or to constitute a waiver of any Event of Default.
 SECTION
12.4           CREDITING OF PAYMENTS AND PROCEEDS.(a)           In the event that the Borrower shall fail to pay any of the Obligations
when due or the Obligations have been accelerated pursuant to Section 12.2, all payments received by the Lenders upon the Obligations and all net proceeds from the enforcement of the Obligations shall be applied:
 First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts, including
attorney fees, payable to the Administrative Agent in its capacity as such and each Issuing Lender in its capacity as such (ratably among the Administrative Agent and each Issuing Lender in proportion to the respective amounts described in this
clause First payable to them);
 Second, to payment of that
portion of the Obligations constituting fees, indemnities, expenses and other amounts (other than principal and interest) payable to the Lenders, including attorney fees (ratably among the Lenders in proportion to the respective amounts described in
this clause Second payable to them);
 Third, to payment of that
portion of the Obligations constituting accrued and unpaid interest on the Loans (including any interest on Special Agent Advances) and Reimbursement Obligations (including any accrued and unpaid interest thereon) (ratably among the Lenders in
proportion to the respective amounts described in this clause Third payable to them);
 Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Special Agent Advances (ratably among the Lenders in proportion to the respective amounts described in this clause
Fourth held by them);
 Fifth, to payment of that portion of the
Obligations constituting unpaid principal of the Loans (other than the Special Agent Advances) and Reimbursement Obligations (ratably among the Lenders in proportion to the respective amounts described in this clause Fifth
 held by them);
 Sixth, to the Administrative Agent for the account of each Issuing
Lender, to cash collateralize any L/C Obligations then outstanding (ratably among the Issuing Lenders in proportion to the respective amounts described in this clause Sixth payable to them);

Seventh, to the payment of that portion of the Obligations constituting Hedging Obligations (including any termination
payments and any accrued and unpaid interest thereon) and Obligations owing by the Credit Parties under any Cash Management Arrangement (ratably among the Secured Parties providing the Hedging Agreements giving rise to such Hedging Obligations and
the Cash Management Arrangements giving rise to such Obligations thereunder in proportion to the respective amounts described in this clause Seventh payable to them); and
 Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrower or as
otherwise required by Applicable Law.
  
  
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 SECTION
12.5           ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to any Credit Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise:
 (a)       to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect
of the Loans, L/C Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the Administrative Agent under Section 3.3, Section 4.3 and
Section 14.3) allowed in such judicial proceeding; and
 (b)       to collect and receive any monies or
other property payable or deliverable on any such claims and to distribute the same;
 and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative
Agent under Section 3.3, Section 4.3 and Section 14.3.
 Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or
consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim
of any Lender in any such proceeding.
 SECTION 12.6           JUDGMENT CURRENCY. The obligation of the
Borrower to make payments of the principal of and interest on the Notes and the obligation of any such Person to make payments of any other amounts payable hereunder or pursuant to any other Loan Document in the currency specified for such payment
shall not be discharged or satisfied by any tender, or any recovery pursuant to any judgment, which is expressed in or converted into any other currency, except to the extent that such tender or recovery shall result in the actual receipt by each of
the Administrative Agent and Lenders of the full amount of the particular Permitted Currency expressed to be payable pursuant to the applicable Loan Document. The Administrative Agent shall, using all amounts obtained or received from the Borrower
pursuant to any such tender or recovery in payment of principal of and interest on the Obligations, promptly purchase the applicable currency at the most favorable spot exchange rate determined by the Administrative Agent to be available to it. The
obligation of the Borrower to make payments in the applicable currency shall be enforceable as an alternative or additional cause of action solely for the purpose of recovering in the applicable currency the amount, if any, by
  

  
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 which such actual receipt shall fall short of the full amount of the currency expressed to be payable pursuant to the applicable Loan Document.
 ARTICLE XIII
  
 THE ADMINISTRATIVE AGENT
 
	  
	 Section 13.1

	 Appointment
and Authority.

 (a)       Each of the Lenders and each of the Issuing Lenders
hereby irrevocably appoints The Bank of Nova Scotia to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers
as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative Agent, the
Lenders and the Issuing Lenders (and, as applicable, the Documentation Agent), and neither the U.S. Borrower, the Borrower nor any of their respective Subsidiaries shall have rights as a third party beneficiary of any of such provisions.

(b)       Without prejudice to the foregoing, each of the Lenders hereby irrevocably designates and appoints the
Administrative Agent as the person holding the power of attorney (fondé de pouvoir) of the Lenders as contemplated under Article 2692 of the CCQ, to enter into, to take and to hold on their behalf, and for their benefit, any deed of hypothec ("
Deed of Hypothec") to be executed by any of the Credit Parties granting a Lien pursuant to the Applicable Law of the Province of Québec and to exercise such powers and duties which are conferred
thereupon under such deed. Each of the Lenders hereby additionally irrevocably designates and appoints the Administrative Agent as agent, custodian and depository for and on behalf of the Lenders (i) to hold and to be the sole registered holder of
any debenture ("Debenture") issued under the Deed of Hypothec, the whole notwithstanding Section 32 of the Act respecting the Special Powers of Legal Persons (Québec) or any other Applicable Law,
and (ii) to enter into, to take and to hold on their behalf, and for their benefit, a debenture pledge agreement ("Pledge") to be executed by such Credit Party pursuant to the Applicable Law of the
Province of Québec and creating a Lien on the Debenture as security for the payment and performance of, inter alia, the Obligations. In this respect, (A) the Administrative Agent as agent, custodian and depository for and on behalf of the
Lenders, shall keep a record indicating the names and addresses of, and the pro rata portion of the obligations and indebtedness secured by the Pledge owing to each of the
Lenders for and on behalf of whom the Debenture is so held from time to time, and (B) each of the Lenders will be entitled to the benefits of any property or assets charged under the Deed of Hypothec and the Pledge and will participate in the
proceeds of realization of any such property or assets. The Administrative Agent, in such aforesaid capacities shall (x) have the sole and exclusive right and authority to exercise, except as may be otherwise specifically restricted by the terms
hereof, all rights and remedies given to the Administrative Agent with respect to the property or assets charged under the Deed of Hypothec and Pledge, any other Applicable Law or otherwise, and (y) benefit from and be subject to all provisions
hereof with respect to the Administrative Agent mutatis mutandis, including, without limitation, all such provisions with respect to the liability or responsibility to and indemnification by the Lenders and/or the Credit Parties.
  

  
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 SECTION 13.2           RIGHTS AS A LENDER. The Person serving as the Administrative Agent
hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term "Lender" or "Lenders" shall, unless otherwise expressly indicated
or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any
other advisory capacity for and generally engage in any kind of business with the U.S. Borrower, the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account
therefor to the Lenders.
 SECTION 13.3           EXCULPATORY PROVISIONS. The
Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, the Administrative Agent:
 (a)       shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has
occurred and is continuing;
 (b)       shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders or Required
Agreement Lenders, as applicable (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent
shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or Applicable Law; and
 (c)       shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to
disclose, and shall not be liable for the failure to disclose, any information relating to the U.S. Borrower, the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its
Affiliates in any capacity.
 The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request
of the Required Lenders or Required Agreement Lenders, as applicable (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as
provided in Section 12.2 and Section 14.2) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final nonappealable judgment. The Administrative Agent shall be deemed not
to have knowledge of any Default unless and until notice describing such Default is given to the Administrative Agent by the U.S. Borrower, the Borrower, a Lender or an Issuing Lender in accordance with Section 14.1. In the event that the
Administrative Agent receives such a notice, it shall promptly give notice thereof to the Lenders and the Issuing Lenders.
 The Administrative Agent shall
not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement
  

  
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 or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith,
(iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article V or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to
the Administrative Agent.
 SECTION 13.4           RELIANCE BY THE ADMINISTRATIVE AGENT. The
Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or
intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone
and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its
terms must be fulfilled to the satisfaction of a Lender or the applicable Issuing Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender or such Issuing Lender unless the Administrative Agent shall have
received notice to the contrary from such Lender or such Issuing Lender prior to the making of such Loan or the issuance of such Letter of Credit. The Administrative Agent may consult with legal counsel (who may be counsel for the U.S. Borrower or
the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
 SECTION 13.5           DELEGATION OF DUTIES. The Administrative Agent may perform any and all of its duties and
exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and
exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent and the
Consultants, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.
 
	  
	 Section 13.6

	 Resignation
of Administrative Agent.

 (a)       The Administrative Agent may at any time
give notice of its resignation to the Lenders, each Issuing Lender and the Borrower. Upon receipt of any such notice of resignation, the Required Agreement Lenders shall have the right, in consultation with the Borrower, to appoint a successor,
which shall be a bank with an office in Canada, or an Affiliate of any such bank with an office in Canada. If no such successor shall have been so appointed by the Required Agreement Lenders and shall have accepted such appointment within
30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may on behalf of the Lenders and the Issuing Lenders, appoint a successor Administrative Agent meeting the qualifications
set forth above; provided that if the Administrative Agent shall
  
  
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 notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with
such notice and (i) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Administrative Agent on
behalf of any Lender or any Issuing Lender under any of the Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed) and (ii) all
payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and each Issuing Lender directly, until such time as the Required Agreement Lenders appoint a
successor Administrative Agent as provided for above in this paragraph. Upon the acceptance of a successor's appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges
and duties of the retiring (or retired) Administrative Agent, and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as
provided above in this paragraph). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring
Administrative Agent's resignation hereunder and under the other Loan Documents, the provisions of this Article and Section 14.3 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective
Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.
 (b)       Any resignation by The Bank of Nova Scotia as Administrative Agent pursuant to this Section shall also
constitute its resignation as an Issuing Lender. Upon the acceptance of a successor's appointment as Administrative Agent hereunder, (i) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the
retiring Issuing Lender, (ii) the retiring Issuing Lender shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents, and (iii) the successor Issuing Lender shall issue letters of credit in substitution
for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangement satisfactory to the retiring Issuing Lender to effectively assume the obligations of the retiring Issuing Lender with respect to such Letters of
Credit.
 SECTION 13.7           NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER
LENDERS.(a)            Each Lender and each Issuing Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their
Related Parties or the Consultants and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender and each Issuing Lender also acknowledges that it will,
independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties or the Consultants and based on such documents and information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.
 SECTION 13.8 NO OTHER DUTIES, ETC; DOCUMENTATION AGENT.
  

  
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 (a)       Anything herein to the contrary notwithstanding, none of the syndication agents, documentation agents
(other than as noted in subsection (b) below), co-agents, book manager, lead manager, arranger, lead arranger or co-arranger listed on the cover page or signature pages hereof shall have any powers,
duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, a Lender or an Issuing Lender hereunder.
 (b)       (i)        Each of the Lenders and each of the Issuing Lenders
hereby irrevocably appoints Wachovia Bank, National Association as the Documentation Agent hereunder and under the other Loan Documents and authorizes the Documentation Agent to take actions with respect to the documentation of the Credit Facility,
including the preparation and execution of any definitive documentation in connection with the Credit Agreement and the other Loan Documents, together with such actions and powers as are reasonably incidental thereto; provided
 that, anything herein to the contrary notwithstanding, the Documentation Agent shall have no other powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as
applicable, as the Administrative Agent, a Lender or an Issuing Lender hereunder.
 (ii)       The
Documentation Agent and it Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the U.S. Borrower, the Borrower or any Subsidiary or
other Affiliate thereof as if such Person were not the Documentation Agent hereunder and without any duty to account therefor to the Lenders.
 (iii)      The Documentation Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by the
Documentation Agent. The Documentation Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties.
 SECTION 13.9           COLLATERAL AND GUARANTY
MATTERS.(a)             The Lenders irrevocably authorize the Administrative Agent, at its option and in its discretion,
 (b)       to release any Lien on any Collateral granted to or held by the Administrative Agent, for the ratable
benefit of the Secured Parties, under any Loan Document (i) upon repayment of the outstanding principal of and all accrued interest on the Loans and Reimbursement Obligations, payment of all outstanding fees and expenses hereunder, the termination
of the Commitment and the expiration or termination of all Letters of Credit, (ii) that is sold or to be sold or otherwise transferred as part of or in connection with any sale or transfer permitted hereunder or under any other Loan Document, or
(iii) subject to Section 14.2, if approved, authorized or ratified in writing by the Required Agreement Lenders;
 (c)       to subordinate or release any Lien on any Collateral granted to or held by the Administrative Agent under any Loan Document to the holder of any Permitted Lien; and
  

  
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 (d)       to release any Subsidiary Guarantor from its obligations under the Subsidiary Guaranty Agreement, the
Collateral Agreement and any other Loan Documents if such Person ceases to be a Subsidiary as a result of a transaction(s) permitted hereunder.
 Upon request
by the Administrative Agent at any time, the Required Agreement Lenders will confirm in writing the Administrative Agent's authority to release or subordinate its interest in particular types or items of property, or to release any Subsidiary
Guarantor from its obligations under the Subsidiary Guaranty Agreement pursuant to this Section.
 
	  
	 Section 13.10

	 Swingline
Lender.

  
	  
	 (a)
	 Resignation of Swingline Lender.

 (i)        Notwithstanding anything to the contrary contained herein, the Swingline Lender may, upon thirty (30) days' notice to the Borrower, resign as the Swingline Lender. In the event of any such
resignation, the Borrower shall be entitled to appoint from among the Lenders a successor Swingline Lender hereunder; provided that no failure by the Borrower to appoint any such successor shall affect
the resignation of the Swingline Lender; provided further that (i) no Lender shall be required to accept such appointment as successor Swingline Lender; (ii) any successor
Swingline Lender shall be approved by the Administrative Agent (such approval not to be unreasonably withheld or delayed); and (iii) until a Lender shall have notified the Administrative Agent and the current Swingline Lender in writing that it has
agreed to act as a successor Swingline Lender, the current Swingline Lender shall continue as Swingline Lender hereunder. Upon the acceptance of any appointment as Swingline Lender hereunder by a successor, such successor Swingline Lender shall
thereupon succeed to and become vested with all rights, powers, privileges and duties of the replaced Swingline Lender, and the replaced Swingline Lender shall be discharged from its duties and obligations in its capacity as Swingline Lender without
any other or further act or deed on the part of such replaced Swingline Lender or any other Lender.
 (ii)       Any resigning Swingline Lender shall retain all the rights of the Swingline Lender provided for hereunder with respect to Swingline Loans made by it and outstanding as of the effective date of
such resignation, including the right to require the Revolving Credit Lenders to make Revolving Credit Loans or fund risk participations in outstanding Swingline Loans pursuant to Section 2.2(b).
 (b)       Knowledge of Defaults. For purposes
of Section 2.2(b), the Swingline Lender shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given to the Swingline Lender by the U.S. Borrower, the
Borrower, the Administrative Agent, a Lender or an Issuing Lender in accordance with Section 14.1. In the event that the Swingline Lender receives such a notice, it shall promptly give notice thereof to the Administrative Agent, the Lenders and the
Issuing Lenders.
 SECTION 13.11           ADDITIONAL LOANS.
THE ADMINISTRATIVE AGENT AND THE SWINGLINE LENDER SHALL NOT MAKE ANY LOANS AND THE ISSUING LENDER SHALL NOT ISSUE ANY LETTER OF CREDIT TO THE
  
  
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 BORROWER ON BEHALF OF THE LENDERS INTENTIONALLY AND WITH ACTUAL KNOWLEDGE THAT SUCH LOAN OR LETTER OF CREDIT WOULD CAUSE THE AGGREGATE AMOUNT OF THE
TOTAL OUTSTANDING LOANS AND LETTERS OF CREDIT TO EXCEED THE BORROWING BASE, EXCEPT, THAT, FROM AND AFTER THE CONVERSION DATE, THE ADMINISTRATIVE AGENT MAY MAKE ADDITIONAL REVOLVING CREDIT LOANS OR THE ISSUING LENDER MAY PROVIDE SUCH ADDITIONAL
LETTERS OF CREDIT ON BEHALF OF LENDERS, INTENTIONALLY AND WITH ACTUAL KNOWLEDGE THAT SUCH REVOLVING CREDIT LOANS OR LETTERS OF CREDIT WILL CAUSE THE TOTAL OUTSTANDING LOANS AND LETTERS OF CREDIT TO EXCEED THE BORROWING BASE, AS THE ADMINISTRATIVE
AGENT MAY DEEM NECESSARY OR ADVISABLE IN ITS DISCRETION; PROVIDED, THAT: (A) THE SUM OF (I) THE TOTAL PRINCIPAL AMOUNT OF THE ADDITIONAL REVOLVING CREDIT LOANS OR ADDITIONAL LETTERS OF CREDIT TO THE BORROWER THAT THE ADMINISTRATIVE AGENT MAY MAKE OR
PROVIDE AFTER OBTAINING SUCH ACTUAL KNOWLEDGE THAT THE AGGREGATE PRINCIPAL AMOUNT OF THE LOANS AND THE LETTERS OF CREDIT EQUALS OR EXCEEDS THE BORROWING BASE PLUS (II) THE AMOUNT OF SPECIAL AGENT ADVANCES MADE PURSUANT TO SECTION 13.12(B)
OUTSTANDING AS OF ANY DATE OF DETERMINATION SHALL NOT EXCEED AN AMOUNT EQUAL TO TEN PERCENT (10%) OF THE AGGREGATE COMMITMENTS AS OF SUCH DATE WITHOUT THE PRIOR WRITTEN CONSENT OF THE REQUIRED AGREEMENT LENDERS AND SHALL NOT CAUSE (A) THE TOTAL
PRINCIPAL AMOUNT OF THE LOANS AND LETTERS OF CREDIT TO EXCEED THE AGGREGATE COMMITMENTS AS OF SUCH DATE OR (B) THE OUTSTANDING LETTERS OF CREDIT TO EXCEED THE L/C COMMITMENT AND (B) NO SUCH ADDITIONAL REVOLVING CREDIT LOAN OR LETTER OF CREDIT SHALL
BE OUTSTANDING MORE THAN NINETY (90) DAYS AFTER THE DATE SUCH ADDITIONAL REVOLVING CREDIT LOAN OR LETTER OF CREDIT IS MADE OR ISSUED (AS THE CASE MAY BE), EXCEPT AS THE REQUIRED AGREEMENT LENDERS MAY OTHERWISE AGREE. EACH LENDER SHALL BE OBLIGATED
TO PAY TO THE ADMINISTRATIVE AGENT THE AMOUNT OF ITS COMMITMENT PERCENTAGE OF ANY SUCH ADDITIONAL REVOLVING CREDIT LOANS OR LETTERS OF CREDIT IN ACCORDANCE WITH THE APPLICABLE SECTIONS OF THIS AGREEMENT.
 SECTION 13.12           SPECIAL AGENT ADVANCES. THE ADMINISTRATIVE AGENT
MAY, AT ITS OPTION, FROM TIME TO TIME AFTER THE CONVERSION DATE, AT ANY TIME UPON THE OCCURRENCE AND CONTINUATION OF AN EVENT OF DEFAULT OR UPON ANY OTHER FAILURE OF A CONDITION PRECEDENT TO THE LOANS AND LETTERS OF CREDIT HEREUNDER, MAKE SUCH
DISBURSEMENTS AND ADVANCES (COLLECTIVELY, THE "SPECIAL AGENT ADVANCES") WHICH THE ADMINISTRATIVE AGENT, IN ITS SOLE DISCRETION, (A) DEEMS NECESSARY OR DESIRABLE EITHER TO PRESERVE OR PROTECT THE COLLATERAL OR ANY PORTION THEREOF OR (B) TO ENHANCE
THE LIKELIHOOD OR MAXIMIZE THE AMOUNT OF REPAYMENT BY THE CREDIT PARTIES OF THE
  
  
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 LOANS AND OTHER OBLIGATIONS; PROVIDED, THAT (I) THE AGGREGATE PRINCIPAL AMOUNT OF THE SPECIAL AGENT
ADVANCES PURSUANT TO THIS CLAUSE (B) OUTSTANDING AS OF ANY DATE OF DETERMINATION PLUS THE THEN OUTSTANDING PRINCIPAL AMOUNT OF THE ADDITIONAL REVOLVING CREDIT LOANS AND LETTERS OF CREDIT THAT THE ADMINISTRATIVE AGENT AND/OR THE ISSUING LENDER MAY
MAKE OR PROVIDE AS SET FORTH IN SECTION 13.11 SHALL NOT EXCEED AN AGGREGATE AMOUNT EQUAL TO TEN PERCENT (10%) OF THE AGGREGATE COMMITMENTS AS OF SUCH DATE WITHOUT THE PRIOR WRITTEN CONSENT OF THE REQUIRED AGREEMENT LENDERS AND (II) THE AGGREGATE
PRINCIPAL AMOUNT OF THE SPECIAL AGENT ADVANCES PURSUANT TO THIS CLAUSE (B) OUTSTANDING AS OF ANY DATE OF DETERMINATION PLUS THE THEN OUTSTANDING PRINCIPAL AMOUNT OF THE LOANS AND LETTERS OF CREDIT, SHALL NOT EXCEED THE AGGREGATE COMMITMENTS AS OF
SUCH DATE, EXCEPT AT THE ADMINISTRATIVE AGENT'S OPTION, PROVIDED, THAT, TO THE EXTENT THAT THE AGGREGATE PRINCIPAL AMOUNT OF SPECIAL AGENT ADVANCES PLUS THE THEN OUTSTANDING PRINCIPAL AMOUNT OF THE LOANS AND LETTERS OF CREDIT EXCEED THE AGGREGATE
COMMITMENTS, THE SPECIAL AGENT ADVANCES THAT ARE IN EXCESS OF THE AGGREGATE COMMITMENTS SHALL BE FOR THE SOLE ACCOUNT AND RISK OF THE ADMINISTRATIVE AGENT AND NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH BELOW, NO LENDER SHALL HAVE ANY
OBLIGATION TO PROVIDE ITS SHARE OF SUCH SPECIAL AGENT ADVANCES IN EXCESS OF THE SUCH AGGREGATE COMMITMENTS, OR (C) TO PAY ANY OTHER AMOUNT CHARGEABLE TO ANY CREDIT PARTY PURSUANT TO THE TERMS OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS
CONSISTING OF COSTS, FEES AND EXPENSES AND PAYMENTS TO THE ISSUING LENDER IN RESPECT OF ANY OBLIGATIONS WITH RESPECT TO LETTERS OF CREDIT. THE SPECIAL AGENT ADVANCES SHALL BE REPAYABLE ON DEMAND AND TOGETHER WITH ALL INTEREST THEREON SHALL
CONSTITUTE OBLIGATIONS SECURED BY THE COLLATERAL. SPECIAL AGENT ADVANCES SHALL NOT CONSTITUTE LOANS BUT SHALL OTHERWISE CONSTITUTE OBLIGATIONS HEREUNDER. INTEREST ON SPECIAL AGENT ADVANCES SHALL BE PAYABLE AT THE INTEREST RATE (INCLUDING THE
APPLICABLE MARGIN) THEN APPLICABLE TO BASE RATE LOANS AND SHALL BE PAYABLE ON DEMAND. WITHOUT LIMITATION OF ITS OBLIGATIONS PURSUANT TO SECTION 4.7, EACH LENDER AGREES THAT IT SHALL MAKE AVAILABLE TO THE ADMINISTRATIVE AGENT, UPON THE ADMINISTRATIVE
AGENT'S DEMAND, IN IMMEDIATELY AVAILABLE FUNDS, THE AMOUNT EQUAL TO SUCH LENDER'S COMMITMENT PERCENTAGE OF EACH SUCH SPECIAL AGENT ADVANCE. IF SUCH FUNDS ARE NOT MADE AVAILABLE TO THE ADMINISTRATIVE AGENT BY SUCH LENDER, SUCH LENDER SHALL BE DEEMED
A DEFAULTING LENDER AND THE ADMINISTRATIVE AGENT SHALL BE ENTITLED TO RECOVER SUCH FUNDS, ON DEMAND FROM SUCH LENDER TOGETHER WITH INTEREST THEREON FOR EACH DAY FROM THE DATE
  
  
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 SUCH PAYMENT WAS DUE UNTIL THE DATE SUCH AMOUNT IS PAID TO THE ADMINISTRATIVE AGENT AT THE FEDERAL FUNDS RATE FOR EACH DAY DURING SUCH PERIOD AND IF
SUCH AMOUNTS ARE NOT PAID WITHIN THREE (3) DAYS OF THE ADMINISTRATIVE AGENT'S DEMAND, AT THE HIGHEST INTEREST RATE PROVIDED FOR IN SECTION 4.1 APPLICABLE TO BASE RATE LOANS.
 ARTICLE XIV
  
 MISCELLANEOUS
 
	  
	 Section 14.1

	 Notices.

 (a)       Method of Communication
. Except as otherwise provided in this Agreement, all notices and communications hereunder shall be in writing (for purposes hereof, the term "writing" shall include information in electronic format such as electronic mail
and internet web pages), or by telephone subsequently confirmed in writing. Any notice shall be effective if delivered by hand delivery or sent via electronic mail, posting on an internet web page, telecopy, recognized overnight courier service or
certified mail, return receipt requested, and shall be presumed to be received by a party hereto (i) on the date of delivery if delivered by hand or sent by electronic mail, posting on an internet web page, telecopy, (ii) on the next Business Day if
sent by recognized overnight courier service and (iii) on the third (3rd) Business Day following the date sent by certified mail, return receipt requested. A telephonic notice to the Administrative Agent as understood by the
Administrative Agent will be deemed to be the controlling and proper notice in the event of a discrepancy with or failure to receive a confirming written notice.
 (b)       Addresses for Notices. Notices to any party shall be sent
to it at the following addresses, or any other address as to which all the other parties are notified in writing.
 If to the U.S. Borrower

 
	  
	 or the Borrower:
	 Bowater Incorporated

 
	  
	 1155 Metcalfe Street, Suite 800

 
	  
	 Montreal, Québec

 
	  
	 CANADA H3B 5H2

 
	  
	 Attention: Treasurer

 
	  
	 Telephone No.: (514) 394-2375

 
	  
	 Telecopy No.:
(514) 394-2267

 
	  
	 With copies to:
	 Hazen H. Dempster

 Troutman Sanders LLP
 Suite 5200

600 Peachtree Street, N.E.
 Atlanta,
Georgia 30308-2216
 Telephone No.: (404) 885-3126
 
	  
	 Telecopy No.:
(404) 962-6544

  
  
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 If to The Bank of

 Nova Scotia as
 
	  
	 Administrative Agent:
	 The Bank of Nova Scotia

 40 King Street West
 Scotia Plaza,
62nd Floor
 Toronto, Ontario M5W 2X6
 Attention: Corporate Banking Loan Syndication
 Telephone No.:
 Telecopy No.: (416) 866-3329
 
	  
	 If to any Lender:
	 To the address set forth on the Register

  
 (c)       Administrative Agent's Office. The Administrative Agent hereby designates its office located at the address set forth above, or any subsequent office
which shall have been specified for such purpose by written notice to the Borrower and Lenders, as the Administrative Agent's Office referred to herein, to which payments due are to be made and at which Loans will be disbursed and Letters of Credit
requested.
 SECTION 14.2           AMENDMENTS, WAIVERS AND CONSENTS. Except as set
forth below or as specifically provided in any Loan Document, any term, covenant, agreement or condition of this Agreement or any of the other Loan Documents may be amended or waived by the Lenders, and any consent given by the Lenders, if, but only
if, in the case of an amendment, waiver or consent for which a substantially similar corresponding amendment, waiver or consent with regard to the U.S. Credit Agreement will be made effective thereunder contemporaneously, such amendment, waiver or
consent is in writing signed by the Required Lenders (or by the Administrative Agent with the consent of the Required Lenders) and delivered to the Administrative Agent and, in the case of an amendment, signed by the Borrower; and in the case of any
other amendment, waiver or consent specifically impacting only this Agreement and the other Loan Documents, such amendment, waiver or consent is in writing signed by the Required Agreement Lenders (or by the Administrative Agent with the consent of
the Required Agreement Lenders) and delivered to the Administrative Agent and, in the case of an amendment, signed by the Borrower; provided, that no amendment, waiver or consent shall:
 (a)       waive any condition set forth in Section 5.2 without the written consent of each Lender directly affected
thereby;
 (b)       (i) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 12.2) or the amount of Loans of any Lender without the written consent of such Lender or (ii) increase the aggregate Commitments of all Lenders to an aggregate principal amount in excess of $165,000,000
without the consent of the U.S. Required Agreement Lenders;
 (c)       postpone any date fixed by this
Agreement or any other Loan Document for any payment of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender
  

  
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 directly affected thereby; provided, that only the consent of the Required Lenders shall be necessary in order to waive (in
whole or in part) any prepayment required pursuant to Section 8.2(b).
 (d)       reduce the principal of, or the rate of interest specified herein on, any Loan or Reimbursement Obligation, or (subject to clause (iv) of the second proviso to this Section) any fees or other
amounts payable hereunder or under any other Loan Documentwithout the written consent of each Lender directly affected thereby; provided that only the consent of the Required Agreement Lenders shall be
necessary to waive any obligation of the Borrower to pay interest at the rate set forth in Section 4.1(c) during the continuance of an Event of Default;
 (e)       change Section 4.4 or Section 12.4 in a manner that would alter the pro
rata sharing of payments required thereby without the written consent of each Lender directly affected thereby;
 (f)        change any provision of this Section or the definitions of "Required Lenders" or "Required
Agreement Lenders" or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent
of each Lender and each U.S. Lender directly affected thereby;
 (g)       increase the percentage
specified in the definition of "Asset Coverage Amount"; reduce or eliminate any of the Indebtedness specified in part (b) of the definition of "Extensions of Credit" in determining the Borrowing Limit; or add additional categories or types of assets
to the definition of "Coverage Assets", in each case without the written consent of each Lender directly affected thereby;
 (h)       increase any of the percentages specified in the definition of "Borrowing Base"; amend the definitions of "Eligible Accounts" or "Eligible Inventory" in a manner which would result in more
availability under the Borrowing Base; or add additional categories or types of assets to the definition of "Borrowing Base", in each case without the written consent of each Lender directly affected thereby;
 (i)        (i) release the U.S. Borrower from the U.S. Borrower Guaranty, or (ii) release all of the
Subsidiary Guarantors or release Subsidiary Guarantors comprising substantially all of the credit support for the Obligations, in either case, from the Subsidiary Guaranty Agreement (other than as authorized in Section 13.9), in each case without
the written consent of each Lender;
 (j)        release all or substantially all of the
Collateral or release any Security Document (other than as authorized in Section 13.9 or as otherwise specifically permitted or contemplated in this Agreement or the applicable Security Document) without the written consent of each Lender;
or
 (k)       change Article XI of this Agreement without the written consent of each U.S. Lender;

 (l)        add as Collateral any assets of any Person that is not organized under the laws of
Canada or any province thereof without the written consent of the U.S. Administrative Agent and
  
  
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 the U.S. Required Agreement Lenders (it being understood that under the terms of the U.S. Credit Agreement a vote of the Administrative Agent and the Required Agreement
Lenders shall be required to add as Collateral for the U.S. Credit Facility any assets of any Person that is not organized under the laws of the United States or any state thereof); or
 (m)      join as a Credit Party any Person that is not organized under the laws of Canada or any province thereof
without the written consent of the U.S. Administrative Agent and the U.S. Required Agreement Lenders (it being understood that under the terms of the U.S. Credit Agreement a vote of the Administrative Agent and the Required Agreement Lenders shall
be required to join as a U.S. Credit Party any Person that is not organized under the laws of the United States or any state thereof);
 provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the applicable Issuing Lender in addition to the Lenders required above, affect the rights or
duties of such Issuing Lender under this Agreement or any Letter of Credit Application relating to any Letter of Credit issued or to be issued by it; (ii) no amendment, waiver or consent shall, unless in writing and signed by the Swingline Lender in
addition to the Lenders required above, affect the rights or duties of the Swingline Lender under this Agreement; (iii) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders
required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties
thereto. Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.
 
	  
	 Section 14.3

	 Expenses;
Indemnity.

 (a)       Costs and
Expenses. The Borrower and the other Credit Parties, jointly and severally, shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent, the Documentation Agent and their respective
Affiliates (including the reasonable fees, charges and disbursements of (A) counsel for each of the Administrative Agent and the Documentation Agent and (B) the Consultants), in connection with the syndication of the credit facilities provided for
herein, the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by each Issuing Lender in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder
and (iii) all out-of-pocket expenses incurred by the Administrative Agent, the Documentation Agent, any Lender or any Issuing Lender (including the fees, charges and disbursements of (A) any counsel for the Administrative Agent, the
Documentation Agent, any Lender or any Issuing Lender and (B) the Consultants), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this
Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit or (C)
with respect to the preservation and protection of the
  
  

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 Collateral and (iv) all out-of-pocket expenses and costs
heretofore and from time to time hereafter incurred by the Administrative Agent and the Consultants during the course of periodic field audits, examinations and appraisals with respect to the Collateral and the operations of the Credit Parties and
their Subsidiaries, plus a per diem charge at the Administrative Agent's then standard rate for the Administrative Agent's examiners in the field and office.
 (b)       Indemnification. The Borrower and the other Credit Parties
shall indemnify the Administrative Agent (and any sub-agent thereof), the Documentation Agent (and any sub-agent thereof), each Lender and each Issuing Lender, and each Related Party of any of the foregoing Persons (each such Person being called an
"Indemnitee") against, and hold each Indemnitee harmless from, any and all losses, claims (including, without limitation, any Environmental Claims or civil penalties or fines assessed by OFAC), damages,
liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), incurred by any Indemnitee or asserted against any Indemnitee by any third party or by the Borrower or any other Credit Party arising
out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective
obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by any Issuing Lender to
honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or Release of Hazardous
Materials on or from any property owned or operated by the U.S. Borrower or any of its Subsidiaries, or any Environmental Claim related in any way to the U.S. Borrower or any of its Subsidiaries, (iv) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Credit Party, and regardless of whether any Indemnitee is
a party thereto, or (v) any claim (including, without limitation, any Environmental Claims or civil penalties or fines assessed by OFAC), investigation, litigation or other proceeding (whether or not the Administrative Agent, the Documentation Agent
or any Lender is a party thereto) and the prosecution and defense thereof, arising out of or in any way connected with the Loans, this Agreement, any other Loan Document, or any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby, including without limitation, reasonable attorneys and consultant's fees, in all cases, whether or not caused by or arising, in whole or in part, out of the comparative, contributory, or sole negligence
of the Indemnitee, provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by
a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee or (y) result from a claim brought by the Borrower or any other Credit Party against an
Indemnitee for breach in bad faith of such Indemnitee's obligations hereunder or under any other Loan Document, if the Borrower or such Credit Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court
of competent jurisdiction.
 (c)       Reimbursement by Lenders. To the extent that the Borrower for any reason fails to indefeasibly pay any amount required under clause (a) or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agent thereof), the Documentation Agent (or
any sub-agent
  
  
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 thereof), any Issuing Lender or any Related Party of any
of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), the Documentation Agent (or any sub-agent thereof), such Issuing Lender or such Related Party, as the case may be, such Lender's Commitment
Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim,
damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), the Documentation Agent (or any sub-agent thereof) or such Issuing Lender in its capacity as such, or
against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent), the Documentation Agent (or any sub-agent thereof) or such Issuing Lender in connection with such capacity. The obligations of the Lenders
under this clause (c) are subject to the provisions of Section 4.7.
 (d)       Waiver of Consequential Damages, Etc. To the fullest extent permitted by Applicable Law, the Borrower and each other Credit Party shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated
hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee referred to in clause (b) above shall be liable for any damages arising from the use by unintended recipients of
any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.

 (e)       Payments. All amounts due under this
Section shall be payable promptly after demand therefor.
 SECTION
14.4           RIGHT OF SETOFF. If an Event of Default shall have occurred and be continuing, each Lender, each Issuing Lender, the Swingline Lender and each of their respective Affiliates is
hereby authorized at any time and from time to time, to the fullest extent permitted by Applicable Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and
other obligations (in whatever currency) at any time owing by such Lender, such Issuing Lender, the Swingline Lender or any such Affiliate to or for the credit or the account of the Borrower or any other Credit Party against any and all of the
obligations of the Borrower or such Credit Party now or hereafter existing under this Agreement or any other Loan Document to such Lender, such Issuing Lender or the Swingline Lender, irrespective of whether or not such Lender, such Issuing Lender
or the Swingline Lender shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower or such Credit Party may be contingent or unmatured or are owed to a branch or office of such Lender,
such Issuing Lender or the Swingline Lender different from the branch or office holding such deposit or obligated on such indebtedness. The rights of each Lender, each Issuing Lender, the Swingline Lender and their respective Affiliates under this
Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, such Issuing Lender, the Swingline Lender or their respective Affiliates may have. Each Lender, each Issuing Lender and the Swingline Lender
agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.
  

  
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	 Section 14.5

	 Governing
Law.

 (a)       Governing Law.
This Agreement and the other Loan Documents, unless expressly set forth therein, shall be governed by, and construed in accordance with, the law of the State of New York, without reference to the conflicts of law principles thereof insofar as such
principles would defer to the substantive laws of some other jurisdiction.
 (b)       Submission to Jurisdiction. The Borrower and each other Credit Party irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the courts of (i) the State of New York
sitting in New York County and of the United States District Court for the Southern District of New York and (iii) the Province of Ontario, and in each case any appellate court from any thereof, in any action or proceeding arising out of or relating
to this Agreement or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and
determined in such New York State or Ontario court or, to the fullest extent permitted by Applicable Law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or in any other Loan Document shall affect any right that the Administrative Agent, any Lender or any Issuing Lender may
otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or any other Credit Party or its properties in the courts of any jurisdiction.
 (c)       Waiver of Venue. The Borrower and each other Credit Party
irrevocably and unconditionally waives, to the fullest extent permitted by Applicable Law, any objection that it may now or hereafter have to the laying of venue of any action or proceeding arising out of or relating to this Agreement or any other
Loan Document in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by Applicable Law, the defense of an inconvenient forum to the maintenance of such
action or proceeding in any such court.
 (d)       Service of
Process. Each party hereto irrevocably consents to service of process in the manner provided for notices in Section 14.1. Nothing in this Agreement will affect the right of any party hereto to serve process in any other
manner permitted by Applicable Law.
 SECTION 14.6           WAIVER OF JURY TRIAL.
EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PERSON WOULD
  
  
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 NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION
 SECTION 14.7           REVERSAL OF PAYMENTS. To the extent the U.S. Borrower or the Borrower
makes a payment or payments to the Administrative Agent for the ratable benefit of the Lenders or the Administrative Agent receives any payment or proceeds of the Collateral which payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then, to the extent of such
payment or proceeds repaid, the Obligations or part thereof intended to be satisfied shall be revived and continued in full force and effect as if such payment or proceeds had not been received by the Administrative Agent.
 
	  
	 Section 14.8

	 Injunctive
Relief; Punitive Damages.

 (a)       The U.S. Borrower and the Borrower
recognize that, in the event the U.S. Borrower or the Borrower fails to perform, observe or discharge any of its obligations or liabilities under this Agreement, any remedy of law may prove to be inadequate relief to the Lenders. Therefore, the U.S.
Borrower and the Borrower agree that the Lenders, at the Lenders' option, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages.
 (b)       The Administrative Agent, the Lenders and the U.S. Borrower and the Borrower (on behalf of themselves and
the other Credit Parties) hereby agree that no such Person shall have a remedy of punitive or exemplary damages against any other party to a Loan Document and each such Person hereby waives any right or claim to punitive or exemplary damages that
they may now have or may arise in the future in connection with any Dispute, whether such Dispute is resolved through arbitration or judicially.
 SECTION 14.9           ACCOUNTING MATTERS. If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan Document, and either the U.S. Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the U.S. Borrower shall negotiate in good faith to
amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (a) such ratio
or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (b) the U.S. Borrower shall provide to the Administrative Agent and the Lenders financial statements and other documents required under this
Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP.
 SECTION 14.10           SUCCESSORS AND ASSIGNS; PARTICIPATIONS.

 

  
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 (a)       Successors and Assigns Generally. The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that neither the Borrower nor any other Credit Party may assign or otherwise transfer any of its
rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of paragraph (b) of this Section, (ii) by way of participation in accordance with the provisions of paragraph (d) of this Section or (iii) by way of pledge or assignment of a security interest subject to the restrictions of
paragraph (f) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto,
their respective successors and assigns permitted hereby, Participants to the extent provided in paragraph (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders)
any legal or equitable right, remedy or claim under or by reason of this Agreement.
 (b)       Assignments by Lenders. Any Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans at the time owing to it); provided that
 (i)        except in the case of an assignment of the entire remaining amount of the
assigning Lender's Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the aggregate amount of the Commitment (which for this purpose
includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the Administrative Agent or, if "Trade Date" is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000, unless (A) such assignment is made
to an existing Lender, to an Affiliate thereof, or to an Approved Fund, in which case no minimum amount shall apply, or (B) each of the Administrative Agent and, so long as no Default or Event of Default has occurred and is continuing, the
Borrower otherwise consent (each such consent not to be unreasonably withheld or delayed);
 (ii)       each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender's rights and obligations under this Agreement with respect to the Loans or the Commitment
assigned;
 (iii)      (A) the consent of the Administrative Agent (such consent not to
be unreasonably withheld or delayed) shall be required for any assignment in respect of the Credit Facility if such assignment is to a Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with respect to such Lender, (B) the
consent of each Issuing Lender (such consent not to be unreasonably withheld or delayed) shall be required for any assignment that increases the obligation of the assignee to participate in exposure under one or more Letters of Credit (whether or
not then outstanding) and (C) the consent
  
  
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 of the Swingline Lender (such consent not to be unreasonably withheld or delayed) shall be required for any assignment in respect of the Credit
Facility; and
 (iv)      the parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500 for each assignment, and the Eligible Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.
 Subject to acceptance and recording thereof by the Administrative Agent pursuant to paragraph (c) of this Section, from and after the
effective date specified in each Assignment and Assumption, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a
Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption
covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Section 4.8, Section 4.9, Section 4.10, Section 4.11 and Section 14.3 with respect to facts and circumstances occurring prior to the effective date of such assignment. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not
comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (d) of this Section.
 (c)       Register. The Administrative Agent, acting solely for this
purpose as an agent of the Borrower, shall maintain at one of its offices in Montreal, Québec or Toronto, Ontario, a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the
Lenders, and the Commitment of, and principal amounts of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall be conclusive,
and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.
The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
 (d)       Participations. Any Lender may at any time, without the
consent of, or notice to, the Borrower and the Administrative Agent, sell participations to any Person (other than a natural person or the U.S. Borrower, the Borrower or any of the their respective Affiliates or Subsidiaries) (each, a
"Participant") in all or a portion of such Lender's rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii)
the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement.
 Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any
  
  
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 amendment, modification or waiver of any provision of
this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver or modification
described in Section 14.2 that directly affects such Participant. Subject to paragraph (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Section 4.8, Section
4.9, Section 4.10 and Section 4.11to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 14.4as though it were a Lender, provided such Participant agrees to be subject to Section 4.6 as though it were a Lender.
 (e)       Limitations upon Participant Rights. A Participant shall
not be entitled to receive any greater payment under Section 4.10 and Section 4.11than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such
Participant is made with the Borrower's prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 4.11 unless (i) the Borrower is notified of the participation sold to
such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 4.11(e) as though it were a Lender and (ii) the applicable Lender shall provide the Borrower with satisfactory evidence that the participation is
in registered form and shall permit the Borrower to review such register as reasonably needed for the Borrower to comply with its obligations under Applicable Laws.
 (f)        Certain Pledges. Any Lender may at any time pledge
or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
 SECTION 14.11         CONFIDENTIALITY. Each of the Administrative Agent and the Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates' directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by, or required to be disclosed to, any
rating agency, or regulatory or similar authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by Applicable Laws or regulations or by any subpoena or similar
legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies under this Agreement or under any other Loan Document (or any Hedging Agreement with a Lender or the Administrative Agent) or any action or proceeding
relating to this Agreement or any other Loan Document (or any Hedging Agreement with a Lender or the Administrative Agent) or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same
as those of this Section, to (i) any purchasing Lender, proposed purchasing Lender, Participant or proposed Participant, or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the U.S.
Borrower, the Borrower and their respective obligations, (g) with the consent of the U.S. Borrower or the Borrower, (h) to
  
  
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 Gold Sheets and other similar bank trade publications, such information to consist of deal terms and other information customarily found in
such publications, or (i) to the extent such Information (x) becomes publicly available other than as a result of a breach by such Person of this Section or (y) becomes available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than the U.S. Borrower or the Borrower or (j) to governmental regulatory authorities in connection with any regulatory examination of the Administrative Agent or any Lender or in accordance with the Administrative Agent's or any
Lender's regulatory compliance policy if the Administrative Agent or such Lender deems necessary for the mitigation of claims by those authorities against the Administrative Agent or such Lender or any of its subsidiaries or affiliates. For purposes
of this Section, "Information" means all information received from any Credit Party relating to any Credit Party or any of their respective businesses, other than any such information that is available
to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by any Credit Party; provided that, in the case of information received from a Credit Party after the date
hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
 SECTION 14.12         PERFORMANCE OF DUTIES. Each of the Credit Party's obligations under this Agreement
and each of the other Loan Documents shall be performed by such Credit Party at its sole cost and expense.
 SECTION
14.13         ALL POWERS COUPLED WITH INTEREST. All powers of attorney and other authorizations granted to the Lenders, the Administrative Agent and any Persons designated by the Administrative Agent or
any Lender pursuant to any provisions of this Agreement or any of the other Loan Documents shall be deemed coupled with an interest and shall be irrevocable so long as any of the Obligations remain unpaid or unsatisfied, any of the Commitment
remains in effect or the Credit Facility has not been terminated.
 SECTION
14.14         SURVIVAL OF INDEMNITIES. Notwithstanding any termination of this Agreement, the indemnities to which the Administrative Agent and the Lenders are entitled under the provisions of this
Article XIV and any other provision of this Agreement and the other Loan Documents shall continue in full force and effect and shall protect the Administrative Agent and the Lenders against events arising after such termination as well as before.

 SECTION 14.15         TITLES AND
CAPTIONS.(a)             Titles and captions of Articles, Sections and subsections in, and the table of contents of, this Agreement are for convenience only, and neither limit nor
amplify the provisions of this Agreement.
 SECTION 14.16         SEVERABILITY OF PROVISIONS.
Any provision of this Agreement or any other Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating the
remainder of such provision or the remaining provisions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction.
  

  
 172
  
 

  
  
 
  
 -

 SECTION 14.17         COUNTERPARTS. This Agreement may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and shall be binding upon all parties, their successors and assigns, and all of which taken together shall constitute one and the
same agreement.
 SECTION 14.18         INTEGRATION. This Agreement, together with the other
Loan Documents, comprises the complete and integrated agreement of the parties on the subject matter hereof and thereof and supersedes all prior agreements, written or oral, on such subject matter. In the event of any conflict between the provisions
of this Agreement and those of any other Loan Document, the provisions of this Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of the Administrative
Agent or the Lenders in any other Loan Document shall not be deemed a conflict with this Agreement. Each Loan Document was drafted with the joint participation of the respective parties thereto and shall be construed neither against nor in favor of
any party, but rather in accordance with the fair meaning thereof.
 SECTION
14.19         TERM OF AGREEMENT. This Agreement shall remain in effect from the Closing Date through and including the date upon which all Obligations arising hereunder or under any other Loan Document
shall have been indefeasibly and irrevocably paid and satisfied in full and the Commitment has been terminated. No termination of this Agreement shall affect the rights and obligations of the parties hereto arising prior to such termination or in
respect of any provision of this Agreement which survives such termination.
 SECTION
14.20         NO FIDUCIARY DUTY. The Administrative Agent, the Documentation Agent, each Lender and their Affiliates (collectively, solely for purposes of this paragraph, the "Lenders"), may have economic
interests that conflict with those of U.S. Borrower or the Borrower. The U.S. Borrower and the Borrower agree that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or
other implied duty between the Lenders, the U.S. Borrower, the Borrower, their stockholders or Affiliates. The U.S. Borrower and the Borrower acknowledge and agree that (i) the transactions contemplated by the Loan Documents are arm's-length
commercial transactions between the Lenders, on the one hand, and the U.S. Borrower or the Borrower, on the other, (ii) in connection with this Agreement and the Loan Documents, each of the Lenders is acting solely as a principal and not the agent
or fiduciary of the U.S Borrower, the Borrower, their management, stockholders, creditors or any other Person, (iii) no Lender has assumed an advisory or fiduciary responsibility under this Agreement or the Loan Documents in favor of the U.S
Borrower or the Borrower (irrespective of whether any Lender or any of its Affiliates has advised or is currently advising the U.S Borrower or the Borrower on other matters) and (iv) U.S. Borrower and Borrower have consulted their own legal and
financial advisors to the extent it deemed appropriate. U.S. Borrower and Borrower further acknowledge and agree that they are responsible for making their own independent judgment with respect to this Agreement and the Loan Documents. Borrower and
U.S. Borrower agree that they will not claim that any Lender has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to U.S. Borrower or Borrower, in connection with this Agreement and the Loan
Documents.
  
  
 173
  
 

  
  
 
  
 -

 SECTION
14.21         ADVICE OF COUNSEL, NO STRICT CONSTRUCTION. Each of the parties represents to each other party hereto that it has discussed this Agreement with its counsel. The parties hereto have
participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or
burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement.
 SECTION
14.22         USA PATRIOT ACT. The Administrative Agent and each Lender hereby notifies the Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)) (the "Act"), it is required to obtain, verify and record information that identifies the Borrower and each Guarantor, which information includes the name and address of each Borrower
and each Guarantor and other information that will allow such Lender to identify such Borrower or Guarantor in accordance with the Act.
 SECTION 14.23           INCONSISTENCIES WITH OTHER DOCUMENTS; INDEPENDENT
EFFECT OF COVENANTS.
 (a)       In the event there is a conflict or inconsistency between this
Agreement and any other Loan Document, the terms of this Agreement shall control; provided that any provision of the Security Documents which imposes additional burdens on the U.S. Borrower or its
Subsidiaries or further restricts the rights of the U.S. Borrower or its Subsidiaries or gives the Administrative Agent or Lenders additional rights shall not be deemed to be in conflict or inconsistent with this Agreement and shall be given full
force and effect.
 (b)       The U.S. Borrower and the Borrower expressly acknowledge and agree that
each covenant contained in Article VIII, Article IX or Article X, hereof shall be given independent effect. Accordingly, the U.S. Borrower and the Borrower shall not engage in any transaction or other act otherwise permitted under any covenant
contained in Article VIII, Article IX or Article X if, before or after giving effect to such transaction or act, the U.S. Borrower or the Borrower shall or would be in breach of any other covenant contained in Article VIII, Article IX or Article X.

 SECTION 14.24         NO NOVATION. The execution and delivery of this Agreement shall not
constitute a novation of any indebtedness or other obligations owing to the Lenders or the Administrative Agent based on facts or events occurring or existing prior to the execution and delivery of this Agreement.
 

[Signature pages to follow]
  
  
 174
  
 

  
  
 
  
 -

 EXHIBIT B
 to
 Credit Agreement
 dated as of May 31, 2006
 by and among
 Bowater Canadian Forest Products Inc.,
 as Borrower,
 Bowater Incorporated,
 as Guarantor
 the Lenders party thereto,
 as Lenders,
 The Bank of Nova Scotia,
 as Administrative Agent and Issuing Lender,
 and
 Bank of Montreal,
 as Syndication Agent and Swingline Lender
  
  
 FORM OF
NOTICE OF BORROWING
  
  
  
 175
  
 

  
  
 
  
 -

 NOTICE OF BORROWING
  
 Dated as of: _____________
  
 The Bank of Nova Scotia,
 as Administrative Agent
 40 King Street West
 Scotia Plaza, 62nd Floor
 Toronto, Ontario M5W 2X6
 Attention: Corporate Banking Loan
Syndication
  
 Ladies and Gentlemen:
  
 This irrevocable Notice of Borrowing is delivered to you pursuant to
 Section 2.3 of the Credit Agreement dated as of May 31, 2006 (as amended, restated, supplemented or otherwise modified, the "Credit Agreement") by and
among Bowater Canadian Forest Products Inc., a Canadian corporation, as Borrower, Bowater Incorporated, a Delaware corporation, as Guarantor, the lenders who are or may become party thereto, as Lenders, The Bank of Nova Scotia, as Administrative
Agent and Issuing Lender, and Bank of Montreal, as Syndication Agent and Swingline Lender.
  
 1.         The Borrower hereby requests that the [Lenders
] [SwinglineLender] make a [Revolving Credit Loan] [Swingline Loan] to the Borrower in the aggregate principal amount of [$/C$]___________ (Complete with an amount and Permitted Currency in accordance with Section 2.3(a) of the Credit Agreement.)
  
 2.         The Borrower hereby requests that such Loan be made on the following Business Day: ___________. (Complete with a Business Day in accordance with Section 2.3(a) of the Credit Agreement).
  
 3.         The Borrower hereby requests that such Loan bear interest at the following interest
rate, plus the Applicable Margin, as set forth below:
  
 
	  
 Component
of Loan
	  
  
 Interest Rate

	 Interest Period
(LIBOR Rate Loan and BA Loan only)
	 Termination Date
for Interest Period
(if applicable)

	  
	  
	  
	  

	  
	 [Insert
applicable Canadian Prime Rate, Base Rate, BA Discount Rate or LIBOR Rate]1
	  
	  

	  
	  
	  
	  

  
  
  
 176
  
 

  
 _________________________
  
	 1 
	 Complete with (i) the Canadian Prime Rate, the Base Rate, the BA Discount Rate or the LIBOR Rate for Revolving
Credit Loans (provided that the LIBOR Rate and the BA Discount Rate shall not be available until three (3) Business Days after the Closing Date unless the Borrower has delivered to the Administrative
Agent a letter in form and substance satisfactory to the Administrative Agent indemnifying the Lenders in the manner set forth in Section 4.9 of this Agreement) or (ii) the Canadian Prime Rate or the
Base Rate for Swingline Loans.

   
  
 

 4.         The aggregate principal amount of all outstanding Loans (including the Loan requested herein) and all outstanding L/C Obligations does not exceed the maximum amount permitted to be
outstanding pursuant to the terms of the Credit Agreement.
  
 5.         As of the end of the Business Day immediately preceding the date of this Notice of Borrowing
and after giving effect to the Borrower's receipt of the proceeds from the Loan requested pursuant to this Notice of Borrowing and the application of the proceeds thereof, the aggregate amount of cash and Cash Equivalents of (a) the U.S. Borrower
and its Subsidiaries equals $____________ and (b) the Parent equals $_________. (To be completed by Borrower.)
  
 6.         All of the conditions applicable to the Loan requested herein as set forth in the Credit Agreement have been satisfied as of the date hereof and will remain satisfied to the date of such
Loan.
  
 7.         Capitalized terms used herein and not defined herein shall have the meanings assigned thereto in the Credit Agreement.
  
 

[Signature Page Follows]
  
  
 

             IN WITNESS WHEREOF, the undersigned has executed this Notice of Borrowing as of the day and year
first written above.
  
  
 
	  
	  
	 BOWATER CANADIAN FOREST
PRODUCTS INC.

	  
	  
	 By: 
	 

 

	  
	  
	  
	 Name:  
 Title:    

  
  
  
  
 
  
  
 

  
 EXHIBIT K
 to
 Credit Agreement
 dated as of May 31, 2006
 by and among
 Bowater Canadian Forest Products Inc.,
 as Borrower,
 Bowater Incorporated,
 as Guarantor
 the Lenders party thereto,
 as Lenders,
 The Bank of Nova Scotia,
 as Administrative Agent and Issuing Lender,

and
 Bank of Montreal,
 as Syndication Agent and Swingline Lender
  
  
 FORM OF BORROWING BASE CERTIFICATE
  
 SEE ATTACHED
  
  
  
  
  
 

  
  

 
  
BORROWING BASE CERTIFICATE 
   Exhibit K  
     

	 
Bowater Canadian Forest Products Inc. (BCFPI) 
	  Amended Credit
Agreement Date:  
	
 11/XX/2008  

	  Amounts in Thousands  
	  Report Date :  
	  9/30/08  

	     
	  Reports  
	     

	  Pursuant
to the provisions of the Amended Credit Agreement dated as of 11/XX/2008 (said Agreement, as it may be amended or otherwise modified from time to time) and the terms defined therein being used herein as therein defined, among Bowater Canadian Forest
Products Inc. (BCFPI), (Borrower) and The Bank of Nova Scotia (Agent), the undersigned hereby certifies that the following information is true, complete, and accurate as the those of business on September 30, 2008.  
     
     
     
     
	     
	  A/R as of :
 
	     

	     
	  A/R ineligible as
of :  
	     

	     
	  Inventory as of:
 
	     

	     
	  Inventory ineligible
as of:  
	     

	     
	  Exchange Rate
USD/CAD$  
	     

     

	  A.  
	  Combined Accounts Collateral
 
	     
	     
	     
	     

	     
	     
	     
	     
	     
	     

	     
	  1.  Accounts balance (from AR
Schedule)  
	     
	     
	  Bowater Canadian Forest Products Inc. (BCFPI)  
	  Combined  

	     
	  2.  Less: Total
Ineligible Accounts (from AR Schedule)  
	     
	  CAN/US  
	  Foreign  
	  Accounts  

	     
	  3.  Eligible Accounts (A1-A2)
 
	     
	     
	  $                 -  
	  $                -  
	  $              -  

	     
	  4.  Eligible Accounts Advance
Rate  
	     
	     
	                      -   
	                    -  
	                    -  

	     
	  5.  Account. Availability (A3*
A4)  
	     
	     
	  
                   -        
	                    -  
	                    -  

	     
	  6.  Availability Sublimits
 
	  Consolidated Foreign AR Sublimit**  
  BCFPI Foreign AR
Availability  
  BI Foreign AR Sublimit  
	  
$     115,000  
	  85,0%  
	  85,0%  
	  #DIV/01  

	     
	  7.  Accounts Net Availability
 
	  -  
	  $                 -  
	  $                -  
	  $
                -  

	   
 
	   
 
	   115,000  
	     
	     
	     

	  $                 -  
	  $                 -  
	  $                 -  

	   
 
	   
 
	   
 

	     
	     
	     
	     
	     
	     
	     

	     
	     
	     
	  BCFPI  
	     

	  B.  
	  BCFPI  Inventory
Collateral  
	     
	  Raw Material  
	  Work-in Process  
	  US Finished Good  
	  Mills Stores  
	  Total Inventory  

	     
	  1.  Perpetual
Inventory of Borrower (from Inventory Schedule)  
	  $              -  
	  $           -  
	  $            -  
	  $            -  
	  $                -  

	     
	  2.  Less: Total
Ineligible Inventory (from Inventory Schedule)  
	                   -  
	                    -  
	                    -  
	                    -  
	                    -  

	     
	  3  Eligible Inventory (C1
&#150; C2)  
	     
	                    -  
	                    -  
	                    -  
	                    -  
	                    -  

	     
	     
	     
	     
	     
	     
	     
	     

	     
	  4.  Net Orderly Liquidation
Value (NOLV %)  
	     
	  58.4%  
	  48.1%  
	  87.0%  
	  8.4%  
	  #DIV//0!  

	     
	  5.  Eligible
Inventory Advance Rata on NOLV (B4* 85%)  
	  47.9%  
	  40.8%  
	  57.0%  
	  7.1%  
	  #DIV/0!  

	     
	  6.  NOLV Available Inventory
(C3* C5)  
	     
	  $                -  
	  $                -  
	  $                -  
	  $               -  
	          #DIV/0!  

	     
	     
	     
	     
	     
	     
	     
	     

	     
	  7.  Eligible Inventory Advance
Rate on Cost  
	     
	  75.0%  
	  50.0%  
	  75.0%  
	  10.0%  
	  #DIV/0!  

	     
	  8.  Cost Available Inventory (C3
• C7)  
	     
	  $               -  
	  $               -  
	  $                -  
	  $               -  
	  $                -  

	     
	     
	     
	   
 
	   
 
	   
 
	     
	     

	     
	  9.  Leaser of NOLV
or Advance Rata on Cost (Lesser of:C6 orC8)  
	   
 
	   
 
	     
	     

	     
	     
	     
	   
 
	   
 
	   
 
	     
	     

	     
	  10.  Availability Sublimits
 
	     
	  $  
	  $   3,000  
	  $                 
	  $               -  
	  $                -  

	     
	  11.  Inventory Net Availability
 
	     
	  $                -  
	  $                -  
	  $                -  
	  $                -  
	  $                -  

	     
	     
	     
	   
 
	   
 
	   
 
	   
 
	     

	  D.  
	  Allowed Over
Advance (Subject to Amortization Per Credit Agreement  
	   
 
	   
 
	  $                -  

	     
	     
	     
	     
	     
	     
	     
	     

	  E.  
	  Combined Reserves 

	     
	     
	     
	     
	     
	 
BCFPI  

	     
	     
	     
	   
 
	   
 
	   
 
	   
 
	  Reserves  

	     
	  1.  Unpaid Employee
Compensation/Benefits  
	     
	     
	     
	     
	     
	 
-  

	     
	  2.  Rent Reserves (3-months)
 
	     
	     
	     
	     
	     
	  -
 

	     
	  3.  Source
Deductions (payroll taxes, employee pension plan contributions, worker's comp)  
	     
	     
	  -
 

	     
	  4.  Accrued Pension Plan
Contributions  
	     
	     
	     
	     
	     
	  -
 

	     
	  5.  Credit Insurance Deductible
 
	     
	     
	     
	     
	     
	  -
 

	     
	  6.  Credit Insurance Premiums
 
	     
	     
	     
	     
	     
	  -
 

	     
	  7.  Logger's Liens  
	     
	     
	     
	     
	     
	  -
 

	     
	  8.  Cuttings/Harvesting rights
accrual  
	     
	     
	     
	     
	     
	  -
 

	     
	  9.  GST/QST/PST Taxes 

	     
	     
	     
	     
	     
	  -
 

	     
	  10. Other Reserves par
Agent's reasonable discretion  
	     
	     
	     
	     
	  -
 

	     
	  11. Total Reserves (sum D1 to D10)
 
	     
	     
	     
	     
	     
	  $                -  

	     
	    

	     
	     
	     
	     
	     
	   
 

	  F.  
	  Loan Status 

	     
	     
	     
	     
	     
	  Loan Status  

	     
	     
	     
	     
	     
	     
	     
	    

	     
	  1.  Total Revolver Credit Amount
 
	     
	     
	     
	     
	     
	  $   141,000  

	     
	  2.  Total Borrowing Base
Availability:  
	     
	     
	     
	     
	     
	  $                -  

	     
	  3.  Total Net
Borrowing Base Availability (Leaser of E1 and E2)  
	     
	     
	     
	  $                -  

	     
	     
	     
	     
	     
	     
	     
	   
 

	     
	  4.  Less: Total Swingline
Outstanding  
	     
	     
	     
	     
	     
	  $    10,000  

	     
	  5.  Less: Total Revolving Loans
Outstanding  
	     
	     
	     
	     
	     
	  -
 

	     
	  6.  Less: letters of Credit
Outstanding  
	     
	     
	     
	     
	     
	  -  

	     
	  7.  Excess Availability 

	     
	     
	     
	     
	     
	  $    (10,000)                 

	 	 	 	 	 	 	 
	 	 
	 	 	 
	 

     
  *Mill
Stores inventory availability will be zero after first anniversary.  
  **Consolidated (BI + BCFPI) Foreign AR availability sublimit amortizes as follows: $115
million (thru 12/31/08). $100 million (12/31/08 -3/31/09), $75 million (03/31/09 -06/30/09), and $50 million (06/30/09 and thereafter)  
  ***Notwithstanding to
the above, prior to 06/30/2009, if credit insurance maximum credit loss limit decreases below $75 million, consolidated foreign AR availability sublimit will reduce to such lower amount.  
     
  In connection with the foregoing, we hereby acknowledge and
agree that, as of the date hereof, the Agreement remains in full force and effect, is binding upon us and enforceable against us in accordance with its term., and we certify to you that, as of the date hereof, there exists no Event of Default under
the Agreement or event which, with the passage of time or the giving of notice, or both, would so constitute an Event of Default. We hereby restate and renew each and every representation and warranty made by in the Agreement or in connection
therewith, effective as of the date hereof.  
  
  
	
  Bowater Canadian Forest Products Inc.  

	
     

	     

	     

	     

	  Title  

	     

	    Date  

	  

 
 
  pg. 1  
   
    
 
   
 
     
     
     
     
  BORROWING BASE CERTIFICATE 

  Accounts Receivable Detail  
  Exhibit K  
     
     

	  Bowater
Canadian Forest Products Inc. (BCFPI) 
	  Amended Credit
Agreement Date:  
	
 11/XX/2008  

	  Amounts in Thousands  
	  Report Date :  
	  9/30/08  

	     
	  Reports  
	     

	  Pursuant to
the provisions of the Amended Credit Agreement dated as of 11/XX/2008 (said Agreement, as it may be amended or otherwise modified from time to time) and the terms defined therein being used herein as therein defined, among Bowater Canadian Forest
Products Inc. (BCFPI), (Borrower) and The Bank of Nova Scotia (Agent), the undersigned hereby certifies that the following information is true, complete, and accurate as the those of business on September 30, 2008.  
     
     
	     
	  A/R as of : 

	     

	     
	  A/R ineligible as
of :  
	     

	     
	  Inventory as of: 

	     

	     
	     
	     

	     
	     
	     

	  A.  
	   Consolidated
Accounts Collateral  
     
	     
	     
	     

	     
	  1. 

	  Beginning Accounts
balance (A5 from previous BBC)  
	     
	     
	  $                 -  

	     
	  2. 

	  Credit Sales (+) 

	     
	     
	
                         -  
	     

	     
	  3. 

	  Adjustments (-) 

     
	     
	     
	
                         -  
	     

	     
	  4. 

	  Net Collections (-)
 
     
	     
	     
	
                         -  
	     

	     
	  5. 

	  End of Period Accounts
balance (roll forward)  
     
	     
	     
	                         =  
	   $                  -  

	     
	  6. 

	  BCFPI Net Activity from
Coda AR System  
     
	     
	     
	
                        -  
	     

	     
	  7. 

	  Future Dated Invoices
(*)  
	     
	     
	
                         -  
	     

	     
	  8. 

	  Un-reconcilable Amount
(+)  
     
	     
	     
	
                         -  
	     

	     
	  9. 

	  Consolidated Accounts
Receivable balance (per Aging)  
	     
	     
	                         =  
	  $                  -  

	     
	  10. 

	  Unapplied Cash (-)
 
     
	     
	     
	
                  
	                 

	     
	  11. 

	  Consolidated Accounts
Receivable balance (per Aging)  
     
	     
	     
	                         =  
	  
$                  -  

	     
	   
 
	     
	     
	     
	     

	     
	   
 
	     
	     
	     
	  BCFPI  

	     
	   
 
	     
	     
	     
	     
	     

	  B.  
	  Bowater
Canadian Forest Products Inc. (BCFPI) (CAN)  
     
	     
	     
	     
	   $                  -  

	     
	  1.  
	  Accounts
Receivable  balance (per Aging)  
	     
	     
	     
	     

	     
	  2.  
	  Less: Total Ineligible
Accounts  
     
	     
	     
	     
	     

	     
	     
	   
 
	     
	     
	     
	     
	     

	     
	     
	  a. 

	  > 90 days after the
original invoice data or > 60 days past due date  
     
	     
	     
	  -
	     

	     
	     
	  b. 

	  Cross Aged 50% 

     
	     
	     
	  -
	     

	     
	     
	  c. 

	  Credit Balances in the
Past Due category  
     
	     
	     
	  -
	     

	     
	     
	  d. 

	  Offsets  
     
	     
	     
	  -
	     

	     
	     
	  e. 

	  Counterclaims 

     
	     
	     
	  -
	     

	     
	     
	  f. 

	  Disputes  
     
	     
	     
	  -
	     

	     
	     
	  g. 

	  Deductions  

    
	     
	     
	  -
	     

	     
	     
	  h. 

	  Discounts  

    
	     
	     
	  -
	     

	     
	     
	  i. 

	  Recoupment  

    
	     
	     
	  -
	     

	     
	     
	  j. 

	  Reserves  
  Defense  
	     
	     
	  -
	     

	     
	     
	  k. 

	  Defense  
     
	     
	     
	  -
	     

	     
	     
	  l. 

	  Intercompany accounts
 
     
	     
	     
	  -
	     

	     
	     
	  m. 

	  Customers exceeding 10%
of total outstanding receivables  
     
	     
	     
	  -
	     

	     
	     
	  n. 

	  Accrued customer rebates
 
     
	     
	     
	  -
	     

	     
	     
	  o. 

	  Risky Accounts (i.e.
Improper Evidence, Credit Unworthy. Bankruptcy)  
     
	     
	     
	  -
	     

	     
	     
	  p. 

	  Pondered Newsprint Joint
Venture Receivables  
	     
	     
	  -
	     

	     
	     
	  q. 

	  Mersey Paper Joint
Venture Receivables  
	     
	     
	  -
	     

	     
	     
	  r. 

	  Bill and Hold
Receivables  
	     
	     
	  -
	     

	     
	     
	  s. 

	  Guaranteed Sales 

     
	     
	     
	  -
	     

	     
	     
	  t. 

	  Sales or Returns 

	     
	     
	  -
	     

	     
	     
	  u. 

	  Sale on Approval 

     
	     
	     
	  -
	     

	     
	     
	  v. 

	  Consignment  

    
	     
	     
	  -
	     

	     
	     
	  w. 

	  Other Repurchase or
Return Basis  
     
	     
	     
	  -
	     

	     
	     
	  x. 

	  Accounts deemed
ineligible per Agent's reasonable discretion  
	     
	     
	  -
	     

	     
	  3.  
	  Less: Total ineligible
Accounts (sum of B2)  
	     
	     
	   =  
	  $                -  

	     
	  4.  
	  Eligible Accounts
(B1-B3)  
	     
	     
	                  =  
	  $                -  

	     
	     
	   
 
	     
	     
	     
	     
	     

	     
	     
	   
 
	     
	     
	     
	     
	     

	     
	     
	   
 
	     
	     
	     
	     

	     
	     
	   
 
	     
	     
	     
	  BCFPI  
     

	  B.  
	  Bowater
Canadian Forest Products Inc. (foreign)  
	     
	     
	     
	     

	     
	  1.  
	  Accounts
Receivable  balance (per Aging)  
	     
	     
	     
	  $                 -  

	     
	  2.  
	  Less: Total Ineligible
Accounts  
     
	     
	     
	     
	     

	     
	     
	   
 
	     
	     
	     
	     
	     

	     
	     
	  a. 

	  > 180 days after the
original invoice data or > 60 days past due date  
     
	     
	     
	  -
	     

	     
	     
	  b. 

	  Cross Aged 50% 

     
	     
	     
	  -
	     

	     
	     
	  c. 

	  Credit Balances in the
Past Due category  
     
	     
	     
	  -
	     

	     
	     
	  d. 

	  Offsets  
     
	     
	     
	  -
	     

	     
	     
	  e. 

	  Counterclaims 

     
	     
	     
	  -
	     

	     
	     
	  f. 

	  Disputes  
     
	     
	     
	  -
	     

	     
	     
	  g. 

	  Deductions  

    
	     
	     
	  -
	     

	     
	     
	  h. 

	  Discounts  

    
	     
	     
	  -
	     

	     
	     
	  i. 

	  Recoupment  

    
	     
	     
	  -
	     

	     
	     
	  j. 

	  Reserves  
  Defense  
	     
	     
	  -
	     

	     
	     
	  k. 

	  Defense  
     
	     
	     
	  -
	     

	     
	     
	  l. 

	  Customers exceeding 10%
of total outstanding receivables  
	     
	     
	  -
	     

	     
	     
	  m. 

	  Excluded Countries
(Venezuela, Guatemala)  
     
	     
	     
	  -
	     

	     
	     
	  n. 

	  Foreign Uninsured and/or
Over Cap  
     
	     
	     
	  -
	     

	     
	  3.  
	  Less: Total ineligible
Accounts (sum of D2)  
     
	     
	     
	  =  
	  $               -  

	     
	  4.  
	  Eligible Account.
(D1-D3)  
	     
	     
	  =  
	  $               -  

	 	 	 	 	 	 	 	 	 	 

     
     
     
     
     
     
  pg. 2  
   
    
     
     
 
     
   
 
     
  BORROWING BASE CERTIFICATE  
  Inventory Detail  
  Exhibit K  
     
     

	 
Bowater Canadian Forest Products Inc. (BCFPI) 
	  Amended Credit Agreement D.  
	  11/XX/2008  

	  Amounts in Thousands  
	     
	  Report Date :  
	  9/30/08  

	     
	     
	  Reports  
	     

	  Pursuant to the provisions of the Amended Credit Agreement dated as of 11/XX/2008 (said Agreement, as it may be amended or otherwise modified from time to time) and the terms defined therein being used herein as therein defined, among
Bowater Canadian Forest Products Inc. (BCFPI), (Borrower) and The Bank of Nova Scotia (Agent), the undersigned hereby certifies that the following information is true, complete, and accurate as the those of business on September 30, 2008. 

     
     
     
     
     
	   
 
	  Inventory
as of:  
	     

	   
 
	  Inventory
ineligible as of:  
	     

	   
 
	  Exchange
Rate USD/CAD$  
	     

	   
 
	   
 
	     

	   
 
	   
 
	   
 

	     
	    

	     
	     
	     
	     

	     
	    

	  Inventory Categories:  

	  A.  
	   Inventory
Collateral  
	 
   
	  Raw Materials  
	  Work-in-Process  
	  CAN Finished Goods  
	  Mills  
  Stores*  
	  Total Inventory  
	     

	     
	     
	     

	     
	  1.  
	  Perpetual
Inventory of Borrower ***  

	     
	  2.  
	  Less: Ineligible
Inventory for All Inventory Categories:  
	     
	 
$               -  
	 
$             -  
	 
$             -  
	  $             -  
	 
$             -  
	       

	     
	  	  a.  
	  Inventory that
does not have a valid and marketable title  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  b.  
	  Foreign inventory including Mokpo  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  c.  
	  Warehouses <
$100,000  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  d.  
	  Customer
Locations  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  e.  
	  Slow-moving
 
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  f.  
	  Obsolete  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  g.  
	  Returns Not for
Resale  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  h.  
	  Damaged  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  i.  
	  Consigned Inventory
 
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  j.  
	  Offsite Lumber  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  k.  
	  Calhoun Inventory  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  I.  
	  Mersey Inventory  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  m.  
	  Oakhill (Bridgewater) Nova Scotia Inventory  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  n.  
	  Goods that do not conform to the representations, warranties and covenants contained in  agreements  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  o.  
	  Intercompany
Profit  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  p.  
	  "Other" and Partnership Charges  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  q.  
	  Inventory that is not subject to a perfected first priority interest in favor Agent  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  r.  
	  Samples, labels, bags, packaging or shipping materials, display items and other similar  non-merchandise categories  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  s.  
	  Machine Cloth
 
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  t.  
	  Project Stores
 
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  u.  
	  Repair Parts 1 Spare Parts  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  v.  
	  Freight  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  w.  
	  Fuel &
Chemicals  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  x.  
	  Inventory not
reflected in perpetual inventory  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  y.  
	  Inventory that is subject to any license or other arrangement  
	   
 
	  -  
	  -  
	  -  
	  -  
	  -  
	     

	     
	  	  z.  
	  In-Transit Inventory  
	   
 
	
 -  
	
 -  
	
 -  
	
 -  
	
 -  
	     

	     
	     
	     
	   
 
	  -  
	  -  
	     
	     
	     
	     

	     
	  3.  
	  Total Ineligible
Inventory for All Categories (sum of A2)  
	   
 
	
 -  
	
 -  
	
 -  
	
 -  
	
 -  
	     

	     
	  4.  
	  Eligible Inventory Collateral (A1 -A3)  
	     
	  $  -  
	  -  
	   $                   -  
	   $                -  
	   $                   -  
	     

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

     
     
     
     
  • Mill Stores inventory availability will be zero after first anniversary.  
     
     
     
     
     
  pg. 3  
 
  UPDATED SCHEDULE 1.1(C)   
  TO EACH CREDIT AGREEMENT  
  
    
  GRENADA REAL PROPERTY  
     
  LEGAL DESCRIPTION  
     
  TRACT NO. 1 

     
  A  part  or  parcel of Section 25, Township 23 North, Range 4 East,
Sections 30 and 31 in Township 23 North, Range 5 East, and Section 6, Township 22 North, Range 5 East all being in Grenada County, Mississippi, and being more particularly described as follows:    
  The following description is based on the Mississippi State Plane Coordinate System (West Zone), using a convergence angle of 00 degrees 17 minutes 19 seconds and a combined scale factor of .999977825,
based on a closed traverse starting at National Geodetic Survey reference point R-166, said monument found intact and in stable condition at the Grenada Airport.    
  Beginning at a point where the south right-of-way of "Paper Mill Road" intersects the west right-of-way of the Illinois Central Gulf Railroad right-of-way, said point according to deed, "being south 570.88 feet, more or less,
and east 2,180.78 feet, more or less, from the northwest corner of Section 30, Township 23 North, Range 5 East," (and having a coordinate value of N-1578000.896, E-2453940.793 feet on the above referenced coordinate system and lying North 80
degrees 18 minutes 21 seconds West 6,723.90 feet from NGS Reference marker R-166); thence South 15 degrees 38 minutes 29 seconds East, partially along a fence, for a distance of 10,559.21 feet along the west right-of-way of the Illinois Central Gulf
Railroad to a concrete monument; thence along a curve to the left having a radius of 1411.31 feet, a chord bearing South 25 degrees 38 minutes 33 seconds East 491.79 feet to a point in the center of Riverdale (Boteler) Creek; thence along the
centerline of said creek, generally along the following courses and distances: Thence South 42 degrees 42 minutes 11 seconds West for 75.82 feet; thence South 06 degrees 02 minutes 46 seconds West for 500.91 feet; thence along a curve to the right
for 404.26 feet, said curve having a radius of 498.18 feet, a Delta angle of 46 degrees 29 minutes 40 seconds and a chord bearing South 29 degrees 17 minutes 39 seconds West 393.26 feet; thence South 52 degrees 32 minutes 29 seconds West for 426.69
feet; thence along a curve to the left for 207.34 feet said curve having a radius of 818.44 feet, a Delta angle of 14 degrees 30 minutes 53 seconds and a chord bearing South 45 degrees 17 minutes 02 seconds West 206.78 feet; thence South 38 degrees
01 minutes 35 seconds West for 195.05 feet; thence along a curve to the right for 289.61 feet said curve having a radius of 424.38 feet, a Delta angle of 39 degrees 06 minutes 05 seconds and a chord bearing South 57 d e grees 34 minutes 41 se conds
West 284.03 feet; thence South 77 degrees 07 minutes 43 seconds West for 61.24 feet; thence along a curve to the left for 170.81 feet said curve having a radius of 286.45 feet, a Delta angle of 34 degrees 09 minutes 55 seconds and a chord bearing
South 60 degrees 02 minutes 45 seconds West 168.29 feet; thence South 42 degrees 57 minutes 47 seconds West for 702.44 feet; Thence along a curve to the left for 154.13 feet said curve having a radius of 498.15 feet, a Delta angle of 17 degrees 43
minutes 39   seconds  and  a  chord  bearing South  34  degrees  05 minutes  58  seconds  West  153.52  
     
 
  
    feet; thence South 26 degrees 08 minutes 20
minutes West for 177.23 feet to a point on the East right-of-way of U.S. Highway 51 (as of 2007); Thence along said Highway right-of-way, North 28 degrees 34 minutes 03 seconds West for a distance of 132.34 feet; thence North 42 degrees 07 minutes
00 seconds West for a distance of 414.16 feet; thence North 44 degrees 52 minutes 33 seconds West for a distance of  463.01 feet; Thence South 45 degrees 07 minutes 27 seconds West for a distance of 13.97 feet; thence along the meanderings of a
fence North 44 degrees 58 minutes 18 seconds West for a distance of 1648.76 feet to a right-of-way marker at a fence corner on the east right-of-way of U.S. Highway 51 (having a coordinate value of N-1566791.85, E-2453167.15 feet on the above
referenced coordinate system); Thence North 00 degrees 05 minutes 01 minutes East for a distance of 1,163.71 feet along the meanderings of a fence to a concrete monument at a fence corner (having a coordinate value of N-1567955.56, E-2453168.85 on
the above referenced coordinate system); Thence South 89 degrees 55 minutes 56 seconds West for a distance of 440.95 feet along the meanderings of a fence to a concrete monument (having a coordinate value of N-1567955.04, E-2452727.90 feet on the
above referenced coordinate system); Thence North 00 degrees 03 minutes 48 seconds West for a distance of 4,508.20 feet along the meanderings of a fence to 3/4 inch rebar in the fence; Thence North 00 degrees 55 minutes 48 seconds West for a
distance of 1,012.63 feet along the meanderings of a fence to a concrete monument (having a coordinate value of N-157347573, E-2452706.47 feet on the above referenced coordinate system); Thence South 89 degrees 15 minutes 42 seconds West for a
distance of 1,754.60 feet to a 3/4 seconds rebar (having a coordinate value of N-1573453.12, E-2450952.02 feet on the above referenced coordinate system); Thence North 00 degrees 44 minutes 18 seconds West for a distance of 190.96 feet to a concrete
monument on the east right-of-way of "Paper Mill Road" (having a coordinate value of N-1573644.07, E-2450949.56 feet on the above referenced coordinate system); Thence along the east right-of-way of said road as follows: North 36 degrees
38 minutes 27 seconds East for a distance of 703.25 feet to a concrete monument (having a coordinate value of N-1574208.35, E-2451369.25 feet on the above referenced coordinate system); thence along a curve to the left for 694.19 feet to a 3/4 inch
rebar, said curve having a radius of 1959.87 feet, a Delta angle of 20 degrees 17 minutes 40 seconds and a chord bearing North 26 degrees 28 minutes 11 seconds East 690.57 feet (having a coordinate value of N-1574826.53, E-2451677.06 feet on the
above referenced coordinate system); thence North 48 degrees 29 minutes 15 seconds East for a distance of 218.14 feet to a 3/4 inch rebar; thence North 15 degrees 39 minutes 10 seconds West for a distance of 55.27 feet to a railroad spike in the
road; thence North 15 degrees 49 minutes 42 seconds East for a distance of 52.53 feet to a 3/4 inch rebar; thence North 39 degrees 52 minutes 18 seconds West for a distance of 145.22 feet to a 3/4 inch rebar; thence along a curve to the left for
191.10 feet to a concrete right of way marker, said curve having a radius of 1959.87 feet, a Delta angle of 05 degrees 35 minutes 12 seconds and a chord bearing North 02 degrees 47 minutes 51 seconds East 191.03 feet (having a coordinate value of
N-1575377.13, E-2451756.05 feet on the above referenced coordinate system); thence continue along the right of way line North 00 degrees 00 minutes 25 seconds West for a distance of 1265.12 feet to a concrete right of way  marker  (having
a  coordinate  value  of  N-1576642.25, E-2451755.90 feet on the above  
     
 
  
     referenced coordinate system); thence along a curve to the right for 1485.65 feet, said curve having a radius of 1095.78 feet, a Delta
ang1e of 77 degrees 40 minutes 53 seconds and a chord bearing North 38 degrees 51 minutes 32 seconds East 1374.45 feet; thence North 77 degrees 42 minutes 00 seconds East for 1353.63 feet to the "Point of Beginning", enclosing
882.64 acres, more or less.    
  LESS AND EXCEPT NO. 1     
 
A parcel conveyed to BRICK ACADEMY M.B. CHURCH as per deed in Book 234, page 101 and therein described as follows:     
  A part
or parcel of Section 30, Township 23 North, Range 5 East, Grenada County, Mississippi, and being more particularly described as follows:    
  Beginning at a point
2,512.07 feet south, and 77.48 feet East of the Northeast corner of Section 30, Township 23 North, Range 5 East, thence North 63°52'58" East for 92.20 feet to a point; North 15°05'47" East for 149.69 feet to a point; thence North
48°23'29" East for 173.80 feet to a point; thence North 85°23'15" East. for 139.80 feet to a point; thence South 24°55'10" West for 267.65 feet to a point; thence South 62°36'33" West for 307.56 feet to a
point; thence North 04°07'06" West for 72.65 feet to the 'Point of Beginning' of the property herein described, containing 1.37 acres, more or less.    
  Along
with an access easement described as follows:    
  A part or parcel of Section 30, Township 23 North, Range 5 East, Grenada County, Mississippi, and being more
particularly described as follows:    
  Beginning at a point 2,512.07 feet south, and 77.48 feet East of the Northeast corner of Section 30, Township 23 North, Range 5
East, thence South 04°07'06" East for 17.04 feet to a point; South 53°58'25" West for 120.84 feet to a point; thence North 88°45'18" West for 4.86 feet to a point on the east right-of-way of "Paper Mill Road";
thence North 00°33'32" East. for 32.52 feet along the east right-of-way of "Paper Mill Road"; thence South 88°45'18" East for 24.09 feet to a point; thence North 53°58'25" East for 95.16 feet to the 'Point of
Beginning' enclosing 0.047 acres, more or less.    
  The above described TRACT 1 is also subject to the following servitudes and easements:    
  A 40 foot easement to Mississippi Power and Light Company found in Book 239, page 541, (Tract 2).    
  An
easement for a gas line and metering station to Mississippi Valley Gas Company found in Book 242, page 101.    
  An easement 75 feet wide in favor of the U.S.A. as per
deed found in Book 84, page 171.  
 
  
     An Easement for a
transmission line in favor of T.V.A. found in Book 239, page 541.    
  The above described TRACT t is also subject to two encroachments as shown on this survey: a 0.30
acre encroachment lying in a fenced area east of exception No.1 and a 0.40 acre area being used for farming purposes in the western most portion of TRACT I.    
  TRACT NO. 2A     
  A part or parcel of Section 30, in Township 23 North, Range 5 East, Grenada County, Mississippi and being more
particularly described as follows:    
  The following description is based on the Mississippi State Plane Coordinate System (West Zone), using a convergence angle of 00
degrees 17 minutes 19 seconds and a combined scale factor of .999977825, based on a closed traverse starting at National Geodetic Survey reference point R-166, said monument found intact and in stable condition at the Grenada Airport.   

  Commence at a point where the south right-of-way of "Paper Mill Road" intersects the west right-of-way of the Illinois Central Gulf Railroad right-of-way, (said point
according to deed, "being south 570.88 feet, more or less, and east 2,180.78 feet, more or less, from the northwest corner of Section 30, Township 23 North, Range 5 East," and having a coordinate value of N-1578000.896, E-2453940.793 feet
on the above referenced coordinate system and lying North 80 degrees 18 minutes 21 seconds West 6,723.90 feet from NGS Reference marker R-166); thence run North 15 degrees 42 minutes 29 seconds West a distance of 100.12 feet to the intersection of
the west line of the railroad right of way with the north line of "Paper Mill Road"; thence run along the existing north right of way of "Paper Mill Road" South 77 degrees 42 minutes 00 minutes West for 1189.19 feet to the west
line of a tract conveyed to Grenada County Economic Development District said point is the Point of Beginning of the herein described tract;    
  From the Point of
Beginning thence continue along the north line of "Paper Mill Road" South 77 degrees 42 minutes 00 minutes West for a distance of 158.59 feet; thence along a curve to the left for 1061.68 feet, said curve having a radius of 1193.45 feet, a
Delta angle of 50 degrees 59 minutes 04 seconds and a chord bearing South 52 degrees 15 minutes 17 seconds West 1027.29 feet; thence North 01 degrees 45 minutes 19 seconds West a distance of 350.14 feet to a concrete monument found, (said monument
previously the Beginning Point of Original Tract 2, and being described in previous deeds as being "1020.23 feet, more or less South and 9.17 feet, more or less East of the northwest corner of Section 30, Township 23 North, Range 5 East"
and having a coordinate value of N 1577531.35, E 2451773.89 on the above referenced coordinate system); thence continue North 02 degrees 31 minutes 53 seconds West a distance of 292.47 feet to a 3/4 inch rebar set on the south right of way of
Riverdale road (being the same point as the Beginning point described in Parcel 2 of the deed to Newsprint South, Inc., in that certain deed recorded in Book 255, page 18, said point described in said deed as being "located 720.00' South
 of the Northwest  corner  of  Section  30,  Township  23  North,  Range  5  East");  thence  along  
  
    
  said south line of Riverdale Road North 41 degrees 07 minutes 37 seconds East for 52.60 feet; thence North 38 degrees 33 minutes
37 seconds East a distance of 38.50 feet; thence North 34 degrees 41 minutes 37 seconds East a distance of 67.30 feet; thence North 32 degrees 09 minutes 37 seconds East a distance of 169.50 feet; thence North 34 degrees 24 minutes 37 seconds East
for 53.60 feet; thence North 36 degrees 52 minutes 37 seconds East a distance of 65.10 feet; thence North 42 degrees 59 minutes 12 seconds East a distance of 124.34 feet to a 3/4 inch pipe found; thence leave the right of way and run South 23
degrees 33 minutes 16 seconds East a distance of 382.05 feet 3/4 inch iron pipe found; thence run North 50 degrees 44 minutes 12 seconds East a distance of 134.61 feet; thence North 12 degrees 20 minutes 54 seconds West a distance of 415.18 feet to
a 3/ 4 inch iron pipe found on the south line of Riverdale Road; thence North 52 degrees 05 minutes 16 seconds East a distance of 7.63 feet; thence North 59 degrees 21 minutes 05 seconds East a distance of 72.20 feet; thence North 65 degrees 34
minutes 05 seconds East a distance of 56.1 0 feet; thence North 72 degrees 32 minutes 05 seconds East a distance of 57.10 feet; thence North 78 degrees 49 minutes 05 seconds East a distance of 84.68 feet to the northwest corner of a tract conveyed
to the Grenada County Economic Development District, being a concrete monument found, (said monument having the coordinate value of N 1578518.15, E 2452527.08 on the above referenced coordinate system); thence South 18 degrees 26 minutes 35 seconds
East, along said west property line, for a distance of 710.63 feet to the Point of Beginning of the property herein described, containing 12.51 acres, more or less.    
  The above described TRACT 2A is also subject to the following servitudes and easements:    
  A 10 foot easement for an electric power
line to Tallahatchie Valley Electric Power Association as found in Book 242, page 116 (Tract I).    
  The same Tallahatchie Valley Electric Power Association power line
also encumbers the property and exists thereon property now owned by Bowater Newsprint South, Inc. lying north of the above easement, but no documentation has been provided this surveyor.    
  TRACT NO. 2B     
  A part or parcel of Section 30, in Township 23 North, Range 5 East, Grenada
County, Mississippi and being more particularly described as follows:    
  The following description is based on the Mississippi State Plane Coordinate System (West
Zone), using a convergence angle of 00 degrees 17 minutes 19 seconds and a combined scale factor of .999977825, based on a closed traverse starting at National Geodetic Survey reference point R-166, said monument found intact and in stable condition
at the Grenada Airport.  
  Commence at a point where the south right-of-way of "Paper Mill Road" intersects the west right-of-way of the Illinois Central Gulf
Railroad right-of-way, said point according  to  deed,  "being south  570.88  feet,  more  or less, and east 2,180.78 feet,  
 
  
     more or less, from the northwest corner of Section 30, Township 23 North, Range 5 East," (and having a coordinate value of
N-1578000.896, E-2453940.793 feet on the above referenced coordinate system and lying North 80 degrees 18 minutes 21 seconds West 6,723.90 feet from NGS Reference marker R-166); thence run North 15 degrees 42 minutes 29 seconds West a distance of
100.12 feet to the intersection of the west line of the railroad right of way with the north line of "Paper Mill Road," said point is the Point of Beginning of the herein described tract: From the Point of Beginning thence run along the
existing north right of way of "Paper Mill Road" South 77 degrees 42 minutes 00 minutes West for 982.59 feet to the east line of a tract conveyed to Grenada County Economic Development District; thence along said east property line North
16 degrees 43 minutes 01 seconds West a distance of 368.25 feet to a concrete monument found; thence continue North 16 degrees 43 minutes 01 seconds West a distance of 299.98 feet to a fence post in concrete found on the south right of way of
Riverdale road; thence along said south line of Riverdale Road; thence along the south line of Riverdale road North 88 degrees 39 minutes 52 seconds East for 124.87 feet; thence North 89 degrees 55 minutes 42 seconds East a distance of 178.55 feet;
thence South 88 degrees 23 minutes 52 seconds East for 138.94 feet; thence South 86 degrees 11 minutes 03 seconds East a distance of 273.89 feet to a 3/4 inch pipe found; thence South 85 degrees 28 minutes 06 seconds East a distance of 329.24 feet
to point, said point being the intersection of the south line of Riverdale Road and the west right of way of the Illinois Central Gulf Railroad; thence South 15 degrees 42 minutes 29 seconds East, partially along a fence, for 300.00 feet along the
West right-of-way of the Illinois Central Gulf Railroad to a concrete monument; thence continue along said right of way and fence South 15 degrees 42 minutes 29 seconds East a distance of 100.68 feet to the Point of Beginning of the property herein
described, containing 12.36 acres, more or less.    
  LESS AND EXCEPT NO.2     
  (STAHAM CEMETERY PER BOOK 233, PAGE 328)  
  (As per deed description of record):    
  A part or parcel of Section 30, Township 23 North, Range 5 East, all being in Grenada County, Mississippi, and being more particularly described as follows:  
  Beginning at a concrete monument 436.89 feet South, and 1,207.71 feet east of the Northwest corner of Section 30; then South 08°48'12" East for 104.36 feet to a concrete monument; then North
81°11'48" East, for 104.36 feet to a concrete monument; then North 08°48'12" West, for 104.36 feet to a concrete monument; then South 81°11'48" West for 104.36 feet to the "Point of Beginning", of the property
herein described, containing 0.25 acres, more or less.    
  ALSO:    
 
Any cloud on title due to the erroneous description of Tract 3, of Book 247, Page 358. The description of Tract 2B above considers that the intent of the conveyance in Book 247, page 358 was to convey four (4) contiguous parcels.
  
  

   
  The above described TRACT 28 is also subject to the following servitudes and casements:    
  A 10 foot easement for an electric power
line to Tallahatchie Valley Electric Power Association as found in Book 242, page 116 (both tracts).    
  The same Tallahatchie Valley Electric Power Association power
line also encumbers the property and exists thereon property now owned by Bowater Newsprint South, Inc. lying north of the above easement, but no documentation has been provided this surveyor.    
  An easement of ingress and egress to and from "'Less and Except No.2", for which no description has been defined.    
  TRACT NO. 3     
  A part or parcel of Sections 6 and 7, Township 22 North, Range 5 East, all
being in Grenada County, Mississippi, and being more particularly described as follows:    
  Beginning at a concrete monument at a fence corner; said monument is located
10,606.16 feet more or less South, and 872.84 feet more or less east of the northwest corner of Section 30, Township 23 North, Range 5 East, Grenada County, Mississippi, from said concrete monument, thence South 4,888.11 feet and 1,157.75 feet east
to a concrete monument, said point being the "Point of Beginning" of the property herein described; then south 38°05'28" east, 305.99 feet to a point; then south 51°54'32" west, 500.00 feet, to a point at the centerline
of the Yalobusha River; then north 38°05'28" west 500.00 feet along the centerline of said river to a point where the centerline of Riverdale Creek intersects the centerline of the Yalobusha River; then north 51°17'12" east,
500.03 feet along the centerline of Riverdale Creek to a point; then south 38°05'28" east 199.46 feet to the "Point of Beginning seconds of the property herein described, containing 5.77 acres, more or less.    
  Subject to that perpetual easement in favor of the United States of America as same is recorded in book 103, Page 133 of the Land Deed Records of Grenada County, Mississippi.  
 
  And the following perpetual rights of way for road purposes and a perpetual easement for purposes of installing and maintaining water and other utility lines over,
under and across the following described property in Grenada County, Mississippi, to wit:    
  A part or parcel of Section 6, Township 22
North, Range 5 East, all being in Grenada County, Mississippi, and being more particularly described as follows:    
  Beginning at a concrete monument at a fence corner,
said monument is located 10,606.16 feet more or less south, and 872.84 feet more or less east of the northwest  
     
 
  
     corner of Section 30, Township 23 north. Range 5 east, Grenada County, Mississippi, from said
concrete monument, thence South 3,582.31 feet and 2,011.21 feet east to a concrete monument, said point bein2 the 'Point of Be2inning seconds of the property herein described; then south 33°10'06" west, 1,559.98 feet to a concrete
monument; then north 38°05'28" west, 104.77 feet to a concrete monument; then north 33°10'06" east, 1,574.92 feet to a concrete monument; then south 30°43'52" east, 110.48 feet to the "Point of Be2inning seconds of
the property herein described, containing  3.57 acres, more or less;    
  and also,    
  A part or parcel of Section 6, Township 22 North, Range 5 East, all being in Grenada County, Mississippi, and being more particularly described as follows:    
  Beginning at a concrete monument at a fence corner, said monument is located 10,606.16 feet more or less south, and 872.84 feet more or less east of the northwest corner of Section 30, Township 23 north. Range 5 east, Grenada County,
Mississippi, from said concrete monument, thence South 3,582.31 feet and 2,011.21 feet east to a concrete monument, said point being the 'Point of Beginning' of the property herein described; then north 30 degrees 43 minutes 52 seconds west, 188.01
feet to a point at the centerline of Riverdale Creek; then north 44°58'07" east, 103.20 feet along the centerline of said creek to a point on the west, right-of-way of U.S. Highway 51; then south 30°43'52" east, 271.13 feet along
the west right-of-way to a point; then south 59°16'08" west, 100.00 feet to a point; then north 30°43'52" west 57.63 feet to the "Point of Beginning seconds, of the property herein described, containing 0.59 acres,
more or less.  
  
    
  COOSA PINES  
  REAL PROPERTY - FEE    
  LEGAL DESCRIPTION    
  TRACT NO. 1     
  COMMENCE AT THE SOUTH EAST CORNER OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST,
TALLADEGA COUNTRY, ALABAMA; THENCE.: NORTH 00°01'14" WEST ALONG THE EAST BOUNDARY OF SAID SECTION A DISTANCE OF 435.45 FEET TO THE  POINT-OF- BEGINNING. FROM THE POINT-OF-BEGINNING;THENCE SOUTH 88°37'51" WEST FOR A DISTANCE
OF 3904.74 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 00°18'01" FAST A DISTANCE OF 685.74 FEET TO A POINT ON THE EAST RIGHT-OF-WAY LINE OF ALABAMA HIGHWAY NO. 235; THENCE, ALONG; SAID EAST RIGHT-OF-WAY LINE, NORTH 51°57'00"
WEST A DISTANCE OF 313.76 FEET TO THE P.C. OF A CONCAVE CURVE RIGHT; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE RIGHT WITH A RADIUS OF 1372.40 FEET, A CHORD BEARING OF NORTH 34°41'39" WEST A CHORD DISTANCE OF
985.90 FEET TO A FOUND IRON PIN; THENCE, LEAVING SAID EAST RIGHT-OF-WAY NORTH 85°52'31" FAST A DISTANCE OF 228.05 FEET TO A SET IRON PIN; THENCE NORTH 00o07'30" WEST A DISTANCE OF 325.60 FEET TO A SET IRON PIN; THENCE SOUTH
85°49'28" WEST A DISTANCE OF 267.50 FEET TO FOUND IRON PIN ON THE EAST RIGHT-OF-WAY LINE OF SAID ALABAMA HIGHWAY NO. 235; THENCE, ALONG SAID EAST RIGHT-OF-WAY LINE NORTH 00°14'28" WEST A DISTANCE OF 564.88 FEET TO THE P.C. OF A
CONCAVE CURVE LEFT; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE LEFT WITH A RADIUS OF 1987.73 FEET, A CHORD HEARING OF NORTH 09°49'18" WEST A CHORD DISTANCE OF 658.42 FEET TO THE P.T. OF SAID CURVE; THENCE
CONTINUING ON SAID EAST RIGHT-OF-WAY, NORTH 15°25'13" WEST A DISTANCE OF 1240.12 FEET TO THE P.C. OF A CONCAVE CURVE RIGHT; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE RIGHT WITH A RADIUS OF 1848.50 FEET, A CHORD
BEARING OF NORTH 06°48'36" WEST A CHORD DISTANCE OF 553.50 FEET TO THE P.T. OF SAID CURVE; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, NORTH 00°07'17" EAST A DISTANCE OF 1267.14 FEET TO THE P.C. OF A CONCAVE CURVE RIGHT;
THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE RIGHT WITH A RADIUS OF 1372.39 FEET, A CHORD BEARING OF NORTH 14°38'49" EAST A CHORD DISTANCE OF 755.96 FEET TO THE P.T. OF SAID CURVE; THENCE, CONTINUING ON SAID EAST
RIGHT-OF-WAY, NORTH 29°33'44" EAST A DISTANCE OF 268.30 FEET TO A FOUND CONCRETE MONUMENT AT THE P.C. OF A CONCAVE CURVE LEFT; THENCE, CONTINUING ON SAID EAST RIGHT- OF-WAY, ALONG SAID CURVE TO THE LEFT WITH A RADIUS OF 1454.47 FEET, A
CHORD BEARING OF NORTH 21°25'25" EAST A CHORD DISTANCE  OF  344.27  FEET TO  A  FOUND  IRON PIN; THENCE, LEAVING  
    

 
  
     SAID EAST RIGHT-OF-WAY, SOUTH 89°58'6'' EAST A DISTANCE OF 37.39
 FEET TO A SET IRON PIN; THENCE SOUTH 00°05'3'' WEST A DISTANCE OF 310.00 FEET TO A POINT; THENCE NORTH 90°00'00" EAST A DISTANCE OF 248.00 FEET TO A POINT THAT IS 12 FEET NORTH OF AND AT RIGHT ANGLES TO THE CENTERLINE OF A
RAILROAD SPUR TRACK; THENCE NORTH 64°35'03" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 135.91 FEET; THENCE NORTH 67°25'24'' EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF
66.23 FEET; THENCE NORTH 76°00'26" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 73.18 FEET; THENCE NORTH 85°31'37" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 90.35
FEET; THENCE NORTH 85°03'20" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 79.70 FEET; THENCE NORTH 74°19'35" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 101.92
FEET; THENCE NORTH 62°21'50" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 89.57 FEET; THENCE NORTH 51°10'37" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 113.83
FEET; THENCE NORTH 39°46'49" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 49.10 FEET TO SET IRON PIN; THENCE NORTH 00°00'6'' EAST A DISTANCE OF 316.39 FEET TO A SET IRON PIN; THENCE NORTH
89°59'12" WEST A DISTANCE OF 958.84 FEET TO A FOUND CONCRETE MONUMENT ON THE EAST RGHT-OF-WAY LINE OF SAID ALABAMA HIGHWAY 235; THENCE, ALONG SAID EAST RIGHT-OF-WAY, ALONG A CURVE TO THE LEFT WITH A RADIUS OF 958.05 FEET, A CHORD BEARING
OF NORTH 02°36'11". EAST A CHORD DISTANCE OF 42.53 FEET TO A FOUND CONCRETE MONUMENT; THENCE, LEAVING SAID EAST RIGHT-OF-WAY, NORTH 89°54'55" EAST A DISTANCE 985.00 FEET TO A SET IRON PIN; THENCE SOUTH 80°05'41" EAST A
DISTANCE OF 250.00 FEET TO A SET IRON PIN; THENCE SOUTH 25°26'11" EAST A DISTANCE OF 39.28 FEET TO A FENCE CORNER; THENCE SOUTH 49°17'11" EAST A DISTANCE OF 120.95 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH
64°56'35" EAST A DISTANCE OF 151.58 FEET TO A FOUND CONCRETE MONUMENT; THENCE NORTH 89°59'26" EAST A DISTANCE OF 109.96 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 00°05'23" EAST A DISTANCE OF 119.99 FEET TO A FOUND
CONCRETE MONUMENT; THENCE NORTH 89°54'01" EAST A DISTANCE OF 10504.30 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 30°04'34" EAST A DISTANCE OF 1589.89 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 46°24'37" WEST A
DISTANCE OF 1043.84 FEET TO FOUND IRON PIN; THENCE SOUTH 46°15'58" WEST A DISTANCE OF 2344.35 FEET TO A FOUND IRON PIN; THENCE SOUTH 63°32'16" WEST A DISTANCE OF 3427.78 FEET TO A FOUND CONCRETE MONUMENT, SAID POINT BEING LOCATED
ON THE EAST BOUNDARY  OF THE SOUTHEAST ONE-FOURTH  OF  THE  SOUTHWEST  ONE-FOURTH  OF  SECTION 4,  
  
  
 
  TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THENCE SOUTH 00°14'33" EAST ALONG THE EAST BOUNDARY OF SAID QUARTER-QUARTER SECTION FOR A DISTANCE OF
759.27 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 88o37'51" WEST A DISTANCE OF 26.30.64 FEET TO THE POINT-OF-BEGINNING.    
  THE ABOVE DESCRIBE LAND
IS LOCATED IN THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTH-WEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST
ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 32, TOWNSHIP 19 SOUTH, RANGE 3 EAST; THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST
ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 33, TOWNSHIP 19 SOUTH, RANGE 3 EAST; THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH
OF THE SOUTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 34, TOWNSHIP 19 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE
NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE
NORTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE NORTHEAST
ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST
ONE-FOURTH OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH AND THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH OF SECTION 8, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE
NORTHWEST ONE- FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, 
 THE   SOUTHWEST    ONE-FOURTH  OF   THE  
  
    
  NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH O THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST
ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHIWEST
ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 4, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH
OF THE NORTHEAST ONE-FOURHT, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH AND THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 3, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEDA
COUNTY, ALABAMA, AND CONTAINS 1519.43 ACRES MORE OR LESS.    
  TRACT NO.2     
  COMMENCE AT THE SOUTHEAST CORNER OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THENCE NORTH 00°01'14" WEST ALONG THE EAST BOUNDARY OF SAID SECTION A DISTANCE OF 435.45
FEET; THENCE SOUTH 88°37'51" WEST A DISTANCE OF 3904.74 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 00°18'01" EAST A DISTANCE OF 685.74 FEET TO A POINT ON THE EAST RIGHT-OF-WAY LINE OF ALABAMA HIGHWAY 235; THENCE SOUTH
15°19'07" WEST A DISTANCE OF 130.11 FEET TO A P.T. ON THE WEST RIGHT-OF-WAY LINE OF SAID HIGHWAY, SAID POINT BEING THE POINT-OF-BEGINNING. FROM SAID POINT-OF-BEGINNING, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE RIGHT WITH A RADIUS
OF 2907.08 FEET, A CHORD BEARING OF SOUTH 46°50'20" EAST A CHORD DISTANCE OF 363.13  FEET  TO  A  FOUND  CONCRETE  MONUMENT;  THENCE, ALONG SAID WEST  RIGHT-OF-WAY,  SOUTH 16°47'50"
 EAST A  DISTANCE  OF  102.00  FEET TO A POINT,  SAID POINT  BEING  THE  P.C.  OF  A  CONCAVE  CURVE   RIGHT; THENCE, ALONG  SAID  WEST  RIGHT-OF-WAY,
 ALONG  A  CURVE  TO  THE RIGHT  WITH  A  RADIUS  OF  1266.43  FEET,   A    CHORD  BEARING   OF  SOUTH  30°31 '54" EAST A CHORD
 DISTANCE   OF 360.99 FEET TO A POINT BEING THE P.C.C. OF A CONCAVE CURVE RIGHT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG  A  CURVE  TO THE  RIGHT WITH A RADIUS OF 1373.05  FEET,  A  CHORD
 BEARING  OF SOUTH  04°23'57"  EAST  A  CHORD  DISTANCE OF 901.30  FEET  TO  THE P.T.  OF  SAID  CURVE;  THENCE,  ALONG  SAID  WEST  RIGHT-OF-WAY,
SOUTH  14°50'27"  WEST  A  DISTANCE  OF 270.16  FEET  TO ITS POINT OF  

      
  INTERSECTION WITH THE NORTHERLY BANK OF TALLADEGA CREEK, THENCE, LEAVING SAID WEST RIGHT-OF-WAY NORTH 82°02'05" WEST ALONG THE NORTHERLY BANK OF SAID CREEK A DISTANCE OF 955.11
FEET; THENCE NORTH 89°22'49" WEST ALONG THE NORTHERLY BANK OF SAID CREEK A DISTANCE OF 393.55 FEET; THENCE SOUTH 67°21 '42" WEST ALONG THE NORTHERLY BANK OF SAID CREEK A DISTANCE OF 145.25 FEET TO ITS POINT OF INTERSECTION WITH
THE EAST BANK OF THE COOSA RIVER; THENCE NORTH 11°09'16" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 218.25 FEET; THENCE NORTH 18°43'47" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 545.19 FEET; THENCE NORTH
23°17'47" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 809.60 FEET; THENCE NORTH 33°28'31" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 923.89 FEET; THENCE NORTH 38°40'43" WEST ALONG THE EAST BANK OF
SAID RIVER A DISTANCE OF 1096.84 FEET; THENCE NORTH 28°58'02" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 484.20 FEET; THENCE NORTH 17°34'17" WEST ALONG; THE EAST BANK OF SAID RIVER A DISTANCE OF 373.45 FEET; THENCE
NORTH 00°38'39" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 401.12 FEET; THENCE NORTH 09°34'23" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 406.75 FEET; THENCE NORTH 14°32'05" EAST ALONG THE EAST BANK
OF SAID RIVER A DISTANCE OF 1024.24 FEET; THENCE NORTH 22°45'53" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 606.03 FEET; THENCE NORTH 30°13'12" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 349.43 FEET; THENCE
NORTH 18°26'48" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 641.35 FEET; THENCE NORTH 02°51'52" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 360.98 FEET; THENCE NORTH 09°33'20" WEST ALONG THE EAST BANK
OF SAID RIVER A DISTANCE OF 498.13 FEET; THENCE SOUTH 89°19'26" WEST ALONG THE BANK OF THE RIVER AND ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 57.62 FEET; THENCE NORTH 00°07'03" EAST ALONG THE EDGE OF THE RIVER PUMP
HOUSE A DISTANCE OF 37.57 FEET; THENCE NORTH 88°50'36" WEST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 29.08 FEET; THENCE NORTH 00°18'41" WEST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 31.47 FEET; THENCE
NORTH 89°54'13" EAST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 27.94 FEET; THENCE NORTH 00°06'59" EAST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 38.37 FEET; THENCE NORTH 19°33'01 EAST ALONG THE EAST
BANK OF SAID RIVER A DISTANCE OF 112.60 FEET TO A FOUND IRON PIN; THENCE, LEAVING SAID RIVER, NORTH 89°51'15" EAST A DISTANCE OF 400.08 FEET TO A FOUND IRON PIN; THENCE SOUTH 03°31'19" EAST A DISTANCE OF 601.42 FEET TO A SET IRON
PIN; THENCE NORTH 85°05'19" EAST A 11ISTANCE OF 363.93 FEET TO A FOUND IRON PIN ON THE WEST RIGHT-OF-WAY OF SAID ALABAMA HIGHWAY NO. 235;  THENCE,  ALONG SAID WEST RIGHT-OF-WAY. ALONG A CURVE TO  
 
  
     THE RIGHT WITH A RADIUS OF 1492.39 FEET, A CIIORD HEARING OF SOUTH 03°06'52" WEST A
CHORD DISTANCE OF 228.69 FEET TO THE P.T. OF SAID CUIRVE; THENCE, ALONG SAID WEST RIGHT-OF-WAY, SOUTH 00°07'17" WEST TO THE P.C. OF A CONCAVE CURVE TO THE LEFT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE LEFT WITH A RADIUS
OF 1968.50 FEET, A CHORD) BEARING OF SOUTH 06°50'09" EAST A CHORD DISTANCE OF 587.66 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID WEST RIGTH-OF-WAY, SOUTH 15°25'13" EAST A DISTANCE OF 1244.31 FEET TO THE P.C. OF A CONCAVE
CUJRVE TO THE RIGHT THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE RIGHT WITH A RADIUS OF 1867.73 FEET, A CHORD BEARING OF SOUTH 09°53'02" EAST A CHORD DISTANCE OF 622.67 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID WEST
RIGHT-OF-WAY, SOUTH 00°14'28" EAST A DISTANCE OF 564.88 FEET TO THE P.C. OF A CONCAVE CURVE TO THE LEFT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE LEFT WITH A RADIUS OF 1492.40 FEET, A CHORD BEARING OF SOUTH
27°48'34" EAST A CHORD DISTANCE OF 1387.36 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID WEST RIGHT-OF-WAY, SOUTH 51°57'00" EAST A DISTANCE OF 363.16 FEET TO THE POINT-OF-BEGINNING.    
  THE ABOVE DESCRIBED LAND IS LOCATED IN THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 31, TOWNSHIP 19 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THE NORTHEAST ONE-FOURTH OF THE
NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE
NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION 6, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST
AND THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE
NORTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH OF SECTION 8, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION 7, TOWNSHIP 20 SOUTH, RANGE 3 EAST AND CONTAINS 274.86 ACRES
MORE OR LESS.  
     
 
  TRACT NO.3     
  COMMENCE AT THE SOUTHEAST CORNER OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THENCE SOUTH 55°2~'14" WEST A DISTANCE OF 4238.27 FEET TO A POINT OF
INTERSECTION BETWEEN THE WEST RIGHT-OF-WAY OF ALABAMA HIGHWAY NO. 235 ANID THE SOUTH BANK OF TALLADEGA CREEK, SAID POINT BEING THE POINT-OF-BEGINNING, FROM SAID POINT-OF-BEGINNING, THENCE, ALONG SAID WEST RIGHT-OF-WAY, SOUTH
14o50'27" WEST A DISTANCE OF 296.71 FEET TO THE P.C. OF A CONCAVE CURVE LEFT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE LEFT WITH A RADIUS OF 1716.27 FEET, A CHORD BEARING OF SOUTH 04°06'31" EAST A CHORD
DISTANCE OF 1114.63 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID WEST RIGHT-OF-WAY, SOUTH 20°38'30" EAST A DISTANCE OF 7.40 FEET TO ITS POINT OF INTERSECTION WITH THE SOUTH BOUNDARY OF AN ALABAMA POWER COMPANY TRANSMISSION LINE
RIGHT-OF-WAY; THENCE SOUTH 66°52'56" WEST ALONG THE SOUTH BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-OF-WAY A DISTANCE OF 357.06 FEET TO A POINT ON THE NORMAL POOL ELEVATION OF LAY LAKE; THENCE NORTH 21°38'43" EAST ALONG THE
NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 140.84 FEET TO A POINT ON THE NORTH BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-OF-WAY; THENCE NORTH 04°03'08" WEST ALONG THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 514.78 FEET;
THENCE NORTH 67°50'50" WEST ALONG THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 62.84 FEET; THENCE SOUTH 02°18'13" WEST ALONG THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 429.05 FEET; THENCE SOUTH
26°04'08" WEST ALONG THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 219.84 FEET TO ITS POINT OF INTERSECTION WITH THE NORTH BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-Of-WAY; THENCE SOUTH 66°52'54" WEST ALONG THE NORTH
BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-OF-WAY AND ALONG THE NORMAL POOL ELEVATION OF SAID LAY LAKE A DISTANCE OF 333.54 FEET TO ITS POINT OF INTERSECTION WITH THE EAST BANK OF THE COOSA RIVER; THENCE NORTH 24°59'29" WEST ALONG THE
EAST BOUNDARY OF SAID COOSA RIVER A DISTANCE OF 545.38 FEET; THENCE NORTH 23°23'23" WEST ALONG THE EAST BOUNDARY OF SAID COOSA RIVER A DISTANCE OF 450.66 FEET; THENCE NORTH 15°04'42" WEST ALONG THE EAST BANK OF SAID COOSA RIVER A
DISTANCE OF 522.07 FEET; THENCE NORTH 06°38'59" WEST ALONG THE EAST BANK OF SAID COOSA RIVER A DISTANCE OF 223.39 FEET TO ITS POINT OF INTERSECTION WITH THE SOUTH BANK OF THE AFOREMENTIONED TALLADEGA CREEK; THENCE NORTH 46°21'05"
EAST  ALONG  THE  SOUTH BANK OF SAID CREEK A DISTANCE OF 131.09 FEET;  THENCE  NORTH 83°08'27"  EAST  ALONG  THE  SOUTH BANK OF SAID  CREEK  A  DISTANCE  OF  234.50
 FEET;  THENCE  SOUTH  
  
    
  81o37'09" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 576.06 FEET; THENCE SOUTH 85°47'43" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 459.84 FEET TO THE POINT-OF-BEGINNING.    

 THE ABOVE DESCRIBED LAND IS LOCATED IN THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE
SOUTHWEST ONE-FOURTH AND THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 8, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA, AND CONTAINS 37.68 ACRES MORE OR LESS.    
  TRACT NO. 4     
  COMMENCE AT THE NORTHEAST CORNER OF THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST
ONE-FOURTH OF SECTION 31, TOWNSHIP 19 SOUTH, RANGE 3 EAST, SHELHY COUNTY, ALABAMA, SAID POINT BEING THE POINT-OF-BEGINNING FROM SAID POINT-OF-BEGINNING NORTH 01°20'25" WEST ALONG THE WEST BOUNDARY OF THE SOUTHEAST ONE-FOURTH OF THE
NORTHWEST ONE-FOURTH A DISTANCE OF 763.60 FEET TO A POINT ON THE SOUTH BANK OF LOCUST CREEK; THENCE SOUTH 59°26'01" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 213.67 FEET; THENCE NORTH 44°53'50" EAST ALONG THE SOUTH
BANK OF SAID CREEK A DISTANCE OF 217.05 FEET; THENCE SOUTH 88°58'40" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 406.02 FEET; THENCE NORTH 64°05'43" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 396.78 FEET;
THENCE SOUTH 88°49'31" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 100.36 FEET; THENCE SOUTH 14°36'12" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 172.64 FEET; THENCE SOUTH 60°46'14" EAST ALONG THE
SOUTH BANK OF SAID CREEK A DISTANCE OF 225.00 FEET; THENCE SOUTH 73°40'27" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 121.57 FEET; THENCE SOUTH 19°07'15" EAST ALONG THE WEST BANK OF SAID CREEK A DISTANCE OF 143.44
FEET; THENCE SOUTH 33°11'50" EAST ALONG THE WEST BANK OF SAID CREEK A DISTANCE OF 287.78 FEET TO A POINT ON THE WEST BANK OF THE COOSA RIVER; THENCE SOUTHERLY ALONG THE WEST BANK OF SAID COOSA RIVER FOR THE FOLLOWING BEARINGS AND
DISTANCES: SOUTH 31°30'30" EAST, 363.96 FEET; SOUTH 35°32'33" EAST, 475.09 FEET; SOUTH 24°58'25" EAST, 465.35 FEET; SOUTH 29°56'42" EAST, 337.54 FEET; SOUTH 16°38'07" EAST, 698.94 FEET; SOUTH
07°58'51" EAST, 405.89 FEET; SOUTH 09o09'-29' EAST, 539.08 FEET; SOUTH' 11°18'37" EAST, 559.69 FEET; SOUTH 23°32'15" WEST, 813.59 FEET; SOUTH 22°31 '30" WEST, 802.31 FEET; SOUTH 11°54'33"
WEST, 630.32 FEET; SOUTH 04°36'19"  WEST,  482.98 FEET; SOUTH 09°09'29" EAST, 397.34 FEET; SOUTH  
 
  
   
 20°45'10" EAST, 571.47 FEET; SOUTH 35°57'15" EAST, 1018..U FEET; SOUTH 40°48'00" EAST, 478.69 FEET; SOUTH 31°24'11" EAST, 515.30 FEET; SOUTH
25°06'51" EAST, 580.45 FEET; SOUTH 20°59'52" EAST, 8()5.17 FEET; SOUTH 14°27'12" EAST, 565.60 FEET; SOUTH 14°17'16" EAST, 641.26 FEET; SOUTH 26°47'13" EAST, 1135.20 FEET; SOUTH 18°53'31"
EAST, 675.37 FEET; SOIITH 01°43'47" EAST, 280.10 FEET; SOUTH 17°15'35" EAST, 387.64 FEET; SOUTH 05°41'45" EAST, 249.70 FEET; SOUTH 01°10'19" WEST, 346.22 FEET; SOUTH 07°28'35" WEST, 340.37 FEET;
SOUTH 16°49'10" WEST, 277.42 FEET; SOUTH 38°17'03" WEST, 368.02 FEET; SOUTH 49°21'38" WEST, 363.42 FEET; SOUTH 50°05'28" WEST, 332.96 FEET; SOUTH 56°41'29" WEST, 385.46 FEET; SOUTH
61°36'41" WEST, 367.02 FEET TO ITS POINT OF INTERSECTION WITH THE EASTERLY RIGHT-OF-WAY LINE OF THE CENTRAL OF GEORGIA RAILROAD RIGHT-OF-WAY; THENCE NORTH 22°07'08" WEST ALONG THE EAST RIGHT-OF-WAY LINE OF SAID RAILROAD
RIGHT-OF-WAY A DISTANCE OF 11980.03 FEET TO THE P.C. OF A CONCAVE CURVE LEFT; THENCE, ALONG SAID EAST RAILROAD RIGHT-OF-WAY, ALONG A CURVE TO THE LEFT WITH A RADIUS OF 4991.53 FEET A CHORD BEARING OF NORTH 25°01 '51" WEST A CHORD DISTANCE
OF 722.06 FEET TO THE P.T. OF SAID CURVE; THENCE ALONG SAID EAST RAILROAD RIGHT-OF-WAY, NORTH 29°10'43" WEST A DISTANCE OF 2599.18 FEET TO A POINT ON THE SOUTHEASTERLY RIGHT-OF-WAY LINE OF A SHELBY COUNTY PAVED ROAD THENCE, ALONE; THE
SOUTHEASTERLY RIGHT-OF-WAY LINE OF SAID ROAD NORTH 35°56'58" EAST A DISTANCE OF 270.48 FEET TO A FOUND IRON PIN; THENCE NORTH 88°58'54" EAST A DISTANCE OF 248.39 FEET TO A FOUND IRON PIN; THENCE NORTH 84°35'21" EAST A
DISTANCE OF 782.78 FEET TO A FOUND IRON PIN, SAID PIN BEING NORTH 00°20'18" WEST OF AND 180.02 FEET FROM THE SOUTHWEST CORNER OF THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SAID SECTION 31, TOWNSHIP 19 SOUTH, RANGE 3 EAST,
SHELBY COUNTY, ALABAMA; THENCE NORTH 00°24'33" WEST ALONG THE WEST BOUNDARY OF SAID NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SAID SECTION A DISTANCE OF 1104.13 FEET TO FOUND CONCRETE MONUMENT LOCATED ON THE SOUTH BOUNDARY OF A
DIRT ROAD; THENCE, ALONG THE SOUTH BOUNDARY OF SAID DIRT ROAD SOUTH 85°31'31" EAST A DISTANCE OF 187.77 FEET; THENCE, ALONG THE SOUTH BOUNDARY OF SAID DIRT ROAD, NORTH 87°58'52" EAST A DISTANCE OF 91.63 FEET; THENCE, ALONG THE
SOUTH BOUNDARY OF SAID DIRT ROAD, NORTH 68°26'52" EAST A DISTANCE OF 88.72 FEET; THENCE, ALONG THE SOUTH BOUNDARY OF SAID DIRT ROAD, NORTH 59°58'33" EAST A DISTANCE OF 148.44 FEET TO ITS POINT OF INTERSECTION WITH THE NORTH
BOUNDARY OF SAID QUARTER-QUARTER SECTION; THENCE NORTH 87°33'19" EAST ALONG THE NORTH BOUNDARY OF SAID NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SAID SECTION A DISTANCE OF 848.86 FEET TO THE POINT-OF-BEGINNING.  

  
  THE ABOVE DESCRIBED LAND IS LOCATED IN THE SOUTHIEAST ONE-FOURTH OF THE NORTHWEST ONE-FORTH, THE SOUTHWEST ONE-FOURTH OF
THE NORTHEAST ONE-FORTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE
SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 31, TOWNSHIP 19 SOUTH, RANGE 3 EAST; THE NORTHEAST ONE-FOURTH OF THE
SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 36, TOWNSHIP 19 SOUTH, RANGE 2 EAST, SHELBY COUNTY, ALABAMA; THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION I, TOWNSHIP 20 SOUTH, RANGE 2 EAST,
SHELHY COUNTY, ALABAMA; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH; THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE
SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH; SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH AND THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE
SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND
SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 6, TOWNSHIP 20 SOUTH, RANGE 3 EAST, SHELBY COUNTY, ALABAMA, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST
ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHEAST
ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE- FOURTH  OF  THE  SOUTHEAST  ONE-FOURTH  OF  SECTION 7, TOWNSHIP  20
 SOUTH,  RANGE  3  EAST;  THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH  AND THE  SOUTHWEST  ONE-FOURTH  OF THE  SOUTHWEST
 ONE-FOURTH  OF  SECTION  8,  TOWNSHIP  20 SOUTH,  RANGE 3  EAST;  THE NORTHWEST ONE-FOURTH  OF   THE   NORTHWEST   ONE-FOURTH    AND
   THE    SOUTHWEST   ONE-
 
   
  FOURTH OF THE NORTHWEST ONE-FOURTH OF
SECTION 17, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH AND THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION 18 , TOWNSHIP 20 SOUTH, RANGE
3 EAST, SHELBY COUNTY, ALABAMA, SAID PROPERTY CONTAINING 1062.25 ACRES MORE OR LESS.  
  
    
  COOSA PINES  
  REAL PROPERTY - LEASEHOLD
 
   
  LEGAL DESCRIPTION    
  TRACT NO. 1     
  COMMENCE AT THE SOUTHEAST CORNER OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THENCE NORTH 00°01'14" WEST ALONG THE
EAST BOUNDARY OF SAID SECTION A DISTANCE OF 0435.45 FEET TO THE POINT-OF-BEGINNING. FROM THE POINT-OF-BEGINNING; THENCE SOUTH 88°37'51" WEST FOR A DISTANCE OF 3904.74 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 00°18'01" EAST
A DISTANCE OF 685.74 FEET TO A POINT ON THE EAST RIGHT-OF-WAY LINE OF ALABAMA NO. 235; THENCE, ALONG SAID EAST RIGHT-OF-WAY LINE, NORTH 51°57'00" WEST A DISTANCE OF 313.76 FEET TO THENCE OF A CONCAVE CURVE RIGHT; THENCE, CONTINUING ON SAID
EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE RIGHT WITH A RADIUS OF 1372.40 FEET, A CHORD BEARING OF NORTH 304°41'39" WEST A CHORD DISTANCE OF 985.90 FEET TO A FOUND IRON PIN; THENCE, LEAVING SAID EAST RIGHT-OF-WAY NORTH 85°52'31"
EAST A DISTANCE OF 228.05 FEET TO A SET IRON PIN; THENCE NORTH 00°07'30" WEST A DISTANCE OF 325.60 FEET TO A SET IRON PIN; THENCE SOUTH 85°49'28" WEST A DISTANCE OF 267.50 FEET TO FOUND IRON PIN ON THE EAST RIGHT-OF-WAY LINE OF
SAID ALABAMA HIGHWAY NO. 235; THENCE, ALONG SAID EAST RIGHT-OF-WAY LINE NORTH 00°14'28" WEST A DISTANCE OF 564.88 FEET TO THE P.C. OF A CONCAVE CURVE LEFT; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE LEFT WITH A
RADIUS OF 1987.73 FEET, A CHORD BEARING OF NORTH 09°49'18" WEST A CHORD DISTANCE OF 658.42 FEET TO THE P.T. OF SAID CURVE; THENCE CONTINUING ON SAID EAST RIGHT-OF-WAY , NORTH 15°25'13" WEST A DISTANCE OF 1240.12 FEET TO THE P.C
OF A CONCAVE CURVE RIGHT; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE RIGHT WITH A RADIUS OF 1848.50 FEET, A CHORD BEARING OF NORTH 06°48'36" WEST A CHIORD DISTANCE OF 553.50 FEET TO THE P.T. OF SAID CURVE;
THENCE, CONTINUING ON SAID EAST RIGIIT-OF-WAY, NORTH 00°07'17" EAST A DISTANCE OF 1267.14 FEET TO THE P.C OF A CONCAVE CURVE RIGHT; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE RIGHT WITH A RADIUS OF 1372.39 FEET,
A CHORD BEARING OF NORTH 14°38'49" EAST A CHORD DISTANCE OF 755.96 FEET TO THE P.T. OF SAID CURVE; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, NORTH 29°33'44" EAST A DISTANCE OF 268.30 FEET TO A FOUND CONCRETE MONUMENT AT THE
P.C OF A CONCAVE CURVE LEFT; THENCE, CONTINUING ON SAID EAST RIGHT-OF-WAY, ALONG SAID CURVE TO THE LEFT WITH A RADIUS OF 1454.47 FEET, A CHORD BEARING OF NORTH 21°25'25" EAST A CHORD DISTANCE OF 344.27 FEET TO A FOUND IRON PIN; THENCE,
LEAVING  SAID  EAST  RIGHT-OF-WAY,  SOUTH  89°58'46" EAST A DISTANCE OF 37.39  
 
  
     FEET TO A SET IRON PIN; THENCE SOUTH 00°05'43" WEST A DISTANCE OF 310.00 FEET TO A POINT; THENCE NORTH 90°00'00" EAST A DISTANCE OF 248.00 FEET TO A POINT THAT IS 12
FEET NORTH OF AND AT RIGHT ANGLES TO THE CENTERLIN OF A RAILROAD SPUR TRACK; THENCE NORTH 64°35'03" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 135.91 FEET; THENCE NORTH 67°25'24" EAST PARALLEL TO
AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 66.23 FEET; THENCE NORTH 76°00'26" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 73.18 FEET; THENCE NORTH 85°31'37" EAST PARALLEL TO AND
12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 90.35 FEET; THENCE NORTH 85°03'20" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 79.70 FEET; THENCE NORTH 74°19'35" EAST PARALLEL TO AND 12
FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 101.92 FEET; THENCE NORTH 62°21 '50" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 89.57 FEET; THENCE NORTH 51°10'37" EAST PARALLEL TO AND 12
FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 113.83 FEET; THENCE NORTH 39°46'49" EAST PARALLEL TO AND 12 FEET NORTH OF SAID RAILROAD SPUR TRACK A DISTANCE OF 49.10 FEET TO SET IRON PIN; THENCE NORTH 00°00'46" EAST A
DISTANCE OF 316.39 FEET TO A SET IRON PIN; THENCE NORTH 89°59'12" WEST A DISTANCE OF 958.84 FEET TO A FOUND CONCRETE MONUMENT ON THE EAST RIGHT-OF-WAY LINE OF SAID ALABAMA HIGHWAY 235; THENCE, ALONG SAID EAST RIGHT-OF-WAY, ALONG A CURVE TO
THE LEFT WITH A RADIUS OF 958.05 FEET, A CHORD BEARING OF NORTH 02°36'11" EAST A CHORD DISTANCE OF 42.53 FEET TO A FOUND CONCRETE MONUMENT; THENCE, LEAVING SAID EAST RIGHT-OF-WAY, NORTH 89°54'55" EAST A DISTANCE 985.00 FEET TO A
SET IRON PIN; THENCE SOUTH 80°05'41" EAST A DISTANCE OF 250.00 FEET TO A SET IRON PIN; THENCE SOUTH 25°26'11" EAST A DISTANCE OF 39.28 FEET TO A FENCE CORNER; THENCE SOUTH 49°17'11" EAST A DISTANCE OF 120.95 FEET TO A
FOUND CONCRETE MONUMENT; THENCE SOUTH 64°56'35" EAST A DISTANCE OF 151.58 FEET TO A FOUND CONCRETE MONUMENT; THENCE NORTH 89°59'26" EAST A DISTANCE OF 109.96 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 00°05'23"
EAST A DISTANCE OF 119.99 FEET TO A FOUND CONCRETE MONUMENT; THENCE NORTH 89°54'01" EAST A DISTANCE OF 10504.30 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 30°04'34" EAST A DISTANCE OF 1589.89 FEET TO A FOUND CONCRETE
MONUMENT; THENCE SOUTH 46°24'37" WEST A DISTANCE OF 1043.84 F~ET TO FOUND IRON PIN; THENCE SOUTH 46°15'58" WEST A DISTANCE OF 2344.35 FEET TO A FOUND IRON PIN; THENCE SOUTH 63°32'16" WEST A DISTANCE OF 3427.78 FEET TO A
FOUND CONCRETE MONUMENT, SAID POINT BEING LOCATED ON THE EAST BOUNDARY OF THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 4, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THENCE  SOUTH 00°14'33"
 EAST  ALONG  THE  EAST  BOUNDARY  OF    SAID  
  
    
  QUARTER-QUARTER SECTION FOR A DISTANCE OF 759.27 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 88°37'51" WEST A DISTANCE OF 2630.64 FEET TO THE POINT-OF-BEGINNING.    
  THE ABOVE DESCRIBED LAND IS LOCATED IN THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE
SOUTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 32, TOWNSHIP 19 SOUTH, RANGE 3 EAST; THE SOUTHWEST
ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 33, TOWNSHIP 19 SOUTH, RANGE 3
EAST; THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 34, TOWNSHIP 19 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE
NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE
SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST
ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHEAST
ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH AND THE NORTHEAST ONE-FOURTH OF THE NORTHWEST
ONE-FOURTH OF SECTION 8, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF
THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST
   ONE-FOURTH,   THE   NORTHWEST    ONE-FOURTH   OF    THE  
 
  SOUTHWEST ONE-FOURTH, THE
NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOIIRTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOlIlH'1I OF THE SOUTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE
SOUTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 4, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST
ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH AND THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 3, TOWNSHIP 20 SOUTH, RANGE 3
EAST, TALLADEGA COUNTY, ALABAMA, AND CONTAINS 1519.43 ACRES MORE OR LESS.    
  TRACT NO.2     
  COMMENCE AT THE SOUTHEAST CORNER OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST, 'I'ALLADEGA COUNTY, ALABAMA; THENCE NORTH 00°01'14" WEST ALONG THE EAST BOUNDARY OF SAID SECTION A DISTANCE OF
435.45 FEET; THENCE SOUTH 88°37'51" WEST A DISTANCE OF 3904.74 FEET TO A FOUND CONCRETE MONUMENT; THENCE SOUTH 00°18'01" EAST A DISTANCE OF 685.74 FEET TO A POINT ON THE EAST RIGHT-OF-WAY LINE OF ALABAMA HIGHWAY 235; THENCE SOUTH
15°19'07" WEST A DISTANCE OF 130.11 FEET TO A P.T. ON THE WEST RIGHT-OF-WAY LINE OF SAID HIGHWAY, SAID POINT BEING THE POINT-OF-BEGINNING FROM SAID POINT-OF-BEGINNING, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE RIGHT WITH A RADIUS
OF 2907.08 FEET, A CHORD BEARING OF SOUTH 46°50'20" EAST A CHORD DISTANCE OF 363.13 FEET TO A FOUND CONCRETE MONUMENT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, SOUTH 16°47'50" EAST A DISTANCE OF 102.00 FEET TO A POINT, SAID POINT
BEING THE P.C. OF A CONCAVE CURVE RIGHT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE RIGHT WITH A RADIUS OF 1266.43 FEET, A CHORD BEARING OF SOUTH 30°31'54" EAST A CHORD DISTANCE OF 360.99 FEET TO A POINT BEING THE P.C.C. OF
A CONCAVE CURVE RIGHT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE RIGHT WITH A RADIUS OF 1373.05 FEET, A CHORD BEARING OF SOUTH 04°23'57" EAST A CHORD DISTANCE OF 901.30 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID
WEST RIGHT-OF-WAY, SOUTH 14°50'27" WEST A DISTANCE 0.1' 270.16 FEET TO ITS POINT OF INTERSECTION WITH THE NORTHERLY BANK OF TALLADEGA CREEK, THENCE, LEAVING SAID WEST RIGHT-OF-WAY NORTH 82°02'05" WEST ALONG THE NORTHERLY BANK OF
SAID CREEK A DISTANCE OF 955.11 FEET;  THENCE  NORTH 89°22'49"  WEST ALONG  THE NORTHERLY      BANK  
  
    
  OF SAID CREEK A DISTANCE OF 393.55 FEET; THENCE SOUTH 67°21'42" WEST ALONG THE NORTHERLY BANK OF SAID CREEK A DISTANCE
OF 145.25 FEET TO ITS POINT OF INTERSECTION WITH THE EAST BANK OF THE COOSA RIVER; THENCE NORTH 11°09'16" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 218.25 FEET; THENCE NORTH 18°43'47" WEST ALONG THE EAST BANK OF SAID
RIVER A DISTANCE OF 545.19 FEET; THENCE NORTH 23°17'47" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 809.60 FEET; THENCE NORTH 33°28'31" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 923.89 FEET; THENCE NORTH
38°40'43" WEST ALONG; THE EAST BANK OF SAID RIVER A DISTANCE OF 1096.84 FEET; THENCE NORTH 28°58'02" WEST ALONG; THE EAST BANK OF SAID RIVER A DISTANCE OF 484.20 FEET; THENCE NORTH 17°34'17" WEST ALONG THE EAST BANK OF
SAID RIVER A DISTANCE OF 373,45 FEET; THENCE NORTH 00°38'39" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 401.12 FEET; THENCE NORTH 09°34'23" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 406.75 FEET; THENCE NORTH
14°32'05" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 1024.24 FEET; THENCE NORTH 22°45'53" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 606.03 FEET; THENCE NORTH 30°13'12" EAST ALONG THE EAST BANK OF
SAID RIVER A DISTANCE OF 349.43 FEET; THENCE NORTH 18°26'48" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 641.35 FEET; THENCE NORTH 02°51 '52" EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 360.98 FEET; THENCE NORTH
09°33'20" WEST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 498.13 FEET; THENCE SOUTH 89°19'26" WEST ALONG THE BANK OF THE RIVER AND ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 57.62 FEET; THENCE NORTH
00°07'03" EAST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 37.57 FEET; THENCE NORTH 88°50'36" WEST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 29.08 FEET; THENCE NORTH 00°18'41" WEST ALONG THE EDGE OF
THE RIVER PUMP HOUSE A DISTANCE OF 31.47 FEET; THENCE NORTH 89°54'13" EAST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 27.94 FEET; THENCE NORTH 00°06'59" EAST ALONG THE EDGE OF THE RIVER PUMP HOUSE A DISTANCE OF 38.37
FEET; THENCE NORTH 19°33'01 EAST ALONG THE EAST BANK OF SAID RIVER A DISTANCE OF 112.60 FEET TO A FOUND IRON PIN; THENCE, LEAVING SAID RIVER, NORTH 89°51'15" EAST A DISTANCE OF 400.08 FEET TO A FOUND IRON PIN; THENCE SOUTH
03°31'19" EAST A DISTANCE OF 601.42 FEET TO A SET IRON PIN; THENCE NORTH 85°05' 19" EAST A DISTANCE OF 363.93 FEET TO A FOUND IRON PIN ON THE WEST RIGHT-OF-WAY OF SAID ALABAMA HIGHWAY NO. 235; THENCE, ALONG SAID WEST
RIGHT-OF-WAY, ALONG A CURVE TO THE RIGHT WITH A RADIUS OF 1492.39 FEET, A CHORD BEARING OF SOUTH 03°06'52" WEST A CHORD DISTANCE OF 228.69 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID WEST RIGHT-OF-WAY, SOUTH 00°07'17" WEST
TO THE P.C. OF A CONCAVE CURVE TO THE LEFT; THENCE,  ALONG  SAID  WEST  RIGHT-OF-WAY,  ALONG   A CURVE TO THE  
 
  
     LEFT WITH A RADIUS OF 1968.50 FEET, A CHORD BEARING OF SOUTH 06°50'09" EAST A CHORD DISTANCE OF 587.66 FEET TO THE P.T. OF
SAID CURVE; THENCE. ALONG SAID WEST RIGHT-OF-WAY, SOUTH 15°25'13" EAST A DISTANCE OF 1244.31 FEET TO THE P.C. A CONCAVE CURVE TO THE RIGHT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE RIGHT WITH A RADIUS OF 1867.73 FEET, A
CHORD BEARING OF SOUTH 09°53'02" EAST A CHORD DISTANCE OF 622.67 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID WEST RIGHT-OF-WAY, SOUTH 00o14'28" EAST A DISTANCE OF 564.88 FEET TO THE P.C. OF A CONCAVE CURVE TO THE
LEFT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG A CURVE TO THE LEFT WITH A RADIUS OF 1492.40 FEET, A CIIORD BEARING OF SOUTH 27°48'34" EAST A CHORD DISTANCE OF 1387.36 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG SAID WEST RIGHT-OF-WAY,
SOUTH 51°57'00" EAST A DISTANCE OF 363.16 FEET TO THE POINT-OF-BEGINNING.    
  THE ABOVE DESCRIBED LAND IS LOCATED IN THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST
ONE-FOURTH OF SECTION 31, TOWNSHIP 19 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH,
THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION 6, TOWNSHIP 20
SOUTH, RANGE 3 EAST; THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST AND THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF
THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH OF SECTION 8, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE
NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION 7, TOWNSHIP 20 SOUTH, RANGE 3 EAST AND CONTAINS 274.86 ACRES MORE OR LESS.      
  TRACT NO.3     
  COMMENCE AT THE SOUTHEAST CORNER OF SECTION 5, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA; THENCE
SOUTH 55°24'14" WEST A DISTANCE OF 4238.27 FEET TO A POINT OF INTERSECTION BETWEEN THE WEST RIGHT-OF-WAY OF ALABAMA HIGHWAY NO. 235 AND THE SOUTH BANK OF TALLADEGA CREEK,  SAID POINT  BEING  THE POINT-OF-BEGINNING.
 FROM  SAID  POINT-OF-  
 
  
     BEGINNING, THENCE,
ALONG SAID WEST RIGHT-OF-WAY, SOUTH 14°50'27" WEST A DISTANCE OF 296.71 FEET TO THE P.C. OF A CONCAVE CURVE LEFT; THENCE, ALONG SAID WEST RIGHT-OF-WAY, ALONG; A CURVE TO THE LEFT WITH A RADIUS OF 1716.24 FEET, A CHORD BEARING OF SOUTH
04°06'31" EAST A CHORD DISTANCE OF 1114.63 FEET TO THE P.T. OF SAID CURVE; THENCE, ALONG; SAID WEST RIGHT-OF-WAY, SOUTH 20°38'30" EAST A DISTANCE OF 7.40 FEET TO ITS POINT OF INTERSECTION WITH THE SOUTH BOUNDARY OF AN ALABAMA
POWER COMPANY TRANSMISSION LINE RIGHT-OF-WAY; THENCE SOUTH 66°52'56" WEST ALONG THE SOUTH BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-OF-WAY A DISTANCE OF 357.06 FEET TO A POINT ON THE NORMAL POOL ELEVATION OF LAY LAKE; THENCE NORTH
21°38'43" EAST ALONG; THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 140.84 FEET TO A POINT ON THE NORTH BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-OF-WAY; THENCE NORTH 04°03'08" WEST ALONG THE NORMAL POOL ELEVATION OF
SAID LAKE A DISTANCE OF 514.78 FEET; THENCE NORTH 67°50'50" WEST ALONG THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 62.84 FEET; THENCE SOUTH 02°18'13" WEST ALONG THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 429.05
FEET; THENCE SOUTH 26°04'08" WEST ALONG THE NORMAL POOL ELEVATION OF SAID LAKE A DISTANCE OF 219.84 FEET TO ITS POINT OF INTERSECTION WITH THE NORTH BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-OF-WAY; THENCE SOUTH 66°52'54" WEST
ALONG THE NORTH BOUNDARY OF SAID ALABAMA POWER COMPANY RIGHT-OF-WAY AND ALONG THE NORMAL POOL ELEVATION OF SAID LAY LAKE A DISTANCE OF 333.54 FEET TO ITS POINT OF INTERSECTION WITH THE EAST BANK OF THE COOSA RIVER; THENCE NORTH 24°59'29"
WEST ALONG THE EAST BOUNDARY OF SAID COOSA RIVER A DISTANCE OF 545.38 FEET; THENCE NORTH 23°23'23" WEST ALONG THE EAST BOUNDARY OF SAID COOSA RIVER A DISTANCE OF 450.66 FEET; THENCE NORTH 15°04'42" WEST ALONG THE EAST BANK OF
SAID COOSA RIVER A DISTANCE OF 522.07 FEET; THENCE NORTH 06°38'59" WEST ALONG THE EAST BANK OF SAID COOSA RIVER A DISTANCE OF 223.39 FEET TO ITS POINT OF INTERSECTION WITH THE SOUTH BANK OF THE AFOREMENTIONED TALLADEGA CREEK; THENCE NORTH
46°21'05" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 131.09 FEET; THENCE NORTH 83°08'27" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 234.50 FEET; THENCE SOUTH 81°37'09" EAST ALONG THE SOUTH BANK OF
SAID CREEK A DISTANCE OF 576.06 FEET; THENCE SOUTH 85°47'43" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 459.84 FEET TO THE POINT-OF-BEGINNING.    
  THE ABOVE DESCRIBED LAND IS LOCATED IN THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH   OF   THE   SOUTHWEST
  ONE-FOURTH    AND   THE    NORTHEAST  
  
    
  ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 8, TOWNSHIP 20 SOUTH, RANGE 3 EAST, TALLADEGA COUNTY, ALABAMA, AND CONTAINS 37.68 ACRES MORE OR LESS.  
 

    
  EXHIBIT "B"  
     
  LEGAL DESCRIPTION OF THE TRACT LOCATED IN  
  SHELHY COUNTY, ALABAMA  
  THAT IS HEREBY DELETED FROM
THE MORTGAGE  
     
  TRACT NO.4     
  COMMENCE AT THE NORTHEAST CORNER OF THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 31, TOWNSHIP 19 SOUTH, RANGE 3 EAST, SHELBY COUNTY, ALABAMA, SAID POINT BEING THE
POINT-OF-BEGINNING FROM SAID POINT-OF-BEGINNING NORTH 01°20'25" WEST ALONG THE WEST BOUNDARY OF THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH A DISTANCE OF 763.60 FEET TO A POINT ON THE SOUTH BANK OF LOCUST CREEK; THENCE SOUTH
59°26'01" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 213.67 FEET; THENCE NORTH 44°53'50" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 217.05 FEET; THENCE SOUTH 88°58'40" EAST ALONG THE SOUTH BANK OF
SAID CREEK A DISTANCE OF 406.02 FEET; THENCE NORTH 64°05'43" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 396.78 FEET; THENCE SOUTH 88°49'31" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 100.36 FEET; THENCE
SOUTH 14°36'12" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 172.64 FEET; THENCE SOUTH 60°46'14" EAST ALONG THE SOUTH BANK OF SAID CREEK A DISTANCE OF 225.00 FEET; THENCE SOUTH 73°40'27" EAST ALONG THE SOUTH
BANK OF SAID CREEK A DISTANCE OF 121.57 FEET; THENCE SOUTH 19°07'15" EAST ALONG THE WEST BANK OF SAID CREEK A DISTANCE OF 143.44 FEET; THENCE SOUTH 33°11'50" EAST ALONG THE WEST BANK OF SAID CREEK A DISTANCE OF 287.78 FEET TO A
POINT ON THE WEST BANK OF THE COOSA RIVER; THENCE SOUTHERLY ALONG THE WEST BANK OF SAID COOSA RIVER FOR THE FOLLOWING BEARINGS AND DISTANCES: SOUTH 31°30'30" EAST, 363.96 FEET; SOUTH 35°32'33" EAST, 475.09 FEET; SOUTH
24°58'25" EAST, 465.35 FEET; SOUTH 29°56'42" EAST, 337.54 FEET; SOUTH 16°38'07" EAST, 698.94 FEET; SOUTH 07°58'51" EAST, 405.89 FEET; SOUTH 00°09'48" EAST, 539.08 FEET; SOUTH 11°18'37"
EAST, 559.69 FEET; SOUTH 23°32'15" WEST, 813.59 FEET; SOUTH 22°31'30" WEST, 802.31 FEET; SOUTH 11°54'33" WEST, 630.32 FEET; SOUTH 04°36'19" WEST, 482.98 FEET; SOUTH 09°09'29" EAST, 397.34 FEET; SOUTH
20°45'10" EAST, 571.47 FEET; SOUTH 35°57'15" EAST, 1018.32 FEET; SOUTH 40°48'00" EAST, 478.69 FEET; SOUTH 31°24'11" EAST, 515.30 FEET; SOUTH 25°06'51" EAST, 580.45 FEET; SOUTH 20°59'52"
EAST, 865.17 FEET; SOUTH 14°27'12" EAST, 565.60 FEET; SOUTH 14°17'16" EAST, 641.26 FEET; SOUTH 26°47'13" EAST, 1135.20 FEET; SOUTH 18°53'31" EAST, 675.37 FEET; SOUTH 01°43'47" EAST, 280.10 FEET;
SOUTH 17°15'35" EAST, 387.64 FEET; SOUTH 05°41'45" EAST, 249.70 FEET; SOUTH 01°10'19" WEST, 346.22 FEET; SOUTH 07°28'35" WEST, 340.37 FEET;  SOUTH  16°49'10"  WEST,  277.42
 FEET;  SOUTH  
  
    
  38°17'03" WEST, 368.02
FEET; SOUTH "9°21 '38" WEST, 363."2 FEET; SOUTH 50°05'28" WEST, 332.96 FEET; SOUTH 56°41'29" WEST, 385.46 FEET; SOUTH 61°36'''1'' WEST, 367.02 FEET TO ITS POINT OF INTERSECTION WITH THE EASTERLY
RIGHT-OF-WAY LINE OF THE CENTRAL OF GEORGIA RAILROAD RIGHT-OF-WAY; THENCE NORTH 22°07'08" WEST ALONG; THE EAST RIGHT-OF-WAY LINE OF SAID RAILROAD RIGHT-OF-WAY A DISTANCE OF 11980.03 FEET TO THE P.C. OF A CONCAVE CURVE LEFT; THENCE, ALONG
SAID EAST RAILROAD RIGHT-OF-WAY, ALONG A CURVE TO THE LEFT WITH A RADIUS OF 4991.53 FEET A CHORD BEARING; OF NORTH 25°01 '51" WEST A CHORD DISTANCE OF 722.06 FEET TO THE P.T. OF SAID CURVE; THENCE ALONG SAID EAST RAILROAD RIGHT-OF-WAY,
NORTH 29°10'''3'' WEST A DISTANCE OF 2599.18 FEET TO A POINT ON THE SOUTHEASTERLY RIGHT-OF-WAY LINE OF A SHELBY COUNTY PAVED ROAD; THENCE, ALONG THE SOUTHEASTERLY RIGHT-OF-WAY LINE OF SAID ROAD NORTH 35°56'58" EAST A DISTANCE OF
270.48 FEET TO A FOUND IRON PIN; THENCE NORTH 88°58'54" EAST A DISTANCE OF 2"8.39 FEET TO A FOUND IRON PIN; THENCE NORTH 84°35'21" EAST A DISTANCE OF 782.78 FEET TO A FOUND IRON PIN, SAID PIN BEING; NORTH 00°20'18"
WEST OF AND 180.02 FEET FROM THE SOUTHWEST CORNER OF THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SAID SECTION 31, TOWNSHIP 19 SOUTH, RANGE 3 EAST, SHELBY COUNTY, ALABAMA; THENCE NORTH 00°24'33" WEST ALONG THE WEST BOUNDARY OF
SAID NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SAID SECTION A DISTANCE OF 1104.13 FEET TO FOUND CONCRETE MONUMENT LOCATED ON THE SOUTH BOUNDARY OF A DIRT ROAD; THENCE, ALONG THE SOUTH BOUNDARY OF SAID DIRT ROAD SOUTH 85°31 '31"
EAST A DISTANCE OF 187.77 FEET; THENCE, ALONG THE SOUTH BOUNDARY OF SAID DIRT ROAD, NORTH 87°58'52" EAST A DISTANCE OF 91.63 FEET; THENCE, ALONG THE SOUTH BOUNDARY OF SAID DIRT ROAD, NORTH 68°26'52" EAST A DISTANCE OF 88.72 FEET;
THENCE, ALONG THE SOUTH BOUNDARY OF SAID DIRT ROAD, NORTH 59°58'33" EAST A DISTANCE OF 148.44 FEET TO ITS POINT OF INTERSECTION WITH THE NORTH BOUNDARY OF SAID QUARTER-QUARTER SECTION; THENCE NORTH 87°33'19" EAST ALONG THE NORTH
BOUNDARY OF SAID NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SAID SECTION A DISTANCE OF 848.86 FEET TO THE POINT-OF-BEGINNING.    
  THE ABOVE DESCRIBED LAND IS
LOCATED IN THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST
ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF  THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH  OF
  THE  SOUTHEAST  ONE-FOURTH  OF  SECTION  31, TOWNSHIP  
 
  
     19 SOUTH RANGE 3 EAST; THE NORTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF SECTION 36, TOWNSHIP 19 SOUTH, RANGE 2 EAST. SHELBY COUNTY. ALABAMA;
THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION I, TOWNSHIP 20 SOUTH, RANGE 2 EAST, SHELBY COUNTY. ALABAMA; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST
ONE-FOURTH OF THE NORTHEAST ONE-FOURTH; THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH. THE SOUTHEAST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH; SOUTHWEST ONE-FOURTH OF THE NORTHEAST
ONE-FOURTH AND THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH. THE NORTHEAST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHEAST
ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND SOUTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH OF S.:CTION 6, TOWNSHIP 20 SOUTH, RANGE 3 EAST, SHELBY COUNTY, ALABAMA, THE NORHEAST ONE-FOURTH OF THE
NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, SOUTHEAST
ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHEAST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH, THE SOUTHWEST ONE-FOURTH OF THE SOUTHEAST ONE-FOURTH AND THE SOUTHEAST ONE-FOURTH OF THE SOUTHEAST
ONE-FOURTH OF SECTION 7, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH, THE NORTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE SOUTHWEST ONE-FOURTH OF SECTION 8, TOWNSHIP 20
SOUTH, RANGE 3 EAST; THE NORTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH AND THE SOUTHWEST ONE-FOURTH OF THE NORTHWEST ONE-FOURTH OF SECTION 17, TOWNSHIP 20 SOUTH, RANGE 3 EAST; THE NORTHEAST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH, THE SOUTHEAST
ONE-FOURTH OF THE NORTHEAST ONE-FOURTH AND THE NORTHWEST ONE-FOURTH OF THE NORTHEAST ONE-FOURTH OF SECTION 18 , TOWNSHIP 20 SOUTH, RANGE 3 EAST, SHELBY COUNTY, ALABAMA, SAID PROPERTY CONTAINING 1062.25 ACRES MORE OR LESS.Exhibit 10.79

  Exhibit 10.79
  
  
 
 
 SENIOR SECURED SUPERPRIORITY DEBTOR IN POSSESSION
CREDIT AGREEMENT 
 dated as of April 21, 2009 
 by and among
ABITIBIBOWATER INC., BOWATER INCORPORATED and BOWATER CANADIAN
FOREST PRODUCTS INC., 
 as
Debtors and Debtors in Possession,
as Borrowers, 
 the Lenders from time to time party hereto, 
 and 
 FAIRFAX FINANCIAL HOLDINGS LTD. 
 as
Initial Lender, Initial Administrative Agent and Initial Collateral Agent 
 
 
 
 
 

  

  
 
  
 
 
	 	 	 	 	 	 	 
	TABLE OF CONTENTS
	 	 	 	 	Page	 
	 ARTICLE I

	 	 	  
	 	 	 	 
	 DEFINITIONS

	 	 	  
	 	 	 	 
	SECTION 1.01.	 	 Certain Defined Terms
	 	 	3	 
	SECTION 1.02.	 	 Interpretation
	 	 	23	 
	 	 	  
	 	 	 	 
	 ARTICLE II

	 	 	  
	 	 	 	 
	 THE FACILITY

	 	 	  
	 	 	 	 
	SECTION 2.01.	 	 The Facility
	 	 	23	 
	SECTION 2.02.	 	 Repayment of the Advances
	 	 	23	 
	SECTION 2.03.	 	 Voluntary Prepayment of the Advances
	 	 	24	 
	SECTION 2.04.	 	 Mandatory Prepayment of the Advances
	 	 	24	 
	SECTION 2.05.	 	 Scheduled Interest
	 	 	24	 
	SECTION 2.06.	 	 Conversion of Advances
	 	 	24	 
	SECTION 2.07.	 	 Default Interest
	 	 	25	 
	SECTION 2.08.	 	 Payments and Computations; Additional Amounts
	 	 	25	 
	SECTION 2.09.	 	 Evidence of Debt
	 	 	26	 
	SECTION 2.10.	 	 Incremental Facility; ABL Facility
	 	 	26	 
	SECTION 2.11.	 	 Use of Proceeds
	 	 	28	 
	SECTION 2.12.	 	 Fees
	 	 	28	 
	SECTION 2.13.	 	 Increased Costs, Etc.
	 	 	29	 
	SECTION 2.14.	 	 Taxes
	 	 	29	 
	SECTION 2.15.	 	 Sharing of Payments, Etc.
	 	 	31	 
	 	 	  
	 	 	 	 
	 ARTICLE III

	 	 	  
	 	 	 	 
	 CONDITIONS TO EFFECTIVENESS

	 	 	 	 	 	 	 
	SECTION 3.01.	 	 Conditions Precedent to the Closing Date
	 	 	31	 

 
 
 

  

  
 
  
 
	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	SECTION 3.02.	 	 Conditions Precedent to each Borrowing
	 	 	33	 
	 	 	  
	 	 	 	 
	 ARTICLE IV

	 	 	  
	 	 	 	 
	 REPRESENTATIONS AND WARRANTIES

	 	 	  
	 	 	 	 
	SECTION 4.01.	 	 Representations and Warranties of the Credit Parties
	 	 	34	 
	 	 	  
	 	 	 	 
	 ARTICLE V

	 	 	  
	 	 	 	 
	 COVENANTS OF THE CREDIT PARTIES

	 	 	  
	 	 	 	 
	SECTION 5.01.	 	 Affirmative Covenants
	 	 	37	 
	SECTION 5.02.	 	 Negative Covenants
	 	 	43	 
	SECTION 5.03.	 	 Reporting Requirements
	 	 	51	 
	SECTION 5.04.	 	 Financial Covenants
	 	 	54	 
	 	 	  
	 	 	 	 
	 ARTICLE VI

	 	 	  
	 	 	 	 
	 GUARANTY

	 	 	  
	 	 	 	 
	SECTION 6.01.	 	 Guaranty; Limitation of Liability
	 	 	55	 
	SECTION 6.02.	 	 Guaranty Absolute
	 	 	56	 
	SECTION 6.03.	 	 Waivers and Acknowledgments
	 	 	57	 
	SECTION 6.04.	 	 Subrogation
	 	 	57	 
	SECTION 6.05.	 	 Guaranty Supplements
	 	 	58	 
	SECTION 6.06.	 	 Subordination
	 	 	58	 
	SECTION 6.07.	 	 Continuing Guaranty; Assignments
	 	 	59	 
	 	 	  
	 	 	 	 
	 ARTICLE VII

	 	 	  
	 	 	 	 
	 EVENTS OF DEFAULT

	 	 	  
	 	 	 	 
	SECTION 7.01.	 	 Events of Default
	 	 	59	 
	 	 	  
	 	 	 	 
	 ARTICLE VIII

	 	 	  
	 	 	 	 
	 THE AGENTS

	 	 	  
	 	 	 	 
	SECTION 8.01.	 	 Authorization and Action
	 	 	62	 
	SECTION 8.02.	 	 Agents Individually
	 	 	63	 

 
ii 
 

  

  
 
  
 
	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	SECTION 8.03.	 	 Duties of Agents; Exculpatory Provisions
	 	 	64	 
	SECTION 8.04.	 	 Reliance by Agents
	 	 	64	 
	SECTION 8.05.	 	 Delegation of Duties
	 	 	65	 
	SECTION 8.06.	 	 Resignation and Replacement of Agents
	 	 	65	 
	SECTION 8.07.	 	 Non-Reliance on Agents and Other Lenders
	 	 	66	 
	SECTION 8.08.	 	 Indemnification
	 	 	66	 
	 	 	  
	 	 	 	 
	 ARTICLE IX

	 	 	  
	 	 	 	 
	 SECURITY

	 	 	  
	 	 	 	 
	SECTION 9.01.	 	 Grant of Security
	 	 	67	 
	SECTION 9.02.	 	 Rights of Lender; Limitations on Lenders' Obligations
	 	 	70	 
	SECTION 9.03.	 	 The Collateral Agent's Duties
	 	 	70	 
	SECTION 9.04.	 	 Remedies
	 	 	71	 
	SECTION 9.05.	 	 Release; Termination
	 	 	71	 
	 	 	  
	 	 	 	 
	 ARTICLE X

	 	 	  
	 	 	 	 
	 MISCELLANEOUS

	 	 	  
	 	 	 	 
	SECTION 10.01.	 	 Amendments, Etc.
	 	 	71	 
	SECTION 10.02.	 	 Notices, Etc
	 	 	72	 
	SECTION 10.03.	 	 No Waiver; Remedies
	 	 	73	 
	SECTION 10.04.	 	 Costs, Fees and Expenses
	 	 	73	 
	SECTION 10.05.	 	 Right of Set-off
	 	 	75	 
	SECTION 10.06.	 	 Binding Effect
	 	 	75	 
	SECTION 10.07.	 	 Successors and Assigns
	 	 	75	 
	SECTION 10.08.	 	 Execution in Counterparts
	 	 	76	 
	SECTION 10.09.	 	 Confidentiality; Press Releases and Related Matters
	 	 	77	 
	SECTION 10.10.	 	 Patriot Act Notice
	 	 	77	 
	SECTION 10.11.	 	 Jurisdiction, Etc
	 	 	77	 

 
iii 
 

  

  
 
  
 
	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	 
	SECTION 10.12.	 	 Governing Law
	 	 	78	 
	SECTION 10.13.	 	 WAIVER OF JURY TRIAL
	 	 	78	 

 
iv 
 

  

  
 
  
 Schedules 
 
	 	 	 	 	 
	 Schedule I 
	 	- 	 	Commitments and Lending Offices
	 Schedule II 
	 	- 	 	Guarantors
	 Schedule III 
	 	- 	 	Catawba Acre
	 Schedule 1.01(a) 
	 	- 	 	List of Officers
	 Schedule 4.01(b) 
	 	- 	 	Subsidiaries
	 Schedule 4.01(m) 
	 	- 	 	Existing Facilities
	 Schedule 5.02(a)(vii) 
	 	- 	 	Existing Liens
	 Schedule 5.02(b) 
	 	- 	 	Existing Debt
	 Schedule 5.02(h) 
	 	- 	 	Investments
	 Schedule 5.02(n) 
	 	- 	 	Sale and Lease Backs
	  
	 	 	 	 
	 Exhibits
	 	 	 	 
	  
	 	 	 	 
	 Exhibit A 
	 	- 	 	Form of Assignment and Acceptance
	 Exhibit B 
	 	- 	 	Form of Notice of Borrowing
	 Exhibit C 
	 	- 	 	Interim Order
	 Exhibit D 
	 	- 	 	Form of Initial CCAA Order
	 Exhibit E 
	 	- 	 	Form of Guaranty Supplement
	 Exhibit F 
	 	- 	 	Form of Note

 
 
 

  

  
 
  
 SENIOR SECURED
SUPERPRIORITY
DEBTOR-IN-POSSESSION CREDIT AGREEMENT 
           SENIOR SECURED SUPERPRIORITY DEBTOR IN POSSESSION CREDIT AGREEMENT
(this "Agreement"), dated as of April 21, 2009, by and among ABITIBIBOWATER INC., a Delaware corporation ("Parent"), BOWATER INCORPORATED, a Delaware corporation ("Bowater"), BOWATER CANADIAN FOREST
PRODUCTS INC. a Nova Scotia company ("Bowater Canada", and together with the Parent and Bowater, "Borrowers") and each Guarantor, each as debtors and debtors in possession under Chapter 11 of the Bankruptcy Code (as
hereinafter defined) and as debtor companies under the CCAA (as hereinafter defined), AVENUE INVESTMENTS, L.P. ("Avenue Investments"), as a Lender, FAIRFAX FINANCIAL HOLDINGS LTD., as a Lender, ("FFH" and together with
Avenue Investments, the "Initial Lenders"), the other Lenders party hereto from time to time, and FFH, as administrative agent (in such capacity, the "Administrative Agent") and collateral agent (in such capacity, the
"Collateral Agent"). 
           PRELIMINARY STATEMENTS: 
           WHEREAS, on April 16, 2009 (the "Bankruptcy Petition Date"), the Borrowers and the Guarantors each filed a voluntary petition for relief (collectively, the
"Chapter 11 Cases") under Chapter 11 of title 11 of the United States Code (the "U.S. Bankruptcy Code") in the United States Bankruptcy Court for the District of Delaware (the "US Bankruptcy
Court"); 
           WHEREAS, on April 17, 2009 (the "CCAA Filing Date"), Bowater Canada and certain of its
Subsidiaries and Affiliates filed a voluntary petition in the Superior Court of Quebec (Commercial Division) (the "Canadian Bankruptcy Court") for relief, and commenced proceedings (together with the voluntary petitions filed with the
Canadian Bankruptcy Court by other Credit Parties from time to time after the CCAA Filing Date, collectively, the "CCAA Case"; together with the Chapter 11 Cases, the "Cases") under the Companies' Creditors
Arrangement Act (Canada) (the "CCAA") and have continued in the possession of their assets and in the management of their business pursuant to the CCAA and the Initial CCAA Order (as defined below); 
           WHEREAS, the Borrowers and the Guarantors are continuing to operate their respective businesses and manage their respective properties as
debtors in possession pursuant to sections 1107(a) and 1108 of the US Bankruptcy Code; 
           WHEREAS, the Borrowers have requested
that the Lenders provide a senior secured superpriority term loan facility (the "Term Facility" and, together with any Incremental Facility provided as set forth below, the "DIP Facility") for the following purposes (as
further described in Section 2.11): (i) to pay transaction costs, fees and expenses which are incurred in connection with the DIP Facility, (ii) for working capital purposes, (iii) to pay adequate protection to holders of Debt
under the Existing Facilities and (iv) for other general corporate purposes; 
           WHEREAS, the Lenders are willing to make
available to the Borrowers such DIP Facility upon the terms and subject to the conditions set forth herein and in the DIP Financing Orders (as defined below); and 
           WHEREAS, each of the Guarantors has agreed, to the extent set forth in Article VI hereof, to guaranty the obligations of the Borrowers hereunder and each Borrower and each
Guarantor has agreed to secure its obligations to the Lenders hereunder with, inter alia, security interests in, and liens on, all of its property and assets, whether real or personal, tangible or intangible, now existing or hereafter 

2
 

  

  
 
  
 acquired or arising, all as
more fully provided herein, in the DIP Financing Orders and in the Collateral Documents; 
           NOW, THEREFORE, in consideration of
the premises and mutual covenants set forth herein and such other consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
 ARTICLE I 
 DEFINITIONS 
           SECTION 1.01. Certain Defined Terms. As used in this Agreement, the following terms shall have the following meanings (such terms to be equally applicable to both the
singular and plural forms of the terms defined): 
           "Abitibi Entities" means, collectively,
(a) Abitibi-Consolidated Inc. and its Subsidiaries and (b) AbitibiBowater US Holding LLC and its Subsidiaries. 
           "ABL Facility" means a debtor in possession asset-backed revolving credit facility in an amount not to exceed $600,000,000 minus the outstanding principal amount of
the DIP Facility at any time, which may be entered into after the Final Order has been entered, on terms reasonably acceptable to the Required Lenders, and subject to intercreditor arrangements on terms acceptable to the Initial Lenders, the
proceeds of which are to be used, first, to refinance the Existing Facilities and, after the Existing Facilities have been repaid in full, for working capital and general corporate purposes. 
           "Accounts" has the meaning set forth in the UCC and, in the case of the Canadian Guarantors, in the PPSA. 
           "Account Collateral" has the meaning specified in Section 9.01(f). 
           "Advance" means a Term Advance or an advance under the Incremental Facility. 
           "Affiliate" means: 
      (a) as to any Agent or Lender, any
other Person that, directly or indirectly, controls, is controlled by or is under common control with such Person or is a director or officer of such Person; and 
      (b) as to any Person other than an Agent or Lender, any other Person that, directly or indirectly, controls, is controlled by or is under common control with such Person or is a director or officer of such
Person. For purposes of this clause (b), the term "control" (including the terms "controlling," "controlled by" and "under common control with") of a Person means the possession, direct or indirect, of the power to vote 10% or more of the Voting
Interests of such Person or to direct or cause the direction of the management and policies of such Person, whether through the ownership of Voting Interests, by contract or otherwise. 
           "Agents" means, collectively, the Administrative Agent and the Collateral Agent. 
           "Agreement Value" means, for each Hedge Agreement, on any date of determination, an amount equal to: (a) in the case of a Hedge Agreement documented pursuant
to the Master Agreement (Multicurrency-Cross Border) published by the International Swap and Derivatives Association, Inc. (the 
 
3
 

  

  
 
  
 "Master
Agreement"), the amount, if any, that would be payable by any Credit Party or any of its Subsidiaries to its counterparty to such Hedge Agreement, as if (a) in the case of a Hedge Agreement traded on an exchange, the mark-to-market
value of such Hedge Agreement, which will be the unrealized loss or gain on such Hedge Agreement to the Credit Party or Subsidiary of a Credit Party to such Hedge Agreement based on the settlement price of such Hedge Agreement on such date of
determination; or (b) in all other cases, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss or gain on such Hedge Agreement to the Credit Party or Subsidiary of a Credit Party to such Hedge Agreement determined
as the amount, if any, by which (i) the present value of the future cash flows to be paid by such Credit Party or Subsidiary exceeds (ii) the present value of the future cash flows to be received by such Credit Party or Subsidiary pursuant
to such Hedge Agreement; capitalized terms used and not otherwise defined in this definition shall have the respective meanings set forth in the above described Master Agreement. 
           "Applicable Margin" means, in the case of a Base Rate Advance, 6.50% and in the case of a LIBOR Advance, 7.50%; provided that if all obligations hereunder
shall not have been repaid in full within 12 months following the Closing Date, "Applicable Margin" shall mean, in the case of a Base Rate Advance, 7.0% and in the case of a LIBOR Advance, 8.0%. 
           "Applicable Law" means all applicable statutes, laws, ordinances, regulations, orders, writs, injunctions or decrees of the
United States, any state, Canada, any provinces, any foreign country or any other Governmental Authority. 
           "Approved
Fund" means any fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender. 
           "Asset Disposition" means the disposition of any or all of the assets (including, without limitation, any Equity Interest
owned thereby) of Parent or any of its Subsidiaries, in one transaction or a series of transactions, whether by sale, lease, transfer or otherwise. The term "Asset Disposition" shall not include any Insurance and Condemnation Event. 
           "Assignment and Acceptance" means an assignment and acceptance entered into by a Lender and an Eligible Assignee, and
accepted by the Administrative Agent, and, if required, the Borrowers, in accordance with Section 10.07 and in substantially the form of Exhibit A hereto. 
           "Assuming Lender" has the meaning specified in Section 2.10(d). 
           "Avoidance Actions" shall mean avoidance actions of the Borrowers under Chapter 5 or Section 724(a) of the Bankruptcy Code (and proceeds thereof other than
proceeds of avoidance actions under Section 547 of the Bankruptcy Code). The term does not include an action to avoid a transfer under Section 549 of the Bankruptcy Code. 
           "Bankruptcy Code" shall mean the Bankruptcy Reform Act of 1978, as heretofore and hereafter amended, and codified as 11 U.S.C. Section 101 et seq.

           "Bankruptcy Courts" means, collectively, the US Bankruptcy Court and the Canadian Bankruptcy Court, or any
other court having jurisdiction over the Cases from time to time. 
           "Bankruptcy Petition Date" has the meaning
specified in Preliminary Statement. 
 
4
 

  

  
 
  
           "Base Rate" means a fluctuating interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to the higher of (a) 1/2 of 1% per annum above the Federal Funds Rate and (b) 2.50%. 
           "Base Rate Advance" means an Advance bearing interest at the Base Rate. 
           "BIA" means the Bankruptcy and Insolvency Act (Canada) or any successor statute, as amended. 
           "Borrowers" shall have the meaning set out in the preamble. 
           "Borrowing" means a Term Borrowing or a borrowing under an Incremental Facility. 
           "Borrowing Date" means the date on which the Term Advance is made. 
           "Bowater D&O Charge" means the Canadian court-ordered charge for directors and officers in an aggregate amount not to exceed $25,000,000 Canadian Dollars
securing the Canadian Credit Parties' obligation to indemnify the directors and officers of the Canadian Credit Parties for certain liabilities arising after entry of the Initial CCAA Order or in connection with the Canadian Credit Parties' failure
to make payments in respect of employee obligations (as set forth more fully in paragraphs 51 and 53 of the Initial CCAA Order). 
           "Bowater Entities" means Bowater, Newsprint South and each of their respective Subsidiaries. For the avoidance of doubt, "Bowater Entities" shall not include the
Abitibi Entities. 
           "Budget Variance Report" means a report, in each case certified by a Responsible Officer of
the Parent, in form reasonably satisfactory to the Required Lenders, delivered in accordance with Section 5.03(g), showing actual cash flows and the aggregate maximum amount of utilization of the Advances for each such week as of the end of the
week immediately preceding the week during which such Budget Variance Report is delivered and the variance (as a percentage) of such amounts from the corresponding anticipated amounts therefor set forth in the DIP Budget. 
           "Business Day" means a day of the year on which banks are not required or authorized by law to close in New York, New York.

           "Canadian Bankruptcy Court" has the meaning specified in the Preliminary Statements. 
           "Canadian Credit Parties" means Bowater Canada and the Canadian Guarantors. 
           "Canadian DIP Recognition Order" means a recognition order made by the Canadian Bankruptcy Court pursuant to section 18.6
of the CCAA, in form and substance acceptable to the Required Lenders in their sole discretion, recognizing and giving full force and effect to the Interim Order. 
           "Canadian Dollars" means lawful money of Canada. 
           "Canadian Guarantors" means each direct and indirect wholly-owned Subsidiary of Bowater and Newsprint South organized under the laws of Canada and which is a debtor
in the CCAA Cases, as listed on Schedule II hereto and, as of the date of such requirement, each other Subsidiary organized under the laws of Canada that shall be required to execute and deliver a guaranty pursuant to Section 6.01. 

5
 

  

  
 
  
           "Canadian Pension Plan" means any "registered pension plan" as defined under the Income Tax Act (Canada) administered or contributed to by (or to which there
is or may be an obligation to contribute by) Bowater Canada or any Subsidiary of Bowater Canada incorporated under the Applicable Laws of Canada or any applicable province or territory thereof, in respect of any Person's employment in Canada or a
province or territory thereof with Bowater Canada or any Subsidiary of Bowater Canada incorporated under the Applicable Laws of Canada or any applicable province or territory thereof, all related funding agreements and all related agreements,
arrangement and understandings in respect of, or related to, any benefits to be provided thereunder. 
           "Canadian Pension
Plan Event" means the occurrence of any of the following events other than the failure to pay the special amortization payments in relation to a Canadian Pension Plan (the "Special Amortization Payments"): (a) any default
or violation under a Canadian Pension Plan by any Credit Party or by any other party to any Canadian Pension Plan or the failure to pay any contribution or premium required to be paid to or in respect of any Canadian Pension Plan in a timely fashion
in accordance with the terms thereof and all applicable law or any taxes, penalties or fees are owing or eligible under any Canadian Pension Plan beyond the date permitted for payment of same; (b) the receipt by a Credit Party of any notice
from any Person questioning or challenging the establishment, registration, qualification, administration or investment of a Canadian Pension Plan in compliance with the terms thereof and all applicable law (other than in respect of any claim
related solely to that Person); (c) any proceeding, action, suit or claim (other than routine claims for benefits) pending or threatened involving any Canadian Pension Plan or its assets, or the existence of facts which could reasonably be
expected to give rise to any such proceeding, action, suit or claim (other than routine claims for benefits); (d) any event respecting any Canadian Pension Plan which would entitle any Person (without the consent of the applicable Credit Party)
to wind-up or terminate any Canadian Pension Plan, in whole or in part, or which could reasonably be expected to adversely affect the tax status thereof; (e) a material going concern unfunded actuarial liability, past service unfunded liability
or solvency deficiency in excess of $200,000,000 exists with respect to any single Canadian Pension Plan to the best of the Credit Party's knowledge or as revealed in actuarial valuation reports filed with applicable Governmental Authorities; or
(f) the occurrence of an improper withdrawal or transfer of assets from any Canadian Pension Plan. 
           "Canadian
Second DIP Recognition Order" means a recognition order made by the Canadian Bankruptcy Court pursuant to section 18.6 of the CCAA, in form and substance acceptable to the Required Lenders in their sole discretion recognizing and giving full
force and effect to the Final Order. 
           "Canadian Term Advance" has the meaning specified in Section 2.01.

           "Capital Expenditures" means, for any Person for any period, the sum (without duplication) of all expenditures
made, directly or indirectly, by such Person or any of its Subsidiaries during such period for equipment, fixed assets, real property or improvements, or for replacements or substitutions therefor or additions thereto, that have been or should be,
in accordance with GAAP, reflected as additions to property, plant or equipment on a Consolidated balance sheet of such Person. 
           "Capitalized Leases" means all leases that have been or should be, in accordance with GAAP, recorded as capitalized leases. 
           "Carve-Out" means (x) with respect to the US Borrowers, the US Guarantors and their respective Cases and assets
(i) all fees required to be paid to the Clerk of the Bankruptcy Court and the Office of the US Trustee pursuant to 28 U.S.C. §1930, (ii) after the occurrence and during the continuance of an Event of Default, an amount not to exceed
$7,500,000 plus all accrued and unpaid professional fees and disbursements incurred prior to the occurrence of an Event of Default to the extent 
 
6
 

  

  
 
  
 allowed by the US Bankruptcy
Court at any time, which amount may be used subject to the terms of the Interim Order (or the Final Order, when applicable) to pay any fees or expenses incurred by the Bowater Entities and any statutory committee appointed in the Cases prior to and
after an Event of Default in respect of compensation for services rendered or reimbursement of expenses allowed by the Bankruptcy Court to professionals of the Bowater Entities or any statutory committee appointed in the Cases and (iii) in the
event of the conversion of the Cases to cases under Chapter 7 of the US Bankruptcy Code, an amount not to exceed $50,000 in respect of allowances of compensation for services rendered and reimbursement of expenses awarded by the US Bankruptcy
Court to the Chapter 7 trustee or any professional retained by such trustee; and (y) with respect to the Canadian Credit Parties and their respective Cases and assets (i) the administration charge provided for in the Initial CCAA Order in
an aggregate amount not to exceed $2,000,000 Canadian Dollars for the payment of (A) allowed and unpaid professional fees and disbursements incurred by professionals and advisers retained by the Canadian Credit Parties in the CCAA Cases and
(B) allowed and unpaid professional fees and disbursements of the monitor in the CCAA Cases, including allowed and unpaid fees and expenses of its counsel and (ii) the Bowater D&O Charge in an aggregate amount not to exceed $7,500,000
Canadian Dollars; provided, however, that the dollar limitation set forth in clause (x)(ii) of this definition shall not be reduced by the amount of any compensation or reimbursement of expenses incurred but unpaid, or paid (to the
extent ultimately allowed by an order of the Bankruptcy Court) prior to the occurrence of an Event of Default in respect of which the Carve-Out is invoked or by any fees, expenses, indemnities or other amounts paid to the Administrative Agent, any
Lender, any Prepetition Lender or their respective attorneys and agents hereunder or otherwise; provided further, however, that nothing in this definition shall be construed to impair the ability of any party to object, pursuant to
Section 330 of the US Bankruptcy Code, to the reasonableness of the fees, expenses, reimbursement or compensation described in clauses (A) and (B) above. 
           "Cases" has the meaning specified in the Preliminary Statements. 
           "Cash Equivalents" means (a) marketable direct obligations issued or unconditionally guaranteed by the United States Government or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case, maturing within six months from the date of acquisition thereof; (b) commercial paper, maturing not more than 270 days after the date of issue rated P-1 by Moody's
or A-1 by Standard & Poor's; (c) certificates of deposit maturing not more than 270 days after the date of issue, issued by commercial banking institutions and money market or demand deposit accounts maintained at commercial banking
institutions, each of which is a member of the Federal Reserve System and has a combined capital and surplus and undivided profits of not less than $500,000,000; (d) repurchase agreements having maturities of not more than 90 days from the
date of acquisition which are entered into with major money center banks included in the commercial banking institutions described in clause (c) above and which are secured by readily marketable direct obligations of the United States
Government or any agency thereof; (e) money market accounts maintained with mutual funds having assets in excess of $2,500,000,000; and (f) tax exempt securities rated A or higher by Moody's or A+ or higher by Standard & Poor's. 

          "Cash Management Order" means the "first day order" pertaining to the Borrowers' cash management services, including
treasury, depository, overdraft, credit or debit card, electronic funds transfer and other cash management arrangements. 
           "Catawba Acre" refers to the parcel of real property described in Schedule III. 
           "Catawba Acre Lien" means any Lien evidenced by a mortgage registration on the Catawba Acre in favor of the secured party of record indicated in Schedule III.

 
7
 

  

  
 
  
           "CCAA" has the meaning specified in the Preliminary Statements. 
           "CCAA Case" has the meaning specified in the Preliminary Statements. 
           "Change of Control" means any of the following: (a) any person or group of persons (within the meaning of the Securities Exchange Act of 1934, as amended)
other than FFH shall have acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended) of 35% or more of the issued and outstanding
Equity Interests of the Parent having the right to vote for the election of directors of the Parent under ordinary circumstances; or (b) any Person or two or more Persons acting in concert other than FFH shall have acquired beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended), directly or indirectly, of Equity Interests of the Parent (or other securities convertible into such Equity
Interests) representing 35% or more of the combined voting power of all Equity Interests of the Parent; or (c) any Person or two or more Persons acting in concert other than FFH shall have acquired by contract or otherwise, or shall have
entered into a contract or arrangement that, upon consummation, will result in its or their acquisition of the power to exercise, directly or indirectly, a controlling influence over the management or policies of the Parent representing 35% or more
of the combined voting power of all Equity Interests of the Parent; or (d) during any period of twenty-four consecutive calendar months, individuals who at the beginning of such period constituted the Board of Directors of any Borrower
(together with any new directors whose election by the Board of Directors of such Borrower or whose nomination for election by the stockholders of such Borrower was approved by a vote of at least a majority of the directors then still in office who
either were directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason other than death or disability to constitute a majority of the directors then in office; or
(e) any one or more of the officers specified in Schedule 1.01(a) shall no longer hold the position specified in Schedule 1.01(a), unless such Person is replaced with an officer reasonably acceptable to the Required Lenders within
45 days thereafter; or (f) the Parent shall cease, to directly or indirectly, own 100% of the Equity Interests in Bowater, Newsprint South or Bowater Canada (other than the Exchangeable Shares). 
           "Chief Restructuring Officer" means an officer of the Parent responsible for managing the restructuring of the Bowater
Entities and the Abitibi Entities in the Cases. 
           "Closing Date" has the meaning specified in Section 3.01.

           "Collateral" has the meaning specified in Section 9.01. 
           "Collateral Agent" has the meaning set forth in the Preamble hereto. 
           "Collateral Documents" means, collectively, the DIP Financing Orders and any other security agreement, pledge agreement, mortgage or other documents delivered
pursuant to Section 5.01(l) or otherwise that creates or purports to create a Lien in favor of the Collateral Agent for the benefit of the Secured Parties. 
           "Commitment" means, with respect to any Lender at any time, the amount set forth opposite such Lender's name on Schedule I hereto under the caption
"Commitment" or, if such Lender has entered into an Assignment and Acceptance, the amount set forth for such Lender in the Register maintained by the Administrative Agent pursuant to Section 10.07 as such Lender's "Commitment." 
           "Commitment Assumption Agreement" has the meaning specified in Section 2.10(d)(B). 
 
8
 

  

  
 
  
           "Commitment Letter" means the commitment letter, dated as of April 11, 2009, between the Parent, Bowater, Newsprint South and FFH. 
           "Computer Software" has the meaning specified in Section 9.01(g)(iv). 
           "Confidential Information" means any and all material non-public information delivered or made available by any Credit
Party or any Subsidiary relating to any Credit Party or any Subsidiary or their respective businesses, other than any such information that is or has been made available publicly by a Credit Party or any Subsidiary. 
           "Confirmation Order" means collectively, an order of the US Bankruptcy Court confirming a Reorganization Plan in the
Chapter 11 Cases and an order of the Canadian Bankruptcy Court confirming a Reorganization Plan in the CCAA Case, which orders shall be in form and substance reasonably satisfactory to the Required Lenders. 
           "Consolidated" refers to the consolidation of accounts in accordance with GAAP. 
           "Consolidated EBITDA" means, for any period, the sum for the Bowater Entities (determined on a combined basis, without
duplication, in accordance with GAAP) of the following: 
           (a) Consolidated Net Income for such period, 
           plus 
           (b) the sum of the following to the extent deducted in determining Consolidated Net Income for such period: 
           (i) income taxes for such period (or minus, to the extent added in determining Consolidated Net Income for such period, income tax benefit for such period); 

          (ii) amortization, depreciation, depletion and other non-cash charges for such period; 
           (iii) Consolidated Interest Expense for such period; 
           (iv) any extraordinary charges for such period; 
           (v) any unusual or non-recurring charges for such period up to an amount not to exceed five percent (5%) of the Consolidated EBITDA of the Parent and its Subsidiaries (as
calculated without giving effect to this clause (v) or clause (vi) below); and 
           (vi) any net loss on any Asset
Disposition during such period, 
           less 
           (c) the sum of the following to the extent included in determining Consolidated Net Income for such period: 
           (i) the aggregate amount of interest income for such period; 
           (ii) any extraordinary gains during such period; 
           (iii) any unusual or non-recurring gains during such period; and 
 
9
 

  

  
 
  
           (iv) any net gain on any Asset Disposition during such period; 
 provided that, for purposes of this
Agreement, Consolidated EBITDA shall be adjusted on a pro forma basis, in a manner consistent with Regulation S-X of the SEC or otherwise reasonably acceptable to the Required Lenders, to include or exclude, as applicable, as of the first day
of any applicable period, any permitted Asset Disposition closed during such period. 
           "Consolidated Fixed Charge
Coverage Ratio" means, as of the last day of any Fiscal Quarter, with respect to the Bowater Entities for the period of four consecutive Fiscal Quarters most recently ended on or prior to such date, taken as one accounting period, the ratio
of (a) Consolidated EBITDA as of such last day of such Fiscal Quarter to (b) the sum of (i) interest payable on, and amortization of debt discount in respect of, all Debt for borrowed money, plus (ii) rentals payable under
leases of real or personal, or mixed, property, plus (iii) principal amounts of all Debt for borrowed money payable, in each case, of or by the Bowater Entities for or during such period. 
           "Consolidated Interest Expense" means, with respect to the Bowater Entities, for any period, the gross interest expense determined for such period on a combined
basis without duplication, in accordance with GAAP. 
           "Consolidated Net Income" means, with respect to the
Bowater Entities, for any period, the net income (or loss) of the Bowater Entities for such period, determined on a combined basis and otherwise determined in accordance with GAAP. 
           "Consolidated Subsidiary" means, for any Person, each Subsidiary of such Person (whether now existing or hereafter created or acquired) the financial statements of
which shall be (or should have been) consolidated with the financial statements of such Person in accordance with GAAP, excluding, in the case of the Parent, the Abitibi Entities. 
           "Conversion," "Convert" and "Converted" each refer to a conversion of Advances of one Type into Advances of the other Type pursuant to
Section 2.06. 
           "Copyrights" has the meaning specified in Section 9.01(g)(iii). 
           "Credit Parties" means, collectively, the Borrowers and the Guarantors. 
           "Debt" of any Person means, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all
indebtedness of such Person for the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of such Person's business), (c) all obligations of such Person evidenced by notes, bonds, debentures or
other similar instruments, (d) all indebtedness of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller
or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all obligations of such Person as lessee under Capitalized Leases, (f) all obligations of such Person (other than pursuant to
any employee benefit plan or incentive compensation plan) under acceptances, letter of credit or similar facilities, (g) all mandatory obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in cash in respect
of any Equity Interests in such Person or any other Person or any warrants, rights or options to acquire such Equity Interests, valued, in the case of Redeemable Preferred Interests, at the greater of its voluntary or involuntary liquidation
preference plus accrued and unpaid dividends, (h) all obligations of such Person in respect of Hedge Agreements, valued at the Agreement Value thereof, (i) all Guarantee Obligations of such Person and (j) all indebtedness and
other payment Obligations referred to in clauses (a) through (i) above of another 
 
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 Person secured by (or for
which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Lien on property (including, without limitation, accounts and contract rights) owned by such Person, even though such Person has not assumed or
become liable for the payment of such indebtedness or other payment Obligations. 
           "Debtor Relief Laws" means the
Bankruptcy Code, the CCAA, the BIA and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United
States, Canada or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally. 
           "Default" means any Event of Default or any event that would constitute an Event of Default but for the requirement that notice be given or time elapse or both.

           "Default Interest" has the meaning specified in Section 2.07. 
           "DIP Budget" means the Interim DIP Budget together with the Final DIP Budget. 
           "DIP Financing Orders" means, collectively, Initial CCAA Order and, prior to the entry of the Final Order, the Interim
Order and, following the entry of the Final Order, the Final Order. 
           "Dollars" and "$" each mean
lawful currency of the United States of America. 
           "Eligible Assignee" means (i) the Initial Lenders;
(ii) an Affiliate of the Initial Lenders; (iii) an Approved Fund of the Initial Lenders; and (iv) any other Person (other than an individual) approved by the Required Lenders; provided, however, that neither any Credit
Party nor any Affiliate of a Credit Party shall qualify as an Eligible Assignee under this definition; and provided, further, that no Person that is a competitor or Affiliate of a competitor of the Bowater Entities in the paper or
forest products industry shall qualify as an Eligible Assignee under this definition. 
           "Environmental Action"
means any action, suit, demand, demand letter, claim, notice of noncompliance or violation, notice of liability or potential liability, investigation, proceeding, order or agreement (including any obligations to indemnify) relating in any way to any
Environmental Law, any Environmental Permit, any Hazardous Material, or arising from alleged injury or threat to public health or safety or, employee health or safety, as such relates to exposure to Hazardous Material, or to natural resources or the
environment, including, without limitation, (a) by any governmental or regulatory authority or third party for enforcement, cleanup, removal, response, remedial or other actions or damages and (b) by any governmental or regulatory authority or
third party for damages, contribution, indemnification, cost recovery, compensation or injunctive relief. 
           "Environmental Law" means any applicable federal, state, provincial, municipal, local or foreign statute, law, ordinance, rule, regulation, code, order, writ,
judgment, injunction or decree, or legally binding judicial or agency interpretation, relating to pollution or protection of the environment, public health or safety, as such relates to exposure to Hazardous Material, employee health or safety or
natural resources, including, without limitation, those relating to the use, handling, transportation, treatment, storage, disposal, release or discharge of Hazardous Materials. 
           "Environmental Permit" means any permit, approval, identification number, license or other authorization required under any Environmental Law. 
 
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           "Equipment" has the meaning specified in the UCC, and in the case of the Canadian Guarantors, in the PPSA. 
           "Equity Interests" means, with respect to any Person, shares of capital stock of (or other ownership or profit interests in) such Person, warrants, options or other
rights for the purchase or other acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, securities convertible into or exchangeable for shares of capital stock of (or other ownership or
profit interests in) such Person or warrants, rights or options for the purchase or other acquisition from such Person of such shares (or such other interests), and other ownership or profit interests in such Person (including, without limitation,
partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are authorized on any date of determination. 
           "ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations
promulgated and rulings issued thereunder. 
           "ERISA Affiliate" means any Person that for purposes of Title IV of
ERISA is a member of the controlled group of any Credit Party, or under common control with any Credit Party, within the meaning of Section 414(b), (c), (m) or (o) of the Internal Revenue Code. 
           "ERISA Event" means (a) (i) the occurrence of a reportable event, within the meaning of Section 4043 of ERISA,
with respect to any ERISA Plan unless the 30-day notice requirement with respect to such event has been waived by the PBGC or (ii) the requirements of subsection (1) of Section 4043(b) of ERISA (without regard to subsection (2) of
such Section) are met with respect to a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of an ERISA Plan, and an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably
expected to occur with respect to such ERISA Plan within the following 30 days; (b) the application for a minimum funding waiver with respect to an ERISA Plan; (c) the provision by the administrator of any ERISA Plan of a notice of
intent to terminate such ERISA Plan, pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation of operations at a facility of any Credit Party
or any ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e) the withdrawal by any Credit Party or any ERISA Affiliate from a Multiple Employer Plan during a plan year for which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a lien under Section 303(k) of ERISA shall have been met with respect to any ERISA Plan; or (g) the institution by the PBGC of proceedings to terminate an
ERISA Plan pursuant to Section 4042 of ERISA, or the occurrence of any event or condition described in Section 4042 of ERISA that constitutes grounds for the termination of, or the appointment of a trustee to administer, such ERISA Plan.

           "ERISA Plan" means a Single Employer Plan or a Multiple Employer Plan. 
           "Event of Default" has the meaning set forth in Section 7.01. 
           "Exchangeable Shares" means those shares of capital stock issued by Bowater Canada and listed (or previously listed) on the Toronto Stock Exchange (under stock
symbol BWX) which are exchangeable at any time at the option of the holder of such shares into common stock of the Parent and which entitle the holders thereof to similar voting rights and dividend payments (on a per share basis) as those granted to
holders of the common stock of the Parent. 
           "Excluded Deposit Account" means, collectively, (a) Deposit
Accounts established solely for the purpose of funding payroll, payroll taxes and other compensation and benefits to employees 
 
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 or other similar items and any
other Deposit Account in which a security interest would be unlawful under Applicable Law or in violation of any employee benefit plan or employee benefit agreement and (b) except as otherwise required by the Collateral Agent following the
occurrence and during the continuance of a Default or Event of Default, Deposit Accounts with amounts on deposit that as of the close of business on any day, when aggregated with (i) the amounts on deposit in all other Deposit Accounts for
which a control agreement has not been obtained (other than those specified in clause (a)) and (ii) the aggregate fair market value of all Excluded Investment Property, do not exceed $2,000,000; provided that notwithstanding anything to
the contrary contained in this Agreement, any Deposit Account of a Credit Party which is a concentration account or collection account shall not be deemed to be an Excluded Deposit Account at any time. 
           "Excluded Investment Property" means, collectively, (a) Investment Property held in a Securities Account established
solely for the purpose of funding payroll, payroll taxes and other compensation and benefits to employees or other similar items and any other Investment Property held in a Securities Account in which a security interest would be unlawful under
Applicable Law or in violation of any employee benefit plan or employee benefit agreement, and (b) except as otherwise required by the Collateral Agent following the occurrence and during the continuance of a Default or Event of Default,
Investment Property with an aggregate fair market value that as of the close of any business day, when aggregated with (a) the fair market value of all other Investment Property held in a Securities Account for which a control agreement has not
been obtained and (b) the aggregate amounts on deposit in all Excluded Deposit Accounts, does not exceed $2,000,000 at any time; provided that notwithstanding anything to the contrary contained in this Agreement, any Investment Property held
in a Securities Account of a Credit Party which is a concentration account or collection account shall not be deemed to be Excluded Investment Property at any time. 
           "Excluded Property" means: 
      (i) assets owned by a
Subsidiary if 100% of the Equity Interests of such Subsidiary are not owned by one or more Credit Parties, and Equity Interests issued by any such Subsidiary to the extent that agreements with one or more other shareholders of such Subsidiary would
prohibit the pledge of such Equity Interests to the Collateral Agent; 
      (ii) any assets to the extent that, and for so long as, taking a
security interest in such assets would violate any applicable law or regulation; 
      (iii) any leasehold interests in real property; 

     (iv) any equipment or other asset owned by a Credit Party that is subject to a purchase money lien or a Capitalized Lease obligation, if the
contract or other agreement in which the Lien is granted (or the documentation providing for such Capitalized Lease obligation) prohibits or requires the consent of any Person other than such Credit Party as a condition to the creation of any other
security interest on such equipment or asset; 
      (v) any shares of capital stock or other Equity Interests issued by any Foreign Subsidiary
in excess of 65% of all issued and outstanding shares of all classes of capital stock or other Equity Interests of such Foreign Subsidiary; 
      (vi) any rights under any lease, contract or agreement to the extent that the granting of a security interest therein is specifically prohibited in writing by, or would constitute an event of default under or
would grant a party a termination right under any agreement governing such right unless such prohibition is not enforceable or is otherwise ineffective under Applicable Law; 
 
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 provided, however, that this clause (vi) shall not affect, limit, restrict or impair the grant by any Credit Party of a security interest in any Account, money or other amounts due and payable to any Credit Party or to
become due and payable to any Credit Party under such lease, contract or agreement unless such Security Interest in such Account, money or other amount due and payable is also specifically prohibited by the terms of such lease, contract or agreement
or such security interest in such Account, money or other amount due and payable or would expressly constitute an event of default under or would expressly grant a party a termination right under any such lease contract or agreement, in each case
unless such prohibition is not enforceable or is otherwise ineffective under Applicable Law; provided, further, that notwithstanding anything to the contrary contained in the foregoing proviso, the security interests granted
herein shall immediately attach to and the term "Collateral" shall immediately include the rights under any such lease, contract, or agreement and in such Account, money, or other amounts due and payable to any Credit Party at such time as such
prohibition, event of default or termination right shall terminate or shall be waived; 
           (vii) any Excluded Deposit
Accounts and Excluded Investment Property; and 
           (viii) any Avoidance Actions. 
           "Excluded Taxes" means (a) Income Taxes imposed directly on an Indemnified Party (or its members or shareholders) in
respect of payments hereunder or under any other Loan Documents, and (b) any withholding or other taxes imposed or otherwise due in respect of such payments because the Indemnified Party fails to satisfy the requirements of
Section 2.14(e). 
           "Existing Facilities" has the meaning specified in Section 4.01(m). 
           "Fee Letter" means the fee letter, dated as of April 11, 2009, between the Parent and FFH. 
           "FFH" shall have the meaning set out in the Preamble. 
           "Final DIP Budget" means the updated Interim DIP Budget delivered by the Borrower prior to or in connection with the entry of the Final Order. 
           "Final Order" shall have the meaning given to such term in Section 5.01(n)(A). 
           "Fiscal Quarter" means any fiscal quarter of any Fiscal Year, which quarter shall end on the last day of each March, June,
September and December of such Fiscal Year in accordance with the fiscal accounting calendar of the Parent and its Subsidiaries. 
           "Fiscal Year" means a fiscal year of the Parent and its Subsidiaries ending on December 31. 
           "Foreign Subsidiary" means any Subsidiary that is not organized under the laws of any political subdivision of the United States. 
           "GAAP" means applicable generally accepted accounting principles, consistently applied; provided, however,
that for purposes of this Agreement and the other Loan Documents, any financial statements or other financial information shall not be regarded as not having been prepared in accordance with GAAP (a) in the case of Bowater and Newsprint South,
solely by reason of such financial statements or financial information being made on a combined basis for Bowater and Newsprint 
 
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 South or (b) in the case
of AbitibiBowater US Holding LLC and Abitibi Consolidated Inc., solely by reason of (i) such financial statements or financial information being made on a combined basis for AbitibiBowater US Holding LLC and Abitibi Consolidated Inc. or
(ii) such financial statements or financial information being prepared in accordance with generally accepted accounting principles as in effect in Canada. 
           "GAAP Subsidiaries" means, with respect to Parent, all Persons which are required to be Consolidated with the Parent in accordance with GAAP, including, without
limitation, the Bowater Entities and the Abitibi Entities. 
           "General Intangibles" has the meaning specified in
the UCC and, in the case of the Canadian Guarantors, has the meaning given to the term "intangible" in the PPSA. 
           "Governmental Authority" means any nation or government, any state, province, city, municipal entity or other political subdivision thereof, and any governmental,
executive, legislative, judicial, administrative or regulatory agency, department, authority, instrumentality, commission, board, bureau or similar body, whether federal, state, provincial, territorial, local or foreign. 
           "Guarantee Obligation" means, with respect to any Person, any obligation or arrangement of such Person to guarantee or
intended to guarantee any Debt ("primary obligations") of any other Person (the "primary obligor") in any manner, whether directly or indirectly, including, without limitation, (a) the direct or indirect guarantee, endorsement (other than for
collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the primary obligation of a primary obligor, (b) the obligation to make take-or-pay or similar payments, if
required, regardless of nonperformance by any other party or parties to an agreement or (c) any obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (A) for the purchase or payment of any such primary obligation or (B) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net
worth or solvency of the primary obligor, (iii) to purchase property, assets, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof. The amount of any Guarantee Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Guarantee Obligation is made (or, if less, the maximum amount of such primary obligation for which such Person may be liable pursuant to the terms of the instrument evidencing such Guarantee
Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder), as determined by such Person in good faith. 
           "Guaranteed Obligations" has the meaning specified in Section 6.01. 
           "Guaranty Supplement" has the meaning specified in Section 6.05. 
           "Guarantors" means, collectively, the US Guarantors and the Canadian Guarantors. 
           "Hazardous Materials" means (a) petroleum or petroleum products, by-products or breakdown products, radioactive materials, asbestos-containing materials,
polychlorinated biphenyls, mold, greenhouse gases and radon gas and (b) any other chemicals, materials or substances designated, classified or regulated as hazardous, toxic, a contaminant or words of similar import under any Environmental Law.

 
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           "Hedge Agreements" means interest rate swap, cap or collar agreements, interest rate future or option contracts, currency swap agreements, currency future or option
contracts and other hedging agreements. 
           "Immaterial Subsidiary" means any Subsidiary that is not a Material
Subsidiary. 
           "Income Taxes" means taxes that are imposed on the overall net income (and franchise taxes imposed
in lieu thereof) of any Person by the United States or the state or foreign jurisdiction (or any political subdivision thereof) under the laws of which such Person is organized or in which it carries on business. 
           "Increase Date" has the meaning specified in Section 2.10(a). 
           "Increasing Lender" has the meaning specified in Section 2.10(b). 
           "Incremental Commitment Date" has the meaning specified in Section 2.10(b). 
           "Incremental Commitment" has the meaning specified in Section 2.10(a). 
           "Incremental Facility" has the meaning specified in Section 2.10(a). 
           "Indemnified Party" has the meaning specified in Section 2.14(a). 
           "Initial CCAA Order" means the issued and entered order of the Canadian Bankruptcy Court in the CCAA Case containing customary provisions, inter alia,
declaring that Bowater Canada and the Bowater Entities, which are debtor companies under the CCAA Case are proper debtor companies under the CCAA, providing all customary stays of proceedings against the debtor companies and their property,
authorizing the debtor companies to reorganize, recognizing and providing for a stay of proceedings in Canada with respect to the US Borrowers and US Guarantors and granting a Lien in accordance with the terms and conditions of this Agreement, in
favor of the Collateral Agent for and on behalf of the Secured Parties, as such order may be amended, varied, modified or restated from time to time. 
           "Initial Lenders" means FFH and Avenue Investments. 
           "Insurance and Condemnation Event" means the receipt by the Parent, Bowater, Newsprint South or any of their respective Subsidiaries of any cash insurance proceeds
or condemnation award payable by reason of theft, loss, physical destruction or damage, taking or similar event with respect to any of their respective property or assets. 
           "Intellectual Property" has the meaning specified in Section 9.01(g). 
           "Intercompany Claims" means all intercompany debt payable to the Borrowers and the Guarantors arising after the Bankruptcy Petition Date. 
           "Intercompany Subordination Agreement" means a master Intercompany Subordination Agreement to be entered into between the
applicable Credit Parties and Subsidiaries thereof party thereto, in form and substance satisfactory to the Administrative Agent. 
           "Interest Period" means the period commencing on the Borrowing Date and ending on the numerically corresponding day (or if there is no corresponding day, the last
day) in the calendar 
 
16
 

  

  
 
  
 month that is one, two or
three months, as the Borrowers may designate by delivery of notice received by the Administrative Agent not later than 2:00 p.m. (New York City time) on the third Business Day prior to the first day of such Interest Period, after the month in which
the Borrowing Date occurs and, thereafter, each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the numerically corresponding day (or if there is no corresponding day, the last day) in the
calendar month that is one month, two months or three months after the last day of the immediately preceding Interest Period; provided, however, that (A) if any Interest Period would end on a day that is not a LIBOR Business Day,
such Interest Period shall be extended to the next succeeding LIBOR Business Day unless such next succeeding LIBOR Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding LIBOR Business
Day, and (B) the final Interest Period shall end on or prior to the Maturity Date. 
           "Interim DIP Budget"
has the meaning specified in Section 3.01(a)(vii). 
           "Interim Order" shall have the meaning given to such
term in Section 3.01(b). 
           "Inventory" has the meaning specified in the UCC and in the case of the Canadian
Guarantors, in the PPSA. 
           "Investment" means, with respect to any Person, (a) any direct or indirect
purchase or other acquisition (whether for cash, securities, property, services or otherwise) by such Person of, or of a beneficial interest in, any Equity Interests or Debt of any other Person, (b) any direct or indirect purchase or other
acquisition (whether for cash, securities, property, services or otherwise) by such Person of all or substantially all of the property and assets of any other Person or of any division, branch or other unit of operation of any other Person,
(c) any direct or indirect loan, advance, other extension of credit or capital contribution by such Person to, or any other investment by such Person in, any other Person (including, without limitation, (i) any arrangement by which one
Person pays expenses of another Person and (ii) any arrangement pursuant to which the investor incurs indebtedness of the types referred to in clause (i) or (j) of the definition of "Debt" set forth in this
Section 1.01 in respect of such other Person) and (d) any written agreement to make any Investment. 
           "IP
Agreements" has the meaning specified in Section 9.01(g)(viii). 
           "Lender Appointment Period" has
the meaning specified in Section 8.06. 
           "Lender Priority Collateral" means (i) the real property,
physical plants, fixtures and equipment of Bowater and its wholly-owned Subsidiaries organized under the laws of the United States of America, including, but not limited to, their respective properties located in Catawba, South Carolina, and
Calhoun, Tennessee and (ii) any Intercompany Claims. 
           "Lenders" means the Initial Lenders, and any other
Person that may become a Lender in accordance with Section 10.07 hereof for so long as such Initial Lender or Person, as the case may be, shall be a party to this Agreement. 
           "Lending Office" means, with respect to any Lender, the office of such Lender specified as its "Lending Office" opposite its name on Schedule I hereto or in
the Assignment and Acceptance pursuant to which it became a Lender, as the case may be, or such other office of such Lender as such Lender may from time to time specify to the Borrowers and the Administrative Agent. 
           "LIBOR" means, an interest rate per annum equal to the higher of (a) the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters LIBOR01 Page (or any 
 
17
 

  

  
 
  
 successor page) as the London
interbank offered rate for deposits in US dollars at 11:00 A.M. (London time) two Business Days before the first day of such Interest Period for a period equal to such Interest Period (provided that, if for any reason such rate is not
available, the term "LIBOR" shall mean, for any Interest Period for all LIBOR Advances comprising part of the same Borrowing, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters LIBOR01
Page as the London interbank offered rate for deposits in Dollars at approximately 11:00 A.M. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period); provided,
however, if more than one rate is specified on Reuters LIBOR01 Page, the applicable rate shall be the arithmetic mean of all such rates) and (b) 3.50%. 
           "LIBOR Advance" means an Advance bearing interest determined with reference to LIBOR. 
           "LIBOR Business Day" means a Business Day on which dealings in Dollars are carried on in the London interbank market and on which commercial banks are open for
business in London. 
           "Lien" shall mean, with respect to any property of any Person, any mortgage, lien, deed of
trust, hypothecation, fiduciary transfer of title, assignment by way of security, pledge, charge, lease, sale and lease-back arrangement, easement, servitude, trust arrangement, or security interest or encumbrance of any kind in respect of such
property, or any preferential arrangement having the practical effect of constituting a security interest with respect to the payment of any obligation with, or from the proceeds of, any property of any kind (and a Person shall be deemed to own
subject to a Lien any property that it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such property). 
           "Loan Documents" means (i) this Agreement, (ii) the Notes, if any, (iii) the Collateral Documents,
(iv) the DIP Financing Orders and (v) any other document, agreement or instrument executed and delivered by a Credit Party pursuant to the Loan Documents, in each case as amended, supplemented or otherwise modified from time to time in
accordance with the terms thereof. 
           "Material Adverse Effect" means a material adverse effect on (a) the
business, financial or other condition, operations or properties of the Borrowers and their Subsidiaries, taken as a whole, (b) the rights and remedies of the Administrative Agent or any Lender under any Loan Document or (c) the ability of
any Credit Party to perform its Obligations under any Loan Document to which it is or is to be a party; provided that events, developments and circumstances disclosed in public filings and press releases of the Parent and any other events of
information made available in writing to the Administrative Agent, in each case at least three days prior to the Closing Date, shall not be considered in determining whether a Material Adverse Effect has occurred, although subsequent events,
developments and circumstances relating thereto may be considered in determining whether or not a Material Adverse Effect has occurred. 
           "Material Real Property" shall mean any contiguous parcels of real property owned by a Credit Party in fee simple and having a book value of $25,000,000 or more.

           "Material Subsidiary" means, at any time, a Subsidiary of any Borrower having assets in an amount equal to at
least 5% of the amount of total Consolidated and combined assets of Bowater, Newsprint South and their respective Subsidiaries or revenues or net income in an amount equal to at least 5% of the amount of total combined revenues or net income of
Bowater, Newsprint South and their respective Subsidiaries. 
 
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           "Maturity Date" means the earliest of (i) if the Final Order has not been entered by the US Bankruptcy Court, the 45th day following the Closing Date, (ii) twelve months following the Closing Date; provided, however, that such date shall be extended to fifteen months following the Closing
Date if, as of the last day of the twelfth month following the Closing Date, the Credit Parties shall have filed Reorganization Plans in the Cases; provided, further, that such date shall be extended to eighteen months following the
Closing Date if, as of the last day of the fifteenth month following the Closing Date, the Credit Parties shall be using best efforts to pursue confirmation of the Reorganization Plans described in the first proviso of this clause and seeking entry
of the Confirmation Order, (iii) the effective date of the Reorganization Plans and (iv) the acceleration of the loans and termination of the commitments hereunder. 
           "Moody's" shall mean Moody's Investors Service, Inc., or any successor organization thereto. 
           "Mortgages" has the meaning specified in Section 5.01(n)(I)(i). 
           "Mortgage Policies" has the meaning specified in Section 5.01(n)(I)(ii). 
           "Multiemployer Plan" means a multiemployer plan, as defined in Section 4001(a)(3) of ERISA, to which any Credit Party or any ERISA Affiliate is making or
accruing an obligation to make contributions, or has within any of the preceding five plan years made or accrued an obligation to make contributions. 
           "Multiple Employer Plan" means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Credit
Party or any ERISA Affiliate and at least one Person other than the Credit Parties and the ERISA Affiliates or (b) was so maintained and in respect of which any Credit Party or any ERISA Affiliate could have liability under Section 4064 or
4069 of ERISA in the event such plan has been or were to be terminated. 
           "Net Cash Proceeds" means, as
applicable; 
           (a) with respect to any Asset Disposition, the gross cash proceeds received by the Parent or any of its
Subsidiaries therefrom less the sum of the following, without duplication: (i) selling expenses incurred in connection with such Asset Disposition (including reasonable brokers' fees and commissions, legal, accounting and other professional
and transactional fees, transfer and similar taxes and the Parent's reasonable good faith estimate of income taxes paid or payable in connection with such sale), (ii) the principal amount, premium or penalty, if any, interest and other amounts
on any Debt (including, without limitation, Debt under the Existing Facilities) secured by a Lien having priority to the Lien of the Collateral Agent on the assets (or a portion thereof) sold in such Asset Disposition, which Debt is repaid with such
proceeds, (iii) reasonable reserves with respect to post-closing adjustments, indemnities and other contingent liabilities established in connection with such Asset Disposition (provided that, to the extent and at the time any such
amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds), and (iv) the Parent's reasonable good faith estimate of cash payments required to be made within ninety (90) days of such Asset Disposition with
respect to retained liabilities directly related to the assets (or a portion thereof) sold in such Asset Disposition (provided that, to the extent that cash proceeds are not used to make payments in respect of such retained liabilities within
ninety (90) days of such Asset Disposition, such cash proceeds shall constitute Net Cash Proceeds); 
           (b) with
respect to any Insurance and Condemnation Event, the gross cash proceeds received by the Parent or any of its Subsidiaries therefrom less the sum of the following, without 
 
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 duplication: (i) all fees
and expenses in connection therewith and (ii) the principal amount, premium or penalty, if any, interest and other amounts on any Debt secured by a first priority Lien on the assets (or a portion thereof) subject to such Insurance and
Condemnation Event, which Debt is repaid in connection therewith; and 
           (c) with respect to any issuance of Debt for
borrowed money, the gross cash proceeds received by the Parent or any of its Subsidiaries therefrom less all legal, underwriting and other fees and expenses incurred in connection therewith. 
           "Newsprint South" means Bowater Newsprint South LLC, a Delaware limited liability company. 
           "Note" means a promissory note made by the Borrowers in favor of a Lender evidencing Loans made by such Lender,
substantially in the form of Exhibit F. 
           "Notice of Borrowing" means a notice of a borrowing, which shall
be by telephone, confirmed immediately in writing, or telex or telecopier, in substantially the form of Exhibit B hereto, specifying therein the requested (i) date of such Borrowing, (ii) the Type of Advance, (iii) aggregate amount of
such Advance and (iv) in the case of a LIBOR Advance, the initial Interest Period for each such Advance. 
           "Obligations" means, in each case, whether now in existence or hereafter arising: (a) the principal of and interest on (including interest accruing after the
filing of any bankruptcy or similar petition) the Advances, and (b) all other fees and expenses (including reasonable attorneys' fees), charges, indebtedness, loans, liabilities, financial accommodations, obligations, covenants and duties owing
by the Borrowers or any of their respective Subsidiaries to the Lenders, the Collateral Agent or the Administrative Agent, in each case under any Loan Document, of every kind, nature and description, direct or indirect, absolute or contingent, due
or to become due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any Note. 
           "Patents" has the meaning specified in Section 9.01(g)(i). 
           "PBGC" means the Pension Benefit Guaranty Corporation or any successor agency. 
           "Permitted Liens" means Liens expressly permitted under Section 5.02(a). 
           "Person" means any individual, partnership (whether general or limited), corporation (including a business trust), joint stock company, limited liability company,
trust, estate, association, custodian, nominee, joint venture or other entity, or a government or any political subdivision or agency thereof. 
           "Pledged Debt" has the meaning specified in Section 9.01(e)(iv). 
           "Pledged Equity" has the meaning specified in Section 9.01(e)(iii). 
           "Pledged Investment Property" has the meaning specified in Section 9.01(e)(v). 
           "Post-Petition Interest" has the meaning specified in Section 6.06. 
 
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           "PPSA" means Personal Property Security Act (Ontario) or any successor statute or similar legislation of any other Canadian jurisdictions, including the
provisions of the Civil Code of Quebec of general application of taking security in movable property in the province of Quebec. 
           "Prepetition Debt" means (a) all Debt under the Existing Facilities and (b) all other Debt of the Credit Parties outstanding immediately prior to the
commencement of the Cases. 
           "Prepetition Lenders" means the lenders under the Existing Facilities. 
           "Primary Guarantor" means each of the Guarantors listed in Part 1 of Schedule II. 
           "QSPE" means each of the following: (a) Calhoun Note Holdings AT LLC, (b) Calhoun Note Holdings TI LLC,
(c) Bowater Catawba Note Holdings I LLC, (d) Bowater Catawba Note Holdings II LLC, (e) Bowater Saluda Note Holdings LLC, (f) Timber Note Holding LLC and (g) any other qualified special purpose entity created to facilitate
the sale and/or the monetization of receivables from the sale of timberlands. 
           "Real Property Collateral" has
the meaning specified in Section 9.01(h). 
           "Recognition Orders" means the Canadian DIP Recognition Order
and, following the entry of the Final Order, the Canadian Second DIP Recognition Order. 
           "Related Parties"
means, with respect to any Person, such Person's Affiliates and such Person's and such Person's Affiliates' respective partners, directors, officers, employees, agents and advisors. 
           "Reorganization Plan" means a Chapter 11 plan of reorganization and/or a plan of compromise or arrangement under the CCAA in any of the Cases of the relevant
Borrowers or Guarantors, in each case in form and substance reasonably acceptable to the Required Lenders. 
           "Responsible
Officer" means the chief executive officer, president, chief financial officer, controller or treasurer of a Credit Party or any Person exercising managerial responsibilities equivalent to the foregoing. Any document delivered hereunder or
under any other Loan Document that is signed by a Responsible Officer of a Credit Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or or other action on the part of such Credit Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of such Credit Party. 
           "Required
Lenders" means, at any time, Lenders owed or holding at least a majority in interest of the sum of the aggregate principal amount of the Advances outstanding at such time. 
           "Secondary Guarantor" means each of the Guarantors listed in Part 2 of Schedule II. 
           "Secured Parties" means the Administrative Agent, the Collateral Agent and the Lenders. 
           "Secured Obligations" has the meaning specified in Section 9.01. 
           "Single Employer Plan" means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any Credit Party
or any ERISA Affiliate and no Person other than the Credit Parties and the ERISA Affiliates or (b) was so maintained and in respect of which 
 
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 any Credit Party or any ERISA
Affiliate could have liability under Section 4069 of ERISA in the event such plan has been or were to be terminated. 
           "Standard & Poor's" or "S&P" shall mean Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc., or any successor
organization thereto. 
           "Subordinated Obligations" has the meaning specified in Section 6.06. 
           "Subsidiary" of any Person means any corporation, partnership, joint venture, limited liability company, trust or estate of
which (or in which) more than 50% of (a) the issued and outstanding Equity Interests having ordinary voting power to elect a majority of the Board of Directors of such corporation (irrespective of whether at the time Equity Interests of any
other class or classes of such Person shall or might have voting power upon the occurrence of any contingency), (b) the interest in the capital or profits of such limited liability company, partnership or joint venture or (c) the
beneficial interest in such trust or estate is at the time directly or indirectly owned or controlled by such Person, by such Person and one or more of its other Subsidiaries or by one or more of such Person's other Subsidiaries; provided,
however, notwithstanding the foregoing, the terms "Subsidiary" and "Subsidiaries": 
      (a) shall include all Subsidiaries of the Parent
(other than those noted in clause (b) below), including without limitation Bowater, Newsprint South and any other Borrower party hereto; and 
      (b) shall exclude (i) all QSPEs and (ii) all of the Abitibi Entities. 
           "Superpriority Claim" means a claim against the Borrowers and any Guarantor in any of the Cases which is an administrative expense claim having priority over any or
all administrative expenses of the kind specified in Sections 503(b) or 507(b) of the U.S. Bankruptcy Code. 
           "Term
Advance" has the meaning specified in Section 2.01. 
           "Term Borrowing" means a borrowing consisting
of the Term Advances made by the Lenders. 
           "Thirteen Week Forecast" has the meaning set specified in
Section 5.03(f). 
           "Trademarks" has the meaning specified in Section 9.01(g)(ii). 
           "Trade Secrets" has the meaning specified in Section 9.01(g)(v). 
           "Type" refers to the distinction between Base Rate Advances and LIBOR Advances. 
           "UCC" means the Uniform Commercial Code as in effect, from time to time, in the State of New York; provided that, if perfection or the effect of perfection
or non-perfection or the priority of any security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, "UCC" means the Uniform Commercial Code as in
effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or non-perfection or priority. 
           "U.S. Bankruptcy Code" shall have the meaning specified in the Preliminary Statements. 
 
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           "U.S. Bankruptcy Court" has the meaning specified in the Preliminary Statements. 
           "U.S. Borrowers" means Parent and Bowater. 
           "U.S. Guarantors" means Parent, Bowater, Newsprint South and each direct and indirect wholly-owned Subsidiary of Bowater and Newsprint South, respectively,
organized under the laws of a state of the United States of America and which is a debtor in the Chapter 11 Cases, as listed on Schedule II hereto and, as of the date of such requirement, each other Subsidiary organized under the laws of a
state of the United States of America that shall be required to execute and deliver a guaranty pursuant to Section 6.01. 
           "U.S. Term Advance" has the meaning specified in Section 2.01. 
           "Voting Interests" means shares of capital stock issued by a corporation, or equivalent Equity Interests in any other Person, the holders of which are ordinarily,
in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even if the right so to vote has been suspended by the happening of such a contingency. 
           "Withdrawal Liability" has the meaning specified in Part I of Subtitle E of Title IV of ERISA. 
           SECTION 1.02. Interpretation. As used in this Agreement, the words "include", "includes" and
"including" will be deemed to be followed by "without limitation". Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form will be construed to
include the plural and vice versa, unless the context otherwise requires. The words "this Agreement", "herein", "hereof", "hereby", "hereunder" and words of similar import refer
to this Agreement as a whole and not to any particular subdivision unless expressly so limited. All accounting terms not specifically defined herein shall be construed in accordance with GAAP. All other terms used herein but not specifically defined
herein shall have their respective meanings specified in the UCC. 
 ARTICLE II 
 THE FACILITY

           SECTION 2.01. The Facility. The Lenders severally agree, on the terms and conditions hereinafter set forth, to make on
the Closing Date (a) a single advance of $166,000,000 to the U.S. Borrowers (the "U.S. Term Advance") and (b) a single advance of $40,000,000 to Bowater Canada (the "Canadian Term Advance" and, collectively with
the U.S. Term Advance, the "Term Advances"). Such Borrowing shall consist of Term Advances made simultaneously by the Lenders ratably according to their respective Commitments. Amounts borrowed under this Section 2.01 and repaid
or prepaid may not be reborrowed. 
           SECTION 2.02. Repayment of the Advances. The U.S. Borrowers shall repay on the
Maturity Date the principal amount of the U.S. Term Advance then outstanding in full, together with all interest and other amounts required to be paid with respect thereto pursuant to Sections 2.08(c) and 2.12 in connection with such repayment.
Bowater Canada shall repay on the Maturity Date the principal amount of the Canadian Term Advance then outstanding in full, together with all interest and other 
 
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 amounts required to be paid
with respect thereto pursuant to Sections 2.08(c) and 2.12 in connection with such repayment. 
           SECTION 2.03. Voluntary
Prepayment of the Advances. The Borrowers may, upon at least five Business Days' notice (or such shorter notice period agreed by the Lenders) to the Administrative Agent, stating the proposed date and the aggregate principal amount of the
prepayment, prepay the outstanding principal amount of the Advances in whole or in part, together with all interest and other amounts required to be paid pursuant to Sections 2.08(c) and 2.12 in connection with such prepayment. 
           SECTION 2.04. Mandatory Prepayment of the Advances. Each Borrower shall, within three Business Days of receipt by the Parent or
any Bowater Entity of Net Cash Proceeds arising from (i) any Asset Disposition in respect of a sale or other disposition of any property or assets of the Parent or any Bowater Entity (including any sale of any Equity Interests in the Abitibi
Entities) but excluding any Asset Disposition permitted by clauses (i), (iii) - (v) or (vii) of Section 5.02(h), (ii) any Insurance and Condemnation Event with respect to any property of the Parent or any Bowater Entity to the extent
resulting in the receipt of Net Cash Proceeds in excess of $5,000,000, or (iii) proceeds from the incurrence of Debt for borrowed money by the Parent or any Bowater Entity in excess of $5,000,000 (other than Debt permitted by
Section 5.02(b)), immediately pay or cause to be paid to the Administrative Agent for the account of the Lenders an amount equal to 100% of such Net Cash Proceeds; provided, however, that, so long as no Event of Default shall be
continuing, any Credit Party may (A) with respect to any Net Cash Proceeds received in connection with the sale of any equipment in the ordinary course of business, upon any such receipt, reinvest such Net Cash Proceeds to acquire replacement
equipment and (B) with respect to any Net Cash Proceeds received in connection with any Insurance and Condemnation Event, upon any such receipt, reinvest such Net Cash Proceeds to replace or repair the property or assets lost or damaged, in
each case, within the earlier of (i) the Maturity Date and (ii) 90 days following the date of receipt of such Net Cash Proceeds; provided, further, that no repayment shall be required hereunder as a result of any Net
Cash Proceeds received by a Subsidiary that is not wholly-owned except to the extent such Net Cash Proceeds are distributed to a Borrower or a wholly-owned Subsidiary of a Borrower. 
           SECTION 2.05. Scheduled Interest. The Borrowers shall pay interest on the unpaid principal amount of the Advances from the Borrowing Date until such principal amount shall
be paid in full, in arrears monthly, and (with respect to LIBOR Advances) at the end of each Interest Period, and on the date that such Advances are Converted or repaid in full, at the following rates per annum: 
      (a) Base Rate Advances. During such periods as such Advance is a Base Rate Advance, a rate per annum equal at all times to the sum of
(i) the Base Rate in effect from time to time plus (ii) the Applicable Margin in effect from time to time. 
      (b) LIBOR
Advances. During such periods as such Advance is a LIBOR Advance, a rate per annum equal at all times during each Interest Period for such Advance to the sum of (A) LIBOR for such Interest Period for such Advance plus (B) the
Applicable Margin in effect on the first day of such Interest Period. 
           SECTION 2.06. Conversion of Advances.
(a) The Borrowers may on any Business Day, upon notice given to the Administrative Agent not later than 11:00 a.m. (New York City time) on the third Business Day prior to the date of the proposed Conversion and subject to the provisions of
Sections 2.05 and 2.13, Convert all or any portion of the Advances of one Type comprising the same Borrowing into Advances of the other Type; provided, however, that any Conversion of LIBOR Advances into Base Rate Advances shall
be effective only on the last day of an Interest Period for such 
 
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 LIBOR Advances. Each such
notice of Conversion shall, within the restrictions specified above, specify (i) the date of such Conversion, (ii) the Advances to be Converted and (iii) if such Conversion is into LIBOR Advances, the duration of the initial Interest
Period for such Advances. Each notice of Conversion shall be irrevocable and binding on the applicable Borrower. 
           (b) If
a Borrower shall fail to select the duration of any Interest Period for any LIBOR Advance in accordance with the provisions contained in the definition of "Interest Period" in Section 1.01, the Administrative Agent will forthwith so notify such
Borrower and the Lenders, whereupon each such LIBOR Advance will automatically, on the last day of the then existing Interest Period therefor, Convert into a Base Rate Advance. 
           (c) Upon the occurrence and during the continuance of an Event of Default, (x) each LIBOR Advance will automatically, on the last day of the then existing Interest
Period therefor, Convert into a Base Rate Advance and (y) the obligation of the Lenders to make, or to Convert Advances into, LIBOR Advances shall be suspended. 
           SECTION 2.07. Default Interest. (a) Upon the occurrence and during the continuance of an Event of Default, the Borrowers shall pay interest ("Default
Interest") on (i) the unpaid principal amount of the Advances, payable in arrears on the dates referred to in Section 2.05 and on demand, at a rate per annum equal at all times to 2% per annum above the applicable rate per annum
required to be paid pursuant to Section 2.05 and (ii) to the fullest extent permitted by law, the amount of any interest, fee or other amount payable hereunder that is not paid when due, from the date such amount shall be due until such
amount shall be paid in full, payable in arrears on the date such amount shall be paid in full and on demand, at a rate per annum equal at all times to 2% per annum above the applicable rate per annum required to be paid pursuant to
Section 2.05. 
           (b) Anything set forth in this Agreement to the contrary notwithstanding, in no event shall the rate
of interest payable by the Borrower on any amount hereunder cause the total amount of interest payable on the principal amount of the Advances to exceed the maximum amount permitted by Applicable Law. 
           SECTION 2.08. Payments and Computations; Additional Amounts. 
           (a) Computations of Interest. All computations of interest based on the Base Rate shall be made by the Administrative Agent on the basis of a year of 365 or 366 days,
as the case may be, and all computations of interest based on LIBOR and fees shall be made by the Administrative Agent on the basis of a year of 360 days, in each case for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest or fees are payable. Each determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error. 
           (b) Agent's Account. The Borrowers shall make each payment hereunder no later than 11:00 A.M. (New York City time) on the day
when due in immediately available Dollars, to such account of the Administrative Agent as the Administrative Agent shall have notified the Borrowers, for the ratable account of the Lenders. 
           (c) Additional Amounts. All payments of principal with respect to the Advances under this Agreement (whether at maturity, on prepayment or otherwise) shall be made
together with (without duplication) (i) all accrued interest thereon to the date of such payment or prepayment on the 
 
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 principal amount paid or
prepaid and (ii) any expenses and break costs then due and owing hereunder pursuant to Section 10.04(c). 
           (d)
Notice. Each unscheduled payment under this Agreement shall be accompanied by written notice from the Borrowers identifying the nature of the payment. 
           (e) Interest Act (Canada). With respect to Advances made to Bowater Canada, whenever a rate of interest hereunder is calculated on the basis of a year (the "deemed year")
which contains fewer days than the actual number of days in the calendar year of calculation, such rate of interest shall be expressed as a yearly rate for purposes of the Interest Act (Canada) by multiplying such rate of interest by the actual
number of days in the calendar year of calculation and dividing it by the number of days in the deemed year. 
           SECTION 2.09.
Evidence of Debt. The Administrative Agent shall maintain an account or accounts evidencing the indebtedness of the Borrowers to each Lender with respect to the Advance and this Agreement, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder; provided that the failure to so maintain any such account shall not impair any obligation of the Borrowers to such Lender. Upon the request of any Lender made through the
Administrative Agent, the Borrowers shall execute and deliver to such Lender (through the Administrative Agent) a Note, which shall evidence such Lender's Advances in addition to such accounts or records. Each Lender may attach schedules to its Note
and endorse thereon the date, amount and maturity of its Advances and payments with respect thereto. 
           SECTION 2.10.
Incremental Facility; ABL Facility. 
           (a) The Borrowers may, at any time and from time to time after the Closing
Date and prior to the Maturity Date, by notice to the Administrative Agent, request the addition of one or more new term loan facilities or an increase in the Commitments (each of such commitment increases and any such new term loan facility being
an "Incremental Facility") to be effective as of a date (the "Increase Date") specified in the related notice to the Administrative Agent; provided, however, that (i) in no event shall the aggregate
amount of all Incremental Commitments exceed $360,000,000 minus the outstanding principal amount of the Term Advance; (ii) on the date of any request by a Borrower for an Incremental Commitment and on the related Increase Date, the
applicable conditions set forth in Section 3.02 and in clause (d) of this Section 2.10 shall be satisfied; (iii) after giving effect to the incurrence of any Incremental Facility, the Borrowers shall be in pro forma compliance
with all financial covenants set forth in Section 5.04; (iv) the terms of any such Incremental Facility shall be the same as the terms of the Term Facility (or may be on terms more favorable to the Secured Parties than those applicable to
the Term Facility so long the Loan Documents are amended to apply such terms to the Term Facility) and such Incremental Facility shall form part of the Term Facility for all purposes; (v) each Lender shall have the right, but not the
obligation, to commit to provide all or a portion of any Incremental Facility (the amount of such portion being subject to clause (b) below); (vi) subject to the DIP Financing Orders, the Loan Documents may be amended by the Administrative
Agent, the Lenders and the Credit Parties, if necessary, to provide for terms applicable to each Incremental Commitment consistent with the terms hereof and (vii) the Required Lenders in their sole discretion shall be satisfied that the Lender
Priority Collateral is sufficient to support the DIP Facility as increased by any such Incremental Facility. 
           (b) The
Administrative Agent shall promptly notify the Lenders of a request by a Borrower for an Incremental Facility, respectively, which notice shall include (i) the proposed amount of such requested Incremental Commitment, (ii) the proposed
Increase Date and (iii) the date by which the relevant Lenders wishing to participate in the Incremental Commitment must commit to an increase in the amount of their respective Commitments (which shall in no event be less than ten Business Days
from the 
 
26
 

  

  
 
  
 date of delivery of such
notice to the relevant Lenders) (the "Incremental Commitment Date"). Each relevant Lender that is willing, in its sole discretion, to participate in the requested Incremental Commitment (each an "Increasing Lender") shall
give written notice to the Administrative Agent on or prior to the Incremental Commitment Date of the amount by which it is willing to commit to the Incremental Facility. Any Lender not responding within such time period shall be deemed to have
declined to participate in the requested Incremental Commitment. If the relevant Lenders notify the Administrative Agent that they are willing to participate in an Incremental Commitment by an aggregate amount that exceeds the amount of the
requested Incremental Commitment, the requested Incremental Commitment shall be allocated among the relevant Lenders willing to participate therein based on their ratable shares of the Advances under the Term Facility. 
           (c) Promptly following the applicable Incremental Commitment Date, the Administrative Agent shall notify the Borrower as to the
amount, if any, by which the relevant Lenders are willing to participate in the requested Incremental Commitment. If the aggregate amount by which the Lenders are willing to participate in the requested Incremental Commitment on any such Incremental
Commitment Date is less than the requested Incremental Commitment, then the Borrowers may extend offers to one or more Eligible Assignees to participate in any portion of the requested Incremental Commitment that has not been committed to by the
relevant Lenders as of the Incremental Commitment Date; provided, however, that (i) the Commitment of each such Eligible Assignee shall be in an amount equal to at least $1,000,000 and (ii) each such Eligible Assignee shall
be subject to the approval of the Administrative Agent and FFH (which approval shall not be unreasonably withheld or delayed). 
           (d) On the applicable Increase Date, each Eligible Assignee that accepts an offer to participate in a requested Incremental Commitment in accordance with
Section 2.10(c) (each such Eligible Assignee, an "Assuming Lender") shall become a Lender to this Agreement as of the applicable Increase Date and the Commitment of each Increasing Lender for such Incremental Commitment shall be
so increased by such amount (or by the amount allocated to such Lender pursuant to the last sentence of Section 2.10(b)) as of such Increase Date; provided, however, that the Administrative Agent shall have received on or before
the Increase Date the following, each dated such date: 
      (i) certified copies of resolutions of the board of directors of the Credit Parties
approving the applicable Incremental Commitment and the corresponding modifications to this Agreement; 
      (ii) an assumption agreement from
each Assuming Lender, if any, in form and substance satisfactory to the Borrowers and the Administrative Agent (each a "Commitment Assumption Agreement"), duly executed by such Eligible Assignee, the Administrative Agent and each
Borrower; 
      (iii) confirmation from each Increasing Lender of the increase in the amount of its Commitment in a writing satisfactory to the
Borrower and the Administrative Agent; and 
      (iv) orders of the Bankruptcy Courts approving such Incremental Facility in form and substance
acceptable to the Required Lenders in their sole discretion. 
 On the applicable Increase Date, upon fulfillment of the conditions set forth in the immediately preceding sentence of this
Section 2.10(d), the Administrative Agent shall notify the Lenders (including, without limitation, each Assuming Lender) and the Borrowers, on or before 1:00 p.m. (New York City time), by telecopier or telex, of the occurrence of the applicable
Incremental Commitment to be effected on the related Increase Date and shall record in the Register the relevant information with respect to each Increasing Lender and each Assuming Lender on such date. 
 
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           (e) The Borrowers may, at any time and from time to time after the Closing Date and prior to the Maturity Date, by notice to the Administrative Agent, request that an ABL
Facility be incorporated into the DIP Facility. The approval of the addition of an ABL Facility to the DIP Facility shall be at the discretion of the Initial Lenders and, if so approved, shall be reflected in amendments to the Loan Documents adopted
in accordance with Section 10.01. 
           SECTION 2.11. Use of Proceeds. The proceeds of the Advances shall be available
(and each Borrower agrees that it shall use such proceeds) solely (i) to pay transaction costs, fees and expenses, which are incurred in connection with this Agreement, (ii) for working capital purposes, (iii) to pay adequate
protection to holders of Debt under the Existing Facilities, as set forth in the DIP Financing Orders, and (iv) for other general corporate purposes of the Borrowers and their Subsidiaries, provided, however, that the proceeds of
the Advances shall not be used to repay Prepetition Debt. 
           SECTION 2.12. Fees. 
           (a) Closing Fees. The Borrowers shall pay fees (the "Closing Fees") to each Lender, as fee compensation for the
funding of such Lender's Term Advances, in an amount equal to 2.0% of the stated principal amount of such Lender's Term Advances, earned when funded and payable to such Lender out of the proceeds of its Term Advances; provided that
(i) 50% of such Closing Fees shall be payable to such Lender upon entry of the Interim Order and (ii) 50% of such Closing Fees shall be deposited into an escrow account (on terms acceptable to the Initial Lenders) and funded to such Lender
upon the earlier of (x) the Maturity Date and (y) the U.S. Bankruptcy Court entering the Final Order; provided however, that in the case of any Incremental Facility, 100% of the closing fees agreed in connection therewith
shall be earned and payable upon the funding of such Incremental Facility. The Closing Fees, once paid, shall be non-refundable in all circumstances. 
           (b) Upfront Fee. The Borrowers shall pay an upfront fee to the Administrative Agent for the account of the Lenders, on the Closing Date, in an amount equal to 3.0% of the
stated principal amount of the Term Advance. Such upfront fee, once paid, shall be non-refundable in all circumstances. 
           (c)
Extension Fees. The Borrowers shall pay the following extension fees to the Administrative Agent for the account of the Lenders: 
      (i) if the Maturity Date is extended past twelve months pursuant to the definition thereof, the Borrowers shall pay an extension fee equal to 0.5% of the aggregate amount of Advances made by each Lender
hereunder payable on the date that is twelve months following the Closing Date; and 
      (ii) in addition, if the Maturity Date is extended
past fifteen months pursuant to the definition thereof, the Borrowers shall pay an extension fee equal to 0.5% of the aggregate amount of Advances made by each Lender hereunder payable on the date that is fifteen months following the Closing Date.

 Each such extension fee, once paid, shall be non-refundable in all circumstances. 
           (d) Exit Fees. The Borrowers shall pay fees (the "Exit Fees") to each Lender in an amount equal to 2.0% of the aggregate amount of Advances made by such
Lender hereunder upon the earlier of (i) the Maturity Date and (ii) repayment in full of all Obligations hereunder. The Exit Fees, once paid, shall be non-refundable in all circumstances. 
 
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           SECTION 2.13. Increased Costs, Etc. If, after the date hereof, due to either (i) the introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central bank or other governmental authority (whether or not having the force of law), there shall be any increase in the cost to any Lender of agreeing to make or of
making, funding or maintaining a LIBOR Advance (excluding, for purposes of this Section 2.13, any such increased costs resulting from (x) Taxes or Other Taxes (as to which Section 2.14 shall govern) and (y) changes in the basis
of taxation of overall net income or overall gross income by the United States or by the foreign jurisdiction or state under the laws of which such Lender is organized or has its Lending Office or any political subdivision thereof), then the
Borrowers shall from time to time, within 2 Business Days of demand by such Lender (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender additional amounts sufficient to compensate
such Lender for such increased cost; provided, however, that a Lender claiming additional amounts under this Section 2.13 agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions)
to designate a different Lending Office if the making of such a designation would avoid the need for, or reduce the amount of, such increased cost that may thereafter accrue and would not, in the reasonable judgment of such Lender, be otherwise
disadvantageous to such Lender; provided, further, that no Borrower or Credit Party shall be obligated to compensate any Lender for any such increased cost that accrued more than 12 months prior to the date such Lender notified by
Borrowers of such increased cost. A certificate as to the amount of such increased cost, submitted to the Borrower by such Lender, shall be conclusive and binding for all purposes, absent manifest error. 
           SECTION 2.14. Taxes. (a) Except as otherwise provided herein, any and all payments by any Credit Party to or for the account
of any Lender or the Administrative Agent (each an "Indemnified Party") hereunder or under any other Loan Document shall be made, in accordance with Section 2.08 or the applicable provisions of such other Loan Document, if any,
free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto, excluding, in the case of each Indemnified Party, Excluded
Taxes (all such non-excluded taxes, levies, imposts, deductions, charges, withholdings being hereinafter referred to as "Taxes"). If any Credit Party shall be required by law to deduct any Taxes from or in respect of any sum payable
hereunder or under any other Loan Document to any Indemnified Party (i) the sum payable by such Credit Party shall be increased as may be necessary so that after all required deductions (including deductions applicable to additional sums
payable under this Section 2.14) such Indemnified Party receives an amount equal to the sum it would have received had no such deductions been made, (ii) such Credit Party shall make all such deductions and (iii) such Credit Party
shall pay the full amount deducted to the relevant taxing authority or other authority in accordance with applicable law. 
           (b) In addition, each Credit Party shall pay any present or future sales stamp, documentary, excise, property, intangible, mortgage recording or similar taxes, charges or
levies that arise from any payment made by such Credit Party hereunder or under any other Loan Documents or from the execution, delivery or registration of, performance under, or otherwise with respect to, this Agreement or the other Loan Documents
(hereinafter referred to as "Other Taxes"). 
           (c) The Credit Parties shall indemnify each Indemnified Party
for and hold them harmless on an after-tax basis against the full amount of Taxes and Other Taxes (including, without limitation, Taxes of any kind imposed on or paid by such Indemnified Party) and any liability (including penalties, additions to
tax, interest and expenses) arising therefrom or with respect thereto whether or not such Taxes or Other Taxes were correctly or legally asserted. This indemnification shall be made within 30 days from the date such Lender or the Administrative
Agent (as the case may be) makes written demand therefor, which written demand shall be accompanied by copies of the applicable documentation evidencing the amount of such taxes. 
 
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           (d) Within 30 days after the date of any payment of Taxes, the appropriate Credit Party shall furnish to the Administrative Agent, at its address referred to in
Section 10.02, the original or a certified copy of a receipt evidencing such payment, to the extent such a receipt is issued therefor, or other written proof of payment thereof that is reasonably satisfactory to the Initial Lenders. In the case
of any payment hereunder or under the other Loan Documents by or on behalf of a Credit Party through an account or branch outside the United States or by or on behalf of a Credit Party by a payor that is not a United States person, if such Credit
Party determines that no Taxes are payable in respect thereof, such Credit Party shall furnish, or shall cause such payor to furnish, to the Administrative Agent, at such address, an opinion of counsel acceptable to the Administrative Agent stating
that such payment is exempt from Taxes. For purposes of subsections (d) and (e) of this Section 2.14, the term "United States person" shall have the meanings specified in Section 7701 of the Internal Revenue Code.

           (e) Each Lender organized under the laws of a jurisdiction outside the United States shall, on or prior to the date of
its execution and delivery of this Agreement in the case of the Initial Lenders and on the date of the Assignment and Acceptance pursuant to which it becomes a Lender in the case of each other Lender, and from time to time thereafter as reasonably
requested in writing by the Borrowers (but only so long as such Lender remains lawfully able to do so), provide the Administrative Agent, the Initial Lenders and the Borrowers with two original properly completed Internal Revenue Service Forms
W-8BEN, W-8IMY or W-8ECI, as appropriate, or any successor or other form prescribed by the Internal Revenue Service, certifying that such Lender is exempt from or entitled to a reduced rate of United States withholding tax on payments pursuant to
this Agreement or the other Loan Documents or, in the case of a Lender that has certified that it is not a "bank" as described above, certifying that such Lender is a foreign corporation, partnership, estate or trust. Each Lender claiming exemption
from withholding tax pursuant to the portfolio interest exception set forth in sections 871(h) and 881(c) of the Code shall provide the Administrative Agent, the Initial Lender and the Borrowers such forms, certificates or documents required by the
Internal Revenue Service to establish entitlement to such exemption. If the forms provided by a Lender at the time such Lender first becomes a party to this Agreement indicate a United States interest withholding tax rate in excess of zero,
withholding tax at such rate shall be considered excluded from Taxes unless and until such Lender provides the appropriate forms certifying that a lesser rate applies, whereupon withholding tax at such lesser rate only shall be considered excluded
from Taxes for periods governed by such forms; provided, however, that if, at the effective date of the Assignment and Acceptance pursuant to which a Lender becomes a party to this Agreement, the Lender assignor was
entitled to payments under subsection (a) of this Section 2.14 in respect of United States withholding tax with respect to interest paid at such date, then, to such extent, the term Taxes shall include (in addition to withholding taxes
that may be imposed in the future or other amounts otherwise includable in Taxes) United States withholding tax, if any, applicable with respect to the Lender assignee on such date. If any form or document referred to in this subsection
(e) requires the disclosure of information, other than information necessary to compute the tax payable and information required on the date hereof by Internal Revenue Service Form W-8BEN, W-8IMY, W-8ECI or any successor, or the related
certificate described above, that the applicable Lender reasonably considers to be confidential, such Lender shall give notice thereof to the Borrower and shall not be obligated to include in such form or document such confidential information.

           (f) For any period with respect to which a Lender has failed to provide the Borrowers with the appropriate form,
certificate or other document described in subsection (e) above (other than if such failure is due to a change in law, or in the interpretation or application thereof, occurring after the date on which a form, certificate or other
document originally was required to be provided or if such form, certificate or other document otherwise is not required under subsection (e) above), such Lender shall not be entitled to increased payment or indemnification under subsection
(a) or (c) of this Section 2.14 with respect to taxes imposed by the United States by reason of such failure; provided, however, that should a Lender become subject to taxes because of its failure to deliver a form,

 
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 certificate or other document
required hereunder, the Credit Parties shall take such steps as such Lender shall reasonably request to assist such Lender to recover such taxes. 
           (g) If any Lender determines, in its sole discretion, that it has actually and finally realized by reason of the refund or credit (but not any foreign tax credits) of any
Taxes indemnified pursuant to this Section 2.14, a current monetary benefit that would result in the total payments under this Section 2.14 exceeding the amount needed to fully indemnify such Lender on an after-tax basis, such Lender shall
pay to the Borrowers or other Credit Party, as appropriate, with reasonable promptness, an amount equal to the lesser of the amount of such benefit or the amount of such excess, net of all expenses in securing such refund. 
           SECTION 2.15. Sharing of Payments, Etc. If any Lender shall obtain at any time any payment (whether voluntary, involuntary,
through the exercise of any right of set-off, or otherwise, other than as a result of an assignment pursuant to Section 10.07 other than to a Credit Party as assignee (i) on account of Obligations due and payable to such Lender hereunder
and under the other Loan Documents at such time in excess of its ratable share (according to the proportion of (x) the amount of such Obligations due and payable to such Lender at such time to (y) the aggregate amount of the Obligations
due and payable to all Lenders hereunder and under the other Loan Documents at such time) of payments on account of the Obligations due and payable to all Lenders hereunder and under the other Loan Documents at such time obtained by all the Lenders
at such time or (ii) on account of Obligations owing (but not due and payable) to such Lender hereunder and under the other Loan Documents at such time in excess of its ratable share (according to the proportion of (x) the amount of such
Obligations owing to such Lender at such time to (y) the aggregate amount of the Obligations owing (but not due and payable) to all Lenders hereunder and under the other Loan Documents at such time) of payments on account of the Obligations
owing (but not due and payable) to all Lenders hereunder and under the other Loan Documents at such time obtained by all of the Lenders at such time, such Lender shall forthwith purchase from the other Lenders such interests or participating
interests in the Obligations due and payable or owing to them, as the case may be, as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each of them; provided, however, that if all or any
portion of such excess payment is thereafter recovered from such purchasing Lender, such purchase from each other Lender shall be rescinded and such other Lender shall repay to the purchasing Lender the purchase price to the extent of such Lender's
ratable share (according to the proportion of (x) the purchase price paid to such Lender to (y) the aggregate purchase price paid to all Lenders) of such recovery together with an amount equal to such Lender's ratable share (according to
the proportion of (x) the amount of such other Lender's required repayment to (y) the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing Lender in respect of the total
amount so recovered. The Credit Parties agree that any Lender so purchasing an interest or participating interest from another Lender pursuant to this Section 2.15 may, to the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off) with respect to such interest or participating interest, as the case may be, as fully as if such Lender were the direct creditor of the Credit Parties in the amount of such interest or participating interest, as the
case may be. 
 ARTICLE III 
 CONDITIONS TO EFFECTIVENESS 
           SECTION 3.01. Conditions Precedent to the Closing Date. This Agreement shall become effective on and as of the first date (the
"Closing Date") on which the following conditions precedent have been satisfied (and the obligation of each Lender to make the Advances hereunder is subject to the satisfaction of such conditions precedent before or concurrently with
the Closing Date): 
 
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           (a) The Administrative Agent and FFH shall have received on or before the Closing Date the following, each dated such day (unless otherwise specified), in form and substance
reasonably satisfactory to FFH (unless otherwise specified) and in sufficient copies for each Lender: 
      (i) Duly executed counterparts of
this Agreement from each Credit Party. 
      (ii) The Notes payable to the order of the Lenders to the extent requested in accordance with
Section 2.09. 
      (iii) Certified copies of the resolutions of the boards of directors or shareholder(s) of each of the Borrowers and
each Primary Guarantor approving the execution and delivery of this Agreement and each other Loan Document to which it is, or is intended to be a party, and of all documents evidencing other necessary constitutive action and, if any, material
governmental and other third party approvals and consents, if any, with respect to the Reorganization Plan, this Agreement and each other Loan Document. 
      (iv) A copy of the charter or other constitutive document of each Borrower and each Primary Guarantor and each amendment thereto, certified (as of a date reasonably acceptable to FFH) by the Secretary of
State of the jurisdiction (or other Governmental Authority, as applicable) of its incorporation or organization, as the case may be, thereof as being a true and correct copy thereof. 
      (v) A certificate of each Borrower and each Primary Guarantor signed on behalf of such Credit Party by a Responsible Officer or its secretary, dated
the Closing Date (the statements made in which certificate shall be true on and as of the Closing Date), certifying as to (A) the accuracy and completeness of the charter (or other applicable formation document) of such Credit Party and the
absence of any changes thereto; (B) the accuracy and completeness of the bylaws (or other applicable organizational document) of such Credit Party as in effect on the date on which the resolutions of the board of directors (or persons
performing similar functions) of such Person referred to in Section 3.01(a)(iv) were adopted and the absence of any changes thereto (a copy of which shall be attached to such certificate); (C) the absence of any proceeding known to be
pending for the dissolution, liquidation or other termination of the existence of such Credit Party; and (D) the absence of any event occurring and continuing, or resulting from the Advance or the application of proceeds, if any, therefrom,
that would constitute a Default. 
      (vi) A certificate of the Secretary or an Assistant Secretary or other appropriate officer or manager of
each Borrower and each Primary Guarantor certifying the names and true signatures of the officers of such Credit Party authorized to sign this Agreement and the other documents to be delivered hereunder. 
      (vii) The Administrative Agent and FFH shall have received (A) a weekly cash bankruptcy budget for the 13-week period from the commencement of
the Cases, prepared by the Credit Parties and in form and substance acceptable to the FFH in its sole discretion (the "Interim DIP Budget") and (B) draft 2008 audited consolidated financial statements of Parent and its
Subsidiaries. 
 
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      (viii) A Notice of Borrowing for the Borrowing to be made on the Closing Date. 
           (b) The Administrative Agent and the Lenders shall have received (i) satisfactory evidence of the entry of an order of the U.S. Bankruptcy Court substantially in the
form of Exhibit C (the "Interim Order") approving, among other things, the Loan Documents, granting the Superpriority Claim status and other Liens described in Section 4.01(m), providing for an intercreditor arrangement with
the secured parties under the Existing Facilities and including granting of the adequate protection described therein and (ii) satisfactory evidence of the issuance of the Initial CCAA Order substantially in the form of Exhibit D. 

          (c) The Credit Parties shall be in compliance with the orders described in clause (b) above, which shall be in full force
and effect and shall not have been vacated, reversed, modified, amended or stayed without the prior written consent of the Required Lenders (which consent shall not be unreasonably withheld). 
           (d) All of the "first day orders" (including the Interim Order and the Initial CCAA Order) entered by the Bankruptcy Courts at the time of the commencement of the Cases,
related orders, and motions and other documents to be filed with and submitted to the U.S. Bankruptcy Court in connection with this Agreement shall be reasonably satisfactory in form and substance to FFH. 
           (e) No examiner with increased powers to operate the Credit Parties' material businesses or trustee, receiver, interim receiver or
receiver and manager shall have been appointed with respect to any or all of the Credit Parties or their respective properties. 
           (f) The Borrowers shall have paid all fees of the Administrative Agent and the Lenders and all expenses of the Administrative Agent and the Lenders (including the accrued
fees and expenses of counsel to the Administrative Agent and each Initial Lender) due and payable on or prior to the Closing Date. 
           SECTION 3.02. Conditions Precedent to each Borrowing. The obligation of each Lender to make an Advance on the occasion of each Borrowing, shall be subject to the further
conditions precedent that on the date of such Borrowing the following statements shall be true (and each of the giving of the applicable Notice of Borrowing and the acceptance by a Borrower of the proceeds of such Borrowing, shall constitute a
representation and warranty by such Borrower that both on the date of such notice and on the date of such Borrowing such statements are true): 
      (a) the representations and warranties contained in each Loan Document, are correct in all material respects, only to the extent that such representation and warranty is not otherwise qualified by materiality
or Material Adverse Effect on and as of such date, before and after giving effect to such Borrowing and to the application of the proceeds therefrom, as though made on and as of such date, other than any such representations or warranties that, by
their terms, refer to a specific date other than the date of such Borrowing, in which case as of such specific date; and 
      (b) no event has
occurred and is continuing, or would result from such Borrowing or from the application of the proceeds therefrom that constitutes a Default. 
 
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 ARTICLE IV 

REPRESENTATIONS AND WARRANTIES 
           SECTION 4.01.
Representations and Warranties of the Credit Parties. Each Credit Party represents and warrants as follows: 
      (a) Each of the
Borrowers and the Guarantors: (i) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and is duly qualified and in good standing in each jurisdiction in which the failure to so qualify
would reasonably be expected to have a Material Adverse Effect; (ii) subject to the entry of the DIP Financing Orders by the Bankruptcy Courts, has the requisite power and authority to effect the transactions contemplated hereby, and by other
Loan Documents to which it is a party; and (iii) subject to the entry of the DIP Financing Orders and the Recognition Orders by the Bankruptcy Courts, has all requisite power and authority and the legal right to own, pledge or mortgage to the
extent required by the Loan Documents and operate its properties, and to conduct its business as now or currently proposed to be conducted except where the failure thereof would not, in the aggregate, reasonably be expected to have a Material
Adverse Effect. 
      (b) Set forth on Schedule 4.01(b) hereto is a complete and accurate list of all Subsidiaries of the Parent, showing
as of the Closing Date (as to each such Subsidiary) the jurisdiction of its incorporation or organization, as the case may be, the percentage of the Equity Interests owned (directly or indirectly) by the Parent or its Subsidiaries, and whether such
Subsidiary is a Guarantor under this Agreement. 
      (c) Upon the entry of the DIP Financing Orders by the Bankruptcy Courts, the execution,
delivery and performance by each of the Borrowers and the Guarantors of each of the Loan Documents to which it is a party: (i) are within the respective powers of each of the Borrowers and the Guarantors, have been duly authorized by all
necessary action including the consent of shareholders where required, and do not (A) contravene the charter or other organizational documents or by-laws of any of the Borrowers or the Guarantors, (B) violate any law or regulation, or any
order or decree of any court or Governmental Authority, (C) conflict with or result in a breach of, or constitute a default under, any material indenture, mortgage or deed of trust entered into after the Bankruptcy Petition Date or any material
lease, agreement or other instrument entered into after the Bankruptcy Petition Date binding on the Borrowers or the Guarantors or any of their properties, except to the extent that all such violations, conflicts or breaches would not, in the
aggregate, reasonably be expected to have a Material Adverse Effect, or (D) result in or require the creation or imposition of any Lien upon any of the property of any of the Borrowers or the Guarantors other than the Liens granted pursuant to
this Agreement, other Loan Documents or the DIP Financing Orders, and (ii) do not require the consent, authorization by or approval of or notice to or filing or registration with any Governmental Authority other than the entry of the DIP
Financing Orders (other than consents, authorizations, approvals, notices, filings or registrations the failure of which to have been obtained would not, in the aggregate, reasonably be expected to have a Material Adverse Effect). Upon the entry by
the Bankruptcy Courts of the DIP Financing Orders, this Agreement has been duly executed and delivered by each of the Borrowers and the Guarantors. This Agreement is, and each of the other Loan Documents to which the Borrowers and each of the
Guarantors is or will be a party, when delivered hereunder or thereunder, will be, a legal, valid and binding obligation of the Borrowers and each Guarantor, as the case may be, enforceable against the Borrowers and the Guarantors, as the case may
be, in accordance with its terms and the DIP Financing Orders. 
 
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      (d) The applicable DIP Budget and all projected Consolidated balance sheets, income statements and cash flow statements of the Borrower and its Subsidiaries delivered to the Administrative Agent and FFH
pursuant to Section 5.03 were prepared and will be prepared, as applicable, in good faith on the basis of the assumptions stated therein, which assumptions were fair and will be fair in the light of conditions existing at the time of delivery
of such DIP Budget or projections, as the case may be, and represented and will represent, at the time of delivery, the Borrower's good faith estimate of its future financial performance (it being understood that such projections are not a guaranty
or warranty of future financial performance). 
      (e) There is no unstayed action, suit, or proceeding affecting any Credit Party or any of
their Subsidiaries pending or, to the best knowledge of the Credit Parties, threatened before any court, governmental agency or arbitrator that (i) is reasonably expected to be determined adversely to the Credit Party and, if so adversely
determined, would reasonably be expected to have a Material Adverse Effect or (ii) purports to affect the legality, validity or enforceability of this Agreement or any other Loan Document. 
      (f) The Borrowers are not engaged in the business of extending credit for the purpose of purchasing or carrying Margin Stock, and no proceeds of any
Advance will be used to purchase or carry any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock. 
      (g) No ERISA Event has occurred or is reasonably expected to occur with respect to any ERISA Plan that has resulted in or is reasonably expected to result in a Material Adverse Effect. 
      (h) The operations and properties of each Credit Party and each of its Subsidiaries comply and for the past four years, have complied with all
applicable Environmental Laws and Environmental Permits except for non-compliance that could not be reasonably expected to have a Material Adverse Effect or materially impair the value of the Lender Priority Collateral, all past non compliance with
such Environmental Laws and Environmental Permits has been resolved in a manner that could not be reasonably expected to have a Material Adverse Effect or materially impair the value of the Lender Priority Collateral, and, to the best knowledge of
the Credit Parties, no circumstances exist that would be reasonably expected to (i) form the basis of an Environmental Action against any Credit Party or any of its Subsidiaries or any of their properties that could be reasonably expected to
have a Material Adverse Effect or (ii) cause any such property to be subject to any restrictions on ownership, occupancy, use or transferability under any Environmental Law that could be reasonably expected to have a Material Adverse Effect.

      (i) The DIP Financing Orders and the Loan Documents create a valid and perfected security interest in the Collateral having the priority
set forth in the DIP Financing Orders securing the payment of the Secured Obligations. The Credit Parties are the legal and beneficial owners of the Collateral free and clear of any Lien, except for the liens and security interests created or
permitted under the Loan Documents. As of the Closing Date, no Liens exist in favor of the PBGC. 
      (j) Neither the making of any Advances
nor the application of the proceeds or repayment thereof by the Borrowers, nor the consummation of the other transactions contemplated by the Loan Documents, will violate any provision of the Investment Company Act of 1940, as amended, or any rule,
regulation or order of the Securities and Exchange Commission thereunder. 
 
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      (k) Each Credit Party and each of its Subsidiaries has filed or caused to be filed all tax returns and reports (federal, state, local and foreign) which are required to have been filed and has paid or caused
to be paid all taxes required to have been paid by it, together with applicable interest and penalties, except (a) taxes that are being contested in good faith by appropriate proceedings and for which such Borrower or such Subsidiary, as
applicable, has set aside on its books adequate reserves or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect. 
      (l) Prior to the Bankruptcy Petition Date, each Canadian Pension Plan is, and has been, established, registered, qualified, administered and invested,
in material compliance with the terms thereof and all Applicable Law; and no Credit Party has received, within the last seven years, any notice from any Person questioning or challenging such compliance (other than in respect of any claim related
solely to that Person), and no Credit Party has knowledge of any such notice from any Person questioning or challenging such compliance beyond the last seven years. All obligations under any Canadian Pension Plan (whether pursuant to the terms
thereof or Applicable Law) prior to the Bankruptcy Petition Date have been satisfied, and there are no outstanding defaults or material violations thereunder by any Credit Party nor does any Credit Party have knowledge of any default or material
violation by any other party to any Canadian Pension Plan. All contributions or premiums required to be paid to or in respect of each Canadian Pension Plan have been paid in a timely fashion in accordance with the terms thereof and all applicable
law, and no taxes, penalties or fees are owing or exigible under any Canadian Pension Plan. There is no material proceeding, action, suit or claim (other than routine claims for benefits) pending or threatened involving any Canadian Pension Plan or
its assets. No event has occurred prior to the Bankruptcy Petition Date respecting any Canadian Pension Plan which would entitle any Person (without the consent of applicable Credit Party) to wind-up or terminate any Canadian Pension Plan, in whole
or in part, or which could, reasonably be expected to adversely affect the tax status thereof. Any prior withdrawals or transfers of assets from any Canadian Pension Plan have complied with the terms of the relevant Canadian Pension Plan, any
funding arrangement in respect of the Canadian Pension Plan (including all predecessor documents thereto) and any Applicable law or regulatory requirement. 
      (m) Each of the Borrowers hereby represents, warrants and covenants that, except as otherwise expressly provided in this paragraph, upon the entry of the Interim Order (or the Final Order, when applicable),
the Initial CCAA Order and the Recognition Orders, the Secured Obligations will be secured by valid and enforceable security interests in the Collateral (subject to the Carve-Out), and that the DIP Facility and each Loan Document (x) shall at all
times constitute a Superpriority Claim in the Cases of the Borrowers having priority, pursuant to Sections 364(c)(1) and 507(b) of the Bankruptcy Code (subject only to the Carve-Out), over all other claims of any entity, including without
limitation any claims under Sections 105, 326, 328, 330, 331, 503(a), 503(b), 506(c), 507(a), 507(b), 546(c), 546(d), 726 (to the extent permitted by law) 1113 and 1114 of the Bankruptcy Code, (y) pursuant to Section 364(d) of the Bankruptcy
Code shall include a valid, binding, enforceable and perfected priming Lien upon that portion of the Lender Priority Collateral comprising the Catawba Acre, solely to the extent of the Catawba Acre Lien, and shall at all times be senior to the
rights of the Borrowers, any successor trustee to the extent permitted by law, or any other creditor in the Case, (z) shall have the priority and all the other benefits provided in the Initial CCAA Order and (aa) pursuant to
Sections 364(c)(2) and 364(c)(3) of the Bankruptcy Code, shall at all times be secured by (a) valid, enforceable and perfected second priority security interests in all assets securing the existing senior secured loan facilities of the
Credit Parties described in Schedule 4.01(m) (the "Existing Facilities"), excluding Avoidance Actions and (b) valid, enforceable and perfected first priority security interests in the Lender Priority Collateral,
excluding Avoidance Actions. 
 
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      (n) The Consolidated balance sheet of the Parent and its GAAP Subsidiaries as at December 31, 2007, and the related Consolidated statements of income and cash flows of the Parent and its GAAP
Subsidiaries for the Fiscal Year then ended, and the interim Consolidated balance sheets of the Parent and its GAAP Subsidiaries as at September 30, 2008 and the related Consolidated statements of income and cash flows of the Parent and its
GAAP Subsidiaries for the respective months then ended, which have been furnished to the Lenders present fairly the financial condition and results of operations of the Parent and its GAAP Subsidiaries as of such dates and for such periods all in
accordance with GAAP (subject to year-end adjustments and in the case of unaudited financial statements, except for the absence of footnote disclosure). 
      (o) There is no indebtedness or other outstanding obligations of the Credit Parties due to the secured party of record indicated in Schedule III in connection with the Catawba Acre Lien. 
 ARTICLE V 
 COVENANTS OF THE CREDIT PARTIES 
           SECTION 5.01. Affirmative Covenants. So long as any Advance shall remain unpaid or any Lender shall have any Commitment hereunder, each Credit Party will: 
      (a) Corporate Existence. Preserve and maintain in full force and effect all governmental rights, privileges, qualifications, permits, licenses
and franchises necessary or desirable in the normal conduct of its business except (i)(A) if in the reasonable business judgment of the Borrowers or such Guarantor, as the case may be, it is in its best economic interest not to preserve and maintain
such rights, privileges, qualifications, permits, licenses and franchises and the loss thereof is not materially disadvantageous to the Credit Parties, taken as a whole, and (B) such failure to preserve the same could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect, and (ii) as otherwise permitted by Section 5.02(h). 
      (b) Compliance
with Laws. Comply with all laws, rules, regulations, orders and other requirements of any governmental authority applicable to it or its property, such compliance to include without limitation, ERISA, Environmental Laws and The Racketeer
Influenced and Corrupt Organizations Chapter of The Organized Crime Control Act of 1970, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. 
      (c) Insurance. Keep its insurable properties insured at all times, against such risks, including fire and other risks insured against by
extended coverage, as is customary with companies of the same or similar size in the same or similar businesses (subject to deductibles and including provisions for self-insurance); and maintain in full force and effect public liability insurance
against claims for personal injury or death or property damage occurring upon, in, about or in connection with the use of any properties owned, occupied or controlled by the Borrowers or any Guarantor, as the case may be, in such amounts and with
such deductibles as are customary with companies of the same or similar size in the same or similar businesses and in the same geographic area and in each case with financially sound and reputable insurance companies (subject to provisions for
self-insurance). 
 
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      (d) Taxes. Pay and discharge and cause each of its Subsidiaries to pay and discharge promptly all taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or
in respect of its property arising, or attributed to the period, after the Bankruptcy Petition Date, before the same shall become in default, as well as all lawful claims for labor, materials and supplies or otherwise arising after the Bankruptcy
Petition Date which, if unpaid, would become a Lien or charge upon such properties or any part thereof; provided, however, that the Borrower and each Guarantor shall not be required to pay and discharge or to cause to be paid and
discharged any such tax, assessment, charge, levy or claim so long as the (i) payment or discharge thereof shall be stayed by the U.S. Bankruptcy Code or pursuant to the CCAA, or (ii) the validity or amount thereof shall be contested in good
faith by appropriate proceedings, in each case, if the Borrower and the Guarantors shall have set aside on their books adequate reserves therefor in conformity with GAAP. 
      (e) Access to Books and Records. 
      (i) Maintain or cause to be maintained at all times true
and complete books and records in accordance with GAAP of the financial operations of the Borrowers and the Guarantors; and provide the Lenders and their representatives access to all such books and records during regular business hours upon
reasonable advance notice, in order that the Lenders may examine and make abstracts from such books, accounts, records and other papers for the purpose of verifying the accuracy of the various reports delivered by the Borrowers or the Guarantors to
the Administrative Agent or the Lenders pursuant to this Agreement or for otherwise ascertaining compliance with this Agreement and to discuss the affairs, finances and condition of the Borrowers and the Guarantors with the officers and independent
accountants of the Borrowers; provided that the Borrowers shall have the right to be present at any such visit or inspection. 
      (ii) Grant
the Lenders access to and the right to inspect all reports, audits and other internal information of the Borrowers and the Guarantors relating to environmental matters upon reasonable advance notice, but subject to appropriate limitations so as to
preserve attorney-client privilege. 
      (iii) At any reasonable time and from time to time during regular business hours, upon reasonable
notice, permit the Lenders and/or any representatives designated by the Lenders (including any consultants, accountants, lawyers and appraisers retained by the Lenders) to visit the properties of the Borrowers and the Guarantors to conduct
evaluations, appraisals, environmental assessments and ongoing maintenance and monitoring in connection with the Collateral and all related systems; provided that representatives of the Borrowers shall have the right to be present at any such
visit and, unless an Event of Default has occurred and is continuing, such visits permitted under this clause (iii) shall be made no more frequently than once in any three-month period. 
      (f) Use of Proceeds. Use the proceeds of the Advances solely for the purposes, and subject to the restrictions, set forth in Section 2.11.

      (g) Priority. Acknowledge, (i) in the case of the U.S. Cases, pursuant to Section 364(c)(1) of the U.S. Bankruptcy Code,
that the Obligations of the Credit Parties hereunder and under the other Loan Documents constitute allowed Superpriority Claims in the U.S. Cases, pari passu to the Superpriority Claim granted to the holders of the Debt under the
Existing Facilities in accordance with the DIP Financing Orders, and (ii) in the case of the Canadian Case, the Obligations of the Credit Parties which are subject to the Initial CCAA Order 
 
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 under the
Loan Documents are secured by a Lien ranking as contemplated in the Initial CCAA Order. 
      (h) Validity of Loan Documents. Object to
any application made on behalf of any Credit Party or by any Person challenging the validity of any Loan Document or the applicability or enforceability of any Loan Document or which seeks to void, avoid, limit, or otherwise adversely affect the
security interest created by or in any Loan Document or any payment made pursuant thereto. 
      (i) Cash Management Order. Comply with
the Cash Management Order. 
      (j) Additional Guarantors. Cause each Subsidiary that hereafter becomes party to a Case to execute a
Guaranty Supplement within 10 days of becoming party thereto; provided, however, that notwithstanding the foregoing, no Subsidiary will be required to become or remain a Guarantor or provide or maintain a lien on any of its assets as
security for any of the Obligations (i) if such Subsidiary is not a wholly-owned Subsidiary or does not otherwise fall within the definition of "Guarantor"; or (ii) to the extent doing so would (x) result in any material adverse tax
consequences or (y) be prohibited by any Applicable Law. 
      (k) Environmental Matters. Comply, and cause each of its Subsidiaries
and all lessees and other Persons operating or occupying its properties to comply, in all material respects, with all applicable Environmental Laws and Environmental Permits; obtain and renew, and cause each of its Subsidiaries to obtain and renew,
all Environmental Permits necessary for its operations and properties and conduct, and cause each of its Subsidiaries to conduct, any investigation, study, sampling and testing, and undertake any cleanup, removal, remedial or other action necessary
to remove and clean up all Hazardous Materials from any of its properties, in accordance with the requirements of all Environmental Laws, in each case to the extent the failure to so comply, obtain renew, remove or clean up would result in a
Material Adverse Effect; provided, however, that neither the Borrower nor any of its Subsidiaries shall be required to undertake any such cleanup, removal, remedial or other action to the extent that its obligation to do so is being
contested in good faith and by proper proceedings and appropriate reserves are being maintained with respect to such circumstances. 
      (l)
Further Assurances. 
      (i) Promptly upon reasonable request by the Administrative Agent, or any Lender through the Administrative
Agent, correct, and cause each of its Subsidiaries promptly to correct, any material defect or error that may be discovered in any Loan Document or in the execution, acknowledgment, filing or recordation thereof. 
      (ii) Promptly upon reasonable request by the Administrative Agent, or any Lender through the Administrative Agent, do, execute, acknowledge, deliver,
record, re-record, file, re-file, register and re-register any and all such further acts, deeds, conveyances, pledge agreements, mortgages, deeds of trust, trust deeds, assignments, financing statements and continuations thereof, termination
statements, notices of assignment, transfers, certificates, assurances and other instruments as the Administrative Agent, or any Lender through the Administrative Agent, may reasonably request from time to time in order to (A) carry out more
effectively the purposes of the Loan Documents, (B) to the fullest extent permitted by Applicable Law, subject any Credit Party's properties, assets, rights or interests to the Liens now or hereafter required to be covered by any of the
Collateral Documents, (C) perfect and maintain the validity, 
 
39
 

  

  
 
  
 effectiveness
and priority of any of the Collateral Documents and any of the Liens required to be created thereunder and (D) assure, convey, grant, assign, transfer, preserve, protect and confirm more effectively unto the Secured Parties the rights granted or now
or hereafter intended to be granted to the Secured Parties under any Loan Document or under any other instrument executed in connection with any Loan Document to which any Credit Party or any of its Subsidiaries is or is to be a party, and cause
each of its Subsidiaries to do so. 
      (iii) Each of the Credit Parties hereby authorizes the Collateral Agent to file UCC financing
statements and PPSA registration statements naming such Credit Party as debtor and describing the collateral covered thereby as "all assets", "all personal property", or using a similarly broad collateral description, in such jurisdictions that the
Collateral Agent deems necessary or appropriate. 
      (m) Maintenance of Properties, Etc. Maintain and preserve all of its properties
that are used or useful in the conduct of its business in good working order and condition, ordinary wear and tear excepted, and will from time to time make or cause to be made all appropriate repairs, renewals and replacements thereof except where
failure to do so would not have a Material Adverse Effect; provided that, this subsection (m) shall not prohibit the sale, transfer or other disposition of any such property consummated in accordance with the other terms of this Agreement.

      (n) Post-Closing Obligations. 
      (i) Within 45 days following the Closing Date (or such later date as the Required Lenders may approve), the U.S. Bankruptcy Court shall have entered an order, in form and substance satisfactory to the
Administrative Agent and the Lenders, authorizing and approving, on a final basis, this Agreement, the other Loan Documents, the Commitment Letter and the Fee Letter and all of their respective provisions and the priorities and liens granted under
Sections 364(c) (and solely with respect to the Catawba Acre Lien, Section 364(d)) of the U.S. Bankruptcy Code, and containing such other terms and conditions as are acceptable to the Required Lenders in their sole discretion (the "Final
Order"), which order shall not have been vacated, reversed or stayed or, without the consent of the Required Lenders, modified or amended; provided, however, that any such modification or amendment that is adverse to an Initial
Lender shall be subject to the consent of such Initial Lender. 
      (ii) The Borrowers shall be in compliance with the DIP Financing Orders and
the Recognition Orders and each of the DIP Financing Orders and the Recognition Orders shall not have been reversed, modified, amended, stayed or vacated, in the case of any amendment or modification, without the prior written consent of the
Required Lenders; provided, however, that any such modification or amendment that is adverse to an Initial Lender shall be subject to the consent of such Initial Lender. 
      (iii) Within 45 days following the Closing Date (or such later date as the Required Lenders may approve), the Credit Parties shall have executed
and delivered any security agreements, pledge agreements and any other documents and agreements relating thereto reasonably requested by FFH, in each case, in form and substance reasonably acceptable to FFH. 
 
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      (iv) Within 10 days following the Closing Date (or such later date as the Required Lenders may approve), the Collateral Agent shall have received a certificate from the Borrowers' insurance broker or
other evidence satisfactory to it that all insurance required to be maintained by the Credit Parties hereunder is in full force and effect, together with endorsements naming the Collateral Agent as additional insured and loss payee thereunder.

      (v) Within 45 days following the Closing Date (or such later date as the Required Lenders may approve), the Borrowers shall have
appointed a Chief Restructuring Officer reasonably acceptable to the Required Lenders. 
      (vi) The Credit Parties shall provide written
notice to the Administrative Agent and FFH in reasonable detail within two Business Days of (A) any purchase offer that any Credit Party or a Subsidiary may receive with respect to any material asset (including with respect to the Abitibi
Entities), (B) any plan or proposal to sell or otherwise dispose of any material asset of the Credit Parties or their Material Subsidiaries (including with respect to the Abitibi Entities), and (C) any plan or proposal for the issuance of
Debt or Equity Interests by any Credit Party or any Subsidiary thereof (excluding the Abitibi Entities), and, in each case, at the request of FFH, additional details with respect to any such offer, plan or proposal, to the extent not prohibited by
confidentiality requirements. 
      (vii) Within 45 days following the Closing Date, obtain private debt ratings on the Obligations under
the DIP Facility from Moody's and Standard & Poor's. 
      (viii) Within 10 days following the Closing Date, the Administrative Agent
shall have received from each Secondary Guarantor duly executed counterparts of the closing documents described in Sections 3.01(a)(iii), (iv), (v) and (vi). 
      (ix) Within 10 Business Days following the Closing Date, the Administrative Agent shall have received a complete and accurate list of (A) all Material Real Property owned by any Credit Party or any of
its Subsidiaries, showing as of the date hereof the street address (if available), county or other relevant jurisdiction, state, record owner and book value thereof, (B) all leases of Material Real Property under which any Credit Party or any
of its Subsidiaries is the lessee, showing as of the date hereof the street address, (if available) county or other relevant jurisdiction, state, lessor, lessee, expiration date and annual rental cost thereof and (C) all leases of Material Real
Property under which any Credit Party is the lessor, showing as of the date hereof the street address, county or other relevant jurisdiction, state, lessor, lessee, expiration date and annual rental cost thereof. 
      (x) Within 45 days following the Closing Date, as such time period may be extended by the Administrative Agent and FFH in their sole discretion
(provided, that if substantially all of the items described in this Section 5.01(I) are not delivered by the date that is 90 days after the Closing Date, any additional extensions shall be subject to the approval of the Required
Lenders), the Borrower shall deliver deeds of trust, trust deeds, mortgages, leasehold mortgages and leasehold deeds of trust in form and substance reasonably satisfactory to the Administrative Agent and FFH (the "Mortgages") with
respect to the properties requested by FFH after the date hereof, duly executed by the appropriate Credit Party, together with: 
 
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      (A) evidence that counterparts of the Mortgages have been duly executed, acknowledged and delivered on or before the date that is 45 days after the Closing Date (or such later date as approved by the
Administrative Agent and FFH in their sole discretion) and are in form suitable for filing or recording in all filing or recording offices that the Administrative Agent may deem necessary or desirable in order to create a valid and subsisting Lien
on the property described therein in favor of the Collateral Agent for the benefit of the Secured Parties and that all filing and recording taxes and fees have been paid; 
      (B) fully paid American Land Title Association Lender's Extended Coverage (or, with respect to properties located in Canada, a Canadian equivalent thereof reasonably acceptable to the Administrative Agent and
FFH) title insurance policies (the "Mortgage Policies") in form and substance, with endorsements and in amount reasonably acceptable to the Administrative Agent and FFH, issued by Chicago Title or one or more other title insurers
reasonably acceptable to the Administrative Agent and FFH, insuring the Mortgages to be valid and subsisting Liens on the real property described therein, free and clear of all defects (including, but not limited to, mechanics' and materialmen's
Liens) and encumbrances, excepting only Permitted Liens, and providing for such other affirmative insurance (including endorsements for future advances under the Loan Documents and for mechanics' and materialmen's Liens) as the Administrative Agent
may reasonably deem necessary or desirable, and a zoning report from Planning and Zoning Resources Corporation (or, with respect to properties located in Canada, a Canadian equivalent thereof reasonably acceptable to the Administrative Agent and
FFH) satisfactory to Administrative Agent and FFH; 
      (C) American Land Title Association/American Congress on Surveying and Mapping form
surveys (or, with respect to properties located in Canada, a Canadian equivalent thereof reasonably acceptable to the Administrative Agent and FFH), for which necessary fees (where applicable) have been paid, dated no more than the date that is
45 days after the Closing Date or, solely in the case of the property located in Calhoun, Tennessee, 60 days after the Closing Date (or, in each case, such later date approved by the Administrative Agent and FFH in their sole discretion),
certified to the Administrative Agent, the Collateral Agent and the issuer of the Mortgage Policies in a manner satisfactory to the Administrative Agent and FFH by a land surveyor duly registered and licensed in the States in which the real property
described in such surveys is located and acceptable to the Administrative Agent and FFH, showing all buildings and other improvements, any off-site improvements, the location of any easements, parking spaces, rights of way, building set-back lines
and other dimensional regulations and the absence of encroachments, either by such improvements or on to such property, and other defects, other than encroachments and other defects acceptable to the Administrative Agent and FFH; 
      (D) evidence of the insurance required by the terms of the Mortgages; 
      (E) favorable opinions of local counsel for the Credit Parties (x) in states or provinces in which such properties are located, with respect to the enforceability and perfection of the Mortgages and any
related fixture filings in form and substance satisfactory to the Administrative Agent and FFH and (y) in 
 
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 states or
provinces in which the Credit Parties party to the Mortgages are organized or formed, with respect to the valid existence, corporate power and authority of such Credit Parties in the granting of the Mortgages, in form and substance satisfactory to
the Administrative Agent and FFH; and 
      (F) such other consents, agreements and confirmations of lessors and third parties as the
Administrative Agent and FFH may reasonably deem necessary or desirable and evidence that all other actions that the Administrative Agent and FFH may reasonably deem necessary or desirable in order to create valid and subsisting Liens on the
property described in the Mortgages has been taken. 
      (xi) Within 45 days following the Closing Date (or such later date as the
Required Lenders may approve), the Credit Parties and their respective Subsidiaries shall have executed and delivered the Intercompany Subordination Agreement to the Administrative Agent. 
      (xii) Within 5 Business Days following the Closing Date, as such time period may be extended by the Administrative Agent and FFH in their sole
discretion, each Credit Party located in the Province of Quebec or that has any real or personal property in the Province of Quebec shall deliver a duly executed hypothec agreement in favor of the Collateral Agent granting a hypothec in all of such
Credit Party's property, assets and undertaking in the Province of Quebec in form and substance satisfactory to the Collateral Agent and shall take all other actions reasonably required by the Collateral Agent in connection with the registration of
such hypothec agreement. 
      (o) Abitibi Entities. Promptly notify FFH with respect to any purchase offer or any proposal received by
the Parent or any Abitibi Entity to sell, transfer or otherwise dispose of all, substantially all or any significant portion of the assets of the Abitibi Entities (including, without limitation, any Equity Interests therein), and consult with FFH in
good faith prior to entering into any agreement with respect thereto. 
           SECTION 5.02. Negative Covenants. So long as any
Advance shall remain unpaid or any Lender shall have any Commitment hereunder, no Credit Party will, at any time: 
      (a) Liens. Incur,
create, assume or suffer to exist any Lien on any asset of the Borrowers or any of their respective Subsidiaries now owned or hereafter acquired by any of the Borrowers or the Guarantors, other than: 
      (i) Liens in favor of the Collateral Agent and the Secured Parties; 
      (ii) Liens in connection with Debt permitted to be incurred pursuant to Section 5.02(b)(vii) so long as such Liens extend solely to the property (and improvements and proceeds of such property) acquired with
the proceeds of such Debt or subject to the applicable Capitalized Lease; 
      (iii) Liens securing Debt in respect of any ABL Facility;
provided that Liens against Lender Priority Collateral securing any ABL Facility shall be subordinated to the Lien in favor of the Collateral Agent hereunder pursuant to intercreditor arrangements on terms reasonably acceptable to the Initial
Lenders; 
 
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      (iv) Liens securing the Carve-Out and other Liens contemplated under the DIP Financing Orders (including Liens securing the Existing Facilities); 
      (v) (A) purchase money Liens (including precautionary Lien filings made under the Code of any jurisdiction) on equipment acquired or held by any
Credit Party or any of its Subsidiaries in the ordinary course of its business to secure the purchase price of such equipment or Debt incurred solely for the purpose of financing the acquisition of such equipment or (B) Liens existing on such
equipment at the time of its acquisition; provided, however, that in the case of each of clauses (A) and (B), (x) no such Lien shall extend to or cover any other property of any Credit Party or any of its Subsidiaries, and
(y) the aggregate principal amount of Debt secured by any or all such Liens shall not exceed at any one time outstanding $10,000,000; 
      (vi) Liens arising from judgments, orders, or other awards not constituting an Event of Default; 
      (vii) Liens in existence on the Closing Date with respect to each Credit Party or any Subsidiary of a Credit Party, in each case described on Schedule 5.02(a)(vii); provided that the scope of any such
Lien shall not be increased, or otherwise expanded, to cover any additional property or type of asset, as applicable, beyond that in existence on the Closing Date; 
      (viii) Liens for taxes, assessments and other governmental charges or levies not yet due or as to which the period of grace (not to exceed thirty (30) days), if any, related thereto has not expired or
which are being contested in good faith and by appropriate proceedings promptly instituted and diligently conducted if adequate reserves are maintained to the extent required by GAAP; 
      (ix) the claims of materialmen, mechanics, carriers, warehousemen, repairmen, processors or landlords for labor, materials, supplies, rentals or other
similar Liens incurred in the ordinary course of business, unexercised rights of set off, in each case with respect to amounts not yet delinquent or that are bonded or being contested in good faith by appropriate legal proceedings promptly
instituted and diligently conducted and for which a reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made; 
      (x) Liens consisting of deposits or pledges made in the ordinary course of business in connection with, or to secure payment of, obligations under workers' compensation, unemployment insurance or similar
legislation; 
      (xi) bankers' Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on
deposit in one or more accounts maintained by any Credit Party or Subsidiary, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with
respect to cash management and operating account arrangements, including those involving pooled accounts and netting arrangements; provided that, unless such Liens are non-consensual and arise by operation of law, in no case shall any such
Liens secure (either directly or indirectly) the repayment of any Debt; 
      (xii) (A) Liens securing Debt permitted pursuant to
Section 5.02(b)(xvi); provided any such Lien shall encumber only the rights and interests under the insurance 
 
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 policy that
secures such Debt, and (B) Liens securing Debt permitted pursuant to Section 5.02(b)(xviii); provided any such Lien shall encumber only the assets being acquired or shipped pursuant to such letter of credit; 
      (xiii) purported Liens evidenced by the filing of precautionary UCC or PPSA financing statements relating solely to operating leases of personal
property entered into in the ordinary course of business; 
      (xiv) Liens in favor of customs and revenue authorities arising as a matter of
law to secure payment of customs duties in connection with the importation of goods; 
      (xv) Liens constituting encumbrances in the nature of
zoning restrictions, easements (including reciprocal easement agreements), rights-of-way, municipal building and zoning ordinances and similar charges, utility agreements, covenants, reservations, restrictions, encroachments, charges, encumbrances,
or other similar restrictions, title defects or other irregularities that were not incurred in connection with and do not secure Debt and do not materially and adversely affect the use of the property encumbered thereby for the intended purposes
and, which do not, in any case, impair (i) the use thereof in the ordinary conduct of business or (ii) the marketability or value of such property; 
      (xvi) Liens on the Collateral granted as adequate protection pursuant to an order of the Bankruptcy Courts; provided, however that all such Liens on the Lender Priority Collateral shall be fully
subordinated to the Liens of the Collateral Agent; 
      (xvii) Liens created by any pension legislation applicable to the Canadian Pension
Plans; and 
      (xviii) Liens that do not, individually or in the aggregate, secure obligations (or encumber property with a fair market value)
in excess of $5,000,000 at any one time outstanding. 
      (b) Debt. Contract, create, incur, assume or suffer to exist any Debt, or
permit any of its Subsidiaries to contract, create, incur, assume or suffer to exist any Debt, except for 
      (i) Debt (including Guaranteed
Obligations) under this Agreement and the other Loan Documents; 
      (ii) Debt incurred prior to the Bankruptcy Petition Date and listed on
Schedule 5.02(b) hereto (and in the case of the Debt set forth on such Schedule 5.02(b), the extension of maturity, refinancing or modification of the terms thereof; so long as (A) such extension, refinancing or modification is pursuant to
terms that, taken as a whole, are not less favorable to the Credit Parties and the Lenders than the terms of the Debt being extended, refinanced or modified or are otherwise reasonably satisfactory to the Required Lenders and (B) after giving
effect to such extension, refinancing or modification, the amount of such Debt is not greater than the amount of Debt outstanding immediately prior to such extension, refinancing or modification); 
      (iii) Debt arising from Investments among and between the Credit Parties that are permitted hereunder; 
 
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      (iv) Debt in respect of any overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing house transfers of funds; 
      (v) Debt in respect of netting services, customary overdraft protections and otherwise in connection with deposit accounts in the ordinary course of
business; 
      (vi) Debt in respect of any ABL Facility or the Existing Facilities; 
      (vii) Debt with respect to Capitalized Leases and purchase money Debt (including any such Debt incurred to finance the acquisition, construction or
improvement of any fixed or capital asset) in an aggregate amount not to exceed at any time $10,000,000; and any refinancings, renewals and extensions of any such purchase money Debt; 
      (viii) Debt secured by a Lien permitted under Section 5.02(a)(v); 
      (ix) Debt incurred in connection with a Hedge Agreement (A) which is entered into for interest rate, foreign currency or other business purposes and not for speculative purposes and (B) with a
counterparty reasonably satisfactory to the Administrative Agent; provided that any counterparty that is a Lender or any Affiliate thereof shall be deemed satisfactory to the Administrative Agent; 
      (x) Debt in respect of non-Credit Parties in existence on the Closing Date and set forth on Schedule 5.02(b); 
      (xi) Debt arising from judgments, orders or other awards to the extent not constituting an Event of Default; 
      (xii) other unsecured Debt in an aggregate principal amount outstanding not at any time exceeding $5,000,000; 
      (xiii) Debt owed by any Credit Party to any other Credit Party (provided that, if requested by the Administrative Agent, such Debt shall be
subordinated to the Obligations on terms and conditions reasonably satisfactory to the Administrative Agent); 
      (xiv) Debt owed by any
Subsidiary which is not a Credit Party to any other Subsidiary which is not a Credit Party; 
      (xv) Debt owed by any Subsidiary which is not
a Credit Party to a Credit Party (provided that such Debt shall be payable by such Subsidiary on demand by the Credit Party to the extent required pursuant to the Intercompany Subordination Agreement); provided that the aggregate
amount of such Debt, together with any equity or capital investments permitted pursuant to Section 5.01(h)(vii) (without duplication), shall not exceed $25,000,000 outstanding on any date of determination (which amount shall be calculated as
the net balance of such loans, advances and investments as reduced by any repayments or distributions made with respect thereto); 
      (xvi)
Debt in respect of insurance premium financing arrangements incurred in the ordinary course of business and provided that such Debt does not exceed the unpaid amount of such premiums; 
 
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      (xvii) Debt of non-U.S. Subsidiaries in an aggregate amount not to exceed at any time $15,000,000; and 
      (xviii) Debt of the Parent or any of its Subsidiaries (but excluding, for the avoidance of doubt, the Abitibi Entities) as an account party in respect of trade letters of credit entered into in the ordinary
course of business; provided that no such trade letter of credit shall be secured by any assets of the Parent or any of its Subsidiaries other than the assets being acquired or shipped pursuant to such letter of credit. 
      (c) Chapter 11 Claims. Subject to the DIP Financing Orders, incur, create, assume, suffer to exist or permit any claim that is pari
passu with or senior to the claims of the Secured Parties against the Borrowers and the Guarantors, other than in accordance with the applicable DIP Financing Orders. 
      (d) Dividends; Capital Stock. Declare or pay, directly or indirectly, any dividends or make any other distribution, or payment, whether in cash, property, securities or a combination thereof, with
respect to (whether by reduction of capital or otherwise) any shares of capital stock (or any options, warrants, rights or other equity securities or agreements relating to any capital stock) of the Borrowers, or set apart any sum for the aforesaid
purposes; provided that: 
      (i) the Borrowers or any of their Subsidiaries may make cash distributions or equity repurchases pursuant
to employee benefit plans or incentive compensation plans, in each case to the extent such distributions constitute compensation to executives or employees of such Borrower or of the applicable Subsidiary and in each case as approved by the
applicable Bankruptcy Court (whether or not such repurchase constitutes compensation); 
      (ii) any Subsidiary of the Parent may make
distributions or pay dividends to the Parent or any other Subsidiary of the Parent that owns any Equity Interests in such Subsidiary and, in the case of a distribution or dividend by a Subsidiary that is not a wholly-owned Subsidiary, to each other
owner of Equity Interests in such Subsidiary based on their relative ownership interests; and 
      (iii) AbitibiBowater Canada Inc. may
repurchase all or any portion of the Exchangeable Shares solely with either shares of common stock of the Parent, consideration received from the Abitibi Entities (including, but not limited to, any consideration received for the repurchase of the
shares of Abitibi held by AbitibiBowater Canada Inc.) or any combination thereof, in each case as approved in the CCAA Case for the Abitibi Entities. 
      (e) Equity Issuances. Except to the extent included as Debt and incurred in accordance with Section 5.02(b) hereof, issue, sell or otherwise dispose of any class or series of capital stock that,
by its terms or by the terms of any security into which it is convertible or exchangeable, is, or upon the happening of an event or passage of time would be (x) convertible or exchangeable into Debt unless such Debt is permitted at the time
pursuant to Section 5.02(b) or (y) required to be redeemed or repurchased, including at the option of the holder, in whole or in part, or has, or upon the happening of an event or passage of time would have, a redemption or similar payment
due; provided, however, that a Credit Party shall not be prohibited from issuing, selling or otherwise disposing of any such class or series of capital stock pursuant to any employee benefit plan or incentive compensation plan as in
effect on the Bankruptcy Petition Date up to a maximum value in excess of obligations to issue, sell or otherwise dispose of such 
 
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 capital stock
existing on the Bankruptcy Petition Date of (i) $10,000,000 in the aggregate, for all such plans, and (ii) $2,000,000 in the aggregate per annum for all such plans. 
      (f) Transactions with Affiliates. Enter into, renew, extend or be a party to, or permit any of its Subsidiaries to enter into, renew, extend or be a party to, any transaction or series of related
transactions (including, without limitation, the purchase, sale, lease, transfer or exchange of property or assets of any kind or the rendering of services of any kind) with any Affiliate, except (i) in the ordinary course of business in a
manner and to an extent consistent with past practice and necessary or desirable for the prudent operation of its business, for fair consideration and on terms no less favorable to it or its Subsidiaries than would be obtainable in a comparable
arm's length transaction with a Person that is not an Affiliate thereof, (ii) transactions with another Credit Party, (iii) compensation, retirement, expense reimbursement, insurance and indemnification arrangements with directors, officers,
employees or consultants in the ordinary course of business consistent with the DIP Budget; (iv) allocation of customer orders between the Abitibi Entities and the Bowater Entities determined in the ordinary course of business in a manner
consistent with past practice; (v) payments in the ordinary course of business to Abitibi Entities of amounts received by the Credit Parties and representing payments on accounts receivable of the Abitibi Entities consistent with the Cash Management
Order; (vi) allocation of selling, general and administrative expenses between Bowater Entities and Abitibi Entities in the ordinary course of business in a manner consistent with past practice; and (vii) joint purchasing agreements
between or among the Credit Parties and the Abitibi Entities whereby the parties thereto agree to jointly purchase goods or services from third parties; provided that such agreements are on terms no less favorable than would be obtainable in
a comparable arm's length transaction with a Person that is not an Affiliate. 
      (g) Investments. Make or hold, or permit any of its
Subsidiaries to make or hold, any Investment in any Person, except for: 
      (i) Investments existing on the Closing Date, as set forth on
Schedule 5.02(h) hereto, but not any increase in the amount thereof as set forth in such Schedule or any other material modification of the terms thereof; 
      (ii) Investments in cash and Cash Equivalents; 
      (iii) Investments by (A) any Credit Party in
any other Credit Party, (B) non-Credit Party in any other non-Credit Party and (C) any Credit Party or non-Credit Party in Bowater Canada and its Subsidiaries; provided that no such Investment may be made to any Abitibi Entity; 

     (iv) Investments (A) received in satisfaction or partial satisfaction thereof from financially troubled account debtors or in connection
with the settlement of delinquent accounts and disputes with customers and suppliers, or (B) received in settlement of debts created in the ordinary course of business and owing to the Borrower or any Subsidiary or in satisfaction of judgments;

      (v) Investments (A) in the form of deposits, prepayments and other credits to suppliers made in the ordinary course of business
consistent with current market practices, (B) in the form of extensions of trade credit in the ordinary course of business, (C) in the form of prepaid expenses and deposits to other Persons in the ordinary course of business and
(D) Investments constituting Hedge Agreements entered into for non-speculative purposes and permitted pursuant to Section 5.02(b); 
 
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      (vi) Investments made after the Closing Date in any Subsidiary formed after the Closing Date so long as (A) such Subsidiary is a Guarantor hereunder and (B) the Borrowers and their respective
Subsidiaries comply with the applicable provisions of 5.02(i); 
      (vii) Investments in the form of loans and advances to employees in the
ordinary course of business, which, in the aggregate, do not exceed at any time $5,000,000; 
      (viii) Investments in the form of intercompany
Debt to the extent permitted by Section 5.02(b)(xv); 
      (ix) Investments in the ordinary course of business consisting of UCC
Article 3 endorsements for collection or deposit and UCC Article 4 customary trade arrangements with customers; 
      (x) Investments
in the form of payment of expenses to the extent permitted under Section 5.02(f)(vi); and 
      (xi) other Investments in an aggregate
amount not to exceed $500,000. 
      (h) Fundamental Changes; Acquisitions; Asset Dispositions. Take any of the following actions, or
permit any of its Subsidiaries to do any of the foregoing: (x) wind-up, liquidate or dissolve, or merge, consolidate or amalgamate with any Person, (y) purchase or otherwise acquire, whether in one transaction or a series of related transactions,
all or substantially all of the assets of any Person (or any division thereof), or (z) make any Asset Disposition; other than, with respect to this sub-clause (z): 
      (i) the sale of inventory in the ordinary course of business; 
      (ii) the sale of obsolete, worn-out
or surplus assets in the ordinary course of business that are no longer used or usable in the business of the Parent or any of its Subsidiaries; 
      (iii) the transfer of assets to the Borrowers or any wholly-owned Subsidiary (provided that, in the case of any such transfer of assets, (A) if the transferee of such assets is a Credit Party, such
Credit Party shall not pay more than the fair market value of such assets (determined as of the date of the applicable transfer) and (B) if the transferor of such assets is a Credit Party, the transferee shall not pay less than the fair market
value of such assets (determined as of the date of the applicable transfer); 
      (iv) the Borrowers or any Subsidiary may write-off, discount,
sell or otherwise dispose of defaulted or past due receivables and similar obligations in the ordinary course of business and not as part of an accounts receivable financing transaction; 
      (v) the disposition of any Hedge Agreement; 
      (vi) the disposition of cash or Cash Equivalents; 
      (vii) the sale of timberlands by the Borrowers
or any of their Subsidiaries; and 
 
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      (viii) other asset dispositions in an aggregate amount not to exceed $3,000,000; 
 provided, however, that the
foregoing limitations are not intended to prevent any Credit Party from rejecting unexpired leases or executory contracts as permitted pursuant to section 365 of the Bankruptcy Code or the Initial CCAA Order in connection with the Cases. 
      (i) Nature of Business. Modify or alter, or permit any of its Subsidiaries to modify or alter, in any material manner the nature and type of
its business as conducted at or prior to the Bankruptcy Petition Date or the manner in which such business is currently conducted (except as required by the U.S. Bankruptcy Code), it being understood that sales permitted by Section 5.02(h) and
discontinuing operations expressly identified as operations to be discontinued in the DIP Budget shall not constitute such a material modification or alteration. 
      (j) Amendments of Constitutive Documents. Amend its constitutive documents, except for amendments that would not reasonably be expected to adversely affect the interests of the Lenders. 
      (k) Accounting Changes. Make or permit any changes in (i) accounting policies or reporting practices, except (x) as permitted or
required under GAAP and (y) solely in the case of reporting practices, in connection with any reporting to the Bankruptcy Courts as required under the Cases, or (ii) its Fiscal Year. 
      (l) Negative Pledge; Payment Restrictions Affecting Subsidiaries. Enter into or allow to exist, or allow any Subsidiary to enter into or allow
to exist, any agreement prohibiting or conditioning the ability of a Borrower or any such Subsidiary to (i) create any lien upon any of its property or assets, (ii) make dividends to, or pay any indebtedness owed to, any Credit Party,
(iii) make loans or advances to, or other investments in, any Credit Party, or (iv) transfer any of its assets to any Credit Party other than (A) any such agreement with or in favor of the Administrative Agent or the Lenders;
(B) any agreement setting forth customary restrictions on the subletting, assignment or transfer of any property or asset that is a lease, license, conveyance or contract of similar property or assets; (C) any restriction or encumbrance
imposed pursuant to an agreement that has been entered into by a Borrower or any Subsidiary for the disposition of any of its property or assets so long as such disposition is otherwise permitted under the Loan Documents; (D) any such agreement
imposed in connection with consignment agreements entered into in the ordinary course of business; (E) customary anti-assignment provisions contained in any agreement entered into in the ordinary course of business; (F) any agreement in
existence on the Bankruptcy Petition Date and any assumption of any such agreement permitted hereunder so long as the terms or provisions in connection with any such assumption relating to liens are no more restrictive than the agreement in effect
on the Bankruptcy Petition Date, (G) such encumbrances or restrictions required by applicable law, in each case as in effect on the Closing Date and (H) customary restrictions contained in the ABL Facility not affecting the rights of the
Secured Parties under the DIP Facility. 
      (m) Prepayments, Amendments, Etc. of Debt. (i) Prepay, redeem, purchase, defease or
otherwise satisfy prior to the scheduled maturity thereof in any manner, or make any payment in violation of any subordination terms of, any Debt except (A) regularly scheduled or required repayments or redemptions of Debt permitted hereunder,
(B) any prepayments or redemptions of Debt in connection with a refunding or refinancing of such Debt permitted by Section 5.02(b), (C) any repayments of Debt to the Borrowers or their Subsidiaries that was permitted to be incurred
under this Agreement, or (D) any repayment of Debt under the Existing Facilities from 
 
50
 

  

  
 
  
 proceeds of
assets securing such Existing Facilities, other than Lender Priority Collateral, to the extent allowed pursuant to an order of the Bankruptcy Courts, or (ii) amend, modify or change in any manner adverse to the Lenders any term or condition of
any Debt. 
      (n) Sales and Lease Backs. Except as set forth on Schedule 5.02(n), become or remain liable as lessee or as a
guarantor or other surety with respect to any lease of any property, whether now owned or hereafter acquired (i) which such Credit Party has sold or transferred or is to sell or transfer to any other Person (other than another Credit Party) or
(ii) which such Credit Party intends to use for substantially the same purpose as any other property which has been or is to be sold or transferred by a Credit Party to any Person (other than another Credit Party) in connection with such lease.

           SECTION 5.03. Reporting Requirements. So long as any Advance shall remain unpaid or any Lender shall have any
Commitment hereunder, each Credit Party will furnish to the Administrative Agent and FFH: 
      (a) Default Notice. As soon as possible
and in any event within two Business Days after any Responsible Officer of the Borrower has knowledge of the occurrence of any Default or within three Business Days after any Responsible Officer of any Credit Party has knowledge of the occurrence of
any event, development or occurrence reasonably likely to have a Material Adverse Effect continuing on the date of such statement, a statement of a Responsible Officer (or person performing similar functions) of such Credit Party setting forth
details of such Default or other event and the action that the Credit Parties have taken and propose to take with respect thereto. 
      (b)
Annual Financials. As soon as available and in any event within 105 days after the end of each Fiscal Year, in the case of the Bowater Entities and the Abitibi Entities, each on a combined basis and in the case of the Parent and its GAAP
Subsidiaries, on a consolidated basis, in each case, commencing with the Fiscal Year ending December 31, 2009, a copy of the annual audit report for such Fiscal Year, including therein a Consolidated balance sheet of the Bowater Entities, the
Abitibi Entities or the Parent and its GAAP Subsidiaries, as the case may be, as of the end of such Fiscal Year and Consolidated statements of income and cash flows of the Bowater Entities, the Abitibi Entities or the Parent and its GAAP
Subsidiaries, as the case may be, for such Fiscal Year, in each case accompanied by (A) in the case of the financial statements of the Parent and its GAAP Subsidiaries (including the Abitibi Entities), an opinion of independent public
accountants of recognized national standing reasonably acceptable to the Required Lenders and (B) a certificate of a Responsible Officer of the Parent stating that no Default has occurred and is continuing or, if a Default has occurred and is
continuing, a statement as to the nature thereof and the action that the Parent has taken and proposes to take with respect thereto. 
      (c)
Monthly Financials. In the case of the Bowater Entities and the Abitibi Entities, each on a combined basis and in the case of the Parent and its GAAP Subsidiaries, on a consolidated basis, in each case commencing with the month-ended
April 2009, and for each month thereafter, deliver to the Lenders (i) monthly financial statements of the Bowater Entities, the Abitibi Entities and the Parent and its GAAP Subsidiaries due on or before the 30th day after month-end, in the case of the first two months of each Fiscal Quarter, and the 50th day after month-end, in the case of
the third month of each Fiscal Quarter, and certified by a Responsible Officer of the Borrower, (ii) a report of monthly mill-level earnings before interest, taxes, depreciation and amortization and (iii) such other financial information
required to be delivered to the Bankruptcy Courts for such month, which information shall be in form and detail reasonably satisfactory to the Required Lenders, and, without duplication, a comparison of such 
 
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 financial
information with the projections for such month in the DIP Budget and a schedule in form reasonably satisfactory to the Lenders of the computations used in determining compliance with the covenant contained in Sections 5.04, 5.05, 5.06 and
5.07, all in reasonable detail and duly certified by a Responsible Officer of the Parent. In addition, no later than the last Business Day of each calendar month, and on any other date on which the Borrower may deliver the same to the Bankruptcy
Court, a supplement to the DIP Budget setting forth on a weekly basis for the next thirteen weeks (commencing with the immediately succeeding calendar week) an updated forecast of the information contained in the DIP Budget for such period and a
written set of supporting assumptions, all in form and substance reasonably satisfactory to the Required Lenders. 
      (d) Quarterly
Financials. In the case of the Bowater Entities and the Abitibi Entities, each on a combined basis, and in the case of the Parent and its GAAP Subsidiaries, on a consolidated basis, in each case commencing with the Fiscal Quarter ending
June 30, 2009, as soon as available and in any event within 50 days after the end of each of the first three quarters of each Fiscal Year, balance sheets of the Bowater Entities, the Abitibi Entities and the Parent and its GAAP
Subsidiaries as of the end of such quarter, and statements of income and cash flows of the Bowater Entities, the Abitibi Entities and the Parent and its GAAP Subsidiaries for the period commencing at the end of the previous quarter and ending with
the end of such quarter, and statements of income and cash flows of the Bowater Entities, Abitibi Entities and Parent and its GAAP Subsidiaries for the period commencing at the end of the previous Fiscal Year and ending with the end of such quarter,
setting forth, in each case in comparative form the corresponding figures for the corresponding period of the immediately preceding Fiscal Year, all in reasonable detail and duly certified (subject to normal year-end audit adjustments and subject to
any adjustments that might be required as a result of goodwill impairment testing) by a Responsible Officer of the Parent as having been prepared in accordance with GAAP, together with a certificate of said officer stating that no Default has
occurred and is continuing or, if a Default has occurred and is continuing, a statement as to the nature thereof and the action that the Borrower has taken and proposes to take with respect thereto. 
      (e) Bankruptcy Pleadings and Other Information. Promptly after the same is available, advance copies of all pleadings (to the extent
practicable), motions, applications, judicial information, financial information and other documents to be filed by or on behalf of any of the Credit Parties with the Bankruptcy Courts in the Cases, or distributed by or on behalf of any of the
Credit Parties to any Committee appointed in the Cases, providing copies of same to the Lenders and counsel for the Administrative Agent. 
      (f) Thirteen Week Forecast. No later than 5:00 pm EST on each Friday of each week following the Bankruptcy Petition Date, (i) a cash flow forecast detailing cash receipts and cash disbursements on
a weekly basis for the next 13 weeks (a "Thirteen Week Forecast"), the information and calculations contained in which shall be reasonably satisfactory to the Required Lenders and (ii) as promptly as possible following
delivery of a Thirteen Week Forecast and in no event later than five Business Days following such delivery, a reporting package, consistent with the reporting package provided to the Lenders as of the Closing Date, which includes, among other
things, a variance discussion and such other information as may be reasonably requested by the Administrative Agent and certified by a Responsible Officer. 
      (g) Budget Variance Report. No later than the last Business Day of each calendar week (commencing with the calendar week starting immediately after the Effective Date), a Budget Variance Report as of
the end of the immediately preceding calendar week. 
 
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      (h) ERISA Events and ERISA Reports. (i) Promptly and in any event within 10 Business Days after any Credit Party or any ERISA Affiliate knows or has reason to know that any ERISA Event has
occurred with respect to an ERISA Plan, a statement of a Responsible Officer of the Borrower describing such ERISA Event and the action, if any, that such Credit Party or such ERISA Affiliate has taken and proposes to take with respect thereto and
(ii) on the date any records, documents or other information must be furnished to the PBGC with respect to any ERISA Plan pursuant to Section 4010 of ERISA, a copy of such records, documents and information. 
      (i) Canadian Pension Plan Events. Promptly and in any event within 10 Business Days after any Credit Party knows or has reason to know that a
Canadian Pension Plan Event has occurred, evidence of such Canadian Pension Plan Event. 
      (j) Plan Terminations. Promptly and in any
event within five Business Days after receipt thereof by any Credit Party or any ERISA Affiliate, copies of each notice from the PBGC stating its intention to terminate any ERISA Plan or to have a trustee appointed to administer any ERISA Plan.

      (k) Actuarial Reports. Promptly upon receipt thereof by any Credit Party or any ERISA Affiliate, a copy of the annual actuarial
valuation report for each ERISA Plan, the funding target attainment percentage (as defined in Section 303(d)(2) of ERISA) of which is less than 90%. 
      (l) Multiemployer Plan Notices. Promptly and in any event within five Business Days after receipt thereof by any Credit Party or any ERISA Affiliate from the sponsor of a Multiemployer Plan, copies of
each notice concerning (i) the imposition on such Person of Withdrawal Liability by any such Multiemployer Plan, (ii) the reorganization or termination, within the meaning of Title IV of ERISA, of any such Multiemployer Plan or
(iii) the amount of liability incurred, or that may be incurred, by such Credit Party or any ERISA Affiliate in connection with any event described in clause (i) or (ii) above. 
      (m) Litigation. Promptly after the commencement thereof, notice of each unstayed action, suit, investigation, litigation and proceeding before
any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, affecting any Credit Party or any of its Subsidiaries that (i) is reasonably likely to be determined adversely and if so determined
adversely could be reasonably likely to have a Material Adverse Effect or (ii) purports to affect the legality, validity or enforceability of this Agreement any other Loan Document or the consummation of the transactions contemplated hereby.

      (n) Environmental Conditions. Promptly after the assertion or occurrence thereof, notice of any Environmental Action against or of
any non-compliance by any Credit Party or any of its Subsidiaries with any Environmental Law or Environmental Permit that could reasonably be expected to (i) result in a liability in excess of $2,000,000 or (ii) cause any real property to be
subject to any material restrictions on ownership, occupancy, use or transferability. 
      (o) Other Information.
(i) Simultaneously when provided to the holders of any Debt for borrowed money or investors in any asset securitization, sale or factoring facility of any Abitibi Entity, copies of reports, presentations and other financial documents relating
to the Abitibi Entities and other non-Credit Parties, and (ii) such other information respecting the business, condition (financial or otherwise), operations, performance, properties or prospects of 
 
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 any Credit
Party or any of its Subsidiaries as any Lender (through the Administrative Agent), the Administrative Agent or any of their advisors may from time to time reasonably request. 
      SECTION 5.04. Financial Covenants. So long as any Advance shall remain unpaid or any Lender shall have any Commitment hereunder, the Borrowers will not: 
      (a) Minimum Consolidated Fixed Charge Coverage Ratio. As of the last day of each Fiscal Quarter set forth below, permit the Consolidated Fixed
Charge Coverage Ratio for the four (4) Fiscal Quarter period ending on such day to be less than the minimum ratio set forth opposite such Fiscal Quarter: 
 
	 	 	 	 	 
	 	 	MINIMUM CONSOLIDATED
	 	 	FIXED CHARGE COVERAGE
	FISCAL QUARTER ENDING	 	RATIO
	 June 30, 2009
	 	 	4.00 to 1	 
	 September 30, 2009
	 	 	3.40 to 1	 
	 December 31, 2009
	 	 	3.10 to 1	 
	 March 31, 2010
	 	 	3.20 to 1	 
	 June 30, 2010
	 	 	3.30 to 1	 
	 September 30, 2010
	 	 	3.60 to 1	 

      (b) Capital Expenditures. Permit any Credit Party or any other Subsidiary to incur Capital
Expenditures in the aggregate during the 12-month period set forth below in excess of the maximum amount set forth below for such 12-month period: 
 
	 	 	 	 	 
	 	 	MAXIMUM CAPITAL
	12 MONTH PERIOD	 	EXPENDITURES
	 March 31, 2010
	 	$	75,000,000	 

      (c) Minimum Consolidated EBITDA. As of the last day of each month set forth below, permit
Consolidated EBITDA for the 12 month period then ended to be less than the following: 
 
	 	 	 	 	 
	 	 	MINIMUM CONSOLIDATED
	MONTH ENDING:	 	EBITDA
	 April 30, 2009
	 	$	248,000,000	 
	 May 31, 2009
	 	$	235,000,000	 
	 June 30, 2009
	 	$	224,000,000	 
	 July 31, 2009
	 	$	220,000,000	 
	 August 31, 2009
	 	$	205,000,000	 
	 September 30, 2009
	 	$	192,000,000	 
	 October 31, 2009
	 	$	189,000,000	 
	 November 30, 2009
	 	$	175,000,000	 
	 December 31, 2009
	 	$	176,000,000	 
	 January 31, 2010
	 	$	181,000,000	 
	 February 28, 2010
	 	$	196,000,000	 
	 March 31, 2010
	 	$	178,000,000	 
	 April 30, 2010
	 	$	172,000,000	 
	 May 31, 2010
	 	$	176,000,000	 
	 June 31, 2010
	 	$	187,000,000	 

 
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	 	 	MINIMUM CONSOLIDATED
	MONTH ENDING:	 	EBITDA
	 July 31, 2010
	 	$	186,000,000	 
	 August 31, 2010
	 	$	191,000,000	 
	 September 30, 2010
	 	$	203,000,000	 

 ARTICLE VI 
 GUARANTY 
           SECTION 6.01. Guaranty; Limitation of Liability. (a) (i) Each U.S. Guarantor, jointly and severally, hereby absolutely,
unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all Obligations of each other Credit Party, including,
without limitation, any extensions, modifications, substitutions, amendments or renewals of any or all of the foregoing Obligations (such Obligations being the "U.S. Guaranteed Obligations") and (ii) each Canadian Guarantor,
jointly and severally, hereby absolutely, unconditionally and irrevocably guarantees the punctual payment when due, whether at scheduled maturity or on any date of a required prepayment or by acceleration, demand or otherwise, of all Obligations of
Bowater Canada, including, without limitation, any extensions, modifications, substitutions, amendments or renewals of any or all of the Obligations thereof (the "Canadian Guaranteed Obligations" and, together with the U.S. Guaranteed
Obligations, being referred to herein the "Guaranteed Obligations"), in each case, whether direct or indirect, absolute or contingent, and whether for principal, interest, premiums, fees, indemnities, contract causes of action, costs,
expenses or otherwise, and agrees to pay any and all expenses (including, without limitation, fees and expenses of counsel) incurred by any Agent, the Initial Lenders or any other Lender in enforcing any rights under this Guaranty or any other Loan
Document. Without limiting the generality of the foregoing, each applicable Guarantor's liability shall extend to all amounts that constitute part of the Guaranteed Obligations and would be owed by any other Credit Party to any Lender as set forth
above under or in respect of the Loan Documents but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving such other Credit Party. Notwithstanding anything
contained herein to the contrary, no Canadian Guarantor shall have any liability whatsoever with regard to the Obligations or Guaranteed Obligations of any Credit Party other than Bowater Canada and the other Canadian Guarantors. 
           (b) Each Guarantor, and by its acceptance of this Guaranty, each Agent and each other Lender, hereby confirms that it is the
intention of all such Persons that this Guaranty and the Obligations of each Guarantor hereunder not constitute a fraudulent transfer, preference or conveyance or any other transaction capable of being challenged or voided for purposes of any Debtor
Relief Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to the extent applicable to this Guaranty and the Obligations of each Guarantor hereunder. To effectuate the
foregoing intention, any Agent, the other Lenders and the Guarantors hereby irrevocably agree that the Obligations of each Guarantor under this Guaranty at any time shall be limited to the maximum amount as will result in the Obligations of such
Guarantor under this Guaranty not constituting a fraudulent transfer, preference or conveyance or any other transaction capable of being challenged or voided. 
           (c) Each Guarantor hereby unconditionally and irrevocably agrees that in the event any payment shall be required to be made to any Lender under this Guaranty or any other
guaranty, such Guarantor will contribute, to the maximum extent permitted by law, such amounts to each other 
 
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 Guarantor and each other
guarantor so as to maximize the aggregate amount paid to the Lenders under or in respect of the Loan Documents. 
           SECTION 6.02.
Guaranty Absolute. Each Guarantor guarantees that the Guaranteed Obligations will be paid strictly in accordance with the terms of the Loan Documents, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of any Lender with respect thereto. The Obligations of each Guarantor under or in respect of this Guaranty are independent of the Guaranteed Obligations or any other Obligations of any other Credit Party
under or in respect of the Loan Documents, and a separate action or actions may be brought and prosecuted against each Guarantor to enforce this Guaranty, irrespective of whether any action is brought against the Borrower or any other Credit Party
or whether the Borrower or any other Credit Party is joined in any such action or actions. The liability of each Guarantor under this Guaranty shall be irrevocable, absolute and unconditional irrespective of, and each Guarantor hereby irrevocably
waives any defenses it may now have or hereafter acquire in any way relating to, any or all of the following: 
      (i) any lack of validity or
enforceability of any Loan Document or any agreement or instrument relating thereto; 
      (ii) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Guaranteed Obligations or any other Obligations of any other Credit Party under or in respect of the Loan Documents, or any other amendment or waiver of or any consent to departure from any Loan
Document, including, without limitation, any increase in the Guaranteed Obligations resulting from the extension of additional credit to any Credit Party or any of its Subsidiaries or otherwise; 
      (iii) any taking, exchange, release or non-perfection of any Collateral or any other collateral, or any taking, release or amendment or waiver of, or
consent to departure from, any other guaranty, for all or any of the Guaranteed Obligations; 
      (iv) any manner of application of Collateral
or any other collateral, or proceeds thereof, to all or any of the Guaranteed Obligations, or any manner of sale or other disposition of any Collateral or any other collateral for all or any of the Guaranteed Obligations or any other Obligations of
any Credit Party under the Loan Documents or any other assets of any Credit Party or any of its Subsidiaries; 
      (v) any change,
restructuring or termination of the corporate structure or existence of any Credit Party or any of its Subsidiaries; 
      (vi) any failure of
any Lender to disclose to any Credit Party any information relating to the business, condition (financial or otherwise), operations, performance, properties or prospects of any other Credit Party now or hereafter known to such Lender (each Guarantor
waiving any duty on the part of the Lenders to disclose such information); 
      (vii) the failure of any other Person to execute or deliver
this Agreement, any Guaranty Supplement or any other guaranty or agreement or the release or reduction of liability of any Guarantor or other guarantor or surety with respect to the Guaranteed Obligations; or 
      (viii) any other circumstance (including, without limitation, any statute of limitations) or any existence of or reliance on any representation by any
Lender that might otherwise constitute a defense available to, or a discharge of, any Credit Party or any other guarantor or surety. 
 
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 This Guaranty shall continue
to be effective or be reinstated, as the case may be, if at any time any payment of any of the Guaranteed Obligations is rescinded or must otherwise be returned by any Lender or any other Person upon the insolvency, bankruptcy or reorganization of
any Borrower or any other Credit Party or otherwise, all as though such payment had not been made. 
           SECTION 6.03. Waivers
and Acknowledgments. (a) Each Guarantor hereby unconditionally and irrevocably waives promptness, diligence, notice of acceptance, presentment, demand for performance, notice of nonperformance, default, acceleration, protest or dishonor and
any other notice with respect to any of the Guaranteed Obligations and this Guaranty and any requirement that any Lender protect, secure, perfect or insure any Lien or any property subject thereto or exhaust any right or take any action against any
Credit Party or any other Person or any Collateral. 
           (b) Each Guarantor hereby unconditionally and irrevocably waives any
right to revoke this Guaranty and acknowledges that this Guaranty is continuing in nature and applies to all Guaranteed Obligations, whether existing now or in the future. 
           (c) Each Guarantor hereby unconditionally and irrevocably waives (i) any defense arising by reason of any claim or defense based upon an election of remedies by any
Lender that in any manner impairs, reduces, releases or otherwise adversely affects the subrogation, reimbursement, exoneration, contribution or indemnification rights of such Guarantor or other rights of such Guarantor to proceed against any of the
other Credit Parties, any other guarantor or any other Person or any Collateral and (ii) any defense based on any right of set-off or counterclaim against or in respect of the Obligations of such Guarantor hereunder. 
           (d) Each Guarantor acknowledges that the Collateral Agent may, without notice to or demand upon such Guarantor and without affecting
the liability of such Guarantor under this Guaranty, foreclose under any mortgage by nonjudicial sale, and each Guarantor hereby waives any defense to the recovery by the Collateral Agent and the other Secured Parties against such Guarantor of any
deficiency after such nonjudicial sale and any defense or benefits that may be afforded by Applicable Law. 
           (e) Each
Guarantor hereby unconditionally and irrevocably waives any duty on the part of any Lender to disclose to such Guarantor any matter, fact or thing relating to the business, condition (financial or otherwise), operations, performance, properties or
prospects of any other Credit Party or any of its Subsidiaries now or hereafter known by such Lender. 
           (f) Each Guarantor
acknowledges that it will receive substantial direct and indirect benefits from the financing arrangements contemplated by the Loan Documents and that the waivers set forth in Section 6.02 and this Section 6.03 are knowingly made in
contemplation of such benefits. 
           SECTION 6.04. Subrogation. Each Guarantor hereby unconditionally and irrevocably
agrees not to exercise any rights that it may now have or hereafter acquire against any Borrower, any other Credit Party or any other insider guarantor that arise from the existence, payment, performance or enforcement of such Guarantor's
Obligations under or in respect of this Guaranty or any other Loan Document, including, without limitation, any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of
any Lender against any Borrower, any other Credit Party or any other insider guarantor or any Collateral, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including, without limitation, the right
to take or receive from a Borrower, any other Credit Party or any other insider guarantor, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right, unless
and until all of the Guaranteed Obligations and all other amounts payable under this Guaranty shall have been paid in full in cash and the Commitments shall have expired or been terminated. If any amount shall be paid to any Guarantor in violation
of the immediately preceding sentence at any time prior to the payment in full in cash of the Guaranteed 
 
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 Obligations and all other
amounts payable under this Guaranty, such amount shall be received and held in trust for the benefit of the Lenders, shall be segregated from other property and funds of such Guarantor and shall forthwith be paid or delivered to the Collateral Agent
in the same form as so received (with any necessary endorsement or assignment) to be credited and applied to the Guaranteed Obligations and all other amounts payable under this Guaranty, whether matured or unmatured, in accordance with the terms of
the Loan Documents, or to be held as Collateral for any Guaranteed Obligations or other amounts payable under this Guaranty thereafter arising. If (i) any Guarantor shall make payment to any Lender of all or any part of the Guaranteed
Obligations, (ii) all of the Guaranteed Obligations and all other amounts payable under this Guaranty shall have been paid in full in cash and (iii) the Maturity Date shall have occurred, the Lenders will, at such Guarantor's request and
expense, execute and deliver to such Guarantor appropriate documents, without recourse and without representation or warranty, necessary to evidence the transfer by subrogation to such Guarantor of an interest in the Guaranteed Obligations resulting
from such payment made by such Guarantor pursuant to this Guaranty. 
           SECTION 6.05. Guaranty Supplements. Upon the
execution and delivery by any Person of a guaranty supplement in substantially the form of Exhibit E hereto (each, a "Guaranty Supplement"), (a) such Person shall be referred to as an "Additional Guarantor" and
shall become and be a Guarantor hereunder, and each reference in this Guaranty to a "Guarantor" shall also mean and be a reference to such Additional Guarantor, and each reference in any other Loan Document to a "Guarantor" shall also mean and be a
reference to such Additional Guarantor, and (b) each reference herein to "this Guaranty," "hereunder," "hereof" or words of like import referring to this Guaranty, and each reference in any other Loan Document to the "Guaranty," "thereunder,"
"thereof" or words of like import referring to this Guaranty, shall mean and be a reference to this Guaranty as supplemented by such Guaranty Supplement. 
           SECTION 6.06. Subordination. Each Guarantor hereby subordinates any and all debts, liabilities and other Obligations owed to such Guarantor by each other Credit Party (the
"Subordinated Obligations") to the Guaranteed Obligations to the extent and in the manner hereinafter set forth in this Section 6.06: 
      (i) Prohibited Payments, Etc. Except during the continuance of a Default, each Guarantor may receive regularly scheduled payments from any other Credit Party on account of the Subordinated Obligations.
After the occurrence and during the continuance of any Default, however, unless the Required Lenders otherwise agree, no Guarantor shall demand, accept or take any action to collect any payment on account of the Subordinated Obligations. 
      (ii) Prior Payment of Guaranteed Obligations. In any proceeding under any Bankruptcy Law relating to any other Credit Party, each Guarantor
agrees that the Lenders shall be entitled to receive payment in full in cash of all Guaranteed Obligations (including all interest and expenses accruing after the commencement of a proceeding under any Debtor Relief Law, whether or not constituting
an allowed claim in such proceeding ("Post-Petition Interest") before such Guarantor receives payment of any Subordinated Obligations. 
      (iii) Turn-Over. After the occurrence and during the continuance of any Default, each Guarantor shall, if the Agent so requests, collect, enforce and receive payments on account of the Subordinated
Obligations as trustee for the Lenders and deliver such payments to the Agent on account of the Guaranteed Obligations (including all Post-Petition Interest), together with any necessary endorsements or other instruments of transfer, but without
reducing or affecting in any manner the liability of such Guarantor under the other provisions of this Guaranty. 
      (iv) Agent
Authorization. After the occurrence and during the continuance of any Default, the Administrative Agent is authorized and empowered (but without any obligation to so 
 
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 do), in its
discretion, (A) in the name of each Guarantor, to collect and enforce, and to submit claims in respect of, the Subordinated Obligations and to apply any amounts received thereon to the Guaranteed Obligations (including any and all Post-Petition
Interest), and (B) to require each Guarantor (x) to collect and enforce, and to submit claims in respect of, the Subordinated Obligations and (y) to pay any amounts received on such obligations to the Collateral Agent for application
to the Guaranteed Obligations (including any and all Post-Petition Interest). 
           SECTION 6.07. Continuing Guaranty;
Assignments. This Guaranty is a continuing guaranty and shall (a) remain in full force and effect until the latest of (i) the payment in full in cash of the Guaranteed Obligations and all other amounts payable under this Guaranty and
(ii) the Maturity Date (b) be binding upon each Guarantor, its successors and assigns and (c) inure to the benefit of and be enforceable by the Lenders and their successors, transferees and assigns. Without limiting the generality of
clause (c) of the immediately preceding sentence, any Lender may assign or otherwise transfer all or any portion of its rights and obligations under this Agreement (including, without limitation, all or any portion of its Commitments) to any
other Person, and such other Person shall thereupon become vested with all the benefits in respect thereof granted to such Lender herein or otherwise, in each case as and to the extent provided in Section 10.07. No Guarantor shall have the
right to assign its rights hereunder or any interest herein without the prior written consent of the Lenders. 
 ARTICLE VII 
 EVENTS OF DEFAULT 
           SECTION 7.01. Events of Default. If any of the following events
("Events of Default") shall occur and be continuing: 
      (a) the Borrowers shall fail to pay any principal of any Advance when
the same shall become due and payable or any Credit Party shall fail to make any payment of interest on any Advance or any other payment under any Loan Document within three business days after the same becomes due and payable; or 
      (b) any representation or warranty made by any Credit Party (or any of its officers) under or in connection with any Loan Document shall prove to have
been incorrect in any material respect when made or deemed made; or 
      (c) any Credit Party shall fail to perform or observe any term,
covenant or agreement contained in Sections 5.01(a), (e) or (n), 5.02, 5.03 or 5.04; or 
      (d) any Credit Party shall fail to
perform any other term, covenant or agreement contained in any Loan Document on its part to be performed or observed if such failure shall remain unremedied for 30 days; or 
      (e) (i) any Credit Party or any of its Subsidiaries shall fail to pay any principal of, premium or interest on or any other amount payable in respect of one or more items of Debt arising after the
Bankruptcy Petition Date of the Credit Parties and their Subsidiaries (excluding Debt outstanding hereunder) that is outstanding in an aggregate principal or notional amount (or, in the case of any Hedge Agreement, an Agreement Value) of at least
$10,000,000 when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), and such failure shall continue after the applicable grace period, if any, 
 
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 specified in
the agreements or instruments relating to all such Debt; or (ii) any other event shall occur or condition shall exist under the agreements or instruments relating to one or more items of Debt arising after the Bankruptcy Petition Date of the
Credit Parties and their Subsidiaries (excluding Debt outstanding hereunder) that is outstanding in an aggregate principal or notional amount of at least $10,000,000, and such other event or condition shall continue after the applicable grace
period, if any, specified in all such agreements or instruments, if the effect of such event or condition is to accelerate, or to permit the acceleration of, the maturity of such Debt or otherwise to cause, or to permit the holder thereof to cause,
such Debt to mature; or (iii) one or more items of Debt arising after the Bankruptcy Petition Date of the Credit Parties and their Subsidiaries (excluding Debt outstanding hereunder) that is outstanding in an aggregate principal or notional
amount (or, in the case of any Hedge Agreement, an Agreement Value) of at least $10,000,000 shall be declared to be due and payable or required to be prepaid or redeemed (other than by a regularly scheduled or required prepayment or redemption),
purchased or defeased, or an offer to prepay, redeem, purchase or defease such Debt shall be required to be made, in each case prior to the stated maturity thereof; or 
      (f) one or more final, non-appealable judgments or orders for the payment of money in excess of $10,000,000 (exclusive of any judgment or order the amounts of which are fully covered by insurance less any
applicable deductible) which is not in dispute) in the aggregate at any time, as an administrative expense of the kind specified in Section 503(b) of the U.S. Bankruptcy Code shall be rendered against any Credit Party or any of its Subsidiaries and
enforcement proceedings shall have been commenced by any creditor upon such judgment or order; or 
      (g) one or more nonmonetary judgments or
orders shall be rendered against any Credit Party or any of its Subsidiaries that is reasonably likely to have a Material Adverse Effect, and there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or 
      (h) any provision of any Loan Document after delivery
thereof shall for any reason cease to be valid and binding on or enforceable against any Credit Party intended to be a party to it, or any such Credit Party shall so state in writing; or 
      (i) any Collateral Document after delivery thereof shall for any reason (other than pursuant to the terms thereof) cease to create a valid and
perfected lien on and security interest in the Collateral purported to be covered thereby; or 
      (j) any ERISA Event shall have occurred with
respect to an ERISA Plan if such ERISA Event, along with any other ERISA Event that has occurred and then exists, is reasonably likely to result in any additional liability of a Credit Party or an ERISA Affiliate with respect to an ERISA Plan that
exceeds $10,000,000; or 
      (k) any Credit Party or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that
it has incurred Withdrawal Liability to such Multiemployer Plan in an amount that, when aggregated with all other amounts required to be paid to Multiemployer Plans by the Credit Parties and the ERISA Affiliates as Withdrawal Liability (determined
as of the date of such notification), exceeds $10,000,000 or requires payments exceeding $1,000,000 per annum; or 
      (l) any Credit Party or
any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in reorganization or is being terminated, 
 
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 within the
meaning of Title IV of ERISA, and as a result of such reorganization or termination the aggregate annual contributions of the Credit Parties and the ERISA Affiliates to all Multiemployer Plans that are then in reorganization or being terminated have
been or will be increased over the amounts contributed to such Multiemployer Plans for the plan years of such Multiemployer Plans immediately preceding the plan year in which such reorganization or termination occurs by an amount exceeding
$10,000,000; or 
      (m) a contribution or premium required, other than the Special
Amortization Payments, to be paid to or in respect of any Canadian Pension Plan is not paid in a timely fashion in accordance with the terms thereof and all applicable law, or material taxes, penalties or fees are owing or exigible under any
Canadian Pension Plan beyond the date permitted for payment of same; a proceeding, action, suit or claim (other than routine claims for benefits) is commenced or instituted involving any Canadian Pension Plan or its assets; an event with respect to
any Canadian Pension Plan which would entitle any Person (without the consent of the applicable Credit Party) to wind-up or terminate any Canadian Pension Plan, in whole or in part, or which could reasonably be expected to adversely affect the tax
status thereof, shall occur; a going concern unfunded actuarial liability, past service unfunded liability or solvency deficiency shall exist with respect to any single Canadian Pension Plan which exceeds $200,000,000; or an improper withdrawal or
transfer of assets from any Canadian Pension Plan shall occur; or 
      (n) Any of the Cases shall be dismissed or converted to a case under
Chapter 7 of the U.S. Bankruptcy Code or to a bankruptcy under the BIA or the Borrowers or any Guarantor shall file a motion or other pleading seeking the dismissal of any of the Cases under Section 1112 of the U.S. Bankruptcy Code or
under the CCAA or otherwise; a trustee under Chapter 7 or Chapter 11 of the U.S. Bankruptcy Code or the BIA, a responsible officer or an examiner with enlarged powers relating to the operation of the business (powers beyond those set forth
in Section 1106(a)(3) and (4) and Section 1106(b) of the U.S. Bankruptcy Code) or a receiver, receiver and manager or liquidator shall be appointed in any of the Cases or otherwise and the order appointing such trustee, responsible officer
or a receiver, receiver and manager or liquidator or examiner shall not be reversed or vacated within 30 days after the entry thereof; or, other than as set forth in the DIP Financing Orders, an application shall be filed by the
Borrowers or any Guarantor for the approval of any Superpriority Claim (other than the Carve-Out) in any of the Cases which is pari passu with or senior to the claims of the Administrative Agent, the Collateral Agent, and/or the Lenders against the
Borrowers or any Guarantor hereunder, or, other than as set forth in the DIP Financing Orders, there shall arise or be granted any such pari passu or senior Superpriority Claim or the Bankruptcy Courts shall enter an order terminating
the use of cash collateral; or 
      (o) The relevant Bankruptcy Court shall enter an order or orders granting relief from the automatic stay
applicable under Section 362 of the U.S. Bankruptcy Code or from the stay provided under the Initial CCAA Order to any creditor or creditors of the Borrowers or any of the Guarantors with respect to assets having an aggregate value in excess of
$3,000,000; or 
      (p) an order of the Bankruptcy Courts shall be entered reversing, staying for a period in excess of 10 days, vacating
or (without the written consent of the Administrative Agent) otherwise amending, supplementing or modifying any of the DIP Financing Orders in a manner that is adverse to the Lenders as determined by the Administrative Agent, or terminating the use
of cash collateral by the Borrowers or the Guarantors pursuant to the DIP Financing Orders or amending or modifying the adequate protections granted pursuant to the DIP Financing Orders; or 
 
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      (q) the Borrowers or Guarantors shall make any payment of Prepetition Debt other than pursuant to the DIP Financing Orders, in accordance with Section 5.02(m), or as otherwise agreed to by the
Administrative Agent and acceptable to the Lenders; 
      (r) a Change of Control shall occur; or 
      (s) the dissolution of any Borrower shall occur; or 
      (t) any of the Credit Parties shall cease to be authorized to use "cash collateral" of the administrative agents or lenders under the Existing Facilities as contemplated by the DIP Financing Orders; or 

     (u) the administrative agent or lenders under the Existing Facilities shall give notice of their intention to exercise remedies against any
Credit Party pursuant to the Existing Facilities, provided that the relevant stay in connection with the Cases has been lifted; or 
      (v) the Canadian DIP Recognition Order shall not be issued by the Canadian Bankruptcy Court by the third Business Day after the issuance of the Initial CCAA Order; or 
      (w) the Canadian Second DIP Recognition Order shall not be issued by the Canadian Bankruptcy Court by the third Business Day after the issuance of the
Final Order by the U.S. Bankruptcy Court; 
 then, and in any such event, subject only to the giving of an "Enforcement Notice" under and as defined in the DIP Financing
Orders to the parties entitled thereunder to receive such notice and subject to the limitations set forth in the DIP Financing Orders, without further order of or application to the Bankruptcy Courts, the Administrative Agent (i) shall at the
request, or may with the consent, of the Required Lenders, by notice to the Borrowers, declare the obligation of each Lender to make Advances to be terminated, whereupon the same shall forthwith terminate, and (ii) shall at the request, or may
with the consent, of the Required Lenders, by notice to the Borrower, declare the Notes, all interest thereon and all other amounts payable under this Agreement and the other Loan Documents to be forthwith due and payable all such interest and all
such amounts shall become and be forthwith due and payable, without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by the Borrowers. 
 ARTICLE VIII 
 THE AGENTS 
           SECTION 8.01. Authorization and Action. (a) Each Lender (on behalf of itself and its Affiliates in their capacities as a Lender hereby appoints FFH to act on its
behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof
and thereof, together with such actions and powers as are reasonably incidental thereto. 
           (b) Each Lender (on behalf of
itself and its Affiliates in their capacities as a Lender) hereby appoints FFH to act on its behalf as the Collateral Agent hereunder and under the other Loan Documents and authorizes the Collateral Agent to take such actions on its behalf and to
exercise such powers are delegated to the Collateral Agent by the terms hereof or thereof, together with such actions 
 
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 and powers as are reasonably
incidental thereto, including acting as the agent of such Lender for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Credit Parties to secure any of the Secured Obligations. 
           (c) The provisions of this Article are solely for the benefit of the Agents (including any successor Agent appointed pursuant to
Section 8.06) and the Lender, and neither the Borrower nor any other Credit Party shall have rights as a third party beneficiary of any of such provisions. 
           SECTION 8.02. Agents Individually. (a) Any Person serving as an Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender
and may exercise the same as though it were not an Agent and the term "Lender" or "Lenders" shall, unless otherwise expressly indicated or unless the context otherwise requires, include each Person serving as an Agent hereunder in its individual
capacity. Each such Person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other
Affiliate thereof as if such Person were not an Agent hereunder and without any duty to account therefor to the Lenders. 
           (b) Each Lender understands that each financial institution acting as an Agent and any successor Agent may and their respective Affiliates (collectively, the "Agent
Parties") are engaged in a wide range of financial services and businesses (including investment management, financing, securities trading, corporate and investment banking and research) (such services and businesses are collectively
referred to in this Section 8.02 as the "Activities") and may engage in the Activities with or on behalf of one or more of the Credit Parties or their respective Affiliates. Furthermore, the Agent Parties in undertaking the
Activities, engage in trading in financial products or undertake other investment businesses for their own account or on behalf of others (including the Credit Parties and their Affiliates and including holding, for its own account or on behalf of
others, equity and similar positions in the Borrowers, other Credit Parties or their respective Affiliates), including trading in or holding long, short or derivative positions in securities, loans or other financial products of one or more of the
Credit Parties or their Affiliates. Each Lender understands and agrees that in engaging in the Activities, the Agent Parties may receive or otherwise obtain information concerning the Credit Parties or their Affiliates (including information
concerning the ability of the Credit Parties to perform their respective Obligations hereunder and under the other Loan Documents), which information may not be available to any of the Lenders that are not Affiliates of the Agent Parties. Except for
documents expressly required by any Loan Document to be transmitted by the Administrative Agent to the Lenders, neither any Agent nor any other member of the Agent Parties shall have any duty or responsibility to provide, and shall not be liable for
the failure to provide, any Lender with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any Credit Party or any Affiliate of any Credit Party that may
come into the possession of any Agent or any Affiliate thereof or any employee or agent of any of the foregoing. 
           (c) Each Lender further understands that there may be situations in which parts of the Agent Parties' customers (including the Credit Parties or their Affiliates) either now
have or may in the future have interests or take actions that may conflict with the interests of any one or more of the Lenders (including the interests of the Lenders hereunder and under the other Loan Documents). Each Lender agrees that the Agent
Parties are not required to restrict their activities as a result of the Agent Parties acting as Agent (or in any other capacity) hereunder and under the other Loan Documents, and that the Agent Parties may undertake any Activities without further
consultation with or notification to any Lender. None of (i) this Agreement nor any other Loan Document, (ii) the receipt by the Agent Parties of Confidential Information nor (iii) any other matter shall give rise to any fiduciary,
equitable or contractual duties (including without limitation any duty of trust or confidence) owing by any Agent or any member of the Agent Parties to any Lender that would prevent or restrict the Agent Parties from 
 
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 acting on behalf of customers
(including the Credit Parties or their Affiliates) or for their own account. Each Lender agrees that none of any Agent, the Agent Parties nor any member or business of the Agent Parties is under a duty to disclose to any Lender or use on behalf of
the Lenders any information whatsoever about or derived from the Activities or to account for any revenue or profits obtained in connection with the Activities. 
           SECTION 8.03. Duties of Agents; Exculpatory Provisions. (a) The Agents' duties hereunder and under the other Loan Documents are solely mechanical and administrative
in nature and no Agent shall have any duties or obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, no Agent: 
      (i) shall be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing; and 
      (ii) shall have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that such Agent is required to exercise upon the written direction of the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the
other Loan Documents); provided that no Agent shall be required to take any action that, in its opinion or the opinion of its counsel, may expose such Agent or any of its Affiliates to liability or that is contrary to any Loan Document or
Applicable Law. 
           (b) No Agent shall be liable for any action taken or not taken by it (i) with the consent or at the
request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as such Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 7.01 or 10.01) or
(ii) in the absence of its own gross negligence or willful misconduct. No Agent shall be deemed to have knowledge of any Default or the event or events that give or may give rise to any Default unless and until notice describing such Default
and such event or events is given to such Agent by any Borrower or any Lender. 
           (c) No Agent shall be responsible for or
have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered
hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or the perfection or priority of any Lien or security interest created or purported to be created by the
Collateral Documents or (v) the satisfaction of any condition set forth in Article III or elsewhere herein, other than (but subject to the foregoing clause (ii)) to confirm receipt of items expressly required to be delivered to such Agent.
Neither any Agent nor any of its Related Parties shall be responsible for the adequacy, accuracy and/or completeness of any information (whether oral or written) supplied by any Agent, a Credit Party or any other Person given in, pursuant to or in
connection with any Loan Document. 
           (d) Nothing in this Agreement or any other Loan Document shall require any Agent to
carry out any "know your customer" or other checks in relation to any person on behalf of any Lender and each Lender confirms to each Agent that it is solely responsible for any such checks it is required to carry out and that it may not rely on any
statement in relation to such checks made by any Agent. 
           SECTION 8.04. Reliance by Agents. Each Agent shall be entitled
to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, 
 
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 document or other writing
(including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Each Agent also may rely upon any statement
made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of any Advances, that by its
terms must be fulfilled to the satisfaction of a Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender unless the Administrative Agent shall have received notice to the contrary from such Lender prior to the
making of such Advances. Each Agent may consult with legal counsel (who may be counsel for the Borrowers or any other Credit Parties), independent accountants and other experts selected by it, and shall not be liable for any action taken or not
taken by it in accordance with the advice of any such counsel, accountants or experts. 
           SECTION 8.05. Delegation of
Duties. Each Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by such Agent. Each Agent and any such sub-agent may
perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. Each such sub-agent and the Related Parties of each Agent and each such sub-agent shall be entitled to the benefits of all
provisions of this Article VIII and Article X (as though such sub-agents were the "Administrative Agent" or the "Collateral Agent," as the case may be, under the Loan Documents) as if set forth in full herein with respect thereto. 

          SECTION 8.06. Resignation and Replacement of Agents. 
           (a) Any Agent may at any time give notice of its resignation to the Lenders and the Borrowers, and may be removed at any time with or without cause by the Required Lenders.
Upon receipt of any such notice of resignation, the Required Lenders shall have the right, in consultation with the Borrower, to appoint a successor or upon any such removal by the Required Lenders. If no such successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Agent gives notice of its resignation (such 30-day period, the "Lender Appointment Period"), then the retiring Agent may on behalf
of the Lenders, appoint a successor Agent meeting the qualifications set forth above. In addition and without any obligation on the part of the retiring Agent to appoint, on behalf of the Lenders, a successor Agent, the retiring Agent may at any
time upon or after the end of the Lender Appointment Period notify the Borrower and the Lenders that no qualifying Person has accepted appointment as successor Agent and the effective date of such retiring Agent's resignation or removal. Upon the
resignation or removal effective date established in such notice and regardless of whether a successor Agent has been appointed and accepted such appointment, the retiring Agent's resignation or removal shall nonetheless become effective and
(i) the retiring Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that, in the case of any resignation or removal by or of the Collateral Agent, the retiring Collateral Agent shall
continue to hold any Collateral until such time as a successor Collateral Agent is appointed) and (ii) all payments, communications and determinations provided to be made by, to or through the retiring Agent shall instead be made by or to each
Lender directly, until such time as the Required Lenders appoint a successor Agent as provided for above in this paragraph. Upon the acceptance of a successor's appointment as Agent hereunder, such successor shall succeed to and become vested with
all of the rights, powers, privileges and duties of the retiring (or retired) Agent, and the retiring Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom
as provided above in this paragraph). The fees payable by the Borrowers to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrowers and such successor. After the retiring Agent's
resignation or removal hereunder and under the other Loan Documents, the provisions of this Article and Section 8.06 shall continue in effect for the benefit of such retiring Agent, its sub-agents and their respective Related 
 
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 Parties in respect of any
actions taken or omitted to be taken by any of them while the retiring Agent was acting as Agent. 
           (b) Each Credit Party
acknowledges that FFH intends to resign as Administrative Agent and/or Collateral Agent shortly after the Closing Date. Notwithstanding clause (a) above, (i) upon FFH's resignation as Administrative Agent and/or as Collateral Agent, its
successor shall be reasonably acceptable to the Parent (Parent's consent not to be unreasonably withheld or delayed), and (ii) all costs and expenses of the transition of such role(s) by FFH to its successor shall be for the account of the Credit
Parties pursuant to Section 10.04. The Credit Parties agree to work in good faith with FFH and the successor Agent to agree on any amendments to the Loan Documents reasonably requested by the successor Agent in connection with its appointment
hereunder, and acknowledge that customary agency fees will be payable by the Borrowers to the successor Agent. 
           SECTION 8.07.
Non-Reliance on Agents and Other Lenders. (a) Each Lender confirms to each Agent, each other Lender and each of their respective Related Parties that it (i) possesses such knowledge and experience in financial and business matters
that it is capable, without reliance on any Agent, any other Lender or any of their respective Related Parties, of evaluating the merits and risks (including tax, legal, regulatory, environmental, accounting and other financial matters) of entering
into this Agreement, making Advances and other extensions of credit hereunder and under the other Loan Documents and in taking or not taking actions hereunder and thereunder, (ii) is financially able to bear such risk and (iii) has
determined that entering into this Agreement and making Advances and other extensions of credit hereunder and under the other Loan Documents is suitable and appropriate for it. 
           (b) Each Lender acknowledges that it is solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with this
Agreement and the other Loan Documents and that it has, independently and without reliance upon any Agent or any other Lender or any of their respective Related Parties and based on such documents and information, as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon any Agent or any other Lender or any of their Related Parties and based on such documents and
information as it shall from time to time deem appropriate, continue to be solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with this Agreement and the other Loan Documents,
including but not limited to: 
           (i) the financial condition, status and capitalization of the Borrowers and
each other Credit Party; 
           (ii) the legality, validity, effectiveness, adequacy or enforceability of this
Agreement and each other Loan Document and any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with any Loan Document; 
           (iii) the adequacy, accuracy and/or completeness of any other information delivered by any Agent and any other Lender or
by any other Person under or in connection with this Agreement or any other Loan Document, the transactions contemplated by this Agreement and the other Loan Documents or any other agreement, arrangement or document entered into, made or executed in
anticipation of, under or in connection with any Loan Document. 
           SECTION 8.08. Indemnification. Each Lender severally
agrees to indemnify each Agent (to the extent not promptly reimbursed by the Parent) from and against such Lender's ratable share (determined as provided below) of any and all liabilities, obligations, losses, damages, penalties, actions, 
 
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 judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever that may be imposed on, incurred by, or asserted against such Agent in any way relating to or arising out of the Loan Documents or any action taken or omitted by such Agent under the Loan
Documents (collectively, the "Indemnified Costs"); provided, however, that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses
or disbursements resulting from such Agent's gross negligence or willful misconduct as found in a final, non-appealable judgment by a court of competent jurisdiction. Without limitation of the foregoing, each Lender agrees to reimburse each Agent
promptly upon demand for its ratable share of any costs and expenses (including, without limitation, fees and expenses of counsel) payable by the Parent under Section 10.04, to the extent that such Agent is not promptly reimbursed for such
costs and expenses by the Parent. In the case of any investigation, litigation or proceeding giving rise to any Indemnified Costs, this Section 8.08 applies whether any such investigation, litigation or proceeding is brought by any Lender or
any other Person. 
 ARTICLE IX 
 SECURITY 
           SECTION 9.01. Grant of Security. To induce the Lenders to make the Advances, each Credit Party hereby grants to the Collateral Agent, for itself and for the ratable
benefit of the Secured Parties, as security for the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of the Obligations of such Credit Party under the Loan Documents pursuant to the foregoing (whether
direct or indirect, absolute or contingent, and whether for principal, reimbursement obligations, interest, fees, premiums, penalties, indemnifications, contract causes of action, costs, expenses or otherwise) (collectively, the "Secured
Obligations"), a continuing Lien and security interest (subject only to certain Liens permitted pursuant to Section 5.02(a) and the Carve-Out) in accordance with subsections 364(c)(2) and (3) (and solely with respect to the Catawba Acre
Lien, Section 364(d)) of the U.S. Bankruptcy Code and having the priority set forth in the DIP Financing Orders, in and to all of the property and assets of such Credit Party and its estate, real and personal, tangible and intangible, whether
now owned or hereafter acquired or arising and regardless of where located (the "Collateral"), including but not limited to: 
      (a) all Equipment; 
      (b) all Inventory; 
      (c) all Accounts (and any and all such supporting obligations, security agreements, mortgages, Liens, leases, letters of credit and other contracts
being the "Related Contracts"); 
      (d) all General Intangibles; 
      (e) the following (the "Security Collateral"): 
      (i) all shares of stock and other Equity Interests from time to time owned or acquired by such Credit Party in any manner (such shares and other Equity Interests being the "Pledged Equity"), and
the certificates, if any, representing such additional shares or other Equity Interests, and all dividends, distributions, return of capital, cash, instruments and other property from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of such shares or other Equity 
 
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 Interests and
all subscription warrants, rights or options issued thereon or with respect thereto; 
      (ii) all indebtedness from time to time owed to such
Credit Party (such indebtedness being the "Pledged Debt") and the instruments, if any, evidencing such indebtedness, and all interest, cash, instruments and other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of such indebtedness; 
      (iii) all other investment property (including, without limitation, all
(A) securities, whether certificated or uncertificated, (B) security entitlements, (C) securities accounts, (D) commodity contracts and (E) commodity accounts) in which such Credit Party has now, or acquires from time to time
hereafter, any right, title or interest in any manner, and the certificates or instruments, if any, representing or evidencing such investment property, and all dividends, distributions, return of capital, interest, distributions, value, cash,
instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such investment property and all subscription warrants, rights or options issued thereon or with respect
thereto (the "Pledged Investment Property"); and 
      (iv) all securities, securities accounts, futures accounts, futures
contracts or financial assets (each as defined in the Securities Transfer Act (Ontario)); 
           (f) the following
(collectively, the "Account Collateral"): 
      (i) all deposit and other bank accounts and all funds and financial assets from
time to time credited thereto (including, without limitation, all Cash Equivalents), all interest, dividends, distributions, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such funds and financial assets, and all certificates and instruments, if any, from time to time representing or evidencing such accounts; 
      (ii) all promissory notes, certificates of deposit, deposit accounts, checks and other instruments; and 
      (iii) all interest, dividends, distributions, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the then
existing Account Collateral; 
      (g) the following (collectively, the "Intellectual Property"): 
      (i) all patents, patent applications, utility models and statutory invention registrations, all inventions claimed or disclosed therein and all
improvements thereto ("Patents"); 
      (ii) all trademarks, service marks, domain names, trade dress, distinguishing guises,
logos, designs, slogans, trade names, business names, corporate names and other source identifiers, whether registered or unregistered (provided that no security interest shall be granted in United States intent-to-use trademark applications
to the extent that, and solely during the period in which, the grant of a security interest therein would impair the validity or enforceability of such intent-to-use trademark applications under 
 
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 applicable
federal law), together, in each case, with the goodwill symbolized thereby and otherwise enuring thereto ("Trademarks"); 
      (iii) all copyrights, including, without limitation, copyrights in Computer Software, internet web sites and the content thereof, whether registered or unregistered ("Copyrights"); 
      (iv) all computer software, programs and databases (including, without limitation, source code, object code and all related applications and data
files), firmware and documentation and materials relating thereto, together with any and all maintenance rights, service rights, programming rights, hosting rights, test rights, improvement rights, renewal rights and indemnification rights and any
substitutions, replacements, improvements, error corrections, updates and new versions of any of the foregoing ("Computer Software"); 
      (v) all confidential and proprietary information, including, without limitation, know-how, trade secrets, manufacturing and production processes and techniques, inventions, research and development
information, databases and data, including, without limitation, technical data, financial, marketing and business data, pricing and cost information, business and marketing plans and customer and supplier lists and information (collectively,
"Trade Secrets"), and all other intellectual, industrial and intangible property of any type, including, without limitation, industrial designs, mask works and integrated circuit topography; 
      (vi) all registrations and applications for registration for any of the foregoing, together with all reissues, divisions, continuations,
continuations-in-part, extensions, renewals and reexaminations thereof; 
      (vii) all tangible embodiments of the foregoing, all rights in the
foregoing provided by international treaties or conventions, all rights corresponding thereto throughout the world and all other rights of any kind whatsoever of such Credit Party accruing thereunder or pertaining thereto; 
      (viii) all agreements, permits, consents, orders and franchises relating to the license, development, use or disclosure of any of the foregoing to
which such Credit Party, now or hereafter, is a party or a beneficiary; and 
      (ix) any and all claims for damages and injunctive relief for
past, present and future infringement, dilution, misappropriation, violation, misuse or breach with respect to any of the foregoing, with the right, but not the obligation, to sue for and collect, or otherwise recover, such damages; 
      (h) all of the right, title and interest of the Credit Parties in all real property the title to which is held by the Credit Parties, or the
possession of which is held by the Credit Parties pursuant to leasehold interest, and in all such leasehold interests, together in each case with all of the right, title and interest of the Credit Parties in and to all buildings, improvements, and
fixtures related thereto, any lease or sublease thereof, all general intangibles relating thereto and all proceeds thereof (collectively, the "Real Property Collateral"); 
 
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      (i) all books and records (including, without limitation, customer lists, credit files, printouts and other computer output materials and records) of such Credit Party pertaining to any of the Collateral; and

      (j) all proceeds of, collateral for, income, royalties and other payments now or hereafter due and payable with respect to, and supporting
obligations relating to, any and all of the Collateral (including, without limitation, proceeds, collateral and supporting obligations that constitute property of the types described in clauses (a) through (i) of this Section 9.01 and
this clause (j)) and, to the extent not otherwise included, all (A) payments under insurance (whether or not any Agent is the loss payee thereof), or any indemnity, warranty or guaranty, payable by reason of loss or damage to or otherwise with
respect to any of the foregoing Collateral, (B) tort claims, including, without limitation, all commercial tort claims and (C) cash; 
 provided, that notwithstanding
anything to the contrary contained in clauses (a) through (j) above, the security interest created by this Agreement shall not extend to, and the term "Collateral" shall not include, any Excluded Property. 
           SECTION 9.02. Rights of Lender; Limitations on Lenders' Obligations. Subject to each Credit Party's rights and duties under the
Bankruptcy Codes (including Section 365 of the U.S. Bankruptcy Code) and the Initial CCAA Order, and anything herein to the contrary notwithstanding, (i) each Credit Party shall remain liable under the contracts and agreements included in
such Credit Party's Collateral to the extent set forth therein to perform all of its duties and obligations thereunder to the same extent as if this Agreement had not been executed, (ii) the exercise by the Collateral Agent of any of the rights
hereunder shall not release any Credit Party from any of its duties or obligations under the contracts and agreements included in the Collateral and (iii) no Secured Party shall have any obligation or liability under the contracts and
agreements included in the Collateral by reason of this Agreement or any other Loan Document, nor shall any Secured Party be obligated to perform any of the obligations or duties of any Credit Party thereunder or to take any action to collect or
enforce any claim for payment assigned hereunder. 
           SECTION 9.03. The Collateral Agent's Duties. (a) The powers
conferred on the Collateral Agent hereunder are solely to protect the Secured Parties' interest in the Collateral and shall not impose any duty upon it to exercise any such powers. Except for the safe custody of any Collateral in its possession and
the accounting for moneys actually received by it hereunder, the Collateral Agent shall have no duty as to any Collateral, as to ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters
relative to any Collateral, whether or not any Secured Party has or is deemed to have knowledge of such matters, or as to the taking of any necessary steps to preserve rights against any parties or any other rights pertaining to any Collateral. The
Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of any Collateral in its possession if such Collateral is accorded treatment substantially equal to that which it accords its own property. 

          (b) Anything contained herein to the contrary notwithstanding, the Collateral Agent may from time to time, when the Collateral
Agent deems it to be necessary, appoint one or more subagents (each a "Subagent") for the Collateral Agent hereunder with respect to all or any part of the Collateral. In the event that the Collateral Agent so appoints any Subagent
with respect to any Collateral, (i) the assignment and pledge of such Collateral and the security interest granted in such Collateral by each Credit Party hereunder shall be deemed for purposes of this Agreement to have been made to such
Subagent, in addition to the Collateral Agent, for the ratable benefit of the Secured Parties, as security for the Secured Obligations of such Credit Party, (ii) such Subagent shall automatically be vested, in addition to the Collateral Agent,
with all rights, powers, privileges, interests and remedies of the Collateral Agent 
 
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 hereunder with respect to such
Collateral, and (iii) the term "Collateral Agent," when used herein in relation to any rights, powers, privileges, interests and remedies of the Collateral Agent with respect to such Collateral, shall include such Subagent; provided,
however, that no such Subagent shall be authorized to take any action with respect to any such Collateral unless and except to the extent expressly authorized in writing by the Collateral Agent. 
           SECTION 9.04. Remedies. If any Event of Default shall have occurred and be continuing, subject to the provisions of the DIP
Financing Orders, the Collateral Agent may exercise in respect of the Collateral, in addition to other rights and remedies provided for herein and in the Collateral Documents or otherwise available to it, all the rights and remedies of a secured
party upon default under the UCC (whether or not the UCC applies to the affected Collateral), the PPSA or other Applicable Law. 
           SECTION 9.05. Release; Termination. (a) Upon any sale, lease, transfer or other disposition of any item of Collateral of any Credit Party in accordance with the terms
of the Loan Documents and the DIP Financing Orders (other than sales of Inventory in the ordinary course of business), the Collateral Agent will, at such Credit Party's expense, execute and deliver to such Credit Party such documents as such Credit
Party shall reasonably request to evidence the release of such item of Collateral from the assignment and security interest granted hereby; provided, however, that (i) at the time of such request and such release no Default shall
have occurred and be continuing, (ii) such Credit Party shall have delivered to the Collateral Agent, at least 5 Business Days prior to the date of the proposed release, a written request for release describing the item of Collateral and the
terms of the sale, lease, transfer or other disposition in reasonable detail, including, without limitation, the price thereof and any expenses in connection therewith, together with a form of release for execution by the Collateral Agent and a
certificate of such Credit Party to the effect that the transaction is in compliance with the Loan Documents and as to such other matters as the Collateral Agent may request, and (iii) the proceeds of any such sale, lease, transfer or other
disposition required to be applied, or any payment to be made in connection therewith, in accordance with Section 2.04 shall, to the extent so required, be paid or made to, or in accordance with the instructions of, the Collateral Agent when
and as required under Section 2.04, and (iv) in the case of Collateral sold or disposed of, the release of a Lien created hereby will not be effective until the receipt by the Collateral Agent of any Net Cash Proceeds required to be paid
pursuant to Section 2.04 arising from the sale or disposition of such Collateral in accordance with clause (iii) above. 
           (b) Upon the payment in full in cash of the Secured Obligations (other than contingent indemnification obligations which are not then due and payable), the pledge and
security interest granted hereby shall terminate and all rights to the Collateral shall revert to the applicable Credit Party. Upon any such termination, the Administrative Agent will, at the applicable Credit Party's expense, execute and deliver to
such Credit Party such documents as such Credit Party shall reasonably request to evidence such termination. 
 ARTICLE X 
 MISCELLANEOUS 
           SECTION 10.01. Amendments, Etc. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent to any departure by the Borrowers or any other Credit Party therefrom, shall be effective unless in writing signed by the Required Lenders (or each of the Lenders, as applicable) and the
Borrower or the applicable Credit Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given;
provided, however, that no such amendment, waiver or consent shall: 
 
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      (i) waive any condition set forth in Section 3.01 without the written consent of each Lender, or waive or amend Section 2.15; 
      (ii) extend or increase the Commitment of any Lender without the written consent of such Lender; 
      (iii) postpone any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan
Document including without limitation, the Maturity Date (except as otherwise set forth in the definition thereof), without the written consent of each Lender directly affected thereby; 
      (iv) reduce the principal of, or the rate of interest specified herein on, any Advance, or any fees or other amounts payable hereunder or under any
other Loan Document without the written consent of each Lender directly affected thereby; 
      (v) change the definition of "Required Lenders"
or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or grant any consent hereunder, without the written consent of each Lender; and 
      (vi) amend, restate, supplement or otherwise modify any provision of this Agreement or the DIP Financing Orders in any manner that would impair the
interests of the Lenders in the Collateral without the consent of each Lender; 
 and provided further that no amendment, waiver or consent shall, unless in writing and
signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document. 
 Notwithstanding anything to the contrary in this Section 10.01, if at any time on or before the date on which the Final Order is entered, the Lenders and the Borrower shall have jointly identified an obvious error or any error or
omission of a technical or immaterial nature, in each case, in any provision of the Loan Documents, then the Lenders and the Borrowers shall be permitted to amend such provision and such amendment shall become effective without any further action or
consent of any other party to any Loan Document. 
           SECTION 10.02. Notices, Etc. (a) All notices and other
communications provided for hereunder shall be in writing (including telegraphic or telecopy communication) and mailed, telegraphed, telecopied or delivered, if to any Borrower or any Guarantor, at the Parent's address at AbitibiBowater Inc., 1155
Metcalfe Street, Suite 800, Montréal, Québec H3B 5H2, Canada, Attention: Chief Financial Officer; with a copy to: General Counsel; if to any Lender, at its Lending Office, respectively, specified opposite its name on Schedule I;
if to any other Lender, at its Lending Office specified in the Assignment and Acceptance pursuant to which it became a Lender; if to FFH, at its address at 95 Wellington Street West, Suite 800, Toronto, ON, M5J 2N7, Canada, Attention: Paul
Rivett, or as to a Borrower, any Guarantor, any Lender or any Agent, at such other address as shall be designated by such party in a written notice to the other parties. All such notices and communications shall, when mailed, telegraphed or
telecopied, be effective 3 Business Days after being deposited in the U.S. mails, first class postage prepaid, delivered to the telegraph company or confirmed as received when sent by telecopier, respectively, except that notices and communications
to the Administrative Agent pursuant to Article II or III shall not be effective until received by the Administrative Agent. Delivery by telecopier of an executed counterpart of any amendment or waiver of any provision of this Agreement or of
any 
 
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 Exhibit hereto to be executed
and delivered hereunder shall be effective as delivery of a manually executed counterpart thereof. 
           (b) The Borrowers
hereby agree that it will provide to the Lenders all information, documents and other materials that it is obligated to furnish to the Lenders pursuant to the Loan Documents, including, without limitation, all notices, requests, financial
statements, financial and other reports, certificates and other information materials, but excluding any such communication that (i) relates to the payment of any principal or other amount due under this Agreement prior to the scheduled date
therefor, (ii) provides notice of any Default or Event of Default under this Agreement or (iii) is required to be delivered to satisfy any condition precedent to the effectiveness of this Agreement (all such non-excluded communications
being referred to herein collectively as "Communications"), by transmitting the Communications in an electronic/soft medium in a format acceptable to the Lenders heretofore provided to the Borrowers. The Borrower hereby agree that any
information provided to the Administrative Agent shall also be provided to the Lenders. 
           (c) Each Lender agrees to notify
the Borrowers in writing (including by electronic communication) from time to time of such Lender's e-mail address to which the foregoing notice may be sent by electronic transmission and that the foregoing notice may be sent to such e-mail address.
Nothing herein shall prejudice the right of any Lender to give any notice or other communication pursuant to any Loan Document in any other manner specified in such Loan Document. 
           SECTION 10.03. No Waiver; Remedies. No failure on the part of any Lender or the Administrative Agent to exercise, and no delay in exercising, any right hereunder or under
any Note shall operate as a waiver thereof; nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive
of any remedies provided by law. 
           SECTION 10.04. Costs, Fees and Expenses. (a) The Parent agrees (i) to pay
or reimburse the Lenders for all reasonable costs and expenses incurred in connection with the development, preparation, negotiation and execution of this Agreement (which shall be deemed to include any predecessor transaction contemplated to be
entered into with the Lenders), and the other Loan Documents and any amendment, waiver, consent or other modification of the provisions hereof and thereof (whether or not the transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and thereby (including the monitoring of, and participation in, all aspects of the Cases), including all fees, expenses and disbursements of separate counsel for the
Administrative Agent and each Initial Lender on a full indemnity basis, a counsel in each applicable jurisdiction and such other advisors as set forth in the Commitment Letter or otherwise, and (ii) to pay or reimburse the Lenders (including,
without limitation, the Administrative Agent for all reasonable costs and expenses incurred in connection with (A) the ongoing maintenance and monitoring of Availability and (B) enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement, the Loan Documents or otherwise (including all such costs and expenses incurred during any "workout" or restructuring in respect of the Obligations and during any legal proceeding, including any proceeding
under any Bankruptcy Law), including all reasonable fees, expenses and disbursements of separate counsel on a full indemnity basis for the Administrative Agent and each Initial Lender. The foregoing fees, costs and expenses shall include all search,
filing, recording, title insurance, collateral review, monitoring, and appraisal charges and fees and taxes related thereto, and other reasonable out-of-pocket expenses incurred by the Administrative Agent and the Lenders and the cost of independent
public accountants and other outside experts retained jointly by the Administrative Agent and the Lenders. All amounts due under this Section 10.04(a) shall be payable within ten Business Days after demand therefor accompanied by an appropriate
invoice. The agreements in this Section shall survive the termination of the Commitments and repayment of all other Obligations. 
 
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           (b) Whether or not the transactions contemplated hereby are consummated, the Parent shall indemnify and hold harmless the Administrative Agent, the Collateral Agent, each
Lender and their respective Affiliates, directors, officers, employees, counsel, agents, advisors, attorneys-in-fact and representatives (collectively the "Indemnitees") from and against any and all claims, damages, losses, liabilities
and expenses (including, without limitation, fees and disbursements of counsel), joint or several that may be incurred by, or asserted or awarded against any Indemnitee, in each case arising out of or in connection with or relating to any
investigation, litigation or proceeding or the preparation of any defense with respect thereto arising out of or in connection with (i) the execution, delivery, enforcement, performance or administration of any Loan Document or any other
agreement, letter or instrument delivered in connection with the transactions contemplated thereby or the consummation of the transactions contemplated thereby, (ii) any Commitment or Advance or the use or proposed use of the proceeds
therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property currently or formerly owned or operated by the Borrower or any other Credit Party, or any liability related in any way to the Borrowers or
any other Credit Party in respect of Environmental Laws or any Environmental Action, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other
theory (including any investigation of, preparation for, or defense of any pending or threatened claim, investigation, litigation or proceeding) and regardless of whether any Indemnitee is a party thereto (all the foregoing, collectively, the
"Indemnified Liabilities"), in all cases, whether or not caused by or arising, in whole or in part, out of the negligence of the Indemnitee; provided that such indemnity shall not, as to any Indemnitee, be available to the
extent that such claim, damage, loss, liability or expense is determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted primarily from the gross negligence or willful misconduct of such Indemnitee. In the
case of an investigation, litigation or other proceeding to which the indemnity in this Section 10.04(b) applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by the Borrowers or any
of their Subsidiaries, any security holders or creditors of the foregoing an Indemnitee or any other Person, or an Indemnitee is otherwise a party thereto and whether or not the transactions contemplated hereby are consummated. No Indemnitee shall
have any liability (whether direct or indirect, in contract, tort or otherwise) to the Borrowers or any of their Subsidiaries for or in connection with the transactions contemplated hereby, except to the extent such liability is determined in a
final non-appealable judgment by a court of competent jurisdiction to have resulted from such Indemnitee's gross negligence or willful misconduct. In no event, however, shall any Indemnitee be liable on any theory of liability for any special,
indirect, consequential or punitive damages (including, without limitation, any loss of profits, business or anticipated savings). No Indemnitee shall be liable for any damages arising from the use by others of any information or other materials
obtained through IntraLinks or other similar information transmission systems in connection with this Agreement. All amounts due under this Section 10.04(b) shall be payable within two Business Days after demand therefor. The agreements in this
Section shall survive the resignation of the Administrative Agent or the Collateral Agent, the replacement of any Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all the other Obligations. 
           (c) If any payment of principal of any LIBOR Advance is made by a Borrower to or for the account of a Lender other than on the last
day of the Interest Period for such Advance, or if a Borrower fails to make any payment or prepayment of an Advance for which a notice of prepayment has been given or that is otherwise required to be made, such Borrower shall, upon demand by such
Lender (with a copy of such demand to the Administrative Agent), pay to the Administrative Agent for the account of such Lender any amounts required to compensate such Lender for any additional losses, costs or expenses that it may reasonably incur
as a result of such payment or such failure to pay or prepay, as the case may be, including, without limitation, any actual loss (excluding loss of anticipated profits), cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender to fund or maintain such Advance. 
 
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           SECTION 10.05. Right of Set-off. Subject to the DIP Financing Orders, upon (a) the occurrence and during the continuance of any Event of Default and (b) the
making of the request or the granting of the consent specified by Section 7.01 to authorize the Administrative Agent to declare the Advances due and payable pursuant to the provisions of Section 7.01, each Lender and each of its respective
Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and otherwise apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender or such Affiliate to or for the credit or the account of any Borrower against any and all of the Obligations of such Borrower now or hereafter existing under this Agreement, irrespective of whether such
Lender shall have made any demand under this Agreement and although such obligations may be unmatured. Each Lender agrees promptly to notify the relevant Borrower after any such set-off and application; provided, however, that the failure to give
such notice shall not affect the validity of such set-off and application. The rights of each Lender and its respective Affiliates under this Section are in addition to other rights and remedies (including, without limitation, other rights of
set-off) that such Lender and its respective Affiliates may have. 
           SECTION 10.06. Binding Effect. This Agreement shall
become effective when it shall have been executed by the Borrowers, the Guarantors, the Initial Lenders and the Administrative Agent shall have been notified by each Lender that such Lender has executed it and thereafter shall be binding upon and
inure to the benefit of the Borrowers, the Administrative Agent, the Initial Lenders and each other Lender and their respective successors and assigns, except that no Borrower shall have the right to assign its rights hereunder or any interest
herein without the prior written consent of each Lender. 
           SECTION 10.07. Successors and Assigns; Initial Lender Right of
First Refusal. (a) Each Lender may assign all or a portion of its rights and obligations under this Agreement; provided, however, that (i) each such assignment shall be of a uniform, and not a varying, percentage
of all rights and obligations under and in respect of the DIP Facility, (ii) except in the case of an assignment to a Person that, immediately prior to such assignment, was a Lender, an Affiliate of any Lender or an Approved Fund of any Lender, the
consent of the Borrowers shall be required (such consent not to be unreasonably withheld) unless an Event of Default shall have occurred and be continuing, (iii) each such assignment shall be to an Eligible Assignee, (iv) the parties to each
such assignment shall execute and deliver to the Administrative Agent, for its acceptance and recording in the Register, and (v) such Eligible Assignee shall execute each of the other Loan Documents as requested by the Required Lenders; and
provided, further, that any Initial Lender proposing to make any assignment of its rights and obligations hereunder to any Person other than an Affiliate or Approved Fund of such Initial Lender shall provide the other Initial Lender
with two Business Days' prior notice of the terms of such proposed assignment and, upon notice to the proposing Initial Lender from the other Initial Lender within such two Business Day period, such other Initial Lender shall have the right to
purchase such rights and obligations as assignee on the terms and conditions set forth in such notice. 
           (b) Upon such
execution, delivery, acceptance and recording, from and after the effective date specified in such Assignment and Acceptance, (i) the assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and obligations of a Lender hereunder and (ii) the Lender assignor thereunder shall, to the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights (other than its rights under Sections 2.13, 2.14 and 8.04 to the extent any claim thereunder relates to an event arising prior to such assignment) and be released from its
obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the remaining portion of an assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto). 
 
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           (c) By executing and delivering an Assignment and Acceptance, each Lender assignor thereunder and each assignee thereunder confirm to and agree with each other and the other
parties thereto and hereto as follows: (i) other than as provided in such Assignment and Acceptance, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with any Loan Document or the execution, legality, validity, enforceability, genuineness, sufficiency or value of, or the perfection or priority of any lien or security interest created or purported to be
created under or in connection with, any Loan Document or any other instrument or document furnished pursuant thereto; (ii) such assigning Lender makes no representation or warranty and assumes no responsibility with respect to the financial
condition of any Credit Party or the performance or observance by any Credit Party of any of its obligations under any Loan Document or any other instrument or document furnished pursuant thereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial and other statements referred to in Section 5.03 and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will, independently and without reliance upon the Administrative Agent, such assigning Lender or any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement; (v) such assignee confirms that it is an Eligible Assignee; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Loan Documents as are delegated to the Administrative Agent by the terms hereof and thereof, together with such powers and
discretion as are reasonably incidental thereto; and (vii) such assignee agrees that it will perform in accordance with their terms all of the obligations that by the terms of this Agreement are required to be performed by it as a Lender.

           (d) The Administrative Agent, acting for this purpose (but only for this purpose) as the Administrative Agent of the
Borrowers, shall maintain at its address referred to in Section 10.02 a copy of each Assignment and Acceptance delivered to and accepted by it and a register for the recordation of the names and addresses of the Lenders and the Commitment
hereunder of, and principal amount of the Advances owing hereunder to, each Lender from time to time (the "Register"). The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the
Borrowers, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrowers or the
Administrative Agent or any Lender at any reasonable time and from time to time upon reasonable prior notice. 
           (e) Upon
its receipt of an Assignment and Acceptance executed by an assigning Lender and an assignee, the Administrative Agent shall, if such Assignment and Acceptance has been completed and is in substantially the form of Exhibit A, as applicable,
(i) accept such Assignment and Acceptance, (ii) record the information contained therein in the Register and (iii) give prompt notice thereof and a copy of such Assignment and Acceptance to the Borrowers. 
           (f) Any Lender may, in connection with any assignment or proposed assignment pursuant to this Section 10.07, disclose to the
assignee or participant or proposed assignee or participant any information relating to the Borrowers furnished to such Lender by or on behalf of the Borrowers; provided, however, that, prior to any such disclosure, the
assignee or participant or proposed assignee or participant shall agree to preserve the confidentiality of any Confidential Information received by it from such Lender in accordance with Section 10.09 hereof. 
           SECTION 10.08. Execution in Counterparts. This Agreement may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one 
 
76
 

  

  
 
  
 and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by telecopier shall be effective as delivery of a manually executed counterpart of this Agreement. 
           SECTION 10.09. Confidentiality; Press Releases and Related Matters. (a) The Administrative Agent and the Lenders shall not disclose any Confidential Information to
any Person without the consent of the Borrower, other than (i) to the Administrative Agent' or such Lender's Affiliates and their officers, directors, employees, agents and advisors and to actual or prospective Eligible Assignees and
participants, and then only on a confidential, need-to-know basis, (ii) as requested or required by any law, rule or regulation or judicial process or (iii) as requested or required by any state, federal or foreign authority or examiner
regulating banks or banking. 
           (b) Each of the parties hereto and each party joining hereafter agrees that neither it nor
its Affiliates will at any time after (but not including) the Closing Date issue any press releases using the name of any Lender or its Affiliates or referring to this Agreement or any of the other Loan Documents without at least 2 Business Days'
prior notice to such Lender and without the prior written consent of such Lender or unless (and only to the extent that) such party or Affiliate is required to do so under law and then, in any event, such party or Affiliate will consult with the
Parent, the Administrative Agent, FFH and such Lender before issuing such press release. Each party consents to the publication by the Administrative Agent and FFH or any other Lender of a tombstone or similar advertising material relating to the
financing transactions contemplated by this Agreement. The Administrative Agent and FFH reserve the right to provide to industry trade organizations such necessary and customary information needed for inclusion in league table measurements. 

          SECTION 10.10. Patriot Act Notice. Each Lender and the Administrative Agent (for itself and not on behalf of any Lender)
hereby notifies the Credit Parties that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies each Credit Party, which information includes the name and address of such Credit Party
and other information that will allow such Lender or the Agent, as applicable, to identify such Credit Party in accordance with the Patriot Act. The Borrowers shall, and shall cause each of their Subsidiaries to, provide to the extent commercially
reasonable, such information and take such actions as are reasonably requested by the Administrative Agent or any Lender in order to assist the Administrative Agent and the Lenders in maintaining compliance with the Patriot Act. 
           SECTION 10.11. Jurisdiction, Etc. (a) Except in so far as the Bankruptcy Court has jurisdiction over the matter, each of the
parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate
court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any of the other Loan Documents to which it is a party, or for recognition or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in any such New York State court or, to the extent permitted by law, in such federal court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that any
party may otherwise have to bring any action or proceeding relating to this Agreement or any of the other Loan Documents in the courts of any jurisdiction. 
           (b) Except in so far as the Bankruptcy Court has jurisdiction over the matter, each of the parties hereto irrevocably and unconditionally waives, to the fullest extent it
may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any of the other Loan Documents to which it 
 
77
 

  

  
 
  
 is a party in any New York
State or federal court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. 
           SECTION 10.12. Governing Law. This Agreement and any Notes shall be governed by, and construed in accordance with, the laws of the
State of New York and, to the extent applicable, the Bankruptcy Codes. 
           SECTION 10.13. WAIVER OF JURY TRIAL. EACH OF
THE GUARANTORS, THE BORROWERS, THE ADMINISTRATIVE AGENT, THE INITIAL LENDERS AND THE LENDERS IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCES OR THE ACTIONS OF THE ADMINISTRATIVE AGENT, INITIAL LENDERS OR ANY LENDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF. 
 [The rest of this page is intentionally left blank] 
 
78
 

  

  
 
  
           IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

	 	 	 	 	 
	 	ABITIBIBOWATER INC., as a Borrower
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   Senior Vice President and Chief Financial Officer	 
	 
	 
	 	BOWATER INCORPORATED, as a Borrower
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   Senior Vice President and Treasurer	 
	 
	 
	 	BOWATER CANADIAN FOREST PRODUCTS INC.,
        as a Borrower
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   Vice President and Treasurer	 
	 

 

  

  
 
  
 
	 	 	 	 	 	 	 
	 
	 	BOWATER NEWSPRINT SOUTH LLC, as a Guarantor
	  
	 	 	 	 	 	 
	 
	 	By: 	 	/s/ William G. Harvey
	 
	 	 	 	 
	 
	 	 	 	Name: William G. Harvey
Title:   Manager
	  
	 	 	 	 	 	 
	 
	 	BOWATER NEWSPRINT SOUTH OPERATIONS LLC,
          as a Guarantor
	  
	 	 	 	 	 	 
	 
	 	By: 	 	Bowater Newsprint South LLC, its Sole Member and Manager
	  
	 	 	 	 	 	 
	 
	 	 	 	By: 	 	/s/ William G. Harvey
	 
	 	 	 	 	 	 
	 
	 	 	 	Name: 	 	William G. Harvey
	 
	 	 	 	Title: 	 	Manager
	  
	 	 	 	 	 	 
	 
	 	BOWATER FINANCE II LLC, as a Guarantor
	  
	 	 	 	 	 	 
	 
	 	By: 	 	/s/ William G. Harvey
	 
	 	 	 	 
	 
	 	 	 	Name: William G. Harvey
Title:   President

 

  

  
 
  
 
	 	 	 	 	 	 	 
	 
	 	BOWATER ALABAMA LLC, as a Guarantor
	  
	 	 	 	 	 	 
	 
	 	By: 	 	Bowater Newsprint South LLC, its Sole Member
	  
	 	 	 	 	 	 
	 
	 	 	 	By: 	 	/s/ William G. Harvey
	 
	 	 	 	 	 	 
	 
	 	 	 	Name: 	 	William G. Harvey
	 
	 	 	 	Title: 	 	Manager
	 

	 
	 	COOSA PINES GOLF CLUB HOLDINGS LLC,
          as a Guarantor
	  
	 	 	 	 	 	 
	 
	 	By: 	 	Bowater Alabama LLC, its Sole Member
	  
	 	 	 	 	 	 
	 
	 	 	 	By: 	 	Bowater Newsprint South LLC, its Sole Member
	  
	 	 	 	 	 	 
	 
	 	 	 	By: 	 	/s/ William G. Harvey
	 
	 	 	 	 	 	 
	 
	 	 	 	Name: 	 	William G. Harvey
	 
	 	 	 	Title: 	 	Manager
	  
	 	 	 	 	 	 
	 
	 	CATAWBA PROPERTY HOLDINGS, LLC, as a Guarantor
	  
	 	 	 	 	 	 
	 
	 	By: 	 	Bowater Incorporated, its Sole Member
	  
	 	 	 	 	 	 
	 
	 	By: 	 	/s/ William G. Harvey
	 
	 	 	 	 
	 
	 	 	 	Name: William G. Harvey
Title:   Senior Vice President and Treasurer

 

  

  
 
  

	 	 	 	 	 
	 	BOWATER FINANCE COMPANY INC., as a Guarantor
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   President	 
	 
	 
	 	BOWATER SOUTH AMERICAN HOLDINGS
        INCORPORATED, as a Guarantor
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   President	 
	 
	 
	 	BOWATER AMERICA INC., as a Guarantor
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   President and Treasurer	 
	 

 

  

  
 
  

	 	 	 	 	 
	 	LAKE SUPERIOR FOREST PRODUCTS INC., as a Guarantor
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   Vice President and Chief Financial Officer	 
	 
	 
	 	BOWATER NUWAY INC., as a Guarantor
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   Vice President	 
	 
	 
	 	BOWATER NUWAY MID-STATES INC., as a Guarantor
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   Vice President	 
	 

 

  

  
 
  

	 	 	 	 	 
	 	BOWATER VENTURES INC., as a Guarantor
 	 
	 	By:  	/s/ William G. Harvey 	 
	 	 	Name: William G. Harvey	 
	 	 	Title:   President	 

 

  

  
 
  

	 	 	 	 	 
	 	BOWATER CANADIAN HOLDINGS INCORPORATED,
        as a Guarantor
 	 
	 	By:  	/s/ Jacques P. Vachon 	 
	 	 	Name: Jacques P. Vachon	 
	 	 	Title:   Vice President and Secretary	 
	 
	 
	 	BOWATER LAHAVE CORPORATION, as a Guarantor
 	 
	 	By:  	/s/ Jacques P. Vachon 	 
	 	 	Name: Jacques P. Vachon	 
	 	 	Title:   Secretary	 
	 
	 
	 	ABITIBIBOWATER CANADA INC., as a Guarantor
 	 
	 	By:  	/s/ Jacques P. Vachon 	 
	 	 	Name: Jacques P. Vachon	 
	 	 	Title:   Vice President and Secretary	 
	 

 

  

  
 
  

	 	 	 	 	 
	 	FAIRFAX FINANCIAL HOLDINGS LTD.,
        as Administrative Agent
 	 
	 	By:  	/s/ Paul Rivett 	 
	 	 	Name: Paul Rivett	 
	 	 	Title:   Vice President and Chief Legal Officer	 
	 
	 
	 	FAIRFAX FINANCIAL HOLDINGS LTD.,
        as Collateral Agent
 	 
	 	By:  	/s/ Paul Rivett 	 
	 	 	Name: Paul Rivett	 
	 	 	Title:   Vice President and Chief Legal Officer	 
	 
	 
	 	FAIRFAX FINANCIAL HOLDINGS LTD.,
        as Initial Lender 
	 
	 

	 	By:  	/s/ Paul Rivett 	 
	 	 	Name: Paul Rivett	 
	 	 	Title:   Vice President and Chief Legal Officer	 
	 

 

  

  
 
  

	 	 	 	 	 
	 	AVENUE INVESTMENTS, L.P., as Initial Lender
 	 
	 

	 	By:  	Avenue Partners, LLC, its General Partner 	 
	 

	 	/s/ Marc Lasry 	 
	 	Name: Marc Lasry	 
	 	Title:   Managing Member	 

 

    
   

   
   
   
  SCHEDULE I
  
 PART A
 COMMITMENTS  
  

	   Name of Lender  
	
  Commitment  
	
  Commitment Percentage  

	
  Fairfax Financial Holdings Ltd.  
	
 US$128,750,000  
	
 62.5%  

	
  Avenue Investments, L.P.  
	
 US$77,250,000     
	
 37.5%  

	
  Total  
	
 US$206,000,000  
	
 100%  

  
 PART B

LENDING OFFICES  
  

	   Name  
	
   Address  

	
  Fairfax Financial Holdings Ltd.  
	
 85 Wellington Street West, Suite 800  
  Toronto, Ontario M5J 2N7  
  Canada  

	
  Avenue Investments, L.P.  
	
 535 Madison Avenue, 15th Floor
 New York, NY 100122
 USA  

     
     
     
     
 
     
     
     

   

     SCHEDULE II
  
 GUARANTORS
 
    
   I.         Primary Guarantors:  
  1.                   AbitibiBowater Inc. a
Delaware corporation  
  2.
                  Bowater Incorporated, a Delaware corporation  
  3.                   Bowater Alabama LLC, a
Alabama limited liability company  
  4.
                  Bowater Newsprint South Operations LLC, a Delaware limited liability company  
  5.                   Bowater Newsprint South
LLC, a Delaware limited liability company  
  6.
                  Bowater America Inc., a Delaware corporation  
  7.                   Bowater Nuway Inc., a
Delaware corporation  
  8.
                  Lake Superior Forest Products Inc., a Delaware corporation  
  9.                   Catawba Property
Holdings, LLC, a Georgia limited liability company  
  10.
              Bowater LaHave Corporation, a Nova Scotia company  
  11.               Bowater Canadian Holdings Incorporated, a Nova
Scotia company  
  12.
              AbitibiBowater Canada Inc., a Ontario company  
   II.        Secondary Guarantors:  
  13.
              Bowater Nuway Mid-States Inc., a Delaware corporation  
  14.               Bowater South American Holdings Incorporated,
a Delaware corporation  
  15.
              Bowater Ventures Inc., a Delaware corporation  
  16.               Coosa Pines Golf Club Holdings LLC, a Alabama
limited liability company  
  17.
              Bowater Finance II LLC, a Delaware limited liability company  
  18.               Bowater Finance Company Inc., a Delaware
corporation  
  19.
              Bowater Maritimes Inc., a New Brunswick company  
  20.               Bowater Canada Finance Corporation, a Nova
Scotia company  
  21.
              Bowater Canada Finance Limited Partnership, a New Brunswick limited partnership  
  
 
  
  22.               Bowater Canada Treasury Corporation, a Nova Scotia company  
  23.               Alliance Forest Products (2001) Inc., a Canada
corporation  
  24.
              Bowater Shelburne Corporation, a Nova Scotia company  
  25.               Bowater Canadian Limited, a Canada corporation
 
  26.               Bowater
Pulp and Paper Canada Holdings Limited Partnership, a New Brunswick limited partnership  
  27.
              Bowater Mitis Inc., a Quebec company  
  28.               Bowater Guerette Inc., a Quebec company
 
  29.               Bowater
Couturier Inc., a New Brunswick company  
  30.
              Bowater Treated Wood Inc., a Quebec company  
  31.               Canexel Hardboard Inc., a Canada corporation
 
  32.               9068-9050
Quebec Inc., a Quebec company  
  33.
              Bowater Belledune Sawmill Inc., a Canada corporation  
  34.               3231378 Nova Scotia Company, a Nova Scotia
company  
     

 
  
        SCHEDULE III  
     
  Catawba Acre  
     
  Catawba Acre
Lien:                  Any Lien evidenced by that certain Mortgage, Security Agreement, Financing Statement and Assignment of Rents and Leases dated November 15,
1996, made by
                                          
            Peridot Chemicals (Georgia), Inc., a Delaware corporation, as mortgagor, in favor of AT&T Commercial Finance Corporation, a Delaware corporation, as mortgagee,
                                          
            recorded in Mortgage Book 1697, Page 120, York County, South Carolina real property records.  
     
  Catawba
Acre:                         See Exhibit A attached to this Schedule III and incorporated herein by reference. 

     
     
     
 
     
     
  Exhibit A  
  to Schedule III  
      
      
  EXHIBIT A
 Legal Description
  
   
  All that
certain piece, parcel, or tract of land lying, being and situate on the southern side of old S.C. Highway 697, in Catawba Township, York County, South Carolina, and being more particularly shown and described on Plat of Property of Tennessee
Chemical Company, drawn by Hicks and Associates, Inc., on October 5, 1983, recorded in Plat Book 73 at Page 104, in the Office of the Clerk of Court for York County, South Carolina, and being more particularly described according to said plat as
follows: BEGINNING at an old railroad spike in the center of Highway 697 and running thence S. 27-57-43 E. 69.55 feet to a new Iron; thence running with line of property conveyed by Burris Chemical, Inc. to Bowaters Carolina Corporation, S. 21-28-10
W. 572.20 feet to a new iron; thence running S. 65-05-35 W. 436.59 feet to an old iron; thence running N. 89-54-29 W. 155.07 feet to an old iron; thence running N. 15-27-07 E. 254.61 feet to an old railroad spike in the center of old B.C. Highway
697; thence running with the center of old S.C. highway 697 to the point of beginning; the traverse line along old S.C. Highway 697 being as follows: N. 70-30-36 E. 199.93 feet to an old railroad spike, N. 58-45-35 E. 200.0 feet to an old railroad
spike, N. 46-00-33 E. 200.0 feet to an old railroad spike, N. 37-08-31 E. 200.0 feet to an old railroad spike and N. 29-32-12 E. 72.83 feet to an old railroad spike, the point of beginning.
  
 TOGETHER with easement for access to the above-described property granted by
Bowater Corporation pursuant to Grant of Easement for Drive or Road dated August 18, 1994, recorded August 30, 1994, in Record Book 1084, page 103, Office of the Clerk of Court for York County, South Carolina.
  
 DERIVATION: Deed from Tennessee Chemical Company, a Delaware corporation, to
Peridot Chemical Company, a Delaware corporation, dated December 15, 1988, recorded December 20, 1988, in Deed Book 1068, Page 161. Peridot Chemical Company having changed its name to Peridot Chemicals (Georgia), Inc., by Certificate of Amendment
recorded April 28, 1994, in Record book 991, Page 347, Office of the Clerk of Court for York County, South Carolina.
  
 
  

  
    
  
   SCHEDULE 1.01(a)  
  LIST OF OFFICERS
 
   

	  Name  
	
  Title  

	
  David J. Paterson  
	
 President and Chief Executive Officer  

	
  William G. Harvey  
	
 Senior Vice President and Chief Financial Officer  

	
  Alain Grandmont  
	
 Senior Vice President, Commercial Printing and Coated Papers  

	
  Yves Laflamme  
	
 Senior Vice President, Wood Products  

	
  Jon Melkerson  
	
 Senior Vice President, International and Business Development  

	
  Pierre Rougeau  
	
 Senior Vice President, Newsprint  

	
  W. Eric Streed  
	
 Senior Vice President, Supply Chain  

 
   

   
  
  
   Schedule 4.01(b) 
    

 Subsidiaries and Equity Interests 
  U.S. Subsidiaries: 
   

	  
Subsidiary 
	
  States of Organization 
	
  
Owner (Percentage) 

	 Bowater Newsprint South LLC 
	  DE 
	 AbitibiBowater Inc. (100%) 

	 Bowater Newsprint South Operations LLC 
	  DE 
	 Bowater Newsprint South LLC (100%) 

	 Bowater Alabama LLC 
	  AL 
	 Bowater Newsprint South LLC (100%) 

	 Coosa Pines Golf Club Holdings LLC 
	  AL 
	 Bowater Alabama LLC (100%) 

	 Bowater Finance II LLC 
	  DE 
	 Bowater Alabama LLC (50%); 
 Bowater Newsprint South Operations LLC (50%) 

	 Bowater Incorporated 
	  DE 
	 AbitibiBowater Inc. (100%) 

	 Catawba Property Holdings, LLC 
	  GA 
	 Bowater Incorporated (100%) 

	 Bowater Finance Company Inc. 
	  DE 
	 Bowater Incorporated (100%) 

	 Bowater South American Holdings Incorporated 
	  DE 
	 Bowater Incorporated (100%) 

	 Bowater America Inc. 
	  DE 
	 Bowater Incorporated (100%) 

	 Lake Superior Forest Products Inc. 
	  DE 
	 Bowater America Inc. (100%) 

	 Rich Timber Holdings, LLC 
	  DE 
	 Bowater Incorporated (100%) 

	 Bowater Nuway Inc. 
	  DE 
	 Bowater Incorporated (100%) 

	 Calhoun Newsprint Company 
	  DE 
	 Bowater Nuway Inc. (51%) 

	 Bowater Nuway Mid-States Inc. 
	  DE 
	 Bowater Nuway Inc. (100%) 

	 Bowater Ventures Inc. 
	  DE 
	 Bowater Incorporated (100%) 

   
   
   

   
   
   
  Non-U.S. Subsidiaries:  
   

	  
Subsidiary 
	
  Jurisdiction of Organization 
	
  
Owner (Percentage) 

	 Bowater Asia Pte Ltd. 	  Singapore 
	
 Bowater Incorporated (100%) 

	  Bowater Canada Finance Corporation 
	  Nova Scotia 
	
 Bowater Incorporated (100%) 

	  Bowater S. America Ltda. 
	  Brazil 
	
 Bowater South American Holdings Incorporated (0.1%);  
 Bowater Incorporated (99.9%) 

	  Bowater Canadian Holdings Incorporated 
	  Nova Scotia 
	
 Bowater Incorporated (100%) 

	  Bowater Canada Treasury Corporation 
	  Nova Scotia 
	
 Bowater Canadian Holdings Incorporated (100%) 

	  Bowater Canadian Limited 
	  Canada 
	
 Bowater Incorporated (100%) 

	  Bowater Pulp and Paper Canada Holdings Limited Partnership 
	  New Brunswick 
	
 Bowater Ventures Inc. (99%)  
 Bowater
Incorporated (1%) 

	  AbitibiBowater Canada Inc. 
	  Canada 
	
 Bowater Canadian Holdings Incorporated (100%) 

	  Bowater Canadian Forest Products Inc. 
	  Nova Scotia 
	
 AbitibiBowater Canada Inc. (100%) 

	  Bowater Canada Finance Limited Partnership 
	  New Brunswick 
	
 Bowater Canada Treasury Corporation (1%);  
 Bowater Canadian Forest Products Inc. (99%)  

	  Bowater Mersey Paper Company Limited 
	  Nova Scotia 
	
 Bowater Canadian Limited (51%) 

	  Bowater Shelburne Corporation 
	  Nova Scotia 
	
 Bowater Canada Finance Limited Partnership (100%) 

	  3231378 Nova Scotia Company 
	  Nova Scotia 
	
 Bowater Ventures Inc. (100%) 

	  South Shore Power Services Incorporated 
	  Nova Scotia 
	
 Bowater Mersey Paper Company Limited (100%) 

	  Brooklyn Power Corporation 
	  Canada 
	
 Bowater Mersey Paper Company Limited (100%) 

	  Bowater Europe Limited 
	  United Kingdom 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Alliance Forest Products (2001) Inc. 
	  Canada 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Bowater Belledune Sawmill Inc. 
	  Canada 
	
 Bowater Canadian Forest Products Inc. (100%) 

   

 
  

	  
Subsidiary 
	
  Jurisdiction of Organization 
	
  
Owner (Percentage) 

	  Bowater LaHave Corporation 
	  Nova Scotia 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Bowater Maritimes Inc. 
	  New Brunswick 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Bowater-Korea Ltd. 
	  Korea 
	
 Bowater LaHave Corporation (100%) 

	  Bowater Baie-Trinité Inc. 
	  Quebec 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Bowater Mitis Inc. 
	  Quebec 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Bowater Guérette Inc. 
	  Quebec 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Bowater Treated Wood Inc. 
	  Quebec 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Canexel Hardboard Inc. 
	  Canada 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  9068-9050 Québec Inc. 
	  Quebec 
	
 Bowater Canadian Forest Products Inc. (100%) 

	  Bowater Couturier Inc. 
	  New Brunswick 
	
 Bowater Guérette Inc. (100%) 

   
  
  

           
 
      

  
   Schedule 4.01(m) 
  
  Existing Facilities 
  
  Credit Agreement dated as of May 31, 2006 (as amended) by and among Bowater Incorporated, Bowater Newsprint South LLC, Bowater Alabama LLC and Bowater
Newsprint South Operations LLC, as borrowers, the lenders party thereto and Wachovia Bank, National Association, Administrative Agent 
    
  Credit Agreement dated as of May 31, 2006 (as amended) by and among Bowater Canadian Forest Products Inc., as borrower, the
guarantors party thereto, the lenders party thereto, and The Bank of Nova Scotia, as Administrative Agent 
      

   
    
   
  
  Schedule 5.02(a)(vii) 
  
  Existing Liens 
    
  U.S. Credit Parties : 
    
  ABITIBIBOWATER INC. 
   

  Delaware Secretary of State 
 Debtor:                        AbitibiBowater Inc. 
 Secured Party:            Caterpillar Financial Services Corporation 
 File No.:                       2008
2266037            7-2-2008 
 Collateral:                    Leased Caterpillar Skid Steer Loader 
   
 Debtor:                        AbitibiBowater Inc. 
 Secured Party:            J&L Fiber Services, Inc. 
 File No.:                       2009 0317070            1-30-2009

 Collateral:                    All inventory delivered to Debtor
under Supply Plan 
                                      Refiner Plate Supply
Agreement 
   
 Debtor:                       AbitibiBowater Inc. 
                                     Bowater Inc. 
                                     Abitibi Consolidated

                                     August Newsprint 

Secured Party:           J&L Fiber Services 
 File No.:                      2009
0654266            3-2-1009 
 Collateral:                   All inventory delivered to Debtor under Supply Plan 
                                      Refiner Plate Supply
Agreement 
   
 Debtor:                        AbitibiBowater Inc. 
 Secured Party:           Mayer Electric Supply Co., Inc. 
 File No.:                      2009 0411972            2-6-2009 
 Collateral:                    Mayer Electric Supply Co. inventory stored
on 
                                      Site per
agreement  
   
 Debtor:                        AbitibiBowater Inc. 
 Secured Party:            Andritz Inc. 
 File
No.:                       2009 0839842            3-17-2009 
 Collateral:                    All parts and other goods purchased by Debtor from
Secured Party                                      
            
                                       pursuant to
Debtor's Purchase Orders No. CPE3027, 270099,
                                         
               
                                       271527, 272714,
and 274237 and Secured Party's Sales Orders No.
                                    
                                       S93530, S91244,
82883, S93536, 82930 and S93656 and any all
                                         
                 
                                       proceeds from the
foregoing.
   

  
    
  BOWATER INCORPORATED 
    
 The lease and lease-back arrangement with the Industrial Development Board of the City of
Albertville relating to the Albertville sawmill  
    
 Any
Lien on the Catawba Acre disclosed on Schedule III 
    
  Delaware Secretary of State 
 Debtor:                         Bowater Incorporated 
 Secured Party:             OMNOVA Solutions, Inc. 
 File No.:                        1129808 7       9-27-2001 (cont'd 5-11-2006) 
 Collateral:                     Consigned inventory 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:            Applied Industrial Technologies-Dixie, Inc. 
 File No.:                       2274810 5      
10-31-2002 (cont'd 10-30-2007)  
 Collateral:                   
Consigned inventory 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:            Winthrop Resources Corporation 
 File No.:                       3093493 8      
4-2-2003 (cont'd 12-10-2007) 
 Collateral:                    Leased
equipment 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:            Applied Industrial Technologies-Dixie, Inc. 
 File No.:                       3131004 7      
5-22-2003 (cont'd 5-19-2008) 
 Collateral:                   
Purchase Money Security Interest in and to 
                                      all consigned equipment

   
 Debtor:                        Bowater Incorporated 
 Debtor:                        Applied Industrial Technologies-Dixie, Inc.

 File No.:                      3323038
3       12-9-2003 (cont'd 12-5-2008) 
 Collateral:                    Consigned equipment 
  
 
 Debtor:                         Bowater
Incorporated 
 Secured Party:             Barloworld Fleet Leasing LLC 
 File No.:                       4150112 3      
6-1-2004 
 Collateral:                    Leased equipment

   
 Debtor:                         Bowater Incorporated 
 Secured Party:             KIP America, Inc. 
 File No.:                       4172690 2       6-22-2004 
 Collateral:                    Leased equipment 
   
 Debtor:                         Bowater Incorporated 
  

  
 Secured
Party:             De Lage Landen Financial Services, Inc. 
 File
No.:                        4302860 4       10-27-2004 
 Collateral:                     Leased equipment 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Barloworld Fleet Leasing, Inc. 
 File No.:                        4312848 7      
11-5-2004 
 Collateral:                     Leased equipment

   
 Debtor:                         Bowater Incorporated 
 Secured Party:             NTFC Capital Corporation 
 File No.:                       4364293 3       12-27-2004 
 Collateral:                    Leased equipment 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Relational, LLC 
 Assignee:                     MB Financial Bank, N.A. 
 File No.:                        5085058 7       3-17-2005 
 Collateral:                     Leased equipment 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             FCC Equipment Financing, Inc. 
 File No.:                       5131653 9      
4-28-2005 
 Collateral:                    Taylor Industrial Lift
Truck 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             De Lage Landen Financial Services, Inc. 
 File No.:                       5136254 1      
5-3-2005 
 Collateral:                    Leased equipment

   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Caterpillar Financial Services Corporation 
 File No.:                       5152186 4      
5-17-2005 
 Collateral:                    Leased Caterpillar
equipment 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             FCC Equipment Financing, Inc. 
 File No.:                       5154911 3      
5-19-2005 
 Collateral:                    Taylor Industrial Lift
Truck and proceeds 
   
 Debtor:                        Bowater Incorporated 
 Secured Party:             General Electric Capital Corporation 
 File No.:                      5318075 0       10-24-2005
 
 Collateral:                    All equipment leased to or
financed for the Debtor 
                                     by the Secured Party under
the Total Image 
                                     Management Agreement

   

 Debtor:                         Bowater Incorporated 
 Secured Party:             Wachovia Bank, National Association, as Administrative Agent 
 File No.:                       6187108 6      
6-1-2006 
 Collateral:                    All accounts, cash and
currency, Chattel Paper, Deposit 
                                      Accounts, Documents,
General Intangibles, Instruments, 
                                      Inventory, Investment
Property, Letter of Credit Rights, books 
                                      Records and proceeds

   
 Debtor:                        Bowater Incorporated 
 Secured Party:            AstenJohnson, Inc. 
 File No.:                       6193124 5       6-7-2006 
 Collateral:                    Consigned goods and inventory 
   
 Debtor:                        Bowater Incorporated 
 Secured Party:           CSI Leasing, Inc. 
 File
No.:                      6341639 3       10-3-2006 
 Collateral:                   Leased computer equipment 
   
 Debtor:                        Bowater Incorporated 
 Secured Party:           General Electric Capital Corp. 
 File No.:                      6435636 6       12-13-2006 
 Collateral:                   Leased equipment 
   
 Debtor:                        Bowater Incorporated 
 Secured Party:            Caterpillar Financial Services Corporation 
 File No.:                      2007 0571025 2-13-2007 
 Collateral:                    Leased Caterpillar Excavator 
   
 Debtor;                        Bowater Incorporated 
 Secured Party:            Caterpillar Financial Services Corporation 
 File No.:                       2007 0571066 2-13-2007 
 Collateral:                    Leased Caterpillar Excavator 
   
 Debtor:                        Bowater Incorporated 
 Secured Party:            CSI Leasing, Inc. 
 File No.:                       2007 2820966 7-26-2007 
 Collateral:                    Leased computer equipment 
   
 Debtor:                        Bowater Incorporated 
 Secured Party:             Buckman Laboratories, Inc. 
 File No.:                       2007 2847084 7-27-2007 
 Collateral:                    Buckman-owned equipment located at 
                                      1000 Paper Mill Road,
Grenada MS  38901 
  
 Debtor:                        Bowater Incorporated 
   

  
 Secured
Party:             Buckman Laboratories, Inc. 
 File
No.:                       2007 2848769 7-27-2007 
 Collateral:                    Buckman-owned equipment located at
                                   
                                      1000 Paper Mill Road,
Grenada MS  38901 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Caterpillar Financial Services Corporation 
 File No.:                       2007 3697694 10-1-2007 
 Collateral:                    Leased Caterpillar Wheel Tractor 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Winthrop Resources Corporation 
 File No.:                       2007 4003793 10-1-2007 
 Collateral:                     Leased equipment 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Signode Packaging Systems 
 File No.:                       2007 4513098 11-29-2007 
 Collateral:                    Debtor's inventory of Signode packaging material 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Air Liquide Industrial U.S. LP 
 File No.:                       2009
0418050            2-9-2009 
 Collateral:                    Oxygen Vessels and Nitrogen vessels 
   
 Debtor:                         Bowater Incorporated 
 Secured Party:             Air Liquide Industrial U.S. LP 
 File No.:                       2009 0223641
           1-22-2009 
 Collateral:                    Oxygen Vessels and Nitrogen vessels 
   
 Debtor:                       
AbitibiBowater Inc. 
                                      Bowater Inc.

                                      Abitibi Consolidated

                                      August Newsprint

 Secured Party:           J&L Fiber Services 
 File No.:                      2009
0654266            3-2-1009 
 Collateral:                   All inventory delivered to Debtor under Supply Plan 
                                      Refiner Plate Supply
Agreement 
   
 Debtor:                        Bowater Incorporated 
  Secured Party:           Andritz Inc. 
 File
No.:                      2009 0840311 3-17-2009 
 Collateral:                   All parts and other good purchased by Debtor from Secured Party
                                       
            
                                      pursuant to Debtor's
Purchase Order No. 277890 and Secured
                                         
               
                                      Party's Sales Order No.
90650 and any and all proceeds
   
   

   
   
  BOWATER NEWSPRINT SOUTH LLC 
   
  Delaware Secretary of State 
 Debtor:                        Bowater Newsprint South LLC 
 Secured Party:            Wachovia Bank, National Association, as Administrative Agent 
 File No.:                       2008
1692266            5-15-2008 
 Collateral:                    All assets 
  

 Debtor:                        Bowater Newsprint
South LLC 
 Secured Party:            AstenJohnson, Inc. 
 File No.:                       2008
3681283            11-3-2008 
 Collateral:                    Consigned AstenJohnson, Inc. goods 
   
    
  BOWATER NEWSPRINT SOUTH OPERATIONS
LLC 
   
  Delaware Secretary of State 

Debtor:                        Bowater Newsprint South
Operations LLC 
 Secured Party:            Wachovia Bank, National Association, as Administrative Agent
 
 File No.:                      
2008    1692233          5-15-2008 
 Collateral:                    All assets 
  

 Debtor:                        Bowater Newsprint
South Operations LLC 
 Secured Party:            Komatsu Financial, L.P. 
 File No.:                       2009   
2482832          7-18-2008 
 Collateral:                    Komatsu Wheel Loader 
   
 Debtor:                       
Bowater Newsprint South Inc. 
 Secured Party:            Caterpillar Financial Services Corporation

 File No.:                      2009   
0211408          1-17-2007 
 Collateral:                    Caterpillar 966H Wheel Loader 
  

Debtor:                         Bowater Newsprint
South Inc. 
 Secured Party:             Caterpillar Financial Services Corporation 
 File No.:                       2007 
0427947           2-2-2007 
 Collateral:                    Caterpillar 345CMH Excavator 
   
 Debtor:                         Bowater Newsprint South Inc. 
 Secured Party:             Caterpillar Financial Services Corporation 
 File No.:                       2008
1603016            5-8-2008 
 Collateral:                    Caterpillar 365CL Excavator 
   
 Debtor:                         Bowater Mississippi Holdings Inc. 
  

  
 Secured
Party:            Wachovia Bank, National Association, as Administrative Agent 
 File
No.:                       6187101 1                 
6-1-2006 
 Collateral:                    All accounts, cash and
currency, Chattel Paper, Deposit 
                                      Accounts, Documents,
General Intangibles, Instruments, 
                                      Inventory, Investment
Property, Letter of Credit Rights, books 
                                      records and proceeds

   
  Grenada County, Mississippi 
 Debtor:                        Bowater Newsprint South
Operations LLC
Secured Party:            Wachovia Bank, National Association, as Administrative Agent 
 File No.:                       Book 2008 Page
5195                        5-15-2008 
 Collateral:                    Deed of Trust, Assignment of Leases and Rents, 
                             Security Agreement and Fixture
Filing
   
 Debtor:                        Bowater Newsprint South Operations LLC 
 Secured Party:             Wachovia Bank, National Association, as Administrative Agent 
 File No.:                       Book 2009 Page
600              1-20-2009 
 Collateral:                    First Amendment to Deed of Trust, Assignment 
                                      of Leases and Rents,
Security Agreement and 
                                      Fixture Filing

   
 Debtor:                        Bowater Newsprint South Operations LLC 
 Secured Party:            Wachovia Bank, National Association, as Administrative Agent 
 File No.:                       Book 2008 Page
5299                        5-16-2008 
 Collateral:                    All fixtures located on real property in Grenada County, 
                                     
Mississippi       
   
    
  BOWATER ALABAMA LLC 
    
 The lease and leaseback arrangement with the Industrial Development Board of the City of
Childersburg, Alabama.  
    
  Alabama Secretary of
State 
 Debtor:                         Bowater Alabama LLC 
 Secured Party:             Wachovia Bank, National Association, as Administrative Agent 
 File No.:                        08-0345111    5-16-2008

 Collateral:                    All assets 
   
 Debtor:                         Bowater Alabama Inc. 
 Secured Party:             Wachovia Bank, National Association, as Administrative Agent 
 File No.:                       06-0500954    6-1-2006 
 Collateral:                    All Accounts, cash and currency, Chattel Paper,
Deposit 
                                      Accounts, Documents,
General Intangibles, Instruments, 
                                      Inventory, Investment
Property, Letter of Credit Rights, books 
                                      Records and proceeds

    

 Debtor:                        Bowater Alabama LLC 
  Secured Party:           VFS Leasing Co. 
 File
No.:                      08-0531497    6-1-2008 
 Collateral:                   2008 Volvo Wheel Loader 
   
 Debtor:                       
Bowater Alabama Inc. 
 Secured Party:            FCC Equipment Financing, Inc. 
 File No.:                      05-0165831    3-8-2005
 
 Collateral:                   Taylor Model TH350L and equipment

   
 Debtor:                        Bowater Alabama Inc. 
 Secured Party:           Toyota Motor Credit Corporation 
 File No.:                      05-0184049    3-14-2005 
 Collateral:                   Toyota Forklift 
   
 Debtor:                        Bowater Alabama Inc. 
 Secured Party:           Toyota Motor Credit Corporation 
 File No.:                      06-1035446    12-7-2006 
 Collateral:                   New Toyota Forklift 
   
  Shelby County, Alabama 
 Debtor:                        Bowater Alabama LLC 
 Secured Party:            Wachovia Bank, National Association, as Administrative Agent 
 File No.:                      20080610000236530 6-10-2008 

Collateral:                    All fixtures located on the real property

   
  Talladega County, Alabama 
 Debtor:                        Bowater Alabama LLC

 Secured Party:            Wachovia Bank, National Association, as Administrative Agent 
 File No.:                      
175834            5-20-2008 
 Collateral:                    All fixtures located on the real property 
   
  BOWATER AMERICA INC. 
    
  Delaware Secretary of State 
 Debtor:                        Bowater America, Inc.

 Secured Party:           Wachovia Bank, National Association, as Administrative Agent 
 File No.:                      6187079
9       6-1-2006 
 Collateral:                    All Accounts, cash and currency, Chattel Paper, Deposit 
                             Accounts, Documents, General
Intangibles, Instruments, 
                                       Inventory,
Investment Property, Letter of Credit Rights, books 
                                      Records and proceeds

    
    

    
  BOWATER NUWAY INC. 
    
  Delaware Secretary of State 
 Debtor:                        Bowater Nuway Inc. 

Secured Party:            Wachovia Bank, National Association, as Administrative Agent 
 File No.:                       6187436
1       6-1-2006 
 Collateral:                    All Accounts, cash and currency, Chattel Paper, Deposit 
                                      Accounts, Documents,
General Intangibles, Instruments, 
                                      Inventory, Investment
Property, Letter of Credit Rights, books 
                                      Records and proceeds

   
    
  BOWATER NUWAY MID-STATES INC. 
    

 Delaware Secretary of State 
 Debtor:                        Bowater Nuway Mid-States Inc. 
 Secured Party:             Wachovia Bank, National Association, as Administrative Agent 
 File No.:                      61874312       
6-1-2006 
 Collateral:                     All Accounts, cash
and currency, Chattel Paper, Deposit 
                                    Accounts, Documents, General
Intangibles, Instruments, 
                                    Inventory, Investment Property,
Letter of Credit Rights, books 
                                    Records and proceeds 
    
    
  Canadian Credit Parties : 
    
  Bowater Canadian Forest Products Inc. 
  Bowater Produits Forestiers Du Canada Inc.
   
  Personal Property Security Act (Ontario ) 
    
  Debtor:                        Bowater Canadian Forest Products Inc./Bowater Produits Forestiers du Canada Inc.

                         
    Compagnie Abitibi-Consolidated du Canada – Abitibi-Consolidated Company of Canada. 
  Secured
Party:            Tristar Industries Ltd. 
 File
No.:                       652317084 
  Collateral:                    Equipment, Amount Secured $99, 744.00 
                             One 1400
series cloverotor pump assembly, s/n R143, with new Tristar 2204 duplex SS wetted/C1040 journal feeder rotor and new Tristar 2205 duplex ss wetted/C1040 journal feeder rotor and new Tristar 
                                        2205 duplex ss
wetted/316 non-wetted feeder housing, as per invoice no. 11525 and purchase order no. 15361580-OP, delivered to 145 Third Street West, Fort Frances, Ontario, P9N 3N2, and all proceeds 
                                        from the
collateral. 
   
  Debtor:                        Bowater Canadian Forest Products Inc. 
       Bowater Produits Forestiers du Canada Inc.
  
 
          Bowater Canadian Forest Products Inc./Bowater Produits Forestiers du Canada Inc.
 
        Bowater Produits Forestiers du Canada Inc./Bowater Canadian Forest Products Inc.
 Secured
Party:              The Bank of Nova Scotia 
 File
No.:                         650149533 
  Collateral:                      Equipment, Other 
                               Personal property now or hereafter attached to, incorporated in, or located on certain premises that are Canadian fixed assets, as defined in the credit agreement among, inter alia, the debtor and the secured 
                                          party
dated as of May 31, 2006, as amended from time to time. 
   
 
Debtor:                           Bowater Canadian Forest Products Inc. 
          Bowater Produits Forestiers du Canada Inc.
          Bowater Canadian Forest Products Inc. Bowater Produits Forestiers du Canada Inc.
 Secured Party:              CIT Financial Ltd. 
 File No.:                         649926378 
  Collateral:                      Equipment, Other

          Xerox copiers 
   
  Debtor:                           Bowater Canadian Forest Products Inc. 
          Bowater Produits Forestiers du Canada Inc.
          Bowater Canadian Forest Products Inc./Bowater Produits Forestiers Du Canada Inc. 
 Secured Party:              CIT Financial Ltd. 
 File No.:                         649287747 
  Collateral:                      Equipment, Other

                                         
Various Xerox copiers 
    
  Debtor:                          Bowater Canadian Forest Products Ltd. 
 Secured Party:              Xerox Canada Ltd. 
 File No.:                         646123815 
  Collateral:                      Equipment,
Other
                                         
Unspecified 
    
  Debtor:                         Bowater Canadian Forest Products Ltd. 
 Secured Party:             Xerox Canada Ltd. 
 File No.:                        645919092 
  Collateral:                     Equipment, Other

                                         Unspecified

    
  Debtor:                         Bowater Canadian Forest Products Inc. 
 Secured Party:             Xerox Canada Ltd. 
 File No.:                        645464196 
  Collateral:                     Equipment, Other

                                         Unspecified

    
  Debtor:                         Bowater Canadian Forest Products Inc. 
  
  
 
 Secured
Party:            Xerox Canada Ltd. 
 File
No.:                       644545296 
  Collateral:                    Equipment, Other

                                        Unspecified

    
  Debtor:                         Bowater Canadian Forest Products Inc. 
 Secured Party:             Xerox Canada Ltd. 
 File No.:                        634942845 
  Collateral:                     Equipment, Other

                                         Unspecified

    
  Debtor:                          Bowater Canadian Forest Products Inc. Bowater Produits Forestiers Du Canada Inc.

                                         
Bowater Canadian Forest Products Inc. 
                         
      Bowater Produits Forestiers Du Canada Inc.
 Secured
Party:              Liftcapital Corporation 
 File
No.:                         631842894 
  Collateral:                      Equipment,
Other
                                         
Material handling equipment together with all parts, attachments, accessories, additions, batteries, chargers, repair parts, and other equipment placed on or forming part of the goods described herein with 
                                          any
proceeds thereof and therefrom including, without limitation, all goods, securities, instruments, documents of title, chattel paper and intangibles (as defined in the PPSA)
    
   
 
  Debtor:                           Bowater Canadian Forest Products Inc. Bowater Produits Forestiers Du Canada
Inc.
          Bowater Canadian Forest Products Inc. 
       Bowater Produits Forestiers Du Canada Inc.
 Secured Party:              Liftcapital Corporation 
 File No.:                         628410015 
  Collateral:                      Equipment, Other
                                         
Material handling equipment together with all parts, attachments, accessories, additions, batteries, chargers, repair parts, and other equipment placed on or forming part of the goods described herein with 
                                          any
proceeds thereof and therefrom including, without limitation, all goods, securities, instruments, documents of title, chattel paper and intangibles (as defined in the PPSA) 
    
 
Debtor:                          Bowater Canadian Forest Products Inc. Bowater Produits Forestiers Du Canada
Inc.
         Bowater Canadian Forest Products Inc. 
       Bowater Produits Forestiers Du Canada Inc.
 Secured Party:              Liftcapital Corporation 
 File
No.:                         628410393 
  Collateral:                      Equipment,
Other
                                         
Material handling equipment together with all parts, attachments, accessories, additions, batteries, chargers, repair parts, and other equipment placed on or forming part of the goods described herein with 
                                          any
proceeds thereof and therefrom including, without limitation, all goods, securities, instruments, documents of title, chattel paper and intangibles (as defined in the PPSA) 
    

  Debtor:                            Bowater Canadian Forest Products Inc. 
 Secured Party:                Liftcapital Corporation 
 File No.:                           628415442 
  Collateral:                        Equipment, Other
                                          
  Material handling equipment together with all parts, attachments, accessories, additions, batteries, chargers, repair parts, and other equipment placed on or forming part of the goods described herein with 
                                          
  any proceeds thereof and therefrom including, without limitation, all goods, securities, instruments, documents of title, chattel paper and intangibles (as defined in the PPSA) 
    
 
Debtor:                             Bowater Canadian Forest Products Inc. Bowater Produits
Forestiers Du Canada Inc.
                                          
  Bowater Canadian Forest Products Inc. 
                         
        Bowater Produits Forestiers Du Canada Inc.
 Secured
Party:                 Liftcapital Corporation 
 File
No.:                            628415451 
  Collateral:                         Equipment, Other
                                          
  Material handling equipment together with all parts, attachments, accessories, additions, batteries, chargers, repair parts, and other equipment placed on or forming part of the goods described herein with 
                                          
  any proceeds thereof and therefrom including, without limitation, all goods, securities, instruments, documents of title, chattel paper and intangibles (as defined in the PPSA) 
    
  Debtor:                            Bowater Canadian Forest Products Inc. 
           Bowater Produits Forestiers Du Canada Inc.
           Bowater Canadian Forest Products Inc./Bowater Produits Forestiers Du Canada Inc.
           Bowater Produits Forestiers Du Canada Inc./Bowater Canadian Forest Products Inc.

 Secured Party:               The Bank of Nova Scotia, As Administrative Agent 

File No.:                          625578417
 
  Collateral:                       Inventory, Accounts, Other
                                         
Unspecified 
    
  Debtor:                            Bowater Canadian Forest Products Inc. 
 Secured Party:               CBSC Capital Inc. 
 File No.:                          619670709 
  Collateral:                       Equipment, Other
                                          All
goods supplied by the secured party pursuant to a lease between the debtor and the secured party, together with all parts and accessories thereto and accession thereto and all replacements or 
                                         
substitutions for such goods and proceeds thereof (proceeds as defined in the PPSA (ON) and any insurance proceeds resulting there from. 
    
  Debtor:                            Bowater Canadian Forest Products Inc. 
 Secured Party:                Location Park Avenue Complexe De L Auto Park Avenue 
 File No.:                           618067944 
  

  
  Collateral:                        Consumer Goods, Motor Vehicle Included
                                          
Amount Secured $37, 876
                                          
2005 Volvo V70, VIN: YV1SW612552494470 
    
  Debtor:                           
Bowater Canadian Forest Products Inc. 
                                Bowater Canadian Forest Products Inc./Bowater Produits Forestiers Du Canada Inc. 
                                Bowater Produits Forestiers Du Canada Inc./Bowater Canadian Forest Products Inc. 
                                Bowater Produits Forestiers Du Canada Inc.
  Secured
Party:               Dow Chemical Canada Inc. 
 File
No.:                          614842038 
  Collateral:                      
Inventory, Other
                                         
Unspecified 
    
 
Debtor:                           Bowater Canadian Forest Products Inc. 
 Secured Party:              Hewlett-Packard Financial Services Canada Company 
 File No.:                         614665962 
  Collateral:                      Equipment, Other
                                         
Equipment schedule, any and all equipment, tangible and intangible, pursuant to equipment schedule no. 1010320000004, and amendments thereto, under master lease agreement no. 101032, and 
                                          all
amounts owing thereunder. 
    
  Debtor:                           
Bowater Canadian Forest Products Inc 
 Secured Party:               Kinecor Inc. 

File No.:                          613074375
 
  Collateral:                       Inventory
                                         
Further to a consignment agreement, all goods consigned by the seller Kinecor Inc to the buyer Bowater Canadian Forest Products Inc,  such as but not restrictively bearings products, mechanical 
                                          drive
products, fluid power products hydraulics & pneumatics, rubber products, miscellaneous products such as chains, chucks, ladders, brushes, saginaw, shim, shelving, bearing analysis tools. 
                                         
Process equipment such as Wilden Pump, Rotojet Pump, Netzsch Pump, National Pump, Varisco Pump, Walchem, Alma Submerible Pump, Envirqip Mixers, PNR Spray Nozzle. Above Products Manufactured 
                                          by
SKF, NTN, FAG, Garlock Renold, Rexnord, E.P.T., FALK, Eurodrive, Timken, Torrington, Dodge, Gates, Goodyear, Martin Sprockets, SM Cyclo, QM Bearings, AR Thompson, Loctite, Technical 
                                         
Service Canada. 
    
  Debtor:                           Bowater
Canadian Forest Products Inc 
 Secured Party:              Kinecor Inc. 
 File No.:                         612998055 

 Collateral:                      Inventory
                                          All
goods consigned by the seller Kinecor Inc to the buyer Bowater Canadian Forest Products Inc further to a consignment contract such as but not restrictively bearing products, mechanical drive 
                                         
products, fluid power products hydraulics & pneumatics, rubber products, sealing products, specialty products, industrial supply products, miscellaneous products such as chains, chucks, ladders, 
                                         
brushes, saginaw, shim, shelving, bearing analysis tools, process equipment such as wilden pump, rotojet pump, netzsch pump, national pump, varisoc pump, walchem, alma submersible pump, envirqip 
                                         
mixers, pnr spray nozzle. Above products are manufactured by the following companies, SKF, NTN, FAG, Garlock Renold, Rexnord, E.P.T., Falk, Eurodrive, Timken, Torrington, Dodge, Gates, Goodyear, 
                                         
Martin Sprockets, SM Cyclo, QM Bearings, AR Thompson,  Loctite, Technical Service Canada. 
   

  Debtor:                           Bowater Canadian Forest Products Inc. 
 Secured Party:               Xerox Canada Ltd 
 File No.:                          609515721 
  Collateral:                      
Equipment, Other
                                         
Unspecified 
    
 
Debtor:                            Bowater Canadian Forest Products Inc. Purchasing 
  Secured Party:                Xerox Canada Ltd 
 File No.:                           609515748 
  Collateral:                        Equipment, Other
                                          
Unspecified 
    
 
Debtor:                           Bowater Canadian Forest Products Inc. 
  Secured Party:               GE Technology Finance 
          Financement De Technologie GE 
 File No.:                         608766786 
  Collateral:                      Equipment,
Other
                                          All
property leased by secured party to debtor from time to time forming part of master lease agreement number MLTBW001. 
    
  Debtor:                          Bowater Canadian Forest Products Inc. 
         Bowater Produits Forestiers Du Canada Inc.
         Bowater Canadian Forest Products Inc. Bowater Produits Forestiers Du Canada Inc.
  Secured Party:             Dell Financial Services Canada 
 File No.:                        607656465 
  Collateral:                     Equipment, Other

                                        All Dell and Non
Dell computer equipment and peripherals wherever located heretofore or hereafter leased to debtor by secured party pursuant to an equipment lease 678996-001 together with all 
                                        substitutions,
additions, accessions and replacements thereto and thereof now and hereafter installed in, affixed to, or used in conjunction with such equipment and proceeds thereof together with all rental 
                                        or installment
payments, insurance proceeds, other proceeds and payments due or to become due and arising from or relating to such equipment, proceeds, all present and after-acquired personal property.
    
  Debtor:                        Bowater Canadian Forest Products Inc. 
       Bowater Produits Forestiers Du Canada Inc.
       Bowater Canadian Forest Products Inc. Bowater Produits Forestiers Du Canada Inc.
       Bowater Produits Forestiers Du Canada Inc. Bowater Canadian Forest Products Inc. 
  Secured Party:            GE Capital Vehicle And Equipment Leasing Inc. 
  
 
  
 File
No.:                       893880549 
  Collateral:                    Inventory, Equipment, Accounts, Other, Motor Vehicle Included
                                        All present and
after acquired motor vehicles, trailers, and goods, of whatever make or description, now or hereafter leased by secured party to debtor, together with all additions, replacement parts, 
                                        accessions,
attachments and improvements thereto, and all proceeds, including money, chattel paper, intangibles, goods, documents of title, instruments, securities, substitutions, accounts receivable, rental 
                                        and loan
contracts, all personal property returned, traded in or repossessed and all insurance proceeds and any other form of proceeds.
 
  
  Debtor:                       Bowater Canadian Forest Products Inc. 
      Abitibi-Consolidated Inc. 
    Abitibi-Consolidated Company of Canada
      Compagnie Abitibi-Consolidated Du Canada 
 
Secured Party:          Caterpillar Financial Services Ltd. 
 File
No.:                     885415995 
  Collateral:                  Equipment,
Other, Motor Vehicle Included
                                      2002 Caterpillar D7R II XR,
VIN: CAT00D7RPAGN00520 
                                      Allied model W8L Winch S/N
AW8LP3N2579C72. 
    
  Debtor:                      Bowater Canadian Forest Products
Inc. 
     Bowater Produits Forestiers Du Canada Inc.
     Bowater Canadian Forest Products Inc. Bowater Produits Forestiers Du Canada Inc.
     Bowater Produits Forestiers Du Canada Inc. Bowater Canadian Forest Products Inc.
  Secured Party:          IBM Canada Limited – PPSA Administrator 
 File No.:                     884709945 
  Collateral:                  Equipment, Accounts, Other

                                      All present and after
acquired personal property supplied by the secured party. 
    
  Debtor:                      Bowater 
     Bowater, Thunder Bay 
     Bowater Canadian Forest Products Inc. 
   Abitibibowater Inc. 
  Secured
Party:         Astenjohnson, Inc. 
  File
No.:                    871737759 
 
Collateral:                 Inventory
                                     Unspecified 
    
 
  
  Personal Property Security Act (Nova Scotia ) 
    
    
 Debtor:                        Bowater Canadian Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc.
                                      Bowater Canadian Forest
Products Inc. Bowater Produits Forestiers du Canada Inc.
                                      Bowater Produits
Forestiers du Canada Inc. Bowater Canadian Forest Products Inc. 
  

  
  Secured Party:           The Bank of Nova Scotia, as administrative agent 
  File No.:                      11084639 
  Collateral:                   A SECURITY
INTEREST IS TAKEN IN ALL OF THE DEBTOR'S RIGHT, TITLE AND INTEREST IN THE FOLLOWING: 
  A. ALL ACCOUNTS, INCLUDING FOR GREATER CERTAINTY, ALL
DEPOSIT ACCOUNTS; 
  B. ALL INVENTORY; 
  C. ALL INSTRUMENTS IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  D. ALL DOCUMENTS OF TITLE AND CHATTEL PAPER IN RESPECT OF THE DEBTOR'S 
  INVENTORY AND ACCOUNTS; 
  E. ALL MONEY; 
 
F. ALL INTANGIBLES; 
  F. ALL BOOKS, INVOICES, DOCUMENTS AND OTHER RECORDS IN ANY FORM EVIDENCING OR RELATING TO ANY OF THE
FOREGOING PROPERTY AND ASSETS OF THE DEBTOR; AND 
  G. ALL PROCEEDS. 
  THE SECURITY INTEREST SHALL NOT EXTEND TO (A) ANY SHARES OF CAPITAL STOCK OF A SUBSIDIARY OR AFFILIATE OF THE DEBTOR OR (B) ANY EQUIPMENT OR ANY FIXED ASSETS OF THE
DEBTOR.. 
  FOR THE PURPOSES OF THIS REGISTRATION, THE TERMS "ACCOUNTS", "DEPOSIT
ACCOUNTS", "INVENTORY", "INSTRUMENTS", "DOCUMENTS OF TITLE", "CHATTEL PAPER", "MONEY", "INTANGIBLES", "PROCEEDS", "CAPITAL STOCK", "SUBSIDIARY",
"AFFILIATE" OR "EQUIPMENT" SHALL HAVE THE MEANINGS ATTRIBUTED TO SUCH TERMS IN THAT CERTAIN COLLATERAL AGREEMENT DATED ON OR ABOUT MAY 30, 2006 BY AND AMONG THE DEBTOR AS GRANTOR IN FAVOUR OF THE SECURED PARTY, AS ADMINISTRATIVE
AGENT AS THE SAME MAY BE AMENDED, SUPPLEMENTED, RESTATED OR REPLACED FROM TIME TO TIME. 
    
 Debtor:                        Bowater Canadian Forest
Products Inc. 
                            
Bowater Produits Forestiersdu Canada Inc. 
                             Bowater Canadian Forest
Products Inc. Bowater Produits Forestiers du Canada Inc. 
  Secured Party:           
LiftCapital Corporation 
  File
No.:                       11749876 
  Collateral:                    MATERIAL HANDLING EQUIPMENT TOGETHER WITH ALL PARTS, ATTACHMENTS, ACCESSORIES, ADDITIONS, BATTERIES,
CHARGERS, REPAIR PARTS, AND OTHER EQUIPMENT PLACED 
                                        ON OR FORMING
PART OF THE GOODS DESCRIBED HEREIN WITH ANY PROCEEDS THEREOF AND THEREFROM INCLUDING, WITHOUT LIMITATION, ALL GOODS, SECURITIES, 
                                        INSTRUMENTS,
DOCUMENTS OF TITLE, CHATTEL PAPER AND INTANGIBLES (AS DEFINED IN THE PERSONAL PROPERTY SECURITY ACT). 
                         
    4 -  2006 Yale Mdl GLP060VX LP Lift Trucks 
    
   

  
 Debtor:                        Bowater Canadian Forest Products Inc. 
                             Bowater Produits Forestiers du
Canada Inc.
                                      Bowater Canadian Forest
Products Inc. Bowater Produits Forestiers du Canada Inc.
                                      Bowater Produits
Forestiers du Canada Inc. Bowater Canadian Forest Products Inc. 
  Secured
Party:            The Bank of Nova Scotia 
  File
No.:                       14694830 
  Collateral:                    ALL PERSONAL
PROPERTY, INCLUDING WITHOUT LIMITATION, ALL GOODS, DOCUMENTS OF TITLE, CHATTEL PAPER, SECURITIES, INSTRUMENTS, MONEY AND INTANGIBLES, NOW 
                                        OR HEREAFTER
ATTACHED TO, INCORPORATED IN, REALIZED FROM OR AS A RESULT OF, LOCATED ON OR ASSOCIATED WITH THE CANADIAN FIXED ASSETS, AS DEFINED IN THE 
                                        CREDIT AGREEMENT,
AMONG, INTER ALIA, THE DEBTOR AND THE SECURED PARTY DATED AS OF MAY 31, 2006, AS AMENDED, SUPPLEMENTED OR REPLACED FROM TIME TO TIME,  
                                        WHICH CANADIAN
FIXED ASSETS INCLUDE, WITHOUT LIMITATION, EACH MILL OWNED BY THE DEBTOR, THE REAL PROPERTY ON WHICH EACH SUCH MILL IS SITUATED, ALL  
                                        EQUIPMENT USED IN
CONNECTION WITH EACH SUCH MILL AND ALL OTHER RIGHTS AND ASSETS USED FOR THE OPERATION, ADMINISTRATION AND MAINTENANCE OF EACH SUCH 
 
                                      MILL, AND
ALL PROCEEDS THEREOF IN ANY FORM INCLUDING GOODS, DOCUMENTS OF TITLE, CHATTEL PAPER, SECURITIES, INSTRUMENTS, MONEY AND INTANGIBLES.
    
   
   
  Personal Property Security Act (New Brunswick ) 
    
 Debtor:                        Bowater Canadian Forest Products Inc. 
                             Bowater Produits Forestiers du
Canada Inc.
                                      Bowater Canadian Forest
Products Inc. Bowater Produits Forestiers du Canada Inc.
                                      Bowater Produits
Forestiers du Canada Inc. Bowater Canadian Forest Products Inc. 
  Secured
Party:            The Bank of Nova Scotia, as administrative agent 
  File
No.:                       13596010 
  Collateral:                    A SECURITY INTEREST IS TAKEN IN ALL OF THE DEBTOR'S RIGHT, TITLE AND INTEREST IN THE FOLLOWING: 

 A. ALL ACCOUNTS, INCLUDING FOR GREATER CERTAINTY, ALL DEPOSIT ACCOUNTS; 
  B. ALL INVENTORY; 
  C. ALL INSTRUMENTS IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  D. ALL DOCUMENTS OF TITLE AND CHATTEL PAPER IN RESPECT OF THE DEBTOR'S 
  INVENTORY AND ACCOUNTS; 
  E. ALL MONEY; 
  F. ALL INTANGIBLES; 
   
  
 
  
  F. ALL BOOKS, INVOICES, DOCUMENTS AND OTHER RECORDS IN ANY FORM EVIDENCING OR
RELATING TO ANY OF THE FOREGOING PROPERTY AND ASSETS OF THE DEBTOR; AND
  G. ALL PROCEEDS.THE SECURITY INTEREST SHALL NOT EXTEND TO (A) ANY
SHARES OF CAPITAL STOCK OF A SUBSIDIARY OR AFFILIATE OF THE DEBTOR OR (B) ANY EQUIPMENT OR ANY FIXED ASSETS OF THE DEBTOR. FOR THE PURPOSES OF THIS REGISTRATION, THE TERMS "ACCOUNTS", "DEPOSIT ACCOUNTS", "INVENTORY",
"INSTRUMENTS", "DOCUMENTS OF TITLE", "CHATTEL PAPER", "MONEY", "INTANGIBLES", "PROCEEDS", "CAPITAL STOCK", "SUBSIDIARY", "AFFILIATE" OR "EQUIPMENT"
SHALL HAVE THE MEANINGS ATTRIBUTED TO SUCH TERMS IN THAT CERTAIN COLLATERAL AGREEMENT DATED ON OR ABOUT MAY 30, 2006 BY AND AMONG THE DEBTOR AS GRANTOR IN FAVOUR OF THE SECURED PARTY, AS ADMINISTRATIVE AGENT AS THE SAME MAY BE AMENDED, SUPPLEMENTED,
RESTATED OR REPLACED FROM TIME TO TIME. 
    
 Debtor:                        Bowater Canadian Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc.
                                      Bowater Canadian Forest
Products Inc. Bowater Produits Forestiers du Canada Inc.
                                      Bowater Produits
Forestiers du Canada Inc. Bowater Canadian Forest Products Inc. 
  Secured
Party:           The Bank of Nova Scotia 
  File
No.:                      16953705 
  Collateral:                   ALL PERSONAL PROPERTY,
INCLUDING WITHOUT LIMITATION, ALL GOODS, DOCUMENTS OF TITLE, CHATTEL PAPER, SECURITIES, INSTRUMENTS, MONEY AND INTANGIBLES, NOW 
 
                                    OR HEREAFTER ATTACHED
TO, INCORPORATED IN, REALIZED FROM OR AS A RESULT OF, LOCATED ON OR ASSOCIATED WITH THE CANADIAN FIXED ASSETS, AS DEFINED IN THE 
 
                                    CREDIT AGREEMENT,
AMONG, INTER ALIA, THE DEBTOR AND THE SECURED PARTY DATED AS OF MAY 31, 2006, AS AMENDED, SUPPLEMENTED OR REPLACED FROM TIME TO TIME, 
                                      WHICH CANADIAN FIXED ASSETS
INCLUDE, WITHOUT LIMITATION, EACH MILL OWNED BY THE DEBTOR, THE REAL PROPERTY ON WHICH EACH SUCH MILL IS SITUATED, ALL 
                                      EQUIPMENT USED IN CONNECTION
WITH EACH SUCH MILL AND ALL OTHER RIGHTS AND ASSETS USED FOR THE OPERATION, ADMINISTRATION AND MAINTENANCE OF EACH SUCH 
                                      MILL, AND ALL PROCEEDS
THEREOF IN ANY FORM INCLUDING GOODS, DOCUMENTS OF TITLE, CHATTEL PAPER, SECURITIES, INSTRUMENTS, MONEY AND INTANGIBLES . 
                                          
                                         
                   
 Debtor:                        Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            National Leasing Group Inc. 
  File No.:                       11486289 
  Collateral:                    All Mobile Radios & Communications Systems of every nature or kind described in Lease Number 2274380,
together with all attachments, accessories and substitutions. 
    

 Debtor:                        Bowater Produits Forestiers du Canada Inc

                                       Bowater Canadian
Forest Products Inc 
  Secured Party:            National Leasing Group Inc.

  File No.:                      
10958106 
  Collateral:                    All Mobile Radios & Communications Systems of every nature or kind described in Lease Number 2256229
dated May 6, 2004.  
    
  Register of Personal and Movable Real Rights (Quebec) 
    
 Debtor:                        Bowater Canadian Forest Products Inc. 
                                      Bowater Produits
Forestiers du Canada Inc. 
                             Produits Forestiers Alliance
Inc. 
  Secured Party:            Caterpillar Financial Services Limited

  File No.:                      
99-0165061-0003 
  Collateral:                    1998 Niveleuse Caterpillar modele 163H n/s-5AK00183 
    
 Debtor:                        Bowater Canadian Forest Products Inc 
                                      Bowater Produits
Forestiers du Canada Inc 
                             Produits Forestiers Alliance
Inc. 
                             Alliance Forest Products Inc. 
  Secured Party:            Caterpillar
Financial Services Limited 
  File
No.:                       01-0151120-0002 
  Collateral:                    un (1) 2001
mini-chargeuse sur pneus caterpillar modele 902, N/S 7ES00594 

 
 Debtor:                        Bowater Canadian Forest Products Inc. 
                                      Bowater Produits
Forestiers du Canada Inc. 
                             Bowater Canadian Forest
Products Inc./Bowater Produits Forestiers Du Canada Inc.
                                      Bowater Produits
Forestiers Du Canada Inc./Bowater Canadian Forest Products  Inc.
  Secured
Party:            LEAF Trust 
  File
No.:                       99-0211113-0001 
  Collateral:                    All present and
future motor vehicles (including, without limitation, passenger automobiles, trucks, truck tractors, truck trailers, truck chassis, or truck bodies), automotive equipment (including, without 
                                        limitation,
trailers, boxes and refrigeration units), and materials-handling equipment leased from time to time by the Lessor to the Lessee, together with all present and future attachments, 
                                        accessions,
appurtenances, accessories and replacement parts, and all proceeds of or relating to any of the foregoing.

 
 Debtor:                        Bowater Canadian Forest Products Inc. 
                                       Bowater Produits
Forestiers du Canada Inc. 
  Secured Party:            Les Services Financiers
Caterpillar Limitee 
  File
No.:                       03-0185891-0001 
  Collateral:                    1998 chargeur sur
pneus caterpillar modele 962G, N/S: 4PW00244
 
 

    
 Debtor:                        Bowater Produits Forestiers du Canada
Inc. 
  Secured Party:            Services Financiers CIT Ltée 
  File No.:                      
 04-0192665-0001 
  Collateral:                    75 RADIOS PORTATIFS MOTOROLA TRUNKING MODÈLE MTX-850-8250 
INCLUANT: CHARGEUR, 2 PILES,
ÉTUI-ATTACHE, MICROPHONE EXTENSIBLE 
N/S 749TDY0757, 749TDY0758, 749TDY0759, 749TDY5444, 749TDY5445, 749TDY5446, 749TDY5447, 749TDY5448, 749TDY5449, 749TDY5450, 749TDY5451, 749TDY5452, 749TDY5454, 749TDY5455, 749TDY5457, 749TDY5458,
749TDY5459, 749TDY5460, 749TDY5462, 749TDY5464, 749TDY5465, 749TDY5468, 749TDY5469, 749TDY5470, 749TDY5472, 749TDY5473, 749TDY5474, 749TDY5475, 749TDY5476, 749TDY5477, 749TDY5478, 749TDY5479, 749TDY5480, 749TDY5499, 749TDY5502, 749TDY5503,
749TDY5507, 749TDY5509, 749TDY5513, 749TDY5520, 749TDY5521, 749TDY5522, 749TDY5523, 749TDY5524, 749TDY5525, 749TDY5526, 749TDY5527, 749TDY5528, 749TDY5530, 749TDY5531, 749TDY5532, 749TDY5533, 749TDY5534, 749TDY5535, 749TDY5536, 749TDY5537,
749TDY5538, 749TDY5539, 749TDY5540, 749TDY5541, 749TDY5542, 749TDY5544, 749TDY5545, 749TDY5546, 749TDY5547, 749TDY5549, 749TDY5550, 749TDY5552, 749TDY5553, 749TDY5554, 749TDY5555, 749TDY5556, 749TDY5559, 749TDY5579, 749TDY5600 
3 BASES MOTOROLA
TRUNKING MAXLS INCLUANT: UNITÉ DE POUVOIR, ANTENNE, MICROPHONE N/S 255085, 255088, 255089    
11 BASES UNIDEN TRUNKING SVS8025 
INCLUANT: UNITÉ DE POUVOIR, ANTENNE, MICROPHONE N/S 249256, 401452, 85000555, 85000569,
99000576, 99000577,     75000123, 75000114, 75000144, 75000183, 99000585

  
   
 
 Debtor:                        Bowater
Canadian Forest Products Inc. 
  Secured Party:            Xerox Canada Ltd

  File No.:                      
04-0583228-0020 
  Collateral:                    Equipment, Other 
                                       All present and future
office equipment and software supplied or financed from time to time by the secured party (whether by lease, conditional sale or otherwise), whether or not manufactured by the secured 
                                       party or any affiliate
thereof. 
    
 Debtor:                        Bowater Canadian Forest Products Inc. 
                                      Bowater Produits
Forestiers du Inc. 
  Secured Party:            Citicorp Vendor Finance, Ltd

                                       Citicorp Finance
Vendeur Ltee 
  File
No.:                       04-0631741-0015 
  Collateral:                    2 - BIZ HUB C350,
1 - DI5510, 2 - DI2510 COPIER and accessories with all attachments, accessories and proceeds thereof including insurance proceeds and indemnities. 
  
 Debtor:                        Bowater Canadian Forest Products Inc 
  Secured Party:            Systèmes de Distribution Intégrés, Société en Commandite

                                       Integrated
Distribution Systems Limited Partnership 
  
    

  
  File No.:                      
05-0110857-0001 
  Collateral:                    TOUS LES BIENS CONSIGNES PAR LE VENDEUR A L'ACHETEUR SUIVANT UN CONTRAT DE CONSIGNATION TELS QUE, MAIS NON
LIMITATIVEMENT: BEARING PRODUCTS, MECHANICAL 
                                        DRIVE PRODUCTS,
ELECTRICAL DRIVE PRODUCTS, FLUID POWER PRODUCTS HYDRAULICS & PNEUMATICS, RUBBER PRODUCTS, SEALING PRODUCTS, SPECIALTY PRODUCTS, 
                                        INDUSTRIAL SUPPLY
PRODUCTS, MISCELLANEOUS PRODUCTS, SUCH A S CHAINS, CHICKS, LADDERS, BRUSHES, SAGINAW, SHIM, SHELVING, BEARING ANALYSIS TOOLS,  
 
                                      PROCESS
EQUIPEMENT SUCH AS WILDEN PUMP, ROTOJET PUMP, NETZCH PUMP,NATIONAL PUMP,VARISCO PUMP, WALCHEM, AIMA SUBMERSIBLE PUMP, ENVIRQIP MIXERS, PNR 
                                        SPRAY NOZZLE.

  
                                        ABOVE PRODUCTS
ARE MANUFACTURED BY THE FOLLOWING COMPANIES: SKF, NTN, FAG, GARLOCK, RENOLD, REXNORD, E.P.T., FALK, EURODRIVE, TIMKEN, TORRINGTON, DODGE, 
                                        GATES, GOODYEAR,
MARTIN SPROCKETS, SM CYCLO, QM BEARINGS, AR THOMPSON, LOCTITE, TECHNICAL SERVICE CANADA. 
    
 Debtor:                        Bowater Canadian Forest
Products Inc. 
                                      Bowater Produits
Forestiers du Canada Inc. 
  Secured Party:            Les Services Financiers
Caterpillar Limitee 
  File
No.:                       05-0217207-0001 
  Collateral:                    2002 chariot
elevateur Caterpillar, modele GC45KLPSWB, N/S AT8702315 
    
 Debtor:                        Bowater Canadian Forest Products Inc.

                                      Bowater Produits
Forestiers du Canada Inc. 
                                      Bowater 
  Secured Party:           Société de Services De Crédit-Bail GE Canada
  File
No.:                      05-0508800-0001
  Collateral:                   (1) Station centrale
modèle SR-500 Slim de marque SRTelecom, 2005 (Mistassini), n/s102241; (1) Répéteur modèle Slim repeater de marque SRTelecom, 2005, (Côteau Marcil), n/s : 148260; (1) Répéteur modèle 
                                      Slim repeater de marque
SRTelecom, 2005, (Lac Hémon), n/s :148263; (1) Répéteur modèle Slim repeater de marque SRTelecom, 2005, (Bureau), n/s : 148272; (1) Répéteur modèle Slim repeater de marque 
                                      SRTelecom, 2005, (Mont
Mistassini), n/s : 148274; (1) Répéteur modèle Slim repeater de marque SRTelecom, 2005, (KM 148), n/s : 148273; (1) Répéteur modèle Slim repeater de marque SRTelecom, 2005, 
                                      (Lac Husky), n/s : 148277;
(1) Camp (outstation) modèle Outstation Slim de marque SRTelecom, 2005 (Bureau), n/s :214854; (1) Camp (outstation) modèle Outstation Slim de marque SRTelecom, 2005 
                                      (Camp Daniel), n/s : 214859;
(1) Camp (outstation) modèle Outstation Slim de marque SRTelecom, 2005 (Camp Maupertuis), n/s : 214841.    
 
                                    Les biens décrits
aux présentes, où qu'ils se trouvent, ainsi que l'ensemble des droits de propriété intellectuelle, biens incorporels et accessoires s'y rattachant et des pièces de rechange, présents et futurs.  
    
 Debtor:                       Bowater Canadian Forest Products Inc. 
                                     Bowater Produits Forestiers
du Canada Inc. 
  Secured Party:           The Bank of Nova Scotia 
  
 
  
                                      La Banque de
Nouvelle-Écosse
  File
No.:                      06-0308066-0001
  Collateral:                   The following property
(collectively, the "Hypothecated Property"): 
I) all present and future Inventory (wherever located) and Receivables (wherever the debtor of same may be located); 
II) the proceeds of any sale, lease or other disposition or of the
collection of the property described in Section I and any debt resulting from such sale, lease or other disposition, and all proceeds of insurance covering the said property; and 
III) all present and future books, records, registers (including
those in a computerized form) and documents of the Grantor evidencing or accessory to the property described in Sections I and II; 
provided that (i) the Hypothecated Property shall in no event include any shares of Capital Stock of a Subsidiary
or Affiliate (as each such term is defined in the Credit Agreement) of the Grantor, (ii) the Hypothecated Property shall in no event include any equipment or any fixed assets of the Grantor, and (iii) the hypothec granted herein shall not extend to,
and the term "Hypothecated Property" shall not include, any rights under any lease, contract or agreement to the extent that the granting of a hypothec thereon is specifically prohibited in writing by, or would constitute an event of
default under or grant a party a termination right under any agreement governing such right unless such prohibition is not enforceable or is otherwise ineffective under applicable law. Notwithstanding anything in clause (iii) above to the contrary,
such proviso shall not affect, limit, restrict or impair the grant by the Grantor of a hypothec on any Receivable due and payable to the Grantor or to become due and payable to the Grantor under such lease, contract or agreement, unless such
hypothec on such Receivable is also specifically prohibited by the terms of such lease, contract or agreement or such hypothec on such Receivable would expressly constitute an event of default under or would expressly grant a party a termination
right under any such lease contract or agreement, in each case unless such prohibition is not enforceable or is otherwise ineffective under applicable law; provided further that notwithstanding anything to the contrary contained in the foregoing
proviso, the hypothec granted herein shall immediately extend to and the term "Hypothecated Property" shall immediately include the rights under any such lease, contract or agreement and in such Receivable at such time as such prohibition,
event of default or termination right shall terminate or shall be waived. 
    
 Debtor:                        Bowater Produits Forestiers du Canada
Inc. 
  Secured Party:            Roynat Inc. 
  File No.:                       06-0319898-0001 
  Collateral:                    1 chariot elevateur hyster, modele e60z,annee 2005,serie:g108v04758c,together with all attachments
accessories accessions replacements substitutions additions and improvements thereto and all proceeds in any
                                        form derived
directly or indirectly from any sale and or dealings with the collateral and a right to an insurance payment or other payment that indemnifies or compensates for loss or damage to the collateral 
                                        or proceeds of
the collateral. 
    
 Debtor:                        Bowater Canadian Forest Products Inc. 
                                      Bowater Produits
Forestiers du Canada Inc. 
  Secured Party:            Export Development Canada
 
  File
No.:                       06-0626682-0002 
  
 
  
  Collateral:                    Absolute
assignment of all the present and future claims, accounts and other intangibles representing the refund of all cash deposits together with all accrued interest on such deposits to which the United 
                                        States Customs
and Border Protection has determined the debtor is entitled under the Softwood Lumber Agreement entered into between the Government of Canada and the Government of the United 
                                        States,
including, without limitation: the refund of all deposits covered by the "Antidumping Duty Order regarding Certain Softwood Lumber from Canada", 67 Fed.Reg.36,068 (May 22, 2002), as amended; and 
                                        the refund of all
deposits covered by the "Countervailing Duty Order regarding Certain Softwood Lumber from Canada", 67 Fed.Reg.36,070 (May 22, 2002), as amended. 
    
 Debtor:                        Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            Gemofor inc. 
  File No.:                       07-0038692-0001 
  Collateral:                     - un optimiseur linéaire "OPTIFOR", numéro de série OP-2003-28069; - un convoyeur
de l'entrée de l'optimiseur linéaire (1 courroie F.B. trois plis, insonorisé avec couvercle à penture sur une partie, longueur 7',
                                        largeur 16",
motorisation: 5HP, diamètre du rouleau de tête: 12", diamètre du rouleau de pied: 8", rouleau de tête recouvert, tendeur à vis); trois (3) étampeuses; structure de support de l'optimiseur;
passerelles;
                                        réservoir
d'encre; système de tension avec cylindres pneumatiques pour le poste de classification;  pivot hydraulique pour le poste de classification; pièces de rechange.
   
 Debtor:                        Bowater Canadian Forest Products Inc. 
                                      Bowater Produits
Forestiers du Canada Inc. 
                             Bowater Canadian Forest
Products Inc. Bowater Produits Forestiers du Canada Inc.
  Secured Party:           
Liftcapital Corporation 
  File
No.:                       07-0082891-0001 
  Collateral:                    ONE NEW 2006 YALE
MDL GLP080VX LP GAS SIT DOWN LIFT TRUCK, s/n F813V01804E c/w Cascade Mdl 70D-TAL-SP Clamp 
                                        ONE NEW 2006 YALE
MDL ERC060GH ELECTRIC SIT DOWN LIFT TRUCK, s/n A908N05857E c/w Cascade Mdl 45F Paper Roll Clamp 
    

Debtor:                        Bowater Canadian Forest
Product Inc. 
  Secured Party:            Xerox Canada Ltd 
  File No.:                      
07-0161885-0008 
  Collateral:                    Equipment, Other 
                                       All present and future
office equipment and software supplied or financed from time to time by the secured party (whether by lease, conditional sale or otherwise), whether or not manufactured by the secured 
                                       party or any affiliate
thereof. 
    
 Debtor:                        Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            Complexe de l'Auto Park Avenue 
  File No.:                       07-0721309-0008

Collateral:                    Road Vehicle, HONDA ODYSSEY, VIN: 5FNRL38848B501691 
    
 Debtor:                        Bowater Produits Forestiers du Canada Inc. 
  

  
  Secured
Party:            Xerox Canada Ltd 
  File
No.:                       08-0179455-0005 
  Collateral:                    Equipment, Other 
                                       All present and future
office equipment and software supplied or financed from time to time by the secured party (whether by lease, conditional sale or otherwise), whether or not manufactured by the secured 
                                       party or any affiliate
thereof. 
    
 Debtor:                        Bowater Canadian Forest Products Inc. 
                                      Bowater Produits
Forestiers du Canada Inc. 
  Secured Party:           The Bank of Nova Scotia

  File No.:                      
08-0674019-0001 
  Collateral:                     1.   The following property: 
1.1   all of the rights, title and interest of the
Grantor in the Immovable Property as well as the following universalities: A.   all Machinery; B.   all Insurance; and C.   all Other Mill Property; 
1.2   all proceeds of any sale, lease or other
disposition or of the collection of the property described in Section 1.1 and any debt resulting from such sale, lease or other disposition; and 
1.3   all present and future books, records, registers (including those in a computerized
form) and documents of the Grantor evidencing or accessory to the property described in Sections 1.1 and 1.2. 
 
  
 Debtor:                        Bowater Canadian Forest Products Inc. 
  Secured Party:            Asten Johnson, inc. 
  File No.:                       09-0015195-0004 
  Collateral:                    The universality of consumable inventories of stock paper machine clothing, in the form of forming fabrics,
press fabrics, dryer fabrics and specialty fabrics (the "property"), furnished from time to time by  
                                        the seller to the
purchaser, and all proceeds thereof, derived directly and indirectly from any dealing with the property. 
 
  
 Debtor:                        Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            Systèmes de Distribution
Intégrés, Société en Commandite par son associée commanditée Fiducie Wajax Commanitée, par son fiduciaie, Wajax, associée commandité Holdco Inc, exploitant son activité sous le 
                                        nom Wajax
industries   
  File
No.:                       09-0157668-0001
 Collateral:                    chariots élévateurs Hyster 2004  
modèle              série 
  H80XM       L005V02369B 
  E60Z            G108V01950B 
                  E60Z            G108V01951B 
    
 Debtor:                        Bowater Canadain Forest Products Inc. 
                             Bowater Produits Forestiers du
Canada Inc. 
  Secured Party:            GE Vehicle And Equipment Leasing

  File No.:                      
04-0066565-0012
Collateral:                    Road Vehicle, GMC SIERRA 1500, VIN: 1GTEC14VX4Z252185 
                             Pursuant the
lease agreement dated DEC.12,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash 
                                       and non-cash proceeds
of the vehicle(s) described above. 
    

 Debtor:                        Bowater Canadain Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            GE
Vehicle And Equipment Leasing 
  File
No.:                      
04-0238274-0009
Collateral:                    Road Vehicles VIN: 1G1ZT54894F213469 and VIN: KNDJC733845261606 
                             Pursuant the
lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash 
                                       and non-cash proceeds
of the vehicle(s) described above. 
    
 Debtor:                        Bowater Canadain Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            GE
Vehicle And Equipment Leasing 
  File
No.:                      
04-0307444-0007
Collateral:                    Road Vehicle, DODGE GRAND CARAVAN, VIN: 1D4GP24R04B525152 
                             Pursuant the
lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash 
                                        and non-cash
proceeds of the vehicle(s) described above. 
    
 Debtor:                        Bowater Canadain Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            GE
Vehicle And Equipment Leasing 
  File
No.:                      
04-0546699-0012
Collateral:                    Road Vehicle, CHEVROLET SILVERADO 25, VIN: 1GCHK24U85E132438 
                             Pursuant the
lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash 
                                       and non-cash proceeds
of the vehicle(s) described above. 
    
 Debtor:                        Bowater Canadain Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            GE
Vehicle And Equipment Leasing 
  File
No.:                      
04-0686897-0006
Collateral:                    Road Vehicle, KIA SORENTO 4X4, VIN: KNDJC733845243588 
                             Pursuant the
lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash 
                                       and non-cash proceeds
of the vehicle(s) described above. 
    
 Debtor:                        Bowater Canadain Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc. 
  Secured Party:            GE
Vehicle And Equipment Leasing 
  File
No.:                      
04-0718900-0010
Collateral:                    Road Vehicle, CHRYSLER 300C, VIN: 2C3JA63H85H639773 
                             Pursuant the
lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash 
                                       and non-cash proceeds
of the vehicle(s) described above. 
    

 Debtor:                        Bowater Canadain Forest Products Inc.

                             Bowater Produits Forestiers du Canada Inc. 
                             Bowater Canadain Forest
Products Inc./ Bowater Produits Forestiers du Canada Inc 
                             Bowater Produits Forestiers du
Canada Inc./ Bowater Canadain Forest Products Inc 
  Secured
Party:            GE Vehicle And Equipment Leasing 
  File
No.:                       05-0053896-0010 
  Collateral:                    2 Road Vehicles, DODGE DAKOTA 4X2 C, VIN: 1D7HE22K85S249257 and VIN: 1D7HE22K65S249256 
                         
    Pursuant the lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash

                                       and non-cash proceeds
of the vehicle(s) described above. 
   
 Debtor:                        Bowater Canadain Forest Products Inc. 
                             Bowater Produits Forestiers du
Canada Inc. 
  Secured Party:            GE Vehicle And Equipment Leasing

  File No.:                      
05-0093167-0014 
  Collateral:                    Road Vehicle, CHEVROLET SILVERADO 25, VIN: 1GCHK24U05E249933 
                         
    Pursuant the lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash

                                       and non-cash proceeds
of the vehicle(s) described above. 
    
 Debtor:                        Bowater Canadain Forest Products Inc. 
                             Bowater Produits Forestiers du
Canada Inc. 
  Secured Party:            GE Vehicle And Equipment Leasing

  File No.:                      
05-0111249-0013 
  Collateral:                    Road Vehicle, CHEVROLET COLORADO 4X2, VIN: 1GCDS196758121724 
                         
    Pursuant the lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash

                                       and non-cash proceeds
of the vehicle(s) described above 
    
 Debtor:                        Bowater Canadain Forest Products Inc. 
                             Bowater Produits Forestiers du
Canada Inc. 
                            
Bowater Canadain Forest Products Inc./ Bowater Produits Forestiers du Canada Inc 
                             Bowater Produits Forestiers du
Canada Inc./ Bowater Produits Forestiers du Canada Inc 
  Secured
Party:            GE Vehicle And Equipment Leasing 
  File
No.:                       05-0250488-0006 
  Collateral:                    Road Vehicle, DODGE GRAND CARAVAN, VIN: 1D4GP24R15B317122 
                         
    Pursuant the lease agreement dated DEC.28,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash

                                       and non-cash proceeds
of the vehicle(s) described above. 
    
 Debtor:                        Bowater Canadain Forest Products Inc. 
  

  
                                      Bowater Produits
Forestiers du Canada Inc. 
                             Bowater Canadain Forest
Products Inc./ Bowater Produits Forestiers du Canada Inc 
                             Bowater Produits Forestiers du
Canada Inc./ Bowater Canadain Forest Products Inc 
  Secured
Party:            GE Vehicle And Equipment Leasing 
  File
No.:                      
05-0297534-0008
Collateral:                    Road Vehicle, HONDA ACCORD ,VIN: 1HGCM564X5A810070 
                             Pursuant the
lease agreement dated DEC.12,1994  All attachments, accessories, additions, alterations and replacement parts (whether present or future) to the vehicle(s) described above, together with all cash 
                                        and non-cash
proceeds of the vehicle(s) described above. 
    
 Debtor:                        Bowater Canadain Forest Products Inc. 
                             Bowater Produits Forestiers du
Canada Inc. 
                            
Bowater Canadain Forest Products Inc./ Bowater Produits Forestiers du Canada Inc. 
                             Bowater Produits Forestiers du
Canada Inc./ Bowater Canadain Forest Products Inc. 
  Secured
Party:            GE Vehicle And Equipment Leasing 
  File
No.:                       06-0383611-0001 
 Collateral:                    Pursuant the lease agreement dated DEC.28,1994 
                                      All present and after
acquired motor vehicles, trailers, and goods of whatever make or description, now or hereafter leased by the secured party to the debtor, together with all additions, replacement 
                                      parts, accessions,
attachements and improvements thereto. 
    
 Debtor:                        Bowater Canadian Forest Products Canada Inc. 
  Secured Party:            Xerox Canada Ltd 
  File No.:                       06-0004335-0008 
  Collateral:                    Equipment, Other 
                                       All present and future
office equipment and software supplied or financed from time to time by the secured party (whether by lease, conditional sale or otherwise), whether or not manufactured by the secured 
                                       party or any affiliate
thereof. 
    
 Debtor:                        Bowater CDN Forest Products Inc. 
  Secured Party:            Xerox Canada Ltd 
  File No.:                       05-0004329-0005 
  Collateral:                    Equipment, Other 
                                       All present and future
office equipment and software supplied or financed from time to time by the secured party (whether by lease, conditional sale or otherwise), whether or not manufactured by the secured 
                                        party or any
affiliate thereof. 
  
  Alliance Forest Products Inc.
(former name of Bowater Canadian Forest Products Inc.) 
    
  Register of Personal and Movable Real Rights (Quebec) 
   
 Debtor:                       
Alliance Forest Products Inc. 
  Secured Party:            IBM Canada Limitée
 
  
 
  
  File No.:                       00-0318869-0006 
  Collateral:                     1 - 9406 720 MISE A NIVEAU D'UN 620 - S/N : 102M0FM ET TOUS SES ACCESSOIRES INCLUANT SANS RESTRICTION : 4 X
3004 256MB MAIN STORAGE, 4 X 6813 8.58GB DISK UNIT, 1 X 7128 DASD EXPANSION UNIT, 1 X 1502 (*) CARTE INTERACTIVE, 1 - 3486 BAY - S/N : 88NW920 REFINANCEMENT, 1 - 3570 C01 - S/N : 1350418 REFINANCEMENT, 1 - 9406 620 - S/N : 102M0FM REFINANCEMENT, 1 -
9910 B73 - S/N : 10C9FMK REFINANCEMENT, 1 - PART HWI PCI RAID DISK UNIT CONTROLLER REFINANCEMENT (5089S), 1 - PART HWI 8.58GB DISK UNIT REFINANCEMENT (5090S), 1 - PART HWI 8.58GB DISK UNIT REFINANCEMENT (5092S), 1 - PART HWI 8.58GB DISK UNIT
REFINANCEMENT (5091S), 1 - PART HWI 8.58GB DISK UNIT REFINANCEMENT (5093S) 
    
  Bowater Pulp and Paper Canada Inc.
Bowater Pates et Papiers Canada Inc. ( former name of Bowater Canadian Forest Products
Inc.) 
  
  Register of Personal and Movable Real Rights (Quebec) 
   
 Debtor:                        Bowater Pulp and Paper Canada Inc. 
                                       Bowater Pates et
Papiers Canada Inc. 
  Secured Party:            ASSOCIATES LEASING (CANADA) LTD
 
  File
No.:                       99-0191184-0034 
  Collateral:                    Pursuant to a
vehicle lease agreement dated February 2, 1999, all present and future movable property leased from time to time by the lessor to the lessee, including without limitation all present and future 
                                        motor vehicles
(including without limitation, passenger automobiles, trucks, truck tractors, truck trailers, truck chassis, or truck bodies), automotive equipment (including without limitation, trailers, boxes 
                                        and refrigeration
units) and materials-handling equipment leased from time to time by the lessor to the lessee, together with all present and future attachments, accessions, appurtenances, accessories 
                                        and replacement
parts, and all proceeds of or relating to any of the foregoing. 
    
 Debtor:                        Bowater Pulp and Paper Canada Inc. 

                                     Bowater Pates et
Papiers Canada Inc. 
  Secured Party:            PRAXAIR CANADA INC. 
  File No.:                      
01-0305879-0010 
  Collateral:                    ALL PRESENT AND FUTURE MOVABLE PROPERTY OF ANY NATURE AND WHEREVER LOCATED, INCLUDING WITHOUT LIMITATION ALL
BULK CRYOGENIC STORAGE TANKS USED FOR 
                                       THE STORAGE, FILLING
AND DELIVERY OF INDUSTRIAL AND MEDICAL GASES INCLUDING, WITHOUT LIMITATION; ARGON, CARBON DIOXIDE, NITROGEN, NITROUS OXIDE AND OXYGEN; 
                                       ANY CRYOGENIC FREEZER;
AND ANY AND ALL RELATED EQUIPMENT, ACCESSORIES, PARTS, COMPONENTS AND ATTACHMENTS THEREOF. 
    

   
 Avenor Inc.  (former name of Bowater Canadian Forest Products Inc.)    
   Personal Property Security Act (Ontario
 ) 
     
  Debtor:                        Avenor Inc. 
                                       Bowater Pulp And Paper
Canada Inc. 
       Bowater Pates Et Papiers Canada Inc.
       Bowater Pulp And Paper Canada Inc. Bowater Pates Et Papiers Canada Inc.
       Bowater Pates Et Papiers Canada Inc. Bowater Pulp And Paper Canada Inc.  
  Secured Party:            IBM Canada Limited – Attn. Marny Paget  
  File No.:                       825722478 
  Collateral:                    Equipment, Accounts, Other
                                       
Unspecified 
    
     
   Bowater LaHave Corporation 
     
  Personal Property Security Act (Nova
Scotia ) 
    
   

  Debtor:                        Bowater LaHave Corporation 
  Secured Party:            The Bank of Nova Scotia, as administrative agent 
  File No.:                       11958451 
  
Collateral:                    A SECURITY INTEREST IS TAKEN IN ALL OF THE DEBTOR'S RIGHT, TITLE AND INTEREST IN THE FOLLOWING PROPERTY, NOW OWNED OR
AT ANY TIME HEREAFTER ACQUIRED BY THE DEBTOR OR IN WHICH THE DEBTOR NOW HAS OR AT ANY TIME IN THE FUTURE MAY ACQUIRE ANY RIGHT, TITLE OR INTEREST AND WHEREVER LOCATED OR DEEMED LOCATED: 
  A. ALL ACCOUNTS, INCLUDING FOR GREATER CERTAINTY, ALL DEPOSIT ACCOUNTS; 
  B. ALL INVENTORY; 
  C. ALL INSTRUMENTS IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  D. ALL DOCUMENTS OF TITLE AND CHATTEL PAPER IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  E. ALL MONEY; 
  F. ALL INTANGIBLES; 
  G. ALL BOOKS, INVOICES, DOCUMENTS AND OTHER RECORDS IN ANY FORM EVIDENCING OR RELATING TO ANY OF THE FOREGOING PROPERTY AND ASSETS OF THE DEBTOR; AND
 
  H. ALL PROCEEDS. 
  THE SECURITY INTEREST SHALL NOT EXTEND TO (A) ANY SHARES OF CAPITAL STOCK OF A SUBSIDIARY OR AFFILIATE OF THE DEBTOR OR (B) ANY EQUIPMENT OR ANY FIXED
ASSETS OF THE DEBTOR. 
  FOR THE PURPOSES OF THIS REGISTRATION, THE TERMS "ACCOUNTS", "DEPOSIT ACCOUNTS",
"INVENTORY", "INSTRUMENTS", "DOCUMENTS OF TITLE", "CHATTEL PAPER", "MONEY", "INTANGIBLES", "PROCEEDS", "CAPITAL STOCK", "SUBSIDIARY", "AFFILIATE" OR
"EQUIPMENT" SHALL HAVE THE MEANINGS ATTRIBUTED TO SUCH TERMS IN THAT CERTAIN COLLATERAL AGREEMENT DATED ON OR ABOUT MAY 31, 2006 BY AND AMONG THE DEBTOR AS GRANTOR IN FAVOUR OF THE SECURED PARTY, AS ADMINISTRATIVE AGENT AS THE SAME MAY BE
AMENDED, SUPPLEMENTED, RESTATED OR REPLACED FROM TIME TO TIME. 
    
    
 
  Debtor:                        Bowater LaHave Corporation 
  Secured Party:            The Bank of Nova Scotia 
  File No.:                       14694822 
  Collateral:                    A SECURITY
INTEREST IS TAKEN IN ALL SHARES OF CAPITAL STOCK OR OTHER SECURITIES OF BOWATER KOREA LTD. OR ANY SUCCESSOR THERETO AND ANY OTHER PROPERTY OF THE DEBTOR DELIVERED TO THE SECURED PARTIES FROM TIME TO TIME PURSUANT TO A DEED OF HYPOTHEC TO SECURE
PAYMENT OF DEBENTURES DATED NOVEMBER 24, 2008 MADE BY THE DEBTOR IN FAVOUR OF THE SECURED PARTIES AND PURSUANT TO A PLEDGE AGREEMENT MADE BY THE DEBTOR IN FAVOUR OF THE SECURED PARTIES DATED NOVEMBER 28, 2008, TOGETHER WITH ALL REPLACEMENTS THEREOF,
SUBSTITUTIONS THEREFOR, ACCRETIONS THERETO, INTEREST AND DIVIDENDS THEREON (WHETHER IN CASH, KIND OR STOCK) AND PROCEEDS THEREOF IN ANY FORM INCLUDING GOODS, DOCUMENTS OF TITLE, CHATTEL PAPER, SECURITIES, INSTRUMENTS, MONEY AND INTANGIBLES AND
INCLUDING, WITHOUT LIMITATION, ANY PROCEEDS ARISING OUT OF ANY CONSOLIDATION, SUBDIVISION, RECLASSIFICATION, CONVERSION, STOCK DIVIDEND OR SIMILAR INCREASE OR DECREASE IN OR ALTERATION OF CAPITAL OR ANY OTHER EVENT. 
    
   Bowater Canadian Holdings Incorporated  
      
  Personal Property Security Act (Nova Scotia ) 
    
    
  Debtor:                        Bowater Canadian Holdings Incorporated 
  Secured Party:            The Bank of Nova Scotia, as administrative agent 
  File No.:                       11958410 
  
Collateral:                    A SECURITY INTEREST IS TAKEN IN ALL OF THE DEBTOR'S RIGHT, TITLE AND INTEREST IN THE FOLLOWING PROPERTY, NOW OWNED OR
AT ANY TIME HEREAFTER ACQUIRED BY THE DEBTOR OR IN WHICH THE DEBTOR NOW HAS OR AT ANY TIME IN THE FUTURE MAY ACQUIRE ANY RIGHT, TITLE OR INTEREST AND WHEREVER LOCATED OR DEEMED LOCATED: 
  A. ALL ACCOUNTS, INCLUDING FOR GREATER CERTAINTY, ALL DEPOSIT ACCOUNTS; 
  B. ALL INVENTORY; 
  C. ALL INSTRUMENTS IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
   

   
  D. ALL DOCUMENTS OF TITLE AND CHATTEL PAPER IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  E. ALL MONEY; 
  F. ALL INTANGIBLES; 
  G. ALL BOOKS, INVOICES, DOCUMENTS AND OTHER RECORDS IN ANY FORM EVIDENCING OR RELATING TO ANY OF THE FOREGOING PROPERTY AND ASSETS OF THE DEBTOR; AND
 
  H. ALL PROCEEDS. 
  THE SECURITY INTEREST SHALL NOT EXTEND TO (A) ANY SHARES OF CAPITAL STOCK OF A SUBSIDIARY OR AFFILIATE OF THE DEBTOR OR (B) ANY EQUIPMENT OR ANY FIXED
ASSETS OF THE DEBTOR. 
  FOR THE PURPOSES OF THIS REGISTRATION, THE TERMS "ACCOUNTS", "DEPOSIT ACCOUNTS",
"INVENTORY", "INSTRUMENTS", "DOCUMENTS OF TITLE", "CHATTEL PAPER", "MONEY", "INTANGIBLES", "PROCEEDS", "CAPITAL STOCK", "SUBSIDIARY", "AFFILIATE" OR
"EQUIPMENT" SHALL HAVE THE MEANINGS ATTRIBUTED TO SUCH TERMS IN THAT CERTAIN COLLATERAL AGREEMENT DATED ON OR ABOUT MAY 31, 2006 BY AND AMONG THE DEBTOR AS GRANTOR IN FAVOUR OF THE SECURED PARTY, AS ADMINISTRATIVE AGENT AS THE SAME MAY BE
AMENDED, SUPPLEMENTED, RESTATED OR REPLACED FROM TIME TO TIME. 
    
   Bowater Shelburne Corporation 
      
  Personal Property Security Act (Nova
Scotia ) 
    
   

  Debtor:                        Bowater Shelburne Corporation 
  Secured Party:            The Bank of Nova Scotia, as administrative agent 
  File No.:                       11958436 
  
Collateral:                    A SECURITY INTEREST IS TAKEN IN ALL OF THE DEBTOR'S RIGHT, TITLE AND INTEREST IN THE FOLLOWING PROPERTY, NOW OWNED OR
AT ANY TIME HEREAFTER ACQUIRED BY THE DEBTOR OR IN WHICH THE DEBTOR NOW HAS OR AT ANY TIME IN THE FUTURE MAY ACQUIRE ANY RIGHT, TITLE OR INTEREST AND WHEREVER LOCATED OR DEEMED LOCATED: 
  A. ALL ACCOUNTS, INCLUDING FOR GREATER CERTAINTY, ALL DEPOSIT ACCOUNTS; 
  B. ALL INVENTORY; 
  C. ALL INSTRUMENTS IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  D. ALL DOCUMENTS OF TITLE AND CHATTEL PAPER IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  E. ALL MONEY; 
  F. ALL INTANGIBLES; 
  G. ALL BOOKS, INVOICES, DOCUMENTS AND OTHER RECORDS IN ANY FORM EVIDENCING OR RELATING TO ANY OF THE FOREGOING PROPERTY AND ASSETS OF THE DEBTOR; AND
 
   

   
  H. ALL PROCEEDS. 
  THE SECURITY INTEREST SHALL NOT EXTEND TO (A) ANY SHARES OF CAPITAL STOCK OF A SUBSIDIARY
OR AFFILIATE OF THE DEBTOR OR (B) ANY EQUIPMENT OR ANY FIXED ASSETS OF THE DEBTOR. 
  FOR THE PURPOSES OF THIS REGISTRATION, THE TERMS
"ACCOUNTS", "DEPOSIT ACCOUNTS", "INVENTORY", "INSTRUMENTS", "DOCUMENTS OF TITLE", "CHATTEL PAPER", "MONEY", "INTANGIBLES", "PROCEEDS", "CAPITAL
STOCK", "SUBSIDIARY", "AFFILIATE" OR "EQUIPMENT" SHALL HAVE THE MEANINGS ATTRIBUTED TO SUCH TERMS IN THAT CERTAIN COLLATERAL AGREEMENT DATED ON OR ABOUT MAY 31, 2006 BY AND AMONG THE DEBTOR AS GRANTOR IN FAVOUR OF
THE SECURED PARTY, AS ADMINISTRATIVE AGENT AS THE SAME MAY BE AMENDED, SUPPLEMENTED, RESTATED OR REPLACED FROM TIME TO TIME. 
    
 
   Bowater Canada Finance Limited Partnership  
      
  Personal Property Security Act (New
Brunswick ) 
    
  Debtor:                        Bowater Canada Finance Limited Partnership 
  Secured Party:            The Bank of Nova Scotia, as administrative agent 
  File No.:                       14418206 
  
Collateral:                              A SECURITY INTEREST IS TAKEN IN ALL OF THE DEBTOR'S RIGHT,
TITLE AND INTEREST IN THE FOLLOWING PROPERTY, NOW OWNED OR AT ANY TIME HEREAFTER ACQUIRED BY THE DEBTOR OR IN WHICH THE DEBTOR NOW HAS OR AT ANY TIME IN THE FUTURE MAY ACQUIRE ANY RIGHT, TITLE OR INTEREST AND WHEREVER LOCATED OR DEEMED
LOCATED: 
  A. ALL ACCOUNTS, INCLUDING FOR GREATER CERTAINTY, ALL DEPOSIT ACCOUNTS; 
  B. ALL INVENTORY; 
  C. ALL INSTRUMENTS IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  D. ALL DOCUMENTS OF TITLE AND CHATTEL PAPER IN RESPECT OF THE DEBTOR'S INVENTORY AND ACCOUNTS; 
  E. ALL MONEY; 
  F. ALL INTANGIBLES; 
  G. ALL BOOKS, INVOICES, DOCUMENTS AND OTHER RECORDS IN ANY FORM EVIDENCING OR RELATING TO ANY OF THE FOREGOING PROPERTY AND ASSETS OF THE DEBTOR; AND
 
  H. ALL PROCEEDS. 
  THE SECURITY INTEREST SHALL NOT EXTEND TO (A) ANY SHARES OF CAPITAL STOCK OF A SUBSIDIARY OR AFFILIATE OF THE DEBTOR OR (B) ANY EQUIPMENT OR ANY FIXED
ASSETS OF THE DEBTOR. 
  FOR THE PURPOSES OF THIS REGISTRATION, THE TERMS "ACCOUNTS", "DEPOSIT ACCOUNTS",
"INVENTORY", "INSTRUMENTS", "DOCUMENTS OF TITLE", "CHATTEL PAPER", "MONEY", "INTANGIBLES", "PROCEEDS", "CAPITAL STOCK", "SUBSIDIARY", "AFFILIATE" OR
"EQUIPMENT" SHALL HAVE THE MEANINGS ATTRIBUTED TO SUCH TERMS IN THAT CERTAIN COLLATERAL AGREEMENT DATED ON OR ABOUT MAY 31, 2006 BY AND AMONG THE DEBTOR AS GRANTOR IN FAVOUR OF THE SECURED PARTY, AS ADMINISTRATIVE AGENT AS THE SAME MAY BE
AMENDED, SUPPLEMENTED, RESTATED OR REPLACED FROM TIME TO TIME. 
    
 
      
   Bowater
Belledune Sawmill Inc.  
      
  Personal Property Security Act (New Brunswick ) 
    

 Debtor:                  Bowater Belledune Sawmill Inc.

  
                                054022 NB Ltd.,  
  Jim Bel Inc.,  
  J.E.
Woods & Sons Ltd.,  
  Maltais & Freres Holding Ltee  
  Scieries Chaleur Associes/Chaleur Sawmills Associates 
  Secured Party:       Banque Nationale du Canada/National Bank of Canada 
  File
No.:                  9948578 
  Collateral:               All of the debtor's present and after-acquired personal property, with reference being made to a General Security Agreement dated on or
about July 25, 2003 and a Debenture dated on or about July 25, 2003.   
                                  Serial number collateral is two (2) trailers and
approximately eight (8) motor vehicles.  This registration was amended on October 31, 2003 by financing change statement number 10345262 to amend the  
                                  general collateral description. 
    
   Bowater Maritimes Inc.  
      
  Personal Property Security Act (New Brunswick ) 
   
 
  Debtor:                        Bowater Maritimes Inc. 
  Secured Party:            GMAC Leaseco Corporation 
  File No.:                       13307418 
  Collateral:                     General collateral is described as all proceeds therefrom.  Serial number collateral is a 2006
Chevrolet Silverado motor vehicle.  This registration was discharged on March 20, 2009 by financing change  
                                        statement number
17276726  
    
     
   AbitibiBowater Canada Inc.
 
    
   Register of Personal and Movable Real Rights (Quebec) 
    
  Debtor:                      AbitibiBowater Canada Inc. 
   
                                     Abitibi-Consolidated Company of Canada 
  Secured Party:          IRWIN COMMERCIAL FINANCE CANADA
CORPORATION 
  File
No.:                     08-0059285-0001 
  Collateral:                  1 COMPRESSEUR 175-195CFM DE
MARQUE INGERSOLL-RAND,MODELE P185WJD,SERIE :395081ULRB34., TOGETHER WITH ALL ATTACHMENTS ACCESSORIES ACCESSIONS REPLACEMENTS SUBSTITUTIONS ADDITIONS AND IMPROVEMENTS THERETO AND ALL PROCEEDS IN ANY FORM DERIVED DIRECTLY OR INDIRECTLY FROM ANY SALE
AND OR DEALINGS WITH THE COLLATERAL AND A RIGHT TO AN INSURANCE PAYMENT OR OTHER PAYMENT THAT INDEMNIFIES OR COMPENSATES FOR LOSS OR DAMAGE TO THE COLLATERAL OR PROCEEDS OF THE COLLATERAL. 
    
 
  Debtor:                          AbitibiBowater Canada Inc. 
  Secured Party:            SERVICES FINANCIERS CIT LTÉE 
  File No.:                       08-0606033-0001 
  Collateral:                    LES BIENS CI-APRÈS DÉCRITS PEUVENT ÊTRE SITUÉS AU 3750, DE CHAMPLAIN, JONQUIÈRE
(QUÉBEC) G7S 5J7  DIVISION KENOGAMI, OU À TOUS AUTRES ENDROITS:  1 CISEAU LIFT, NEUF 
 
                                      30-35',
ESS/PROP 4RM, DE MARQUE SKYJACK, ANNÉE 2008, MODÈLE SJ7135RT, N/S: 34001856
    
    
   Bowater Canada Finance Limited Partnership  
   Bowater Canadian Holdings Incorporated  
  Bowater Lahave
Corporation 
  Bowater Shelburne Corporation 
  
  Register of Personal and Movable Real Rights (Quebec) 
    
  Debtor:                     Bowater Canada Finance limited Partnership
 
  
                                   Bowater Canadian Holdings
Incorporated 
  
                                   Bowater Lahave Corporation 
  
                                   Bowater Shelburne Corporation 
  Secured Party:         The Bank of Nova Scotia 
  File No.:                    08-0674019-0003 
  Collateral:                 Each Grantor hypothecates the following property (the "Hypothecated Property"): 
 1.1  all present and future
Inventory (wherever located) and Receivables (wherever the debtor of same may be located); 
 1.2  the proceeds of any sale, lease or other disposition or of the collection of the property described in Section 1.1 and any debt resulting from
such sale, lease or other disposition, and all proceeds of insurance covering the said property; and 
 1.3  all present and future books, records, registers (including those in a computerized form) and documents of the Grantor evidencing or
accessory to the property described in Sections 1.1 and 1.2; 
 provided that (i) the Hypothecated Property shall in no event include any shares of Capital Stock of a Subsidiary or Affiliate (as each such term is defined in the Credit Agreement)
of any Grantor, (ii) the Hypothecated Property shall in no event include any equipment or any fixed assets of any Grantor, and (iii) the hypothec granted herein shall not extend to, and the term "Hypothecated Property" shall not include,
any rights under any lease, contract or agreement to the extent that the granting of a hypothec thereon is specifically prohibited in writing by, or would constitute an event of default under or grant a party a termination right under any agreement
governing such right unless such prohibition is not enforceable or is otherwise ineffective under applicable law. Notwithstanding anything in clause (iii) above to the contrary, such proviso shall not affect, limit, restrict or impair the grant by
each Grantor of a hypothec on any Receivable due and payable to such Grantor or to become due and payable to such Grantor under such lease, contract or agreement, unless such hypothec on such Receivable is also specifically prohibited by the terms
of such lease, contract or agreement or such hypothec on such Receivable would expressly constitute an event of default under or would expressly grant a party a termination right under any such lease contract or agreement, in each case unless such
prohibition is not enforceable or is otherwise ineffective under applicable law;  provided further that notwithstanding anything to the contrary contained in the foregoing proviso, the hypothec granted herein shall immediately extend to and the
term "Hypothecated Property" shall immediately include the rights under any such lease, contract or agreement and in such Receivable at such time as such prohibition, event of default or termination right shall terminate or shall be
waived. 
 
  

      
  Bowater Lahave
Corporation 
    
  Register of Personal and Movable
Real Rights (Quebec) 
    
  Debtor:                         Bowater Lahave Corporation 
  Secured Party:             The Bank of Nova Scotia 
  File No.:                        08-0674019-0002 

  Collateral:                     1.1  all of BOWATER LAHAVE CORPORATION's (the "Grantor") present and future shares of the
common stock of Bowater-Korea Co., Ltd; 
 1.2  all proceeds of and all other profits, income or receipts, in whatever form and whatever currency, arising from the ownership, collection, sale, exchange, assignment or other disposition of, or
realisation of the Hypothecated Shares, and all interest, dividends and other payments and distributions on or with respect to such Hypothecated Shares or in exchange for such Hypothecated Shares; and 
 1.3  all present and future
certificates, instruments, records, registers (including those in a computerized form) and documents of the Grantor evidencing or accessory to the property described in Sections 1.1 and 1.2. 
    
    
  
  
 

 
 
       Schedule
5.02(b) 
    
   Prepetition Indebtedness 
    

	   Obligors 
	
   Debt 
	
   Approximate Amount outstanding as of 12/31/08 (U.S. $) 

	  AbitibiBowater Inc. (Issuer) 
  Bowater Incorporated (Guarantor) 
	  $350 million 8% senior unsecured convertible notes due April 15, 2013 
	  $369 million 

	  Bowater Incorporated (Borrower) 
  Bowater Newsprint South LLC (Borrower) 
  Bowater Newsprint South Operations LLC (Borrower) 
  Bowater Alabama LLC (Borrower) 
 
AbitibiBowater Inc. (Guarantor) 
  Bowater America Inc. (Guarantor) 
  Bowater Nuway Inc.
(Guarantor) 
  Bowater Nuway Mid-States Inc. (Guarantor) 
    
	  Credit Agreement dated as of May 31, 2006 ( as amended ) by and among Bowater Incorporated, Bowater Newsprint South LLC, Bowater Alabama LLC and Bowater Newsprint South Operations LLC, as
borrowers, the lenders party thereto and Wachovia Bank, National Association, Administrative Agent 
	  $280 million 

	  Bowater Canadian Forest Products Inc. (Borrower) 
  Bowater Incorporated (Guarantor) 
  Bowater Newsprint South LLC (Guarantor) 
  Bowater Newsprint South Operations LLC (Guarantor) 
  Bowater Alabama LLC (Guarantor) 
  Bowater Canadian Holdings Incorporated (Guarantor) 
 
Bowater Canada Finance Limited Partnership (Guarantor) 
  Bowater Shelburne Corporation (Guarantor) 
  Bowater LaHave Corporation (Guarantor) 
    
	  Credit Agreement dated as of May 31, 2006 ( as amended ) by and among Bowater Canadian Forest Products Inc., as borrower, the guarantors party thereto, the lenders party thereto, and The Bank
of Nova Scotia, as Administrative Agent 
	  $50 million 

    
   
   

   
   
   

	   Obligors 
	
   Debt 
	
   Approximate Amount outstanding as of 12/31/08 (U.S. $) 

	  Bowater Incorporated (Issuer) 
	  9.0% notes due 2009 in the aggregate principal amount of $300 million  
	  $248 million 

	  Bowater Incorporated (Issuer) 
	  Floating Rate notes due 2010 (as amended) in the aggregate principal amount of $250 million  
	  $234 million 

	  Bowater Incorporated (Issuer) 
	  9.50% notes due 2012 in the aggregate principal amount of $125 million 
	  $125 million 

	  Bowater Incorporated (Issuer) 
	  6.5% notes due 2013 in the aggregate principal amount of $400 million 
	  $400 million 

   
   
   

   
   

	   Obligors 
	
   Debt 
	
   Approximate Amount outstanding as of 12/31/08 (U.S. $) 

	  Bowater Incorporated (Issuer) 
	  9.375% notes due 2021 in the aggregate principal amount of $200 million 
	  $200 million 

	  Bowater Incorporated (Issuer) 
	  (1991A) 7.4% Pollution Control Revenue Bonds due 2010 in the aggregate principal amount of $6.5 million  
	  $3.9 million 

	  Bowater Incorporated (Issuer) 
	  7.625% Recycling Facilities Revenue Bonds due 2016 in the aggregate principal amount of $30 million 
	  $30 million 

	  Bowater Incorporated (Issuer) 
	  7.75% Recycling Facilities Revenue Bonds due 2022 in the aggregate principal amount of $62 million 
	  $62 million 

	  Bowater Incorporated (Issuer) 
	  7.40% Recycling Facilities Revenue Bonds due 2022 in the aggregate principal amount of $40 million 
	  $39.4 million 

	  Bowater Incorporated (Issuer) 
	  Floating Rate Industrial Revenue Bonds due 2029 in the aggregate principal amount of $34 million 
	  $33.5 million 

	  Bowater Newsprint South Operations LLC 
	  6.5% UDAG promissory note due February 1, 2010 in an aggregate principal amount of $8.5 million  
	  $4.9 million 

	  Bowater Canada Finance Corporation (Issuer) 
    
  Bowater Incorporated (Guarantor) 
	  7.95% notes due 2011 in the aggregate principal amount of $600 million 
	  $600 million 

	  Bowater Canadian Forest Products Inc. 
	  10.63% senior notes (Series A) due 2010 in the aggregate principal amount of $98 million  
	  $2.7 million 

   
   

   
   

	   Obligors 
	
   Debt 
	
   Approximate Amount outstanding as of 12/31/08 (U.S. $) 

	  Bowater Canadian Forest Products Inc. 
	  10.50% senior notes (Series B) due 2010 in the aggregate principal amount of 102 million  
	  $20.4 million 

	  Bowater Canadian Forest Products Inc. 
	  10.60% senior notes (Series C) due 2011 in the aggregate principal amount of $70 million  
	  $70 million 

	  Bowater Canadian Forest Products Inc. 
	  10.26% senior notes (Series D) due 2011 in the aggregate principal amount of $22 million  
	  $6.6 million 

	  Bowater Canadian Forest Products Inc. 
	  10.85% debentures due 2014 in the aggregate principal amount of CDN$125 million  
	  $102.4 million 

	  Bowater Incorporated 
	  Make-Whole Guaranty of Notes made by Bowater Saluda Note Holdings LLC 
	  Make-whole amount under such notes 

	  Bowater Incorporated 
	  Guaranty of obligations of Timber Note Holding, LLC under note monetization 
	  Loan obligations have been paid in full 

   
   
   
  Letters of Credit  :   
    

	  Issuing Bank 	
  Beneficiary 	
  Approximate Amount 	
  L/C Number  	
  Date of Issue 	
  Expiration Date 
	 Wachovia 
	
First Citizens as Trustee 
	
 $34,761,834 
	
 SM202916 
	  6/2/2003 
	  6/2/2009 

	 Wachovia 
	
Washington Insurance Co. 
	
 $3,500,000 
	
 SM222084W 
	  9/25/2006 
	  9/25/2009 

	 Wachovia 
	
Tennessee Valley Authority 
	
 $750,000 
	
 SM228334W 
	  10/19/2007 
	  10/17/2009 

	 Wachovia 
	
Tennessee Valley Authority 
	
 $1,600,000 
	
 SM21138W 
	  5/5/2008 
	  4/30/2009 

	 Wachovia 
	
ExxonMobil 
	
 $300,000 
	
 SM231041W 
	  5/2/2008 
	  4/30/2009 

	 Wachovia 
	
State of Maine 
	
 $12,968,500 
	
 SM221950W 
	  10/3/2006 
	  9/20/2009 

	 Carolina First 
	
Liberty 
	
 $1,111,200 
	
 S100019 
	  10/20/2006 
	  10/20/2009 

    
    
 
  
  

	  Issuing Bank 	
  Beneficiary 	
  Approximate Amount 	
  L/C Number  	
  Date of Issue 	
  Expiration Date 

	 Carolina First 
	
State of Alabama 
	
 $836,905 
	
 03-649 
	  4/23/2003 
	  4/20/2009 

	 Carolina First 
	
State of Tennessee  
	
 $4,545,083 
	
 03-648 
	  4/23/2003 
	  5/1/2009 

	 Carolina First 
	
Travelers 
	
 $8,150,000 
	
 06-01275 
	  7/11/2006 
	  7/10/2009 

	 The Bank of Nova Scotia 
	
Royal Trust as Trustee 
	
 C$23,065,000 
	
 G18572/254432 
	  4/1/2004 
	  3/31/2009 

	 The Bank of Nova Scotia 
	
Royal Trust as Trustee 
	
 C$615,000 
	
 S18572/231694 
	  10/19/2005 
	  5/31/2009 

	 The Bank of Nova Scotia 
	
IESO 
	
 C$8,504,945 
	
 S18572/174752 
	  4/19/2002 
	  4/16/2009 

	 The Bank of Nova Scotia 
	
Trans Canada Pipeline 
	
 C$50,000 
	
 S18572/2211592 
	  3/9/2005 
	  3/9/2009 

	 The Bank of Nova Scotia 
	
Hydro Québec 
	
 C$644,228 
	
 S51151/238041 
	  4/1/2006 
	  4/1/2009 

	 The Bank of Nova Scotia 
	
Imperial Oil 
	
 C$500,000 (as of January 21, 2009) 
	
 S51151/283567 
	  1/21/2009 
	  12/31/2009 

	 The Bank of Nova Scotia 
	
Al Ahram - Egypt 
	
 $53,402 
	
 G18572/272246 
	  4/14/2008 
	  1/15/2009 

	 The Bank of Nova Scotia 
	
Al Ahram - Egypt 
	
 $57,038 
	
 G18572/273269 
	  5/5/2008 
	  1/30/2009 

	 The Bank of Nova Scotia 
	
Akhbar El-Youm 
	
 $72,300 
	
 G18572/281555 
	  11/19/2008 
	  4/2/2009 

	 The Bank of Nova Scotia 
	
Amex Bank of Canada 
	
 $700,000 
	
 S51151/282571 
	  12/19/2008 
	  12/17/2009 

  
  
  Intercompany Indebtedness  :  
    

	   Obligors 
	
   Indebtedness 

	  AbitibiBowater Inc. (Maker) 
  Bowater Newsprint South LLC (Guarantor) 
  Bowater Newsprint South Operations LLC (Guarantor) 
  Bowater Alabama LLC (Guarantor)
 
	  Term Promissory Note dated as of May 12, 2008 made by AbitibiBowater Inc. to the order of Bowater Incorporated in an original principal amount of $650,000,000 

   
  
  

	   Obligors 
	
   Indebtedness 

	  Bowater Canadian Forest Products Inc. 
	  Indebtedness owing to Bowater Incorporated in an aggregate amount of $459,147,426.28 as of March 31, 2009 

	  Bowater Canadian Forest Products Inc. 
	  Note made by Bowater Canadian Forest Products Inc. to Bowater Canadian Holdings Inc. with a principal balance of $26,084,896 as of December 31, 2008 

	  Bowater Canadian Forest Products Inc. 
	  Note made by Bowater Canadian Forest Products Inc. to Bowater Pulp and Paper Canada Holdings Limited Partnership with a principal balance of $323,406,851 as of December 31,
2008 

	  Bowater Canadian Holdings Inc. 
	  Note made by Bowater Canadian Holdings Inc. to Bowater Pulp and Paper Canada Holdings Limited Partnership with an original principal balance of $82,000,000 

	  Bowater Canadian Forest Products Inc. 
	  Note made by Bowater Canadian Forest Products Inc. to AbitibiBowater Canada Inc. with an original principal balance of $270,000,000 

	  AbitibiBowater Canada Inc. 
	  Note made by AbitibiBowater Canada Inc. to Bowater Canadian Forest Products Inc. with an original principal balance of $59,000,000 

	  Bowater Canada Finance Limited Partnership 
	  Debt of Bowater Canada Finance Limited Partnership owed to Bowater Canada Treasury Corporation in an amount of $2,750,000 as of January 19, 2007 

	  AbitibiBowater Inc. 
	  Debt of AbitibiBowater Inc. owed to Abitibi-Consolidated Company of Canada in the amount of $12,400,000 for G&A allocations as of December 31, 2008 

	  Bowater Incorporated 
	  Debt of Bowater Incorporated owed to AbitibiBowater Inc. in the amount of $13,200,000 for G&A allocations as of December 31, 2008 

	  Bowater Incorporated 
	  Debt of Bowater Incorporated owed to Donohue Corp. and Subsidiaries in an amount of $24M for NOL utilization as of December 31, 2008 

  

  

	   Obligors 
	
   Indebtedness 

	  Bowater Korea Ltd. 
	  Note made by Bowater Korea Ltd. to Bowater Canadian Holdings Inc. with an aggregate principal balance of $22,000,000 

	  Calhoun Newsprint Company 
	  The $50,000,000 Grid Notes made by Calhoun Newsprint Company in favor of Bowater Incorporated 

	  Calhoun Newsprint Company 
	  The $6,375,000 Note made by Calhoun Newsprint Company in favor of Bowater Incorporated 

	  Calhoun Newsprint Company 
	  The $6,125,000 Note made by Calhoun Newsprint Company in favor of The Herald Company, Inc. or its successor or assign 

  

   
    
   
   Schedule 5.02(h) 
 
  
   Investments 
    
  See investments consisting of intercompany Indebtedness listed on Schedule 5.02(b) and all other intercompany Indebtedness
 
    
  Investments
consisting of ordinary course, arm's length intercompany accounts between and among AbitibiBowater Inc. and its Subsidiaries and affiliates 
    
  Investments held by Bowater Incorporated in a securities account with Bank of New York (account No. 333002) 
    
  Investments consisting of equity
interests in Subsidiaries and joint ventures 
    
  Investments by Bowater Incorporated consisting of the $50,000,000 Grid Notes between Bowater Incorporated and Calhoun Newsprint Company 
    
  Investments by Bowater Canadian Forest Products Inc.
consisting of the $58,900,000 Note made by AbitibiBowater Canada Inc. to Bowater Canadian Forest Products Inc. 
    
  Investments by Bowater Canadian Forest Products Inc. consisting of the $270,000,000 Note made by AbitibiBowater Canada Inc. to Bowater Canadian Forest
Products Inc.  
    
  Investments by Bowater Canadian Holdings Incorporated consisting of the Note made by Bowater Canadian Holdings Incorporated to Bowater Korea Ltd. with an approximate principal balance of $22,000,000 
    
  Investments by Bowater Canadian Holdings Incorporated
consisting of the $82,000,000 Note made by Bowater Canadian Holdings Incorporated to Bowater Pulp and Paper Canadian Holdings Limited Partnership 
    
    
   

  
    
   
   Schedule 5.02(n) 
    
   Sale
and Leasebacks 
    
  Bowater
Incorporated's lease and lease-back arrangement with the Industrial Development Board of the City of Albertville relating to the Albertville sawmill.   
    
  Bowater Alabama LLC's lease and lease-back arrangement with the Industrial Development Board of the City of Childersburg relating to the Coosa
Pines mill.   
   
      
     

 
 
  
     
EXHIBIT A   
     
  FORM OF

ASSIGNMENT AND ACCEPTANCE  
     
  Reference is made to the Senior
Secured Superpriority Debtor-In-Possession Credit Agreement, dated as of April 21, 2009, (as amended, amended and restated, supplemented or otherwise modified from time to time, the "Credit Agreement"; the terms defined therein, unless
otherwise defined herein, being used herein as therein defined) among by and among AbitibiBowater Inc., Bowater Incorporated, Bowater Canadian Forest Products Inc. ("BCFP" and, together with AbitibiBowater Inc. and Bowater
Incorporated, collectively, the "Borrowers"), the Guarantors party thereto, each a debtor and debtor-in-possession under Chapter 11 of the Bankruptcy Code and, in the case of BCFP, as a debtor company under the CCAA, Fairfax Financial
Holdings Ltd., as Administrative Agent, Collateral Agent and Initial Lender, Avenue Investments, L.P. as Initial Lender and the other Lenders from time to time party thereto.  
  
  Each "Assignor" referred to on Schedule 1 hereto (each, an "Assignor") and each "Assignee" referred to on
Schedule 1 hereto (each, an "Assignee") agrees severally with respect to all information relating to it and its assignment hereunder and on Schedule 1 hereto as follows:  
  
   (1)               Such Assignor
hereby sells and assigns, without recourse except as to the representations and warranties made by it herein, to such Assignee, and such Assignee hereby purchases and assumes from such Assignor, an interest in and to such Assignor's rights and
obligations under the Credit Agreement as of the date hereof equal to the percentage interest specified on Schedule 1 hereto.  After giving effect to such sale and assignment, such Assignee's Commitments and the amount of the Advances owing to
such Assignee will be as set forth on Schedule 1 hereto.  
  
 
 (2)               Such Assignor (i) represents and warrants that its name set forth on Schedule 1 hereto is its legal name, that it is the legal and beneficial owner of
the interest or interests being assigned by it hereunder and that such interest or interests are free and clear of any adverse claim; (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties
or representations made in or in connection with any Loan Document or the execution, legality, validity, enforceability, genuineness, sufficiency or value of, or the perfection or priority of any lien or security interest created or purported to be
created under or in connection with, any Loan Document or any other instrument or document furnished pursuant thereto; and (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of any Credit
Party or the performance or observance by any Credit Party of any of its obligations under any Loan Document or any other instrument or document furnished pursuant thereto.  
  
   (3)
              Such Assignee (i) confirms that it has received a copy of the Credit Agreement, together with copies of the financial statements referred to in Section 5.03 thereof and
such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (ii) agrees that it will, independently and without reliance upon the Administrative Agent,
any Assignor or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iii) represents and warrants
that its name set forth on Schedule 1 hereto is its legal name; (iv) confirms that it is an Eligible Assignee; (v) appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion
under the Loan Documents as are delegated to the Administrative Agent by the terms thereof, together with such powers and discretion as are reasonably incidental thereto; (vi) agrees that it will perform in accordance with their terms all of the
obligations that by the terms of the Credit Agreement are required to be performed by it as a Lender; and (vii) attaches any U.S. Internal Revenue Service forms required under Section 2.14 of the Credit Agreement.  
  
 
  
   (4)               Following the execution of this Assignment and Acceptance, it will be delivered to the
Administrative Agent for acceptance and recording by the Administrative Agent.  The effective date for this Assignment and Acceptance (the "Effective Date") shall be the date of acceptance hereof by the Administrative Agent,
unless otherwise specified on Schedule 1 hereto.  
  
   (5)               Upon such acceptance and recording by the Administrative Agent, as of the Effective Date, (i) such Assignee shall be a party to the Credit Agreement and, to
the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and (ii) such Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement (other than its rights and obligations under the Loan Documents that are specified under the terms of such Loan Documents to survive the payment in full of the Obligations of the Credit Parties under the Loan
Documents to the extent any claim thereunder relates to an event arising prior to the Effective Date of this Assignment and Acceptance) and, if this Assignment and Acceptance covers all of the remaining portion of the rights and obligations of such
Assignor under the Credit Agreement, such Assignor shall cease to be a party thereto.  
  
   (6)               Upon such acceptance and recording by the Administrative Agent, from and after the
Effective Date, the Administrative Agent shall make all payments under the Credit Agreement and the other Loan Documents in respect of the interest assigned hereby (including, without limitation, all payments of principal, interest and commitment
fees with respect thereto) to such Assignee.  Such Assignor and such Assignee shall make all appropriate adjustments in payments under the Credit Agreement and the other Loan Documents for periods prior to the Effective Date directly between
themselves.  
  
   (7)
              This Assignment and Acceptance shall be governed by, and construed in accordance with, the laws of the State of New York and, to the extent applicable, the Bankruptcy
Code.  
  
   (8)
              This Assignment and Acceptance may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  Delivery of an executed counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall be effective as delivery of
an original executed counterpart of this Assignment and Acceptance.  
  
  IN WITNESS WHEREOF, each Assignor and each Assignee have caused Schedule 1 to this Assignment and Acceptance to be executed by their officers thereunto duly authorized as of the date specified thereon.  
   
    
   
  SCHEDULE 1
 TO
 ASSIGNMENT AND ACCEPTANCE  
   

	 
ASSIGNORS:  
	
     
	
     
	
     
	
     
	
     

	
  Percentage interest assigned  
	
  %  
	
  %  
	
  %  
	
  %  
	
  %  

	
  Commitment assigned  
	
  $  
	
  $  
	
  $  
	
  $  
	
  $  

	
  Outstanding principal amount of 
 Advance assigned  
	
  $  
	
  $  
	
  $  
	
  $  
	
  $  

     
  
 
  
     

	   ASSIGNEES:  
	
     
	
     
	
     
	
     
	
     

	
  Percentage interest assumed  
	
  %  
	
  %  
	
  %  
	
  %  
	
  %  

	
  Commitment assumed  
	
  $  
	
  $  
	
  $  
	
  $  
	
  $  

	
  Outstanding principal amount of 
 Advance assumed  
	
  $  
	
  $  
	
  $  
	
  $  
	
  $  

     
  
    
  
  Effective Date (if other than date of acceptance by Administrative Agent):  
  
  1 __________, 200_  
                                         
                                         
                                         
                                         
     Assignors  
                                          
                                         
                                         
                                         
                         __________, as Assignor  
 
                                        
                                         
                                         
                                         
                         [Type or print legal name of Assignor]  
     
                                          
                                         
                                         
                                         
                         By  ______________________________

                                         
                                         
                                         
                                         
                        Title:  
   
 
                                          
                                         
                                         
                                         
                         Dated:  __________, 200_  
     
                                          
                                         
                                         
                                         
                         __________, as Assignor  
 
                                        
                                         
                                         
                                         
                         [Type or print legal name of Assignor]  
     
                                          
                                         
                                         
                                         
                         By  ______________________________

                                         
                                         
                                         
                                         
                        Title:  
   
 
                                          
                                         
                                         
                                         
                         Dated:  __________, 200_  
     
                                          
                                         
                                         
                                         
                         __________, as Assignor  
 
                                        
                                         
                                         
                                         
                         [Type or print legal name of Assignor]  
     
                                          
                                         
                                         
                                         
                         By  ______________________________

                                         
                                         
                                         
                                         
                        Title:  
   
 
                                          
                                         
                                         
                                         
                         Dated:  __________, 200_  
     
     
                                          
                                         
                               
  1  This date should be no earlier than five Business Days after the delivery of this Assignment and Acceptance to the Administrative Agent.  
     
 
     
    

                                         
                                         
                                         
                                         
      Assignees                                            
                                         
                                         
                                         
                         ___________, as Assignee  
 
                                        
                                         
                                         
                                         
                         [Type or print legal name of Assignee]  
     
                                          
                                         
                                         
                                         
                         By  ______________________________

                                         
                                         
                                         
                                         
                        Title:  
   
 
                                          
                                         
                                         
                                         
                         Dated:  __________, 200_  
                                          
                                         
                                         
                                         
                         Lending Office:  
     
                                          
                                         
                                         
                                         
                         __________, as Assignee  
 
                                        
                                         
                                         
                                         
                         [Type or print legal name of Assignee]  
     
                                          
                                         
                                         
                                         
                         By  ______________________________

                                         
                                         
                                         
                                         
                        Title:  
   
 
                                          
                                         
                                         
                                         
                         Dated:  __________, 200_  
                                          
                                         
                                         
                                         
                         Lending Office:  
     
  
    
  
  
  Accepted [and Approved] this ____
 day of __________, 200_  
  
  2FAIRFAX FINANCIAL
HOLDINGS LTD.
 as Administrative Agent  
  By ______________________________
 Title:  
  [Approved this ____ day
 of __________, 200_  
  
  3[ABITIBIBOWATER
INC.  
     
  By:______________________________  
  Title:  
  Name:  
     
  BOWATER INCORPORATED  
 
   
  By:______________________________  
  Title:  
  Name:  
     
  BOWATER CANADIAN FOREST PRODUCTS INC.  
     
  By:______________________________  
  Title:  
  Name:]  
     
                                           
                                         
                               
 
 2 Required if the Assignee is an Eligible Assignee solely by reason of clause (a)(iv) of the definition of "Eligible Assignee."  

   3  Required if consent is required under the Credit Agreement.  

   
    
 
  EXHIBIT B 
  FORM OF
NOTICE OF BORROWING

 Fairfax Financial Holdings Ltd.
as Administrative Agent
under the Credit Agreement
referred to below 
  
 [Address] 
 Fax: [ 
]                        
   

                                        
                                         
[Date] 
                          Attention:  __________ 
   
 Ladies and Gentlemen: 
  
                         The undersigned ____________, a ____________ [corporation][limited liability company] and a debtor
and debtor-in-possession under Chapter 11 of the Bankruptcy Code, refers to the Senior Secured Superpriority Debtor-In-Possession Credit Agreement dated as of April 21, 2009 (as amended, amended and restated, supplemented or otherwise modified from
time to time, the "Credit Agreement"; the terms defined therein being used herein as therein defined), among AbitibiBowater Inc., Bowater Incorporated, Bowater Canadian Forest Products Inc., each as a debtor, debtor-in-possession and
borrower, the Guarantors party thereto, each a debtor and debtor-in-possession under Chapter 11 of the Bankruptcy Code, Fairfax Financial Holdings Ltd., as Administrative Agent, Collateral Agent and an Initial Lender, Avenue Investments, L.P. as an
Initial Lender and certain other lenders from time to time party thereto, and hereby gives you notice, irrevocably, that the undersigned hereby requests a Borrowing under the Credit Agreement, and in that connection sets forth below the information
relating to such Borrowing (the "Proposed Borrowing") as required by the Credit Agreement: 
  
(i)
                 The Business Day of the Proposed Borrowing is __________, 200_.   
(ii)
                The Type of Advance comprising the Proposed Borrowing is a [Term Advance] [Incremental Facility Advance].   
(iii)                The aggregate amount of the Proposed Borrowing is $__________.   
(iv)               [The initial Interest Period for each LIBOR Advance made as part of the Proposed Borrowing is ____
month[s].]   
 The undersigned, solely on behalf of the Borrower and not in any individual capacity, hereby
certifies that the following statements are true on the date hereof, and will be true on the date of the Proposed Borrowing: 
  
 (A)                The representations and warranties contained in each Loan Document, are correct in all material
respects on and as of the date of the Proposed Borrowing, before and after giving effect to such Proposed Borrowing and to the application of the proceeds therefrom, as though made on and as of such date, other than any such representations or
warranties that, by their terms, refer to a specific date other than the date of such Proposed Borrowing, in which case as of such specific date. 
  
  

  
  
  
 (B)                  No event has
occurred and is continuing, or would result from such Proposed Borrowing or from the application of the proceeds therefrom, that constitutes an Event of Default. 
  
         Delivery of an
executed counterpart of this Notice of Borrowing by telecopier shall be effective as delivery of an original executed counterpart of this Notice of Borrowing. 
  
                                         
                                         
                               Very truly yours, 
  
   
  [ABITIBIBOWATER INC.] 
  [BOWATER INCORPORATED] 
  [BOWATER CANADIAN FOREST PRODUCTS INC.] , 
  a debtor and debtor-in-possession 
   
   
                                         
                                         
                               By  
______________________________
                                    
                                         
                                         
 
Name:
                                        
                                         
                                       Title: 
    

    EXHIBIT C 
 
  INTERIM ORDER  
    [DISTRIBUTED UNDER
SEPARATE COVER] 
   
 
   
IN THE UNITED STATES BANKRUPTCY COURT
 FOR THE DISTRICT OF DELAWARE 
    

	    
  In re: 
    
  ABITIBIBOWATER INC., et al.,1 
    
                                          
        Debtors. 
	  ) 
  ) 
  ) 
  ) 
  ) 
  ) 
  ) 
	    
  Chapter 11 
    
 
Case No. 09-11296(KJC) 
    
  (Joint Administration Pending) 

    
   
  INTERIM ORDER PURSUANT TO 11
U.S.C. §§ 105, 361, 362, 363, 364 AND 507  
  (1) APPROVING POSTPETITION FINANCING,
(2) Authorizing Use of cash  
  collateral, (3) GRANTING LIENS AND PROVIDING SUPERPRIORITY 

  ADMINISTRATIVE EXPENSE STATUS, (4) GRANTING ADEQUATE PROTECTION,  
   (5) MODIFYING The AUTOMATIC
STAY, and (6) SCHEDULING A FINAL HEARING 
 
  
 THIS MATTER having come before the Court upon the motion (the "DIP
Motion") by AbitibiBowater Inc. ("Parent"), Bowater Incorporated ("Bowater", together with Parent, collectively, the "US Borrowers"), Bowater Newsprint South LLC and all the direct and indirect domestic
subsidiaries of Bowater and Bowater Newsprint South LLC, in each case as a debtor-in-possession in the above-captioned chapter 11 cases (the "Cases") as guarantors of the   
  
 
                                        
                                    
 1    The debtors-in-possession in these cases, along with the last four digits of each Debtor's federal or Canadian tax identification number, are:  AbitibiBowater Inc. (6415), AbitibiBowater US Holding 1
Corp. (6050), AbitibiBowater US Holding LLC (N/A), AbitibiBowater Canada Inc. (3225), Abitibi-Consolidated Alabama Corporation (4396), Abitibi-Consolidated Corporation (9050), Abitibi-Consolidated Finance LP (4528), Abitibi Consolidated Sales
Corporation (7144), Alabama River Newsprint Company (7247), Augusta Woodlands, LLC (0999), Bowater Alabama LLC (7106), Bowater America Inc. (8645), Bowater Canada Finance Corporation (8810), Bowater Canadian Forest Products Inc. (2010), Bowater
Canadian Holdings Incorporated (6828), Bowater Canadian Limited (7373), Bowater Finance Company Inc. (1715), Bowater Finance II LLC (7886), Bowater Incorporated (1803), Bowater LaHave Corporation (5722), Bowater Maritimes Inc. (5684), Bowater
Newsprint South LLC (1947), Bowater Newsprint South Operations LLC (0186), Bowater Nuway Inc. (8073), Bowater Nuway Mid-States Inc. (8290), Bowater South American Holdings Incorporated (N/A), Bowater Ventures Inc. (8343), Catawba Property Holdings,
LLC (N/A), Coosa Pines Golf Club Holdings LLC (8702), Donohue Corp. (9051), Lake Superior Forest Products Inc. (9305) and Tenex Data Inc. (5913).  The corporate headquarters of the debtors-in-possession is located at, and the mailing address
for each debtor-in-possession is, 1155 Metcalfe Street, Suite 800, Montreal, Quebec H3B 5H2, Canada.       
 
  
  
  
 obligations of the US Borrowers (together with any domestic subsidiaries of Bowater that subsequently commence jointly administered chapter 11 cases and become
guarantors of the obligations of the US Borrowers and Bowater Canada, collectively, the "US Guarantors" and together with the US Borrowers, collectively, the "US Debtors"), and Bowater Canadian Forest Products Inc., as a borrower
("Bowater Canada") under the DIP Loan Agreement (as defined herein), and the direct and indirect Canadian subsidiaries of Bowater that are debtors-in-possession in the Cases and guarantors of the obligations of Bowater Canada (together with
any Canadian subsidiaries of Bowater that subsequently commence jointly administered chapter 11 cases and become guarantors of the obligations of Bowater Canada, collectively, the "Canadian Guarantors", together with Bowater Canada,
collectively the "Canadian Debtors" and together with the US Debtors, collectively the "Bowater Debtors),2 seeking entry of an order (this "Order") authorizing the Bowater Debtors to:     
   (a)  
            
  Obtain credit and incur debt, pursuant to sections 363, 364(c) and 364(d)(1) of chapter 11 of title 11 of the United States Code (the "Bankruptcy Code"):           
                                 
  
 (i)         on an interim basis for a period (the "Interim Period") from the Closing Date3  through and including the earlier of entry of a Final Order, as defined below, or June 1, 2009 (as such date may be extended from time-to-time among the Bowater Debtors and the DIP Lenders, as defined herein),  up to
an aggregate principal amount of US$206,000,000 (consisting   
  
  
 
                                        
                                    
  2     For the avoidance of doubt, the reference to Bowater Debtors herein does not include AbitibiBowater US Holding 1 Corp.,
AbitibiBowater US Holding LLC, AbitibiBowater Canada Inc., Abitibi-Consolidated Alabama Corporation, Abitibi-Consolidated Corporation, Abitibi-Consolidated Finance LP, Abitibi Consolidated Sales Corporation, Alabama River Newsprint Company, Augusta
Woodlands, LLC, Donohue Corp. or Tenex Data Inc. (5913). 
  
 
3     Capitalized terms used herein but not otherwise defined shall have the meaning set forth in the DIP Loan Agreement. 
  
  2
 
  
  
 of a US$166,000,000 term loan for borrowings of the US Borrowers and a
US$40,000,000 term loan for borrowings of Bowater Canada), with all borrowings of the US Borrowers guaranteed by the US Guarantors and all borrowings by Bowater Canada guaranteed by all of the other Bowater Debtors; and  
 (ii)        upon entry of a final order approving the relief requested in the DIP Motion (the "Final Order"), in the form of an
asset-backed revolving credit facility in an amount not to exceed $600,000,000 minus the outstanding principal amount of the DIP Facility, as defined below, at any time, on terms reasonably acceptable to the Required Lenders, as defined in the DIP
Loan Agreement defined below, and subject to intercreditor arrangements on terms acceptable to the initial DIP Lenders, as defined below, the proceeds of which are to be used, first, to refinance the Prepetition Facilities, as defined below, and,
after the Prepetition Facilities have been paid in full, for working capital and general corporate purposes (an "ABL Facility");    

                        each on terms and conditions more fully described herein, secured by liens (as defined in
section 101(37) of the Bankruptcy Code and referred to herein as "Liens") on property of the estates pursuant to sections 364(c)(2), 364(c)(3) of the Bankruptcy Code and, solely with respect to the lien of record on that certain parcel of
real property referenced in the DIP Loan Agreement as the "Catawba Acre" (the "Catawba Acre Lien"), section 364(d) of the Bankruptcy Code, and pursuant to Rule 4001(c) of the Federal Rules of Bankruptcy Procedure (the
"Bankruptcy Rules") and the Local Bankruptcy Rules for the District of Delaware (the "Local Rules"), including Local Rule 4001-2, on the terms and conditions set forth in this Order;    
 (b)                establish a financing
arrangement (the "DIP Facility") pursuant to that certain Senior Secured Superpriority Debtor-in-Possession Credit Agreement, dated as of April    
  3
 
   
   
 21, 2009 (the "DIP Loan
Agreement") among Fairfax Financial Holdings Ltd. and Avenue Investments, L.P., as lenders (in such capacity and, together with the other financial institutions from time to time party thereto, collectively, the "DIP Lenders"), Fairfax
Financial Holdings Ltd., as administrative agent (in such capacity, the "DIP Agent") and Fairfax Financial Holdings Ltd., as collateral agent (in such capacity, the "Collateral Agent"), substantially in the form annexed to the Motion
as Exhibit A and incorporated herein by reference, to incur the "Obligations" under the DIP Loan Agreement (as provided for, and defined in, the DIP Loan Agreement, the "DIP Obligations");   
 (c)                authorize the Bowater Debtors to use the proceeds of the DIP Facility in a manner consistent with the DIP Loan Agreement for (a) working capital; (b) other general corporate purposes of the Bowater Debtors; (c) payment of any related
transaction costs, fees and expenses; (d) the payment of Adequate Protection Obligations (as defined below); and (e) the costs associated with administration of these Cases;    
 (d)                with respect to the
DIP Obligations of the Bowater Debtors, grant the Collateral Agent for the ratable benefit of the DIP Lenders, Liens upon the property of the US Debtors as provided in and as contemplated by the DIP Loan Agreement and the Collateral Documents (as
defined in the DIP Loan Agreement; the DIP Loan Agreement, the Collateral Documents and all such instruments and documents as may be executed and delivered in connection therewith or which relate thereto, collectively, the "DIP Loan
Documents"), as supplemented by this Order and, pursuant to section 364(c)(1) of the Bankruptcy Code, an allowed Superpriority Claim payable from and having recourse to all prepetition and postpetition property of the estates of the US Debtors,
as provided herein;   
  4
 
   
   
 (e)                with respect to the
DIP Obligations of the Canadian Debtors, grant the Collateral Agent, for the ratable benefit of the DIP Lenders, Liens upon the property of the Canadian Debtors as provided in and as contemplated by the DIP Loan Documents, as supplemented by this
Order, and, pursuant to section 364(c)(1) of the Bankruptcy Code, an allowed Superpriority Claim payable from and having recourse to all prepetition and postpetition property of the estates of the Canadian Debtors, as provided herein ;     
 (f)                  authorize the Bowater Debtors to use cash collateral (including cash maintained in deposit and securities accounts subject to
prepetition control agreements) and other collateral that is subject to prepetition liens under the Prepetition Facilities (as defined below) pursuant to sections 363(c) and 363(e) of the Bankruptcy Code and Bankruptcy Rule 4001(b) and Local Rule
4001-2, on the terms and conditions set forth in this Order;   
 (g)                authorize the US Debtors to provide adequate protection to Wachovia Bank, National Association as agent (the "US
Prepetition Agent") under, and to the lenders party to (and any lender or any affiliate thereof, who entered into a cash management arrangement and/or hedging obligations, the "US Prepetition Lenders" and together with the US
Prepetition Agent, the "US Prepetition Lienholders"), that certain Credit Agreement, dated as of May 31, 2006, as amended by that certain First Amendment dated as of July 20, 2007, that certain Second Amendment dated as of October 31, 2007,
that certain Third Amendment and Waiver dated as of February 25, 2008, that certain Fourth Amendment dated as of March 31, 2008, that certain Fifth Amendment dated as of April 30, 2008, that certain Sixth Amendment dated as of June 30, 2008, that
certain Seventh Amendment and Waiver dated as of August 7, 2008, that certain Eighth Amendment and Waiver dated as of November 12, 2008 and that certain Ninth Amendment and Consent dated as of February 27, 2009; and as further modified by
   
   
  5
 
   
   
   
 letter agreements dated March 17, 2009, March 23, 2009, March 31, 2009 and April 6, 2009 and as otherwise modified as of the date hereof (the "US Prepetition Credit Agreement"), among Bowater, Bowater Alabama LLC, Bowater
Newsprint South LLC and Bowater Newsprint South Operations LLC (collectively, the "US Prepetition Borrowers"), the guarantors named therein (the "US Prepetition Guarantors"), the US Prepetition Lienholders, and all collateral,
security and ancillary documents executed in connection therewith or which relate thereto (collectively, the "US Prepetition Loan Documents"), for any diminution in value of their interests in the US
Prepetition Collateral (as defined in paragraph L hereof), including the Cash Collateral, solely to the extent of US Prepetition Secured Indebtedness (as defined in paragraph L hereof), resulting from (i)
the Bowater Debtors' use of the Cash Collateral, (ii) the use, sale or lease of the Prepetition Collateral other than the Cash Collateral and (iii) the imposition of the automatic stay pursuant to section 362(a) of the Bankruptcy Code;   
 (h)                authorize the Bowater Debtors to provide adequate protection to the Bank of Nova Scotia as administrative agent (the "Canadian Prepetition Agent," together with the US Prepetition Agent, the "Prepetition Agents") under,
and to the lenders party to (and any lender or affiliate thereof, who entered into a cash management arrangement and/or hedging obligations, the "Canadian Prepetition Lenders," together with the Canadian Prepetition Agent, collectively the
"Canadian Prepetition Lienholders" and together with the US Prepetition Lienholders, collectively the "Prepetition Lienholders"), that certain Credit Agreement, dated   as of May 31, 2006, as amended by that
certain First Amendment dated as of July 20, 2007, that certain Second Amendment dated as of October 31, 2007, that certain Third Amendment and Waiver dated as of February 25, 2008, that certain Fourth Amendment dated as of March 31, 2008, that
certain Fifth Amendment dated as of April 30, 2008, that certain Sixth   
 6
 
  
  Amendment dated as of May 28,
2008, that certain Seventh Amendment dated as of June 6, 2008, that certain Eighth Amendment dated as of June 30, 2008, that certain Ninth Amendment and Waiver dated as of August 7, 2008, that certain Tenth Amendment and Waiver dated as of November
12, 2008 and that certain Eleventh Amendment and Consent dated as of February 27, 2009; and as further modified by the letter agreements dated March 17, 2009, March 23, 2009, March 31, 2009 and April 6, 2009, (the "Canadian Prepetition
Credit Agreement," and together with the US Prepetition Credit Agreement, the "Prepetition Credit Agreements"),  among Bowater Canada, as the borrower (the "Canadian Prepetition Borrower") and Bowater, Bowater Alabama
LLC, Bowater Newsprint South Operations LLC, Bowater Newsprint South LLC and certain of the Canadian Guarantors, as guarantors (the "Canadian Prepetition Guarantors"), the Canadian Prepetition Agent and the Canadian Prepetition Lenders
and all collateral, security and ancillary documents executed in connection therewith or which relate thereto (the "Canadian Prepetition Loan Documents," and together with the US Prepetition Loan Documents, the "Prepetition Loan
Documents"),  for any diminution in value of their interests in the Canadian Prepetition Collateral (as defined in paragraph L hereof), including the Cash Collateral, solely to the extent of Canadian
Prepetition Secured Indebtedness (as defined in paragraph L hereof), resulting from (i) the Bowater Debtors' use of the Cash Collateral, (ii) the use, sale or lease of the Canadian Prepetition Collateral other than the Cash
Collateral and (iii) the imposition of the automatic stay pursuant to section 362(a) of the Bankruptcy Code;
 (i)                  approve, in connection with the entry of the Final Order , a waiver of the provisions of section 506(c) of the Bankruptcy
Code;   
  7
 
  
   
 (j)                
 set the date for the hearing (the "Final Hearing") to consider the entry of the Final Order authorizing and approving, on a final basis, the transactions described in the foregoing clauses (a) through (i); and
(k)                waive any applicable stay (including under Rule 6004 of the Federal Rules of Bankruptcy Procedure) and
provide for immediate effectiveness of this Interim Order.  
 THE COURT HEREBY FINDS THAT:4
 A.                 On April 16, 2009 (the "Petition Date"), the Bowater Debtors filed voluntary petitions in the United States Bankruptcy Court
for the District of Delaware (the "Bankruptcy Court") for relief, and commenced proceedings under, chapter 11 of the Bankruptcy Code.  The Cases have been consolidated procedurally for administrative purposes, and the Bowater Debtors
 have continued in the possession of their assets and in the management of their businesses pursuant to sections 1107 and 1108 of the Bankruptcy Code. B.                  The Bankruptcy Court has jurisdiction, pursuant to 28 U.S.C. §§ 157(b) and 1334, over the Cases, and over the
persons and property affected hereby.  Consideration of the Motion constitutes a core proceeding as defined in 28 U.S.C. § 157(b)(2).  The statutory predicates for the relief sought herein are sections 105, 361, 362, 363, 364, 365 and
507 of the Bankruptcy Code and Bankruptcy Rules 2002 and 4001 and the Local Bankruptcy Rules.  Venue of the Cases in this District is proper pursuant to 28 U.S.C. §§ 1408 and 1409.
                                          
                                    
  4     Findings of fact shall be construed as conclusions of law and conclusions of law shall be construed as findings of fact
when appropriate. 
 8
 
    C.                 As of the
date hereof, the office of the United States Trustee for the District of Delaware (the "U.S. Trustee") has not appointed an official committee of unsecured creditors in these Cases pursuant to section 1102 of the Bankruptcy Code (a
"Committee").
  D.                 Prior to the Petition Date, the Bowater Debtors were provided
financing pursuant to the Prepetition Credit Agreements.
 E.                  The Bowater Debtors have
requested that the DIP Agent and the DIP Lenders enter into the DIP Facility to fund expenses, adequate protection and other general corporate purposes of the Bowater Debtors subject to compliance with the DIP Loan Agreement, including payment of
all fees and expenses then due and payable to the DIP Agent and DIP Lenders and payment of costs, fees and expenses in connection with the Bowater Debtors' Cases.  F.                  An immediate need exists for the Bowater Debtors to obtain funds and financial accommodations with which to continue their
ordinary course operations, meet their payroll and other necessary, ordinary course business expenditures, acquire raw materials, goods and services, satisfy the adequate protection provisions hereunder, and administer and preserve the value of
their estates.  The ability of the Bowater Debtors to finance their operations, requires the availability of additional working capital, the absence of which would immediately and irreparably harm the Bowater Debtors, their estates, and their
creditors.  It is vital that the Bowater Debtors maintain the ability to finance their operations in order to  preserve and maintain their going concern value.   
 G.                 The Bowater Debtors are unable to obtain unsecured credit under sections 503(b)(1), 364(a) and (b) of the Bankruptcy Code and are
only able to obtain secured credit under sections 364(c)(1), 364(c)(2), 364(c)(3) and, solely in respect of the Catawba Acre Lien,  9
 
  
 364(d) of
the Bankruptcy Code under the terms and conditions set forth in this Order and in the DIP Loan Documents.
 H.                
The relief requested in the Motion is necessary, essential and appropriate for the continued operation of the Bowater Debtors' businesses and the management and preservation of their properties.  I.
                   It is in the best interest of Bowater Debtors' estates to be authorized to borrow under the DIP Facility
contemplated by the DIP Loan Agreement and the other DIP Loan Documents. 
 J.                    The terms and conditions of the DIP Facility, including those which provide for the payment of interest to, and fees of, the DIP Agent (for the ratable benefit of DIP Agent and the DIP Lenders) and the DIP Lenders at the times, and in the
manner provided under the DIP Loan Documents, as well as any fees paid directly to the DIP Agent or the DIP Lenders, are fair, reasonable, and the best available under the circumstances and reflect the Bowater Debtors' prudent business judgment
consistent with their fiduciary duties, and are supported by reasonably equivalent value and consideration.  K.               
 The DIP Loan Documents were negotiated in good faith and at arm's length between the Bowater Debtors, on the one hand, and the DIP Agent and the DIP Lenders, on the other hand.  Credit to be extended under the DIP
Facility will be so extended in good faith, in consequence of which the DIP Agent and the DIP Lenders are entitled to the protection and benefits of section 364(e) of the Bankruptcy Code. 
 10

  
  L.                
  Without prejudice to the rights of parties in interest (other than the Bowater Debtors) as set forth in paragraph 26 hereof, the Bowater Debtors (on behalf of and for themselves) admit, stipulate, acknowledge, agree as follows (the
"Bowater Debtors' Stipulations"):   (i)        Pursuant to the US Prepetition Credit Agreement, the US Prepetition Agent and the US Prepetition Lenders made loans and other financial
accommodations to or for the benefit of the US Debtors. 
 (ii)        The US Prepetition Credit Agreement provided the US Prepetition Borrowers with, among other things, $370,436,241 in
aggregate principal amount of revolving commitments.  As of the Petition Date, (x) the outstanding principal amount owed by the US Prepetition Borrowers under the US Prepetition Agreement was approximately $204,000,000; and (y) the outstanding
face amount of all undrawn letters of credit under the US Prepetition Agreement was approximately $68,500,000 (collectively, together with all other Obligations as defined in the US Prepetition Credit Agreement, the "US Prepetition Secured
Indebtedness").  (iii)       To secure the US Prepetition Secured Indebtedness, the US Prepetition Borrowers and US Guarantors granted to the US Prepetition Lienholders valid,
perfected, first priority security interests and liens on substantially all of the US Collateral, including among other things (a) substantially all of the assets consisting of personal property of Bowater, Bowater America Inc., Bowater Nuway Inc.,
Bowater Nuway Mid-States Inc., Bowater Newsprint South LLC, Bowater Newsprint South Operations LLC, and Bowater Alabama LLC, including without limitation (in each case as defined in the US Prepetition Credit Agreement) all (A) accounts; (B) cash and
currency; (C) chattel paper; (D) deposit  
 11
 
  
  accounts; (E) documents; (F) general intangibles; (G) instruments; (H) inventory; (I)
investment property; (J) letter-of-credit rights; (K) books and records pertaining to the foregoing; and (L) to the extent not otherwise included, all proceeds and products of any and all of the foregoing and all collateral security and supporting
obligations given by any Bowater Debtor with respect to any of the foregoing;  (b) the real estate, including land, fixtures, improvements, equipment, leases, rents, proceeds, and all personal, real and mixed property thereunder of Bowater
Alabama LLC and Bowater Newsprint South Operations LLC (collectively the "Shared Real Estate Assets"); (c) certain other assets of  Bowater Newsprint South LLC, Bowater Newsprint South Operations LLC, and Bowater Alabama LLC
(collectively, the "US Prepetition Collateral"). 
 (iv)       Based on the US Debtors' and the Canadian Debtors' preliminary analysis, to the best of their knowledge, as of the Petition
Date, the US Prepetition Collateral is in excess of the US Prepetition Secured Indebtedness and the Canadian Prepetition Collateral is in excess of the Canadian Prepetition Secured Indebtedness.    (v)       Certain of the US Guarantors have guaranteed the US Prepetition Secured Indebtedness. 
 (vi)       Pursuant to the Canadian Prepetition Credit
Agreement, the Canadian Prepetition Agent and the Canadian Prepetition Lenders made loans and other financial accommodations to or for the benefit of Bowater Canada.   
 (vii)      The Canadian Prepetition Credit Agreement provided the Canadian Prepetition Borrower with,
among other things, USD 163,893,053 in aggregate principal amount of revolving commitments, with a USD 50,000,000 sublimit for the issuance of standby letters of credit and a USD 10,000,000 sublimit for swingline loans.  As of
the Petition  12
 
  
  Date, (w) the outstanding principal amount owed by the Canadian Prepetition Borrower under the Canadian Prepetition Credit
Agreement was approximately CAD 61,110,910.83 as Canadian Prime Rate Loans (capitalized terms used in this paragraph only, but not otherwise defined in this Order, shall have the meanings ascribed to them in the Canadian Prepetition Credit
Agreement) plus approximately USD 18,474,500.00 as Base Rate Loans; (x) the outstanding face amounts of all Letters of Credit under the Canadian Prepetition Credit Agreement was approximately CAD 33,379,173.00 under the Letters of Credit
denominated in Canadian Dollars plus USD 877,039.00 under the Letters of Credit denominated in Dollars; and (y) in addition to the above, the Canadian Prepetition Borrower owes USD 12,000,000 of outstanding principal as the Fairfax Credit
Loan and USD 18,300,000 of outstanding principal as the EDC Credit Loan  and (z) certain outstanding amounts under the Swingline Loans (collectively, together with all other Obligations as defined in the Canadian Prepetition Credit
Agreement, the "Canadian Prepetition Secured Indebtedness," and together with the US Prepetition Secured Indebtedness, the "Prepetition Secured Indebtedness").  As set forth in the Canadian Prepetition Credit Agreement, any
payments or distributions on account of the Canadian Prepetition Secured Indebtedness shall be made in the applicable Permitted Currency for such Loans or other Obligations, as provided by the Canadian Prepetition Credit Agreement, or in the
equivalent amount of U.S. dollars at the spot exchange rate as of the date of such payment or distribution.  The Canadian Prepetition Agent, on behalf of itself and each Canadian Prepetition Lender, reserves the right to revise, amend and/or
supplement any amounts referred to herein with respect to the Canadian Prepetition Secured Indebtedness, including, but not  
 13
 
  
  limited to,
adjustments based on fluctuations in applicable exchange rates or any indemnification to which such parties are entitled.  In addition, nothing herein shall be construed to waive any additional amounts, claims, rights or defenses of the
Canadian Prepetition Agent or any Canadian Prepetition Lender against the Debtors, including, but not limited to, in connection with transactions other than the Canadian Prepetition Credit Agreement, administrative expense claims in accordance with
section 503 or 507 of the Bankruptcy Code, or amounts owed pursuant to section 506(b) of the Bankruptcy Code. 
 (viii)     The Canadian Prepetition Secured Indebtedness is secured by valid, perfected,
first priority liens in and security interests on, among other things, (a) the inventory, accounts receivable, deposit accounts and certain other assets of Bowater Canada, Bowater Canadian Holdings Incorporated, Bowater Canada Finance Limited
Partnership, Bowater Shelburne Corporation and Bowater LaHave Corporation, (b) 100% of total issued and outstanding units of Bowater Korea Ltd., (c) the Shared Real Estate Assets, and (d) mortgages on certain other real property and
improvements thereon, together with certain other rights related thereto, owned by Bowater Canada in Canada (the "Canadian Real Estate Assets") (collectively, the "Canadian Prepetition Collateral," together with the US Prepetition
Collateral, the "Prepetition Collateral") ; provided, however, that nothing herein shall be deemed to be a stipulation, admission or agreement by the Bowater Debtors as to any claims or causes of action against the Fairfax Credit
Lenders that arise under this Order, the Canadian Prepetition Credit Agreement or related credit documents, the Bankruptcy Code or applicable law.    (ix)       U.S. Prepetition Borrowers
and the Canadian Guarantors have guaranteed the Canadian Prepetition Secured Indebtedness. 
 14
 
  
 (x)       Nothing in this
Order or any DIP Loan Document shall be construed as limiting the amount of Prepetition Secured Indebtedness or prejudice the right of the DIP Agents or any DIP Lenders, or the rights of any party in interest other than the Bowater Debtors (subject
to the terms set forth herein) to contest the amount of Prepetition Secured Indebtedness.  (xi)       The Bowater Debtors do not owe any debts or obligations secured by the Catawba Acre
Lien.           
 M.                As a result of the grant of the
DIP Liens, subordination to the Carve-Out (defined below), and the use of the Prepetition Collateral, including Cash Collateral, authorized herein, and the imposition of the automatic stay under section 362 of the Bankruptcy Code, the Prepetition
Lienholders are entitled to adequate protection pursuant to sections 361, 362 and 363 of the Bankruptcy Code as set forth herein.  The Bowater Debtors have agreed, in their reasoned business judgment, to provide adequate protection to the
Prepetition Lienholders on the terms and conditions set forth in this Order, which terms and conditions are fair and reasonable and were negotiated in good faith and at arm's length.
 N.                 Due and appropriate notice of the relief requested in the Motion and the Interim Hearing was given by electronic mail, facsimile
and/or overnight delivery to  the following parties, or, in lieu thereof, their counsel:  (i) the Office of the U.S. Trustee; (ii) the United States Securities and Exchange Commission; (iii) the Internal Revenue Service;
(iv) counsel to the Prepetition Agents; (v) counsel to the DIP Agent; (vi) the indenture trustees for each series of the Bowater Debtors' prepetition notes; (vii) the monitor appointed in the Canadian Proceeding; (viii) the parties
identified on the Bowater Debtors' consolidated list of thirty-five (35) largest unsecured creditors; (ix) the Bowater Debtors' primary cash management  15
 
  
 banks; (x) the Bowater Debtors' primary lockbox banks, (xi) the holder of record of the Catawba Acre Lien and (xii) the Environmental Protection Agency (collectively, the "Initial Notice Parties").  Such
notice constitutes good and sufficient notice of the Motion and the Interim Hearing under the circumstances in accordance with Bankruptcy Rules 4001(b), 4001(c), the Local Bankruptcy Rules and section 102(1) of the Bankruptcy Code, as required by
sections 363(c), 363(e) and 364(c) of the Bankruptcy Code in light of the emergency nature of the relief requested in the Motion.
 O.                 Good and sufficient cause has been shown for the entry of this Order.  Among other things, the entry of this Order will enable
the Bowater Debtors:  to continue the operation of their business and avoid immediate and irreparable harm to the Bowater Debtors' estates and their properties; to meet payroll, related taxes and other operating expenses; to obtain
needed supplies and raw materials; and to avoid disputes with the Prepetition Lienholders with respect to adequate protection.  Entry of this Order is in the best interests of the Bowater Debtors, their creditors, and
their estates.  Approval of the DIP Facility is vital to avoid immediate and irreparable harm to the Bowater Debtors' estates, and is therefore in the best interests of all stakeholders in the Bowater Debtors' estates.  
  NOW THEREFORE, the Bankruptcy Court having considered the
Declaration of William G. Harvey in Support of Chapter 11 Petitions and Various First Day Applications and Motions and the exhibits attached thereto, the DIP Loan Documents, the DIP Motion and the Declaration of Steven Zelin in Support
Thereof, and the evidence submitted at the hearing on this Order (the "Interim Hearing"); and in accordance with Rules 2002, 4001(b), (c), and (d), and 9014 of the Bankruptcy Rules and the local rules of the Bankruptcy Court, due and
proper notice of the DIP Motion and the Interim Hearing having been given; an Interim Hearing having been held and  
  
  16
  
 
  
  
  concluded on April 17, 2009; and it appearing that approval of the interim relief requested in the DIP Motion is necessary to avoid immediate and irreparable harm to the
Bowater Debtors pending the Final Hearing and otherwise is fair and reasonable and in the best interests of the Bowater Debtors, their creditors, their estates and their equity holders, and is essential for the continued operation of the Bowater
Debtors' businesses; and all objections, if any, to the entry of this Order having been withdrawn, resolved or overruled by this Court; and after due deliberation and consideration, and for good and sufficient cause appearing therefor, 

 
  IT IS ORDERED that: 
  
 1.                 The Motion, and the
terms and the conditions of the DIP Loan Documents are hereby approved.  The Bowater Debtors are authorized to: 
  
 (a)
              enter into the DIP Facility; 
  
 (b)
              execute and deliver each of the DIP Loan Documents to which any Bowater Debtor is a party; 
  
 (c)               with respect to the Borrowers, borrow and obtain extensions of credit up to $206,000,000 under the DIP Loan
Agreement pending the Final Hearing; 
  
 (d)               pay
all fees and expenses required under or referred to in the DIP Loan Documents as they become due, including, agent fees, closing fees and exit fees, and reasonable fees and expenses of attorneys and other professionals in accordance with the terms
of the DIP Loan Agreement; 
  
 (e)               use the
proceeds of the DIP Facility in a manner consistent with the DIP Loan Agreement for (a) working capital; (b) other general corporate purposes of the Bowater Debtors; (c) payment of any related transaction costs, fees and expenses; and (d) the
costs associated with administration of the Bowater Debtors' Cases; provided,  
  
  
  17
 
  
  
 however, nothing contained in this Order or the DIP Loan Agreement shall permit the use of the proceeds of the DIP Facility to fund directly or indirectly the
working capital and other general corporate purposes of any Debtors other than the Bowater Debtors, nor shall such proceeds be used to fund the administrative expenses of the Parent's Case, unless such expenses result from an allocation of the other
Bowater Debtors' Cases; and (f)                 pay Adequate Protection Obligations (as defined in paragraphs 9 and 10).

 2.                   The Bowater Debtors are hereby authorized and directed to do and perform all
acts and to make, execute, and deliver all instruments and documents that may be required or necessary for the performance by the Bowater Debtors under the DIP Loan Documents and the creation and perfection of (i) the Liens
granted by the Bowater Debtors, as described in and provided for by the DIP Loan Documents and (ii) the Adequate Protection Liens (as defined in paragraphs 9 and 10).   
 3.                 
 Each officer of the Bowater Debtors hereby is authorized to execute and deliver each of the DIP Loan Documents, such execution and delivery to be conclusive of their respective authority to act in the name of and on behalf of
the Bowater Debtors.   
 4.                   (a)        The US Debtors are hereby authorized and directed to grant, subject to the
Carve-Out, to the Collateral Agent (for the ratable benefit of the DIP Lenders) and the Collateral Agent is hereby granted (for the ratable benefit of the DIP Lenders), subject to the Carve-Out, as collateral pursuant to the DIP Loan Documents to
secure all DIP Obligations of the US Debtors,  valid, enforceable and perfected security interests in and Liens (collectively, the "US DIP Liens") on all assets, including without limitation, all personal, real and mixed
property, of the US Debtors whether existing as of the Petition Date or thereafter, (but excluding Avoidance Actions as defined below), including without limitation, all intercompany debt payable to the US  18

 
  
 Debtors (the "US Intercompany Claims"), 100% of the capital stock held by the US Debtors in domestic subsidiaries and 65% of the capital stock held by the US Debtors in foreign
Subsidiaries (collectively, the "US Collateral"), with such security interests and US DIP Liens having the following priority: (A) pursuant to section 364(c)(3) of the Bankruptcy Code, immediately junior to valid, enforceable and
perfected security interests in, and Liens upon (the "Permitted US Prepetition Liens") the US Collateral granted pursuant to the US Prepetition Loan Documents or the Canadian Prepetition Loan Documents or perfected by the US Prepetition Agent
or the Canadian Prepetion Agent (but not granted) after the Petition Date to the extent such post-Petition Date perfection in respect of prepetition claims is permitted under the Bankruptcy Code and such other Liens as are expressly permitted under
the DIP Loan Documents or this Order, including any US Intercompany Claims in existence as of the Petition Date and replacement liens granted as adequate protection hereunder but excluding US Intercompany Claims arising after the Petition Date, (B)
pursuant to section 364(c)(2) of the Bankruptcy Code, a first-priority valid, enforceable and perfected security interest in, and Liens upon (i) the real property, physical plants, fixtures, equipment and other related property of the US Debtors
(not including assets subject to the Prepetition Liens and Adequate Protection Liens) including but not limited to the real property, physical plants, fixtures, equipment and other related property that comprise the Bowater Debtors' respective
properties located in Catawba, South Carolina and Calhoun, Tennessee, and (ii) any US Intercompany Claims arising after the Petition Date; and (C) pursuant to section 364(d)(1) of the Bankruptcy Code, a valid, binding, enforceable and perfected
priming Liens upon that portion of such property comprising the Catawba Acre, solely to the extent of the Catawba Acre Lien (the collateral described in clauses (B) and (C) hereunder, being the "US Lender Priority Collateral") . 
  19
 
  
  
 (b)       The Canadian Debtors are hereby authorized and directed to grant,
subject to the Carve-Out, to the Collateral Agent (for the ratable benefit of the DIP Lenders) and the Collateral Agent is hereby granted (for the ratable benefit of the DIP Lenders), subject to the Carve-Out, as collateral pursuant to the DIP Loan
Documents to secure all DIP Obligations of the Canadian Debtors, valid, enforceable and perfected security interests in and Liens (collectively, the "Canadian DIP Liens", together with the US DIP Liens, collectively, the "DIP Liens")
on all assets, including without limitation, all personal, real and mixed property, of the Canadian Debtors whether existing as of the Petition Date or thereafter (but excluding Avoidance Actions as defined below), including without limitation, all
intercompany debt payable to the Canadian Debtors (the "Canadian Intercompany Claims"), 100% of the capital stock held by the Canadian Debtors in their Subsidiaries (collectively, the "Canadian Collateral", together with the US
Collateral, collectively, the "Collateral"), with such security interests and Canadian DIP Liens having the following priority: (A) pursuant to section 364(c)(3) of the Bankruptcy Code, immediately junior to valid, enforceable and
perfected security interests in, and Liens upon (the "Permitted Canadian Prepetition Liens" and together with the Permitted US Prepetition Liens, the "Permitted Prepetition Liens") the Canadian Collateral granted pursuant to the
Prepetition Facilities or perfected by the Prepetition Agents (but not granted) after the Petition Date to the extent such post-Petition Date perfection in respect of prepetition claims is permitted under the Bankruptcy Code and such other Liens as
are expressly permitted under the DIP Loan Documents or this Order, including any Canadian Intercompany Claims in existence as of the Petition Date and replacement liens granted as adequate protection hereunder but excluding Canadian Intercompany
Claims arising after the Petition Date, and (B) pursuant to section 364(c)(2) of the Bankruptcy Code, a first-priority valid, enforceable and  20
 
  
 perfected security interest in, and Liens upon (i) assets of the Canadian Debtors not subject to valid, enforceable and perfected Liens, and (ii) Canadian Intercompany Claims arising after the Petition Date (the collateral described in
clause (B) hereunder,  being the "Canadian Lender Priority Collateral", together with the US Lender Priority Collateral, collectively the "Lender Priority Collateral").
                           
 (c)
       the Canadian Debtors are authorized to grant the US Debtors, and there is granted, subject to the Carve-Out, as collateral to secure all intercompany claims arising after the Petition Date, pursuant to section
364(c)(3) of the Bankruptcy Code, security interests in and liens on all Canadian Collateral, junior to the Permitted Canadian Liens, the Canadian Lender Priority Collateral and the Canadian Adequate Protection Liens.                           
 (d)
      Notwithstanding the foregoing clauses (a) and (b), the Collateral under this Order shall not include any causes of action or other avoidance power claims arising under sections 544, 545, 547, 548, 550 (solely with
respect to claims asserted under sections 544, 545, 547, 548 and 553 of the Bankruptcy Code) and 553 of the Bankruptcy Code (collectively, "Avoidance Actions") or the proceeds thereof.   
 5.                 
 Notwithstanding the automatic stay imposed under section 362(a) of the Bankruptcy Code, (i) the Bowater Debtors are hereby permitted to grant the DIP Liens and the   Adequate Protection Liens, and perform
the DIP Obligations and Adequate Protection Obligations and incur the liabilities to the DIP Agent and the DIP Lenders under the DIP Loan Documents, (ii) the DIP Agent may deliver an Enforcement Notice (as defined in paragraph
21) following a DIP Order Event of Default with respect to the Lender Priority Collateral, and (iii) the DIP Agent and the Prepetition Agents are hereby permitted to file and record financing statements, mortgages or other instruments to provide
further notice of and evidence the grant  21
 
  
 and perfection of the Liens granted to the DIP Agent and DIP Lenders and the Prepetition Agents (on
behalf of the Prepetition Lienholders); provided, however, that notwithstanding the order in which any financing statements, mortgages or other instruments are filed, the priority of the liens granted in favor of the DIP Agent, the DIP
Lenders and the Prepetition Agents (on behalf of the Prepetition Lienholders) shall be governed solely by the terms of this Order.
 6.                     (a)                The Bowater Debtors are hereby authorized to use the cash and cash equivalent proceeds of the Prepetition Collateral that constitute "cash
collateral" within the meaning of section 363 of the Bankruptcy Code, located in deposit or securities accounts subject to control agreements or otherwise within the control of the Prepetition Agent or the Prepetition Lenders (the "Cash
Collateral") and other property in which the Prepetition Agent and the Prepetition Lenders have an interest pursuant to sections 363(b) and 363(c) of the Bankruptcy Code in accordance with the terms and conditions of the DIP Loan Agreement and
this Order; provided that, such Cash Collateral may be used as authorized and permitted herein and, except for use of Cash Collateral in respect of the Carve-Out, only so long as (i) the Termination Date (as defined in paragraph
18) shall not have occurred under the DIP Loan Agreement, (ii) the Final Order shall have been entered by the Bankruptcy Court on or before the forty-fifth (45th) day after the Petition Date or such later date as
agreed among the Bowater Debtors, the DIP Agent and the Prepetition Agents and (iii) there is no continuing default by the Bowater Debtors of the Adequate Protection Obligations arising under paragraph 9(c) or 10(c) of this Order.   

(b)       Except as otherwise agreed in writing among the Bowater Debtors, the DIP Agent and the DIP Lenders, the Bowater Debtors shall use proceeds of the DIP Facility and proceeds of DIP Collateral only
as permitted under the DIP Loan Documents; provided that  22
 
  
 notwithstanding anything to the contrary herein or in any DIP Loan Document,
proceeds of the Prepetition Collateral (other than proceeds of Intercompany Claims, proceeds of accounts receivable and from the sale or disposition of inventory in the ordinary course and obsolete, worn-out or surplus equipment in an aggregate
amount not greater than $3,000,000) shall not constitute cash collateral and the Debtors shall not be permitted to use such proceeds other than pursuant to further Court order.   
   
 7.                
 The DIP Liens and the Adequate Protection Liens shall not be subject or subordinate to (i) any Prepetition Permitted Lien or security interest that is avoided and preserved for the benefit of the Bowater Debtors and their
estates including liens preserved under section 551 of the Bankruptcy Code, (ii) except as provided in this Order and the DIP Loan Documents, any Liens arising after the Petition Date including, any Liens or security interests granted in favor of
any federal, state, provincial, municipal or other governmental unit, commission, board or court for any liability of the Bowater Debtors; or (iii) any intercompany or affiliate liens of the US Debtors.  In the event the US Debtors default in
the performance of the Adequate Protection Obligations described in paragraph 9(c) below, the US Prepetition Agent may seek relief from the automatic stay to enforce any and all rights and remedies with respect to the US Prepetition Secured
Indebtedness and US Prepetition Collateral if such default shall be continuing for more than five business days.  In the event the Canadian Debtors default in the performance of the Adequate Protection Obligations described in paragraph 10(c)
below, the Canadian Prepetition Agent may seek relief from the automatic stay to enforce any and all rights and remedies with respect to the Canadian Prepetition Secured Indebtedness and the Canadian Prepetition Collateral and Canadian Lender
Priority Collateral if such default shall be continuing for more than five business days.  Notwithstanding the foregoing, the Prepetition Lienholders  23
 
  

shall not have the right to sell or otherwise dispose of any collateral on which the DIP Agents and the DIP Lenders have a Lien senior to the Liens of any Prepetition Lienholder.
   
 8.                
 All amounts applied to the payment of the DIP Obligations shall be applied thereto in the manner set forth in the DIP Loan Documents.   
  9.             
   
  The Bowater Debtors acknowledge and stipulate that the US Prepetition Lienholders are entitled, pursuant to sections 361 and 363(e) of the Bankruptcy Code, to adequate protection of their interest in the US Prepetition Collateral,
 including the Cash Collateral, for any diminution in value of the US Prepetition Lienholders' US Prepetition Collateral, including, without limitation, any such diminution resulting from the sale, lease or use by the Bowater Debtors (or other
decline in value) of Cash Collateral and any other US Prepetition Collateral, and the imposition of the automatic stay pursuant to section 362 of the Bankruptcy Code.  As adequate protection, the US Prepetition Lienholders are hereby granted
the following (collectively, the "US Adequate Protection Obligations"):   
 (a)                The US Prepetition Agent (for itself and for the ratable benefit of the US Prepetition Lienholders) is hereby granted valid, binding and
enforceable Liens effective and perfected upon the date of this Order (without the necessity of the execution by the US Debtors of mortgages, security agreements, pledge agreements, financing statements or other agreements) replacement security
interests in and Liens upon all the US Collateral, subject only to the Carve-Out and having the following priorities:  (i) first priority Liens on all pre-and postpetition accounts, cash and currency (other than proceeds of DIP Facility loans
and Lender Priority Collateral), chattel paper, deposit accounts (other than proceeds of DIP Facility Loans and Lender Priority Collateral), documents, general intangibles (including the intercompany claims referred to in paragraph 4(c) above),
instruments, inventory, investment property, letter-of-credit    
  24
 
   
   
   
 rights, and
proceeds and products of the foregoing; provided that any such first priority Lien on Intercompany Claims shall be limited to the amount of the US Intercompany Claims in existence as of the Petition Date; (ii) first priority Liens on the
Shared Real Estate Assets, which shall be pari passu and pro rata with the Liens securing the Canadian Adequate Protection Obligations; and (iii) second priority Liens on all US Lender Priority Collateral, immediately junior to the DIP
Liens (the "US Adequate Protection Liens")   
 (b)                The US Prepetition Agent and other US Prepetition Lienholders are hereby granted, subject to the payment of the Carve-Out, a super
priority claim pursuant to section 507(b) of the Bankruptcy Code (against the US Debtors) which shall be pari passu with the Superpriority Claims held by the DIP Agent and DIP Lenders.   
 (c)                The US Prepetition Agent shall receive from the US Debtors (i) immediate cash payment of all accrued and unpaid interest on the US Prepetition Secured Indebtedness at the non-default rates provided for in the US Prepetition Credit
Agreement, and all accrued and unpaid fees and disbursements owed to the US Prepetition Agent and reasonable fees of counsel and other professionals of the US Prepetition Agent under the US Prepetition Agreement incurred prior to the Petition Date,
(ii) current cash payment of all fees and expenses payable (including without limitation, US Prepetition Agent fees and letter of credit fees owing to Issuing Lenders (as defined in the US Prepetition Credit Agreement)) under the US Prepetition
Credit Agreement, and, with respect to the US Prepetition Agent, the reasonable fees and disbursements of counsel and other professionals for the US Prepetition Agent, and (iii) current monthly payment of all accrued but unpaid interest on such US
Prepetition Secured Indebtedness at the non-default rate until repayment in full of such debt.  With respect to all interests, fees, and expenses described in this paragraph, the US Prepetition Lienholders reserve their rights to assert claims
for the payment  25
 
  
 of additional interest or fees calculated at any other applicable rate (including, without limitation, default rates), or on
any other basis, provided for in the US Prepetition Agreement, without prejudice to the rights of any other party to contest such assertion; provided, however, in the event that it is determined by a final, non-appealable order that any
payments received by any of the Prepetition Agents and Prepetition Lenders as adequate protection could not be applied to post-petition interest, fees and expenses under section 506(b) of the Bankruptcy Code, any such payments may, upon appropriate
notice, hearing and order, be recharacterized as payment of principal or subject to such other relief as the Court may order.
   

(d)               The US Prepetition Agent and the US Prepetition Lenders shall receive all financial statements and other
reports that are furnished to the DIP Agent and the DIP Lenders at the same time provided for in the DIP Loan Documents.   
 10.              In accordance with sections 361 and 363(e) of the Bankruptcy Code, as adequate protection,  the Canadian
Prepetition Agent is hereby granted (for the ratable benefit of the Canadian Prepetition Agent and the Canadian Prepetition Lenders) the following forms of adequate protection to the extent of diminution in the value of the Canadian Prepetition
Collateral subsequent to the Petition Date (the "Canadian Adequate Protection Obligations," and together with the US Adequate Protection Obligations, the "Adequate Protection Obligations") by (i) sale, lease or use of the Prepetition
Collateral including any Canadian Cash Collateral, and (ii) the imposition of the automatic stay pursuant to section 362 of the Bankruptcy Code:   
 (a)               The Canadian Prepetition Agent (for the ratable benefit of the Canadian Prepetition Lienholders) shall receive valid, binding, enforceable and perfected Liens, in each case subject to the Carve-Out, as follows (collectively, (a)(i) –
(iv), the "Canadian Adequate  26
 
  
 Protection Liens" and together with the US Adequate Protection Liens, the
"Adequate Protection Liens"):   
 i.                Replacement of Liens on Canadian Prepetition Collateral.  First priority replacement security interests
in and Liens upon (the "Canadian Replacement Liens") the Canadian Prepetition Collateral, including, without limitation, first priority Liens on the Shared Real Estate Assets, which shall be pari passu and  pro rata with the
Liens securing the US Adequate Protection Obligations, all proceeds thereof and accounts receivable generated therefrom, but excluding any and all postpetition Intercompany Claims;   
 ii.             Postpetition Junior Liens on Certain
DIP Collateral.  Subject and subordinate only to the DIP Liens relating to the Canadian Lender Priority Collateral and Permitted Prepetition Liens, security interests in and Liens upon the Canadian Lender Priority
Collateral, including, without limitation, all postpetition Intercompany Claims and all proceeds thereof and accounts receivable generated therefrom;  
 iii.
            Third Liens on Canadian Prepetition Collateral.  Subject and subordinate only to the DIP Liens
relating to the Canadian Real Estate Assets, security interests in and Liens upon the Canadian Real Estate Assets, including, without limitation, all proceeds thereof and accounts receivable generated therefrom; and  
 iv.            Junior Liens on US DIP
Collateral.  Subject and subordinate only to the DIP Liens relating to the US Lender Priority Collateral, the US Adequate Protection Liens and the Permitted US Prepetition Liens, security interests in
and Liens upon the any and all assets or property of the US Debtors that constitute the DIP Collateral hereunder, including, without limitation, all Intercompany Claims, all proceeds thereof and accounts receivable generated therefrom.  
 (b)               The Canadian Prepetition Agent and other
Canadian Prepetition Lienholders are hereby granted, subject to the payment of the Carve-Out, a super priority claim pursuant to section 507(b) of the Bankruptcy Code (against the Canadian Debtors) which shall be pari passu  with the
Superpriority Claims held by the DIP Agent and DIP Lenders.   
 (c)               The Canadian Prepetition Agent shall receive from the Canadian Debtors (i) immediate cash payment of all accrued and unpaid interest on
the Canadian Prepetition Secured Indebtedness at the non-default rates provided for in the Canadian Prepetition Credit  27
 
  
 Agreement, and all
accrued and unpaid fees and disbursements owed to the Canadian Prepetition Agent and reasonable fees of counsel and other professionals of the Canadian Prepetition Agent under the Canadian Prepetition Agreement incurred prior to the Petition Date,
(ii) current cash payment of all fees and expenses payable (including without limitation, Canadian Prepetition Agent fees and letter of credit fees owing to Issuing Lenders (as defined in the Canadian Prepetition Credit Agreement)) under the
Canadian Prepetition Credit Agreement, and, with respect to the Canadian Prepetition Agent, the reasonable fees and disbursements of counsel and other professionals for the Canadian Prepetition Agent, and (iii) current monthly payment of all accrued
but unpaid interest on such Canadian Prepetition Secured Indebtedness at the non-default rate until repayment in full of such debt.  With respect to all interests, fees, and expenses described in this paragraph, the Canadian Prepetition
Lienholders reserve their rights to assert claims for the payment of additional interest or fees calculated at any other applicable rate (including, without limitation, default rates), or on any other basis, provided for in the Canadian Prepetition
Agreement, without prejudice to the rights of any other party to contest such assertion;  provided, however, in the event that it is determined by a final, non-appealable order that any payments received by any of the Prepetition Agents and
Prepetition Lenders as adequate protection could not be applied to post-petition interest, fees and expenses under section 506(b) of the Bankruptcy Code, any such payments may, upon appropriate notice, hearing and order, be recharacterized as
payment of principal or subject to such other relief as the Court may order.
 (d)               The Canadian
Prepetition Agent and the Canadian Prepetition Lenders shall receive all financial statements and other reports that are furnished to the DIP Agent and the DIP Lenders at the same time provided for in the DIP Loan Documents.  28
 
  
 11.              (a)        This Order shall be sufficient and conclusive notice and evidence of the grant, validity, perfection, and priority of (i) the DIP Liens and (ii) the Adequate Protection
Liens, in each case without the necessity of filing or recording this Order (other than as docketed in the Cases) or any financing statement, mortgage or other instrument or document which may otherwise be required under the law of any jurisdiction
or the taking of any other action to validate or perfect the DIP Liens and the Adequate Protection Liens, or to entitle the DIP Agent or the Prepetition Agent to the priorities granted herein (including, in respect of cash or deposits or investment
property, any requirement that the DIP Agent or a DIP Lender have possession of or dominion and control over, any such cash in order to perfect an interest therein); provided that the Bowater Debtors are authorized to execute and the DIP
Agent and the Prepetition Agents may file or record financing statements, mortgages or other instruments further to evidence or further to perfect the DIP Liens and Adequate Protection Liens authorized, granted and perfected hereby; and provided
further that no such filing or recordation shall be necessary or required in order to create, perfect or affect the priority of any such Lien.  
 (b)       The Bowater Debtors are hereby authorized and directed to pay, no later than ten (10)
business days after receipt of invoices described in the proviso below, (i) to the extent provided for in the DIP Loan Agreement, all reasonable and documented costs, fees and out of pocket expenses of the DIP Agent and each Initial Lender (as
defined in the DIP Loan Agreement), including costs, fees and expenses incurred in connection with the negotiation and documentation of the DIP Facility and the matters set forth in this Order and (ii) Adequate Protection Payments on account of
professional fees described in paragraphs 9 and 10.  No such costs and expenses shall be subject to the approval of the Bankruptcy Court, and no recipient of any such payment shall be required to file with respect thereto any interim or final
fee  29
 
  
 application with the Bankruptcy Court, provided that invoices detailing the name, billing rate and time spent by each professional,
and a description of expenses incurred, shall be provided to counsel for the Bowater Debtors, the Committee and the U.S. Trustee.
 12.             The DIP Loan
Agreement and each of the DIP Loan Documents, respectively, shall constitute and evidence the valid and binding DIP Obligations of each of the Bowater Debtors, which DIP Obligations shall be enforceable against all of the Bowater Debtors in
accordance with their terms and the terms of this Order.   13.             
  (a)       
 The DIP Obligations shall be an allowed administrative expense claim with priority, subject and subordinate only to the Carve-Out, under sections 364(c)(1) and 507(b) of the Bankruptcy Code and otherwise over all administrative expense claims and unsecured
 claims against the Bowater Debtors, now existing or hereafter arising, of any kind or nature whatsoever, other than as provided in clause (c) of this paragraph 13 (the "DIP Superpriority Claim").
 (b)       Claims of the Prepetition Agents and Prepetition Lenders with respect to the Adequate Protection   Obligations shall be entitled to all of the benefits of section 507(b) of the
Bankruptcy Code; with priority, subject and subordinate only to the Carve-Out, and otherwise over all administrative expense claims and unsecured claims against the Bowater Debtors, now existing or hereafter arising, of any kind or nature
whatsoever, other than as provided in clause (c) of this paragraph 13 (the "Adequate Protection Superpriority Claim") .    
 (c)       Notwithstanding anything to the contrary herein, the DIP Superpriority Claim and the
Adequate Protection Superpriority Claim shall be treated as pari passu claims against the Bowater Debtors.  30
 
  
 14.               Interest on the DIP Obligations shall accrue at the rates and shall be paid at the times as provided in the DIP Loan Documents.  All DIP
Obligations shall become due and payable, without notice or demand, on the Termination Date.   
 15.               Except for the Carve-Out, no costs or expenses of administration, including, professional fees allowed and payable under sections 330 and 331 of the Bankruptcy Code that have been or may be incurred in the Cases, and no priority claims to
the Collateral are, or will be, prior to or on a parity with the DIP Obligations, the Adequate Protection Obligations, any DIP Superpriority Claim or Adequate Protection Claim, or any other claims of the DIP Agent (whether for itself or for the
ratable benefit of the DIP Lenders), the DIP Lenders or the Prepetition Agents (whether for themselves or for the ratable benefit of the Prepetition Lenders) arising hereunder.  16.              The term "Carve-Out" means:  (x) with respect to the US Debtors and their respective Cases and assets: (i) all fees required to be
paid to the Clerk of the Bankruptcy Court and the Office of the U.S. Trustee pursuant to 28 U.S.C. §1930; (ii) after the occurrence and during the continuance of an Event of Default, an amount not to exceed $7,500,000  plus all accrued
and unpaid professional fees and disbursements incurred prior to the occurrence of the Event of Default to the extent allowed by the Bankruptcy Court at any time, which amount may be used subject to the terms of the Interim Order (or the Final
Order, when applicable) to pay any fees or expenses incurred by the Bowater Debtors and any statutory committee appointed in the Cases in respect compensation for services rendered or reimbursement of expenses allowed by the Bankruptcy Court to
professionals of the Bowater Debtors or any statutory committee appointed in the Cases; and (iii) in the event of the conversion of the Cases to cases under Chapter 7 of the Bankruptcy Code, an amount not to exceed $50,000 in respect of allowances
of 
 31
 
  
 compensation for services rendered and reimbursement of expenses awarded by the Bankruptcy Court to the chapter 7 trustee or any
professional retained by such trustee; and (y) with respect to the Canadian Debtors and their respective Cases and assets: (i) the administration charge ordered by the Superior Court of Quebec (Commercial Division) (the "Canadian Court") in
an aggregate amount not to exceed CAD2,000,000 (the "Administration Charge") for the payment of (A) allowed and unpaid professional fees and disbursements incurred by professionals and advisers retained by the Canadian Debtors in the cases
pending before the Canadian Bankruptcy Court under Canada's Companies' Creditors Arrangement Act, R.S.C. 1985 c. C-36 (the "Canadian Proceeding"), and (B) allowed and unpaid professional fees and disbursements of the monitor in the
Canadian Proceeding, including allowed and unpaid fees and expenses of its counsel; and (ii) the Canadian Court ordered charge for directors in an aggregate amount not to exceed CAD7,500,000 (the "Directors' Indemnification and Charge"),
securing the Canadian Debtors' obligation to indemnify the directors of the Canadian Debtors for liability arising after entry of the CCAA Order or in connection with the Canadian Debtors' failure to make payments in respect of employee obligations
(as set forth more fully in paragraph 50 of the CCAA Order); provided, however, the dollar limitation set forth in clause (x)(ii) of this paragraph shall not be reduced by the amount of any compensation or reimbursement of expenses
incurred but unpaid, or paid (to the extent ultimately allowed by an order of the Bankruptcy Court), prior to the occurrence of an Event of Default in respect of which the Carve-Out is invoked or by any fees, expenses, indemnities or other amounts
paid to the DIP Agent, any DIP Lender, any Prepetition Lienholder or their respective attorneys and agents hereunder or otherwise; provided further, however, that nothing in this paragraph shall be construed to impair the ability of
any party to 
 32
 
  
 object, pursuant to section 330 of the Bankruptcy Code, to the reasonableness of the fees, expenses, reimbursement or compensation described
herein.
 17.              Solely upon entry of the Final Order, as a further condition of the DIP Facility, no costs or
expenses of administration of the Cases or any future proceeding that may result therefrom, including liquidation in bankruptcy or other proceedings under the Bankruptcy Code, shall be charged against or recovered from the Collateral, the
Prepetition Collateral or the Cash Collateral pursuant to section 506(c) of the Bankruptcy Code or any similar principle of law without the prior written consent of the DIP Agent or the Prepetition Agents, as the case may be, and no such consent
shall be implied from any other action, inaction, or acquiescence by the DIP Agent, the DIP Lenders, the Prepetition Agents or the Prepetition Lenders.  In addition, solely upon entry of the Final Order, the DIP Agent, the DIP Lenders, the
Prepetition Agents or the Prepetition Lenders shall each be entitled to all of the rights and benefits of section 552(b) of the Bankruptcy Code and the "equities of the case" exception under section 552(b) of the Bankruptcy Code shall not apply to
the DIP Agent, the DIP Lenders, the Prepetition Agents or the Prepetition Lenders with respect to proceeds, product, offspring or profits of any of the Collateral or the Prepetition Collateral, provided that, any rights that such parties have
prior to the Final Order remain in full force and effect.  
  18. 
           
  All (a) DIP Obligations shall be immediately due and payable, without notice and demand, and (b) authority to use the proceeds of the DIP Facility and to Collateral, including Cash Collateral shall cease, subject to the obligations
 with respect to the Carve-Out, on the Maturity Date (as defined in the DIP Loan Agreement) (the "Termination Date").   

19.              The occurrence of the Termination Date or, if sooner, the DIP Agent's furnishing the Bowater Debtors with notice
of the occurrence of any Event of Default (as defined in the DIP  33
 
  
 Loan Agreement) shall constitute a "DIP Order Event of Default".  Unless and
until the DIP Obligations and Adequate Protection Obligations are unconditionally and indefeasibly repaid in full in cash, the protections afforded respectively to the DIP Agent and the Prepetition Agents under the DIP Loan Documents and hereunder,
and any actions taken pursuant thereto and hereto, and the Carve-Out (as to pre-conversion or pre-effective date services) shall survive the entry of any order confirming a plan of reorganization or converting any of the Cases into a case pursuant
to chapter 7 of the Bankruptcy Code.  The Bowater Debtors agree not to seek, and it shall constitute an Event of Default under the DIP Loan Agreement, if any of the Bowater Debtors seek, without the written consent of the DIP Agent, or if there
is entered, (i) any modifications or extensions of this Order without the prior written consent of the DIP Agent, and no such consent shall be implied by any other action, inaction or acquiescence by the DIP Agent, (ii) an order converting any of
the Cases to a case under chapter 7 of the Bankruptcy Code or (iii) an order dismissing any of the Cases.  The Bowater Debtors further agree that the consensual use of Cash Collateral shall be deemed terminated if any of the Bowater Debtors
seek, without the written consent of the Prepetition Agents, and no such consent shall be implied by any other action, inaction or acquiescence by the Prepetition Agents, or if there is entered: (i) an order converting any of the Cases to a case
under chapter 7 of the Bankruptcy Code; (ii) an order dismissing any of the Cases; or (iii) any modification or extension of this Order that materially impairs the rights of either of the Prepetition Agents or their respective Prepetition Lenders.
If an order dismissing any of the Cases under section 1122 of the Bankruptcy Code or otherwise is at any time entered, such order shall provide (in accordance with sections 105 and 349 of the Bankruptcy Code), to the fullest extent permitted by law,
that (i) the DIP Liens, the Adequate Protection Liens, the DIP Superpriority Claim and the Adequate Protection Superpriority Claim 
 34
 
  
 granted, pursuant to the DIP Loan Documents and this Order, shall continue in full force and effect and maintain their priorities as provided in this Order until the DIP Obligations and Adequate Protection Obligations are indefeasibly paid
in full in cash and (ii) the Bankruptcy Court shall retain jurisdiction, notwithstanding such dismissal, for the purposes of enforcing the claims, Liens, priorities and security interests as provided in this Order.
 20.
             The time and manner of payment of the DIP Obligations, the DIP Liens and the DIP Superpriority Claim shall not be altered or
impaired by any chapter 11 plan of reorganization, that may hereafter be confirmed or by any further order of the Bankruptcy Court which may hereafter be entered without the consent of the DIP Agent and the DIP Lenders.
 
21.              Upon the occurrence of a DIP Order Event of Default and at any time thereafter during the continuance thereof,
with five business days' prior written notice (an "Enforcement Notice") of such occurrence, in each case given to the Bowater Debtors and the Bowater Debtors' counsel, counsel to the Committee, the Prepetition Agents, and the U.S. Trustee,
the DIP Agent shall be entitled to exercise rights any remedies as set forth in the DIP Loan Documents or under applicable law and the DIP Lenders shall be entitled to exercise set-off rights in accordance with the DIP Loan Documents or under
applicable law; provided however, that notwithstanding anything to the contrary contained herein or in any DIP Loan Documents, the DIP Agent and the DIP Lenders shall not have the right to sell or otherwise dispose of any collateral on which
the Prepetition Agents have a Lien senior to the Lien of any of the DIP Agent and the DIP Lenders, whether as a result of the Prepetition Liens or the Adequate Protection Liens.  Any Enforcement Notice shall also be filed with the Bankruptcy
Court and the Canadian Court.  Following the giving of an Enforcement Notice, the Bowater Debtors, the Committee, the Prepetition Agents and the U.S. Trustee shall be entitled to an emergency hearing before this  35
 
  

  Court to oppose the exercise of remedies; provided that the only issue that may be raised by the Bowater Debtors in opposition thereto shall be whether a DIP Order Event of Default has in fact occurred
 and is continuing, and the Bowater Debtors hereby waive their right to seek any relief, whether under section 105 of the Bankruptcy Code or otherwise, that would in any way impair, limit or restrict, or delay the exercise or benefit of, the rights
and remedies of DIP Agent or the DIP Lenders under the DIP Loan Documents or this Order;  provided, further, however, that in the event that the DIP Agent or any DIP Lender proposes to dispose of any real property on or in which there is
located any Prepetition Collateral on which either of the Prepetition Agents has a first lien, then a reasonable period of time shall be given to such Prepetition Agent to remove or dispose of such collateral before effecting such disposition. 
Subject to the preceding sentence, at the expiration of the five business day period, unless otherwise ordered by the Bankruptcy Court, the DIP Agent shall be entitled to pursue all remedies under the DIP Loan Documents or applicable law and any DIP
Lender shall be entitled to exercise set-off rights with the proceeds to be applied in accordance with the DIP Loan Documents and this Order without further order of the Bankruptcy Court.  The automatic stay is hereby deemed modified to permit
the pursuit of the remedies described in this paragraph 21.  In no event shall the DIP Agent or the Prepetition Agents be subject to the equitable doctrine of "marshalling" or any similar doctrine with respect to the Collateral.

  
 22.             Nothing included herein shall prejudice,
impair, or otherwise affect the rights of the DIP Agent, the DIP Lenders, the Prepetition Agents or the Prepetition Lenders to seek any other or supplemental relief in respect of the Bowater Debtors consistent with and subject to the provisions of
this Order. 36
 
  
 23.             If any provision of this Order is hereafter
modified, amended, vacated, reversed or stayed in any respect by subsequent order of this or any other court for any reason, such modification, amendment, vacation, reversal or stay shall not affect the validity of any Obligation or liability
incurred pursuant to this Order.
 24.             The Liens, DIP Superpriority Claim and Adequate Protection Superpriority Claim granted to the DIP Agent and DIP
Lenders under the DIP Facility and this Order, and to the Prepetition Agents and Prepetition Lenders under this Order, and the priority thereof, and any payments made pursuant to the DIP Facility and this Order, shall be binding (subject to the
terms of this Order) on the Bowater Debtors, any successor trustee or examiner, and all creditors of the Bowater Debtors, as provided in section 364(e) of the Bankruptcy Code.   25.
              Notwithstanding anything herein or in any other order by the Bankruptcy Court to the contrary, no party may, and no borrowings,
Cash Collateral, Prepetition Collateral, DIP Collateral, portion of the proceeds of the DIP Facility or part of the Carve-Out may be used for any of the following (each, a "Lender Claim") without the prior written consent of each affected
party to: (a) object, contest or raise any defense to the validity, perfection, priority, extent or enforceability of any amount due under any DIP Loan Document or the Prepetition Credit Agreement or the Liens or claims granted under this Order, any
DIP Loan Document or the Prepetition Credit Agreements, (b) assert any claim or cause of action against any entity that is a DIP Agent, DIP Lender, Prepetition Agent or Prepetition Lender or their respective agents, affiliates, representatives,
attorneys or advisors, (c) except as otherwise permitted herein, prevent, hinder or otherwise delay the DIP Agent's or the Prepetition Agents' assertion, enforcement or realization on the Cash Collateral, the Prepetition Collateral or the Collateral
in accordance with the DIP Loan Documents, the Prepetition Credit Agreements or this Order, (d) 
 37
 
  

  assert or prosecute any action for preferences, fraudulent conveyances, other avoidance power claims or any other claims, counterclaims or causes of action, objections, contests or defenses against any Prepetition
 Lender or DIP Lender or their respective agents, affiliates, representatives, attorneys or advisors, or (e) seek to modify any of the rights granted to the DIP Agent, the DIP Lenders, the Prepetition Agents or the Prepetition Lenders hereunder or
under the DIP Loan Documents or the Prepetition Credit Agreements, provided that advisors to the   Committee may investigate the Prepetition Secured Indebtedness and the Bowater Debtors may investigate the Prepetition
Secured Indebtedness only to the extent of claims and causes of action identified in the proviso to paragraph L(viii), and, subject to paragraph 26(c) and to any applicable law with respect to standing, commence any related proceedings as a
representative of the Bowater Debtors' estates at an expense not to exceed $50,000 to be shared between the Committee and the Bowater Debtors.   
 26.              (a)        Each stipulation, admission and agreement contained in this Order shall be binding upon the
Bowater Debtors and any successor thereto (including, any chapter 7 or chapter 11 trustee appointed or elected for any of the Bowater Debtors), and the Bowater Debtors are deemed to have irrevocably waived and relinquished all Lender Claims as of
the date of entry of this Order.  Each stipulation, admission and agreement contained in this Order shall also be binding upon all other parties in interest, including the Committee, under all circumstances and for all purposes, except to the
extent that (i) a party in interest has, subject to the limitations contained herein, including, inter alia, in paragraph 25, timely and properly filed an adversary proceeding or contested matter asserting a Lender Claim
with respect to any of the stipulations or admissions set forth in this Order by no later than the date that is 75 days (or such later date as has been agreed to, in writing, by the DIP Agent and Prepetition Agents, as applicable) after the 
38
 
  
 appointment of the Committee, and (ii) the Bankruptcy Court enters a final order in favor of the plaintiff sustaining such Lender Claim.

 
 (b)       The success of any particular Lender Claim shall not alter the binding effect on
each party in interest of any stipulation or admission not subject to such Lender Claim.  Except to the extent (but only to the extent) a timely and properly filed adversary proceeding or contested matter asserting a Lender Claim is successful,
(i) the Prepetition Secured Indebtedness shall constitute allowed claims, not subject to avoidance, recharacterization, recovery, subordination, attack, offset, counterclaims, defense or "claim" (as such term is defined in the Bankruptcy Code) of
any kind pursuant to the Bankruptcy Code or other applicable law, for all purposes in the Cases and any subsequent chapter 7 cases, (ii) the security interests of the Prepetition Agents and Prepetition Lenders pursuant to the Prepetition Credit
Agreements to the extent securing the Prepetition Secured Indebtedness shall be deemed to have been, as of the Petition Date, legal, valid, binding perfected and enforceable liens and security interests not subject to avoidance, recharacterization,
recovery, subordination, attack, offset, counterclaims, defense or "claim" (as such term is defined in the Bankruptcy Code) of any kind, and (iii) the Prepetition Secured Indebtedness and the security interests of the Prepetition Agents and
Prepetition Lenders pursuant to the Prepetition Credit Agreements to the extent securing the Prepetition Secured Indebtedness shall not be subject to any other or further challenge by any party in interest seeking to exercise the rights of the
Bowater Debtors' estates, including, any successor thereto (including, any chapter 7 or chapter 11 trustee appointed or elected for any of the Bowater Debtors).  39
 
  

 
 (c)       Nothing in this Order vests or confers on any person (as defined in the Bankruptcy
Code), including the Creditors Committee, with standing or authority to pursue any cause of action belonging to the Bowater Debtors or their estates, including, Lender Claims. 27.              The DIP Agent's or any DIP Lender's failure to seek relief or otherwise exercise its rights and remedies under the DIP Facility or this Order,
and the Prepetition Agents' or any Prepetition Lender's failure to seek relief or otherwise exercise its rights and remedies under this Order, shall not constitute a waiver of any of the DIP Agent's, the Prepetition Agents' or such DIP Lender's or
Prepetition Lenders' rights hereunder, thereunder, or otherwise.
 28.              Subject to the provisions of the DIP
Loan Agreement, the Bowater Debtors, the DIP Agent and the Required Lenders (as defined in the DIP Loan Documents) may amend, and the DIP Agent and the DIP Lenders may waive, any provision of the DIP Loan Documents, without seeking the approval of
the Bankruptcy Court; provided that such amendment or waiver is either nonprejudicial to the rights of the Prepetition Lenders and other third parties or is not material, and that notice thereof be provided to the Prepetition Agents, counsel
for the Prepetition Agents, counsel for the Committee and the U.S. Trustee no less than five days prior to the effective date of such amendment or waiver (or such shorter period as to which such parties may agree).  Except as otherwise set
forth in the foregoing sentence, no waiver, modification, or amendment of any of the provisions hereof or of the DIP Loan Documents shall be effective unless set forth in writing and approved by the Bankruptcy Court.   
 29.             Nothing in this Order or in any of the DIP Loan
Documents or any other documents or agreements related to the DIP Facility shall in any way be construed or interpreted to impose upon the DIP Agent or any of the DIP Lenders, or the Prepetition Agents or the Prepetition Lenders any liability for
any claims or causes of action arising from activities or by  40
 
  
 the Bowater Debtors or any of their affiliates prior to the Petition Date or
subsequent to the Petition Date, whether in connection with the operation of their businesses, the Cases, any restructuring efforts prior to the commencement of the Cases, or otherwise.  In no event shall the DIP Agent or any DIP Lender, or the
Prepetition Agents or any Prepetition Lender, whether in connection with the exercise of any rights or remedies under the DIP Loan Documents or otherwise, be deemed to be in control of the operations of the Bowater Debtors or to be acting as a
"responsible person" or "owner or operator" with respect to the operation or management of the Bowater Debtors, so long as the DIP Lenders' actions do not constitute, within the meaning of 42 U.S.C. §§ 901(20)(F), actual participation in
the management or operational affairs of a vessel or facility owned or operated by a Bowater Debtor, or otherwise cause liability to arise to the federal or state government or the status of responsible person or managing agent to exist under
applicable law (as such terms, or any similar terms, are used in the United States Comprehensive Environmental Response, Compensation and Liability Act, sections 9601 et seq. of title 29, United States Code, as amended, or any similar federal
or state statute).  
 30.              Any Subsidiary (as defined in the DIP Loan Agreement) of the Bowater
Debtors that hereafter becomes a debtor in a case under chapter 11 of the Bankruptcy Code in this Bankruptcy Court shall automatically, immediately upon the filing of a petition for relief for such Subsidiary, be deemed to be one of the "Bowater
Debtors" hereunder in all respects, and all the terms and provisions of this Order, including, those provisions granting security interests in, and Liens on, the DIP Collateral, DIP Superpriority Claims, Adequate Protection Obligations and Adequate
Protection Superpriority Claims in each of the Cases, shall immediately be applicable in all respects to such Subsidiary and its chapter 11 estate.
 41
 
  
 31.             In the event of any inconsistency between the terms and conditions of any DIP Loan Document and of this Order, the provisions of this Order shall govern and
control. 32.              Following entry of this Order, the Bowater Debtors shall, on or before April 20, 2009, provide
notice of the Motion, this Order and the Final Hearing by telecopy, overnight delivery service, hand delivery or U.S. mail to each of the Initial Notice Parties and, without duplication, to (i) the entities listed on the Consolidated List of
Creditors Holding the 50 Largest Unsecured Claims, (ii) counsel to the DIP Agent and counsel to each DIP Lender, if known by the Bowater Debtors, (iii) counsel to the Prepetition Agents, (iv) if practicable, the applicable state and local
taxing authorities, (v) parties who have filed a request for service prior to such date, and (vi) other secured parties as shown on any Uniform Commercial Code searches conducted prepetition.  Such notice shall constitute good and sufficient
notice of the Final Hearing.  The notice of approval of this Order shall state that any party in interest objecting to the DIP Facility, the adequate protection of the Prepetition Lenders or the terms of the Final Order shall file written
objections in the Cases with the Bankruptcy Court, and shall serve such objections so that they are received, by no later than 4:00 p.m. (EDT) on May 8, 2009.  Objections shall be served so that the same are actually received on or before such
date by: (a) counsel for the Bowater Debtors: (i) Paul, Weiss, Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New York, New York  10019-6064, Attention:  Kelley A. Cornish; (ii) Stikeman Elliott, LLP, 1155
René-Lévesque Blvd. West, Suite 4000, Montréal, QC H3B 3V2, Canada, Attention: Guy Martel; and (iii) Young Conaway Stargatt & Taylor, LLP, The Brandywine Building, 1000 West Street, 17th Floor, Wilmington, Delaware 19801,
Attention:  Pauline K. Morgan, (b) counsel for the Creditors' Committee (if retained); (c) counsel for the DIP Agent: (i) Shearman & Sterling LLP, 599 Lexington Avenue, New York, New York 10022, 
 42
 
  
 Attention:  Douglas P. Bartner and Fredric Sosnick; (ii) Torys LLP,   79 Wellington Street West, Suite 3000, Box 270, TD Centre, Toronto,
Ontario, M5K 1N2 Canada,  Attention  :  Michael Rotsztain; and (iii) Pachulski Stang Ziehl Young Jones & Weintraub LLP, 919 North Market Street, 17th Floor, Wilmington, DE  19801,
Attention:  Laura Davis Jones; (d) counsel to Avenue Capital: Kramer Levin Naftalis & Frankel LLP, 1177 Avenue of the Americas, New York, New York 10036, Attention:  Thomas T. Janover, John Bessonnette and Douglas
Mannal; (e) counsel to the Canadian Prepetition Agent: (i) Orrick, Herrington & Sutcliffe LLP, 666 Fifth Avenue, New York, New York 10103-0001, Attention: Raniero D'Aversa, Jr.; (ii) McCarthy Tetrault LLP, Suite 5300, TD Bank Tower, Toronto
Dominion Centre, Toronto, Ontario M5K 1E6, Attention: Kevin McElcheran; and (iii) Klehr, Harrison, Harvey, Branzburg & Ellers, LLP, 919 Market Street, Suite 1000, Wilmington, DE  19801, Attention: Joanne Wills, (f) counsel to
the US Prepetition Agent: (i) Morgan, Lewis & Bockius LLP, 101 Park Avenue, New York, NY  10178-0060,  Attention:  Richard Toder; (ii) Connolly Bove Lodge & Hutz LLP, The Nemours Building, 1007 N. Orange Street, 8th Floor,
Wilmington, DE 19801, Attention:  Jeffrey C. Wisler; (g) counsel for the U.S. Trustee, David Klauder, 844 King Street, Room 2207, Wilmington, DE 19108; and (h) Office of the Clerk of the Court, 824 Market Street, Third Floor,
Wilmington, Delaware  19801.  
 33.              This Order shall constitute findings of fact and conclusions of
law and shall be immediately effective and enforceable upon its entry and there shall be no stay of execution or effectiveness of this Order.  Specifically, pursuant to this Order, the ten day automatic stay periods of Bankruptcy Rule 6004 are
expressly inapplicable to this Order and the transactions including, without limitation, transfers contemplated hereby, and accordingly, this Order shall become operative immediately upon entry on the docket 43
 
  
 The Final Hearing to consider the Motion and Final Order is hereby scheduled for May 15, 2009 at 10:00 a.m. at United States Bankruptcy Court, District of Delaware, before the
undersigned United States Bankruptcy Judge.   
 SO ORDERED by the Court this
17th  day of April 2009.    
  ______________________________
    United States Bankruptcy Judge 
    
    
    
    44
 
  
 
    EXHIBIT D  
     
  FORM OF
 INITIAL CCAA ORDER 
  
 
	   CANADA  
	   SUPERIOR COURT  

	   PROVINCE OF QUÉBEC
 DISTRICT OF MONTRÉAL
 
 No. :  
	   Commercial Division
 (Sitting as a court designated pursuant to the
 Companies' Creditors Arrangement Act,
 R.S.C., c. C-36, as amended)
 

	      
	 
    

	      
	   IN THE
MATTER OF THE PLAN OF COMPROMISE OR ARRANGEMENT OF:  

	      
	      

	      
	   
ABITIBIBOWATER INC  ., a legal person incorporated under the laws of the State of Delaware, having its principal executive offices at 1155 Metcalfe Street, in the city and district of Montréal, Province of
Québec, H3B 5H2;  

	      
	  
And  

	      
	   
ABITIBI-CONSOLIDATED INC.  , a legal person incorporated under the laws of Canada, having its principal executive offices at 1155 Metcalfe Street, in the city and district of Montréal, Province of Québec,
H3B 5H2;  

	      
	  
And  

	      
	   BOWATER CANADIAN HOLDINGS INC.  , a legal person incorporated under the laws of the Province of Nova Scotia, having its principal executive offices at 1155 Metcalfe Street, in the city and district of
Montréal, Province of Québec, H3B 5H2;  

	      
	   And  

	      
	   the other Petitioners listed on Schedules "A", "B" and "   C   "  

	      
	   Petitioners  

	      
	  
And  

	      
	   ERNST & YOUNG 
  INC.  , a legal person under the laws of Canada, having a place of business at 800 René-Lévesque, Suite 2000, in the city and district of Montréal,
Province of Québec,   H3B 1X9  ;  

	      
	   Monitor
 

     
     
 
  

	   PETITION FOR THE ISSUANCE OF AN INITIAL ORDER 
 (Sections 4, 5 and 11 of the Companies' Creditors Arrangement Act ("CCAA"), sections 191 and ss.
of the Canada Business Corporations Act R.S.C. 1985, c. C-44 ("CBCA")  
   and 
   Petition for the issuance of a recognition order  
   (Section 18.6 of the CCAA)  

  

  TO ONE OF THE HONOURABLE JUDGES OF THE SUPERIOR COURT, SITTING IN COMMERCIAL DIVISION, IN AND FOR THE JUDICIAL DISTRICT OF MONTRÉAL, THE PETITIONERS
RESPECTFULLY SUBMIT THE FOLLOWING: 
   
  1.                    INTRODUCTION 
   
  1.                     Abitibi-Consolidated Inc. ("ACI" or "Abitibi"), the Petitioners listed on Schedule "A" hereto (collectively with ACI, the "Abitibi Petitioners"), Bowater Canadian Holdings
Incorporated ("BCHI") and the Petitioners listed on Schedule "B" hereto (collectively with BCHI, the "Bowater Petitioners") seek protection under the CCAA to facilitate the reorganization of their
capital structure.  
 
   
  2.                     The Abitibi Petitioners and the Bowater Petitioners are all subsidiaries of
Petitioner AbitibiBowater Inc. ("ABH", collectively with its subsidiaries the "ABH Group"), a Delaware corporation formed as a result of a merger of equals between Abitibi and Bowater Incorporated
("BI") completed in October 2007 .   
 
   
  3.                     ABH and the Petitioners listed on
Schedule "C" hereto (collectively with ABH, the "18.6 Petitioners") are Petitioners in these proceedings for the purpose of seeking the issuance of orders under Section 18.6 of the CCAA in respect of voluntary
proceedings initiated under Chapter 11 of Title 11 of the United States Code (the "U.S. Bankruptcy Code").  
 
   
  4.                     While the partnerships listed in Schedule "D" hereto (the "Partnerships") are not petitioners in these proceedings, the Abitibi Petitioners, the Bowater Petitioners and the 18.6 Petitioners (collectively the
"Petitioners") seek to have the stay of proceedings extended to the Partnerships as they form an integral part of the business of the Petitioners.  
 
   
  5.                     A chart illustrating the basic corporate structure of the ABH Group is communicated as
Exhibit R‐1.  
 
   
  6.                     The ABH Group owns  interests in or operates 34 pulp and paper mills, 32
sawmills, 6 wood product facilities and 32 recycling facilities in North America and abroad, with annual revenues of about US$6.771 billion.  
 
   
  7.                     Prior to the filing of these proceedings, on February 9, 2009, ABH commenced private
offers to exchange US$1.8 billion of outstanding series of unsecured notes of BI (or a subsidiary thereof) for new notes. Concurrently, ABH solicited consents to amend the indentures governing these notes and BI offered eligible noteholders to
participate in an offering of new secured notes. These transactions, which would have resulted in a substantial de-leveraging and recapitalization of BI, Bowater Newsprint South LLC ("BNSLLC") and their respective subsidiaries
(collectively the "BI Group"), were not completed as an insufficient number of notes were tendered and expired on April 1, 2009. ABH has since then evaluated other restructuring alternatives and held discussions with BI
Group debtholders and other stakeholders to restructure the BI Group's debt.  
 
   
 
   
  8.                     On March 13, 2009, this Court granted an interim order under sections 192 and 248 of
the Canada Business Corporations Act (the "CBCA") in favor of ACI and certain affiliated applicants in connection with a proposed plan of arrangement which, if approved, would have resulted in a reduction of net debt by
almost US$2.4 billion in favor of ACI and its subsidiaries (the "ACI Group"). While the implementation of the arrangement as originally proposed was conditioned upon the successful completion of BI's exchange offers described
above, in the interest of the ACI Group and its stakeholders, ABH and the ACI Group decided to continue the ACI Group recapitalization with such modifications as necessary to take into account the developments on the BI Group refinancing. 

 
   
  9.                     ABH has now determined that it will be unable to pursue an alternative restructuring of
the BI Group without significant additional discussion and negotiation with its debt holders. As a result, it is not possible to establish the time frame within which the ACI Group's recapitalization could reasonably be completed, nor the
amended terms on which it could be proposed.  
 
   
  10.                 In addition, the ABH Group is now experiencing a liquidity shortfall and no longer has
the ability to meet its obligations as they become due and has become insolvent.  
 
   
  11.                In particular, the ABH Group currently faces significant near-term
liquidity challenges. As of M arch 31 , 2009, ABH had in excess of $ 181  million 
in trade payables.  
 
   
  12.                In addition, as of  March 31 , 2009, total
short-term bank debt, current notes payable and current installments of long-term debt exceeded US$658 million. Significant past or upcoming debt maturities primarily of Abitibi and Bowater consist of: 
  
   
 (a)                 ACCC's Term Loan Facility (as defined below) due March 30, 2009 (about US$ 349.8
 million outstanding as of  March 31 , 2009); (b)                  about US$8 million in 7.875% Notes due August 1, 2009 issued by Abitibi-Consolidated of Finance
L.P.;  (c)                  BI's Canadian Credit Facility due
June 5, 2009 (US$ 61.1  million plus accrued interest outstanding as of  March 31  , 2009); and
 (d)                  about US$251.8 million in BI 9%
debentures due August 1, 2009.    
  13.                 Due to the financial situation of the ABH Group:  
 

   
 (a)                  on  April 16  , 2009, ABH, BI and certain of their direct and indirect subsidiaries listed in Schedule "E" hereto (the "U.S. Debtors")
commenced reorganizing cases by filing voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code seeking creditor protection in the U.S. Bankruptcy Court for the District of Delaware (the "U.S. Bankruptcy
Court"). The U.S. Debtors will be requesting that their reorganization cases (the "U.S. Proceedings") be jointly administered by the U.S. Bankruptcy Court;  (b)                  the 18.6 Petitioners seek, inter alia, the recognition in Canada of the automatic statutory stay of
proceedings resulting from its filing of a voluntary Petition for relief under Chapter 11 of the U.S. Bankruptcy Code and will be seeking recognition of interim and final orders from the U.S. Bankruptcy Court approving the BI DIP Facility (as
defined below);  (c)                  the Bowater Petitioners
seek protection of this Court under the CCAA. Save for Bowater Canadian Forest Products Inc., Bowater Canada Finance Corporation, BCHI, Bowater Canadian Limited, AbitibiBowater Canada Inc., Bowater LaHave Corporation and Bowater Maritimes Inc.
(collectively, the "Dual Petitioners") , the  Bowater Petitioners  are not debtors in the U.S. Proceedings.; (d)
                  the Abitibi Petitioners seek protection of this Court under the CCAA and request an order from
this Court continuing under the CBCA and the CCAA, the above-mentioned proceedings commenced by ACI and certain affiliates on March 13, 2009 under the CBCA; and  (e)                   ACI and Abitibi-Consolidated Company of Canada ("ACCC") intend to seek recognition of
the proceedings described in section (d) in the U.S. by filing petitions under Chapter 15 of the U.S. Bankruptcy Code.    
  14.                 The consolidation of proceedings in respect of the Abitibi
Petitioners and the Bowater Petitioners in this Petition is for administrative purposes only and shall not effect a consolidation of the assets and property of the Abitibi Petitioners and Bowater Petitioners, including for the purposes of any plan
or plans of arrangement that may be hereafter proposed. Unless provided in the order sought herein, the Abitibi Petitioners and the Bowater Petitioners will continue to maintain their separate property and assets.  
 
   
  15.                 The U.S. Proceedings and these CCAA proceedings are required to provide the ABH Group and the Petitioners with the
stability they require to arrange financing, pay their obligations as they become due and owing, maintain key contracts and continue ongoing efforts to restructure operations.  
 
   
  16.                The ABH Group has, at this stage, decided not to seek court protection for the subsidiaries of the ABH Group operating in Europe and Asia and  certain other partly owned subsidiaries . The ABH Group will let these subsidiaries operate in the normal course, to the fullest extent possible and advisable, and support same with available liquidities. 
  
 
   
   
  17.
                 Unless expressly provided to the contrary, any reference herein to monetary amounts refers to
Canadian dollars.  
 
  2.                     ABH GROUP'S STRUCTURE 
  2.1.               ABH 
   
  18.                A chart
illustrating the complete corporate structure of the ABH Group and the filing proceedings undertaken for each entity is communicated as  Exhibit R- 2 . 
  
   
  19.                 On October 29, 2007, ACI and BI agreed to combine in an all-stock merger of equals to create ABH (the
"Combination").  
 
   
  20.                 The Combination was effected by means of a merger under Delaware law and a plan of arrangement pursuant to
section 192 of the CBCA.  
 
   
  21.                 ABH is a corporation incorporated under the laws of the state of Delaware, with its headquarters and executive
offices located in Montréal, Québec. ABH is a holding company and has no significant operations of its own. Instead, it conducts its business through its direct subsidiaries: ACI, BI, BNSLLC, Abitibi-Bowater US Holding LLC
("ABUSH") and their respective subsidiaries.  
 
   
  22.                 The business of the ABH Group is comprised of the businesses of
the ACI Group, the BI Group and the DCorp Group, each of which is described separately below.  
 
   
  2.2.               The ACI Group 
   
  23.               
A chart illustrating the corporate structure of the ACI Group and providing information on the indebtedness of certain entities therein is communicated as  Exhibit R‐ 3 . 
  
   
  2.2.1.          ACI 
   
  24.               
 ACI is a CBCA corporation having its head office in Montréal, Québec, resulting from the 1997 amalgamation of Abitibi-Price Inc. and Stone-Consolidated Corporation under the CBCA. ACI and its
successors have been operating in North America since the 1910s.  
 
   
  25.                 In 2000, ACI acquired all of the shares of Donohue Inc., a major
Canadian integrated forest products company engaged in forest management and in the manufacturing and sale of newsprint, specialty papers, market pulp and wood products with mills located in Québec, Ontario, British Columbia and Texas. 

 
   
  26.                 ABH holds 82% of the shares in the share capital of ACI. AbitibiBowater Canada Inc. ("ABCI"), an
indirect wholly-owned subsidiary of BI, itself a wholly-owned subsidiary of ABH, holds the remaining 18%.  
 
   
  27.                 ACI is the parent
company of all the entities which formed part of the ACI Group prior to the Combination, except for those which currently form part of the DCorp Group (as defined hereunder).  
 
   
 
   
  2.2.2.          ACCC 
   
  28.                 ACCC is a Québec company having its head office in Montréal, Québec. ACCC
is wholly owned by ACI and owns, directly or indirectly, 16 pulp and paper mills and most of the operating assets of the ACI Group in Canada.  
 
   
  29.               
 ACCC is the result of the 1997 merger of Donohue Forest Product Inc. and Donohue Quno Inc. under Part 1A of the Québec Companies Act. While on April 8, 2009, the Québec National
Assembly adopted Private Bill 202 "an Act Respecting Abitibi-Consolidated Company of Canada" which authorizes ACCC to apply for continuance under the CBCA, given the current proceedings ACCC will defer to a later date its
possible continuance under that Act.  
 
   
  2.2.3.          Other Operating Entities 
   
  30.                 Saguenay Forest
Products Inc. ("Saguenay Products") is a Québec company having its head office in Laterrière, Québec. ACCC holds a 86% equity interest in the company and all of the voting shares of the company. The company owns
sawmills located in Petit-Saguenay, Laterrière and St Fulgence, Québec.  
 
   
  31.                 The International Bridge and Terminal Company ("The
International Bridge") is a company created under a federal statute of Canada having its chief executive office in Montréal, Québec. The company is wholly owned by ACCC and holds a 50% stake in a bridge located in Fort-Frances
International Falls, the other 50% interest in the bridge is owned by a U.S. subsidiary of Boise-Cascade Inc. ("Boise"), an entity that is not part of the ABH Group.  
 
   
  32.               
 Marketing Donohue Inc. ("MDI") is a Québec company having its head office in Montréal, Québec. The company is a wholly-owned subsidiary of ACI. The company is engaged in the sale
of wood products for the ACI Group.  
 
   
  33.
                Terra Nova Explorations Ltd. ("Terra Nova") is a Québec company having its head office
in Montréal, Québec. The company is wholly owned by ACCC and is used from time to time for maritime bulk shipping tax logistics purposes.  
 
   
  2.2.4.         
Financing and Holding Entities
     
  34.                 Abitibi-Consolidated Nova Scotia Incorporated ("ACNSI") is a Nova Scotia company having its head
office in Halifax, Nova Scotia. It is wholly owned by ACCC and is the general partner of Abitibi-Consolidated Finance LP ("ACFLP"). ACFLP is a Delaware limited partnership, the limited partner of which is ACCC. ACFLP is the
issuer of US$250 million in 7.875% Notes due August 1, 2009 (referred to below).  
 
   
  35.                 The Jonquière
Pulp Company ("Jonquière Pulp") is a company created under a Québec provincial statute having its head office in Montréal, Québec. The company is a wholly-owned subsidiary of ACCC and owns lands and rights for
the ACI Group's Saguenay operations.  
 
   
 
   
  36.                 Scramble Mining
Ltd. ("Scramble") is an Ontario corporation having its registered office in Toronto, Ontario. The corporation is wholly owned by ACCC and owns mining lands.  
 
   
  37.               
 3834328 Canada Inc. ("3834328") is a CBCA corporation having its registered office in Montréal, Québec. It is a holding corporation which is wholly owned by ACI and holds two
preferred shares of ACCC.  
 
   
  38.                 1508756 Ontario Inc. ("1508756") is an Ontario corporation having its head office in Thorold,
Ontario. The corporation is wholly owned by ACCC and is the nominee for the Thorold paper mill owned by ACCC.  
 
   
  39.                
Abitibi-Consolidated Canadian Office Products Holdings Inc. ("ACCOPHI") is a CBCA corporation having its registered office in Toronto, Ontario. The corporation is wholly owned by ACI and is the sole shareholder of Tenex Data Inc., a
Delaware corporation.   
 
   
  2.2.5.
         Non-Operating Entities 
   
  40.                 3224112 Nova Scotia Limited ("3224112") is a
Nova Scotia limited company having its registered office in Halifax, Nova Scotia. 3224112 is wholly-owned by ACCC. The company has no activities and has been liquidated.  
 
   
  41.               
 La Tuque Forest Products Inc. is a Québec company having its head office in La Tuque, Québec. It is wholly owned by ACCC. The company has no activities and has been liquidated.  
 
   
  42.                 3217925 Nova Scotia Company is a Nova Scotia company having its registered office in Halifax, Nova Scotia. It is a
holding company which is wholly owned by ACCC, has no activities and has been liquidated.  
 
   
  43.                 9150-3383
Québec Inc. is a Québec company having its head office in Saint-Raymond, Québec. The company is wholly owned by ACCC, has no activities and has been liquidated.  
 
   
  44.               
 Donohue Recycling Inc. ("DRI") is an Ontario corporation having its registered office in Montréal, Québec. The corporation is wholly owned by ACCC and currently has no activities.
 
 
   
  45.                 6169678 Canada Inc. ("6169678") is a CBCA corporation having its registered office in Grand
Falls, Newfoundland and Labrador. The corporation is wholly owned by ACI and has no activities.  
  
 
  46.                 4042140 Canada
Inc. is a CBCA corporation having its registered office in Montréal, Québec. The corporation is wholly owned by ACI and has no activities.  
 
  
 
  2.3.               BI Group 
   
  47.                A chart illustrating the corporate structure of the BI Group and providing information on the indebtedness of
certain entities therein is communicated as  Exhibit R‐ 4 . 
  
  
  2.3.6.          BI

   
  48.                 BI is a Delaware corporation having its chief executive office in Greenville, South Carolina. The corporation has
been operating in North America since 1938.  
  
 
  49.
                 In 1998, BI acquired the shares of Avenor Inc., an important Canadian integrated forest products
company headquartered in Montréal, Québec. The acquisition added 5 paper mills to BI's operations.  
  
 
  50.                 In 2001, BI
acquired the shares of Alliance Forest Products Inc., a company head quartered in Montréal, thereby adding 10 Canadian sawmills and 3 paper mills to BI's operations.  
  

  51.               
 BI directly or indirectly holds most of the U.S. operating assets of the ABH Group with the exception of those held by the DCorp Group and by BNSLLC and its subsidiaries.  
  
 
  2.3.7.       
  BNSLLC 
   
  52.                BNSLLC is a Delaware company having its registered office in Wilmington, Delaware.
It is a holding company which is wholly owned by ABH and indirectly holds, through its subsidiaries Bowater Newsprint South Operations LLC and Bowater Alabama LLC, the following: (a) the Coosa Pines
Paper Mill, (b) the Grenada Paper Mill, (c) the Goodwater Planer Mill, (d) equity in Coosa Pines Golf Club Holdings LLC, which owns a golf course and (e) the currently idled Westover Sawmill. 
  
  
  2.3.8.          BCFPI 
   
  53.                Bowater Canadian Forest Products Inc. ("BCFPI") is a Nova Scotia company
having its registered office in Halifax, Nova Scotia. It is  wholly owned by ABCI. The company, in addition to operating paper-manufacturing sites in Canada and a paper-manufacturing site in Korea, manages 14 million acres
of Crown-owned land in Québec, New Brunswick and Ontario, where it holds cutting rights. It also supplies wood to paper mills and sawmills in Canada and is responsible for the marketing and sales of Canadian lumber products .  
  
  
  54.
                BCFPI directly or indirectly holds a substantial portion of the Canadian operating assets of the
BI Group and is the limited partner of Bowater Canada Finance Limited Partnership ("BCFLP"), which is described below.  
 
 
   
  2.3.9.         
BMPCL 
   
  55.                 Bowater Canadian Limited ("BCL") is a CBCA corporation having its registered office in Halifax,
Nova Scotia. This holding corporation is wholly owned by BI and holds intellectual property rights as well as an equity interest in Bowater Mersey Paper Company Limited ("BMPCL").  
  
 
  2.3.10.      Other Non-Operating Entities 
   
  56.                 Bowater Maritimes Inc. is a New Brunswick company which has its registered office in Dalhousie, New Brunswick and
is wholly owned by BI.  The company is the owner of the closed Dalhousie paper mill and woodlands in Québec.  
  
 
  57.                 St-Maurice River
Drive Company is a CBCA corporation which has its head office in Trois-Rivières, Québec. The corporation is 77% owned by ACCC and 22% owned by BCFPI, it holds no assets and its operations ceased on March 31, 1999.  
 
  
  2.3.11.      Financing and Holding Entities 
   
  58.                 Bowater Canada Finance Corporation ("BCFC") is a Nova Scotia company having its registered office
in Halifax, Nova Scotia. The company is wholly owned by BI and is the issuer of the US$ 600 million in 7.95% Notes due November 15, 2011.  
  
 
  59.                 Bowater Canadian Holdings Incorporated ("BCHI") is a Nova Scotia company having its registered office in Halifax, Nova Scotia. BCHI is wholly owned by BI and is a holding company for Bowater's
Canadian activities (except for the Nova Scotia operations).  
  
 
  60.                 ABCI is a CBCA corporation having its registered office in
Toronto, Ontario. It is a holding corporation which is wholly owned by BCHI and owns an 18% equity interest in ACI.  
  
 
  61.                 Bowater Canada
Treasury Corporation ("BCTC") is a Nova Scotia company having its registered office in Halifax, Nova Scotia. The company is wholly owned by BCHI and is the general partner of BCFLP, a New Brunswick limited partnership having its
chief executive office in Fredericton, New Brunswick. BCFLP is used for financing activities and its limited partner is BCFPI.  
  
 
  62.                 Bowater Shelburne
Corporation is a Nova Scotia company having its registered office in Halifax, Nova Scotia. The company is wholly owned by BCFLP and has no activities.  
  
 
  63.                 Bowater LaHave Corporation ("Bowater LaHave") is a Nova Scotia company having its registered office in Halifax, Nova Scotia. The company is wholly owned by BCFPI and is the holding company of
Bowater-Korea Ltd., which owns the Mokpo mill located in South Korea.  
  
 
  64.                 Bowater Pulp and Paper Canada Holdings Limited Partnership is a
New Brunswick limited partnership having its registered office in Fredericton, New Brunswick. The general partner of the partnership is Bowater Ventures Inc. ("BVI"), a Delaware corporation owned by BI, and its limited partner is
BI. The partnership is a financing vehicle.  
 
  
 
  2.3.12.      Non-Operating Entities 
   
  65.                 Bowater Mitis Inc. is a Québec company having its registered
office in Price, Québec. The company is wholly owned by BCFPI, has no activities and has been liquidated.  
  
 
  66.                 Bowater
Guérette Inc. ("BGI") is a Québec company having its registered office in Dégelis, Québec. The company is wholly owned by BCFPI, has no activities and has been liquidated.  
  
 
  67.                 Bowater Couturier Inc. is a New Brunswick company having its registered office in Baker Brook, New Brunswick. The
company is wholly owned by BGI, has no activities and has been liquidated.  
  
 
  68.                 Alliance Forest Products Inc. (2001) Inc. is a CBCA corporation
having its registered office in Montréal, Québec. The corporation is wholly owned by BCFPI, holds no assets and is currently inactive.  
  
 
  69.                 Bowater Belledune Sawmill Inc. is a CBCA corporation having its registered office in Toronto, Ontario. The corporation is wholly owned by BCFPI, holds no assets and is currently inactive.  
 
  
  70.                 Bowater Treated Wood Inc. is a Québec company having its registered office in Dégelis, Québec. The
company is wholly owned by BCFPI, holds no assets and is currently inactive.  
  
 
  71.                 Canexel Hardboard Inc. is a CBCA corporation having its
registered office in Montréal, Québec. The corporation is wholly owned by BCFPI, holds no assets and is currently inactive.  
  
 
  72.                 3231378 Nova Scotia Company is a Nova Scotia company having its registered office in Halifax, Nova Scotia. It is wholly owned by BVI and has no assets and is not operating.  
  
 
  73.                 9068-9050 Québec Inc. is a Québec company having its registered office in Montréal, Québec.
The company is wholly owned by BCFPI, holds no assets and is currently inactive.  
  
 
  2.4.               DCorp Group 
  

  74.                The
corporate structure of ABUSH (collectively referred to, with its subsidiaries, as the "DCorp Group") is illustrated as part of the chart for the ACI Group (Exhibit R‐3 ) . 
  
  75.                 The DCorp Group has no assets or operations in Canada and none of its entities are Petitioners in the CCAA
proceedings but its activities are closely related and inter-connected with those of the ACI Group.  
 
  
 
  76.                 ABUSH is a
Delaware corporation having its registered office in Wilmington, Delaware. This holding corporation for the DCorp Group is wholly owned by ABH.  
  
 
  77.                 Donohue Corp. ("DCorp") is a Delaware corporation having its registered office in Wilmington, Delaware. It is a holding corporation which is wholly owned by ABUSH.  
  
 
  78.                 Abitibi Consolidated Sales Corporation ("ACSC") was originally incorporated in Delaware in 1956,
under the name Northeastern Paper Sales Inc., and results from the 1997 merger of Abitibi-Price Sales Corporation with Stone Consolidated U.S. Corporation. ACSC is wholly owned by DCorp and is the entity through which sales of the ACI Group to
customers located in the United States are effected.  
  
 
  79.                 ACSC directly or indirectly holds most of the U.S. operating assets of the DCorp Group,
with the exception of certain recycling facilities which are held directly or indirectly by DCorp.  
  
 
  80.                 Alabama River
Newsprint Co. ("ARNC") is an Alabama general partnership having its chief executive office in Claiborne, Alabama. ARNC owns the Alabama newsprint mill located in Perdue Hill, Alabama which has been idle since December 2008. Its
general partner is ACSC and its limited partner is Abitibi-Consolidated Alabama Corporation ("ACAC"), an Alabama corporation having its registered office in Montgomery, Alabama, which is wholly owned by ACSC.  
  
 
  81.                 Abitibi-Consolidated Corporation ("ACC") is a Delaware corporation having its registered office
in Wilmington New Castle, Delaware. The corporation is wholly owned by DCorp and is engaged in the recycling business. ACC owns recycling and sorting facilities in several U.S. cities.  
  
 
  82.                 Augusta Woodlands, LLC ("Augusta") is a Delaware limited liability company having its chief
executive office in Montréal, Québec. The company is wholly owned by ACC, has no activities and owns a tele-communication tower and piece of land.  
 
  3.                     ABH GROUP'S BUSINESS AND AFFAIRS 
  3.1.               Business of the ABH Group 
   
  83.                 The ABH Group is the largest producer of newsprint in the world, as well as a major producer of uncoated ground
wood (commercial printing) papers and wood products.  
 
  
  84.                 The ABH Group has about 15,800 employees. It owns interests in or operates 34 pulp
and paper mills, 32 sawmills, 6 wood product facilities and 32 recycling facilities in Canada, the United States, the United Kingdom and Korea.  
  
 
  85.                 ABH realized revenues of about US$6.771 billion over the twelve-month period ending December 31, 2008.  
  
 
  86.                 ABH also directly or indirectly holds equity interests in various companies operating, among other things, recycling facilities and power generation facilities.  
 
  
 
  3.2.               Business of the ACI Group 
   
  87.                 The ACI Group has
about 9,035 employees. It owns interests in or operates 18 paper mills, 23 sawmills, 6 wood product facilities and 12 recycling facilities in Canada and in the United Kingdom, the whole as appears from a table listing the ACI
Group facilities, communicated as Exhibit R-5.  
  
 
  88.                 The ACI Group also holds, directly or indirectly, equity interests in various companies
operating, among other things, power generation facilities, the most significant of which are the following:  
  
 
 (a)                  ACCC holds a 60% equity interest in Manicouagan Power
Company ("MPCo"), a joint venture with Alcoa Canada Ltée that operates a 350.38 MW hydroelectric facility situated on the Manicouagan River, Québec;  (b)                  ACCC holds a 75% equity interest in ACH Limited Partnership ("ACH"), a joint venture with
Caisse de dépôt et placement du Québec for its Ontario hydroelectric generation facilities, which encompasses eight hydroelectric facilities located in Ontario;  (c)                   ACCC holds a 51% equity interest in Star Lake Hydro Partnership ("SLHP"), a joint
venture with CHI Hydroelectric Company Inc. for its Newfoundland hydroelectric generation facilities. In December 2008, the Government of Newfoundland and Labrador announced the expropriation of Abitibi's provincial assets, including the SLHP
facilities;  (d)                  ACCC holds a 49% equity interest
in Exploits River Hydro Partnership, a joint venture with Fortis Properties Corporation for the development and operation of hydroelectric plants at Bishop's Falls and Grand Falls-Windsor in the Province of Newfoundland;  (e)                   ACI  holds a 51% equity
interest in Donohue Malbaie Inc. ("Donohue Malbaie"), a joint venture with The New York Times Company, which owns and operates a paper machine at one of Abitibi ́s newsprint mills;  (f)                    ACCC and its subsidiaries own or operate significant woodlands in
Canada;  (g)                  BCL holds a 51% equity interest in
BMPCL, a joint venture with The Washington Post Company, which owns and operates a Sawmill in Oakhill, Nova Scotia, as well as a Papermill and woodlands in Mersey, Nova Scotia.     89.                 ACCC owns and operates, through Bridgewater Paper Company Limited
("Bridgewater"), a company under the laws of England, a newsprint mill situated in Bridgewater, United Kingdom. Bridgewater is the entity through which sales are made by the ACI Group to customers located in the U.K. and in certain
European countries.  
  
 
  90.                 ACI also holds equity interests in other European companies operating, among other things, recycling facilities in
the United Kingdom.  
 
  
 
  3.3.               Business of the BI Group 
    91.               The BI Group has about 5,989 employees. It owns  
interests in   or operates 13 paper mills and 9  sawmills in the United States, Canada and
South Korea, the whole as appears from a table listing the BI Group facilities, communicated as Exhibit R-6 .  
  
 
  92.                 The BI Group has about 2,610 employees in Canada, where it owns interests in or operates 6 pulp and paper mills.   
  
  
  93.                 The BI Group also holds a 51% equity interest in BMPCL which owns a sawmill located in Oakhill, Nova Scotia, as
well as a paper mill and woodlands located in Mersey, Nova Scotia.  
  
 
  94.                 The BI Group also owns or operates significant woodlands in
Canada.  
  
 
  3.4.               Business of the DCorp Group  
   
  95.                 As previously
mentioned, the DCorp Group no longer forms part of the ACI Group. Its activities are, however, closely related to those of the ACI Group.  
  
 
  96.                The DCorp Group has about  785  employees. The DCorp Group owns interests in or operates 3 pulp and paper mills (only 1 of which is
currently in operation) and 20 recycling facilities, all of which are situated in the United States, the whole as appears from a table listing the DCorp Group facilities, communicated as Exhibit R‐7. 
  
  
  3.5.               Sales and Distribution 
   
  97.                 The ABH Group
produces various products including newsprint, specialty papers, wood pulp and wood products (collectively the "Products").  
  
 
  3.5.1.          ACI
Group 
   
  98.                 Most of the Products produced by the ACI Group are produced in mills owned directly or indirectly by ACCC. These
Products are then sold by ACCC to ACI and, in turn, ACI sells ACI Group's Products directly to customers located in Canada and outside of North America, excluding certain European countries. ACI takes legal title in the Products before they are
sold.  
  
 
  99.                 ACI sells Products directly to Bridgewater, a U.K. company owned by ACCC and in turn, Bridgewater sells ACI
Group's Products to customers in the U.K. and in the rest of Europe. Bridgewater takes legal title in the Products before they are sold.  
  
 
  100.             ACI also sells Products directly to ACSC, a Delaware corporation which forms part of the DCorp Group and in turn, ACSC sells ACI Group's Products to customers located in the United States. A significant amount of accounts receivables are
thus generated between ACI and ACSC. ACSC takes legal title in the Products before they are sold.  
 
  
 
  101.             As an exception
to the ACI Group's general sales structure:  
   
 (a)                  ACCC is a party to a contract with Boise, whereby ACCC supplies pulp to Boise's International Falls (U.S.)
facility directly from its mill in Fort-Frances, Ontario;  (b)                  ACCC is the main supplier of wood chips to SFK Pulp's St‐ Félicien pulp mill, a mill located in Québec which was previously owned by ACCC; and  (c)
                  Donohue Malbaie (a joint venture with The New York Times Company in which ACCC holds a 51%
interest) sells its Products directly to ACCC, which in turn, sells a portion of its production to the New York Times Company. Donohue Malbaie is not a Petitioner in these proceedings.    

 3.5.2.          DCorp Group 
   
  102.             The DCorp Group has only one mill currently in operation (Augusta) in the United States. The production from this mill is entirely and directly sold by Bowater America Inc. ("BAI"), in ACSC's name,
to customers located in the United States.  
  
 
  103.
             As noted above, ACSC sells the ACI Group's Products to customers located in the United States.  
  
  
  3.5.3.          BI Group 
   
  104.             Sales for the BI Group originate from Products produced by mills in the United States or by BCFPI mills in
Ontario and Québec.  
  
 
  105.             The BI Group's Products are sold directly by the entity that manufactured the Products to customers located in Canada or outside of North
America, sometimes through third-party agents or brokers.  
  
 
  106.             The BI Group's Products (except for BMPCL's Products) are also sold to BAI and in turn, BAI sells these
Products to all customers located in the United States. BAI takes legal title in the Products before they are sold.  
  
 
  107.             BMPCL's Products, a partnership with the
Washington Post, are sold to BI and in turn, BI sells these Products to customers located in the United States and outside of North America. BI takes legal title to the Products before they are sold. BMPCL sells directly its Products directly to
customers located in Canada.  
  
 
  108.             The lumber originating from BI Group sawmills is sold directly by BI producing entities to customers located in the United States and in
Canada.  
  
 
  3.5.4.          Securitization Program 
   
  109.            As described in greater detail in section  4.2.1.4  hereof, the accounts receivable of ACI and ACSC from clients which have a billing address in Canada, the U.S. or any other country outside the U.K., Belgium Ireland and Germany are sold to ACUSFC as part of the
Securitization Program (as hereinafter defined).  
 
  
  
  3.5.5.          Sales Forces and Brokers 
  110.
             The United States sales forces for newsprint and specialty papers are all employed by BAI, while the Canadian sales forces
for these Products are employed by ACCC. However, the sales force for all wood products produced by the ABH Group is centralized in ACCC.  
  
 
  111.             The ABH Group relies upon third-party brokers and agents to sell Products. Brokers and agents are relied upon to obtain new customers and to maintain long-term customer relationships for certain products. In general, such brokers and
agents are responsible for the promotion, sale, solicitation and confirmation of orders from customers, as well as for communicating with customers regarding the sales and marketing of the Products.  
 
  
  112.             For many of the brokers and agents, commissions constitute the sole source of revenue for any given sale. Thus, the majority of brokers
and agents do not receive a profit margin on any of the Products that they sell. In addition, in  many instances, no specific performance goals or quotas exist obligating the Petitioners to sell a pre-defined amount of product or to
aggressively solicit new customers. In other words, the brokers' and agents' incentive to expend effort to sell the Petitioners' Products (as opposed to someone else's product) directly links to the brokers' and agents' commission package.
Accordingly, if the brokers and agents are not paid their commissions, the brokers and agents may and can substantially reduce their sales efforts on behalf of the Petitioners because the ongoing payment of commissions constitutes their only
incentive to sell the Petitioners' Products.  
  
 
  3.6.
               Cash Management 
   
  113.             In the ordinary course of their
respective businesses the ACI Group, the BI Group and the DCorp Group use centralized cash management systems (collectively the "Centralized Cash Management System") to collect funds and pay expenses associated with their
operations.  
  
 
  114.             The ABH Group's treasury department ("Treasury"), situated in Montréal, exercises primary oversight of the
Centralized Cash Management System. By centralizing control over cash management in Montréal, the ABH Group is able to facilitate cash forecasting and reporting, monitor collection and disbursement of funds, and maintain control over the
administration of various bank accounts required to effect the collection, disbursement and movement of cash.  
  
 
  115.             The ABH Group administers its Centralized
Cash Management System along the lines of the historical practices of each of the BI Group and ACI Group. As a result, two essentially separate but centrally controlled systems funnel revenue from the ACI Group (including to a certain extent, the
DCorp Group) and the BI Group into separate concentration accounts, from which disbursements are made to cover each group's separately incurred costs. The ACI Group's cash management system and the DCorp Group's cash management system (collectively
the "ACI Cash Management System") are, to a certain extent, integrated and interrelated and operate independently from the BI Group's cash management system (the "BI Cash Management System"). Transfer pricing
mechanisms and intercompany agreements exist to allocate the costs within and across each group and to ABH, the ultimate parent.  
 
  
 
  116.             The Centralized Cash Management System is similar to those commonly employed by multinational enterprises of similar size and complexity as the ABH Group. Substantially disrupting the Centralized Cash Management System would impair the
Petitioners' and certain of its joint ventures' ability to carry on business, as they presently have no cash management or payables systems of their own.  
  
 
  117.             The ABH Group will continue to maintain accurate and current records with respect to all transactions, whether transfers of cash, setoffs or otherwise, so that all transactions can be readily ascertained, traced and properly recorded on
applicable intercompany accounts. The ABH Group's inability to continue using the Centralized Cash Manage ment Systems would severely, and perhaps irreparably, disrupt the ABH Group's operations.  
  
 
  118.             Ernst & Young Inc., the proposed Monitor, has reviewed the Centralized Cash Management System and will be able to adequately
monitor the transfers of cash, including transfers within the Centralized Cash Management System, so that trans actions applicable between the ACI Group, the BI Group and the DCorp Group can be ascertained, traced and recorded properly on applicable
intercompany accounts.  
  
 
  3.6.1.          The BI Group Cash Management System 
    119.
            A diagram outlining the general movement of funds within the BI Cash Management System is communicated as  Exhibit R‐8.
 
  
 
  120.             The BI Group conducts its principal treasury functions in Montréal on a group-wide basis. The BI Group manages its cash primarily
through three concentration accounts: (a) one with Wachovia Bank, National Association ("Wachovia") for United States operations (the "Wachovia Concentration Account"); and (b) two with Bank of Montreal
("BMO") for Canadian operations (these two separate accounts are denominated in US and Canadian dollars respectively and comprise the BMO concentration accounts (the "BMO Concentration Accounts")).  
  
 
  121.             The BI Group's United States receivables are collected primarily through a network of lockboxes aligned with its various product lines
(pulp, paper and wood) and centralized in the Wachovia Concentration Account. Disbursements, in turn, are made for the most part directly from the concentration accounts or funneled through separate bank accounts maintained at other institutions.
The Wachovia Concentration Account also receives some direct deposits and wire transfers from the BI Group's United States customers, as well as customer payments from anywhere in the world made in electronic form and remitted from BAI's bank
account with JP MorganChase Bank N.A.  
  
 
  122.
            The BI Group uses the Wachovia Concentration Account (along with a separate bank account at Wells Fargo Bank, N.A. used for cheque
writing purposes) for the majority of its significant disbursements in the United States.  
 
  
 
  123.             Similarly, the BI Group's Canadian
receivables, including transfers from BI to its Canadian subsidiary, BCFPI, to fund Canadian operations, are centralized in the BMO Concentration Accounts from which the BI Group makes disbursements to fund Canadian operations.  
  
 
  3.6.2.       
  The ACI Group and the DCorp Group Cash Management System  
   
  124.             Diagrams outlining the general movement of funds within the ACI Cash Management System and DCorp Cash
Management System are communicated as Exhibit R‐9.  
  
 
  125.             The ACI Group conducts its principal treasury functions in Montréal on a group-wide
basis. The ACI Group's cash management system functions through a series of lockboxes, lockbox accounts and concentration accounts designed to centralize and regulate the flow of cash among various corporate entities. The ACI Group has monetized
substantially all of its accounts receivable and most of its principal lockbox accounts for collecting customer payments are therefore subject to controlled account agreements with Citibank, N.A. ("Citibank").  
  
 
  3.6.2.1.             Securitization Accounts 
   
 
126.            As described in greater detail in section 4.2.1.4
 hereof, ACI and ACSC are parties to a two-level receivables Securitization Program (as defined below). Accounts receivable sold by ACI and ACSC to ACUSFC under the Securitization Program are collected
through six separate lockbox accounts in the name of ACI or ACUSFC which are subject to control agreements in favour of Citibank as Agent under the Securitization Program. These accounts and the amounts deposited therein are owned by ACUSFC.
Pursuant to the terms of the Securitization Program, the funds in the lockbox accounts are released on a daily basis, first to pay various expenses related to the Securitization Program, and then, subject to the satisfaction of conditions precedent
and the maintenance of certain reserves, to purchase additional Receivables from ACI and ACSC. Funds from the lockbox accounts are transferred daily into two accounts controlled by Citibank that serve to concentrate deposits from receivables in U.S.
and Canadian dollar accounts. 
  
  
  (i)                    Canadian Dollar Lockbox Accounts 
   
  127.             Two lockbox accounts exist for collecting payments from ACI's Canadian customers in Canadian dollars, one for paper sales and the other for wood products sales, both of which are maintained with RBC. Deposits into
these accounts are transferred daily into a joint account held by ACI with Citibank's Toronto branch (the "Citi Toronto Securitization Account"). As additional receivable purchases are made under the Securitization Program, Citibank
transfers funds directly from the Citi Toronto Securitization Account into the ACCC Cdn$ Treasury Account (as defined below).  
  
 
  (ii)                  U.S. Dollar Lockbox Accounts 
   
  128.             Four lockbox accounts exist for the collection of U.S. dollar accounts receivable. ACUSFC, the special purpose entity under the
Securitization Program, owns two lockbox accounts with Bank of America, one for paper sales and the other for wood products sales. Both accounts are designed to collect customer payments in U.S. dollars on the accounts receivable sold to ACUSFC by
ACSC under the Securitization Program. ACI also maintains a lockbox account for U.S. dollar receivables with RBC in Montréal for payments made by ACI's Canadian customers in U.S. dollars, and ACUSFC maintains a lockbox account with Citibank's
New York branch for collection of receivables from international sales (excluding the U.K. and Europe).  
 
  
 
  129.             Payments into U.S. dollar lockbox
accounts are concentrated into ACUSFC's Citibank New York Branch lockbox account (the "Citi US Securitization Account"), which serves as the equivalent of the Citi Toronto Securitization Account and collects payments in U.S. dollars
subject to the Securitization Program. As additional receivable purchases are made, Citibank transfers funds directly from the Citi U.S. Securitization Account into the ACI Concentration Account (as defined below).  
  
 
  3.6.2.2.             U.S. Operating Accounts 
   
 
130.             The ACI Group uses three principal U.S. concentration accounts in U.S. dollars,
one each in the name of each of ACC, ACSC and ACI, as well as a U.S. dollar treasury account with Bank of America in ACCC's name.  
 
   
  (i)                    ACC 
    131.             The ABH Group conducts its recycling operations through ACC. ACC maintains a concentration account (the
"ACC Concentration Account") with Bank of America.  
 
    132.             Deposits into the ACC Concentration Account come from: (a) recycling customer receivables collected through a lockbox held with Bank
of America in Chicago; and (b) intercompany funding transfers from the ACSC Concentration Account (as defined below).  
 
    133.             ACC uses the ACC Concentration Account for funding accounts payables arising from its
recycling operations. It makes such payments through the use of two accounts in its name also held at Bank of America. Excess cash (if any) in the ACC Concentration Account is transferred to the ACSC Concentration Account as defined below. 

 
   
  (ii)                  ACSC 
    134.             ACSC historically employed what is now the BI Group's United States sales force. Since the Combination,
however, the ABH Group has centralized its sales force under BAI, which now employs almost all of the North American sales and customer service representatives. As noted above, under the ABH Group's intercompany transfer pricing arrangements, ACSC
continues to be the entity through which the products are sold by the ACI Group and DCorp Group to customers located in the United States. ACSC maintains a concentration account with Bank of America (the "ACSC Concentration
Account").  
 
    135.             Deposits into the ACSC Concentration Account consist primarily of transfers from the ACC Concentration Account, but also include miscel
laneous deposits from the Augusta mill operations and intercompany transfers from the ACI Concentration Account (as defined below).  
 
 
    136.             Transfers from the ACSC Concentration
Account include: (a) payments on account of certain mill and wood products operations (including for purchases from Augusta Newsprint Company); and (b) transfers to the ACC and ACI Concentration Accounts. ACSC pays its U.S. dollar payables
from two accounts held in its own name at Bank of America. Excess cash (if any) is transferred to the ACI Concentration Account on a daily basis.  
  
 
  (iii)             
  ACI 
   
  137.             ACI historically functioned as a holding company. Aside from selling the ACI Group's products to customers located in Canada and outside
of North America, excluding certain European countries, it has no operations of its own. It maintains a United States concentration account (the "ACI Concentration Account") at Bank of America for purposes of managing cash flow
within the United States and ultimately, to channel funds to Canada.  
  
 
  138.             Deposits into the ACI Concentration Account originate principally from the Citi US
Securitization Account and also include intercompany transfers from the ACSC Concentration Account.  
  
 
  139.             Transfers from the ACI Concentration
Account include: (a) daily sweeps of excess cash into an overnight investment account with Bank of America; and (b) transfers of cash to the ACCC US Treasury Account (as defined below).  
  
 
  (iv)                ACCC 
   
  140.           ACCC maintains  a U.S. dollar A/P account as well as a US treasury
account at Bank of America (the "ACCC US Treasury Account"). 
  
  
  141.           Deposits into the ACCC US Treasury Account include transfers from the ACI Concentration Account, while ACCC makes all U.S. dollar
electronic fund transfers for its Canadian legal entities from the ACCC US Treasury Account. ACCC also makes intercompany transfers from the ACI Concentration Account to its Canadian treasury account through the ACCC US Treasury Account. 

 
  
  3.6.2.3.             Canadian Operations  
   
  (i)                   
ACCC 
   
  142.             Funds released from the Citi Toronto Securitization Account flow into a principal operating account held in ACCC's name with RBC (the
"ACCC Cdn$ Treasury Account").  
  
 
  143.             Transfers from the Securitization Program coming from the Citi Toronto Securitization Account constitute the
principal deposits into the ACCC Cdn$ Treasury Account. Deposits also include transfers from (a) the ACCC US Treasury Account; and (b) certain CIBC accounts upon conversion of U.S. dollar or other non-Canadian currency transfers into
Canadian dollars. Transfers into the CIBC foreign currency exchange accounts include transfers from the ACCC US Treasury Account and the Company's European operations.  
 
  
 
  144.             The ACCC Cdn$ Treasury Account is the Abitibi Group's principal operating account and is used for most payables arising from its Canadian operations, including payroll. Transfers are made from the ACCC Cdn$ Treasury Account to a variety of
additional accounts with RBC (the "RBC Funding Accounts") that serve accounts payable or payroll functions. The Company transfers money into the RBC Funding Accounts on an "as needed" and generally daily basis. 
Excess amounts in the RBC Funding Accounts are transferred back into the ACCC Cdn$ Treasury Account.  
  
 
  145.             ACCC also maintains a U.S. dollar account
in Canada with RBC (the "ACCC US$ RBC Account").  Historically a concentration account for collecting U.S. dollar receivables, the ACCC US$ RBC Account now serves a much more limited function. Inflows include principally
intercompany transfers from the United States (specifically, from the ACCC US Treasury Account) that are transferred through ACCC's two accounts with CIBC in connection with foreign currency conversion functions. Outflows include transfers to ACI's
U.S. dollar treasury account in Canada with RBC. Also historically a concentration account for collection of U.S. dollar receivables, ACI's U.S. dollar RBC account now serves as a back-up account for U.S. dollar wire transfers in Canada, and
otherwise has very limited activity.  
  
 
  (ii)                  ACI 
   
  146.             ACI maintains a Canadian dollar treasury account with RBC. Deposits into this account include all Canadian non-accounts receivable payments (in Canadian dollars) arising from ACI's operations. Such deposits may
comprise, for example, government rebates, miscellaneous proceeds from non-material asset sales in Canadian dollars, and similar transactions. Outflows from the ACI Canadian dollar treasury account are principally into the ACCC Cdn$ Treasury
Account.  
  
 
  3.6.3.          Intercompany Transactions 
    147.             In the normal course of business, entities in the ABH Group engage in various intercompany transactions. As a result, at any given time,
numerous intercompany transactions exist (the "Intercompany Transactions") that reflect intercompany payments and receivables made in the ordinary course among ABH Group entities (the "Intercompany Claims"). These
Intercompany Transactions include, but are not limited to:  
 
   (a)                  Accounts Receivable, Accounts Payable, and Payroll  : In their day to day
operations, entities in the ABH Group contribute cash and process disburse ments through the Centralized Cash Management System described above. The system is generally integrated along ACI Group and BI Group lines. Where receipts are collected into
and disbursements are paid from the concentration accounts maintained by BI, ACC, ACI and ACCC, corresponding Intercompany Claims arise among BI, ACC, ACI, ACCC and the applicable ACI Group or BI Group entity. Also in the ordinary course of
business, entities in the ABH Group collect cash and disburse funds on behalf of other entities within the corporate group. The Petitioners' accounts reflect the net position of both receipts and disbursements received or made on behalf of each
Petitioner.  
  
 (b)                  Centrally Billed Expenses  : In the ordinary course of business, entities in the ABH Group incur centrally billed expenses. These include, for example, centralized invoicing for raw materials (e.g., wood
chips bought from third parties, chemicals etc.) and freight and distribution costs, as well as certain employee medical costs, insurance premiums, accounts payable processing, certain taxes (including real estate, franchise, sales taxes, etc.) and
leased equipment. To illustrate, the ABH Group has centralized many of its shipping and warehousing expenses. These charges are allocated among the Petitioners and the U.S. Debtors and are reflected in the intercompany accounts.  (c)                   Corporate Expense Allocation 
: Charges for corporate expenses provided by ABH to the Petitioners and to the U.S. Debtors are allocated among the Petitioners, the U.S. Debtors and ABH based upon the cost of service provided, directly identifiable costs, and other
allocation methods.  (d)                  Intercompany Purchases and Centralized Sales  : The ABH Group's sales and customer service representatives in the United States are employed by BAI. This team sells product in the United States on behalf of the
entire corporate group. As a result, in the ordinary course of business, certain entities in the ABH Group purchase and sell products to or on behalf of other entities. For example, BAI sells wood products manufactured by BCFPI to BAI's United
States customers. Once sold and invoiced to a United States customer in its own name, BAI purchases the lumber products from BCFPI via BI. The prices for such purchases are typically determined by BI and BCFPI based on the prices applicable to third
parties that purchase similar products from BCFPI on an arm's length basis.  (e)                
  Sales by ACI to ACSC  : As mentioned previously, ACI sells Products directly to ACSC, which in turn sells ACI Group's Products to customers located in the United
States.     148.             The
Petitioners maintain records of Intercompany Transactions and can ascertain, trace and account for Intercompany Transactions between and among the Petitioners, between and among the Petitioners and the U.S. Debtors, and among the Petitioners, the
U.S. Debtors and their affiliates. The significant intercompany relationships are generally documented by intercompany agreements and notes.  
 
    149.             To ensure that each individual Petitioner
or U.S. Debtor will not fund, at the expense of its creditors, the operations of another entity, the Petitioners seek the granting of the priming charges described in the conclusions of this Petition and the U.S. Debtors will seek the approval of
the U.S. Bankruptcy Court to accord administrative expense status to all Intercompany Claims against a U.S. Debtor by another Petitioner, U.S.Debtor, or a non-debtor affiliate arising from an Intercompany Transaction after the effective time of the
Initial Order sought herein or the filing of the U.S. Proceedings. If all Intercompany Claims are accorded a priming charge (in Canada) or administrative expense priority status (in the U.S.), each entity will continue to bear ultimate repayment
responsibility for these ordinary course transactions.  
 
 
   
  3.7.               Employees 
   
150.             As of December 31, 2008, the ABH Group employed about 15,809 active
employees, of which 11,268 work in Canada and 3,922 work in the United States.  The ABH Group also has 619 employees in Europe and South Korea.  
 
 (a)                  of the 11,268 employees in Canada, about 8,996 are covered by collective
bargaining agreements. As of December 31, 2008, 2,272 employees of the ABH Group's mills and related facilities in Canada, including those in the corporate headquarters in Canada, are non-unionized. Of the total number of employees in
Canada, 613 employees are directly employed by joint ventures or partnerships which will not be included as part of the Canadian CCAA proceedings;  (b)                  of the 3,922 employees in the United States, about 2,275 are covered by collective bargaining
agreements. As of December 31, 2008, 1,647 employees of the ABH Group's mills and related facilities in the United States, including those in corporate offices in the United States, are non unionized. Of the total number of employees in
the United States, 532 employees are directly employed by joint ventures which will not be included as part of the U.S. Chapter 11 proceedings; and  (c)                   of the 619 employees in Europe and South Korea, about 442 are covered by collective bargaining
agreements. As of December 31, 2008, 177 employees of the ABH Group's mills and related facilities in Europe and in South Korea are non unionized.     151.             Schedules providing a breakdown per location of the ABH Group employees are communicated, en liasse, as
Exhibit R‐10.  
 
    152.             The ACI Group's gross payroll obligations (salaried and hourly) for the fiscal year 2008 were approximately $  287.4   million; and the aggregate gross payroll obligations of the Canadian entities of the BI Group (salaried and hourly) for the same period were approximately $  99.3   million.  
 
    153.             The ACI Group and the BI Group also offer benefits to their eligible salaried and hourly employees, including through group insurance
programs. The total amounts paid by the ACI Group for benefits (including current pension contributions and OPEB payments ) for hourly and salaried employees during 2008 totalled approximately $  133.9   million, while hourly and salaried benefits (including current pension contributions and OPEB payments) paid by the Canadian entities of the BI Group totalled $  46   million.  
 
 
    154.             The ABH Group's employees are paid on a periodic basis customary for the jurisdiction in which they work and the ABH Group's employers are
current in the payment of benefits and vacation pay to their respective employees. Deductions from employee salaries are made, as required by the various jurisdictions, and these deductions are remitted to the appropriate governmental authorities,
where applicable.  
 
  4.                     FINANCIAL SITUATION AND STRUCTURE 
  4.1.               Financial results 

  4.1.1.          ABH 
    155.             For the fiscal year ended September 30,
2008, ABH recorded a net loss of about US$801 million. ABH's sales for this period were about US$  5,154   billion, the whole as appears from interim consolidated financial
statements of ABH for the nine-month period ended September 30, 2008, communicated as Exhibit R-  11 . 
  

  
  4.1.2.          The ACI Group 
    156.             For the fiscal year ended December 31, 2005, the ACI Group (which included the DCorp Group) recorded a net loss of $276 million. The ACI Group's revenues for 2005 were $5.34 billion, compared to $5.30 billion for 2004.
 
 
    157.             For the fiscal year ended December 31, 2006, the ACI Group (which included the DCorp Group) recorded net earnings of $54 million. The ACI Group's revenues for 2006 were $4.85 billion.  
 
    158.             For the fiscal year ended December 31, 2007, the ACI Group (which included the DCorp Group) recorded a net loss of $693 million. The ACI Group's revenues for 2007 were $4.1 billion.  
 
    159.             For the nine-month period ended September 30, 2008, the ACI Group (which included the DCorp Group until March 31, 2008) recorded a net loss of $1.06 billion. The ACI Group's revenues for the same
period were $2.584 billion, the whole as appears from interim consolidated financial statements of ACI for the nine-month period ended September 30, 2008, communicated as Exhibit R-   12   .  
 
   
  4.1.3.          The BI Group 
    160.
             For the fiscal year ended December 31, 2005, the BI Group recorded a net loss of US$120.6 million. The
BI Group's sales for 2005 were US$3.48 billion, compared to US$3.19 billion for 2004.  
 
    161.             For the fiscal year ended December 31, 2006, the BI Group recorded a net loss of US$138 million.
The BI Group's sales for 2006 were US$3.53 billion.  
 
    162.             For the fiscal year ended December 31, 2007, the BI Group recorded a net loss of US$491 million. The BI Group's sales
for 2007 were US$3.21 billion.  
 
 
    163.             For the nine-month period ended September 30, 2008, the BI Group recorded a net loss of US$294 million. The BI Group's
revenues for the same period were US$2.524 billion, the whole as appears from interim consolidated financial statements of BI for the nine-month period ended September 30, 2008, communicated as Exhibit R-   13
   .  
 
    164.             For the nine-month period ended September 30, 2008, BCFPI and its subsidiaries recorded a net loss of $  385
   million. The revenues of BCFPI and its subsidiaries for the same period were $  916  million, the whole as appears from interim
consolidated financial statements of BCFPI for the nine-month period ended September 30, 2008, communicated as Exhibit R-  14 . 
  
   
  4.2.               Indebtedness 
   
  4.2.1.          The ACI Group Indebtedness 
    165.            In addition to trade debts, the principal
debt obligations of the ACI Group currently outstanding consist of credit facilities and public debt obligations. In addition, Abitibi is party to a securitization program. The indebtedness of the ACI Group as of 
March 31, 2009  included the following: 
  

	  
Senior Notes  
	   US$431 million  

	   Term Loan  
	   US$  349.8 million 

	   Public debt obligations  
	   US$3,029 million  

	   Trade and other creditors  
	   $  141 million 

	   Pension/OPEB contingent liabilities  
	   $  1,174 million 

	   Accrued vacation time  
	  $ 61.9 million 

  
  
  4.2.1.1.             ACCC Term Loan

    166.             ACCC is party to a
Credit and Guaranty Agreement dated as of April 1, 2008 (the "Term Loan Facility"), among, inter alia, ACCC, as borrower, ACI, as guarantor, the other guarantors party thereto, the lenders party thereto (the
"Lenders"), and Goldman Sachs Credit Partners L.P., as administrative agent (the "Agent"), under which an amount of about US$347 million of principal remains outstanding.  
 
    167.             The Term Loan Facility is secured, inter alia, by a first ranking charge on certain movable property, corporeal and incorporeal (including monies, instruments and inventory), claims, securities, insurance and
receivables not otherwise charged in connection with the Senior Notes (as defined below), and excluding equipment, intellectual property and capital stock of subsidiaries, of ACCC and of the following guarantors: ACI, ACCOPHI, 1508756, DRI,
MDI, 6169678, 3834328, ACNSI, Terra Nova, Jonquière Pulp, The International Bridge, Scramble, 3224112 and Saguenay Products, all of which are subsidiaries of ACCC.  
 
    168.             The Term Loan Facility is also secured by
a first ranking charge on substantially all of the movable property (including receivables, inventory and equipment) of DCorp, ACSC, ACC, Augusta, ACAC, ARNC, Bridgewater and Cheshire Recycling Ltd. (U.K.), a pledge of the shares or other equity
interests in the DCorp Group entities, and a mortgage over the real estate property related to the Alabama River Newsprint Mill.  
 
 
   
169.             The Term Loan Facility was accelerated as a result of certain events of default
and in any event came to maturity March 30, 2009. The Term Loan Facility was not repaid however, as Abitibi's proposed CBCA plan of arrangement was to address the payment thereof and, as a result of the CBCA interim order granted by this Court,
the lenders' ability to initiate recovery proceedings was stayed.  
 
    170.             As of March 31, 2009, an amount of about US$349.8 million was owed by ACCC under the Term Loan.  
 
   
  4.2.1.2.             Letter of Credit Facilities 
    171.
             On March 21, 2007, a Letter of Credit Facility (the "CIBC LC Facility") was entered into by and
among ACI and ACCC, as borrowers (the "Borrowers"), and the Canadian Imperial Bank of Commerce ("CIBC"), as administrative agent and the lenders parties thereto from time to time.  
 
    172.             Under the CIBC LC Facility, CIBC has agreed to make available to the Borrowers a letter of credit facility guaranteed by Export Development Canada in an aggregate amount of CAD$20 million.  
 
    173.             The Borrowers uses the CIBC LC Facility to guarantee payment or other performance obligations incurred by them and their subsidiaries in the ordinary course of business.  
 
    174.             An amount of about US$13.5 million is currently used by the Borrowers under the CIBC LC Facility.  
 
   
175.             On April 1, 2008, a Letter of Credit Facility (the "Second CIBC
LC Facility") was entered into between ACCC, as borrower, and CIBC, as administrative agent and as initial lender.  
 
   
176.             Under the Second CIBC LC Facility, CIBC has agreed to make available to ACCC a
letter of credit facility in an aggregate amount of CAD$100 million.  
 
    177.             ACCC uses the Second CIBC LC Facility to guarantee payment or other performance obligations incurred by ACCC and its subsidiaries in the
ordinary course of business.  
 
    178.             An amount of about US$73 million is currently used by ACCC under the Second CIBC LC Facility. The Second CIBC LC Facility is secured
by cash deposits in an aggregate amount equal to the face amount of the letters of credit issued under and pursuant to the Second CIBC LC Facility.  
 
   
  4.2.1.3.             ACI Group Public Debt Obligations 
  (i)                    Unsecured Notes 
   
  179.             As of March 31, 2009, the outstanding unsecured public debt obligations of the ACI
Group (the "ACI Group Notes") were the following, additional information relating thereto being summarized in a schedule communicated as Exhibit R‐15:  
  

	  Issuer  
	
  ACI Group Notes  
	
  Capital Outstanding
 (US$ million)  
	
  Accrued Interest 
  (US$ million)  

	   ACFLP  
	   US$250M 7.875% Notes due August 1, 2009  
	   8  
	   0.1  

	   ACI  
	   US$500M 8.55% Notes due August 1, 2010  
	   395  
	   5.6  

	   ACCC  
	   US$293M 15.5% Exchange Notes due July 15, 2010  
	   293  
	   21.5  

	   ACCC  
	   US$200M 7.75% Notes due June 15, 2011  
	   200  
	   4.5  

	   ACCC  
	   US$200M Floating-Rate Notes due June 15, 2011  
	   200  
	   3.4  

	   ACCC  
	   US$350M 6.00% Notes due June 20, 2013  
	   350  
	   5.8  

	   ACCC  
	   US$450M 8.375% Notes due April 1, 2015  
	   450  
	   18.8  

	   ACI  
	   US$100M 7.40% Debentures due April 1, 2018  
	   100  
	   3.7  

	   ACI  
	   US$250M 7.50% Debentures due April 1, 2028  
	   250  
	   9.4  

	   ACI  
	   US$250M 8.50% Debentures due August 1, 2029  
	   250  
	   3.5  

	   ACI  
	   US$450M 8.85% Debentures due April 1, 2030  
	   450  
	   6.6  

	
  Total  
	
   2,946  
	
   82.9  

     
  180.             An
interest payment due on March 15, 2009 in respect of the Floating-Rate Notes due June 15, 2011 was not made as scheduled, as Abitibi's proposed CBCA plan of arrange ment was to address the payment thereof.  
 
   
  (ii)                  Secured Notes 
    181.             ACCC is also the issuer of US$413 million 13.75% Senior Secured Notes due April 1, 2011 (the
"Senior Notes"), of which US$413 million was owing as of March 31, 2009, with the accrued interest thereon of about US$18 million.  
 
    182.             The security granted in respect of the
US$ Senior Notes of ACCC consists primarily of:  
 
   (a)                  mortgages on 11 pulp and paper mills located in Canada and the United Kingdom;  (b)                  a pledge of ACCC's 60% equity interest in MPCo; 
(c)                   pledges of ACCC's 75% equity interests in ACH
and Abitibi-Consolidated Hydro Inc.; and  (d)                  all
of the equipment and intellectual property of ACCC, ACI and the other guarantors (other than DCorp and its restricted subsidiaries).    
 
 
4.2.1.4.             ACI Group Receivables Securitization Program (PCA) 
    183.             ACI and ACSC are parties to a two-level
receivables securitization program (the "Securitization Program") with respect to receivables of ACI and ACSC (the "Receivables"), the obligors of which have a billing address in Canada, the United States or any
other country outside of the United Kingdom, Belgium, Ireland and Germany.  
 
    184.            The purpose of the Securitization Program is to reduce ACI Group's and DCorp Group's working capital requirements and provide liquidity by
enabling them to realize the cash equivalent value of certain of their accounts receivable prior to the usual collection period. The majority of the funds deposited into the Deposit Accounts (as defined below) are revenues generated by the ACI
Group's sale of Products. The Deposit Accounts receive approximately   85 % of the incoming cash receipts from the ACI Group's operations. 
  
    185.             The Securitization Program is set up through (i) an Amended and Restated Purchase and Contribution Agreement dated January 31, 2008 (as amended, restated, supple mented and/or modified from time to time,
the "PCA") between ACI and ACSC, as sellers, and Abitibi-Consolidated U.S. Funding Corp. ("ACUSFC"), as purchaser and (ii) an Amended and Restated Receivables Purchase Agreement also dated January 31, 2008
(as amended, restated, supplemented and/or modified from time to time, the "RPA") between ACUSFC, as seller, Eureka Securitisation, PLC, as investor (the "Investor"), Citibank, N.A. (the "Bank"), as
a bank, Citibank, N.A., London Branch, as the agent (the "Securitization Agent"), ACI and ACSC, as originators, ACSC, as servicer, and ACI, as sub-servicer, and (iii) several Transaction Documents (as defined below).
 
 
   
  (i)                    The Amended and Restated Purchase and Contribution Agreement

    186.            The PCA is
communicated as Exhibit R-16 .  
  
    187.             The PCA is an agreement between ACI and ACSC as sellers and ACUSFC as purchaser. The purpose of the PCA is to
govern the sale by ACI and the sale, contribution or transfer by ACSC (the Sellers thereunder) on a daily basis of the Receivables to ACUSFC (the Purchaser thereunder). The purchase of Receivables includes all Related Security (as defined in the
PCA) with respect thereto.  
 
    188.             The sale and contribution transactions are structured as true sales of the Receivables as opposed to loans from the purchaser to the
sellers as is sometimes the case in other securitization programs. Pursuant to the PCA, ACI and ACSC are required to transfer title to all Receivables and Related Security to ACUSFC free and clear of any lien, claim, charge, encumbrance or other
interest of any kind, other than of ACUSFC.  
 
    189.             The purchase price paid by ACUSFC for the Receivables and Related Security(as defined in the PCA)  is established in the PCA. In
addition to the transfer of the Receivables and Related Security, each of ACI and ACSC also transfers to ACUSFC its interest in, and control of, the Deposit Accounts. The purchase price is due and payable on or within five business days after the
date the Receivables are purchased. The purchase price is payable in cash in the case of ACI but may also be paid by way of a contribution by ACSC to ACUSFC's capital or an increase in the Deferred Purchase Price (as defined in the PCA in the case
of ACSC). The deferred purchase has been set at a maximum of USD$35 million and is evidenced by a subordinated promissory note.  
 
 
   
190.             After having purchased the Receivables, ACUSFC sells undivided fractional
ownership interests (the "Receivable Interests") in such Receivables and its interest in, and control of, the Deposit accounts to the Investor or the banks under the RPA. Pursuant to the RPA, ACUSFC is required to transfer title to
Receivable Interest in such Receivables and Related Security to the Investor or the Banks free and clear of any lien, claim, charge, encumbrance or other interest of any kind, other than of the Investor or the Bank.  
 
    191.             In the ordinary course of business, ACUSFC funds its purchase of the Receivables and Related Security from ACI and ACSC by using (i) the proceeds of the sale of the Receivables and Related Security to the
Investor or the Banks (as defined in the RPA) and (ii) collections on Receivables previously purchased by the Investor or the Banks (to the extent not needed to pay Yield and Fees (as both terms are defined in the RPA) and other amounts owing
under the RPA).  
 
   
  (ii)                  Amended and Restated Receivables Purchase Agreement (RPA) 
    192.            The RPA is communicated as Exhibit R-17 .  
  
    193.             The RPA contemplates that multiple banks may act as purchasers of the Receivables Interests. However, the Bank is currently the only
purchaser of the Receivables Interests.  
 
    194.            Citibank has committed to acquire Receivable Interests in an aggregate principal amount not to exceed $ 210
 million. The amount available under the Securitization Program at any time is limited by the outstanding balance of the eligible Receivables, the size of the Total Reserves (as defined in the RPA)
and other factors. Yield and Fees (as both terms are defined in the RPA) are charged to ACUSFC periodically by the  Securitization Agent. 
  
    195.             The RPA designates ACSC as Servicer and
ACI as Sub-Servicer. ACSC is entitled to a service fee from the Bank for its services.  
 
    196.             Pursuant to the RPA, ACUSFC grants to the Securitization Agent a security interest for its benefit and for the
ratable benefit of the Investor and the Banks in all of ACUSFC's right, title and interest (collectively, the "Collateral") in and to, among other things, (a) the PCA, including (i) all rights of ACUSFC to receive moneys
due or to become due under the PCA, (ii) all security interests and property subject thereto from time to time purporting to secure payment of monies due or to become due under the PCA, (iii) all rights of ACUSFC to receive proceeds of
insurance (including the right to receive proceeds under the Accounts Receivable Policy (Shipments) General Terms and Conditions issued by Export Development Canada and Compagnie Française d'Assurance pour le Commerce Extérieur ‐
Canada Branch (the "Insurance Proceeds"), indemnity, warranty or guaranty with respect to the PCA, (iv) claims of ACUSFC for damages arising out of or for breach of or default under the PCA, and (v) the right of ACUSFC to
compel performance and otherwise exercise all remedies thereunder; (b) all Receivables, the Related Security with respect thereto and the Collections (as defined in the RPA); (c) the lockboxes and deposit accounts to which collections of
the Receivables are remitted (the "Deposit Accounts") and any funds on deposit in the foregoing; and (d) proceeds of any and all of the foregoing. The Deposit Accounts are all subject to control agreements in favor of the
Securitization Agent. Upon an event of termination, the Securitization Agent may realize upon the Collateral to satisfy the obligations of ACUSFC under the RPA.  
 
  
 
  (iii)             
  Other Securitization Transaction Documents 
   
  197.            The other instruments and agreements related to the securitization facility (the "Transaction
Documents") are communicated, en liasse, as  Exhibit R-18 and include notably, the following: 
  
  (a)                   Undertaking Agreement (Servicer) dated as of October 27, 2005 by ACI in favour of Eureka,
Citibank and the other Banks (as defined in the RPA) that are party to the RPA, as amended; 
  (b)                  Undertaking Agreement (Originator) dated as of October 27, 2005 by ACI in
favour of ACUSFC, as amended; 
  (c)                   Deposit Account Control Agreement dated as of January 31, 2008 among ACUSFC, ACI, ACSC,
Citibank and the Securitization Agent; 
  (d)                 Blocked Accounts Agreement dated as of October 27, 2005 among ACI, ACSC, the Securitization Agent, Royal
Bank of Canada and ACUSFC;  
  (e)                  Agreement Re: Pledged Deposit Accounts dated as of October 27, 2005 among ACSC, ACI, ACUSFC, the
  Securitization Agent and LaSalle Bank National Association; 
  (f)                   Second Amended and Restated Four Party Agreement
for Sold Accounts (General) dated as of January 31, 2008 among Export Development Canada and Compagnie Française d'Assurance pour le Commerce  Extérieur ‐ Canada Branch, ACI, ACUSFC, the Securitization Agent and Citibank;
 
  (g)                  Intercompany Agreement dated as of December 20, 2007 between ACI and ACSC; and 
  (h)                the Accounts Receivable Policy (Shipments) General Terms and Conditions, plus the Coverage Certificate effective September 1, 2008 (together with all
schedules and endorsements thereto) issued by Export Development Canada and Compagnie Française d'Assurance pour le Commerce Extérieur ‐ Canada Branch to ACI. 
   
  (iv)                Status of the Securitization Program 
 
    198.             On April 1, 2009, ACI, ACSC, ACUSFC, Eureka, the Bank and the Securitization Agent
entered into Waiver and Amendment No. 4 to the RPA.  As a result, Eureka, the Bank and the Securitization Agent waived certain events of termination under the RPA, extended the Securitization Program to September 1, 2009 and added
certain covenants and an event of termination.  
 
    199.             The filing of the U.S. Proceedings, of these proceedings and of certain other insolvency related events would constitute Events of
Termination under the Securitization Program in the absence of the waiver agreement referred to in the next paragraph. In general terms, the outstanding pool of sold Receivables (and undistributed proceeds) would then be identified as of the day
prior to the termination date. If the Securitization Program were to be terminated as a result of the occurrence of an Event of Termination, the cash flows from the collection of Receivables would no longer be permitted to be applied by ACUSFC to
purchase additional Receivables from ACI and ACSC. Instead, available collections of the sold Receivables would be distributed to the Bank and the Investor until all amounts then owing to the Investor and the Banks under the Securitization Program
have been repaid. After all such amounts have been paid in full, additional collections would remain the property of ACUSFC and would then be available to be used or distributed by ACUSFC in the manner determined by its management and board of
directors, consistent with its separate corporate existence.  
 
    200.             In anticipation of the filing of the U.S. Proceedings and of these proceedings, an agreement entitled "  Omnibus Amendment No. 5 to Amended and Restated Receivables Purchase Agreement and Amendment No. 3 to Amended and Restated Purchase and Contribution Agreement and Waiver Agreement   "  (the "Waiver Agreement") was negotiated and executed between the parties to the Securitization Program so that the occurrence of such proceedings or of other insolvency related events will not constitute an Event of
Termination, Facility Termination Date or Commitment Termination Date and the Securitization Program can continue.  
 
    201.             The Waiver Agreement is communicated as Exhibit R‐19.  
 
    202.             The Waiver Agreement provides a window of opportunity of approximately five weeks for ACI to negotiate alternative financing arrangements to replace the existing securitization arrangements.  ACI intends has
already commenced negotiations with certain alternative providers and intends to pursue such discussions with the assistance of the Monitor and its financial advisor BMO Capital Markets (as defined below). Any replacement facility will be subject to
court approval.  
 
    203.          
  The Monitor has reviewed and supports the continuation of the Securitization Program on the terms proposed.  
 
   
  4.2.2.         
BI Group Indebtedness 
    204.            In addition to trade debts, the principal debt obligations of the BI Group currently outstanding consist of credit facilities and public debt obligations. The BI Group's indebtedness as of 
March 31, 2009  included the following: 
 
  
  

	   U.S. Credit Agreement  
	   US$203.8 million  

	   Canadian Credit Agreement  
	   $61.1 million  

	   Public debt obligations  
	   US$  2,083 million 

	   Trade and other creditors  
	   $  40 million 

	   Pension/OPEB contingent liabilities  
	   $  925 million 

	   Accrued vacation time  
	  $ 14.5 million 

  
  
  4.2.2.2.             BI Group
Credit Facilities 
   
  205.          
  On May 31, 2006, BI entered into the following credit facilities:  
 
   (a)                  a five-year credit agreement among BI, as borrower, the lenders from time-to-time party thereto, and
Wachovia as administrative agent (the "U.S. Credit Agreement"); and  (b)               
  a 364‐day credit agreement among BCFPI, as borrower, BI, as a guarantor, the lenders from time-to-time party thereto, and The Bank of Nova Scotia, as administrative agent (the "Canadian
Credit Agreement").     206.             The U.S. Credit Agreement has been amended on July 20, 2007, October 31, 2007, February 25, 2008, March 31, 2008, April 30, 2008, June 30, 2008, August 7, 2008, November 12, 2008, February 27,
2009 and March 23, 2009.  
 
    207.             The Canadian Credit Agreement has been amended on July 20, 2007, October 31, 2007, February 25, 2008, March 31, 2008,
April 30, 2008, May 28, 2008, June 6, 2008, June 30, 2008, August 7, 2008, November 12, 2008, and February 27, 2009.  
 
    208.             On May 15, 2008, BNS LLC, Bowater
Alabama LLC, and Bowater Newsprint South Operations LLC (collectively, and together with BI, the "U.S. Borrowers") were joined to the U.S. Credit Agreement as borrowers and to the Canadian Credit Agreement as guarantors. 
 
 
    209.             The U.S. Credit Agreement provides for a $381,577,000 revolving credit facility with a scheduled maturity date of May 25, 2011.  
 
    210.             The U.S. Credit Agreement is guaranteed
by ABH and certain of BI's direct and indirect U.S. subsidiaries, and is secured by, among other things, (i) liens on the inventory, accounts receivable and deposit accounts of the U.S. Borrowers and the guarantors, (ii) pledges of 65% of
the stock of certain of BI's foreign subsidiaries, (iii) pledges of the stock of certain of BI's U.S. subsidiaries that do not own mills or converting facilities, and (iv) real property fixtures and equipment relating to the Coosa Pines,
Alabama and Grenada, Mississippi mills.  
 
    211.             Availability under the U.S. Credit Agreement is tied to a percentage of certain accounts receivable (other than intercompany accounts
receivable) and inventory of BI, BNS LLC, and certain of their U.S. subsidiaries, and is reduced by the amount of outstanding letters of credit.  
 
  
 
  212.             The Canadian Credit Agreement provides for a $129,734,000 revolving and fully advanced term credit facility with a maturity date of June 5, 2009.  
 
    213.             The Canadian Credit Agreement is
guaranteed by the U.S. Borrowers and certain subsidiaries of BCFPI and is secured by, among other things, (i) liens on the inventory, claims, accounts receivable and deposit accounts of BCFPI and its subsidiaries that are guarantors,
(ii) liens on the real property and fixtures relating to the Coosa Pines, Alabama and Grenada, Mississippi paper mills, (iii) liens on the immovable properties of BCFPI located in Gatineau (Québec), Dolbeau (Québec) and Thunder
Bay (Ontario) and on all equipment and other property relating to such immovable properties, (iv) a floating charge (equitable mortgage) on all other immovable properties of BCFPI, and (v) a pledge of the shares of BCFPI's South Korean
subsidiary (which operates BCFPI's Mokpo mill). The liens outlined in (iii), (iv) and (v) above secure obligations under the Canadian Credit Agreement up to an aggregate maximum amount of $67 million.  
 
    214.             Availability under the Canadian Credit Agreement is tied to a percentage of the value of certain accounts receivable (other than intercompany accounts receivable) and inventory of BCFPI and its subsidiaries and is
reduced by the amount of outstanding letters of credit.  
 
    215.            As of   March 31 , 2009, the outstanding balance excluding accrued
interest of the U.S. Credit Agreement is US$203,751,000 and the outstanding balance excluding accrued interest of the Canadian Credit Agreement is $61,111,000. 
  
   
  4.2.2.3.             BI Group Public Debt Obligations 
    216.             As of March 31, 2009, the public debt obligations outstanding of BI, BCFC or BCFPI (the "BI Notes") were the
following, additional information relating thereto being summarized in a schedule communicated as Exhibit R‐20:  
  
 

	  Issuer  
	
  Bowater Notes  
	
  Capital Outstanding
 (US$ million)  
	
  Accrued Interest 
  (US$ million)  

	   BI  
	   US$300M 9% Debentures due August 1, 2009  
	   248  
	   3.7  

	   BI  
	   US$250M Floating Rate Notes due March 15, 2010  
	   234  
	   0.5  

	   BCFPI  
	   US$102M 10.50% Notes due June 15, 2010  
	   20  
	   0.6  

	   BCFPI  
	   US$98M 10.63% Notes due June 15, 2010  
	   3  
	   0.1  

	   BCFPI  
	   US$22M 10.26% Notes due January 15, 2011  
	   7  
	   0.1  

	   BCFPI  
	   US$70M 10.60% Notes due January 15, 2011  
	   70  
	   1.5  

	   BCFC  
	   US$600M 7.95% Notes due November 15, 2011  
	   600  
	   21.8  

	   BI  
	   US$125M 9.50% Debentures due October 15, 2012  
	   125  
	   5.4  

	   BI  
	   US$400M 6.50% Notes due June 15, 2013  
	   400  
	   7.6  

	   BCFPI  
	   US$125M 10.85% Debentures due November 30, 2014  
	   125  
	   4.5  

	   BI  
	   US$200M 9.375% Notes due December 15, 2021  
	   200  
	   5.5  

	
  Total  
	
   2,032  
	
     51.3  

     
 
   
  4.2.3.          Trade suppliers 
   
  4.2.3.1.             The ACI Group 
    217.            As of the  date hereof, an amount in excess of $141 million is
owing by the ACI Group to trade creditors. 
  
   
  4.2.3.2.             The BI Group 
    218.            As of date hereof, an amount in excess of $ 40  million is owing by the BI Group to trade creditors. 
  
     
  4.2.4.          Pension Plan Liabilities
 
   
  4.2.4.1.           
 The ACI Group Pension Liabilities  
   
  (i)                    Canadian Pension Liabilities 
  
 219.             The ACI Group maintains
20 registered pension plans (the "Canadian Pension Plans") for its Canadian employees.  
 
    220.             Some of the Canadian Pension Plans provide defined benefits, some provide defined
contributions and some operate on a hybrid (i.e., defined benefit and defined contribu tion) basis. All the Canadian Pension Plans are registered with the Canada Revenue Agency and the applicable provincial pension regulator. The Canadian
Pension Plans are funded by contributions from the ACI Group and, in most cases, also by contributions from plan members.  
 
    221.             The ACI Group's aggregate contributions to the defined benefit Canadian Pension Plans in
Canada during the fiscal year ended December 31, 2008 totaled $148,248,065.  
 
    222.
            As of December 31, 2008, the aggregate solvency deficit (i.e., essentially assuming their total termination) of the
defined benefit Canadian Pension Plans (including the hybrid plans, as applicable) was estimated at approximately $964 million. Under the pension legislation governing the Canadian Pension Plans, contributions to amortize such solvency deficit
over a prescribed period must be made by the ACI Group in addition to the current service contributions for benefits accruing during the year of contribution.  
 
    223.             Based on the most recent estimates
available, the aggregate contributions of the ACI Group to the defined benefit Canadian Pension Plans for the fiscal year ended December 31, 2009 are expected to be in the amount of about  $131 million. This amount includes about
$102.4 million in actual and estimated special payments.  
 
 
    224.             Contributions under the Canadian Pension Plans are made on a monthly basis by the ACI Group.  
 
   
  (ii)                  UK Pension Liabilities 
    225.             The ACI Group maintains one defined benefit pension plan (the "UK Pension
Plan") for its United Kingdom employees. The UK Pension Plan is funded by contributions from the ACI Group and also by contributions from plan members. The ACI Group's aggregate contributions to the UK Pension Plan in the United Kingdom
during the fiscal year ended December 31, 2008 totaled $3,927,790.  
 
    226.             As of December 31, 2008, the aggregate deficit for financial accounting purposes of the UK Pension Plan was estimated at
approximately $26,591,000. Contributions to amortize the funding deficit (albeit calculated on a different basis from financial accounting) over a prescribed period must be made by the ACI Group in addition to the current service contributions for
benefits accruing during the year of contribution. On a plan termination basis, the deficit would be different.  
 
    227.             Based on the most recent estimates available, the aggregate contributions of the ACI
Group to the UK Pension Plan for the fiscal year ended December 31, 2009 are expected to be in the amount of $3,571,000. Contributions under the UK Pension Plan are made on a regular basis by the ACI Group.  
 
   
  (iii)                Post-Retirement Liabilities 
    228.             The ACI Group maintains supplemental pension plans (the "Canadian SERPs") for its
Canadian salaried employees and post-retirement benefits for its employees (the "Canadian OPEBs"). A small proportion of SERPs benefits are funded by contributions from the ACI Group, others are secured by a letter of credit and
others are not secured at all. The ACI Group's aggregate contributions to the Canadian SERPs and Canadian OPEBs during the fiscal year ended December 31, 2008 totaled $ 5,781,000 and $ 9,207,739 respectively. 
 
 
    229.             As of December 31, 2008, the aggregate deficit for financial accounting purposes of the Canadian SERPs and the Canadian OPEBs were estimated at approximately $77,971,000 and $105,662,000
respectively.  
 
    230.             Based on the most recent estimates available, the aggregate contributions of the ACI Group to the Canadian SERPs and the Canadian
OPEBs for the fiscal year ended December 31, 2009 are expected to be in the amounts of $ 11,536,000 and $9,320,000 respectively.  
 
    231.             The Abitibi Petitioners intend to suspend
the remittance of special payments and Canadian SERPs payments in respect of past service for all current and former employees to the defined benefits Canadian Pension Plans during the CCAA stay period but will continue to make current service
contributions to such plans, and will also make contributions to all defined contribution Canadian Pension Plans and Canadian OPEBs.  
 
 
   
  4.2.4.2.             The BI Group Pension Liabilities 
   
  (i)                    Canadian Pension Liabilities 
    232.             The BI Group maintains 13 registered
pension plans (the "BI Canadian Pension Plans") for its Canadian employees.  
 
    233.
             Some of the Canadian Pension Plans provide defined benefits, some provide defined contributions and some operate on a hybrid
(i.e., defined benefit and defined contribu tion) basis. All the Canadian Pension Plans are registered with the Canada Revenue Agency and the applicable provincial pension regulator. The Canadian Pension Plans are funded by contributions from
the BI Group and, in most cases, also by contributions from plan members.  
 
    234.             The BI Group's aggregate contributions to the defined benefit Canadian Pension Plans in Canada during the fiscal year ended
December 31, 2008 totaled $66,431,915.  
 
    235.             As of December 31, 2008, the aggregate solvency deficit (i.e., essentially assuming their total termination) of the defined
benefit Canadian Pension Plans (including the hybrid plans, as applicable) was estimated at approximately $419 million. Under the pension legislation governing the Canadian Pension Plans, contributions to amortize such solvency deficit over a
prescribed period must be made by the BI Group in addition to the current service contributions for benefits accruing during the year of contribution.  
 
    236.             Based on the most recent estimates
available, the aggregate contributions of the BI Group to the defined benefit Canadian Pension Plans for the fiscal year ended December 31, 2009 are expected to be in the amount of  about $72 million. This amount includes about $56.9
million in actual and estimated special payments.  
 
    237.             Contributions under the Canadian Pension Plans are made on a monthly basis by the BI Group.  
 
   
  (ii)                  US Pension Liabilities 
    238.             The BI Group maintains two qualified defined benefit pension plans (the "BI US
Pension Plans") and one qualified defined contribution plan for its United States employees. In addition, the BI Group has a minority participation in a qualified defined benefit pension plan and a qualified defined contribution plan
sponsored by Ponderay Newsprint Company.  
 
    239.             All the BI US Pension Plans are qualified under the Internal Revenue Code with the Internal Revenue Services and must comply with the
Employee Retirement Income Security Act ("ERISA"). The BI US Pension Plans are funded by contributions from the BI Group.  
 
    240.             The BI Group's aggregate contributions to
the BI US Pension Plans in the United States during the fiscal year ended December 31, 2008 totaled $15,340,262.  
 
 
    241.             As of December 31, 2008, the aggregate deficit for financial accounting purposes of
the BI US Pension Plans was estimated at approximately US$157,632,000. Under the Internal Revenue Code, contributions to amortize the funding deficit (albeit calculated on a different basis from financial accounting) over a prescribed period must be
made by the BI Group in addition to the current service contributions for benefits accruing during the year of contribution. It is estimated that the funding deficit would be greater on a plan termination basis.  
 
    242.             Based on the most recent estimates available, the aggregate contributions of the BI Group to the BI US Pension Plans for the fiscal year ended December 31, 2009 are expected to be in the amount of $10,790,000.
 
 
    243.             Contributions under the BI US Pension Plans are made on a quarterly basis by the BI Group.  
 
   
  (iii)                Post-Retirement Liabilities 
    244.             The BI Group maintains supplemental pension plans ("BI SERP") for its Canadian and US
salaried employees and post-retirement benefits for its employees (the "BI OPEBs"). Some SERP benefits are secured by a letter of credit and others are not secured at all. The BI Group's aggregate contributions to the BI SERPs
and BI OPEBs during the fiscal year ended December 31, 2008 totaled $ 25,850,000 and $19,004,000 , respectively.  
 
    245.             As of December 31, 2008, the
aggregate deficit for financial accounting purposes of the BI SERPs and BI OPEBs were estimated at approximately $74,420,000 and $273,975,000 respectively .  
 

   246.             Based on the most recent
estimates available, the aggregate contributions of the BI Group to the BI SERPs and the BI OPEBs for the fiscal year ended December 31, 2009 are expected to be in the amounts of $ 9,082,000 $and 21,726,000 respectively
 .  
 
    247.             The Bowater Petitioners intend to suspend the remittance of special payments in respect of past service for all current and former
employees to the defined benefits BI Canadian Pension Plans during the CCAA stay period but will continue to make current service contributions to such plans, and will also make contributions to all defined contribution BI Canadian Pension Plans and
BI OPEBs.  
 
   
  4.2.5.          Other Employee Obligations 
    248.             The severance and salary continuance obligations of the Petitioners (including obligations of ACCC resulting from the closure of the Grand
Falls newsprint mill which are estimated to be in excess of $28 million) are estimated to be in the amount of about $46.5 million. Given their very tight cash flow projections, the Petitioners propose to suspend all severance payments for the time
being but expect to review the issue and seek direction from the Court when adequate DIP financing has become available to all Petitioners.  
 
    249.             The ACI Group and the BI Group provide
vacation time to their employees as a paid time-off benefit. The duration of vacation benefits varies based on the employee's loca tion, position, amount of time employed and may be governed by collective bargaining agreements, where applicable. The
estimated amount of accrued, unused vacation time at the end of 2008 was approximately the following: ACI Group: $61.9 million and BI Group (Canadian entities): $14.5 million.  
 
 
  5.                     Cause of financial difficulties 
    250.             In general, the ABH Group's products are
globally traded commodities, and the markets in which they compete are highly competitive. Pricing and the level of shipments of products are influenced by the balance between supply and demand, global economic conditions, changes in consumption and
capacity, the level of customer and producer inventories and fluctuations in currency exchange rates.  
 
    251.             For the last several years, the ABH Group and its predecessors have faced a significant deterioration in
business conditions in all of their primary business segments.  
 
    252.             The financial performance of the ABH Group has suffered as a result of a combination of factors, including fluctuations in the strength of
the Canadian dollar, rising energy and fiber costs, increasing pension expenses, a decline in demand for newsprint and certain specialty papers and a decline in the U.S. housing market.  
 

   253.             Also, an advertising recession
is in full swing and it is impacting both printed and electronic media. Other factors more closely related to the paper markets, such as consumer destocking, are also pushing down demand for printing and writing papers.  
 
    254.             Trends in advertising, electronic data transmission and storage, and the Internet could continue to adversely affect traditional print media, including the ABH Group's products and those of their customers. 

 
  6.                     RESTRUCTURING EFFORTS 
  6.1.               Strategic Review of Operations 
    255.             Promptly following the Combination, the
ABH Group began a comprehensive strategic review of operations to reduce costs and improve profitability.  
 
    256.             On November 29, 2007, given its focus on debt reduction, the ABH Group also announced its decision to
suspend dividends to shareholders.  
 
    257.             Since the Combination, the ABH Group has undertaken numerous cost-saving measures in efforts designed to address the challenges imposed by
the above-described market conditions.  
 
    258.             The first phase of the review was concluded on November 29, 2007, when the ABH Group approved an action to begin reducing newsprint
and specialty papers production capacity by almost 1 million metric tons ("MT") per year by the end of the first quarter of 2008.  
 
   
  259.             On December 4, 2008, the ABH Group
also announced additional measures aimed at creating a more flexible and responsive operating platform, addressing ongoing volatility in exchange rates, energy and fiber pricing, as well as structural challenges in the North American newsprint
industry. Pursuant to these measures, the ABH Group announced the removal of an additional 830,000 MT of newsprint, 110,000 MT of specialty paper and 70,000 MT of coated paper capacity through:  
 
   (a)                 
the permanent closure by the end of the first quarter of 2009 of the Grand Falls, Newfoundland and Labrador newsprint mill, representing 205,000 MT;  (b)                  the permanent closure by the end of 2008 of the Covington, Tennessee paper converting facility, representing
70,000 MT of coated grades;  (c)                   the
immediate idling, until further notice, of the Alabama River newsprint mill, in Alabama, representing 265,000 MT;  (d)                  the immediate idling, until further notice, of two paper machines (#1 and #2) in Calhoun, Tennessee,
representing 230,000 MT of capacity, including 120,000 MT of newsprint and 110,000 MT of specialty grades; and  (e)                   on a revolving basis, about 20,000 MT of monthly newsprint downtime at other facilities across
the organization until market conditions improve.     260.             As a result of the Combination, on December 31, 2008, the ABH Group had achieved an annual run rate of approximately $375 million in captured synergies from improved efficiencies in such areas as
production, selling and administrative expenses, procurement and logistics costs.  
 
   
 
6.2.               April 2008 Refinancing 
    261.             On April 1, 2008, ABH and the ACI
Group successfully completed a series of refinancing transactions, which were designed to address the debt maturities and general liquidity needs principally at the ACI Group level. The transactions included:  
 
   (a)                 
the issuance by ACCC of US$413 million of Secured Notes;  (b)                  the Term Loan in the original amount of US$400 million;  (c)                   a private exchange offer whereby ACCC offered a combination of the July 2010 Notes and cash in
exchange for an aggregate of US$455 million of then out standing unsecured notes;  (d)               
  a private sale of US$350 million of 8% Convertible debentures of ABH due April 15, 2013 ("Convertible Notes") to Fairfax Financial Holdings Limited ("Fairfax") and
certain of its designated subsidiaries. Two representatives of Fairfax have seats on ABH's Board of Directors; and  (e)                   the repayment and cancellation of ACI  ́ s then
existing credit facility was repaid and cancelled.  
   
  6.3.               Additional Strategic Alternatives 
    262.             On April 15, 2008, ACCC repaid US$50 million of the Term Loan with a portion of the proceeds from the
sale of certain assets and repaid another US$3 million with a portion of the proceeds from other debt issuances, which reduced the outstanding principal amount of the Term Loan to US$347 million.  
 
    263.             However, faced with deteriorating business conditions and a highly leveraged balance sheet, ABH was forced to consider a broad range of additional strategic alternatives to address the capital structure of its group
and enhance liquidity.  
 
    264.             The management of ABH conducted a comprehensive strategic review to reach these goals, with the guidance and oversight of the Board of
Directors and with the benefit of the advice of its financial advisors. Strategic initiatives considered, some of which were announced, included non-core asset sales, cost reduction initiatives and refinancing.  
  
 
  6.4.               ACH Sale 
    265.
            In December 2008, ABH accepted a proposal for the sale of ACCC  ́ s 75%
interest in ACH to a major unaffiliated industrial energy producer. The resulting gross proceeds (excluding expenses) would be $197.5 million. As part of the transaction, the buyer would also assume $250 million of ACH debt. The
non-binding proposal is subject to due diligence, among other terms and conditions. While it continues to be expected that a definitive agreement will be reached in the second quarter of 2009, no assurances can be provided as to when or if a
definitive agreement will be executed.  
  
 
  6.5.               BI Exchange Offers 
    266.             As mentioned previously, on February 9, 2009, ABH commenced private offers (the
"BI Exchange Offers") to exchange US$1.8 billion of outstanding series of unsecured notes (the "Bowater Notes") issued by BI (or by a subsidiary of BI), in a private placement, for new notes (the
"Bowater Exchange Notes"). The Bowater Exchange Notes were to be issued by Bowater Finance II LLC ("Bowater Finance"), an indirect wholly-owned subsidiary of ABH, and would have consisted of: (a) 10.00% Second Lien
Notes due January 31, 2012, and (b) 10.50% Third Lien Notes due March 31, 2012.  
 
    267.
             As part of the BI Exchange Offers, ABH solicited consents ("Consent Solicitation") to amend the indentures
governing the Existing Notes to eliminate the covenants in such indentures relating to liens, secured debt and sale/leaseback transactions.  
 
    268.             The BI Exchange Offers and Consent
Solicitation initially expired on March 20, 2009 and was extended four times, first until March 20, 2009 a second time until March 25, 2009 then until March 27, 2009 and finally until March 31, 2009.  
 
    269.             Concurrently with the BI Exchange Offers and the Consent Solicitation, Bowater Finance offered to eligible holders of Bowater Notes, in a "Concurrent Notes Offering", new 15.50% First Lien Notes
due November 15, 2011.  
 
   
  270.             The BI Exchange Offers, the Consent Solicitation and Concurrent Notes Offering were not completed as an insufficient number of notes were
tendered and expired on April 1, 2009 following several extensions. ABH has since then evaluated other restructuring alternatives and held discussions with BI Group debtholders and other stakeholders to restructure the BI Group's debt. 

 
   
  6.6.               MPCo Sale 
    271.
            On March 13, 2009, ABH announced that ACCC and an unaffiliated third party had signed a letter of intent in connection
with the sale of ACCC  ́ s 60% interest in MPCo for gross proceeds of $615 million ("MPCo Sale"). ACCC is in continuing discussions and negotiations in connection with the MPCo
Sale.  
 
   
  6.7.               The ACI Group's CBCA Arrangement 
    272.             As mentioned previously, on March 13, 2009, this Court granted an interim order under sections 192
and 248 of the CBCA in favor of ACI and certain affiliated applicants in connection with a plan of arrangement proposed by them.  
 
    273.             The plan of arrangement included a series of complex and interrelated steps leading to a
de‐leveraging and recapitalization of the ACI Group.  
 
    274.             While the implementation of the arrangement as originally proposed was conditioned upon the successful completion of the BI Exchange
Offers, in the interest of the ACI Group and its stakeholders ABH and the ACI Group decided to continue the ACI Group recapitalization and to amend such process as necessary to take into account the developments on the BI Group refinancing. 

 
    275.             ABH has now determined that it will be unable to pursue an alternative restructuring of the BI Group without significant additional discussion and negotiation with its debt holders. As a result, it is not
possible to establish the time frame within which the ACI Group's arrangement could reasonably be completed, nor the amended terms on which it could be proposed.  
 
   
  6.8.               Preparing  for Alternative Plans 
    276.             Since January 16, 2009, the Board of Directors of ABH and an Ad Hoc Finance Committee thereof have met frequently and have
consulted with management and financial and legal advisors in order to consider its recapitalization attempts and related matters, and more recently, to consider the necessity of initiating these proceedings and the U.S. Proceedings.  

    277.            On   April 15 , 2009, based on the advice and counsel of its financial advisor and management, and having considered such other factors as it has deemed
necessary, including the terms and upcoming maturities of the debt obligations of ABH and its subsidiaries, the general liquidity needs of ABH and its subsidiaries as well as the current state of ABH ́s business and the credit and capital
markets, the Board of Directors of ABH determined that it is in the best interests of ABH and its stakeholders that these proceedings and the U.S. Proceedings be filed. 
  
 
    278.             The Boards of Directors or shareholders
of each of the Petitioners have also approved the filing of these proceedings.  
 
  7.                     Overview of the Restructuring Plan 
    279.             The Petitioners are of the view that the
overall business of the ABH Group can be viable and, in fact, will be profitable over time.  
 
    280.
             The ABH Group has previously attempted to improve its processes and restructure its business. In the face of an ongoing
liquidity crisis, further restructuring may be undertaken by the ABH Group so as to discontinue business operations that cannot be made profitable and to streamline other business segments in order to increase profitability.  
 
    281.             The ABH Group is a global leader in the forestry product industry with significant advantages and a strong customer base. However, it is recognized that in the absence of these proceedings, it will be extremely
difficult, if not impossible, to maintain value for all stakeholders, given the current liquidity problems and the pressures being brought to bear upon the ABH Group and the Petitioners by creditors and other stakeholders.  
 
    282.             The ABH Group, together with its advisors, continues to review restructuring alternatives. At this stage, a restructuring within a court supervised process is necessary to ensure fair and equitable treatment for all
stakeholders. Once the business is stabilized, the Petitioners will be able to update this Court on their restructuring efforts and alternatives, including proposed plan(s) of arrangement.  
 
    283.             The Petitioners need to obtain the Court's protection in Canada and approval of the BI DIP Facility (defined below) to ensure that they can continue to operate in the normal course of business and preserve the value
of their assets as a going concern, for the benefit of all stakeholders.  
 
    284.             Petitioners had, as previously explained, set the wheels in motion for a restructuring of their operations and their financial situation.
Given the present situation, the Petitioners have had to conclude that the measures already undertaken or implemented are not sufficient.  
 
    285.             Therefore, the Petitioners, together with
their advisors, are in the process of preparing restructuring plan(s), which will allow the ABH Group to be profitable over time.  Such plans will include the following previously announced measures: (a) disposing of assets; (b) reducing
indebtedness; and (c) reducing financial costs.  
 
    286.             Although the Petitioners are not yet in a position to provide the details of the plans of arrangement to be submitted to their creditors,
they are confident that, together with their advisors, they will be able to do so for the benefit of all stakeholders and to that end, will work diligently.  
 
    287.             It is the Petitioners' view that a
successful restructuring of their operations will allow for a significant number of jobs to be preserved in Québec and in other jurisdictions in which they operate.  
 
 
   
  8.                     RELIEF SOUGHT 
  8.1.               General 
   
288.             The Petitioners believe that it is wholly appropriate for the order requested
herein to be made forthwith seeing as they find themselves in dire financial circumstances, are insolvent, are not able to meet their obligations, and require a stay of proceedings for the benefit of their creditors, customers and other
stakeholders.  
 
    289.          
  The Petitioners are deeply concerned that unless the requested order is made, certain suppliers, creditors and other stakeholders may take steps that will deplete the Petitioners' estate to the
detriment of all stakeholders, and jeopardize the ongoing restructuring efforts.  
 
    290.
            The CCAA stay will also preserve the status quo and prevent creditors and others from taking any steps to try and better their
positions in comparison to other creditors. All stakeholders generally, including creditors, will benefit from the requested order.  
 
  8.2.               Appointment of Monitor 
    291.           Ernst & Young   Inc. ("
  Ernst & Young   ") has been assisting Abitibi with the pending CCAA application and is aware of the Petitioners' financial circumstances.  
Ernst & Young  has agreed to act as monitor in the Petitioners' CCAA proceedings, subject to approval by this Court.  
 
    292.           Ernst & Young  , in its capacity
as proposed monitor, will file in support of this Petition a report dealing with the following issues:  
 
   (a)                  ABH's background and financial structure;  (b)                  ABH's current liquidity crisis;  (c)                   ABH's decision to commence formal insolvency proceedings;  (d)                  an overview of ACI's and BCFPI's short term cash flow forecasts, ACI's proposed
continued use of its accounts receivable Securitization Program and BCFPI's proposed Debtor-in-Possession ("DIP") financing;  (e)                   selected financial matters addressed in the proposed Initial Order;  (f)                    restructuring options; and  (g)                  conclusions and recommendations.    
  (the " Ernst & Young  Report"), a copy of which is filed in support of the present Motion as Exhibit R-21. 
    293.             The Petitioners believe that it is in the best interests of all stakeholders that this Court appoint Ernst & Young as the monitor
of the Petitioners pursuant to the CCAA. Ernst & Young has valuable insights into the Petitioners' business and will be in a position to perform the monitoring duties without further delay.  
 
   
  294.             In addition to any powers or obligations provided for by the CCAA, the Petitioners hereby request that this Court grant the Monitor the powers, rights, obligations and protections detailed in the conclusions of this
Motion.  
 
  8.3.            
  Financing 
    295.           
 The ABH Group and the Petitioners have devoted substantial energies and attention to pursuing refinancing options. Unfortunately, the consensual refinancing efforts failed to be completed. As of  the date hereof,  the Abitibi Petitioners' cash and cash equivalents of are sufficient to meet their immediate cash requirements provided that the Securitization Program is continued and that
these funds are protected by the stay of proceedings being sought before the Court. The BI Petitioners anticipate that they will require approximately US$ 40 million  in interim DIP
Financing during the initial 30-day stay period. 
  
    296.            Cash flow forecasts for ACI and for BCFPI for the five-week period from April 19, 2009 to May 22, 2009 are communicated as  Exhibit R- 22 . 
  
   
  8.3.6.          The BI Group 
    297.             Prior to the filings of these proceedings
and the U.S. Proceedings, the BI Group relied on the revolving credit facilities made available under the U.S. Credit Agreement and the Canadian Credit Agreement to maintain a consistent cash flow for its operations.  
 
    298.             The U.S. Credit Agreement and the Canadian Credit Agreement were recently terminated. As a result, the BI Group no longer has access to financing and is unable to purchase inventory and discharge its obligations in
the ordinary course.  
 
    299.             In order to address financing needs during these proceedings, the ABH Group and its advisors have contacted several financial institutions
in Canada and the United States so as to secure interim financing for the Canadian and U.S. Operations of the BI Group.  
 
    300.             In anticipation of the U.S. Proceedings and of these CCAA proceedings, a Senior
Secured Superpriority Debtor-in-Possession Credit Agreement amongst ABH, BI and BCFPI (the "Borrowers"), as Borrowers, Avenue Invetments L.P. and Fairfax ("FFH") as Initial Lenders, and such lenders as may be
party to such Agreement from time to time (toge ther the "BI DIP Lenders"),   FFH   as initial Administrative Agent and Collateral Agent, (the "DIP
Credit Agreement") was negotiated in order to, amongst other things, finance the post-filing working capital requirements of the BI Group, general corporate purposes and permitted capital expenditures (the "BI DIP
Facility"). A copy of the DIP Credit Agreement is communicated as  Exhibit R‐23.  
  
   
   The most significant features of the BI DIP
Facility are as follows: 
   (a)                  ABH, BI
and BCFPI are borrowers under the BI DIP Facility;  
   
  (a)                a  "US Term Advance" of US$ 166  million made available to ABH and BI in US
dollars; 
 (b)                  a "Canadian Term
Advance" of US$ 40  million made available to BCFPI in US dollars; (c)                   "Incremental Advances" (the "  Incremental
Facility  ") in a maximum aggregate amount of US$360 million minus the outstanding principal amount of the U.S. Term Advance and the Canadian Term Advance;  (d)                  an "ABL Facility" in an amount of up to US$600 million less the
outstanding principal amount of the BI DIP Facility;  (e)                   borrowings by ABH and BI under the BI DIP Facility are guaranteed by ABH, BI and each direct and indirect wholly-owned subsidiary of BI and BNSLLC organized under the laws of a state of the United States of America
and which is a U.S. Debtor (the "Guarantors") and secured by a) second priority security interests in all assets securing the U.S. Credit Agreement and b) first priority security interests in all assets including, without
limitation, all assets consisting of and located on the BI Group's properties in Catawba, South Carolina and Calhoun, Tennessee; and  (f)                    borrowings by BCFPI are guaranteed by ABH, BI, BNSLLC and the Guarantors and are secured
by the assets of the Bowater Petitioners and Partnerships.  The security interest extends, as applicable, to the Bowater Petitioners' and Partnerships' inventory, accounts, equipment, intangibles, deposit accounts, investment property and real
estate.  The amount borrowed by BCFPI under the DIP Facility will be secured by inter alia, a court-ordered charge on the Bowater Petitioners' property ranking in priority to all other liens, charges and security interests, but
subordinate to the Bowater Administration Charge, a portion of the BI D&O Charge and the security interests securing the Canadian Credit Agreement.      301.             ABH received other interim financing offers from various other potential lenders. However, after consideration
and review by ABH, BI and BCFPI in consultation with their advisors, it was determined that it would be in the best interest of ABH, the BI Group and all stakeholders to accept the above mentioned DIP financing.  
 
    302.             An
amount of approximately $61.1 million is outstanding under the Canadian Credit Agreement. As of   February 28, 2009  the value of the inventory and accounts receivable of BCFPI
securing the Canadian Credit Agreement was about $179 million. This represents a surplus of collateral value of approximately $ 118  million. In addition, the Canadian Credit
Agreement is secured by the assets mentioned in paragraph  213  hereof.  
  
   
  8.3.7.         
The ACI Group 
    303.            
Prior to the filings of these proceedings and the U.S. Proceedings, the ACI Group relied on the Securitization Program to maintain a consistent cash flow for its operations.  
 
 
  
 304.             As mentioned previously, in
anticipation of the U.S. Proceedings and of these proceedings, the Waiver Agreement was executed in respect of the Securitization Program.  
 
    305.             ACI seeks an order authorizing ACI to
continue the Securitization Program in accordance with the Waiver Agreement.  
 
    306.             As the Waiver Agreement only provides for the continuation of the Securitization Program for a period of 45 days following the filing
of these proceedings, the ACI Group and its advisors have contacted several financial institutions in Canada and the United States in order to secure the continuation of the Securitization Program or the implementation of a replacement facility.
 
 
    307.             The Abitibi Petitioners seek access to the funding proposed to be provided by the Securitization Program in order to assure available sources of working capital and financing to carry on the operation of their
businesses. Specifically, continued performance of the Securitization Program will permit ACI to continue selling the Receivables to ACUSFC, allowing ACI to continue its prepetition practice of converting Receivables to cash as soon as possible to
provide cash flow necessary for various business purposes of the ACI Group. The ACI Group's ability to maintain business relationships with their vendors, suppliers and customers, to pay their employees, to purchase and supply new inventory and
otherwise finance their operations, is essential to the ACI Group's continued viability. In addition, the ACI Group's need for financing is immediate. In the absence of the proposed financing, serious and irreparable harm to the ACI Group's business
operations and its estate could occur which may include third parties declining to conduct business dealings with the ACI Group. The preservation, maintenance and enhancement of the going concern value of the ACI Group are of the utmost significance
and importance to a successful reorganization of the Abitibi Petitioners under the CCAA.  
 
    308.
             Once the continuation or replacement of the Securitization Program has been secured, the Abitibi Petitioners will seek an
order from this Court authorizing the continuation or replacement of the Securitization Program.  
 
    309.             While it is anticipated that the ACI Group will be able to operate for a period of time with the continuation
of the Securitization Program, further financing support will be needed to provide the ACI Group with the financing it needs to see the restructuring process through to a successful conclusion.  
 
    310.             ACI, with the assistance of its financial advisor, has been in advanced discussions and negotiations regarding the possibility of DIP financing for the Abitibi Petitioners during these CCAA proceedings. As of the
date hereof, no such financing has been agreed upon. ACI intends to continue discussions and negotiations to try and finalize a DIP financing arrangement to fund its operations during these CCAA proceedings. ACI hopes to be in a position to bring a
DIP proposal forward for approval by this Court within approximately 30 days.  
 
    311.
           The Abitibi Petitioners expect to be able to manage their operations based on expected cash flow in the near term but expect that a
DIP facility providing approximately $ 100  million in operating funding will be required if operations are to be maintained at the current level for the longer term.

  
 
  312.             The Senior Notes have approximately US$441.4 million outstanding but are secured by pledges of assets in respect of which sale agreements exist (shares of MPCo and ACH for gross proceeds of $600 million and
$197 million respectively) as well as pledges of 11 pulp and paper mills and certain other equipment and intellectual property.  
 
   
313.             An amount of approximately $  349.8  million is outstanding under the Term Loan. As appears from the E&Y Report, the borrowing base certificate issued by ACCC on  February 28, 2009 
indicates a collateral value of $471 million for inventory and accounts receivable. This represents a surplus of collateral value of $124 million. In addition, the Term Loan is secured by: 
  
   (a)                 
the indirect pledge of the equity interest (52.5%) in Augusta Newsprint Mill which is a 423,000 MT mill that sells 100% of its product to ACSC at arm's length market determined rates;  (b)
                 the currently idled Alabama River newsprint and recycling facility with a capacity of 265,000 MT;
 (c)                   a guarantee  from the Abitibi-Consolidated Corporation which owns a 384,000 MT currently idled recycling facility in Lufkin, Texas;  (d)                  a guarantee  from DCorp.    
  8.3.8.         
Necessity of Obtaining DIP Financing and Continuing the Securitization Program 
    314.             The BI DIP Facility and the continuation of the Securitization Program sought by the Petitioners are critical to the ongoing operations
and restructuring of the ABH Group, the whole as set out in the E&Y Report (Exhibit R-   21   ).  
 

   315.             The BI DIP Facility and the
Securitization Program are beneficial to the Petitioners, to the creditor body as a whole and to the larger community of stakeholders. The BI DIP Facility and the Securitization Program will allow the ABH Group to continue its operations as a going
concern and preserve value to the benefit of the ABH Group's creditors, employees and other stakeholders. It is the intention of the ABH Group to seek and obtain the approval of the BI DIP Facility by the U.S. Bankruptcy Court.  
 
    316.             Despite the current liquidity crisis it is facing, the ABH Group has a viable business and a strong basis for a successful restructuring.  
 
    317.             Without the BI DIP Facility and the
Securitization Program, the Petitioners would (a) have no access to operating credit; (b) not be able to operate in the ordinary course; and (c) not be able to satisfy their ongoing obligations to their employees, landlords, suppliers and other
stakeholders.   
 
 
    318.             Absent the BI DIP Facility and the Securitization Program, the ABH Group will have to immediately interrupt its operations for an
indefinite period of time. The consequences of such a shut-down would include the following:  
 
   (a)                  immediate idling of all Canadian pulp and paper mills of the ABH Group. These mills are currently all
generating positive cash flows. In the event of a shut-down, the conservatory costs to be incurred are estimated to be between $2 million and $5 million per mill per month;  (b)                  immediate idling of all Canadian sawmills of the ABH Group. While most of these sawmills currently generate
negative cash flows, conservatory costs which are substantially higher than the cashflow shortfall are to be expected in the event of a shutdown;  (c)                   the vast majority of the ABH Group's Canadian  8,996   unionized employees and a significant portion of its   2,272   non-unionized employees would be laid-off;  (d)                  950 regional suppliers and 500 specialized forest contractors supplying the
ABH Group's Canadian operations would be directly affected by the shutdown;  (e)                 
 in addition, about 1,700 forest workers and about 2,300 independent workers would see their contracts either terminated or not renewed;  (f)                    24 municipalities in Québec and 12 municipalities in Ontario where the ABH Group has
operations would be severely impacted;  (g)                 
approximately 50 external sawmills in Québec and Ontario would have to either close or shutdown for an indefinite period of time;  (h)                  several North American newspapers (including the New York Daily News, The New York Times, The Washington
Post, the Chicago Tribune, the Globe and Mail, La Presse and the Journal de Montréal) which rely upon a frequent or just-in-time supply of newsprint from the Canadian operations of the ABH Group may not be in a position to publish for
several days or weeks. In the event of an interruption of operations, it is expected that these customers would ultimately seek to secure alternate sources of supply; and  (i)                    several customers in the specialty paper segment (Québecor World, Transcontinental, etc.)
and wood products segment (Rona, Home Depot, etc.) would face critical shortages of supply which would directly affect their operations. In the event of an interruption of operations, it is expected that these customers would seek to secure
alternate sources of supply.     319.             An interruption of the Canadian operations of the ABH Group would drastically depreciate the value of the business and assets of the ABH Group. In addition, an interruption of the ABH Group's business would certainly give rise to large
number of claims in damages representing huge potential liabilities, which would significantly dilute recoveries for creditors.  
 
 
   
320.            As appears form the foregoing and the E&Y Report (Exhibit  R- 21 ), the benefits of authorizing the BI DIP Facility and the continuation of the Securitization Program outweigh the inconveniences, if any,
suffered by the creditors of the Petitioners. 
  
  8.4.               Directors Indemnification and Charge 
    321.             A successful restructuring of the Petitioners will only be possible with the continued
participation of their directors and officers. These executives are essential to the ongoing viability of the Petitioners' business, and the successful restructuring thereof.  
 
    322.             Even though the Petitioners intend to
comply with all applicable laws and regulations, the Petitioners' directors and officers may nevertheless be concerned about the potential for their personal liability in the context of the present restructuring.  
 
    323.             Absent the protections sought in the conclusions of the present Petition, the Petitioners are concerned that their directors or officers will be advised to resign their posts, which would jeopardize the continuation
of the Petitioners' business operations, and their successful restructuring.  
 
    324.             Accordingly, the Petitioners request that the Initial Order to be granted pursuant hereto include the protections sought in the
conclusions of the present Petition, namely, the orders related to the indemnification and charge in favour of their directors and officers.  
 
    325.             The Abitibi Petitioners seek a $ 
75  million D&O Charge (the "Abitibi D&O Charge"), which shall only affect their assets, the whole as set forth more fully under Section  53  of the conclusions of this Petition. The amount of the Abitibi D&O Charge was established taking into account hourly and salaried payroll, sales and commissions, vacation pay and sales
and other taxes. 
  
    326.             The Bowater Petitioners seek a $  25  million D&O Charge (the
"Bowater D&O Charge"), which shall only affect their assets, the whole as set forth more fully under Section  54  of the conclusions of the present Petition. The amount of
the Bowater D&O Charge was established taking into account hourly and salaried payroll, sales and commissions, vacation pay and sales and other taxes. 
  
  8.5.               Appointment of Financial
Advisor 
    327.             The ACI
Group also seeks an order approving the appointment of BMO Nesbitt Burns Inc. ("BMO Capital Markets") as Canadian financial advisor, for the purpose of assisting the ABH Group in maximizing value for all constituents in the context
of the present restructuring.  
 
    328.             On March 31, 2009, ACI and BMO Capital Markets signed a letter agreement (the "Engagement Letter"). The Engagement
Letter is communicated as Exhibit R-   24   ;  
 
    329.             Pursuant to the Engagement Letter, BMO Capital Markets has agreed, subject to the
approval of this Court, to provide its expertise, advice services and assistance to the ACI Group in connection with the pursuit of (i) a Restructuring (as defined therein), in which claims of creditors are compromised and the existing
creditors and/or stakeholders retain a direct or indirect interest, (ii) a DIP Financing (as defined therein) and (iii) a Financing (as defined therein).  
 
  
 
  330.             BMO Capital Markets has been retained to provide, among other things, the following key financial advisory and investment bank services:  
 
   (a)                  assess the potential for and feasibility of a Restructuring, a DIP Financing and a
Financing;  (b)                  advise and assist the ACI Group in
the financial aspects (other than matters related to creditor claims) of implementing a Restructuring, a DIP Financing and Financing;  (c)                   advise and assist in preparing solicitation and due diligence materials (including, as appropriate a
web-based and physical data room); and  (d)                 
contact prospective investors for a Restructuring, a DIP Financing and a Financing and coordinate, advise and assist in the negotiations with such investors (including coordinating prospective investors due diligence activities).     331.             As consideration for the provision of
such services, pursuant to the Engagement Letter, ACI agreed to pay certain fees to BMO Capital Markets, including a retention fee of $350,000 (the "Retention Fee"), a monthly work fee of $200,000 per month until the termination of
the Engagement Letter (the "Work Fee"), a Financing fee base on the Commitment amount of any DIP Financing (the "DIP Financing Fee"), a variable exit financing fee based on the gross cash proceeds of Financing (the
"Financing Fee"). Additionally, the Engagement Letter provides for the payment of a completion fee upon a successful Restructuring (the "Completion Fee"). The calculation of the Completion Fee in connection with
successful Restructuring will be based on the amount of ACI secured and unsecured debt and any other claims settled in the Restructuring process.  
 
    332.             The payments owing to BMO Capital Markets
in respect of the Retention Fee, the Work Fee and, the DIP Financing Fee are to be secured by the Administra tion Charge (as defined below) sought by the Petitioners.  
 
    333.             The Monitor has reviewed the Engagement
Letter and supports the above mentioned engagement of BMO Capital Markets.  
 
  8.6.               Foreign Proceedings 
    334.
             As mentioned previously, some of the Petitioners conduct business in the United States.  
 
    335.             Following the issuance of the Initial Order contemplated in this Petition, ACI and ACCC intend to file proceedings under Chapter 15 of the U.S. Bankruptcy Code seeking recognition of the Petitioners' CCAA
proceedings as a foreign main proceeding under applicable law. Other Petitioners may be required to do so.  
 
 
   
  8.7.               Other Relief 
  8.7.1.          Recognition of ABH's U.S. Proceedings 
  
 336.             As mentioned above, the 18.6
Petitioners seek, inter alia, the recognition in Canada of the automatic statutory stay of proceedings resulting from its filing of a voluntary Petition for relief under Chapter 11 of the U.S. Bankruptcy Code.  
 
   
  8.7.2.          Advances to Petitioners 
    337.            In order to ensure that each individual Petitioner does not fund, at the expense of its creditors, the operations of another entity, the
Petitioners seek the granting of secured charges, the whole as set forth in the Sections  63 to 71  of the conclusions of this Petition. 
  
   
  8.7.3.          Cash management 
    338.             In order to ensure that the Petitioners can continue to access their existing bank accounts and cash management systems as described
herein, the Petitioners seek the relief set forth in paragraph 20 of the conclusions of this Petition.  
 
  

  8.7.4.          Administration Charges 
    339.            The Abitibi Petitioners seek a
Cdn$ 6  million administration charge the ("Abitibi Administration Charge"), which shall affect their assets, the whole as set forth in paragraph
 76 of the conclusions of this Petition.  
 
    340.            The Bowater Petitioners seek a Cdn$ 2  million administration
charge the ("Bowater Administration Charge"), which shall affect their assets, the whole as set forth in paragraph  77 of the conclusions of this Petition.  
 
   
  8.7.5.          Bowater Adequate Protection Charge 
    341.             The Bowater Petitioners seek a charge the ("Bowater Adequate Protection Charge"), which shall affect their assets, the
whole as set forth in paragraph 68 of the conclusions of this Petition.  
 
  9.                     CONCLUSIONS 
    342.            The Initial Order being sought by the Petitioners is based on the standard CCAA Initial
Order issued by the Superior Court of Québec, Commercial Division, while any changes thereto are underlined in the Draft Initial Order communicated as  Exhibit R- 25 . 
  
    343.             For the reasons set forth above, the Petitioners believe it is both appropriate and necessary that the relief being sought be granted.
With such relief, the Petitioners will be able to restructure their business and affairs to maximize long term value for the benefit of all stakeholders.  
 
 
    344.             Considering the urgency of the situation,
the Petitioners respectfully submit that the notices given for the presentation of this Petition are proper and sufficient.  
 
    345.             The Petitioners respectfully submit that this Petition should be granted in accordance
with its conclusions.  
 
    346.             The present Petition is well founded in fact and in law.  
 
 
  
   
  WHEREFORE, MAY THIS
COURT: 
    1.                  
GRANT  this Petition. 
 
    2.                   ISSUE  an
order pursuant to Sections 4, 5, 11 and 18.6 of the CCAA (the "Order"), divided under the following headings: 
 
   (a)
                Service  (b)                Application of the CCAA  (c)                 Effective Time  (d)                Plan of Arrangement  (e)                 Recognition of U.S. Proceedings  (f)                  Procedural Consolidation  (g)                Stay of Proceedings against the Petitioners, the Partnerships, the Property, the Directors or others 
(h)                Possession of Property and Carrying on Business 
(i)                  Securitization Program  (j)                  Restructuring  (k)                Directors Indemnification and Charge  (l)                  BCFPI DIP Financing  (m)              Inter-Company Advances  (n)
                Bowater Adequate Protection Charge  (o)
               Powers of the Monitor  (p)                Appointment of Information Officer in Respect of U.S. Proceedings    
   (q)                Approval and Appointment of Financial Advisor  (r)                 Priorities and General Provisions Relating to CCAA
Charges  (s)                 General  (t)                  Effect, Recognition and Assistance   
  Service 
    3.                   EXEMPT  AbitibiBowater Inc. ("ABH"), Abitibi-Consolidated Inc. ("ACI"), the Petitioners listed on Schedule "A" hereto (collectively
with ACI, the "Abitibi Petitioners"), Bowater Canadian Holdings Inc. ("BCHI") and the Petitioners listed on Schedule "B" hereto (collectively with BCHI, the "Bowater Petitioners") from
having to serve the Petition and from any notice of presentation. 
 
  Application of the CCAA 
    4.                   DECLARE  that the Abitibi Petitioners and the Bowater
Petitioners (collectively the "Petitioners") are debtor companies to which the CCAA applies. 
 
  
  Effective time 
    5.                   DECLARE  that from immediately after midnight (Montréal time) on the day prior to this Order (the "Effective Time") to the time of the granting of this Order, any act or action taken or notice given by any Person in respect of
the Petitioners, the 18.6 Petitioners, the Directors or the Property (as those terms are defined hereinafter), are deemed not to have been taken or given, as the case may be, to the extent such act, action or notice would otherwise be stayed after
the granting of this Order. 
 
  
  Plan of Arrangement 
    6.                   ORDER  that the Petitioners shall file with this Court
and submit to their creditors one or more plans of compromise or arrangement under the CCAA (collectively, the "Plan") between, among others, the Petitioners and one or more classes of their creditors as the Petitioners may deem
appropriate, on or before the Stay Termination Date (as defined hereinafter) or such other time or times as may be allowed by this Court.  
 
  
  Recognition of U.S. Proceedings 
  
 7.                   ORDER AND DECLARE that the proceedings (the "US Proceedings") commenced by ABH and the Petitioners listed on Schedule "C" hereto (collectively, the
"18.6 Petitioners") under Chapter 11 of the United States  
  Code in the United States Bankruptcy Court for the District
of Delaware (the "US Court") be and are hereby recognized as foreign proceedings for purposes of Section 18.6 of the CCAA. 
 
    8.                   DECLARE  that the 18.6 Petitioners are debtor companies within the meaning of the CCAA and, as such, are entitled to relief under Section 18.6 of the CCAA. 
 
 
  
  Procedural
Consolidation 
    9.                  
ORDER  that the consolidation of these CCAA proceedings in respect of the Abitibi Petitioners, the Bowater Petitioners and the 18.6 Petitioners (collectively, the
"Petitioners") shall be for administrative purposes only and shall not effect a consolidation of the assets and property of the Petitioners including, without limitation, for the purposes of any Plan or Plans that may be hereafter
proposed. 
 
  Stay of Proceedings against the Petitioners, the Partnerships,
the Property, the Directors or others 
    10.              
ORDER that, until and including May 15 , 2009, or such later date as the Court may order (the "Stay Termination
Date", the period from the date of this Order to the Stay Termination Date being referred to as the "Stay Period"), no right, legal or conventional, may be exercised and no proceeding, at law or under a contract, by reason
of this Order or otherwise, however and wherever taken (collectively the "Proceedings") may be commenced or proceeded with by anyone, whether a person, firm, partnership, corporation, stock exchange, government, administration or
entity exercising executive, legislative, judicial, regulatory or administrative functions (collectively, "Persons" and, individually, a "Person") against or in respect of the Petitioners, the 18.6 Petitioners and
the entities listed on Schedule "D" hereto (the "Partnerships"), or any of the present or future property, assets, rights and undertakings of the Petitioners, the 18.6 Petitioners or the Partnerships, of any nature and in
any location, whether held directly or indirectly by the Petitioners, the 18.6 Petitioners or the Partnerships, in any capacity whatsoever, or held by others for the Petitioners, the 18.6 Petitioners or the Partnerships (collectively, the
"Property"), and all Proceedings already commenced against the Petitioners, the 18.6 Petitioners, the Partnerships or any of the Property, are stayed and suspended until the Court authorizes the continuation thereof, the whole
subject to the provisions of the CCAA. 
 
    11.               ORDER  that, without limiting the generality of the foregoing, during the Stay
Period, all Persons having agreements, contracts or arrangements with the Petitioners, the 18.6 Petitioners, the Partnerships or in connection with any of the Property, whether written or oral, for any subject or purpose: 
 
   (a)                are restrained from accelerating, terminating, cancelling, suspending, refusing to modify or extend on reasonable terms such agreements, contracts or arrange ments or the rights of the Petitioners, the 18.6 Petitioners, the Partnerships or
any other Person thereunder;  (b)                are restrained
from modifying, suspending or otherwise interfering with the supply of any goods, services, or other benefits by or to such Person thereunder (including, without limitation, any directors' and officers' insurance, any telephone numbers, any form of
telecommunications service, any oil, gas, electricity or other utility supply); and  (c)                
shall continue to perform and observe the terms and conditions contained in such agreements, contracts or arrangements, so long as the Petitioners, the 18.6 Petitioners or the Partnerships pay the prices
or charges for such goods and services received after the date of this Order as such prices or charges become due in accordance with the law or as may be hereafter negotiated (other than deposits whether by way of cash, letter of credit or
guarantee, stand-by fees or similar items which the Petitioners, the 18.6 Petitioners or the Partnerships shall not be required to pay or grant);  
     Unless the prior written consent of
the Petitioners, the 18.6 Petitioners or the Partnerships, as well as that of the Monitor, is obtained or leave is granted by this Court.     12.
              ORDER  that, without limiting the generality of the foregoing and subject
to Section 18.1 of the CCAA, if applicable, cash or cash equivalents placed on deposit by the Petitioners, the 18.6 Petitioners or the Partnerships with any Person during the Stay Period, whether in an operating account or otherwise for itself
or for another entity, shall not be applied by such Person in reduction or repayment of amounts owing to such Person as of the date of this Order or due on or before the expiry of the Stay Period or in satisfaction of any interest or charges
accruing in respect thereof; however, this provision shall not prevent any financial institution from: (i) reimbursing itself for the amount of any cheques drawn by the Petitioners, the 18.6 Petitioners or the Partnerships and properly honoured
by such institution, or (ii) holding the amount of any cheques or other instruments deposited into the Petitioners',  the 18.6 Petitioners' or the Partnerships' account until those cheques or other instruments have been honoured by the
financial institution on which they have been drawn. 
 
    13.               ORDER  that, notwithstanding the foregoing, any Person who provided any kind of
letter of credit, bond or guarantee (the "Issuing Party") at the request of the Petitioners, the 18.6 Petitioners or the Partnerships shall be required to continue honouring any and all such letters, bonds and guarantees, issued on
or before the date of this Order; however, the Issuing Party shall be entitled, where applicable, to retain the bills of lading or shipping or other documents relating thereto until paid therefore.  
 
    14.              
DECLARE  that, to the extent any rights, obligations, or time or limitation periods, including, without limitation, to file grievances, relating to the Petitioners, the
18.6 Petitioners or Partnerships or any of the Property may expire, other than the term of any lease of real property, the term of such rights or obligations, or time or limitation periods shall hereby be deemed to be extended by a period equal to
the Stay Period. Without limitation to the foregoing, in the event that the Petitioners, the 18.6 Petitioners or the Partnerships become bankrupt or a receiver within the meaning of paragraph 243(2) of the Bankruptcy and Insolvency Act
(Canada) (the "BIA") is appointed in respect of the Petitioners, the 18.6 Petitioners or the Partnerships, the period between the date of this Order and the day on which the Stay Period ends shall not be calculated in respect of the
Petitioners, the 18.6 Petitioners or the Partnerships in determining the 30-day periods referred to in Sections 81.1 and 81.2 of the BIA. 
 
    15.               ORDER  that no Person may commence, proceed with or enforce any Proceedings against any former, present or future director or officer of the Petitioners, the 18.6 Petitioners, the Partnerships or any person that,
by applicable legislation, is treated as a director of the Petitioners, the 18.6 Petitioners or the Partnerships, or that will manage in the future the business and affairs of the Petitioners, the 18.6 Petitioners or the Partnerships (each, a
"Director", and collectively the "Directors") in respect of any claim against such Director that arose before this Order was issued and that relates to obligations of the Petitioners, the 18.6 Petitioners or the
Partnerships for which such Director is or is alleged to be liable (as provided under Section 5.1 of the CCAA) until further order of this Court or until the Plan, if one is filed, is refused by the creditors or is not sanctioned by the Court.
 
 
 
    16.              
ORDER  that no Person shall commence, proceed with or enforce any Proceedings against any of the Directors, officers, employees, legal counsel or financial advisers of
the Petitioners, the 18.6 Petitioners, the Partnerships, the Monitor, the  BI DIP Lenders (as defined hereinafter) or the legal counsel or financial advisers to the Monitor or to the BI DIP
Lenders, for or in respect of the Restructuring (as defined hereinafter) or the formulation and implementation of the Plan without first obtaining leave of this Court, upon seven days written notice to the Petitioners' and the Partnerships' ad
litem counsel and to all those referred to in this paragraph whom it is proposed be named in such Proceedings. 
 
  Possession of Property and Carrying on Business 
    17.               ORDER  that, subject to the terms of this Order, the Petitioners shall remain in
possession of their Property until further order in these proceedings. 
 
    18.               ORDER  that the Petitioners and the Partnerships shall continue to carry on their
business and financial affairs, including the business and affairs of any person, firm, joint venture or corporation owned by a Petitioner or in which a Petitioner owns an interest, in a manner consistent with the commercially reasonable
preservation thereof. 
 
    19.               ORDER  that the Petitioners and Partnerships shall be authorized and empowered to
continue to retain and employ the employees, consultants, individual self-employed contractors, agents, experts, accountants, counsel and such other persons (collectively "Assistants") currently retained or employed by them, with
liberty to retain such further Assistants as they deem reasonably necessary or desirable in the ordinary course of business or for the carrying out of the terms of this Order. 
 

   20.               ORDER  that the Petitioners and the Partnerships shall be entitled to continue to utilize the existing centralized cash management systems currently in place as described in this Petition or, subject to the terms
of the BI DIP Documents (as defined hereinafter), replace them with other substantially similar central cash management system(s) (together, the "Cash Management System") and that any present or future bank providing the Cash
Management System shall not be under any obligation whatsoever to inquire into the propriety, validity or legality of any transfer, payment, collection or other action taken under the Cash Management System, or as to the use or application by the
Petitioners or the Partnerships of funds transferred, paid, collected or otherwise dealt with in the Cash Management System, shall be entitled to provide the Cash Management System without any liability in respect thereof to any Person other than
the Petitioners and the Partnerships, pursuant to the terms of the documentation applicable to the Cash Management System, and shall be, in its capacity as provider of the Cash Management System, an unaffected creditor under the Plan with regard to
any claims or expenses it may suffer or incur in connection with the provision of the Cash Management System. The Monitor shall review and monitor the Cash Management System and report to this Court from time to time. 
 
 
    21.              
ORDER  that the Petitioners and the Partnerships shall be entitled but not required to pay the following expenses whether incurred prior to or after this Order:

 
   (a)                all outstanding and future wages, salaries, commissions, vacation pay, current pension contributions and other benefits, reimbursement of expenses (including, without limitation, amounts charged by employees to credit
cards) and other amounts payable to former, current or future employees, officers or directors on or after the date of this Order, in each case incurred in the ordinary course of business and consistent with existing compensation policies and
arrangements;  (b)                all outstanding and future
amounts owing to or in respect of individuals working as independent contractors in connection with the Petitioners' business;  (c)                 all outstanding amounts payable to third party customer brokers or agents on or after the date of this
Order;  (d)                all outstanding amounts payable on or
after the date of this Order in respect of (i) customer programs including, inter alia, rebates, adjustments, performance and volume discounts and (ii) billing errors, including duplicative invoicing, improper invoicing, duplicative
payment, mispricing and various other billing and payment errors;  (e)                 the fees and disbursements of any Assistants retained or employed by the Petitioners or the Partnerships in respect of these proceedings, at their standard rates and charges; and  (f)                  the interest, fees and expenses payable under the Canadian Credit
Agreement (as defined hereinafter).     22.              
ORDER  that notwithstanding any other provision of this Order, the Petitioners and the Partnerships shall not make any past service contributions or special payments to
funded pension plans maintained by the Petitioners or the Partnerships (the "Pension Plans") during the Stay Period, pending further order of this Court. 
 
    23.               ORDER  that none of the Petitioners or the Partnerships, or their respective officers or directors shall incur any obligation, whether by way of debt, damages for breach of any duty, whether statutory, fiduciary,
common law or otherwise, or for breach of trust, nor shall any trust be recognized, whether express, implied, constructive, resulting, deemed or otherwise, as a result of the failure of any Person to make any contribution or payments other than
current cost contribution obligations ("Current Contributions") during the Stay Period that they might otherwise have become required to make to any pension plans maintained by a Petitioner or by a Partnership. Notwithstanding the
foregoing and any other provision of this Order, the payment of Current Contributions shall be subject to the terms of the BI DIP Documents. 
 
 
  24.               ORDER  that if any claim, lien, charge or trust arises as a result of the failure of any Person to make any contribution or payment (other than Current Contributions) during the Stay Period that such Person might
otherwise have become required to make to any Pension Plans but for the stay provided for herein, no such claim lien, charge or trust shall be recognized in these proceedings or in any subsequent receivership, interim receivership or bankruptcy of
any of the Petitioners or the Partnerships as having priority over the claims of the CCAA Charges as set out in this Order.  
 
   
25.               ORDER  that, except as
otherwise provided to the contrary herein, the Petitioners and the Partnerships shall be entitled but not required to pay all reasonable expenses incurred by them in carrying on the business in the ordinary course from and after the date of this
Order, and in carrying out the provisions of this Order, which expenses shall include, without limitation: 
 
   (a)                all expenses and capital expenditures reasonably necessary for the preservation of their Property or the
business including, without limitation, payments on account of insurance (including directors and officers insurance), maintenance and security services; and  (b)                payment for goods or services actually supplied to the Petitioners or the Partnerships following the date of
this Order.     26.               ORDER  that, except as otherwise provided to the contrary herein, the Petitioners and the Partnerships shall remit, in accordance with legal requirements, or pay : 
 
   (a)               
any statutory deemed trust amounts in favour of the Crown in right of Canada or of any Province thereof or any other taxation authority which are required to be deducted from employees' wages, including,
without limitation, amounts in respect of (i) employment insurance, (ii) Canada Pension Plan, (iii) Québec Pension Plan, and (iv) income taxes;  (b)                amounts accruing and payable by a Petitioner or a Partnership in respect of employment insurance,
Canada Pension Plan, workers compensation, employer health taxes and similar obligations of any jurisdiction with respect to employees;  (c)                 all goods and services or other applicable sales taxes (collectively, "Sales Taxes")
required to be remitted by the Petitioners or the Partnerships in connection with the sale of goods and services by the Petitioners or the Partnerships, but only where such Sales Taxes are accrued or collected after the date of this Order, or where
such Sales Taxes were accrued or collected prior to the date of this Order but not required to be remitted until on or after the date of this Order; and  
   (d)                any amount payable to the Crown in right of Canada or of any Province thereof or any political subdivision
thereof or any other taxation authority in respect of municipal realty, municipal business or other taxes, assessments or levies of any nature or kind which are entitled at law to be paid in priority to claims of secured creditors and which are
attributable to or in respect of the carrying on of the business by the Petitioners or the Partnerships.     27.               ORDER  that, except as specifically permitted herein, the Petitioners and the
Partnerships are hereby directed, until further Order of this Court: (a) to make no payments of principal, interest thereon or otherwise on account of amounts owing by the Petitioners or Partnerships to any of their creditors as of this date
unless such amounts have been approved by the Monitor; (b) to grant no security interests, trust, liens, charges or encumbrances upon or in respect of any of their Property; and (c) to not grant credit or incur liabilities except in the
ordinary course of the business. 
 
    28.               ORDER  that the Petitioners and the Partnerships are authorized to pay any
pre-filing amounts outstanding and to complete any outstanding transactions and engage in new transactions with each other and with any of their respective affiliates and other entities, partnerships and joint ventures within and among the ABH Group
(as defined hereinafter) in which they have a direct or indirect ownership interest (the Petitioners collectively with Abitibi-Bowater US Holding LLC, Bowater Newsprint South LLC and Bowater Incorporated and their respective subsidiaries are
referred to herein as the "ABH Group") and the Petitioners and the Partnerships may, inter alia,  continue on and after the date hereof to buy and sell goods and services and allocate, collect and pay costs, including
without limitation head office expenses and shared goods and services, from and to each other and from and to the other members of the ABH Group in the ordinary course of business on terms consistent with existing arrangements or past practice
(including without limitation, pursuant to the Securitization Program Agreements (as defined hereinafter) and sales of inventory by ACI to ACSC (as defined hereinafter). 
 
  
  Securitization Program 

   29.               ORDER  that the execution and delivery by ACI of the " Omnibus Amendment No. 5 to Amended and Restated Receivables Purchase Agreement and Amendment No. 3 to Amended and
Restated Purchase and Contribution Agreement and Waiver Agreement ", Exhibit R- 19 in support of the Petition
 , (the "Waiver Agreement") to: 
 
  (a)
               a certain Amended and Restated Receivables Purchase Agreement, dated as of January 31, 2008 (as
heretofore amended, the "RPA"),  Exhibit R- 17 in support of the Petition ,
among Abitibi-Consolidated U.S. Funding Corp. ("ACUSFC" ‐ a wholly-owned subsidiary of ACSC that is not a debtor in the US Proceedings), Eureka Securitisation, plc ("Eureka"), Citibank, N.A.
("Citibank"), Citibank, N.A. London Branch (the "Securitization Agent"), ACI, in its capacity as Subservicer and an Originator, and Abitibi-Consolidated Sales Corporation ("ACSC", a debtor in the US
Proceedings), in its capacity as Servicer and an Originator; and  
  (b)               
a certain Amended and Restated Purchase and Contribution Agreement, dated as of January 31, 2008 (as heretofore amended, the "PCA"),  Exhibit R- 16 in support of the Petition , among ACI and ACSC as Sellers and ACUSFC as Purchaser
(the terms " Receivables " and  " Related Security " shall have the meanings
attributed thereto in the PCA),    as well as all related documents and instruments executed or to be executed and delivered in connection therewith (as amended by the Waiver Agreement,
collectively referred to as the "Receivables Agreements") are hereby ratified and approved.    30.               ORDERS that ACI is hereby authorized and empowered to perform or continue to perform its obligations,
including the sale and servicing of Receivables and all Related Security, under the Receivables Agreements and under the following agreements to which it is a party, Exhibit R- 18 
in support of the Petition: 
 
   (a)                the Undertaking Agreement (Servicer) dated as of October 27, 2005 by ACI in favour of Eureka, Citibank
and the other Banks (as defined in the RPA) that are party to the RPA, as amended;  (b)               
the Undertaking Agreement (Originator) dated as of October 27, 2005 by ACI in favour of ACI Funding, as amended;  (c)                 the Deposit Account Control Agreement dated as of January 31, 2008 among ACUSFC, ACI, ACSC,
Citibank and the Securitization Agent;  (d)                the
Blocked Accounts Agreement dated as of October 27, 2005 among ACI, ACSC, the Securitization Agent, Royal Bank of Canada and ACUSFC;  (e)                 the Agreement Re: Pledged Deposit Accounts dated as of October 27, 2005 among ACSC, ACI, ACUSFC,
the Securitization Agent and LaSalle Bank National Association;  (f)                  the Second Amended and Restated Four Party Agreement for Sold Accounts (General) dated as of January 31, 2008 among Export Development Canada and Compagnie Française d'Assurance pour le Commerce
Extérieur ‐ Canada Branch, ACI, ACUSFC, the Securitization Agent and Citibank;  (g)               
the Intercompany Agreement dated as of December 20, 2007 between ACI and ACSC; and  (h)                the Accounts Receivable Policy (Shipments) General Terms and Conditions, plus the Coverage Certificate
effective September 1, 2008 (together with all schedules and endorsements thereto) issued by Export Development Canada and Compagnie Française d'Assurance pour le Commerce Extérieur ‐ Canada Branch to ACI;    (collectively with the Receivables Agreements, the "Securitization Program Agreements").  
    31.               ORDER  that ACI is hereby authorized and empowered to
sell the relevant Receivables and Related Security to ACUSFC pursuant to and in accordance with the Securitization Program Agreements, and such sale shall be free and clear of any lien, claims, charges or encumbrances and other interests of any of
ACI, ACSC, the Petitioners or their respective creditors, including any charges created pursuant to this Order. 
 
    32.               DECLARE  that the transfers by
ACI of its Receivables and Related Security to ACUSFC under the PCA shall constitute true sales under applicable non-bankruptcy law and are hereby deemed true sales and were or will be for fair consideration. Upon the transfer of the Receivables to
ACUSFC, the Receivables and Related Security did (with respect to transfers occurring prior to the Effective Time as defined in the RPA) and will (with respect to transfers occurring on or after the date hereof) become the sole property of ACUSFC,
and none of the Petitioners, nor any creditors of the Petitioners, shall retain any ownership rights, claims, liens or interests in or to the Receivables and Related Security, or any proceeds therefrom including, without limitation, pursuant to any
theory of substantive consolidation or otherwise. 
 
    33.               DECLARE  that each Securitization Program Agreement
constitutes a valid and binding obligation of ACI, enforceable against ACI in accordance with its terms and that the terms and conditions of the Securitization Program Agreements have been negotiated in good faith and at arm's length and the
transfers made or to be made and the obligations incurred or to be incurred shall be deemed to have been made for fair or reasonably equivalent value and in good faith. 
 
    34.               DECLARE
 that upon the transfer by ACI pursuant to the Securitization Program Agreements neither the Receivables nor the Related Security, nor the proceeds thereof, shall constitute property of the patrimonies of any of the
Petitioners or their affiliates, including notwithstanding any intentional or inadvertent deposit of any proceeds of the Receivables in bank accounts owned or controlled by any of the Petitioners or their affiliates. 
 
    35.              
DECLARE  that notwithstanding: (i) these proceedings and any declaration of insolvency made herein; (ii) any bankruptcy application or bankruptcy motion filed
pursuant to the BIA in respect of the Petitioners and any bankruptcy order or any assignment in bankruptcy made or deemed to be made in respect of the Petitioners; (iii) proceedings taken by ACI under Chapter 15 of Title 11 of The United
States Code ("ACI's Chapter 15 Proceedings"); or (iv) the provisions of any federal or provincial statute, the transfers of Receivables and Related Security made by ACI pursuant to the Securitization Program Agreements and this
Order do not and will not constitute settlements, fraudulent preferences, fraudulent conveyances or other challengeable or reviewable transactions or conduct meriting an oppression remedy under any applicable law. 
 
    36.              
DECLARE  that t he performance by ACI, ACSC and ACUSFC of their respective obligations under the Securitization Program Agreements, and the
consummation of the transactions contemplated by the Securitization Program Agreements, and the conduct by ACI, ACSC and ACUSFC of their respective businesses, whether occurring prior to or subsequent to the Effective Time, do not, and shall not,
provide a basis for a substantive consolidation of the assets and liabilities of ACI and ACSC, or any of them, with the assets and liabilities of ACUSFC or a finding that the separate corporate identities of ACI, ACSC and ACUSFC may be ignored.
Notwithstanding any other provision of this Order, the Agent, Citibank, Eureka and the other parties thereto have agreed to enter into the Securitization Program Agreements in express reliance on ACUSFC being a separate and distinct legal entity,
with assets and liabilities separate and distinct from those of any of the Petitioners. 
 
 
    37.               DECLARE  that the transfers of Receivables and Related
Security by ACI pursuant to the Securitization Program Agreements and this Order shall be valid and enforceable as against all Persons, including, without limitation, any trustee in bankruptcy, receiver, receiver and manager or interim receiver of
the Petitioners, for all purposes. 
 
    38.               DECLARE , for greater certainty, that the Facility Termination Date and the Commitment Termination Date (as
each is defined in the Receivables Agreements) have not occurred as a consequence of the commencement of these proceedings, the US Proceedings, ACI's Chapter 15 Proceedings or the taking of corporate actions by ACI or ACSC to approve such
proceedings, or the failure of ACI or ACSC to pay any debts that are otherwise stayed by any  of the foregoing or the written admission by ACI or ACSC of its inability to pay such
debts. 
 
    39.               ORDER AND DECLARE that collections of Receivables and other funds which are
subject to the Deposit Account Control Agreement dated as of January 31, 2008, the Agreement Re: Pledged Deposit Accounts dated as of October 27, 2005 and the Second Amended and Restated Four Party Agreement for Sold Accounts
(General), dated as of January 31, 2008 referred to above, shall be processed and transferred pursuant to such deposit account agreements and each deposit bank party thereto is directed to comply therewith. 
 
    40.              
ORDER  that ACI is hereby authorized and empowered to make, execute and deliver all instruments and documents and perform all other acts
(including, without limitation, the perfection of ACUSFC's ownership interest in the Receivables) that may be required in connection with the Securitization Program Agreements and the transactions contemplated thereby; it being expressly
contemplated that pursuant to the terms of the Securitization Program Agreements, ACI and ACSC shall be expressly authorized and empowered to service, administer and collect the Receivables on behalf of ACUSFC pursuant to the Securitization Program
Agreements, and with respect to ACI, ACSC and ACUSFC, each shall be expressly authorized and empowered to make, execute and deliver all instruments and documents and perform all other acts that may be required in connection with the Securitization
Program Agreements and the transactions contemplated thereby. 
 
    41.               ORDER  that ACI is hereby authorized and empowered to use the proceeds of the
arrangements contemplated by the Securitization Program Agreements in the operation of the Petitioners' businesses, provided however, that the use of the proceeds are consistent with the terms of the Securitization Program Agreements, this Order or
as may otherwise be agreed in writing by the Securitization Agent. 
 
 
    42.              
 ORDER AND DECLARE t hat without limiting ACI's duty to comply with and fulfill any obligations under the Securitization Program Agreements,
 ACI shall perform and pay all indemnification and other obligations to the Securitization Agent, Eureka, Citibank and any other Indemnified Parties (as defined in the RPA) under the Securitization Program Agreements, all obligations to ACUFSC under
the Securitization Program Agreements, and all of its obligations in respect of the Insurance Policy (as defined in the RPA). 
 

   43.               ORDER AND DECLARE that, notwithstanding the terms of this Order, the parties to the Securitization Program Agreements other than ACI shall in that capacity be
unaffected in these proceedings and by any plan of compromise or arrangement proposed by any of the Petitioners under the CCAA or by any proposal filed by any of the Petitioners under the BIA, and for greater certainty,
paragraph 46(f) of this Order shall not apply to the Securitization Program Agreements. 
 
    44.               DECLARE  that this Order shall not stay or otherwise
apply to restrict in any way the exercise of any rights of any Person under any of the Securitization Program Agreements. 
 
    45.              
 ORDER AND DECLARE that subject to further order of this Court, no order shall be made varying, rescinding, or otherwise affecting paragraph 28
 hereof in respect of the Securitization Program, or inventory sales by ACI and the sale of inventory by ACI to ACSC and paragraphs  29 to 45 hereof or any other reference to the Securitization Program or the Securitization
 Program Agreements herein, unless either (a) notice of a motion for such order is served on the Securitization Agent and ACI by the moving party within seven (7) days after that party was served with this Order or (b) the Securitization
Agent and ACI apply for or consent to such order. 
 
  
  Restructuring 
    46.               DECLARE  that, to facilitate the
orderly restructuring of their business and financial affairs (the "Restructuring"), the Petitioners and Partnerships shall have the right, subject to approval of the Monitor or further order of the Court and to: 

   (a)                permanently or temporarily cease, downsize or shut down any of their operations or locations as they deem appropriate and make provisions for the consequences thereof in the Plan;  (b)
               pursue all avenues to market and sell, subject to subparagraph (c), their Property, in whole or
part;  (c)                 convey, transfer, assign, lease, or
in any other manner dispose of their Property, in whole or in part, provided that the price in each case does not exceed $ 10 million or $ 50 million  in the aggregate, and provided that Petitioners or Partnerships apply any proceeds thereof in accordance with the Interim Financing Documents (as defined hereinafter) and the Securitization Program Agreements; (d)                terminate the employment of such of their employees or
temporarily or permanently lay off such of their employees as they deem appropriate and, to the extent any amounts in lieu of notice, termination or severance pay or other amounts in respect thereof are not paid in the ordinary course, make
provision for any consequences thereof in the Plan, as the Petitioners or Partnerships may determine;    
   (e)                 subject to paragraphs  48 and 49 
hereof, vacate or abandon any leased real property or repudiate any lease and ancillary agreements related to any leased premises as they deem appropriate, provided that the Petitioners or Partnerships give the
relevant landlord at least seven days prior written notice, on such terms as may be agreed between the Petitioners or Partnerships and such landlord, or failing such agreement, to make provision for any consequences thereof in the Plan; and
(f)                  repudiate such of their agreements,
contracts or arrangements of any nature whatsoever, whether oral or written, as they deem appropriate, on such terms as may be agreed between the Petitioners or Partnerships and the relevant party, or failing such agreement, to make provision for
the consequences thereof in the Plan and to negotiate any amended or new agreements or arrangements.    47.               DECLARE  that, in order to facilitate the Restructuring, the Petitioners and
Partnerships may, subject to approval of the Monitor: 
 
   (a)                settle claims of customers and suppliers that are in dispute; and  (b)                subject to further orders from this Court, establish a plan for the retention of key
employees and the making of retention payments or bonuses in connection therewith.    48.               DECLARE  that, if leased premises are vacated or abandoned by the Petitioners
or Partnerships pursuant to subparagraph 46 (e), the landlord may take possession of any such leased premises without waiver
of, or prejudice to, any claims or rights of the landlord against the Petitioners or Partnerships , provided the landlord mitigates its damages, if any, and re-leases any such leased premises to third parties on such terms as
any such landlord may determine. 
 
    49.               ORDER  that the Petitioners and Partnerships shall provide to any relevant
landlord notice of the Petitioners' or Partnerships' intention to remove any fixtures or leasehold improvements at least seven days in advance. If the Petitioners or Partnerships have already vacated the leased premises, they shall not be considered
to be in occupation of such location pending the resolution of any dispute. 
 
    50.
              DECLARE  that, pursuant to sub-paragraph 7(3)(c) of the Personal
Information Protection and Electronic Documents Act, S.C. 2000, c.5, the Petitioners and Partnerships are permitted, in the course of these proceedings, to disclose personal information of identifiable individuals in their possession or control
to stakeholders or prospective investors, financiers, buyers or strategic partners and to their advisers (individually, a "Third Party"), but only to the extent desirable or required to negotiate and complete the Restructuring or
the preparation and implementation of the Plan or a transaction for that purpose, provided that the Persons to whom such personal information is disclosed enter into confidentiality agreements with the Petitioners or Partnerships binding them to
maintain and protect the privacy of such information and to limit the use of such information to the extent necessary to complete the transaction or Restructuring then under negotiation. Upon the completion of the use of personal information for the
limited purpose set out herein, the personal information shall be returned to the Petitioners or Partnerships or destroyed. In the event that a Third Party acquires personal information as part of the Restructuring or the preparation and
implementation of the Plan or a transaction in furtherance thereof, such Third Party may continue to use the personal information in a manner which is in all respects identical to the prior use thereof by the Petitioners or Partnerships.

 
  Directors' Indemnification and Charge 
 
    51.              
 ORDER  that, in addition to any existing indemnities, the Petitioners shall indemnify each of the Directors from and against the following
(collectively, "D&O Claims"): 
 
   (a)                all costs (including, without limitation, full defence costs), charges, expenses, claims, liabilities and
obligations, of any nature whatsoever, which may arise on or after the date of this Order (including, without limitation, an amount paid to settle an action or a judgment in a civil, criminal, administrative or investigative action or proceeding to
which a Director may be made a party), provided that any such liability relates to such Director in that capacity, and, provided that such Director (i) acted honestly and in good faith in the best interests of the Petitioners and Partnerships
and (ii) in the case of a criminal or administrative action or proceeding in which such Director would be liable to a monetary penalty, such Director had reasonable grounds for believing his or her conduct was lawful, except if such Director
has actively breached any fiduciary duties or has been grossly negligent or guilty of willful misconduct; and  (b)                all costs, charges, expenses, claims, liabilities and obligations relating to the failure of the Petitioners
or Partnerships to make any payments or to pay amounts in respect of employee or former employee entitlements to wages, vacation pay, termination pay, severance pay, pension or other benefits, or any other amount for services performed prior to or
after the date of this Order and that such Directors sustain, by reason of their association with the Petitioners as a Director, except to the extent that they have actively breached any fiduciary duties or have been grossly negligent or guilty of
willful misconduct.   The foregoing shall not constitute a contract of insurance or other valid and collectible insurance, as such term may be
used in any existing policy of insurance issued in favour of the Petitioners, the Partnerships or any of the Directors. 
    52.               DECLARE that, as security for the obligation of the Abitibi Petitioners to indemnify the Directors of the
Abitibi Petitioners pursuant to paragraph 51hereof, the Directors of the Abitibi Petitioners are hereby granted a hypothec on, mortgage of, lien on and security interest in the Property of the
Abitibi Petitioners (other than the Property subject to the Securitization Program Agreements) to the extent of the aggregate amount of $ 75 million (the "Abitibi
D&O Charge"), having the priority established by paragraphs  89 and  91 hereof. Such
Abitibi D&O Charge shall not constitute or form a trust. Such Abitibi D&O Charge, notwithstanding any language in any applicable policy of insurance to the contrary, shall only apply to the extent that the Directors of the Abitibi
Petitioners do not have coverage under any directors' and officers' insurance, which shall not be excess insurance to the Abitibi D&O Charge. In respect of any D&O Claim against any of the Directors of the Abitibi Petitioners (collectively,
the "Abitibi Respondent Directors"), if such Abitibi Respondent Directors do not receive confirmation from the applicable insurer within 21 days of delivery of notice of the D&O Claim to the applicable insurer,
confirming that the applicable insurer will provide coverage for and indemnify the Abitibi Respondent Directors, then, without prejudice to the subrogation rights hereinafter referred to, the Abitibi Petitioners shall pay the amount of the D&O
Claim upon expiry. Failing such payment, the Abitibi Respondent Directors may enforce the Abitibi D&O Charge provided that the Abitibi Respondent Directors shall reimburse the Abitibi Petitioners to the extent that they subsequently receive
insurance benefits for the D&O Claim paid by the Abitibi Petitioners, and provided further that the Abitibi Petitioners shall, upon payment, be subrogated to the rights of the Abitibi Respondent Directors to recover payment from the applicable
insurer as if no such payment had been made. 
 
 
    53.               DECLARE that, as security for the obligation of the Bowater Petitioners to indemnify the Directors of the
Bowater Petitioners pursuant to paragraph 51hereof, the Directors of the Bowater Petitioners are hereby granted a hypothec on, mortgage of, lien on and security interest in the Property of the
Bowater Petitioners to the extent of the aggregate amount of $ 25 million (the "Bowater D&O Charge"), having the priority established by paragraphs 
 90 and  91 hereof. Such Bowater D&O Charge shall not constitute or form a trust. Such Bowater D&O
Charge, notwithstanding any language in any applicable policy of insurance to the contrary, shall only apply to the extent that the Directors of the Bowater Petitioners do not have coverage under any directors' and officers' insurance, which shall
not be excess insurance to the Bowater D&O Charge. In respect of any D&O Claim against any of the Directors of the Bowater Petitioners (collectively, the "Bowater Respondent Directors"), if such Bowater Respondent
Directors do not receive confirmation from the applicable insurer within 21 days of delivery of notice of the D&O Claim to the applicable insurer, confirming that the applicable insurer will provide coverage for and indemnify the Bowater
Respondent Directors, then, without prejudice to the subrogation rights hereinafter referred to, and subject to the terms of the BI DIP Documents (as defined hereinafter), the Bowater Petitioners shall pay the amount of the D&O Claim upon
expiry. Failing such payment, the Bowater Respondent Directors may enforce the Bowater D&O Charge provided that the Bowater Respondent Directors shall reimburse the Bowater Petitioners to the extent that they subsequently receive insurance
benefits for the D&O Claim paid by the Bowater Petitioners, and provided further that the Bowater Petitioners shall, upon payment, be subrogated to the rights of the Bowater Respondent Directors to recover payment from the applicable insurer as
if no such payment had been made. 
 
  
 
 
BCFPI DIP Financing 
    54.               ORDER  that the Bowater Petitioners are hereby authorized and empowered to enter
into, obtain and borrow under credit facilities provided pursuant to a Senior Secured Superpriority Debtor in Possession Credit Agreement among  Avenue Investments, L.P. ,  as a lender, Fairfax Financial Holdings Limited ("Fairfax"), as a lender, the other lenders party thereto from time to time (collectively, the "BI DIP Lenders" and , Fairfax
 as Administrative Agent and Collateral Agent (the Administrative Agent and the Collateral Agent, collectively, the "BI DIP Agent") substantially in the form communicated as
Exhibit R- 23 in support of the Petition (subject to such non-material amendments and modifications as the parties may agree with a copy thereof being provided in advance to the
Monitor) (the "BI DIP Credit Agreement"), provided that borrowings under such credit facility shall not exceed the principal amount of US$ 600  million unless
permitted by further Order of this Court, and the BI DIP Credit Agreement is hereby approved. 
 
    55.               ORDER  that the Bowater Petitioners are hereby
authorized and empowered to execute and deliver the BI DIP Credit Agreement and such commitment letters, fee letters, credit agreements, mortgages, charges, hypothecs and security documents, guarantees and other definitive documents (collectively,
with the BI DIP Credit Agreement, the "BI DIP Documents"), as are contemplated by the BI DIP Credit Agreement or as may be reasonably required by the BI DIP Lenders or the BI DIP Agent pursuant to the terms thereof, and the
Bowater Petitioners are hereby authorized and directed to pay and perform all of their indebtedness, interest, fees, liabilities and obligations to the BI DIP Lenders and the BI DIP Agent under and pursuant to the BI DIP Documents as and when the
same become due and are to be performed, notwithstanding any other provision of this Order.  
 
    56.               ORDER  that all of the Property of the Bowater Petitioners is hereby charged by a movable or immovable hypothec, mortgage, lien and security interest to the extent of the aggregate amount of US$ 600
million (such hypothec, mortgage, lien and security interest, together with any other hypothec, mortgage, lien or security interest created or contemplated by the DIP Documents, the "BI DIP
Lenders Charge") in favour of the BI DIP Agent, in its capacity as Collateral Agent, for and on behalf of the Secured Parties (as defined in the BI DIP Credit Agreement) (collectively, the "BI DIP Secured Parties")
as security for all obligations of the Bowater Petitioners to the BI DIP Secured Parties with respect to all amounts owing, including principal, interest and the BI DIP Lenders Expenses (as defined hereinafter) and all obligations required to be
performed under or in connection with the BI DIP Documents. The BI DIP Lenders Charge shall have the priority established by paragraphs 90 and 91  hereof. 
 
    57.               ORDER that, notwithstanding any other provision of this Order, the Bowater Petitioners
shall pay to the BI DIP Agent and the BI DIP Lenders when due all amounts owing (including principal, interest, fees and expenses, including without limitation, all fees and disbursements of counsel and
all other advisers to or agents of the BI DIP Agent and the BI DIP Lenders on a full indemnity basis (the "BI DIP Lenders Expenses")) under the BI DIP Documents and shall perform all of their other obligations to the BI DIP
Agent and to the BI DIP Lenders pursuant to the BI DIP Documents and this Order. 
 
 
    58.
              ORDER  that the claims of the BI DIP Agent and the BI DIP Lenders pursuant
to the BI DIP Documents shall not be compromised or arranged pursuant to the Plan or these proceedings and the BI DIP Agent and the BI DIP Lenders, in that capacity, shall be treated as unaffected creditors in these proceedings and in any Plan or
any proposal filed by a Bowater Petitioner under the BIA. 
 
    59.               ORDER  that the BI DIP Agent and the BI DIP Lenders may:  
 
   (a)                notwithstanding any other provision of this Order, take such steps from time to time as they may deem necessary or appropriate to register, record or perfect the BI DIP Lenders Charge and the BI DIP Documents in all jurisdictions where they
deem it is appropriate; and  (b)                notwithstanding the
terms of paragraphs 10 and 11 hereof, upon the occurrence of an Event of Default (as defined in the BI DIP Documents), refuse to make any advance to the Bowater Petitioners and
terminate, reduce or restrict any further commitment to the Bowater Petitioners to the extent any such commitment remains, set off or consolidate any amounts owing by the BI DIP Agent or by the BI DIP Lenders to the Bowater Petitioners against the
obligations of the Bowater Petitioners to the BI DIP Agent and the BI DIP Lenders under the BI DIP Documents or the BI DIP Lenders Charge, make demand, accelerate payment or give other similar notices, and the foregoing rights and remedies of the BI
DIP Lenders under this paragraph shall be enforceable against any trustee in bankruptcy, interim receiver, receiver or receiver and manager of the Bowater Petitioners or the Property of the Bowater Petitioners, the whole in accordance with and to
the extent provided in the BI DIP Documents.     60.              
ORDER  that the BI DIP Lenders shall not take any enforcement steps under the BI DIP Documents or the BI DIP Lenders Charge without providing a five (5) business days
(the "Notice Period") written enforcement notice of a default thereunder to the Bowater  Petitioners, the Monitor and to creditors requesting a copy of such notice. Upon expiry of such Notice Period, and notwithstanding any
stay of proceedings provided herein, the BI DIP Agent and the BI DIP Lenders shall be entitled to take any and all steps and exercise all rights and remedies provided for under the BI DIP Documents and the BI DIP Lenders Charge and otherwise
permitted at law, the whole in accordance with applicable provincial laws, but without having to send any notices under Section 244 of the BIA. 
 
    61.               ORDER that,
subject to further order of this Court, no order shall be made varying, rescinding, or otherwise affecting paragraphs  54 to 61 hereof, the approval of the BI DIP
Documents or the BI DIP Lenders Charge unless either (a) notice of a motion for such order is served on the Petitioners, the Monitor, the BI DIP Agent and the BI DIP Lenders by the moving party and returnable by no later than April 27 
, 2009; or (b) the BI DIP Agent and the BI DIP Lenders apply for or consent to such order. 
 
  Inter-Company Advances 
 
    62.               ORDER  that any Abitibi Petitioner is authorized to borrow, repay and reborrow
(such party being an "ACI Inter-Company Borrower") from any member of the ABH Group (such party being an "ACI Inter-Company Lender"), such amounts from time to time as it may consider necessary or desirable on a
revolving basis (the "ACI Inter-Company Advances") pursuant to a promissory note issued in favour of the ACI Inter-Company Lender as evidence thereof, to fund its ongoing expenditures and to pay such other amounts as are permitted
by the terms of this Order. 
 
    63.               ORDER  that all of the Property of an ACI Inter-Company Borrower (other than the
Property subject to the Securitization Program Agreements) is hereby charged by a lien, mortgage and security interest (the "ACI Inter-Company Advances Charge") in favour of the ACI Inter-Company Lender as security for the
obligations of the ACI Inter-Company Borrower to the ACI Inter-Company Lender with respect to the ACI Inter-Company Advances made to it. The ACI Inter-Company Advances Charge shall have the priority established by paragraphs 
89 and 91 hereof . 
 
    64.               ORDER  that the claims of the ACI Inter-Company Lender pursuant to the ACI Inter-Company Advances shall not be compromised or arranged pursuant to the Plan or these proceedings, but unless otherwise ordered, the
exercise of any remedies by the ACI Inter-Company Lender in respect thereof under the ACI Inter-Company Advances Charge shall be subject to the stay provided for in this Order. 
 

   65.               ORDER  that, subject to the terms of the BI DIP Documents, any Bowater Petitioner is authorized to borrow, repay and reborrow (such party being a "BI Inter-Company Borrower") from any member of the
ABH Group (such party being a "BI Inter-Company Lender"), such amounts from time to time as it may consider necessary or desirable on a revolving basis (the "BI Inter-Company Advances") pursuant to a promissory note
issued in favour of the BI Inter-Company Lender as evidence thereof, to fund its ongoing expenditures and to pay such other amounts as are permitted by the terms of this Order. 
 

   66.               ORDER  that all of the Property of an BI Inter-Company Borrower is hereby charged by a lien, mortgage and security interest the ("BI Inter-Company Advances Charge") in favour of the BI Inter-Company Lender as security for the
obligations of the BI Inter-Company Borrower to the BI Inter-Company Lender with respect to the BI Inter-Company Advances made to it. The BI Inter-Company Advances Charge shall have the priority established by paragraphs 90  and 91 . 
 
    67.               ORDER  that the claims of the BI
Inter-Company Lender pursuant to the BI Inter-Company Advances shall not be compromised or arranged pursuant to the Plan or these proceedings, but unless otherwise ordered, the exercise of any remedies by the BI Inter-Company Lender in respect
thereof under the BI Inter-Company Advances Charge shall be subject to the stay provided for in this Order. 
 
  Bowater Adequate Protection Charge 
    68.               ORDER that all of the Property of the Bowater Petitioners is hereby charged by a
lien, mortgage and security interest the ("Bowater Adequate Protection Charge") as security for the diminution in the value of the BI Bank Syndicate Security (as defined below), if any, subsequent to April 16, 2009 by sale, lease or
use of the BI Bank Syndicate Security.  The Bowater Adequate Protection Charge shall have the priority established by paragraphs 90 and 91 hereof . 
 
   
  69.               ORDER  that the obligations secured and the Property affected by the Bowater
Adequate Protection Charge shall be subject to approval of such charge in the US Proceedings and, in the event a lesser charge is approved or a lesser obligation is secured, the Bowater Adequate Protection Charge shall be reduced pro tanto.
The exercise of any remedies under the Bowater Adequate Protection Charge shall be subject to the stay provided for in this Order. 
 
  Powers of the Monitor 
    70.               ORDER  hat Ernst & Young Inc. is hereby appointed to monitor the
business and financial affairs of the Petitioners and Partnerships as an officer of this Court and that the Monitor shall, in addition to the duties and functions referred to in Section 11.7 of the CCAA: 
 
   (a)                give notice of this Order, within 10 days, to every known creditor of the Petitioners having a claim of more than $5,000.00 against it, advising that such creditor may obtain a copy of this Order on the internet at the website of the
Monitor (the "Website") or, failing that, from the Monitor and the Monitor shall, upon request,  so provide it. Such notice shall be deemed sufficient in accordance with Subsection 11(5) of the CCAA;  (b)                review and monitor the receipts and disbursements of the
Petitioners and Partnerships including without limitation the intercompany transactions referred to in paragraphs 28 and 62 to 67 of this Order;  (c)                 assist the Petitioners, to the extent required by the Petitioners and
Partnerships, in dealing with their creditors and other interested Persons during the Stay Period;  (d)                assist the Petitioners, to the extent required by the Petitioners and Partnerships, with the preparation of
their cash flow projections and any other projections or reports and the development, negotiation and implementation of the Plan;  (e)                 advise and assist the Petitioners, to the extent required by the Petitioners and Partnerships, to review
the Petitioners' and Partnerships' business and assess opportunities for cost reduction, revenue enhancement and operating efficiencies;  (f)                  assist the Petitioners, to the extent required by the Petitioners and Partnerships, with the
Restructuring and in their negotiations with their creditors and other interested Persons and with the holding and administering of any meetings held to consider the Plan;  
  
 (g)                report to the Court on the state of the business and
financial affairs of the Petitioners and Partnerships or developments in these proceedings or any related proceedings within the time limits set forth in the CCAA and at such time as considered appropriate by the Monitor or as the Court may order;
 (h)                report to this Court and interested parties,
including but not limited to creditors affected by the Plan, with respect to the Monitor's assessment of, and recommendations with respect to, the Plan;  (i)                  retain and employ such agents, advisers and other assistants as are reasonably necessary for the
purpose of carrying out the terms of this Order, including, without limitation, one or more entities related to or affiliated with the Monitor;  (j)                  engage legal counsel to the extent the Monitor considers necessary in connection with the exercise
of its powers or the discharge of its obligations in these proceedings and any related proceedings, under this Order or under the CCAA;  (k)                may act as a foreign representative of the Petitioners in any proceedings outside of Canada;  (l)                  may give any consents or approvals as are
contemplated by this Order; and  (m)              perform such other duties
as are required by this Order, the CCAA or this Court from time to time.   The Monitor shall not otherwise interfere with the business and
financial affairs carried on by the Petitioners and Partnerships, and the Monitor is not empowered to take possession of the Property nor to manage any of the business and financial affairs of the Petitioners and Partnerships. 
    71.               ORDER  that the Petitioners and their directors, officers, employees and agents, accountants, auditors and all other Persons having notice of this Order shall forthwith provide the Monitor with unrestricted access
to all of the Property, including, without limitation, the premises, books, records, data, including data in electronic form, and all other documents of the Petitioners and Partnerships in connection with the Monitor's duties and responsibilities
hereunder. 
 
    72.               DECLARE that the Monitor may provide creditors and other relevant stakeholders of the Petitioners with
information in response to requests made by them in writing addressed to the Monitor and copied to the Petitioners' counsel. The Monitor shall not have any duties or liabilities in respect of such information disseminated by it pursuant to the
provisions of this Order or the CCAA, other than as provided in paragraph 74hereof. In the case of information that the Monitor has been advised by the Petitioners, the BI DIP Agent or the BI DIP
Lenders is confidential, proprietary or competitive, the Monitor shall not provide such information to any Person without the consent of the Petitioners, the BI DIP Agent and the BI DIP Lenders unless otherwise directed by this Court. 

 
    73.              
DECLARE  that the Monitor shall not be, nor be deemed to be, an employer or a successor employer of the employees of the Petitioners and Partnerships or a related
employer in respect of the Petitioners and Partnerships within the meaning of any federal, provincial or municipal legislation governing employment, labour relations, pay equity, employment equity, human rights, health and safety or pensions or any
other statute, regulation or rule of law or equity for any similar purpose and, further, that the Monitor shall not be, nor be deemed to be, in occupation, possession, charge, management or control of the Property or business and financial affairs
of the Petitioners pursuant to any federal, provincial or municipal legislation, statute, regulation or rule of law or equity which imposes liability on the basis of such status, including, without limitation, the Environment Quality Act
(Québec), the Canadian Environmental Protection Act, 1999 or the Act Respecting Occupational Health and Safety (Québec) or similar other federal or provincial legislation. 
 
    74.           
    DECLARE  that, in addition to the rights and protections afforded to the Monitor by the CCAA, this Order or its status as an
officer of the Court, the Monitor shall not incur any liability or obligation as a result of its appointment and the fulfilment of its duties or the provisions of this Order, save and except any liability or obligation arising from the gross
negligence or willful misconduct, and no action or other proceedings shall be commenced against the Monitor relating to its appointment, its conduct as Monitor or the carrying out the provisions of any order of this Court, except with prior leave of
this Court, on at least seven days notice to the Monitor and its counsel. 
 
    75.               ORDER  that the Petitioners shall pay the fees and disbursements of the Monitor,
the Monitor's legal counsel, the Petitioners' legal counsel and other advisers, incurred in connection with or with respect to the Restructuring, whether incurred before or after this Order, and shall provide each with a reasonable retainer in
advance on account of such fees and disbursements, if so requested. 
 
    76.               DECLARES that the Monitor, the Monitor's legal counsel, the Abitibi Petitioners' legal counsel and other
advisers, as security for the professional fees and disbursements incurred both before and after the making of this Order by the Abitibi Petitioners in respect of these proceedings, the Plan and the Restructuring, in addition to the retainers
referred to paragraph  75 hereof, be entitled to the benefit of and are hereby granted a hypothec on, mortgage of, lien on, and security interest in the Property of the Abitibi Petitioners (other
than the Property subject to the Securitization Program Agreements) to the extent of the aggregate amount of $ 6 million (the "Abitibi Administration Charge"), having the
priority established by paragraphs 89 and 91 hereof. 
 

   77.               DECLARE  that the Monitor, the Monitor's legal counsel, the  Bowater Petitioners' legal counsel and other advisers, as security for the professional fees and
disbursements incurred both before and after the making of this Order by the Bowater Petitioners in respect of these proceedings, the Plan and the Restructuring, in addition to the retainers referred to paragraph 75 
hereof, be entitled to the benefit of and are hereby granted a hypothec on, mortgage of, lien on, and security interest in the Property of the Bowater Petitioners to the extent of the aggregate amount of
$ 2 million (the "Bowater Administration Charge"), having the priority established by paragraphs 90 and 91 hereof. 
 
  Appointment of Information Officer in Respect of U.S. Proceedings 
 
    78.               ORDERS  that, in respect of the U.S. Proceedings of the 18.6 Petitioners, Ernst
& Young Inc. is hereby appointed as an information officer with the powers and obligations set out herein (the "Information Officer"). 
 
    79.               ORDER  that the Information Officer shall report to this Court at such times and intervals as the Information Officer deems appropriate and, in any event, shall deliver a report to this Court at least once every
two months outlining the status of the U.S. Proceedings of the 18.6 Petititioners, and such other information as the Information Officer believes to be material with copies of such reports provided to the BI DIP Agent and the BI DIP Lenders and
report to the BI DIP Lenders on such additional issues related thereto upon the request of the BI DIP Agent and the BI DIP Lenders or their counsel. 
 
    80.               ORDER  that, in addition to the rights and protections afforded to the Information Officer as an officer of this Court, the Information Officer shall incur no liability or obligation as a result of its appointment
or the carrying out of the provisions of this Order, save and except from a failure to act in good faith and to take reasonable care. Nothing in this Order shall derogate from the protections afforded to the Information Officer by the CCAA or any
applicable legislation. 
 
    81.               ORDER  that the Information Officer shall provide any creditor of the 18.6
Petitioners located in Canada with information provided by the 18.6 Petitioners in response to reasonable requests for information made in writing by such creditor addressed to the Information Officer. The Information Officer shall not have any
responsibility or liability with respect to the information disseminated by it pursuant to this paragraph. In the case of information that the Information Officer has been advised by the 18.6 Petitioners is confidential, the Information Officer
shall not provide such information to creditors unless as otherwise directed by this Court or on such terms as the Information Officer and the 18.6 Petitioners may agree upon. 
 

   82.               ORDER  that the Information Officer shall not take possession of the Property and shall take no part whatsoever in the management or supervision of the management of the business of the 18.6 Petitioners and shall
not, by fulfilling its obligations hereunder, be deemed to have taken or maintained possession or control of the business or Property of the 18.6 Petitioners, or any part thereof.  For greater certainty, the Information Officer shall not employ
any employee of the 18.6 Petitioners; 
 
    83.               ORDER  that nothing herein contained shall require the Information Officer to
occupy or to take control, care, charge, possession or management of any of the Property of the 18.6 Petitioners that might be environmentally contaminated, might be a pollutant or a contaminant, or might cause or contribute to a spill, discharge,
release or deposit of a substance contrary to any federal, provincial or other law respecting the protection, conservation, enhancement, remediation or rehabilitation of the environment or relating to the disposal of waste or other contamination
including, without limitation, the Environment Quality Act (Quebec), the Canadian Environmental Protection Act, 1999 or similar other federal or provincial legislation and regulations under such legislation (the
"Environmental Legislation"), provided however that nothing herein shall exempt the Information Officer from any duty to report or make disclosure imposed by applicable Environmental Legislation. The Information Officer shall not,
as a result of this Order or anything done in pursuance of the Information Officer's duties and powers under this Order, be deemed to be in possession of any of the Property of the 18.6 Petitioners within the meaning of any Environmental
Legislation, unless it is actually in possession of such property. 
 
 
  
  Approval of Appointment of Financial Advisor 
  
  84.               AUTHORIZE  the appointment of
BMO Nesbitt Burns Inc. ("BMO Capital Markets") as financial advisor pursuant to the terms of the engagement letter dated March 31, 2009 (the "Engagement Letter") entered into by ACI. ACI is authorized to enter
into the Engagement Letter and to carry out and perform its rights and obligations thereunder (including payment of amounts due to be paid pursuant to the terms of the Engagement Letter) and the Engagement Letter shall be binding upon ACI.

 
    85.               ORDER  that, without limiting the provisions of this Order, the Abitibi
Petitioners shall pay, from time to time, certain fees to BMO Capital Markets, including a retention fee of $350,000.00 (the "Retention Fee"), a work fee of $200,000.00 per month until the termination of the Engagement Letter (the
"Work Fee"), a financing fee based on the commitment amount of any DIP financing (the "DIP Financing Fee") and the reimbursement of disbursements (and including any taxes on any of the foregoing) pursuant to the
Engagement Letter (collectively, the "BMO Obligations"). 
 
    86.               DECLARE  that BMO Capital Markets, as security for the BMO Obligations, shall be
entitled to and is hereby granted the benefit of the Administration Charge on a pari passu basis with all other beneficiaries of the Administration Charge. 
 
    87.               DECLARE
  that all claims of BMO Capital Markets pursuant to the Engagement Letter are not claims that may be compromised pursuant to any plan of compromise or arrangement under the CCAA or proposal under the BIA and no such plan
or proposal shall be approved that does not provide for the payment of the BMO Obligations pursuant to the terms of the Engagement Letter.  
 
    88.               ORDER  that notwithstanding: 
 
   (a)                the pendency of these proceedings;  (b)                any applications for a bankruptcy order now or hereafter issued pursuant to the BIA in respect of the Abitibi
Petitioners and any bankruptcy order issued pursuant to any such applications; and  (c)                
any assignment in bankruptcy made in respect of the Abitibi Petitioners;   
  the terms of the Engagement Letter and any payments made or actions taken pursuant thereto shall be binding on any trustee in bankruptcy that may be appointed in respect
of the applicable Abitibi Petitioners and shall not be void or voidable by creditors of the applicable Abitibi Petitioners, nor shall it constitute nor be deemed to be a settlement, fraudulent preference, assignment, fraudulent conveyance or
other reviewable transaction under the BIA or any other applicable federal or provincial legislation, nor shall it or they constitute oppressive or unfairly prejudicial conduct pursuant to any applicable federal or provincial legislation.

 
  
  Priorities and General Provisions Relating to
CCAA Charges 
    89.               DECLARE  that the priorities of the Abitibi Administration Charge, Abitibi D&O Charge, ACI Inter-Company Advances Charge and any charge granted by this Court to secure a DIP
financing of the Abitibi Petitioners (collectively, the "Abitibi CCAA Charges"), as between them with respect to any Property of the Abitibi Petitioners to which they apply, shall be as follows: 
 
   (a)                first, the Abitibi Administration Charge;  (b)                second, the Abitibi D&O Charge, up to a maximum of $ 22.5 million (the "Abitibi D&O First Tranche")  ; (c)                 third, any charge securing a DIP financing of the
Abitibi Petitioners authorized by further order of this Court ;  (d)                fourth, the ACI Inter-Company Advances Charge; and  (e)                
fifth, the Abitibi D&O Charge in respect of the balance of amounts, if any, secured thereby  (the "Abitibi D&O Second Tranche")  .    90.               DECLARE  that the priorities of the Bowater Administration Charge, Bowater D&O Charge, BI DIP Lenders Charge, Bowater Adequate Protection Charge and BI Inter-Company Advances
Charge (collectively, the "Bowater CCAA Charges"), as between them with respect to any Property of the Bowater Petitioners to which they apply, shall be as follows: 
 
   (a)                first, the Bowater Administration Charge;  (b)                second, the Bowater D&O Charge, up to a maximum of $ 7.5 million (the "Bowater D&O First Tranche")  ; (c)                 third, the BI DIP Lenders Charge;  (d)                fourth, the Bowater Adequate Protection Charge;  (e)                 fifth , the BI
Inter-Company Advances Charge; and  (f)                  sixth, the Bowater D&O Charge in respect of the balance of amounts, if any, secured thereby (the " Bowater D&O Second Tranche") .    91.               DECLARE
  that the Abitibi CCAA Charges and the Bowater CCAA Charges (collectively, the "CCAA Charges") shall rank in priority to any and all other hypothecs, mortgagees, liens, trusts, security, priorities,
conditional sale agreements, financial leases, charges, encumbrances or security of whatever nature or kind (collectively, "Encumbrances") affecting the Property of the Petitioners, other than: 
 
 
   (a)                in the case of the BI DIP Lenders Charge, the Bowater Adequate Protection Charge, the BI Inter-Company Advances Charge and the Bowater D&O Second Tranche, valid and perfected Encumbrances in respect of principal and interest, affecting
the Property of the Bowater Petitioners and currently held pursuant to the Credit Agreement dated as of May 31, 2006, as amended and restated (the "Canadian Credit Agreement") or supplemented, among BCFPI, as borrower, the lenders
named thereto and the Bank of Nova Scotia, as administrative agent (the "BI Bank Syndicate Security"), which BI Bank Syndicate Security shall rank in priority to the BI DIP Lenders Charge, the Bowater Adequate Protection
Charge, the BI Inter-Company Advances Charge and the Bowater D&O Second Tranche; and  (b)               
in the case of the ACI Inter-Company Advances Charge and the Abitibi D&O Second Tranche above:   (i)                  valid and perfected Encumbrances in respect of principal and interest
affecting the Property of the Abitibi Petitioners and currently held pursuant to the Credit and Guaranty Agreement dated as of April  1, 2008 among, inter alia, ACI, as borrower, Abitibi-Consolidated Company of Canada ("ACCC")
as guarantor, the Lenders party thereto and Goldman Sachs Credit Partners L.P. as administrative agent (the "ACI Bank Security"); and 
  (ii)                valid and perfected Encumbrances in respect of principal and interest, affecting
the Property of the Abitibi Petitioners and currently held pursuant to the US$413 million 13.75% Senior Secured Notes due April 1, 2011 (the "Senior Notes Security"); 
  which ACI Bank Security and Senior Notes Security shall rank in priority to the ACI Inter-Company Advances Charge and the Abitibi D&O Second Tranche.  

   92.               ORDER  that nothing in this Order shall affect any determination of (i) the validity or perfection of the BI Bank Syndicate Security, the ACI Bank Security or the Senior Notes Security, (ii) whether
such security is opposable to third parties, or (iii) whether such security is avoidable under applicable Canadian or United States laws. 
 
    93.               ORDER  that, except as otherwise expressly provided for herein, the Petitioners shall not grant any Encumbrances in or against any Property that rank in priority to, or pari passu with, any of the CCAA
Charges unless the Petitioners obtain the prior written consent of the Monitor and in the case of the Bowater Petitioners, the prior consent of the BI DIP Agent, the BI DIP Lenders and the prior approval of the Court. 
 
    94.              
DECLARES  that each of the CCAA Charges shall attach, as of the Effective Time of this Order, to all present and future Property of the Abitibi Petitioners (other than
the Property subject to the Securitization Program Agreements) or the Bowater Petitioners, as the case may be, notwithstanding any requirement for the consent of any party to any such charge or to comply with any condition precedent.

 
   
  95.               DECLARE  that the CCAA Charges and the rights and remedies of the beneficiaries
of such Charges, as applicable, shall be valid and enforceable and shall not otherwise be limited or impaired in any way by: (i) these proceedings and the declaration of insolvency made herein; (ii) any application for a bankruptcy order
filed pursuant to the BIA in respect of the Petitioners or any bankruptcy order made pursuant to any such petition or any assignment in bankruptcy made or deemed to be made in respect of the Petitioners; (iii) proceedings taken by any of the
Petitioners under Chapter 11 of Title 11 of The United States Code; or (iv) any negative covenants, prohibitions or other similar provisions with respect to borrowings, incurring debt or the creation of Encumbrances, contained in any
agreement, lease, sub-lease, offer to lease or other arrangement which binds the Petitioners (a "Third Party Agreement"), and notwithstanding any provision to the contrary in any Third Party Agreement: 
 
   (a)                the creation of any of the CCAA Charges shall not create or be deemed to constitute a breach, by the Petitioners, of any Third Party Agreement to which they are a party; and  (b)                any beneficiary of the CCAA Charges shall not be held liable against any Person whatsoever as a result of any
breach of any Third Party Agreement caused by or resulting from the creation of the CCAA Charges.    96.               DECLARE  that notwithstanding: (i) these proceedings and any declaration of
insolvency made herein, (ii) any petition for a bankruptcy order filed pursuant to the BIA in respect of the Petitioners and any bankruptcy order allowing such petition or any assignment in bankruptcy made or deemed to be made in respect of the
Petitioners; (iii) proceedings taken by any of the Petitioners under Chapter 11 of Title11 of The United States Code; or (iv) the provisions of any federal or provincial statute, the payments or disposition of Property made by the
Petitioners pursuant to the Order and the granting of the CCAA Charges, do not and will not constitute settlements, fraudulent preferences, fraudulent conveyances or other challengeable or reviewable transactions or conduct meriting an oppression
remedy under any applicable law. 
 
    97.               DECLARE  that the CCAA Charges shall be valid and enforceable as against all
Property of the Abitibi Petitioners (other than the Property subject to the Securitization Program Agreements) or of the Bowater Petitioners as the case may be and against all Persons, including, without limitation, any trustee in bankruptcy,
receiver, receiver and manager or interim receiver of the Petitioners, for all purposes and without any filing registration, publication, recording or perfecting of the CCAA Charges. 
 
  
  General

    98.               DECLARE  that this Order and any proceeding or affidavit leading to the Order, shall not, in and of themselves, constitute a default or failure to comply, by the Petitioners, under
any statute, regulation, license, permit, contract, permission, covenant, agreement, undertaking or other written document or requirement. 
 
 
  99.               DECLARE
  that, except as otherwise specified herein, the Petitioners are at liberty to serve any notice, proof of claim form, proxy, circular or other document in connection with these proceedings by forwarding copies by prepaid
ordinary mail, courier, personal delivery or electronic transmission to Persons or other appropriate parties at their respective given addresses as last shown on the records of the Petitioners and that any such service shall be deemed to be received
on the date of delivery (if by personal delivery or electronic transmission), on the following business day (if delivered by courier), or three business days after mailing (if by ordinary mail). 
 
    100.           DECLARE  that the Petitioners may serve any Court materials in these proceedings on all represented parties electronically, by emailing a PDF or other electronic copy of such
materials to counsels' email addresses, provided that the Petitioners shall deliver "hard copies" of such materials upon request to any party as soon as practicable thereafter. 
 
    101.           DECLARE  that any party in these proceedings, other than the Petitioners, may serve any Court materials electronically, by emailing a PDF or other electronic copy of all materials to
counsels' email addresses, provided that such party shall deliver both PDF or other electronic copies and "hard copies" of all materials to counsel to the Petitioners and the Monitor and to any other party requesting same.

 
    102.           DECLARE  that, unless otherwise provided herein or ordered by this Court, no document, order or other material need be served on any Person in respect of these proceedings, unless
such Person has served a Notice of Appearance on the solicitors for the Petitioners and the Monitor and has filed such notice with this Court. 
 
    103.           DECLARE  that the Petitioners or the Monitor may, from time to time, apply to this Court for directions concerning the exercise of their respective powers, duties and rights hereunder or in respect of the proper execution of this Order on notice
only to each other. 
 
    104.           DECLARE  that any interested Person may apply to this Court to vary or rescind this Order or seek other
relief upon seven days notice to the Petitioners, the Monitor, the BI DIP Agent, the BI DIP Lenders and to any other party likely to be affected by the order sought or upon such other notice, if any, as this Court may order. 
 
  
  Effect,
Recognition and Assistance 
    105.           DECLARE  that this Order and all other orders in these proceedings shall have full force and effect in all provinces and territories in Canada.  
 
    106.           REQUEST  the aid and recognition of any Court or administrative body in any Province of Canada and any Canadian Federal Court or administrative body and any federal or State Court or
administrative body in the United States of America including, without limitation, the U.S. Bankruptcy Court, and other nations and states to give effect to this Order and to assist the Petitioners, the Monitor and their respective agents in
carrying out the terms of this Order and any other Order in these proceedings . All Courts or administrative bodies are hereby respectfully requested to make such orders and to provide such assistance to the Petitioners and to the Monitor, as an
officer of this Court, as may be necessary or desirable to give effect to this Order, to grant representative status to ACI and/or the Monitor in any foreign proceedings and to assist the Petitioners and the Monitor and their respective agents in
carrying out the terms of this Order and any other Order in these proceedings , including, without limitation, recognizing the Petitioners' CCAA proceedings as a foreign main proceeding under applicable law. 

 
  107.           DECLARE  that each of the Petitioners and the Monitor be at liberty and is hereby authorized and empowered to apply to any court, tribunal, regulatory or administrative body,
wherever located, for the recognition of this Order and any other Order granted by this Court including, without limitation, applications under Chapter 15 of the U.S. Bankruptcy Code in respect of ACI and ACCC, and to recognize or give effect to or
otherwise further the Restructuring. 
 
    108.           DECLARE  that for the purposes of seeking the aid and recognition of any court or any judicial,
regulatory or administrative body outside of Canada and in particular in the U.S. Bankruptcy Court in respect of proceedings commenced under Chapter 15 of the U.S. Bankruptcy Code and any ancillary relief in respect thereto, ACI shall be
appointed as and is hereby authorized and directed to act as the foreign representative of the Petitioners and to seek such aid and recognition. 
 
    109.           DECLARE  that for the purposes of seeking the aid and recognition of any court or any judicial, regulatory or administrative body outside of Canada, the Petitioners' centre of main interest (COMI) is ACI's principal executive offices situated at
1155 Metcalfe Street, in the city and district of Montréal, Province of Québec. 
 
    110.           ORDER  the provisional execution of this Order notwithstanding any appeal and
without the necessity of furnishing any security. 
 
  
  THE WHOLE WITHOUT COSTS , save and except in case of contestation. 
   
    
  Montréal, April  17 , 2009
 
 

______________________________
 Stikeman Elliott LLP
 Attorneys for the Petitioners 
   
  
   

 SCHEDULE "A" 
  ABITIBI PETITIONERS  
    

	  1.                     
	  Abitibi-Consolidated Inc.
 

	  2.                     
	  Abitibi-Consolidated Company of
Canada  

	  3.                     
	  3224112 Nova Scotia Limited
 

	  4.                     
	  Marketing Donohue Inc. 

	  5.                     
	  Abitibi-Consolidated Canadian
Office Products Holdings Inc.  

	  6.                     
	  3834328 Canada Inc. 

	  7.                     
	  6169678 Canada Inc. 

	  8.                     
	  4042140 Canada Inc. 

	  9.                     
	  Donohue Recycling Inc. 

	  10.               
  
	  1508756 Ontario Inc. 

	  11.               
  
	  3217925 Nova Scotia Company
 

	  12.               
  
	  La Tuque Forest Products Inc.
 

	  13.               
   
	  Abitibi-Consolidated Nova Scotia
Incorporated  

	  14.               
  
	  Saguenay Forest Products Inc.
 

	  15.               
  
	  Terra Nova Explorations Ltd.
 

	  16.               
  
	  The Jonquière Pulp Company
 

	  17.               
  
	  The International Bridge and
Terminal Company  

	  18.               
  
	  Scramble Mining Ltd. 

	  19.               
  
	  9150-3383 Québec Inc.
 

    
 
  
   
  SCHEDULE "B"  
  BOWATER PETITIONERS  
    

	  1.                     
	  Bowater Canadian Holdings Inc.
 

	  2.                     
	  Bowater Canada Finance
Corporation  

	  3.                     
	  Bowater Canadian Limited 

	  4.                     
	  3231378 Nova Scotia Company
 

	  5.                     
	  AbitibiBowater Canada Inc.
 

	  6.                     
	  Bowater Canada Treasury
Corporation  

	  7.                     
	  Bowater Canadian Forest Products
Inc.  

	  8.                     
	  Bowater Shelburne Corporation
 

	  9.                     
	  Bowater LaHave Corporation
 

	  10.                  
	  St-Maurice River Drive Company
Limited  

	  11.                  
	  Bowater Treated Wood Inc.
 

	  12.                  
	  Canexel Hardboard Inc. 

	  13.                  
	  9068-9050 Québec Inc.
 

	  14.                  
	  Alliance Forest Products (2001)
Inc.  

	  15.                  
	  Bowater Belledune Sawmill Inc.
 

	  16.                  
	  Bowater Maritimes Inc. 

	  17.                  
	  Bowater Mitis Inc.  

	  18.                  
	  Bowater Guérette Inc.
 

	  19.                  
	  Bowater Couturier Inc. 

    
 
  
   
  SCHEDULE "C"  
  18.6 CCAA Petitioners  
    

	  1.                     
	  AbitibiBowater Inc. 

	  2.                     
	  AbitibiBowater US Holding 1
Corp.  

	  3.                     
	  Bowater Ventures Inc. 

	  4.                     
	  Bowater Incorporated 

	  5.                     
	  Bowater Nuway Inc.  

	  6.                     
	  Bowater Nuway Mid-States Inc.
 

	  7.                     
	  Catawba Property Holdings LLC
 

	  8.                     
	  Bowater Finance Company Inc.
 

	  9.                     
	  Bowater South American Holdings
Incorporated  

	  10.                  
	  Bowater America Inc. 

	  11.                  
	  Lake Superior Forest Products
Inc.  

	  12.                  
	  Bowater Newsprint South LLC
 

	  13.                  
	  Bowater Newsprint South
Operations LLC  

	  14.                  
	  Bowater Finance II, LLC 

	  15.                  
	  Bowater Alabama LLC 

	  16.                  
	  Coosa Pines Golf Club Holdings
LLC  

    
 
  
   
  SCHEDULE "D"  
  PARTNERSHIPS 
    

	  1.                     
	  Bowater Canada Finance Limited
Partnership  

	  2.                     
	  Bowater Pulp and Paper Canada
Holdings Limited Partnership  

	  3.                     
	  Abitibi-Consolidated Finance LP
 

  
   
 
  
  SCHEDULE "E"  
  U.S. DEBTORS 
    

	  17.                  
	  AbitibiBowater Inc. 

	  18.                  
	  AbitibiBowater US Holding LLC
 

	  19.                  
	  Donohue Corp.  

	  20.                  
	  Abitibi Consolidated Sales
Corporation  

	  21.                  
	  Abitibi-Consolidated Alabama
Corporation  

	  22.                  
	  Alabama River Newsprint Company
 

	  23.                  
	  Abitibi-Consolidated Corporation
 

	  24.                  
	  Augusta Woodlands, LLC 

	  25.                  
	  Tenex Data Inc.  

	  26.                  
	  AbitibiBowater US Holding 1
Corp.  

	  27.                  
	  Bowater Ventures Inc. 

	  28.                  
	  Bowater Incorporated 

	  29.                  
	  Bowater Nuway Inc.  

	  30.                  
	  Bowater Nuway Mid-States Inc.
 

	  31.                  
	  Catawba Property Holdings LLC
 

	  32.                  
	  Bowater Finance Company Inc.
 

	  33.                  
	  Bowater South American Holdings
Incorporated  

	  34.                  
	  Bowater America Inc. 

	  35.                  
	  Lake Superior Forest Products
Inc.  

	  36.                  
	  Bowater Newsprint South LLC
 

	  37.                  
	  Bowater Newsprint South
Operations LLC  

     
   

   

	  38.                   
	   Bowater Finance II, LLC 

	  39.                   
	   Bowater Alabama LLC 

	  40.                   
	   Coosa Pines Golf Club Holdings
LLC  

	  41.                   
	   Bowater Canadian Forest
Products Inc.  

	  42.                   
	   Bowater Canada Finance
Corporation  

	  43.                   
	   Bowater Canadian Holdings
Incorporated  

	  44.                   
	   Bowater Canadian Limited
 

	  45.                   
	   AbitibiBowater Canada Inc.
 

	  46.                   
	   Bowater LaHave
Corporation   

	  47.                   
	  Bowater Maritimes Inc. 

  
 
  
  
  
   AFFIDAVIT 
  
  
  I, the undersigned,  William Harvey , having my principal place
of business at  Suite 800, 1155 René Lévesque Blvd. West, Montréal, Quebec, H3B 3H5  solemnly declare the following: 
   
   1.         I
am the Senior Vice President and Chief Financial Officer of AbitibiBowater Inc. and Abitibi-Consolidated Inc.; 
   
   2.         All the facts alleged in the Petition for an Initial
Order pursuant to sections 4, 5 and 11 of the Companies' Creditors Arrangement Act (the "CCAA") and Petition for the Issuance of a Recognition Order pursuant to Section 18.6 of the CCAA are true. 
     
   AND I HAVE SIGNED
 
 
 
  
                                         
                   
 William Harvey  
      
   Solemnly declared before me at Wilmington, Delaware,
 on the  17th  day of April, 2009
 
 
 

                                         
                              
 Notary Public  
     
   
     
 

    EXHIBIT E  
  
   
  FORM OF  
  GUARANTY SUPPLEMENT  
      
  _________ __, 200_  
  Fairfax Financial Holdings Ltd., as Administrative Agent
 [Address]  
     
  Attention:  _________  
   Re   :  Senior Secured Superpriority Debtor-In-Possession Credit Agreement dated as of April 21, 2009 among
 AbitibiBowater Inc., a Delaware corporation, Bowater Incorporated, a Delaware corporation, Bowater Canadian Forest Products
Inc., a Nova Scotia company, each a debtor and debtor-in-possession under Chapter 11 of the Bankruptcy Code (collectively, the "Borrowers"),  
  the Guarantors party thereto, each a debtor and debtor-in-possession under Chapter 11 of the Bankruptcy Code, Fairfax Financial Holdings Ltd., as Administrative Agent and
Collateral Agent,
 and the Lenders party thereto  
  
  Ladies and Gentlemen:  
  
  Reference is made to the above-captioned Senior
Secured Superpriority Debtor-in-Possession Credit Agreement (as amended, restated, supplemented or otherwise modified from time to time, the "Credit Agreement").  The capitalized terms defined in the Credit Agreement and not
otherwise defined herein are used herein as therein defined.  
  
                           Section 1.  Guaranty; Limitation of Liability  (a)  The
undersigned hereby irrevocably guarantees the punctual payment when due, whether at scheduled maturity or at a date fixed for prepayment or by acceleration, demand or otherwise, of all of the Obligations of each of the Borrowers now or hereafter
existing under or in respect of the Loan Documents (including, without limitation, any extensions, modifications, substitutions, amendments or renewals of any or all of the foregoing Obligations), whether direct or indirect, absolute or contingent,
and whether for principal, interest, premium, fees, indemnification payments, contract causes of action, costs, expenses or otherwise (such Obligations being the " Guaranteed Obligations "), and agrees to pay any and all expenses (including, without
limitation, reasonable and actual fees and expenses of counsel) incurred by the Administrative Agent or any of the other Secured Parties solely in enforcing any rights under this Guaranty Supplement or any other Loan Document.  Without limiting
the generality of the foregoing, the undersigned's liability shall extend to all amounts that constitute part of the Guaranteed Obligations and would be owed by any of the Borrowers to the Administrative Agent or any of the other Secured Parties
under or in respect of the Loan Documents but for the fact that they are unenforceable or not allowable due to the existence of a bankruptcy, reorganization or similar proceeding involving such other Credit Party.  
  
                          (b)        The undersigned, and by its acceptance of this Guaranty
Supplement, the Administrative Agent and each other Secured Party, hereby confirms that it is the intention of all such Persons that this Guaranty Supplement and the Obligations of the undersigned hereunder and thereunder not constitute a fraudulent
transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to the extent applicable to this Guaranty Supplement and the Obligations
of the undersigned hereunder and thereunder.  To effectuate the foregoing intention, the Administrative Agent, the other Secured Parties and the undersigned hereby irrevocably agree, by their acceptance of this Guaranty Supplement, that the
Obligations of the undersigned under this Guaranty Supplement at any time shall be limited to the maximum amount as will result in the Obligations of the undersigned under this Guaranty Supplement not constituting a fraudulent transfer or
conveyance.  
  
 
  
  
                          (c)        The undersigned hereby unconditionally and irrevocably
agrees that in the event any payment shall be required to be made to any Lender under this Guaranty Supplement or any other guaranty, the undersigned will contribute, to the maximum extent permitted by applicable law, such amounts to each other
Guarantor and each other guarantor so as to maximize the aggregate amount paid to the Agents and the Lenders under or in respect of the Loan Documents.  
  
                           Section 2.  Obligations Under the  Guaranty Supplement. The
undersigned hereby agrees, as of the date first above written, to be bound as a Guarantor by all of the terms and conditions of the Guaranty Supplement and the Credit Agreement to the same extent as each of the other Guarantors under the Credit
Agreement.  The undersigned further agrees, as of the date first above written, that each reference in the Guaranty Supplement to an "Additional Guarantor" or a "Guarantor" shall also mean and be a reference to the
undersigned, and each reference in any other Loan Document to a "Subsidiary Guarantor" or a "Credit Party" shall also mean and be a reference to the undersigned.  
  
                           Section 3.  Representations and Warranties  . The undersigned
hereby makes each representation and warranty set forth in Section 4 of the Credit Agreement, as of the date hereof, to the same extent as each other Guarantor.  
  
                           Section 4.  Delivery by Telecopier  . Delivery of an executed
counterpart of a signature page to this Guaranty Supplement by telecopier shall be effective as delivery of an original executed counterpart of this Guaranty Supplement.  
  
                           Section 5.  Governing Law; Jurisdiction; Waiver of Jury Trial, Etc.
 (a)  This Guaranty Supplement shall be governed by, and construed in accordance with, the laws of the State of New York and, to the extent applicable, the Bankruptcy Code.  
  
   (b)              
The undersigned hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate
court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any of the other Loan Documents to which it is a party, or for recognition or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in any such New York State court or, to the extent permitted by law, in such federal court.  The undersigned hereby
agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Agreement shall affect any right that
any party may otherwise have to bring any action or proceeding relating to this Agreement or any of the other Loan Documents in the courts of any jurisdiction.  
  
   (c)              
The undersigned hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement or any of the other Loan Documents to which it is a party in any New York State or federal court.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such court.  
 
  
   (d)               The undersigned hereby irrevocably waives all right to trial by jury in any action,
proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to any of the Loan Documents, the Advances or the actions of the Administrative Agent or any Lender in the negotiation, administration, performance
or enforcement thereof.  
     
     
  [Remainder of page intentionally left blank]  

  
    
      
  
                                         
                                         
                                         
           Very truly yours,  
     
     
                                          
                                         
                                         
           [NAME OF ADDITIONAL GUARANTOR,  
                                          
                                         
                                         
           a debtor and debtor-in-possession]  
     
   
   
                                          
                                         
                                         
          By _____________________________  
                                          
                                         
                                         
                Name:

                                         
                                         
                                         
               Title:  

  
    
    EXHIBIT F   
  FORM OF NOTE  
  
$__________                                       
                                         
               
  Dated:  __________, 200_  
  
                          FOR VALUE RECEIVED, the undersigned, ___________, a ________ [corporation][limited liability company]
and a debtor and debtor-in-possession under Chapter 11 of the Bankruptcy Code (the "Borrower"), HEREBY PROMISES TO PAY __________ or its registered assigns (the "Lender") for the account of its Lending Office (as defined
in the Credit Agreement referred to below) the outstanding principal amount of the [Term][Incremental Facility] Advance (as defined below) owing to the Lender by the Borrower pursuant to the Senior Secured Superpriority Debtor-In-Possession Credit
Agreement dated as of April 21, 2009 (as amended, amended and restated, supplemented or otherwise modified from time to time, the "Credit Agreement"; terms defined therein, unless otherwise defined herein, being used herein as therein
defined) among the Borrower, the other Borrowers identified therein and the Guarantors party thereto, each a debtor and debtor-in-possession under Chapter 11 of the Bankruptcy Code, Fairfax Financial Holdings Ltd., as Administrative Agent,
Collateral Agent and Initial Lender, Avenue Investments, L.P. as Initial Lender and certain other lenders from time to time party thereto in the amounts specified in the Credit Agreement.  
  
                          The Borrower promises to pay interest on the unpaid principal amount of the [Term
Advance][Incremental Facility] from the date of such [Term Advance][Incremental Facility] until such principal amount is paid in full, at such interest rates, and payable at such times, as are specified in the Credit Agreement.  
  
                          Both principal and interest are payable in lawful money of the United States of America to Fairfax
Financial Ltd., as Administrative Agent, at 85 Wellington Street West Suite 800,Toronto, Ontario M5J 2N7, Canada, in same day funds.  The [Term Advance][Incremental Facility] owing to the Lender by the Borrower, and all payments made on account
of principal thereof, shall be recorded by the Lender and, prior to any transfer hereof, endorsed on the grid attached hereto, which is part of this [Term][Incremental Facility] Note; provided, however, that the failure of the Lender
to make any such recordation or endorsement shall not affect the Obligations of the Borrower under this [Term][Incremental Facility] Note.  
  
                          This [Term][Incremental Facility] Note is one of the
Notes referred to in, and is entitled to the benefits of, the Credit Agreement.  The Credit Agreement, among other things, (i) provides for the making of a single advance (the "Term Advance") by the Lender to the Borrower in an
amount not to exceed the U.S. dollar amount first above mentioned, [the indebtedness of the Borrower resulting from such Term Advance being evidenced by this Term Note], (ii) provides for the making of advances under the Incremental Facility (the
"Incremental Facility Advance"), [the indebtedness of the Borrower resulting from such Incremental Facility Advance being evidenced by this Incremental Facility Note], and (iii) contains provisions for acceleration of the maturity
hereof upon the happening of certain stated events and also for prepayments on account of principal hereof prior to the maturity hereof upon the terms and conditions therein specified.  The obligations of the Borrower under this
[Term][Incremental Facility] Note and the other Loan Documents, and the obligations of the other Credit Parties under the Loan Documents, are secured by the Collateral as provided in the Loan Documents.  

  
   
    
                           This
[Term][Incremental Facility] Note shall be governed by, and construed in accordance with, the laws of the State of New York and, to the extent applicable, the Bankruptcy Code.  
     
  [ABITIBIBOWATER INC.]  
  [BOWATER INCORPORATED]
  [BOWATER CANADIAN FOREST PRODUCTS INC.] ,  
  a debtor and debtor-in-possession  
     
   
   
                                          
                                         
                               By   ______________________________

                                         
                                         
                                      Name:

                                         
                                         
                                      Title:  
     

 
  
      PAYMENTS OF PRINCIPAL  
  

	   Date  
	
   Amount of
 Principal Paid
 or Prepaid  
	
   Unpaid
 Principal
 Balance  
	
   Notation
 Made By

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