Document:

Exhibit 10.1.2

Exhibit 10.1.2

 

CATALYST PAPER CORPORATION

and

WELLS FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE

 

SECOND SUPPLEMENTAL INDENTURE 

Dated as of July 14, 2006

to

INDENTURE

Dated as of May 15, 2003

by and among

CATALYST PAPER CORPORATION, as Issuer

The GUARANTORS named therein

and

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

 

8 5/8% Senior Notes Due 2011

 

 

 

 

	 	 	 	 	 
	ARTICLE I

	REAFFIRMATION OF OBLIGATIONS OF THE GUARANTORS

	 
	 	 	 	 
	Section 1.01. Reaffirmation
	 	 	2	 
	 
	 	 	 	 
	ARTICLE II

	GUARANTEE OF NOTES

	 
	 	 	 	 
	Section 2.01. Guarantee
	 	 	2	 
	Section 2.02. Execution and Delivery of Guarantee
	 	 	3	 
	Section 2.03. Limitation of Guarantee
	 	 	4	 
	Section 2.04. Release of Guarantor
	 	 	4	 
	Section 2.05. Assumption of Terms of the Indenture
	 	 	5	 
	 
	 	 	 	 
	ARTICLE III

	MISCELLANEOUS PROVISIONS

	 
	 	 	 	 
	Section 3.01. Terms Defined
	 	 	5	 
	Section 3.02. Indenture
	 	 	5	 
	Section 3.03. Governing Law
	 	 	5	 
	Section 3.04. Successors
	 	 	5	 
	Section 3.05. Multiple Counterparts
	 	 	5	 
	Section 3.06. Effectiveness
	 	 	5	 
	Section 3.07. Trustee Disclaimer
	 	 	5	 
	Section 3.08. Agent for Service; Submission to Jurisdiction; Waiver of Immunities
	 	 	6	 

 

i

 

SECOND SUPPLEMENTAL INDENTURE dated as of July 14, 2006, by and among CATALYST PAPER
CORPORATION, formerly named NORSKE SKOG CANADA LIMITED, a Canadian corporation (the “COMPANY”),
0606890 B.C. LTD., a British Columbia corporation (the “NEW GUARANTOR”), the guarantors set forth
on the signature pages hereto (the “EXISTING GUARANTORS”, and together with the New Guarantor, the
“GUARANTORS”), and WELLS FARGO BANK, NATIONAL ASSOCIATION as trustee under the hereafter defined
Indenture (the “TRUSTEE”).

WHEREAS, the Company and the Existing Guarantors previously executed and delivered to the
Trustee an indenture dated as of May 15, 2003, as supplemented and amended by the First
Supplemental Indenture, dated as of December 1, 2003, by and between the Company, the guarantors
named therein and the Trustee (collectively, the “Indenture”), providing for the issuance of an
unlimited principal amount of the Company’s 8 5/8% Senior Notes Due 2011 (the “Notes”); and

WHEREAS, there have been issued and are now outstanding under the Indenture, Notes in the
aggregate principal amount of $400,000,000; and

WHEREAS, the Company is the holder of all of the issued and outstanding shares of the New
Guarantor; and

WHEREAS, the Indenture provides that under certain circumstances the New Guarantor shall
execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor
shall unconditionally guarantee all of the Company’s obligations under the Notes and the Indenture
on the terms and conditions set forth herein (the “Guarantee”); and

WHEREAS, the New Guarantor desires, by this Second Supplemental Indenture (the “Second
Supplemental Indenture”), to unconditionally guarantee all of the Company’s obligations under the
Notes and the Indenture on the terms set forth herein; and

WHEREAS, the Existing Guarantors desire, by this Second Supplemental Indenture, to expressly
reaffirm, jointly and severally, the obligations of the Existing Guarantors under the Indenture and
under Guarantees endorsed on the Notes; and

WHEREAS, all the conditions and requirements necessary to make this Second Supplemental
Indenture a valid, binding and legal instrument in accordance with its terms have been performed
and fulfilled by the parties hereto and the execution and delivery thereof have been in all
respects duly authorized by the parties hereto.

 

 

 

NOW, THEREFORE, in consideration of the above premises, each party agrees, for the benefit of
the others and for the equal and ratable benefit of the Holders of the Notes, as follows:

ARTICLE I

REAFFIRMATION OF OBLIGATIONS OF THE GUARANTORS

Section 1.01. Reaffirmation. Each Existing Guarantor hereby expressly and unconditionally
reaffirms each and every covenant, agreement and undertaking of such Existing Guarantor in the
Indenture, and also hereby expressly and unconditionally reaffirms each and every covenant,
agreement and undertaking in its Guarantee endorsed on the Notes outstanding on the date of this
Second Supplemental Indenture and in each Guarantee endorsed on any Notes delivered hereafter.

ARTICLE II

GUARANTEE OF NOTES

Section 2.01. Guarantee.

The New Guarantor hereby jointly and severally unconditionally guarantees, on a senior
unsecured basis, to each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee and its successors, irrespective of: (i) the validity and enforceability of the Indenture,
the Notes or the obligations of the Company or any other Guarantors to the Holders or the Trustee
hereunder or thereunder; or (ii) the absence of any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or default of a
Guarantor, that: (a) the principal of, premium, if any, interest on the Notes will be duly and
punctually paid in full when due, whether at maturity, by acceleration or otherwise, and interest
on the overdue principal of, and premium if any, and (to the extent permitted by law) interest and
all other obligations of the Company or any Guarantor to the Holders or the Trustee hereunder or
thereunder (including amounts due the Trustee under Section 7.07 of the Indenture) and all other
obligations under the Indenture or the Notes will be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment
or renewal of any Notes or any of such other obligations, the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed, or
failing performance of any other obligation of the Company to the Holders, for whatever reason, the
New Guarantor will be obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Notes shall constitute an event of
default under this Guarantee, and shall entitle the Holders of Notes or the Trustee to accelerate
the obligations of the Guarantor hereunder in the same manner and to the same extent as the
obligations of the Company.

 

2

 

The New Guarantor, by execution of this Guarantee, agrees that its obligations hereunder shall
be unconditional, irrespective of the validity, regularity or enforceability of the Indenture or
the Notes, the absence of any action to enforce the same, any waiver or consent by any Holder with
respect to any provisions hereof or thereof, any release of any other Guarantor, the recovery of
any judgment against the Company, any action to enforce the same, whether or not a Guarantee is
affixed to any particular Note, or any other circumstance which might otherwise constitute a legal
or equitable discharge or defense of a Guarantor. The New Guarantor, by execution of this
Guarantee, waives the benefit of diligence, presentment, demand of payment, filing of claims with a
court in the event of insolvency or bankruptcy of the Company, any right

to require a proceeding first against the Company, protest, notice and all demands whatsoever
and covenants that the Guarantee shall not be discharged except by complete performance of the
obligations contained in the Notes, the Indenture and this Guarantee. This Guarantee is a
guarantee of payment and not of collection. If any Holder or the Trustee is required by any court
or otherwise to return to the Company or to any Guarantor, or any custodian, trustee, liquidator or
other similar official acting in relation to the Company or such Guarantor, any amount paid by the
Company or such Guarantor to the Trustee or such Holder, this Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect. The New Guarantor further agrees that,
as between it, on the one hand, and the Holders and the Trustee, on the other hand, (a) subject to
Article Ten of the Indenture, the maturity of the obligations guaranteed hereby may be accelerated
as provided in Article Six of the Indenture for the purposes of this Guarantee, notwithstanding any
stay, injunction or other prohibition preventing such acceleration in respect of the obligations
guaranteed hereby, and (b) in the event of any acceleration of such obligations as provided in
Article Six of the Indenture, such obligations (whether or not due and payable) shall forthwith
become due and payable by the New Guarantor for the purpose of this Guarantee.

This Guarantee shall remain in full force and effect and continue to be effective should any
petition be filed by or against the Company for liquidation or reorganization, should the Company
become insolvent or make an assignment for the benefit of creditors or should a receiver or trustee
be appointed for all or any significant part of the Company’s assets, and shall, to the fullest
extent permitted by law, continue to be effective or be reinstated, as the case may be, if at any
time payment and performance of the Notes are, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee on the Notes, whether as a
“voidable preference,” “fraudulent transfer” or otherwise, all as though such payment or
performance had not been made. In the event that any payment, or any part thereof, is rescinded,
reduced, restored or returned, the Notes shall, to the fullest extent permitted by law, be
reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or
returned.

No shareholder, officer, director, employee or incorporator, past, present or future, of the
New Guarantor, as such, shall have any personal liability under this Guarantee by reason of his,
her or its status as such shareholder, officer, director, employee or incorporator.

Section 2.02. Execution and Delivery Of Guarantee.

To further evidence the Guarantee set forth in Section 2.01 hereof, the New Guarantor hereby
agrees that a notation of such Guarantee, substantially in the form included in Exhibit F of the
Indenture, shall be endorsed on each Note authenticated and delivered by the Trustee after Article
10 of the Indenture with respect to such New Guarantor becomes effective in accordance with Section
4.13 of the Indenture and such Guarantee shall be executed by either manual or facsimile signature
of an Officer of the New Guarantor. The validity and enforceability of the Guarantee shall not be
affected by the fact that it is not affixed to any particular Note.

The New Guarantor hereby agrees that its Guarantee set forth in Section 2.01 hereof shall
remain in full force and effect notwithstanding any failure to endorse on each Note a notation of
such Guarantee.

 

3

 

If an Officer of the New Guarantor whose signature is on the Indenture or a Guarantee no
longer holds that office at the time the Trustee authenticates the Note on which such Guarantee is
endorsed or at any time thereafter, the New Guarantor’s Guarantee of such Note shall be valid
nevertheless.

The delivery of any Note by the Trustee, after the authentication thereof under the Indenture,
shall constitute due delivery of the Guarantee set forth in the Indenture on behalf of the New
Guarantor.

Section 2.03. Limitation of Guarantee.

The obligations of each Guarantor are limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Guarantor and after giving effect to
any collections from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to its contribution obligations
under the Indenture, result in the obligations of such Guarantor under the Guarantee not
constituting a fraudulent conveyance or fraudulent transfer under federal or state law. Each
Guarantor that makes a payment or distribution under a Guarantee shall be entitled to a
contribution from each other Guarantor in a PRO RATA amount based on the net assets of each
Guarantor, determined in accordance with GAAP.

Section 2.04. Release of Guarantor.

A Guarantor shall be released from all of its obligations under its Guarantee if:

(i) the Guarantor has sold all of its assets or the Company and its Restricted Subsidiaries
have sold all of the Capital Stock of the Guarantor owned by them, in each case in a transaction in
compliance with the terms of the Indenture (including Sections 4.10 and 5.01 thereof);

(ii) the Guarantor merges or amalgamates with or into or consolidates with, or transfers all
or substantially all of its assets to, the Company or another Guarantor in a transaction in
compliance with Section 5.01 of the Indenture; or

(iii) the Guarantor is designated an Unrestricted Subsidiary in compliance with the terms of
the Indenture;

and in each such case, the Guarantor has delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided for relating to such
transactions have been complied with and that such release is authorized and permitted hereunder
and under the Indenture.

If all of the conditions to release contained in this Section 2.04 and the Indenture have been
satisfied, the Trustee shall execute any documents reasonably requested by the Company or any
Guarantor in order to evidence the release of such Guarantor from its obligations under its
Guarantee endorsed on the Notes and under Article Ten of the Indenture.

 

4

 

Section 2.05. Assumption of Terms of The Indenture. The New Guarantor hereby assumes, agrees
to be bound and shall have the benefit of all obligations and terms of the Indenture applicable to
a Guarantor.

ARTICLE III

MISCELLANEOUS PROVISIONS

Section 3.01. Terms Defined. For all purposes of this Second Supplemental Indenture, except
as otherwise defined or unless the context otherwise requires, terms used in capitalized form in
this Second Supplemental Indenture and defined in the Indenture have the meanings specified in the
Indenture.

Section 3.02. Indenture. Except as amended hereby, the Indenture and the Notes are in all
respects ratified and confirmed and all the terms shall remain in full force and effect.

Section 3.03. Governing Law. THIS SECOND SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

Section 3.04. Successors. All agreements of the Company and any Guarantor in the Indenture
and the Notes shall bind their respective successors. All agreements of the Trustee, any
additional trustee and any Paying Agents in the Indenture or this Second Supplemental Indenture
shall bind its successor.

Section 3.05. Multiple Counterparts. The parties may sign multiple counterparts of this
Second Supplemental Indenture. Each signed counterpart shall be deemed an original, but all of
them together represent the same agreement.

Section 3.06. Effectiveness. The provisions of this Second Supplemental Indenture will take
effect immediately upon its execution and delivery by the Trustee in accordance with the provisions
of Article Eight of the Indenture.

Section 3.07. Trustee Disclaimer. The Trustee accepts the amendment of the Indenture effected
by this Second Supplemental Indenture and agrees to execute the trust created by the Indenture as
hereby amended, but only upon the terms and conditions set forth in the Indenture, including the
terms and provisions defining and limiting the liabilities and responsibilities of the Trustee,
which terms and provisions shall in like manner define and limit its liabilities and
responsibilities in the performance of the trust created by the Indenture as hereby amended, and
without limiting the generality of the foregoing, the Trustee shall not be responsible in any
manner whatsoever for or with respect to any of the recitals or statements contained herein, all of
which recitals or statements are made solely by the Company and the Guarantors, or for or with
respect to (i) the validity or sufficiency of this Second Supplemental Indenture or any of the
terms or provisions hereof, (ii) the proper authorization hereof by the Company and each Guarantor
by corporate action or otherwise, (iii) the due execution hereof by the Company and each Guarantor,
(iv) the consequences (direct or indirect and whether deliberate or inadvertent) of any amendment
herein provided for, and the Trustee makes no representation with respect to any such matters.

 

5

 

Section 3.08. Agent for Service; Submission to Jurisdiction; Waiver of Immunities. By the
execution and delivery of this Second Supplemental Indenture, each of the Company and each
Guarantor (i) acknowledges that it has, by separate written instrument, designated and appointed CT
Corporation System as its authorized agent upon which process may be served in any suit, action or
proceeding arising out of or relating to the Notes, the Indenture or this Second Supplemental
Indenture that may be instituted in any Federal or State court in the State of New York, Borough of
Manhattan, or brought under Federal or State securities laws or brought by the Trustee (whether in
its individual capacity or in its capacity as Trustee hereunder), and acknowledges that CT
Corporation System has accepted such designation, (ii) submits to the jurisdiction of any such
court in any such suit, action or proceeding, and (iii) agrees that service of process upon CT
Corporation System and written notice of said service to it (mailed or delivered to its Executive
Director at its principal office as specified in Section 11.02 of the Indenture), shall be deemed
in every respect effective service of process upon it in any such suit or proceeding. Each of the
Company and each Guarantor further agree to take any and all action, including the execution and
filing of any and all such documents and instruments as may be necessary to continue such
designation and appointment of CT Corporation System, in full force and effect so long as the
Indenture shall be in full force and effect; provided that the Company may and shall (to the extent
CT Corporation System ceases to be able to be served on the basis contemplated herein), by written
notice to the Trustee, designate such additional or alternative agents for service of process under
this Section 3.08 that (i) maintains an office located in the Borough of Manhattan, The City of New
York in the State of New York, (ii) are either (x) counsel for the Company or (y) a corporate
service company which acts as agent for service of process for other Persons in the ordinary course
of its business and (iii) agrees to act as agent for service of process in accordance with this
Section 3.08. Such notice shall identify the name of such agent for process and the address of
such agent for process in the Borough of Manhattan, The City of New York, State of New York. Upon
the request of any Holder, the Trustee shall deliver such information to such Holder.
Notwithstanding the foregoing, there shall, at all times, be at least one agent for service of
process for the Company and the New Guarantor, if any, appointed and acting in accordance with this
Section 3.08.

 

6

 

SIGNATURES

IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be
duly executed as of the date first written above.

	 	 	 	 	 
	 	THE NEW GUARANTOR:

0606890 B.C. LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	THE COMPANY:

CATALYST PAPER CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Vice President and General Counsel 	 
	 
	 	THE EXISTING GUARANTORS:

CATALYST PAPER

by its managing partner

CATALYST PAPER CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Vice President and General Counsel 	 
	 
	 	CATALYST PAPER FINANCE LIMITED

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	CATALYST PAPER HOLDINGS INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 

 

7

 

	 	 	 	 	 
	 	CATALYST PAPER JAPAN LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	James E. Armitage 	 
	 	 	Title:  	Director 	 
	 
	 	CATALYST PAPER (USA) INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	CATALYST PULP AND PAPER SALES INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	CATALYST PULP OPERATIONS LIMITED

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	CATALYST PULP SALES INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	ELK FALLS PULP AND PAPER LIMITED

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	CATALYST PAPER SERVICES (HUNGARY) LIMITED LIABILITY
COMPANY

 	 
	 	By:  	 	 
	 	 	Name:  	Pat Sakai 	 
	 	 	Title:  	Managing Director 	 

 

8

 

	 	 	 	 	 
	 	PACIFIC PAPERS SALES INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	PACIFICA PAPERS SALES LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	PACIFIC PAPERS US INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	PACIFIC POPLARS INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	THE TRUSTEE:

WELLS FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

 

9

 

GUARANTEE

The undersigned (the “New Guarantor”) hereby unconditionally guarantees, to the extent
set forth in the Indenture dated as of May 15, 2003 by and among Catalyst Paper Corporation,
formerly named Norske Skog Canada Limited, as issuer, the Guarantors named therein and Wells Fargo
Bank, National Association, as Trustee (as amended, restated or supplemented from time to time, the
“Indenture”), and subject to the provisions of the Indenture, (a) the due and punctual
payment of (i) the principal of, and premium, if any, and interest on the Notes, when and as the
same shall become due and payable, whether at maturity, by acceleration or otherwise, and (ii)
interest on overdue principal of, and premium, if any, on the Notes and, to the extent permitted by
law, interest, and the due and punctual performance of all other obligations of the Company to the
Holders or the Trustee, all in accordance with the terms set forth in Article Ten of the Indenture,
and (b) in case of any extension of time of payment or renewal of any Notes or any of such other
obligations, that the same will be promptly paid in full when due or performed in accordance with
the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise.

The obligations of the New Guarantor to the Holders and to the Trustee pursuant to this
Guarantee and the Indenture are expressly set forth in Article Ten of the Indenture and reference
is hereby made to the Indenture for the precise terms and limitations of this Guarantee.
Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the
Indenture.

IN WITNESS WHEREOF, the New Guarantor has caused this Guarantee to be signed by a duly
authorized officer on June [____], 2006.

	 	 	 	 	 
	 	0606890 B.C. LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal CounselExhibit 10.2.1

Exhibit 10.2.1

 

CATALYST PAPER CORPORATION

and

WELLS FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE

 

FIRST SUPPLEMENTAL INDENTURE

Dated as of July 14, 2006

to

INDENTURE

Dated as of March 23, 2004

by and among

CATALYST PAPER CORPORATION, as Issuer

The GUARANTORS named therein

and

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

 

7 3/8% Senior Notes Due March 1, 2014

 

 

 

 

	 	 	 	 	 
	ARTICLE I

	REAFFIRMATION OF OBLIGATIONS OF THE GUARANTORS

	 
	 	 	 	 
	Section 1.01 Reaffirmation
	 	 	2	 
	 
	 	 	 	 
	ARTICLE II

	GUARANTEE OF NOTES

	 
	 	 	 	 
	Section 2.01 Guarantee
	 	 	2	 
	Section 2.02 Execution and Delivery of Guarantee
	 	 	3	 
	Section 2.03 Limitation of Guarantee
	 	 	3	 
	Section 2.04 Release of Guarantor
	 	 	4	 
	Section 2.05 Assumption of Terms of the Indenture
	 	 	4	 
	 
	 	 	 	 
	ARTICLE III

	MISCELLANEOUS PROVISIONS

	 
	 	 	 	 
	Section 3.01 Terms Defined
	 	 	4	 
	Section 3.02 Indenture
	 	 	4	 
	Section 3.03 Governing Law
	 	 	4	 
	Section 3.04 Successors
	 	 	4	 
	Section 3.05 Multiple Counterparts
	 	 	5	 
	Section 3.06 Effectiveness
	 	 	5	 
	Section 3.07 Trustee Disclaimer
	 	 	5	 
	Section 3.08 Agent for Service, Submission to Jurisdiction, Waiver of Immunities
	 	 	5	 

 

i

 

FIRST SUPPLEMENTAL INDENTURE dated as of July 14, 2006, by and among CATALYST PAPER
CORPORATION, formerly named NORSKE SKOG CANADA LIMITED, a Canadian corporation (the “COMPANY”),
0606890 B.C. LTD., a British Columbia corporation (the “NEW GUARANTOR”), the guarantors set forth
on the signature pages hereto (the “EXISTING GUARANTORS”, and together with the New Guarantor, the
“GUARANTORS”), and WELLS FARGO BANK, NATIONAL ASSOCIATION as trustee under the hereafter defined
Indenture (the “TRUSTEE”).

WHEREAS, the Company and the Existing Guarantors previously executed and delivered to the
Trustee an indenture dated as of March 23, 2004 (the “Indenture”), providing for the issuance of an
unlimited principal amount of the Company’s 7 3/8% Senior Notes Due March 1, 2014 (the “Notes”);
and

WHEREAS, there have been issued and are now outstanding under the Indenture, Notes in the
aggregate principal amount of $250,000,000; and

WHEREAS, the Company is the holder of all of the issued and outstanding shares of the New
Guarantor; and

WHEREAS, the Indenture provides that under certain circumstances the New Guarantor shall
execute and deliver to the Trustee a supplemental indenture pursuant to which the New Guarantor
shall unconditionally guarantee all of the Company’s obligations under the Notes and the Indenture
on the terms and conditions set forth herein (the “Guarantee”); and

WHEREAS, the New Guarantor desires, by this First Supplemental Indenture (the “ First
Supplemental Indenture”), to unconditionally guarantee all of the Company’s obligations under the
Notes and the Indenture on the terms set forth herein; and

WHEREAS, the Existing Guarantors desire, by this First Supplemental Indenture, to expressly
reaffirm, jointly and severally, the obligations of the Existing Guarantors under the Indenture and
under Guarantees endorsed on the Notes; and

WHEREAS, all the conditions and requirements necessary to make this First Supplemental
Indenture a valid, binding and legal instrument in accordance with its terms have been performed
and fulfilled by the parties hereto and the execution and delivery thereof have been in all
respects duly authorized by the parties hereto.

 

 

 

NOW, THEREFORE, in consideration of the above premises, each party agrees, for the benefit of
the others and for the equal and ratable benefit of the Holders of the Notes, as follows:

ARTICLE I

REAFFIRMATION OF OBLIGATIONS OF THE GUARANTORS

Section 1.01 Reaffirmation. Each Existing Guarantor hereby expressly and unconditionally
reaffirms each and every covenant, agreement and undertaking of such Existing Guarantor in the
Indenture, and also hereby expressly and unconditionally reaffirms each and every covenant,
agreement and undertaking in its Guarantee endorsed on the Notes outstanding on the date of this
First Supplemental Indenture and in each Guarantee endorsed on any Notes delivered hereafter.

ARTICLE II

GUARANTEE OF NOTES

Section 2.01 Guarantee.

The New Guarantor hereby jointly and severally unconditionally guarantees, on a senior
unsecured basis, to each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee and its successors, irrespective of: (i) the validity and enforceability of the Indenture,
the Notes or the obligations of the Company or any other Guarantors to the Holders or the Trustee
hereunder or thereunder; or (ii) the absence of any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or default of a
Guarantor, that: (a) the principal of, premium, if any, interest on the Notes will be duly and
punctually paid in full when due, whether at maturity, by acceleration or otherwise, and interest
on the overdue principal of, and premium if any, and (to the extent permitted by law) interest and
all other obligations of the Company or any Guarantor to the Holders or the Trustee hereunder or
thereunder (including amounts due the Trustee under Section 6.07 of the Indenture) and all other
obligations under the Indenture or the Notes will be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment
or renewal of any Notes or any of such other obligations, the same will be promptly paid in full
when due or performed in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed, or
failing performance of any other obligation of the Company to the Holders, for whatever reason, the
New Guarantor will be obligated to pay, or to perform or cause the performance of, the same
immediately. An Event of Default under the Indenture or the Notes shall constitute an event of
default under this Guarantee, and shall entitle the Holders of Notes or the Trustee to accelerate
the obligations of the Guarantor hereunder in the same manner and to the same extent as the
obligations of the Company.

The New Guarantor, by execution of this Guarantee, agrees that its obligations hereunder shall
be unconditional, irrespective of the validity, regularity or enforceability of the Indenture or
the Notes, the absence of any action to enforce the same, any waiver or consent by any Holder with
respect to any provisions hereof or thereof, any release of any other Guarantor, the recovery of
any judgment against the Company, any action to enforce the same, whether or not a Guarantee is
affixed to any particular Note, or any other circumstance which might otherwise constitute a legal
or equitable discharge or defense of a Guarantor. The New Guarantor, by execution of this
Guarantee, waives the benefit of diligence, presentment, demand of payment, filing of claims with a
court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding
first against the Company, protest, notice and all demands whatsoever and covenants that the
Guarantee shall not be discharged except by complete performance of the obligations contained in
the Notes, the Indenture and this Guarantee. This Guarantee is a guarantee of payment and not of
collection. If any Holder or the Trustee is required by any court or otherwise to return to the
Company or to any Guarantor, or any custodian, trustee, liquidator or other similar official acting
in relation to the Company or such Guarantor, any amount paid by the Company or such Guarantor to
the Trustee or such Holder, this Guarantee, to the extent theretofore discharged, shall be
reinstated in full force and effect. The New Guarantor further agrees that, as between it, on the one hand, and
the Holders and the Trustee, on the other hand, (a) subject to Article Thirteen of the Indenture,
the maturity of the obligations guaranteed hereby may be accelerated as provided in Article Five of
the Indenture for the purposes of this Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (b)
in the event of any acceleration of such obligations as provided in Article Five of the Indenture,
such obligations (whether or not due and payable) shall forthwith become due and payable by the New
Guarantor for the purpose of this Guarantee.

 

2

 

This Guarantee shall remain in full force and effect and continue to be effective should any
petition be filed by or against the Company for liquidation or reorganization, should the Company
become insolvent or make an assignment for the benefit of creditors or should a receiver or trustee
be appointed for all or any significant part of the Company’s assets, and shall, to the fullest
extent permitted by law, continue to be effective or be reinstated, as the case may be, if at any
time payment and performance of the Notes are, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee on the Notes, whether as a
“voidable preference,” “fraudulent transfer” or otherwise, all as though such payment or
performance had not been made. In the event that any payment, or any part thereof, is rescinded,
reduced, restored or returned, the Notes shall, to the fullest extent permitted by law, be
reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or
returned.

No shareholder, officer, director, employee or incorporator, past, present or future, of the
New Guarantor, as such, shall have any personal liability under this Guarantee by reason of his,
her or its status as such shareholder, officer, director, employee or incorporator.

Section 2.02 Execution and Delivery Of Guarantee.

To further evidence the Guarantee set forth in Section 2.01 hereof, the New Guarantor hereby
agrees that a notation of such Guarantee, substantially in the form included in Annex C of the
Indenture, shall be endorsed on each Note authenticated and delivered by the Trustee after Article
Thirteen of the Indenture with respect to such New Guarantor becomes effective in accordance with
Section 10.13 of the Indenture and such Guarantee shall be executed by either manual or facsimile
signature of an Officer of the New Guarantor. The validity and enforceability of the Guarantee
shall not be affected by the fact that it is not affixed to any particular Note.

The New Guarantor hereby agrees that its Guarantee set forth in Section 2.01 hereof shall
remain in full force and effect notwithstanding any failure to endorse on each Note a notation of
such Guarantee.

If an Officer of the New Guarantor whose signature is on the Indenture or a Guarantee no
longer holds that office at the time the Trustee authenticates the Note on which such Guarantee is
endorsed or at any time thereafter, the New Guarantor’s Guarantee of such Note shall be valid
nevertheless.

The delivery of any Note by the Trustee, after the authentication thereof under the Indenture,
shall constitute due delivery of the Guarantee set forth in the Indenture on behalf of the New
Guarantor.

Section 2.03 Limitation of Guarantee.

The obligations of each Guarantor are limited to the maximum amount as will, after giving
effect to all other contingent and fixed liabilities of such Guarantor and after giving effect to
any collections from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to its contribution obligations
under the Indenture, result in the obligations of such Guarantor under the Guarantee not
constituting a fraudulent conveyance or fraudulent
transfer under federal or state law. Each Guarantor that makes a payment or distribution under
a Guarantee shall be entitled to a contribution from each other Guarantor in a PRO RATA amount
based on the net assets of each Guarantor, determined in accordance with GAAP.

 

3

 

Section 2.04 Release of Guarantor.

A Guarantor shall be released from all of its obligations under its Guarantee if:

(i) the Guarantor has sold all of its assets or the Company and its Restricted
Subsidiaries have sold all of the Capital Stock of the Guarantor owned by them, in each case in a
transaction in compliance with the terms of the Indenture (including Sections 10.10 and 8.01
thereof);

(ii) the Guarantor merges or amalgamates with or into or consolidates with, or transfers
all or substantially all of its assets to, the Company or another Guarantor in a transaction in
compliance with Section 8.01 of the Indenture; or

(iii) the Guarantor is designated an Unrestricted Subsidiary in compliance with the terms
of the Indenture;

and in each such case, the Guarantor has delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided for relating to such
transactions have been complied with and that such release is authorized and permitted hereunder
and under the Indenture.

If all of the conditions to release contained in this Section 2.04 and the Indenture have been
satisfied, the Trustee shall execute any documents reasonably requested by the Company or any
Guarantor in order to evidence the release of such Guarantor from its obligations under its
Guarantee endorsed on the Notes and under Article Thirteen of the Indenture.

Section 2.05 Assumption of Terms of The Indenture. The New Guarantor hereby assumes, agrees
to be bound and shall have the benefit of all obligations and terms of the Indenture applicable to
a Guarantor.

ARTICLE III

MISCELLANEOUS PROVISIONS

Section 3.01 Terms Defined. For all purposes of this First Supplemental Indenture, except as
otherwise defined or unless the context otherwise requires, terms used in capitalized form in this
First Supplemental Indenture and defined in the Indenture have the meanings specified in the
Indenture.

Section 3.02 Indenture. Except as amended hereby, the Indenture and the Notes are in all
respects ratified and confirmed and all the terms shall remain in full force and effect.

Section 3.03 Governing Law. THIS FIRST SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

Section 3.04 Successors. All agreements of the Company and any Guarantor in the Indenture and
the Notes shall bind their respective successors. All agreements of the Trustee, any additional
trustee and any Paying Agents in the Indenture or this First Supplemental Indenture shall bind its
successor.

 

4

 

Section 3.05 Multiple Counterparts. The parties may sign multiple counterparts of this First
Supplemental Indenture. Each signed counterpart shall be deemed an original, but all of them
together represent the same agreement.

Section 3.06 Effectiveness. The provisions of this First Supplemental Indenture will take
effect immediately upon its execution and delivery by the Trustee in accordance with the provisions
of Article Nine of the Indenture.

Section 3.07 Trustee Disclaimer. The Trustee accepts the amendment of the Indenture effected
by this First Supplemental Indenture and agrees to execute the trust created by the Indenture as
hereby amended, but only upon the terms and conditions set forth in the Indenture, including the
terms and provisions defining and limiting the liabilities and responsibilities of the Trustee,
which terms and provisions shall in like manner define and limit its liabilities and
responsibilities in the performance of the trust created by the Indenture as hereby amended, and
without limiting the generality of the foregoing, the Trustee shall not be responsible in any
manner whatsoever for or with respect to any of the recitals or statements contained herein, all of
which recitals or statements are made solely by the Company and the Guarantors, or for or with
respect to (i) the validity or sufficiency of this First Supplemental Indenture or any of the terms
or provisions hereof, (ii) the proper authorization hereof by the Company and each Guarantor by
corporate action or otherwise, (iii) the due execution hereof by the Company and each Guarantor,
(iv) the consequences (direct or indirect and whether deliberate or inadvertent) of any amendment
herein provided for, and the Trustee makes no representation with respect to any such matters.

Section 3.08 Agent for Service; Submission to Jurisdiction; Waiver of Immunities. By the
execution and delivery of this First Supplemental Indenture, each of the Company and each Guarantor
(i) acknowledges that it has, by separate written instrument, designated and appointed CT
Corporation System as its authorized agent upon which process may be served in any suit, action or
proceeding arising out of or relating to the Notes, the Indenture or this First Supplemental
Indenture that may be instituted in any Federal or State court in the State of New York, Borough of
Manhattan, or brought under Federal or State securities laws or brought by the Trustee (whether in
its individual capacity or in its capacity as Trustee hereunder), and acknowledges that CT
Corporation System has accepted such designation, (ii) submits to the jurisdiction of any such
court in any such suit, action or proceeding, and (iii) agrees that service of process upon CT
Corporation System and written notice of said service to it (mailed or delivered to its Executive
Director at its principal office as specified in Section 1.05 of the Indenture), shall be deemed in
every respect effective service of process upon it in any such suit or proceeding. Each of the
Company and each Guarantor further agree to take any and all action, including the execution and
filing of any and all such documents and instruments as may be necessary to continue such
designation and appointment of CT Corporation System, in full force and effect so long as the
Indenture shall be in full force and effect; provided that the Company may and shall (to the extent
CT Corporation System ceases to be able to be served on the basis contemplated herein), by written
notice to the Trustee, designate such additional or alternative agents for service of process under
this Section 3.08 that (i) maintains an office located in the Borough of Manhattan, The City of New
York in the State of New York, (ii) are either (x) counsel for the Company or (y) a corporate
service company which acts as agent for service of process for other Persons in the ordinary course
of its business and (iii) agrees to act as agent for service of process in accordance with this
Section 3.08. Such notice shall identify the name of such agent for process and the address of such
agent for process in the Borough of Manhattan, The City of New York, State of New York. Upon the
request of any Holder, the Trustee shall deliver such information to such Holder. Notwithstanding
the foregoing, there shall, at all times, be at least one agent for service of process for the
Company and the New Guarantor, if any, appointed and acting in accordance with this Section 3.08.

 

5

 

SIGNATURES

IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be
duly executed as of the date first written above.

	 	 	 	 	 
	 	
THE NEW GUARANTOR:

0606890 B.C. LTD.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	THE COMPANY:

CATALYST PAPER CORPORATION

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Vice President and General Counsel 	 
	 
	 	

THE EXISTING GUARANTORS:

CATALYST PAPER

by its managing partner

CATALYST PAPER CORPORATION

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Vice President and General Counsel 	 
	 	

CATALYST PAPER FINANCE LIMITED

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 	

CATALYST PAPER HOLDINGS INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel	 

 

6

 

	 	 	 	 	 
	 	
CATALYST PAPER JAPAN LTD.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	James E. Armitage	 
	 	 	Title:  	Director	 
	 	

CATALYST PAPER (USA) INC.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	CATALYST PULP AND PAPER SALES INC.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	

CATALYST PULP OPERATIONS LIMITED

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	

CATALYST PULP SALES INC.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	

ELK FALLS PULP AND PAPER LIMITED

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	
CATALYST PAPER SERVICES (HUNGARY) LIMITED LIABILITY
COMPANY

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Pat Sakai 	 
	 	 	Title:  	Managing Director 	 

 

7

 

	 	 	 	 	 
	 	
PACIFICA PAPERS SALES INC.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	
PACIFICA PAPERS SALES LTD.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	
PACIFICA PAPERS US INC.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	
PACIFICA POPLARS INC.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	
PACIFICA POPLARS LTD.

 	 
	 	By:  	                                                      
 	 
	 	 	Name:  	Valerie Seager 	 
	 	 	Title:  	Corporate Secretary and Legal Counsel 	 
	 
	 	
THE TRUSTEE:

WELLS FARGO BANK, NATIONAL
ASSOCIATION, AS TRUSTEE

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

 

8

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