Document:

Exhibit 10.53

Exhibit 10.53

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     This Amended and Restated Employment Agreement (the “Agreement”) is made and entered into as
of the 23rd day of April, 2008, by and between Triad Guaranty Inc., a Delaware
corporation (the “Company”), and Mark K. Tonnesen (“Employee”).

WITNESSETH:

     WHEREAS, the Company and Employee previously entered into an Employment Agreement, dated
September 9, 2005 (the “Original Agreement”); and

     WHEREAS, the Original Agreement was supplemented by a Letter Agreement dated September 9, 2005
(the “Letter Agreement”) as well as an Amendment to Letter Agreement between Mark K. Tonnesen and
Triad Guaranty Inc. dated December 26, 2006 (the “Amendment to Letter Agreement”) (the Original
Agreement, as amended by the Letter Agreement and the Amendment to Letter Agreement being referred
to as the “Prior Agreement”); and

     WHEREAS, Section 14(f) of the Prior Agreement provides that the parties may amend the Prior
Agreement if such amendment is made in writing and is signed by the parties; and

     WHEREAS, the parties desire to amend and restate the terms and conditions of Employee’s
employment with Company as set forth hereinafter; and

     WHEREAS, the Company and Employee intend for this Agreement to supersede and replace the terms
of the Prior Agreement;

     NOW, THEREFORE, in consideration of the mutual covenants and obligations hereinafter set
forth, the parties hereto agree as follows:

     1. Employment and Term. The Company hereby employs Employee and Employee accepts employment
with the Company as President and Chief Executive Officer of the Company, on the terms and
conditions herein set forth, for a period commencing on the date of the signing of this Agreement
and expiring on December 31, 2008, unless sooner terminated pursuant to Section 7. Employee shall
have such duties, responsibilities and authority as are commensurate with his position, and shall
report to the Chairman of the Company’s Board of Directors (the “Board”). Employee shall also
perform such other or additional duties on behalf of the Company and its subsidiaries and
affiliates as may be reasonably assigned to him by the Board from time to time.

     2. Extent of Services. During the term hereof, Employee shall devote his entire attention and
energy to the business and affairs of the Company on a full-time basis and shall not be engaged in
any other business activity, regardless of whether such business activity is pursued for gain,
profit or other pecuniary advantage, unless the Company otherwise consents; but this shall not be
construed as preventing Employee from investing his assets in such form or manner as will not
require any services on the part of Employee in the operation of the affairs of the companies in
which such investments are made and will not otherwise conflict with the

 

 

provisions of this Agreement. Full-time, as used above, shall mean a forty (40) hour work
week, or such longer work week as the Board shall from time to time adopt. The foregoing shall not
be deemed to prevent Employee from participating in any charitable or not-for-profit organization
to a reasonable extent, provided however that Employee does not receive any salary or other
remuneration from such charity or not-for-profit organization. Employee will be subject to and
shall comply with all codes of conduct, personnel policies and procedures applicable to senior
executives of the Company including, without limitation, policies regarding sexual harassment,
conflicts of interest and insider trading, of which he shall have received in writing.

     3. Compensation.

     (a) Salary. During the term of this Agreement, the Company shall pay Employee an annual
salary of $495,000.00 (“Annual Salary”), payable in accordance with the Company’s regular
payroll procedures. For any period of Voluntary Retirement Extension (as defined in Section
7(e)), the Company shall pay Employee an annual salary of $990,000, payable in accordance
with the Company’s regular payroll procedures.

     (b) Bonus. In addition to his Annual Salary, Employee shall receive: (i) retention
bonuses equal to (A) $150,000, payable on the first regular pay period following July 1,
2008, provided that Employee is employed on July 1, 2008 and (B) $300,000, payable on the
first regular pay period following December 31, 2008, provided that Employee is employed on
December 31, 2008; and (ii) a severance bonus equal to $225,000, payable on the first
regular pay period following December 31, 2008, provided that Employee is employed on
December 31, 2008. Notwithstanding the foregoing, the bonus payments under (i) and (ii)
shall be paid earlier (if applicable) on the first regular pay period following the
effective date of Employee’s Retirement, Involuntary Termination Without Cause or Good
Reason Termination.

     (c) Restricted Stock Grant; Existing Awards. Employee shall receive a grant of
restricted stock under the terms of the Triad Guaranty Inc. 2006 Long-Term Stock Incentive
Plan (as amended and restated on January 1, 2008) (the “Plan”) for 40,500 shares (the
“Award”). The shares subject to the Award shall vest in a lump sum three (3) years from the
date of grant or two (2) years from the date of Retirement (as defined in Section 7(e)), if
earlier. The terms of the Award and the terms of all other options, restricted stock
awards, phantom stock awards or other equity awards granted to Employee prior to and
remaining outstanding on the date hereof shall be governed in all respects by the terms of
the Plan and the respective award agreements under which they were originally granted.

     4. Benefits. Employee shall be entitled to participate in all medical and other employee
plans of the Company, if any, on the same basis as other executives of the Company, subject in all
cases to the respective terms of such plans.

     5. PTO. Employee shall be entitled to paid time off (“PTO”) in accordance with the Company’s
PTO policy in effect at the time the PTO is taken as if Employee had at least ten (10) years of
service with the Company. In the event that the full PTO is not taken by Employee, no

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PTO time shall accrue for use in future years, except in accordance with the Company’s
then-existing policy for the carry forward of accrued PTO.

     6. Expenses. Employee shall be entitled to prompt reimbursement for all reasonable expenses
incurred by him in furtherance of the business of the Company in connection with his performance of
his duties hereunder, in accordance with the policies and procedures established for executive
officers of the Company, and provided Employee properly accounts for such expenses. In addition,
Employee shall be entitled to prompt reimbursement for up to $5,000.00 of legal fees and expenses
incurred by Employee in the negotiation of this Agreement. All reimbursements must be made no
later than the end of the calendar year following the calendar year in which the expense was
incurred. The expenses eligible for reimbursement under this Section 6 in any calendar year shall
not affect any expenses eligible for reimbursement or in-kind benefits to be provided to Employee
in any other calendar year. Employee’s rights under this Section 6 shall not be subject to
liquidation or exchange for any other benefit.

     7. Termination.

     (a) Death. This Agreement and Employee’s employment hereunder shall terminate
immediately upon Employee’s death. In such event, the Company shall be obligated to pay only
(i) Employee’s salary to the end of the month in which he dies; and (ii) a lump sum death
benefit to Employee’s estate equal to Employee’s Annual Salary at the time of his death.

     (b) Incapacity. To the extent permitted by law, if Employee is absent from his
employment for reasons of illness or other physical or mental incapacity which renders him
unable to perform the essential functions of his position, with or without reasonable
accommodation, for more than an aggregate of ninety (90) days, whether or not consecutive,
in any period of twelve (12) consecutive months, then upon at least sixty (60) days’ prior
written notice to Employee, if such is consistent with applicable law, the Company may
terminate this Agreement and Employee’s employment hereunder, unless, within that notice
period, Employee shall have resumed performance of the essential functions of his positions,
with or without reasonable accommodation. In the event of a termination of employment under
this Section 7(b), the Company shall be obligated to pay Employee his salary from the date
of such termination until the earlier of (i) the date on which coverage commences under the
long-term disability insurance policy maintained by the Company for the benefit of Employee,
if any, or (ii) the date two (2) months after the date of such termination.

     (c) Termination by the Company.

     (i) The Company may terminate this Agreement and Employee’s employment
hereunder at any time for Cause. As used herein, “Cause” shall mean:

     (A) a material breach by Employee of his duties and obligations
hereunder, including but not limited to gross negligence in the performance
of his duties and responsibilities or the willful failure to

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follow the Board’s directions; provided, however, that Cause shall not
exist unless the Company has provided Employee with written notice setting
forth the existence of the non-performance, failure or breach and Employee
shall not have cured same within thirty (30) days after receiving such
notice;

     (B) willful misconduct by Employee which in the reasonable
determination of the Board has caused or is likely to cause material injury
to the reputation or business of the Company;

     (C) any act of fraud, material misappropriation or other dishonesty by
Employee; or

     (D) Employee’s conviction of a felony.

In the event of termination for Cause, the Company shall pay Employee his
salary up to the date that is thirty (30) days after the delivery to him of
the notice of termination, which date shall be for all purposes of this
Section 7(c)(i) the date of termination of his employment, unless there has
been a cure under Section 7(c)(i)(A). In the event of termination for Cause,
Employee shall not receive any previously unpaid bonus or bonuses except any
earned but unpaid bonus with respect to any bonus measurement period ended
prior to the date of termination.

     (ii) Notwithstanding anything contained herein to the contrary, the Company
also may terminate this Agreement and Employee’s employment hereunder for any reason
whatsoever, upon no less than sixty (60) days’ prior written notice to Employee. In
the event that the Company terminates this Agreement pursuant to the provisions of
this Section 7(c)(ii) (an “Involuntary Termination Without Cause”), then, for
purposes of Section 8, Employee shall be deemed to have terminated because of
Retirement pursuant to Section 7(e).

     (d) Termination by Employee. Other than on account of a Good Reason Termination (as
defined in this Section 7(d)) or Retirement (as defined in Section 7(e)), Employee may
terminate this Agreement and his employment hereunder for any reason whatsoever, upon no
less than sixty (60) days’ prior written notice to the Company. In the event that Employee
terminates this Agreement pursuant to the provisions of this Section 7(d) without “Good
Reason” as hereinafter defined, Employee shall be entitled to receive his salary up to the
date of termination set forth in the notice of termination, and in such event, Employee
shall not receive any previously unpaid bonus or bonuses except any earned but unpaid bonus
with respect to bonus measurement period ended prior to the date of termination. Employee
may also resign for Good Reason (a “Good Reason Termination”). As used herein, “Good
Reason” shall mean:

     (i) a material breach by the Company of its obligations hereunder, including
but not limited to a material and adverse change in the status or position of
Employee as an executive officer of the Company including, without

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limitation, a material diminution in duties, responsibilities or authority,
except in connection with the incapacity of Employee, or non-payment of Annual
Salary or other compensation due hereunder; or

     (ii) the Company, without Employee’s consent (such consent not to be
unreasonably withheld), transfers or relocates the office of Employee which would
require Employee to be based more than fifty (50) miles distance from his initial
office in Winston-Salem, North Carolina;

provided, however, that Good Reason shall not exist unless Employee has provided the
Company with a written notice setting forth the reasons for the existence of Good
Reason, and the Company has not cured the reasons for the existence of Good Reason
within thirty (30) days after receiving such notice.

     (e) Voluntary Retirement. Employee may retire from the Company as of the close of
business on December 31, 2008, or such earlier date as mutually agreed to by Employee and
the Company (“Retirement”). Notwithstanding the foregoing, the Company may, at its election
made at any time by providing written notice to Employee prior to December 31, 2008, delay
the date of Employee’s Retirement from December 31, 2008 for a period not to extend beyond
March 31, 2009 (“Voluntary Retirement Extension”). Employee’s failure to continue to perform
his duties during any Voluntary Retirement Extension will be treated as a termination by
Employee under Section 7(d) without Good Reason and Employee will not be entitled to the
benefits provided under Section 8.

     (f) Subsidiary Offices and Positions; Company and Subsidiary Directorships. Upon
termination of Employee’s employment for any reason, his employment by any subsidiary of the
Company shall likewise then be terminated. In addition, upon such termination Employee
shall immediately resign as a member of the Board and the board of directors of any
subsidiary of the Company on which Employee is serving at the time of such termination, and
he shall evidence such resignation by promptly submitting his letter of resignation to the
chairman of the Board and each such subsidiary board of directors.

     8. Benefits Upon Termination

     (a) Involuntary Termination Without Cause, Good Reason Termination and Retirement. If
Employee’s employment is terminated as a result of an Involuntary Termination Without Cause,
a Good Reason Termination, or Retirement (the day of such Involuntary Termination Without
Cause, Good Reason Termination or Retirement, the “Termination Date”), then Employee shall
be entitled to the following benefits (as applicable):

     (i) Retirement Payments: $675,000 in total retirement payments, payable in 18
equal monthly installments in advance over a period commencing as of the first day
of the seventh month following the Termination Date and ending on the first day of
the 24th month following the Termination Date (such

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24-month period following the Termination Date being referred to herein as the
“Post-Termination Period”).

     (ii) Continued Participation in Company Health Care Plan: In addition to the
other benefits provided in Section 8(a)(i), Employee shall be entitled to the
following benefits:

     (A) Employee shall be entitled to participate (treating Employee as an
“active employee” of the Company for this purpose) in any health care,
dental, vision or prescription drug plan maintained by the Company
(collectively, “Company health care plan”) during the Post-Termination
Period (the “Continuation Coverage”). The Company, consistent with sound
business practices, shall use its best efforts to provide Employee and his
dependents with the Continuation Coverage under the Company health care
plan, including, if necessary, amending the applicable provisions of the
Company health care plan and negotiating the addition of any necessary
riders to any group insurance contract. During the Post-Termination Period,
Employee shall pay the entire premium required for the Continuation Coverage
under the Company health care plan. During the first eighteen (18) months
of the Post-Termination Period, the premium required for the Continuation
Coverage shall be equal to the premium required by the continuation of
coverage requirements of Section 4980B of the Code and Part 6 of Title I of
the Employee Retirement Income Security Act of 1974, as amended (“COBRA”)
for such Continuation Coverage (the “COBRA Rate”). During the remainder of
the Post-Termination Period, the premium required for the Continuation
Coverage shall be the greater of the COBRA Rate or the actuarially
determined cost of the Continuation Coverage as determined by an actuary
selected by the Company.

     (B) If at any time during the Post-Termination Period the Company is
unable for whatever reason to provide Employee with the Continuation
Coverage under any Company health care plan, the Company, consistent with
sound business practices, shall use its best efforts to provide Employee
coverage under an individual policy of health insurance providing coverage
that is substantially identical to the Continuation Coverage to be provided
under the Company health care plan. In such event, Employee shall pay the
entire premium charged for coverage of Employee and his dependents under the
individual policy.

     (C) The Continuation Coverage provided to Employee and his dependents
pursuant to this Section 8(a)(ii) is intended to satisfy the continuation of
coverage requirements of COBRA. In the event that the period of
Continuation Coverage expires prior to the end of the period of continuation
coverage to which Employee and his dependents would be entitled under COBRA
(the “COBRA Period”), Employee and/or his dependents may elect continuation
coverage under COBRA (“COBRA

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Coverage”) for the remainder of the COBRA Period. Employee and/or his
dependents shall be responsible for paying the full amount of the premium
charged for such COBRA Coverage under the Company health care plan at the
COBRA Rate. Notwithstanding the foregoing provisions of this Section
8(a)(ii), in the event that the Continuation Coverage for whatever reason
does not satisfy the continuation of coverage requirements of COBRA,
Employee and/or his dependents shall be entitled to elect COBRA Coverage in
lieu of the Continuation Coverage described in this Section 8(a)(ii). In
such event, Employee and/or his dependents shall be responsible for paying
the full amount of the premium charged for such COBRA Coverage under the
Company health care plan at the COBRA Rate.

     (D) During the Post-Termination Period, the Company shall pay to
Employee a monthly special benefit as determined pursuant to the provisions
of this sub-paragraph (D) (the “Special Benefit”). The amount of the
monthly Special Benefit shall be equal to the amount of the monthly premium
actually paid by Employee for the Continuation Coverage for Employee and his
dependents required by this Section 8(a)(ii). The Special Benefit shall be
payable on the 20th day of each calendar month during the
Post-Termination Period, or within ten (10) business days thereafter.

     (iii) Other Welfare Benefits. In addition to participation in the Company
health care plan during the Post-Termination Period, and solely in the case of
Retirement (and not in the case of Involuntary Termination Without Cause or Good
Reason Termination), Employee shall, as and to the extent permitted by (1) Section
409A of the Internal Revenue Code of 1986, as amended (including all applicable
regulations or other guidance promulgated pursuant thereto, “Code”), and (2) the
terms and conditions of the Welfare Benefit Plans (as they exist on the date
hereof), also be entitled to participate (treating Employee as an “active” employee
of the Company for this purpose) during the Post-Termination Period in all other
welfare benefit plans and arrangements sponsored from time to time by the Company
for the benefit of its employees, including, without limitation, life insurance,
accident, disability policies or arrangements which are generally available to the
active employees of the Company (collectively, “Welfare Benefit Plans”) in which he
participated immediately prior to his Termination Date and the benefits under such
other Welfare Benefit Plans shall be made available under the same terms and
conditions available to active employees (e.g., employee contributions are required
for certain benefits that are in effect for active employees who are similarly
situated). Notwithstanding the foregoing, Employee acknowledges and agrees that
upon his Retirement, he shall no longer be eligible to participate in, be provided
or receive any reimbursement from Employer for or under: (1) the Company’s sick
leave, vacation pay and similar programs, (2) any provision of a company car, (3)
payment of country club dues, or (4) payment of other perquisites that were
previously provided to Employee due to his position as President and Chief Executive
Officer of the Company.

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Notwithstanding clause (4) of the preceding sentence, Employee shall continue
to be entitled to reimbursement of his personal tax and accounting fees and expenses
in an amount up to $7,000.00 per year. This right of reimbursement shall continue
in effect during the term of this Agreement as set forth in Section 1 and for a
period of twenty-four months following the date of his Retirement. Employee
acknowledges that such right of reimbursement shall terminate upon a termination of
Employee’s employment for any reason other than Retirement.

     (b) Termination Other Than Involuntary Termination Without Cause, Good Reason
Termination and Retirement. If Employee’s employment terminates for any reason other than
Involuntary Termination Without Cause, a Good Reason Termination or Retirement, Employee
shall not be entitled to any of the benefits listed in Section 8(a).

     (c) Consultant Work and Compliance with Section 9 Restrictive Covenants as Condition to
Receipt of Benefits. As a continuing condition to the receipt of any benefits described in
Section 8(a), Employee shall be reasonably available to perform services for the Company as
an independent consultant on an as-needed basis during the Post-Termination Period;
provided, however, that any such consulting work provided by Employee to the Company shall
not exceed (i) during the period beginning on the first day after the Retirement Date and
ending on the later of six (6) months from the Retirement Date or June 30, 2009, ten (10)
days per calendar month; (ii) during the period beginning on the first day of the expiration
of the period under clause (i) and ending on the later of six (6) months from that date or
December 31, 2009, eight (8) days per calendar month; and (iii) thereafter five (5) days per
calendar month. The services to be performed by Employee in his capacity as an independent
consultant shall be those as may be reasonably assigned him by the Board or its delegate
from time to time. Employee shall be entitled to reimbursement for all reasonable expenses
incurred by him during the Post-Termination Period, provided that any expense exceeding
$1,000 shall be subject to the prior written approval of the Company. During the
Post-Termination Period, Employee shall be treated as an independent contractor for federal
and state income tax withholding, employment tax and tax reporting purposes. Employee
acknowledges and agrees that during the Post-Termination Period he will not be an
employee of the Company but will be an independent contractor. In addition, notwithstanding
anything else in this Agreement to the contrary, (i) if for any reason any court determines
that any of the restrictions contained in Section 9 hereof are not enforceable, (ii)
Employee breaches or threatens to breach any of the restrictions in Section 9, or (iii)
Employee challenges the enforceability of any of the restrictions in Section 9 (whether
through court proceedings, an administrative or arbitral proceeding, or in any other manner
whatsoever), the Company shall have no obligation to pay the benefits provided in this
Section 8.

     (d) Reductions. If the Company is obligated by law (including the WARN Act or any
similar state or foreign law) to pay Employee severance pay, a termination indemnity, notice
pay, or the like, then any post-termination payments provided in this Section 8 shall be
reduced by the amount of any such other severance pay, termination indemnity, notice pay or
the like, as applicable.

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     (e) Release. Notwithstanding anything herein to the contrary, the payment of any
post-termination payments provided in this Section 8 to Employee shall be subject to the
execution by Employee (and failure to revoke) of a general release of the Company and its
affiliates of any and all claims under this Agreement or related to or arising out of
Employee’s employment hereunder, in a form and manner satisfactory to the Company.

     9. Restrictive Covenant. During the term of this Agreement and for a period of two (2) years
after the termination of this Agreement by the Company or Employee, Employee shall not, either as
an individual on his own account; as a partner, joint venturer, employee, agent, or salesman for
any person; as an officer, director or stockholder (other than a beneficial holder of not more than
five percent (5%) of the outstanding voting stock of a company having at least two hundred and
fifty (250) holders of voting stock) of a corporation; or otherwise:

     (a) enter into or engage in the private mortgage insurance business or any other credit
enhancement business in which, as of the date of such termination, the Company is then
engaged or actively considering being engaged within:

     (i) any area of the United States or any foreign country in which the Company
is then doing business;

     (ii) in the event that any court determines that the area set forth in the
preceding subparagraph is too broad to be enforceable, each and every state of the
United States or foreign country in which the Company had a market share, based on
industry data, of at least four percent (4%) of net new mortgage insurance written
as of the end of the quarter next preceding the date of termination of this
Agreement; or

     (iii) in the event that any court determines that the area set forth in the
preceding subparagraphs is too broad to be enforceable, each and every metropolitan
statistical area of the United States or any foreign country in which the Company
had a market share, based on industry data, of at least four percent (4%) of net new
mortgage insurance written as of the end of the quarter next preceding the date of
termination of this Agreement; or

     (iv) in the event that any court determines that the area set forth in the
preceding subparagraphs is too broad to be enforceable, the States of Florida,
Illinois and North Carolina; or

     (v) in the event that any court determines that the area set forth in the
preceding subparagraphs is too broad to be enforceable, the State of North Carolina.

     (b) solicit or attempt to solicit any of the Company’s customers or prospective
customers with whom Employee has had substantive business communications as an employee of
the Company in the performance of his duties and responsibilities hereunder with the intent
or purpose to perform for such customer the same or similar services or to sell to such
customer the same or similar products, including other credit enhancement

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products, which Employee performed for or sold to such customer during the term of his
employment hereunder; or

     (c) solicit or recruit any person who is an employee or agent of the Company, for
employment in the private mortgage insurance business or any other credit enhancement
business or for the purpose of soliciting or attempting to solicit any of the Company’s
customers or prospective customers as prohibited by Section 9(b) above.

Employee and the Company agree and acknowledge that the Company does business on a
nationwide basis, with customers located throughout the United States, and may do business
world wide with customers located throughout the world and that any breach by Employee of
the restrictive covenant contained herein would immeasurably and irreparably damage the
Company. Employee and the Company agree and acknowledge that the duration, scope and
geographic areas applicable to the noncompetition covenants in this Section 9 are fair,
reasonable and necessary to protect legitimate business interests of the Company, and that
adequate compensation has been received by Employee for such obligations.

     10. Confidential Information and Discoveries. Employee acknowledges that he will, as a result
of his duties as an employee of the Company, have access to and be in a position to receive
confidential information, including trade secrets, relating to the Company. Therefore, Employee
agrees that during his employment by the Company and thereafter he will not divulge to, or use for
the benefit of, himself or any other person, any information concerning any inventions,
discoveries, improvements, processes, methods, trade secrets, research or secret data (including,
without limitation, customer or supplier lists, formulas, computer programs, software development
or executive monitor systems), or other confidential matters possessed, owned or used by the
Company that may be obtained or learned by Employee in the course of or as a result of his
employment hereunder unless (i) such disclosure is authorized by the Company, (ii) such
confidential information becomes generally available to and known by the public (other than as a
result of disclosure directly or indirectly by Employee) or (iii) such confidential information
becomes available to Employee on a nonconfidential basis from a source other than the Company, or
its employees or agents, provided that such source is not and was not bound by a confidentiality
agreement with or other obligation of secrecy to the Company. The expiration or termination of
employment shall not be deemed to release Employee from his duties hereunder not to convert to his
own use or the use of others the rights or properties of the Company as described herein.

     11. Enforcement. Both parties recognize that the services to be rendered under this Agreement
by Employee are special, unique and of extraordinary character and that in the event of the breach
by Employee of any of the terms and conditions of Section 9 or 10 of this Agreement to be performed
by him, then the Company shall be entitled, if it so elects, to institute and prosecute proceedings
in any court of competent jurisdiction, either in law or in equity, to obtain damages for any
breach hereof, or to enforce the specific performance hereof by Employee or to enjoin Employee from
performing acts prohibited above during the period herein covered, but nothing herein contained
shall be construed to prevent such other remedy in the courts as the Company may elect to invoke.

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     12. Return of Documents. Upon the termination of this Agreement for any reason, Employee
shall forthwith return and deliver to the Company and shall not retain any original or copies of
any books, papers, price lists or customer contracts, bids or customer lists, files, books of
account, notebooks and other documents and data relating to the performance by Employee of his
duties hereunder, all of which materials are hereby agreed to be the property of the Company.

     13. Tax and Other Restrictions. Notwithstanding anything herein to the contrary:

     (a) Excess Parachute Payments. In the event that payment of any amount under this
Agreement would cause Employee to be the recipient of an excess parachute payment within the
meaning of Code Section 280G(b), the amount of the payments to be made to Employee pursuant
to this Agreement shall be reduced to an amount equal to one dollar less than the amount
that would cause the payments hereunder to be excess parachute payments. The manner in which
such reduction occurs, including the items of payment and amounts thereof to be reduced,
shall be agreed to by Employee and the Company.

     (b) Payments in Excess of $1 Million. If any payment hereunder would not be deductible
by the Company for federal income tax purposes by reason of Code section 162(m), or any
similar or successor statute (excluding Code Section 280G), such payment shall be deferred
and the amount thereof shall be paid to Employee at the earliest time that such payment
shall be deductible by the Company.

     (c) Deferred Compensation Payments. To the extent applicable, the parties hereto
intend that this Agreement comply with Code Section 409A. The parties agree that this
Agreement shall at all times be interpreted and construed in a manner to comply with Code
Section 409A and that should any provision be found not in compliance with Code Section
409A, the parties are contractually obligated to execute any and all amendments to this
Agreement deemed necessary and required by the Company’s legal counsel to achieve compliance
with Code Section 409A. By execution and delivery of this Agreement, Employee irrevocably
waives any objections he may have to any amendments required by Code Section 409A. The
parties also agree that in no event shall any payment required to be made pursuant to this
Agreement that is considered nonqualified deferred compensation within the meaning of Code
Section 409A be made to Employee unless he has incurred a separation from service (as
defined in Code Section 409A). In the event amendments are required to make this Agreement
compliant with Code Section 409A, the Company shall use its best efforts to provide Employee
with substantially the same benefits and payments he would have been entitled to pursuant to
this Agreement had Code Section 409A not applied, but in a manner that is compliant with
Code Section 409A. The manner in which the immediately preceding sentence shall be
implemented shall be the subject of good faith negotiations of the parties. The parties
also agree that in no event shall any payment required to be made pursuant to this Agreement
that is considered nonqualified deferred compensation within the meaning of Code Section
409A be accelerated in violation of Code Section 409A. The parties further agree that any
payments of deferred compensation that are made to a specified employee (as defined in Code
Section 409A) as a result of a separation from service cannot

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commence under Code Section 409A until the lapse of six (6) months after a separation
from service (or death of the specified employee, if earlier).

     14. Miscellaneous.

     (a) Notices. Any notice required or permitted to be given under this Agreement shall be
sufficient if in writing and if sent by registered or certified mail to Employee or the
Company at the address set forth below their signatures at the end of this Agreement or to
such other address as they shall notify each other in writing.

     (b) Assignment. This Agreement shall be binding upon and inure to the benefit of the
Company and its successors and permitted assigns and Employee and his personal
representatives, heirs, legatees and beneficiaries. This Agreement may be assigned by the
Company with the consent of Employee to a fiscally responsible entity that assumes the
obligations set forth herein, but shall not be assignable by Employee.

     (c) Applicable Law. This Agreement shall be construed in accordance with the laws of
the State of North Carolina in every respect, including, without limitation, validity,
interpretation and performance. Any dispute between the parties hereto, arising under or
relating to this Agreement, or Employee’s employment with the Company, other than for an
action by the Company under Section 11 hereof for specific performance, injunction or other
equitable remedy to enforce Sections 9 and 10 hereof shall be settled by arbitration in
Winston-Salem, North Carolina before a single arbitrator in accordance with the
then-applicable rules of the American Arbitration Association. Such arbitrator may award the
prevailing party its reasonable attorneys’ fees and expenses, and judgment upon the award
rendered may be entered in any court having jurisdiction thereof.

     (d) Headings. Section headings and numbers herein are included for convenience of
reference only and this Agreement is not to be construed with reference thereto. If there be
any conflict between such numbers and headings and the text hereof, the text shall control.

     (e) Severability. If for any reason any portion of this Agreement shall be held
invalid or unenforceable, it is agreed that the same shall not affect the validity or
enforceability of the remainder hereof. The portion of the Agreement which is not invalid or
unenforceable shall be considered enforceable and binding on the parties and the invalid or
unenforceable provision(s), clause(s) or sentence(s) shall be deemed excised, modified or
restricted to the extent necessary to render the same valid and enforceable and this
Agreement shall be construed as if such invalid or unenforceable provision(s), clause(s), or
sentences(s) were omitted. The provisions of this Section 14(e), as well as Sections 9 and
10 hereof, shall survive the termination of this Agreement.

     (f) Entire Agreement. This Agreement contains the entire agreement of the parties with
respect to its subject matter and supersedes all previous agreements between the parties,
including but not limited to the Prior Agreement, the Letter Agreement and the Amendment to
Letter Agreement. No officer, employee, or representative of the Company has any authority
to make any representation or promise in connection with

12

 

this Agreement or the subject matter thereof that is not contained herein, and Employee
represents and warrants he has not executed this Agreement in reliance upon any such
representation or promise. No modification of this Agreement shall be valid unless made in
writing and signed by the parties hereto.

     (g) Waiver of Breach. The waiver by either party of a breach of any provision of this
Agreement by the other party shall not operate or be construed as a waiver of any subsequent
breach by the breaching party.

     (h) Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, but all of which together shall constitute one
agreement.

[Signature Page Follows]

13

 

     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly
authorized officer and Employee has signed this Agreement all on the day and year first above
written.

	 	 	 	 	 
	 	 	TRIAD GUARANTY INC.

a Delaware corporation
	 
	 	 	 	 
	 

	 	 	 	/s/ Earl F. Wall
	 	 	 
	 

	 	 	 	Earl F. Wall
	 

	 	 	 	Senior Vice President, Secretary
	 

	 	 	 	and General Counsel
	 

	 	Address:
	 	101 South Stratford Road
	 

	 	 	 	Winston-Salem, N.C. 27104
	 
	 	 	 	 
	 	 	MARK K. TONNESEN
	 
	 	 	 	 
	 

	 	 	 	/s/ Mark K. Tonnesen
	 	 	 
	 

	 	Address:
	 	4620 Cherry Hill Lane
	 

	 	 	 	Winston-Salem, NC 27104

14Exhibit 10.1

EXHIBIT 10.1

FIFTH AMENDMENT

     This Fifth Amendment
(the “Agreement”) to the Credit Agreement referred to below is dated as
of April 30, 2008, by and among BOWATER INCORPORATED, a corporation organized under the laws of
Delaware, in its capacity as Borrower under the Credit Agreement referred to below (the
“Borrower”), certain Subsidiaries of the Borrower party
hereto (the “Subsidiary Grantors”),
AbitibiBowater Inc., a corporation organized under the laws of Delaware (the “Parent”), the Lenders
and the Canadian Lenders party hereto (collectively, the “Consenting Lenders”) pursuant to
an authorization (in the form attached hereto as Exhibit A, each a “Lender Authorization”)
and WACHOVIA BANK, NATIONAL ASSOCIATION, as administrative agent (the “Administrative Agent”) for
the Lenders party to the Credit Agreement referred to below.

STATEMENT OF PURPOSE:

     The 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, 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 Canadian
Lenders agree to amend the Credit Agreement as more specifically set forth herein. 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) or the Collateral Agreement (as amended by this Agreement), as
applicable.

     2. Credit Agreement Amendments. The Credit Agreement is hereby amended by:

     (a) Section 1.1 of the Credit Agreement is hereby
amended by:

          (i) amending and restating the following definitions

     “New Borrower Mortgages” means those certain mortgages, deeds of trust,
security agreements, subordination agreements or other real property security documents
encumbering the New Borrower Fixed Assets, in each case in form and substance reasonably
satisfactory to the Administrative Agent and the Canadian Administrative Agent and executed
by the applicable New Borrower in favor of the Administrative Agent, for the ratable
benefit of the Secured Parties and the Canadian Secured Parties, as

1

 

amended, restated, supplemented or otherwise modified from time to time. Unless
specifically excluded, the Supplemental New Borrower Mortgage shall be a New Borrower
Mortgage.

     “New Borrowers” means (a) Bowater Alabama LLC (formerly known as Bowater Alabama,
Inc.), an Alabama limited liability company (the “Coosa Pines Borrower”), (b) Bowater
Newsprint South LLC, a Delaware limited liability company (“BNS Holdings”) and (c) Bowater
Newsprint South Operations LLC (formerly known as Bowater Newsprint South, Inc.), a
Delaware corporation and the successor by merger to Bowater Mississippi, LLC (the
“Grenada Borrower”).

          (ii) adding the following new definition in proper alphabetical order:

     “Supplemental New Borrower Mortgage” means that certain mortgage, deed of
trust, security agreement, subordination agreement or other real property security document
encumbering a fee interest in the Coosa Pines Mill and a leasehold interest in the Coosa
Pines Real Property or otherwise subordinating the interests of 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 “Supplemental New Borrower
Mortgagor”), in the Coosa Pines Mill or Coosa Pines Real Property to the interests of
the Administrative Agent and the Canadian Administrative Agent therein, in each case in
form and substance reasonably satisfactory to the Administrative Agent and the Canadian
Administrative Agent and executed by the Supplemental New Borrower Mortgagor in favor of
the Administrative Agent, for the ratable benefit of the Secured Parties and the Canadian
Secured Parties, as amended, restated, supplemented or otherwise modified from time to
time.

     “Supplemental New Borrower Mortgagor” has the meaning set forth in the
definition of Supplemental New Borrower Mortgage.

          (b) Amendment to Section 5.3. The following new subsection (d) shall be added to
Section 5.3:

     “(d) Delivery of Documentation Pursuant to Section 8.10(e)(ii). If the
requested borrowing, conversion or continuation of any Loan or the requested issuance or
extension of any Letter of Credit would cause the aggregate principal amount of all
Obligations outstanding as of the date of such borrowing, conversion, continuation,
issuance or extension (after giving effect to the requested borrowing, conversion, continuation shall have received each item required to be delivered thereto pursuant to Section
8.10(e)(ii)(A), 8.10(e)(ii)(B), 8.10(e)(ii)(C) and
8.10(e)(ii)(D). in all cases, in accordance with the terms and provisions thereof
(or as such terms and conditions may be amended, modified or waived in accordance with the
terms of Section 13.2).”

     (c) Amendment to Section 8.10. Clause (ii) of subsection (e) of Section 8.10 of the
Credit Agreement is hereby amended and restated as follows:

          “(ii) New Borrower Loan Documentation.

 

 

     (A) As soon as practicable, but in no event later than April 15, 2008, the Administrative
Agent shall have received:

     (1) evidence satisfactory to the Administrative Agent that the Borrower shall be
diligently pursuing in good faith the rendering of the solvency opinions referred to in
Sections 8.10(e)(ii)(B) and 8.10(e)(ii)(C) by a third party consultant
reasonably acceptable to the 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 Administrative
Agent, confirming (x) that the New Borrowers own, free and clear of any Liens, the New
Borrower Fixed Assets and (y) the ability of the New Borrowers to grant to the
Administrative Agent, on behalf of the Secured Parties and the Canadian Secured Parties, a
perfected first priority security interest in the New Borrower Fixed Assets without the
consent or approval of any third Person; and

     (B) As soon as practicable, but in no event later than May 15, 2008, the Administrative Agent
shall have received:

     (1) a copy of a solvency opinion from Houlihan Lokey Howard & Zukin Financial Advisors,
Inc. or another opinion provider reasonably acceptable to the Administrative Agent as to the
solvency of the Original Borrower after giving effect to the New 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 Borrower to the Credit Agreement, 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 Canadian Administrative Agent with regard to the New Borrowers (including,
without limitation, an updated Schedule 6.1 (b));

 

 

     (4) a certificate of a Responsible Officer of each New
Borrower certifying as to the
incumbency and genuineness of the signature of each officer of each New Borrower executing the Loan
Documents 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 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 Borrower as in effect on the date hereof, (y) resolutions duly adopted by the board of
directors or other governing body of each New 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 Borrower under the laws of its jurisdiction of incorporation or formation;

     (5) an originally executed counterpart of a collateral agreement, in form and substance
satisfactory to the Administrative Agent, executed by each New Borrower in favor of the
Administrative Agent and the other Secured Parties and all other Security Documents entered into in
connection therewith (the “New Borrower Security Documents”), together with all schedules,
exhibits and annexes thereto;

     (6) 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 Collateral granted
by each New Borrower under the New Borrower Security Documents and evidence satisfactory to the
Administrative Agent that upon such filings and recordations such security interests constitute
valid and perfected first priority Liens therein;

     (7) the results of a Lien search (including a search as to judgments, pending litigation and
tax matters) made against each New 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 Borrower, indicating among other things that the assets of each New Borrower are free and
clear of any Liens (except Permitted Liens);

     (8) evidence in form and substance reasonably satisfactory to the Administrative Agent
confirming: (x) the adequacy and effectiveness of the property and liability insurance coverage of
the Borrower (including, without limitation, coverage of each New Borrower) and its Subsidiaries
and (y) the interest of the Administrative Agent (as loss payee and additional insured and, with
respect to the real property subject to the New Borrower Mortgages (other than the Supplemental New
Borrower Mortgage), as mortgagee) with respect to such insurance coverage;

 

 

     (9) a duly executed counterpart of each New Borrower Mortgage (other than the Supplemental
New Borrower Mortgage);

     (10) all filings and recordations that are necessary to perfect the security interests of
the Administrative Agent, on behalf of itself, the other Secured Parties and the Canadian
Secured Parties, in the Collateral granted by each New Borrower under each New Borrower
Mortgage (other than the Supplemental New 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;

     (11) duly executed copies of amended and restated Notes to replace the Notes issued to the
applicable Lenders on or prior to the date each New Borrower is joined pursuant to clause (2)
above;

     (12) the original New Borrower Note, along with a blank endorsement executed by the
Original Borrower (which such endorsement shall be in form and substance satisfactory to the
Administrative Agent);

     (13) favorable opinions of counsel of each New Borrower addressed to the Administrative
Agent and the Lenders with respect to the New Borrowers, this Agreement, each of the New
Borrower Mortgages (other than the Supplemental New Borrower Mortgage) and the other Loan
Documents to which the New Borrowers are a party 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

     (14) such other instruments, documents and certificates as the Administrative Agent shall
reasonably request.

     (C) As soon as practicable, but in no event later than May 22,
2008, the Administrative Agent
shall have received a copy of a solvency opinion from Houlihan Lokey Howard & Zukin
Financial
Advisors, Inc. or another opinion provider reasonably acceptable to the
Administrative Agent as to the
solvency of each of the New Borrowers (other than BNS
Holdings if BNS Holdings is a holding company that
holds only the Capital Stock of the Coosa Pines Borrower and the Grenada Borrower and has no
creditors other than the Lenders), in each case after giving effect to the New Borrower
Transactions
and the transactions contemplated by the Fourth Amendment, this Agreement and the joinder
agreement
referred to in Section 8.10(e)(ii)(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) As soon as practicable, 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 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 Borrower
Mortgage;

     (2) a duly executed counterpart of the Supplemental New Borrower Mortgage;

     (3) all filings and recordations that are necessary to perfect the security interests
of the Administrative Agent, on behalf of itself, the other Secured Parties and the Canadian
Secured Parties, in the Collateral granted by the Supplemental New 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 Borrower Mortgage, all
right, title and interest of the Supplemental New Borrower Mortgagor shall be subordinated
in all respects to the security interests of the Administrative Agent, on behalf of itself,
the other Secured Parties and the Canadian Secured Parties, with respect to the interests
subject to the Supplemental New Borrower Mortgage);

     (4) favorable opinions of counsel of the Supplemental New Borrower Mortgagor addressed
to the Administrative Agent and the Lenders with respect to the Supplemental New 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) Within forty-five (45) days of the date upon which each New Borrower is joined as a Credit
Party pursuant to Section 8.10(e)

(ii)(B):

     (1) a final title policy, insuring the first priority Liens of the Secured Parties and
the Canadian Secured Parties and showing no Liens prior to the Liens of the Secured Parties
and the Canadian 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 each of the Coosa Pines Mill Real Property and Grenada Mill Real Property (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);

     (2) copies of all recorded documents creating exceptions to the title policies referred to in
Section 8.10(e)(ii)(E)(l);

     (3) 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;

     (4) 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 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 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;

     (5) a Phase I environmental assessment and such other
environmental report reasonably requested by the 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 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

     (6) 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
Administrative Agent, all in form, consent and scope reasonably
satisfactory to the Administrative Agent.”

     (c) Amendment to Section 11.1 (d). Section ll.l(d) of the Credit
Agreement is hereby amended and restated in its entirety as follows:

     “(d) The Borrower or any other Credit Party shall default in the performance or
observance of any covenant or agreement contained in Sections 5.4, 7.1
(other than, solely during the time period from the Fourth Amendment Effective Date
through the Conversion Date, any reporting required pursuant to subsections (g) and (h)
thereof (it being agreed and acknowledged that subsections (g) and (h) thereof shall be
subject to this subsection (d) on and after the Conversion Date)), 7.2,
7.5(e)(i), 8.2(b)(ii), 8.10(e)(i), 8.10(e)(ii) or
Articles IX or X.”

     3. Amendment to Collateral Agreement. The Collateral Agreement is hereby amended by
adding the following new clause (d) to Section 4.9:

     “(d) No Partnership/LLC Interests issued by any Grantor (i) shall be traded on a
Securities exchange or in Securities markets, (ii) shall by their terms expressly provide
that they are Securities governed by Article 8 of the UCC, (iii) shall be Investment
Company Securities, (iv) shall be held in a Securities Account or (iv) shall be
certificated unless such certificates are delivered to the Administrative Agent with
appropriate instruments of transfer.”

     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 Borrower, the Parent and the
Subsidiary 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 a corresponding amendment to the Canadian
Credit Agreement, in form and substance substantially consistent with this Agreement (with such
changes as are applicable only to the Canadian Credit Agreement), duly executed by the Canadian
Administrative Agent, the Canadian Borrower, the Parent, each Canadian

 

 

Guarantor and the requisite Consenting Lenders (whether directly or through a lender
authorization); and

     (e) the Administrative Agent shall have received such other instruments, documents and
certificates as the Administrative Agent shall reasonably request in connection with the
execution of this Agreement.

     5. 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 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.

     6. Representations and Warranties/No Default. By their execution hereof,

     (a) 
the Parent, the Borrower and each Subsidiary Grantor (including, without limitation, BNSO
(as defined below)) hereby certifies, represents and warrants to the Administrative Agent and the
Lenders that after giving effect to the amendments set forth in Sections 2 and 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 Borrower, the Parent and each of the Subsidiary Grantors (including, without
limitation, BNSO (as defined below)) 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 Borrower, the
Parent and each of the Subsidiary Grantors, and each such document constitutes the
legal, valid and binding obligation of the Borrower, the Parent and each of the
Subsidiary 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.

     7. Acknowledgement by Bowater Newsprint South Operations LLC. Bowater Mississippi
LLC, a Mississippi limited liability company and a Subsidiary Guarantor, was merged with and
into Bowater Newsprint South Operations LLC (formerly known as Bowater Newsprint South, Inc.),
a Delaware limited liability company (“BNSO”), with BNSO as the surviving entity of such
merger. By its execution hereof, BNSO hereby acknowledges and agrees that BNSO shall be bound
by the Credit Agreement and the other Loan Documents as a “Subsidiary Guarantor” as if it were
a Subsidiary Guarantor on the Closing Date. BNSO shall comply with, and be subject to, and
have the benefit of, and hereby assumes and agrees to be bound by, all of the terms,
conditions, covenants, agreements and obligations applicable to a Subsidiary Guarantor set
forth in the Credit Agreement and the other Loan Documents. Each party hereto hereby agrees
that each reference to a “Credit Party” or a “Subsidiary Guarantor” in the Credit Agreement
and in the other Loan Documents shall be deemed to include BNSO.

     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 Parent Guaranty Agreement, the
Subsidiary Guaranty Agreement, the Collateral Agreement and each other Security Document to
which it is a party, (b) confirms and reaffirms its obligations under the Parent Guaranty
Agreement, the Subsidiary Guaranty Agreement, the Collateral Agreement and each other Security
Document to which it is a party and (c) agrees that the Parent Guaranty Agreement, the
Subsidiary 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. Acknowledgement by Parent. The Parent hereby acknowledges receipt of a copy of
the Credit Agreement and agrees, for the benefit of the Administrative Agent and the Secured
Parties, to be bound thereby and to comply with the terms thereof insofar as such terms are
applicable to it (including, without limitation, Sections 7.1(f), 10.6(1) and
ll.l(o)).

     10. Governing
Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO THE CONFLICTS OF LAW PRINCIPLES THEREOF.

     11. 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.

 

 

     12. 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 hereto, all parties hereto agree to execute an original of this Agreement
as well as any facsimile, telecopy, pdf or other reproduction hereof.

[Signature Pages Follow]

 

 

     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 INCORPORATED

 	 
	 	By:  	/s/ William G. Harvey
 	 
	 	 	Name:  	William G. Harvey 	 
	 	 	Title:  	SVP and CFO 	 
	 
	 	PARENT:

ABITIBIBOWATER INC.
 	 
	 	By:  	/s/ William G. Harvey
 	 
	 	 	Name:  	William G. Harvey 	 
	 	 	Title:  	SVP and CFO 	 
	 
	 	SUBSIDIARY GRANTORS:

BOWATER NEWSPRINT SOUTH OPERATIONS LLC

 	 
	 	By:  	BOWATER NEWSPRINT SOUTH LLC     
Its: Manager
 	 
	 
	 	 	By:  
 	/s/ William G. Harvey	 
	 	 	Name:  	William G. Harvey 	 
	 	 	Title:  	Manager 	 
	 
	 	BOWATER AMERICA INC.

 	 
	 	By:  	/s/
William A. Mccormick 	 
	 	 	Name:  	William A. Mccormick 	 
	 	 	Title:  	Assistant Secretary 	 
	 
	 	BOWATER NUWAY INC.
 	 
	 	By:  	/s/ William A. Mccormick 	 
	 	 	Name:  	William A. Mccormick 	 
	 	 	Title:  	Asst. Secretary 	 
	 

[Fifth Amendment — Bowater]

[Signature Pages Continue]

 

 

	 	 	 	 	 
	 	BOWATER NUWAY MID-STATES INC.

 	 
	 	By:  	/s/ William A. Mccormick 	 
	 	 	Name:  	William A. Mccormick 	 
	 	 	Title:  	Asst. Secretary 	 
	 
	 	BOWATER ALABAMA LLC

 	 
	 	By:  	/s/ William G. Harvey
 	 
	 	 	Name:  	William G. Harvey 	 
	 	 	Title:  	Manager 	 
	 

[Fifth Amendment — Bowater]

[Signature Pages Continue]

 

 

	 	 	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative Agent
(on behalf of itself and the Consenting Lenders who have executed
a Lender Authorization) and as Issuing Lender, Swingline
Lender and a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ James Travagline
 
James Travagline	 	 
	 

	 	Title:
	 	Vice President	 	 

[Fifth Amendment to US Credit Agreement — Bowater]

 

 

     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.

	 	 	 	 	 	 	 
	 	 	Wachovia Bank, National Association	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ James Travagline
 

James Travagline
	 	 
	 

	 	Title:
	 	Vice President	 	 

[Lender Authorization — Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	WELLS FARGO FOOTHILL, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Rohan Damani
 

	 	 
	 

	 	Name:
	 	Rohan Damani	 	 
	 

	 	Title:
	 	Vice President	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	UBS Loan Finance LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Irja R. Otsa
 

	 	 
	 

	 	Name:
	 	Irja R. Otsa	 	 
	 

	 	Title:
	 	Associate Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ David B. Julie
 

David B. Julie
	 	 
	 

	 	Title:
	 	Associate Director	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	JPMorgan Chase
Bank, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Peter Predun
 

Peter Predun
	 	 
	 

	 	Title:
	 	Executive Director	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	Carolina First Bank	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kevin M. Short
 

	 	 
	 

	 	Name:
	 	 Kevin M. Short	 	 
	 

	 	Title:
	 	Executive Vice President	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	GE BUSINESS FINANCIAL SERVICES INC. 

(Formerly known
as Merrill Lynch Business Financial Services Inc.)	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Rebecca A. Ford
 

Rebecca A. Ford
	 	 
	 

	 	Title:
	 	It’s Duly Authorized Signatory	 	 

 

 

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.

	 	 	 
	 

	 	ROB T. JOKHAI
	 

	 	Vice President
	 

	 	388 Greenwint Street
	 

	 	New York, NY 10013
	 

	 	212-816-8272

	 	 	 	 	 	 	 
	 	 	 	 	 
	 	 	Citicorp USA, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Rob Jokhai
 

Rob Jokhai
	 	 
	 

	 	Title:
	 	Vice President	 	 

[Fifth Amendment — Bowater]

 

 

Loan Documents (as defined in the
Canadian Credit Agreement) to which Canadian Lenders are parlies
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 instantancous 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.

	 	 	 	 	 	 	 
	 	 	Credit Industriel et Commercial	 	 
	 	 	[Insert name of applicable financial institution]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Anthony Rock
 

Anthony. Rock
	 	 
	 

	 	Title:
	 	Managing Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Marcus Edward
 

Marcus Edward
	 	 
	 

	 	Title:
	 	Managing Director	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	The Bank of New York	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	[ILLEGIBLE]
 

[ILLEGIBLE]
	 	 
	 

	 	Title:
	 	Vice President	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	     BANK OF MONTREAL	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Bruno Jarry
 

Bruno Jarry
	 	 
	 

	 	Title:
	 	Director	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	Export Development Canada	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Matthew Devine
 

Matthew Devine
	 	 
	 

	 	Title:
	 	Asset Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Howard Clysdale
 

Howard Clysdale
	 	 
	 

	 	Title:
	 	Loan Portfolio Manager	 	 

 

 

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.

	 	 	 	 	 	 	 
	 	 	     Bank of America, N. A.	 	 
	 	 	 	 	 
	 	 	[Insert name of applicable financial institution]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Covinne Barrett
 

Covinne Barrett
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 

[Fifth Amendment — Bowater]

 

 

Bowater Incorporated

Bowater Canadian Forest Products Inc.

Fifth Amendment

April 30,
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 Fifth Amendment dated as of
April 30, 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 (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 Fourth Amendment dated as of April
30, 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

[ILLEGIBLE] RZBLLCNY • A WHOLLY OWNED SUBSIDIARY OF RAIFFEISEN
ZENTRALBANK ÕSTERREICH AG
(RZB-AUSTRIA) 

• Head Office: A-1030 Vienna, Am Stãdtpark 9, Postal Address: A-1011 Vienna, P.O. Box 50 • Member of
UNICO Banking Group

 

 

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.

	 	 	 	 	 	 	 
	 	 	RZB Finance LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ John A. Valiska
 

John A. Valiska
	 	 
	 

	 	Title:
	 	First Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Shirley Ritch
 

Shirley Ritch
	 	 
	 

	 	Title:
	 	Assistant Vice President	 	 

[Fifth Amendment — Bowater]

 

 

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 parlies 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.

	 	 	 	 	 	 	 
	 	 	GOLDMAN SACHS CREDIT PARTNERS, L.P.	 	 
	 	 	[Insert name of
applicable financial institution]
	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Andrew Caditz
 

Andrew Caditz
	 	 
	 

	 	Title:
	 	Authorized Signatory	 	 

[Fifth Amendment — Bowater]

 

 

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.

	 	 	 	 	 	 	 
	 	 	AgFirst Farm Credit Bank	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Matt Jeffords
 

Matt Jeffords
	 	 
	 

	 	Title:
	 	Assistant Vice President	 	 

[Fifth Amendment — Bowater]

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