Document:

Exhibit 10.5

 

EXECUTION VERSION

 

 

THIRD AMENDMENT

TO THE CREDIT AGREEMENT

dated as of May 22, 2008

 

Among

 

CASCADES INC.

CASCADES USA INC.

CASCADES EUROPE SAS

(as Borrowers)

 

— and —

 

SCOTIA CAPITAL

(as Lead Arranger for the
extension

of the Unsecured Revolving Facility)

 

— and —

 

NATIONAL BANK FINANCIAL

(as Lead Arranger for the
amendments

to the financial covenant)

 

 

NATIONAL BANK OF CANADA

THE BANK OF NOVA SCOTIA

(as Co-Administrative
Agents)

 

— and —

 

THE LENDERS

FROM TIME TO TIME PARTY HERETO

 

 

MCCARTHY TÉTRAULT LLP

 

 

THIRD AMENDMENT  TO THE DECEMBER 29, 2006 CASCADES CREDIT
AGREEMENT made as of May 22, 2008.

 

	
  BETWEEN:

  	
   

  	
  CASCADES INC. (“Cascades”)

  
	
   

  	
   

  	
   

  
	
  AND :

  	
   

  	
  CASCADES USA INC.

  
	
   

  	
   

  	
   

  
	
  AND :

  	
   

  	
  CASCADES EUROPE SAS

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (each a
  “Borrower” and collectively, the “Borrowers”)

  
	
   

  	
   

  	
   

  
	
  AND:

  	
   

  	
  THE
  LENDERS PARTY TO THE CREDIT AGREEMENT REFERRED TO BELOW  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (each a
  “Lender” and collectively the “Lenders”)

  
	
   

  	
   

  	
   

  
	
  AND:

  	
   

  	
  THE
  BANK OF NOVA SCOTIA

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (as “Agent”)

  
	
   

  	
   

  	
   

  
	
  AND:

  	
   

  	
  NATIONAL
  BANK OF CANADA

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (as
  “Co-Agent”)

  

 

RECITALS

 

A.            The Borrowers, the Agent, the
Co-Agent and the Lenders are party to a credit agreement dated as of December 29,
2006, as amended as of June 27, 2007 and March 28, 2008 (the “Credit
Agreement”) providing for credit facilities in an aggregate amount of
$950,000,000 (the “Facilities”).

 

B.            The Lenders have been requested by a
request for extension and amendments dated April 17, 2008 to (i) extend
the Unsecured Revolving Facility Maturity Date to June 23, 2009, (ii) amend
the Funded Debt to Capitalization Ratio and the Interest Coverage Ratio
covenants of the Credit Agreement and (iii) make certain other amendments
to the Credit Agreement.

 

C.            The Lenders are willing to grant the
extension and amendments described in the above request and the Borrowers, the
Agent, the Co-Agent and the Lenders wish to amend the Credit Agreement to give
effect to the extension and amendments contemplated in the request in the
manner provided for in this Agreement.

 

 

NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

 

1.             Interpretation

 

1.1           Capitalized
terms used herein and defined in the Credit Agreement have the meanings
assigned to them in the Credit Agreement unless otherwise defined herein.

 

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

 

1.3           Any
reference to the Credit Agreement in any Credit Document refers to the Credit
Agreement as amended hereby.

 

2.             Amendments to the
Credit Agreement

 

2.1           Section 1.1
of the Credit Agreement is amended by deleting the definition of “Unsecured
Revolving Facility Maturity Date” and replacing it with the following:

 

                “Unsecured Revolving Facility Maturity Date”
means June 23, 2009;”

 

2.2               Article 2
of the Credit Agreement is amended by replacing Section 2.3 with the following:

 

“2.3    The Unsecured Revolving
Facility

 

a)         The
Lenders, individually and not solidarily (i.e. not jointly and severally) agree
to make available to Cascades an unsecured revolving facility (the “Unsecured
Revolving Facility”) in an aggregate amount at any time not exceeding the total
of the Commitments at such time with respect to the Unsecured Revolving
Facility. As of the date hereof and up to June 25, 2008, the Commitment of
each Lender under the Unsecured Revolving Facility will be as specified below
opposite its name and the collective Commitments of the Lenders with respect to
the Unsecured Revolving Facility will aggregate to $100,000,000.

 

3

 

	
  Name of Lender

  	
   

  	
  Commitment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  13,925,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  National Bank of Canada

  	
   

  	
  $

  	
  11,765,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Canadian Imperial Bank of Commerce

  	
   

  	
  $

  	
  11,765,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Caisse de dépôt et placement
  du Québec

  	
   

  	
  $

  	
  9,412,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Caisse centrale Desjardins

  	
   

  	
  $

  	
  9,742,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Toronto-Dominion Bank

  	
   

  	
  $

  	
  5,882,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bank of Montreal

  	
   

  	
  $

  	
  5,882,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  BNP Paribas (Canada)

  	
   

  	
  $

  	
  6,570,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Royal Bank of Canada

  	
   

  	
  $

  	
  4,118,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Deutsche Bank AG, Canada Bank

  	
   

  	
  $

  	
  2,941,000,00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  JPMorgan Chase Bank, N.A., Toronto Branch

  	
   

  	
  $

  	
  2,941,000,00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Société Générale (Canada Branch)

  	
   

  	
  $

  	
  2,941,000,00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Wachovia Capital Finance Corporation (Canada)

  	
   

  	
  $

  	
  2,353,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bank of America, N.A., Canada Branch

  	
   

  	
  $

  	
  6,714,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Rabobank Nederland, Canadian Branch

  	
   

  	
  $

  	
  3,049,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  

 

b)        As of June 25,
2008, the Commitment of each Lender under the Unsecured Revolving Facility will
be as specified below opposite its name and the collective Commitments of the
Lenders with respect to the Unsecured Revolving Facility will aggregate to
$100,000,000.

 

4

 

 

	
  Name of Lender

  	
   

  	
  Commitment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  15,984,334.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Canadian Imperial Bank of Commerce

  	
   

  	
  $

  	
  11,765,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  National Bank of Canada

  	
   

  	
  $

  	
  10,984,333.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Caisse de dépôt et placement
  du Québec

  	
   

  	
  $

  	
  9,412,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Caisse centrale Desjardins

  	
   

  	
  $

  	
  10,726,333.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Toronto-Dominion Bank

  	
   

  	
  $

  	
  5,882,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bank of Montreal

  	
   

  	
  $

  	
  5,882,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  BNP Paribas (Canada)

  	
   

  	
  $

  	
  6,570,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Royal Bank of Canada

  	
   

  	
  $

  	
  4,118,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Deutsche Bank AG, Canada Bank

  	
   

  	
  $

  	
  2,941,000,00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  JPMorgan Chase Bank, N.A., Toronto Branch

  	
   

  	
  $

  	
  2,941,000,00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Société Générale (Canada Branch)

  	
   

  	
  $

  	
  2,941,000,00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Wachovia Capital Finance Corporation (Canada)

  	
   

  	
  $

  	
  2,353,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bank of America, N.A., Canada Branch

  	
   

  	
  $

  	
  7,500,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  

 

c)         Borrowings under the Unsecured Revolving Facility may be obtained
only to the extent that there is no availability (taking into account Borrowing
Base requirements) under the Revolving Facility at the time such Borrowings are
requested.

 

d)        On June 25, 2008, the Agent will notify Cascades and the
Lenders of the adjustments, if any, which are required to be made among the
Lenders to ensure that the outstanding Borrowings under the Unsecured Revolving
Facility are owed to the Lenders in the proportion of their respective
Commitments under the Unsecured Revolving Facility.  The adjustments, if any, will be payable by
the Lenders three Business Days after the date of notification.”

 

5

 

2.3           A new Section 6.12 is
added to the Credit Agreement as follows:

 

“6.12      Usage Fee

 

(a)        Cascades
must pay to the Agent, for distribution to the Lenders  pro rata to their Commitments under
the Unsecured Revolving Facility, a usage fee on the aggregate amount of
outstanding Borrowings under the Unsecured Revolving Facility. The usage fee
will be calculated daily from the date of this Agreement at the annual rate
specified below and will be payable quarterly in arrears on the first Business
Day of the following quarter.

 

(b)        For any day, the usage fee will be calculated (i) at a rate of
0.75% if on such day the outstanding Borrowings under the Unsecured Revolving
Facility represent not more than 33 1/3% of the amount of the facility, (ii) at
a rate 1.25% if on such day the outstanding Borrowings under the Unsecured
Revolving Facility represent more than 33 1/3% of the amount of the
facility without however exceeding 66 2/3% of the amount of the facility, and (iii) at
a rate of 1.75% if on such day the outstanding Borrowings under the Unsecured
Revolving Facility represent more than 66 2/3% of the amount of the
facility.”

 

2.4           Sections
14.1 and 14.2 of the Credit Agreement are deleted and replaced by the
following:

 

“14.1      Funded Debt
to Capitalization Ratio

 

Cascades must maintain at all times, on an
adjusted consolidated basis, a Funded Debt to Capitalization Ratio of not more
than (i) 65% until June 30, 2009; and (ii) 60% thereafter.

 

14.2        Interest
Coverage Ratio

 

Cascades must maintain at all times,  on an adjusted consolidated basis, an Interest Coverage
Ratio not less than (i) 2.25:1.00 until June 30, 2009 and (ii) 2.50:1.00
thereafter.”

 

2.5           Schedule “A” of the
Credit Agreement is amended by replacing (with effect from June 25, 2008)
the grid applicable to the Unsecured Revolving Facility with the following:

 

6

 

Unsecured Revolving Facility

 

	
  Prime, US Base

  	
   

  	
  Acceptance Fee /

  Libor

  	
   

  	
  Stand- By Fee

  	
   

  
	
  0

  	
   

  	
  100 bps

  	
   

  	
  32.5 bps

  	
   

  

 

3.             Effectiveness and
Conditions Precedent

 

This Agreement will
become effective on the date that the Agent notifies the Borrowers and the Lenders
(through Intralinks in the case of the Lenders) that this Agreement has been
executed by all parties hereto, and that the following conditions precedent
have been fulfilled:

 

3.1           The payment of all fees and
expenses owing by the Borrowers to the Agent and the Lenders on the date of
this Agreement and all fees and expenses of the Agent’s counsel to such date;
and

 

3.2           Receipt of copies of the
documents evidencing the authority of the persons acting on behalf of the
Borrowers.

 

4.             Cost and Expenses

 

4.1           On the date this Agreement
becomes effective pursuant to Article 3, Cascades must pay:

 

(a)        to each Lender who has consented to the amendments described in Section 2.4
hereof an amendment fee equal to 6 bps on such Lender’s total Commitment under
the Facilities at such time (excluding however its Commitment under the
Unsecured Revolving Facility if same has not been renewed in accordance with
the Request);

 

(b)        to each Lender who has agreed pursuant to the Request to renew its
Commitment under the Unsecured Revolving Facility an extension fee equal to 30
bps on such Lender’s Commitment under the Unsecured Revolving Facility at such
time; and

 

(c)        an additional fee equal to 35 bps on the portion (if any) of such
Lender’s Commitment under the Unsecured Revolving Facility at such time which
is in excess of the amount of such Lender’s Commitment under the Unsecured
Revolving Facility on the second Business Day preceding the date on which this
Agreement becomes effective.

 

7

 

4.2                                 The Borrowers agree to pay on demand all reasonable costs and
expenses of the Agent in connection with the preparation, execution,
delivery and implementation and administration of this Agreement including the
reasonable fees and expenses of counsel for the Agent and the Co-Agent.

 

5.                                      Confirmation

 

Each of the Borrowers represents to the
Agent and the Lenders that this Agreement will not result in any Default or
Event of Default.

 

6.                                      Counterparts

 

This Agreement may be executed in any
number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered will be deemed to be
an original and all of which taken together will constitute but one and the
same agreement. Delivery of an executed counterpart of a signature page to
this Agreement by telecopier will be effective as delivery of a manually
executed counterpart of this Agreement.

 

7.                                      Governing Law

 

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

 

 

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

 

 

	
   

  	
  Cascades Inc.

  
	
   

  	
   

  
	
   

  	
  per:

  
	
   

  	
   

  	
  (s) Robert
  F. Hall

  
	
   

  	
   

  
	
   

  	
  Cascades USA Inc.

  
	
   

  	
   

  
	
   

  	
  per:

  
	
   

  	
   

  	
  (s) Robert
  F. Hall

  
	
   

  	
   

  
	
   

  	
  Cascades Europe SAS

  
	
   

  	
   

  
	
   

  	
  per:

  
	
   

  	
   

  	
  (s) Robert
  F. Hall

  

 

8

 

	
   

  	
  The Bank of Nova Scotia, as Agent

  
	
   

  	
   

  
	
   

  	
  per:

  
	
   

  	
   

  	
  (s) 
  Robert Boomhour

  
	
   

  	
   

  	
        Director

  
	
   

  	
   

  
	
   

  	
  National Bank of Canada, as Co-Agent

  
	
   

  	
   

  
	
   

  	
  per:

  
	
   

  	
   

  	
  (s) Dominic
  Albanese

  
	
   

  	
   

  
	
   

  	
  per:

  
	
   

  	
   

  	
  (s) Roch
  Ledoux

  
	
   

  	
   

  
	
   

  	
  (the
  names and signatures of the Lenders are on the next page)

  

 

9

 

	
   

  	
   

  	
  LENDERS’ SIGNATURES

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  National Bank of Canada

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per :

  	
  (s) Roch Ledoux 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  	
  (s) Dominic Albanese

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  National Bank of Canada, New York Branch

  
	
   

  	
   

  	
  (in respect of Tranche B)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per :

  	
  (s) Vincent Lima

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  	
  (s) Kambiz Mahdavl 

  
	
   

  	
   

  	
   

  	
  Assistant Vice President

  International Commercial Operations

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Bank of Nova Scotia

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per :

  	
  (s) John Santillo

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  	
  (s) David Loewen 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Bank of Nova Scotia, Houston Branch (in respect of Tranche B)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  	
  (s) J.F. Todd

  
	
   

  	
   

  	
   

  	
  Managing Director

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Canadian Imperial Bank of Commerce 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per :

  	
  (s) Peter Rawlins, Executive Director

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  	
  (s) Jens Paterson, Executive Director

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CIBC Inc., as designated Lender pursuant to Section 20.5 with respect
  to Tranche B

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per :

  	
  (s) Dominic J. Sorresso

  
	
   

  	
   

  	
   

  	
  Executive Director

  

 

10

 

 

	
   

  	
  Caisse
  de dépôt et placement du Québec

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Jean-Pierre
  Jetté, Manager

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Dominique
  Boies

  
	
   

  	
   

  	
  Vice-président
  principal

  
	
   

  	
   

  
	
   

  	
  Caisse
  centrale Desjardins

  
	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Raymond
  Trempe

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Francine
  Champoux

  
	
   

  	
   

  
	
   

  	
  Caisse
  centrale Desjardins US Branch, as
  designated Lender pursuant to Section 20.5 with respect to
  Tranche B

  
	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Michel
  Brouillet, Vice President

  
	
   

  	
   

  
	
   

  	
  Bank of
  Montreal

  
	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Bruno
  Jarry, Director

  
	
   

  	
   

  
	
   

  	
  Bank of
  Montreal, Chicago Branch (in respect of
  Tranche B)

  
	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Kristina
  H. Burden, Vice President

  
	
   

  	
   

  
	
   

  	
  BNP
  Paribas (Canada)

  
	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Edouard
  Sinor

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Frank
  L. Shaw

  
	
   

  	
   

  	
   

  
	
   

  	
  BNP
  Paribas, as designated Lender pursuant to
  Section 20.5 with respect to Tranche B and Tranche C

  
	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Benjamin
  Sileo, Vice President

  
	
   

  	
  per:

  	
  (s) Frederic
  Fournier, Vice President

  
	
   

  	
  per:

  	
  (s) Philippe
  Rouvier

  
	
   

  	
  per:

  	
  (s) Claude
  Delaire

  

 

11

 

	
   

  	
  Comerica
  Bank, operating by and through its
  Canadian Branch

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Omer
  Ahmed, Portfolio Manager

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Comerica
  Bank 

  
	
   

  	
  (in respect
  of Tranche B and Tranche C)

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Michael
  J. Doyle, Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  The Toronto-Dominion
  Bank

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Yves
  Bergeron

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Serge
  Cloutier

  
	
   

  	
   

  	
   

  
	
   

  	
  Toronto
  Dominion (Texas) LLC, as designated Lender
  pursuant to Section 20.5 with respect to Tranche B

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  Debbi L.
  Brito

  
	
   

  	
   

  	
  Authorized
  signatory

  
	
   

  	
   

  	
   

  
	
   

  	
  Royal
  Bank of Canada

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Rod
  Smith

  
	
   

  	
   

  	
  Attorney-in-Fact

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Royal
  Bank of Canada

  
	
   

  	
  (in respect
  of Tranche B)

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Dustin
  Craven

  
	
   

  	
   

  	
  Attorney-in-Fact

  

 

12

 

	
   

  	
  Deutsche
  Bank AG, Canada Branch

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Robert
  A. Johnston, Director

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Marcellus
  Leung

  
	
   

  	
   

  	
  Assistant
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  Deutsche
  Bank AG, New York Branch, with respect to
  Tranche B and Tranche C

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) EvenlynThierry,
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Eric
  Morrissey, Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMorgan
  Chase Bank, N.A., Toronto Branch

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Drew
  McDonald

  
	
   

  	
   

  	
  Executive
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMorgan
  Chase Bank, N.A., with respect to
  Tranche B

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Peter
  S. Predun

  
	
   

  	
   

  	
  Executive
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Société
  Générale (Canada Branch)

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Robert
  Pagé

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Vincent
  Gonzales

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Société
  Générale, New York Branch, with respect to
  Tranche B

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Ambrish
  D. Thanawala

  
	
   

  	
   

  	
  Managing
  Director

  

 

13

 

	
   

  	
  Bank of
  America, N. A., Canada Branch

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Nelson
  Lam, Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Bank of
  America, N. A., with respect to Tranche B

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  Michael L.
  Letson, Mr.

  
	
   

  	
   

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Rabobank
  Nederland, Canadian Branch

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Rommel
  J. Domingo

  
	
   

  	
   

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Jason
  Hoogenboom

  
	
   

  	
   

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Cooperatieve
  Centrale Raiffeissen-Boerenleenbank B. A. “Rabobank Nederland” New York Branch, as designated Lender pursuant to
  Section 20.5 with respect to Tranche B

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Brett
  Delfino

  
	
   

  	
   

  	
  Executive
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
  per:

  	
  (s) Ian
  Reece

  
	
   

  	
   

  	
  Managing
  Director

  

 

14

 

	
   

  	
  Wachovia
  Capital Finance Corporation

  
	
   

  	
  (Canada)

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Raymond
  Eghobamien

  
	
   

  	
   

  	
  Vice
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Wachovia
  Bank, National Association, as designated
  Lender pursuant to Section 20.5 with respect to Tranche B and Tranche C.

  
	
   

  	
   

  	
   

  
	
   

  	
  per :

  	
  (s) Robert
  G. McGill, Jr., Director

  

 

 

We, the
undersigned, as Designated Subsidiaries and guarantors under the Credit
Agreement, hereby agree with the terms of this Third Amending Agreement.

 

	
  CASCADES BOXBOARD U.S., INC.

  
	
  CASCADES CANADA INC.

  
	
  CASCADES PAPERBOARD INTERNATIONAL INC.

  
	
  6265642 CANADA INC.

  
	
  SCIERIE LEMAY INC.

  
	
  RABOTAGE LEMAY INC.

  
	
  DOPACO, INC.

  
	
  DOPACO PACIFIC LLC

  
	
  DOPACO LIMITED PARTNERSHIP

  
	
  DOPACO CANADA, INC.

  
	
  GARVEN INCORPORATED

  
	
  CONFERENCE CUP LTD.

  
	
  CASCADES BOXBOARD GROUP — CONNECTICUT LLC

  
	
  CASCADES AUBURN FIBER INC.

  
	
  CASCADES MOULDED PULP, INC.

  
	
  CASCADES PLASTICS INC.

  
	
  CASCADES DIAMOND, INC.

  
	
  CASCADES FINE PAPERS GROUP INC.

  
	
  CASCADES FINE PAPERS GROUP THUNDER BAY INC.

  
	
  CASCADES FINE PAPERS GROUP (SALES) INC.

  
	
  CASCADES FINE PAPERS GROUP (USA) INC.

  
	
  W.H. SMITH PAPER CORPORATION

  
	
  CASCADES TISSUE GROUP — ARIZONA INC.

  
	
  CASCADES TISSUE GROUP — IFC DISPOSABLES INC.

  
	
  CASCADES TISSUE GROUP — NEW YORK INC.

  

 

15

 

	
  CASCADES TISSUE GROUP — NORTH CAROLINA INC.

  
	
  CASCADES TISSUE GROUP — OREGON INC.

  
	
  CASCADES TISSUE GROUP — PENNSYLVANIA INC.

  
	
  CASCADES TISSUE GROUP — WISCONSIN INC.

  
	
  CASCADES TISSUE GROUP — TENNESSEE INC.

  
	
  CASCADES TISSUE GROUP — SALES INC.

  
	
  CASCADES TISSUE GROUP — PICKERING INC.

  
	
  CASCADES TISSUE GROUP — MARYLAND LLC

  
	
  NORAMPAC HOLDING US INC.

  
	
  NORAMPAC NEW YORK CITY INC.

  
	
  NORAMPAC LEOMINSTER INC.

  
	
  NORAMPAC FINANCE US INC.

  
	
  NORAMPAC INDUSTRIES INC.

  
	
  NORAMPAC DELAWARE LLC

  
	
  NORAMPAC NOVA SCOTIA COMPANY

  
	
  NORAMPAC THOMPSON INC.

  
	
  NORAMPAC SCHENECTADY INC.

  
	
  CASCADES TRANSPORT INC.

  
	
  KINGSEY FALLS INVESTMENTS INC.

  
	
  CASCADES ENERGY INITIATIVE INC.

  
	
  CASCADES DELAWARE LLC

  
	
  CASCADES NOVA SCOTIA COMPANY

  
	
  3815285 CANADA INC.

  
	
  3815315 CANADA INC.

  
	
  NORAMPAC INC.

  
	
  CASCADES ENVIROPAC HPM LLC

  
	
  6806813 CANADA INC.

  
	
  6806805 CANADA INC.

  
	
  6806783 CANADA INC.

  

 

each of the foregoing entities being represented by

 

 

	
  Name :

  	
  Robert F. Hall

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  duly authorized as he/they so declare:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (s) Robert F. Hall

  	
   

  

 

16Exhibit 10.6

 

EXECUTION COPY

 

 

FOURTH AMENDMENT

TO THE CREDIT AGREEMENT

dated as of
February 13, 2009

 

Among

 

CASCADES INC.

CASCADES USA INC.

CASCADES EUROPE SAS

(as
Borrowers)

 

— and —

 

SCOTIA CAPITAL

(as Lead
Arranger for the extension

of the Unsecured Revolving Facility)

 

— and —

 

NATIONAL BANK FINANCIAL

(as Lead
Arranger for the amendments

to the financial covenant)

 

 

NATIONAL BANK OF CANADA

THE BANK OF NOVA SCOTIA

(as
Co-Administrative Agents)

 

— and —

 

THE LENDERS

FROM TIME TO TIME PARTY HERETO

 

 

MCCARTHY TÉTRAULT LLP

 

 

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

 

	
  BETWEEN:

  	
   

  	
  CASCADES INC. (“Cascades”)

  
	
   

  	
   

  	
   

  
	
  AND : 

  	
   

  	
  CASCADES USA INC. 

  
	
   

  	
   

  	
   

  
	
  AND :

  	
   

  	
  CASCADES EUROPE SAS

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (each a
  “Borrower” and collectively, the “Borrowers”)

  
	
   

  	
   

  	
   

  
	
  AND:

  	
   

  	
  THE BANK OF NOVA SCOTIA

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (as “Agent”)

  
	
   

  	
   

  	
   

  
	
  AND:

  	
   

  	
  NATIONAL BANK OF CANADA

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (as
  “Co-Agent”)

  

 

RECITALS

 

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

 

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

 

C.                                     The
foregoing request has been agreed on by the Majority Lenders, and the
Borrowers, the Agent and the Co-Agent wish to amend the Credit Agreement to
give effect to the amendments contemplated in the request.

 

NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

 

1.                                      Interpretation

 

1.1                                 Capitalized
terms used herein and defined in the Credit Agreement have the meanings
assigned to them in the Credit Agreement unless otherwise defined herein.

 

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

 

1.3                                 Any
reference to the Credit Agreement in any Credit Document refers to the Credit
Agreement as amended hereby.

 

2

 

2.                                      Amendments to the Credit Agreement

 

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

 

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

 

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

 

“provided
that for the purposes of the calculation of this ratio,

 

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

 

(b)                                 preferred shares redeemable in cash at the option of the issuer with
no possibility of redemption prior to the Revolving Facility Maturity Date and
the Term Facility Maturity Date or convertible in shares of another class at
the option of the issuer or holder thereof may be included in shareholders’
equity (and excluded from Funded Debt) even if they are treated as liabilities
under GAAP.”

 

2.3                                 The
Unsecured Revolving Facility is terminated and cancelled and all provisions of
the Credit Agreement relating thereto are to be read and are amended
accordingly.

 

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

 

“Notwithstanding
Section 1.2(c), Cascades will designate Metro Waste Paper Recovery Inc.
(and may designate any Subsidiary thereof) as a Designated Subsidiary once
Metro Waste Paper Recovery Inc. becomes a Credit Party regardless of the fact
that Metro Waste Paper Recovery Inc. may not be at such time or thereafter a
wholly-owned Subsidiary of Cascades.”

 

2.5                                 Sections
14.1 and 14.2 of the Credit Agreement is deleted and replaced by the following:

 

“14.1       Funded
Debt to Capitalization Ratio

 

Cascades
must maintain at all times, on an adjusted consolidated basis, a Funded Debt to
Capitalization Ratio of not more than 65 %.

 

14.2         Interest
Coverage Ratio

 

Cascades
must maintain at all times, on an adjusted consolidated basis, an Interest
Coverage Ratio not less than 2.25:1.00.”

 

3

 

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

 

3.                                      Effectiveness

 

This
Agreement will become effective on the date hereof.

 

4.                                      Cost and Expenses

 

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

 

4.2                                 The
Borrowers agree to pay on demand all reasonable costs and expenses of the Agent
in connection with the preparation, execution, delivery and implementation and
administration of this Agreement including the reasonable fees and expenses of
counsel for the Agent and the Co-Agent.

 

5.                                      Confirmation

 

5.1                                 Each
of the Borrowers represents to the Agent and the Lenders that the
representations and warranties set forth in the Credit Agreement are still true
and correct in all material respects and that this Agreement (i) has been
duly authorized by all necessary corporate actions, (ii) constitutes a
valid and binding obligation of the Borrowers and (iii) will not result in
any Default or Event of Default.

 

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

 

6.                                      Counterparts

 

This
Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed and
delivered will be deemed to be an original and all of which taken together will
constitute but one and the same agreement. Delivery of an executed counterpart
of a signature page to this Agreement by telecopier or by electronic
mail will be effective as delivery of a manually executed counterpart of this
Agreement.

 

4

 

7.                                      Governing Law

 

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

 

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

 

 

	
   

  	
   

  	
  Cascades Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (s) Robert
  F. Hall

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Cascades USA Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (s) Robert
  F. Hall

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Cascades Europe SAS

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  
	
   

  	
   

  	
   

  	
  (s) Robert
  F. Hall

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Bank of Nova Scotia, as Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  
	
   

  	
   

  	
   

  	
  (s) Robert
  Boomhour 

  
	
   

  	
   

  	
   

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  National Bank of Canada, as Co-Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  
	
   

  	
   

  	
   

  	
  (s) Dominic
  Albanese 

  
	
   

  	
   

  	
   

  	
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  per:

  
	
   

  	
   

  	
   

  	
  (s) Roch
  Ledoux 

  
	
   

  	
   

  	
   

  	
  Director

  

 

5

 

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

 

CASCADES BOXBOARD U.S., INC.

CASCADES CANADA INC. 

CASCADES PAPERBOARD INTERNATIONAL INC.

6265642 CANADA INC.

SCIERIE LEMAY INC.

RABOTAGE LEMAY INC.

DOPACO, INC.

DOPACO PACIFIC LLC

DOPACO LIMITED PARTNERSHIP

DOPACO CANADA, INC.

GARVEN INCORPORATED

CONFERENCE CUP LTD.

CASCADES BOXBOARD GROUP — CONNECTICUT LLC

CASCADES AUBURN FIBER INC.

CASCADES MOULDED PULP, INC.

CASCADES PLASTICS INC.

CASCADES FINE PAPERS GROUP INC.

CASCADES FINE PAPERS GROUP (SALES) INC.

CASCADES FINE PAPERS GROUP (USA) INC.

W.H. SMITH PAPER CORPORATION 

CASCADES TISSUE GROUP — ARIZONA INC.

CASCADES TISSUE GROUP — IFC DISPOSABLES INC.

CASCADES TISSUE GROUP — NEW YORK INC.

CASCADES TISSUE GROUP — NORTH CAROLINA INC.

CASCADES TISSUE GROUP — OREGON INC.

CASCADES TISSUE GROUP — PENNSYLVANIA INC.

CASCADES TISSUE GROUP — WISCONSIN INC.

CASCADES TISSUE GROUP — TENNESSEE INC.

CASCADES TISSUE GROUP — SALES INC.

CASCADES TISSUE GROUP — PICKERING INC.

CASCADES TISSUE GROUP — MARYLAND LLC

NORAMPAC HOLDING US INC.

NORAMPAC NEW YORK CITY INC.

NORAMPAC LEOMINSTER INC.

NORAMPAC FINANCE US INC.

NORAMPAC INDUSTRIES INC.

NORAMPAC DELAWARE LLC

 

6

 

NORAMPAC THOMPSON INC.

NORAMPAC SCHENECTADY INC.

CASCADES TRANSPORT INC.

KINGSEY FALLS INVESTMENTS INC.

CASCADES ENERGY INITIATIVE INC.

CASCADES DELAWARE LLC

NORAMPAC INC.

CASCADES ENVIROPAC HPM LLC

6806813 CANADA INC.

6806805 CANADA INC.

6806783 CANADA INC.

 

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

 

	
  (s) Robert
  F. Hall

  	
   

  

 

7

 

A N N E X

 

APPLICABLE MARGINS OR RATES

 

Revolving
Facility

 

	
  Rating

  	
   

  	
  Prime, US Base

  	
   

  	
  Acceptance Fee / Libor 

  European Rate/L/C Fee

  	
   

  	
  Stand-By Fee

  
	
  BBB/Baa2 or Higher

  	
   

  	
  165 bps

  	
   

  	
  265 bps

  	
   

  	
  65 bps

  
	
  BBB-/Baa3

  	
   

  	
  175 bps

  	
   

  	
  275 bps

  	
   

  	
  70 bps

  
	
  BB+/Bal

  	
   

  	
  195 bps

  	
   

  	
  295 bps

  	
   

  	
  75 bps

  
	
  BB/Ba2

  	
   

  	
  225 bps

  	
   

  	
  325 bps

  	
   

  	
  80 bps

  
	
  BB-/Ba3 or Lower

  	
   

  	
  250 bps

  	
   

  	
  350 bps

  	
   

  	
  87.5 bps

  

 

Term
Loan

 

	
  Rating

  	
   

  	
  Prime, US Base

  	
   

  	
  Acceptance Fee / Libor

  
	
  BBB-/Baa3 or Higher

  	
   

  	
  187.5 bps

  	
   

  	
  287.5 bps

  
	
  BB+/Bal

  	
   

  	
  207.5 bps

  	
   

  	
  307.5 bps

  
	
  BB/Ba2

  	
   

  	
  237.5 bps

  	
   

  	
  337.5 bps

  
	
  BB-/Ba3 or Lower

  	
   

  	
  262.5 bps

  	
   

  	
  362.5 bps

  

 

8

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