THIRD AMENDMENT AND WAIVER

Exhibit 10.1

E XECUTION C OPY

THIRD AMENDMENT AND WAIVER

This Third Amendment and Waiver (the “ Agreement ”) to the Credit Agreement referred to below is dated as of February 25, 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 (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, 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 . 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).

2. Waiver . Pursuant to Section 13.2 of the Credit Agreement and subject to the terms and conditions hereof, including, without limitation, the conditions to effectiveness set forth in Section 4 hereof, each of the Administrative Agent, the Issuing Lender and the other Consenting Lenders party hereto waive any and all Defaults or Events of Default occurring pursuant to Section 11.1(d) of the Credit Agreement solely as a result of the failure by the Borrower and its Subsidiaries to comply with the financial covenants set forth in Sections 9.1 and 9.2 of the Credit Agreement solely with respect to the testing period ended December 31, 2007.

3. Credit Agreement Amendments . The Credit Agreement is hereby amended as set forth on Exhibit B ; provided , that the Administrative Agent (in consultation with the Lenders and the Canadian Lenders) may effect such other amendments to the Credit Agreement as may be necessary or appropriate, in the opinion of the Administrative Agent (in consultation with the Lenders and the Canadian Lenders), to reflect changes in the structure of the Newco Transactions from the structure described in the Credit Agreement so long as (a) any such new structure has substantially the same economic end result as the structure described in the Credit Agreement and (b) any such changes are limited to changes that are not materially adverse to the Lenders or the Canadian Lenders.

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:

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(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 (including, without limitation, the fees set forth in that certain letter agreement dated as of February 7, 2008 (as amended, restated, supplemented or otherwise modified) between Wachovia Capital Markets, LLC and the Borrower) 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 and the Canadian Administrative Agent shall have received Schedule 1.1(c) to the Credit Agreement and Schedule 1.1(c) to the Canadian Credit Agreement, in each case, in form and substance reasonably satisfactory to the Administrative Agent and the Canadian Administrative Agent;

(e) 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);

(f) the Borrower shall have paid to the Administrative Agent (or its applicable affiliates), for the account of each Consenting Lender (including the Administrative Agent and the Canadian Administrative Agent) that executes and delivers this Agreement or a Lender Authorization to the Administrative Agent (or its counsel) on or prior to 2:00 p.m. (Eastern Time) on February 22, 2008, an amendment fee in an amount equal to (a) 25 basis points times the principal amount of such Consenting Lender’s Commitment plus (b) 25 basis points times the principal amount of such Consenting Lender’s “Commitment” (as defined in the Canadian Credit Agreement); and

(g) 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.

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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 Borrower and each Subsidiary Grantor hereby certifies, represents and warrants to the Administrative Agent and the Lenders that after giving effect to the waiver set forth in Section 2 above and the amendments set forth in Section 3 above, each of the representations and warranties set forth in the Credit Agreement and the other Loan Documents is true and correct in all material respects as of the date hereof (except to the extent that (A) any such representation or warranty that is qualified by materiality or by reference to Material Adverse Effect, in which case such representation or warranty is true and correct in all respects as of the date hereof or (B) any such representation or warranty relates only to an earlier date, in which case such representation or warranty shall remain true and correct as of such earlier date) and that no Default or Event of Default has occurred or is continuing;

(b) the Borrower, the Parent and each of the Subsidiary Grantors hereby certifies, represents and warrants to the Administrative Agent and the Lenders that:

(i) it has the right, power and authority and has taken all necessary corporate and other action to authorize the execution, delivery and performance of this Agreement and each of the other documents executed in connection herewith to which it is a party in accordance with their respective terms and the transactions contemplated hereby; and

(ii) this Agreement and each other document executed in connection herewith has been duly executed and delivered by the duly authorized officers of the 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. 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 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 Subsidiary Guaranty Agreement, the Collateral Agreement and each other Security Document to which it is a party and (c) agrees that 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. In furtherance of the reaffirmations set forth in this Section 7 , each Credit Party hereby grants to the Administrative Agent, for the ratable benefit of the Secured Parties, a security interest in, all Collateral and all proceeds thereof as security for the Obligations, in each case subject to any applicable terms and conditions set forth in the Subsidiary Guaranty Agreement, the Collateral Agreement and each other Security Document to which it is a party.

8. 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) , 8.10(e)(i) , 10.6(i) and 11.1(o) ).

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9. 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.

10. Counterparts . This Agreement may be executed by one or more of the parties hereto in any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same instrument.

11. Electronic Transmission . A facsimile, telecopy, pdf or other reproduction of this Agreement may be executed by one or more parties hereto, and an executed copy of this Agreement may be delivered by one or more parties hereto by facsimile or similar instantaneous electronic transmission device pursuant to which the signature of or on behalf of such party can be seen, and such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any party hereto, all parties hereto agree to execute an original of this Agreement as well as any facsimile, telecopy, pdf or other reproduction hereof.

12. Agreement Regarding Intercompany Subordination Agreement . The Intercompany Subordination Agreement is hereby amended by:

(a) adding the phrase “(other than the U.S. Borrower)” after the reference to “Canadian Credit Party” in the definition of “Demand Indebtedness”; and

(b) adding the phrase “(other than the U.S. Borrower)” after each reference to the “Canadian Credit Party” in Section 2.05(a) and (b).

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

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[Third Amendment and Waiver – Bowater]

LENDER AUTHORIZATION

Bowater Incorporated

Bowater Canadian Forest Products Inc.

Third Amendment and Waiver

February 25, 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, 62 ^nd Floor

Toronto, Ontario M5W 2X6

Attention: Corporate Banking Loan Syndication

This Lender Authorization acknowledges our receipt and review of the execution copy of the Agreements, each in the form posted on SyndTrak Online or otherwise distributed to us by the U.S. Administrative Agent or the Canadian Administrative Agent. By executing this Lender Authorization, we hereby approve the Agreements and authorize the U.S. Administrative Agent or the Canadian Administrative Agent (as applicable) to execute and deliver the Agreements on our behalf.

Each financial institution purporting to be a U.S. Lender and executing this Lender Authorization agrees or reaffirms that it shall be a party to the Agreements and the other Loan Documents (as defined in the U.S. Credit Agreement) to which U.S. Lenders are parties and shall have the rights and obligations of a “Lender” (as defined in the U.S. Credit Agreement), and agrees to be bound by the terms and provisions applicable to a “Lender” under each such agreement. Each financial institution purporting to be a Canadian Lender and executing this Lender Authorization agrees or reaffirms that it shall be a party to the Agreements and the other Loan Documents (as defined in the Canadian Credit Agreement) to which Canadian Lenders are parties and shall have the rights and obligations of a “Lender” (as defined in the Canadian Credit Agreement), and agrees to be bound by the terms and provisions applicable to a “Lender” under each such agreement. In furtherance of the foregoing, each financial institution executing this Lender Authorization agrees to execute any additional documents reasonably requested by the U.S. Administrative Agent or the Canadian Administrative Agent, as applicable, to evidence such financial

institution’s rights and obligations under the U.S. Credit Agreement or the Canadian Credit Agreement, as applicable.

A facsimile, telecopy, pdf or other reproduction of this Lender Authorization may be executed by one or more parties hereto, and an executed copy of this Lender Authorization may be delivered by one or more parties hereto by facsimile or similar instantaneous electronic transmission device pursuant to which the signature of or on behalf of such party can be seen, and such execution and delivery shall be considered valid, binding and effective for all purposes.

Exhibit B

E XECUTION C OPY

Published CUSIP Number: 10218JAA3

Revolving Credit CUSIP Number: 10218JAB1

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 and

that certain Third Amendment and Waiver dated as of February 25, 2008)

by and among

BOWATER INCORPORATED,

as Borrower,

the Lenders referred to herein,

WACHOVIA BANK, NATIONAL ASSOCIATION,

as Administrative Agent,

Swingline Lender and Issuing Lender,

JPMORGAN CHASE BANK, N.A. and UBS SECURITIES LLC ,

each as a Syndication Agent,

and

WELLS FARGO FOOTHILL, LLC

as Documentation Agent

WACHOVIA CAPITAL MARKETS, LLC,

as Sole Book Manager

WACHOVIA CAPITAL MARKETS, LLC,

as Lead Arranger

Table of Contents

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CREDIT AGREEMENT, dated as of May 31, 2006, by and among BOWATER INCORPORATED, a Delaware corporation (the “ Original Borrower ”), together with each additional borrower that becomes a party hereto pursuant to the terms hereof, as borrower, the lenders who are party to this Agreement or who may become a party to this Agreement pursuant to Section 13.10 hereof, as Lenders, and WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association, as Administrative Agent for the Lenders.

STATEMENT OF PURPOSE

The Borrower has requested, and the Lenders have agreed, to extend certain credit facilities to the Borrower on the terms and conditions of this Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, such parties hereby agree as follows:

ARTICLE I

DEFINITIONS

SECTION 1.1 Definitions . The following terms when used in this Agreement shall have the meanings assigned to them below:

“ Abitibi Entities ” means, collectively, Abitibi-Consolidated Inc. and its Subsidiaries.

“ Additional Newco Indebtedness ” has the meaning assigned thereto in Section 10.1(m)(ii) .

“ Administrative Agent ” means Wachovia, in its capacity as Administrative Agent hereunder, and any successor thereto appointed pursuant to Section 12.6 .

“ Administrative Agent’s Office ” means the office of the Administrative Agent specified in or determined in accordance with the provisions of Section 13.1(c) .

“ Administrative Questionnaire ” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

“ Affiliate ” means, with respect to any Person, any other Person which directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such first Person or any of its Subsidiaries. As used in this definition, the term “control” means (a) the power to vote ten percent (10%) or more of the securities or other equity interests of a Person having ordinary voting power (excluding, however, a Person or group whose ownership in another Person is permitted to be reported on Schedule 13G pursuant to Rule 13d-1(b) under the Securities Exchange Act of 1934, as amended) or (b) the possession, directly or indirectly, of any other power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract or otherwise. Notwithstanding the foregoing, (i) no individual shall be an Affiliate of the Borrower or any of its Subsidiaries solely and exclusively by reason of his or her being a director, officer or employee of the Borrower or any of its Subsidiaries, (ii) none of the Subsidiaries of the Borrower

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shall be Affiliates of the Borrower or any of its Subsidiaries and (iii) no Borrower shall be an Affiliate of any other Borrower; provided , that the Abitibi Entities shall be Affiliates of the Borrower and its Subsidiaries for the purposes of this Agreement and the other Loan Documents and the Canadian Credit Agreement and the “Loan Documents” (as defined in the Canadian Credit Agreement).

“ Aggregate Credit Exposure ” means the sum of (a) the aggregate amount of outstanding Loans and (b) the aggregate amount of outstanding Canadian Loans.

“ Agreement ” means this Credit Agreement, as amended by (a) the First Amendment dated as of July 20, 2007 by and among the Original Borrower, the Subsidiary Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto), (b) the Second Amendment dated as of October 31, 2007 by and among the Original Borrower, the Subsidiary Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto) and (c) the Third Amendment and as further amended, restated, supplemented or otherwise modified from time to time.

“ Applicable Insolvency Laws ” means all Applicable Laws governing bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C. Sections 544, 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United States Code, as amended or supplemented).

“ Applicable Law ” means all applicable provisions of constitutions, laws, statutes, ordinances, rules, treaties, regulations, permits, licenses, approvals, legally binding policies, interpretations and orders of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators.

“ Applicable Margin ” means the corresponding percentages per annum as set forth below based on the Average Utilization:

The Applicable Margin shall be determined by the Administrative Agent and adjusted quarterly on the date (each a “ Calculation Date ”) ten (10) Business Days after the end of each fiscal quarter of the Borrower; provided that the Applicable Margin shall be based on Pricing Level I until the first Calculation Date occurring after the Third Amendment Effective Date and, thereafter the Pricing Level shall be determined by reference to the Average Utilization Percentage as of the last day of the most recently ended fiscal quarter of the Borrower preceding the applicable Calculation Date. The Applicable Margin shall be effective from one Calculation

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Date until the next Calculation Date. Any adjustment in the Applicable Margin shall be applicable to all Extensions of Credit then existing or subsequently made or issued.

“ Approved Fund ” means any Person (other than a natural Person), including, without limitation, any special purpose entity, that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business; provided , that such Approved Fund must be administered, managed or underwritten by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“ Asset Coverage Amount ” means, as of any date of determination, an amount equal to eighty-five percent (85%) of the net book value of the Coverage Assets as set forth on the Consolidated balance sheet of the Borrower and its Consolidated Subsidiaries most recently delivered pursuant to Sections 5.2 or 7.1 hereof; provided, however that such percentage shall be reduced to seventy-five percent (75%) during the period from October 1, 2007 through and including September 30, 2008.

“ Asset Disposition ” means the disposition of any or all of the assets (including, without limitation, any Capital Stock owned thereby) of the Borrower or any of its Subsidiaries whether by sale, lease, transfer or otherwise. The term “Asset Disposition” shall not include any Insurance and Condemnation Event.

“ Assignment and Assumption ” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 13.10 ), and accepted by the Administrative Agent, in substantially the form of Exhibit G or any other form approved by the Administrative Agent.

“ Attributable Indebtedness ” means, on any date, (a) in respect of any Capital Lease of any Person, the capitalized amount thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease, the capitalized amount or principal amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease.

“ Average Utilization ” means, for any calendar quarter, the average daily principal balance of Loans outstanding during such calendar quarter.

“ Base Rate ” means, at any time, the higher of (a) the Prime Rate and (b) the Federal Funds Rate plus 1/2 of 1%; each change in the Base Rate shall take effect simultaneously with the corresponding change or changes in the Prime Rate or the Federal Funds Rate.

“ Base Rate Loan ” means any Loan bearing interest at a rate based upon the Base Rate as provided in Section 4.1(a) .

“ BCFC Notes ” means the 7.95% Notes due 2011 issued pursuant to the Indenture dated as of October 31, 2001 among Bowater Canada Finance Corporation, as Issuer, the Original Borrower, as Guarantor, and The Bank of New York, as Trustee.

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“ Borrower ” means (a) prior to the receipt by the Administrative Agent of all documentation required to be delivered pursuant to Sections 8.10(e)(i) and (ii)(A) , the Original Borrower and (b) upon receipt by the Administrative Agent of all documentation required to be delivered pursuant to Sections 8.10(e)(i) and (ii)(A) , collectively, the Original Borrower and Newco.

“ Borrowing Limit ” means, at any time, the lesser of:

(a) the aggregate principal amount of the Commitments at such time less , except with respect to Sections 2.4(b) and 5.2(e)(iii) ,

(i) in the case of any request for Revolving Credit Loans, the sum of all outstanding Swingline Loans and L/C Obligations;

(ii) in the case of any request for Swingline Loans, the sum of all outstanding Revolving Credit Loans and L/C Obligations; or

(iii) in the case of any request for issuance of a Letter of Credit, the sum of all outstanding Loans; and

(b) the amount which, when aggregated with the aggregate amount of all other Consolidated Total Senior Secured Indebtedness, does not exceed the Asset Coverage Amount.

“ Bowater-Calhoun Arrangement ” means that certain intercompany loan arrangement pursuant to which:

(a) the Original Borrower loaned $33,294,000 of proceeds of the McMinn County pollution control bonds to Calhoun Newsprint Company as evidenced by an intercompany note payable to the Original Borrower; and

(b) Calhoun Newsprint Company loaned such proceeds back to the Original Borrower as evidenced by an intercompany note payable to Calhoun Newsprint Company and secured by the Original Borrower’s intercompany note receivable referred to in clause (a).

“ Business Day ” means (a) for all purposes other than as set forth in clause (b) below, any day other than a Saturday, Sunday or legal holiday on which banks in Charlotte, North Carolina, New York, New York and Toronto, Ontario, are open for the conduct of their commercial banking business, and (b) with respect to all notices and determinations in connection with, and payments of principal and interest on, any LIBOR Rate Loan, any day that is a Business Day described in clause (a) and that is also a day for trading by and between banks in Dollar deposits in the London interbank market.

“ Calculation Date ” has the meaning assigned thereto in the definition of Applicable Margin.

“ Canadian Administrative Agent ” means The Bank of Nova Scotia in its capacity as the administrative agent under the Canadian Credit Agreement.

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“ Canadian Borrower ” means Bowater Canadian Forest Products Inc., as borrower under the Canadian Credit Facility.

“ Canadian Collateral ” means the “Collateral” as defined in the Canadian Credit Agreement.

“ Canadian Credit Agreement ” means that certain credit agreement dated as of even date herewith by and among the Canadian Borrower, as borrower, the Original Borrower, as guarantor, the lenders party thereto, as lenders, and The Bank of Nova Scotia, as administrative agent.

“ Canadian Credit Facility ” means that certain revolving credit facility established pursuant to the Canadian Credit Agreement.

“ Canadian Credit Party ” means the Canadian Borrower and each Canadian Guarantor.

“ Canadian Employee Benefit Plan ” means (a) any employee benefit plan that is maintained for the benefit of employees or former employees of the Canadian Borrower or any of the Canadian Subsidiaries registered in accordance with the ITA or other Applicable Law which the Borrower or any of its Subsidiaries sponsors, maintains, or to which it makes, is making, or is obligated to make, contributions or (b) any Canadian Pension Plan or Canadian Multiemployer Plan that has at any time within the preceding six (6) years been maintained for the employees of the Borrower or any of its Subsidiaries, and shall not include any Employee Benefit Plan.

“ Canadian Extensions of Credit ” means the “Extensions of Credit” as defined in the Canadian Credit Agreement.

“ Canadian Guarantors ” means the “Guarantors” as defined in the Canadian Credit Agreement.

“ Canadian Lender ” means any “Lender” as defined in the Canadian Credit Agreement.

“ Canadian Loans ” means “Loans” as defined in the Canadian Credit Agreement.

“ Canadian Multiemployer Plan ” means a “multi-employer pension plan” as defined by Applicable Laws and registered in accordance with the ITA or other Applicable Laws and as to which the Borrower or any of its Subsidiaries is making, or is accruing an obligation to make, or has accrued an obligation to make, contributions within the preceding six (6) years, and shall not include any Multiemployer Plan.

“ Canadian Obligations ” means the “Obligations” as defined in the Canadian Credit Agreement.

“ Canadian Pension Plan ” means any Canadian Employee Benefit Plan, other than a Canadian Multiemployer Plan, which is registered in accordance with the ITA or other Applicable Law and which (a) is maintained for the employees of the Borrower or any of its Subsidiaries or (b) has at any time within the preceding six (6) years been maintained for the

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employees of the Borrower or any of its Subsidiaries which the Borrower or any of its Subsidiaries sponsors, maintains, or to which it makes, is making or is obligated to make, contributions, and shall not include any Pension Plan.

“ Canadian Required Agreement Lenders ” means the “Required Agreement Lenders” as defined in the Canadian Credit Agreement.

“ Canadian Secured Parties ” means the “Secured Parties” as defined in the Canadian Credit Agreement.

“ Canadian Subsidiary ” means any Subsidiary that is organized under the laws of Canada or any province or political subdivision thereof.

“ Capital Asset ” means, with respect to the Borrower and its Subsidiaries, any asset that should, in accordance with GAAP, be classified and accounted for as a capital asset on a Consolidated balance sheet of the Borrower and its Subsidiaries.

“ Capital Expenditures ” means, with respect to the Borrower and its Subsidiaries for any period, the aggregate cost of all Capital Assets acquired by the Borrower and its Subsidiaries during such period, as determined in accordance with GAAP.

“ Capital Lease ” means any lease of any property by the Borrower or any of its Subsidiaries, as lessee, that should, in accordance with GAAP, be classified and accounted for as a capital lease on a Consolidated balance sheet of the Borrower and its Subsidiaries.

“ Capital Stock ” means (a) in the case of a corporation, capital stock, (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock, (c) in the case of a partnership, partnership interests (whether general or limited), (d) in the case of a limited liability company, membership interests and (e) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

“ Cash Equivalents ” means, collectively:

(a) marketable obligations issued or unconditionally guaranteed by the United States, Canada or any agency thereof maturing within two hundred seventy (270) days from the date of acquisition thereof;

(b) commercial paper maturing no more than two hundred seventy (270) days from the date of creation thereof and currently having the highest rating obtainable from either S&P, Moody’s or DBRS;

(c) certificates of deposit, time deposits and bankers’ acceptances maturing no more than two hundred seventy (270) days from the date of creation thereof issued by commercial banks incorporated under the laws of the United States or Canada, each having combined capital, surplus and undivided profits of not less than $500,000,000 and having a rating of “A” or better by a nationally recognized rating agency; provided that the aggregate amount invested in such certificates of deposit shall not at any time exceed

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$5,000,000 for any one such certificate of deposit and $10,000,000 for any one such bank;

(d) repurchase obligations for underlying securities of the types described in, and satisfying the requirements specified in, clauses (a) and (c) above entered into with any bank satisfying the requirements specified in clause (c) above;

(e) demand deposit accounts maintained in the ordinary course of business; and

(f) (i) money market mutual or similar funds which (A) invest solely in assets of the types described in clauses (a) through (e) above, without regard to the limitations as to the maturity of such obligations, bankers’ acceptances, time deposits, certificates of deposit, repurchase agreements or commercial paper set forth above, (B) are rated at least “AAm” or “AAmg” or their equivalent by both S&P and Moody’s, provided that there is no “r-highlighter” affixed to such rating and (C) comply with Rule 2a-7 of the Investment Company Act of 1940, as amended; and

(ii) the money market fund called Columbia Cash Reserves, so long as Columbia Cash Reserves continues to buy only “first tier” securities as defined by Rule 2a-7 of the Investment Company Act of 1940, as amended.

“ Catawba Mill Assets ” means, collectively, (a) that certain mill owned as of the Third Amendment Effective Date by the Original Borrower and located in Catawba, South Carolina (the “ Catawba Mill ”), along with the real property upon which the Catawba Mill is situated (as more particularly described on Schedule 1.1(c) hereto, the “ Catawba Mill Real Property ”), (b) all equipment used in connection therewith and located at the Catawba Mill Real Property (the “ Catawba Mill Equipment ”), (c) all other rights and assets used for the operation, administration and maintenance of the Catawba Mill Real Property and (d) all operations thereof.

“ Catawba Mortgage ” means that certain mortgage, deed of trust, security agreement or other real property security document encumbering the Newco Fixed Assets, in form and substance reasonably satisfactory to the Administrative Agent and the Canadian Administrative Agent and executed by Newco 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.

“ Catawba Note ” has the meaning assigned thereto in Section 10.5(h) .

“ Change in Control ” means an event or series of events by which (a) any person or group of persons (within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended) shall obtain ownership or control in one or more series of transactions of more than thirty-five percent (35%) of the Capital Stock or thirty-five percent (35%) of the voting power of the Parent entitled to vote in the election of members of the board of directors of the Parent, (b) during any period of twenty-five (25) consecutive calendar months, a majority of the members of the board of directors of the Parent cease to be composed of Continuing Directors, (c) there shall have occurred under any indenture or other instrument evidencing any Indebtedness of the Borrower or any of its Subsidiaries in excess of $25,000,000 any “change in control” or similar

7

provision (as set forth in the indenture, agreement or other evidence of such Indebtedness) obligating the Borrower or any of its Subsidiaries to repurchase, redeem or repay all or any part of such Indebtedness or Capital Stock provided for therein ( provided that if such obligation is contingent on any other event or circumstance, then such “change in control” shall not constitute a Change in Control hereunder unless such other event or circumstance also has occurred or exists), (d) the Parent shall cease to own one hundred percent (100%) of the Capital Stock of the Original Borrower or (e) after the receipt of the documentation required pursuant to Section 8.10(e)(ii)(A)(1) , the Parent shall cease to own one hundred percent (100%) of the Capital Stock of Newco.

For the purposes hereof, “Continuing Directors” means, during any period of twenty-five (25) consecutive calendar months, individuals (i) who were members of the board of directors on the first day of such period, (ii) whose election or nomination to the board of directors was approved by individuals who comprised a majority of the board of directors on the first day of such period or (iii) whose election or nomination to the board of directors was approved by (A) individuals who were members of the board of directors on the first day of such period or (B) individuals whose election or nomination to the board of directors was approved by a majority of the board of directors on the first day of such period; provided that in each case such individuals referenced in clause (A) and clause (B) constituted a majority of the board of directors at the time of such election or nomination.

“ Change in Law ” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority.

“ Closing Date ” means the date of this Agreement or such later Business Day upon which each condition described in Section 5.2 shall be satisfied or waived in all respects in a manner acceptable to the Administrative Agent, in its sole discretion.

“ Code ” means the Internal Revenue Code of 1986, and the rules and regulations thereunder, each as amended or modified from time to time.

“ Collateral ” means the collateral security for the Obligations and/or the Canadian Obligations (as the case may be) pledged or granted pursuant to the Security Documents.

“ Collateral Agreement ” means the collateral agreement of even date executed by the Credit Parties in favor of the Administrative Agent, for the benefit of itself and the other Secured Parties, substantially in the form of Exhibit I , as amended, restated, supplemented or otherwise modified from time to time.

“ Combination ” means the combination of the Original Borrower with Abitibi-Consolidated Inc., with the Parent as a common holding company, pursuant to the terms of the Combination Agreement.

8

“ Combination Agreement ” means that certain Combination Agreement and Agreement and Plan of Merger dated as of January 29, 2007 among the Parent, Abitibi-Consolidated Inc., the Original Borrower, Alpha-Bravo Merger Sub Inc., a Delaware corporation, and Bowater Canada, Inc., as the same may be amended, modified or supplemented from time to time.

“ Commitment ” means (a) as to any Lender, the obligation of such Lender to make Extensions of Credit to the Borrower hereunder in an aggregate principal amount at any time outstanding not to exceed the amount set forth opposite such Lender’s name on the Register, as such amount may be modified at any time or from time to time pursuant to the terms hereof and (b) as to all Lenders, the aggregate commitment of all Lenders to make Extensions of Credit, as such amount may be modified at any time or from time to time pursuant to the terms hereof. The Commitment of all the Lenders on the Closing Date shall be $415,000,000.

“ Commitment Percentage ” means, as to any Lender at any time, the ratio of (a) the amount of the Commitment of such Lender to (b) the Commitments of all the Lenders.

“ Consolidated ” means, when used with reference to financial statements or financial statement items of any Person, such statements or items on a consolidated basis in accordance with applicable principles of consolidation under GAAP; provided , however, that upon receipt by the Administrative Agent of all documentation required to be delivered pursuant to Sections 8.10(e)(i) and (ii)(A) , when used with respect to the Borrower, “Consolidated” shall include the Original Borrower and its Subsidiaries (other than the Abitibi Entities) combined with Newco and its Subsidiaries (if any).

“ Consolidated Adjusted EBITDA ” means, for any period, the sum for the Borrower and its Consolidated Subsidiaries (determined on a Consolidated basis, without duplication, in accordance with GAAP) of the following: (a) Consolidated EBITDA for such period plus (b) any net gain on any Asset Disposition during such period minus (c) any net loss on any Asset Disposition during such period; provided that, for purposes of this Agreement, Consolidated Adjusted EBITDA shall be adjusted on a pro forma basis, in a manner consistent with Regulation S-X of the SEC or otherwise reasonably acceptable to the Administrative Agent, to include or exclude, as applicable, as of the first day of any applicable period, (A) any Permitted Acquisition closed during such period or (B) any permitted Asset Disposition closed during such period (other than Asset Dispositions permitted pursuant to Section 10.5(a)-(i) ) of assets having an aggregate fair market value (at the time of the closing of such Asset Disposition) in excess of $50,000,000.

“ Consolidated EBITDA ” means, for any period, the sum for the Borrower and its Consolidated Subsidiaries (determined on a Consolidated basis, without duplication, in accordance with GAAP) of the following:

(a) Consolidated Net Income for such period,

plus

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

9

(i) income taxes for such period (or minus , to the extent added in determining Consolidated Net Income for such period, income tax benefit for such period);

(ii) amortization, depreciation, depletion and other non-cash charges for such period;

(iii) Consolidated Interest Expense for such period;

(iv) any extraordinary charges for such period;

(v) any unusual or non-recurring charges for such period up to an amount not to exceed five percent (5%) of the Consolidated EBITDA of the Borrower and its Subsidiaries (as calculated without giving effect to this clause (v) or clause (vi) below);

(vi) any cost savings and synergies associated with a Permitted Acquisition not to exceed five percent (5%) of the Consolidated EBITDA of the Borrower and its Subsidiaries (as calculated without giving effect to this clause (vi) or clause (v) above); and

(vii) any net loss on any Asset Disposition during such period,

less

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

(i) the aggregate amount of interest income for such period;

(ii) any extraordinary gains during such period;

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

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

provided that, for purposes of this Agreement, Consolidated EBITDA shall be adjusted on a pro form a basis, in a manner consistent with Regulation S-X of the SEC or otherwise reasonably acceptable to the Administrative Agent and the Canadian Administrative Agent, to include or exclude, as applicable, as of the first day of any applicable period, (A) any Permitted Acquisition closed during such period or (B) any permitted Asset Disposition closed during such period (other than Asset Dispositions permitted pursuant to Section 10.5(a)-(i) ) of assets having an aggregate fair market value (at the time of the closing of such Asset Disposition) in excess of $50,000,000.

“ Consolidated Interest Expense ” means, with respect to the Borrower and its Consolidated Subsidiaries for any period, (a) the gross interest expense (including, without limitation, interest expense attributable to Capital Leases and plus the net amount payable (or minus the net amount receivable) under any Interest Rate Contracts of the Borrower and its

10

Consolidated Subsidiaries), plus (b) the aggregate amount of all cash distributions or dividends paid by the Borrower and its Consolidated Subsidiaries to the Parent pursuant to, and in accordance with, Section 10.6(j) , all determined for such period on a Consolidated basis without duplication, in accordance with GAAP.

“ Consolidated Net Income ” means, with respect to the Borrower and its Consolidated Subsidiaries, for any period of determination, the net income (or loss) of the Borrower and its Consolidated Subsidiaries for such period, determined on a Consolidated basis in accordance with GAAP.

“ Consolidated Senior Secured Leverage Ratio ” means, as of any date of determination, the ratio of (a) Consolidated Total Senior Secured Indebtedness on such date to (b) the sum, without duplication, of (i) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date plus (ii) the amount of Specified Non-Recurring Charges taken during the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date.

“ Consolidated Subsidiary ” means, for any Person, each Subsidiary of such Person (whether now existing or hereafter created or acquired) the financial statements of which shall be (or should have been) consolidated with the financial statements of such Person in accordance with GAAP.

“ Consolidated Total Indebtedness ” means, as of any date of determination, without duplication, all Indebtedness (excluding clause (h) of the definition thereof) of the Borrower and its Consolidated Subsidiaries.

“ Consolidated Total Leverage Ratio ” means, as of any date of determination, the ratio of (a) Consolidated Total Indebtedness on such date to (b) Consolidated EBITDA for the period of four (4) consecutive fiscal quarters ending on or immediately prior to such date.

“ Consolidated Total Senior Secured Indebtedness ” means,

(a) for purposes of determining the Consolidated Senior Secured Leverage Ratio, as of any date of determination with respect to the Borrower and its Consolidated Subsidiaries on a Consolidated basis, without duplication, the sum of (i) all outstanding Extensions of Credit (including, without limitation, each outstanding Letter of Credit and each outstanding Swingline Loan) under the Credit Facility plus (ii) all outstanding Canadian Extensions of Credit (including, without limitation, each outstanding letter of credit and each outstanding swingline loan) plus (iii) all other outstanding Indebtedness of the Borrower and its Consolidated Subsidiaries which is secured by any assets of the Borrower and its Consolidated Subsidiaries other than (A) any Hedging Agreement and (B) any such Indebtedness that is secured by a Lien or Liens (1) permitted pursuant to Section 10.2(k) or (2) that is or are junior in priority to the Liens in favor of the Administrative Agent securing the Obligations and/or the Canadian Obligations; and

(b) for all other purposes, as of any date of determination with respect to the Borrower and its Consolidated Subsidiaries on a Consolidated basis, without duplication, the sum of (i) all outstanding Extensions of Credit (including, without limitation, each

11

outstanding Letter of Credit and each outstanding Swingline Loan) under the Credit Facility plus (ii) all other outstanding Indebtedness (other than any Hedging Agreement) of the Borrower and its Consolidated Subsidiaries which is secured by a Lien on the Coverage Assets.

“ Coverage Assets ” means all accounts receivable (excluding any intercompany accounts receivable) and all inventory of the Borrower and its Consolidated Subsidiaries other than accounts receivable and inventory of the Canadian Borrower or any Consolidated Subsidiary of the Canadian Borrower.

“ Credit Facility ” means, collectively, the Revolving Credit Facility, the Swingline Facility and the L/C Facility.

“ Credit Parties ” means, collectively, the Borrower and the Subsidiary Guarantors.

“ DBRS ” means Dominion Bond Rating Service Limited and any successor thereto.

“ Default ” means any of the events specified in Section 11.1 which with the passage of time, the giving of notice or any other condition, would constitute an Event of Default.

“ Defaulting Lender ” means any Lender that (a) has failed to fund any portion of the Revolving Credit Loans, participations in L/C Obligations or participations in Swingline Loans required to be funded by it hereunder within one (1) Business Day of the date required to be funded by it hereunder, (b) has otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within one (1) Business Day of the date when due, unless such amount is the subject of a good faith dispute, or (c) has been deemed insolvent or become the subject of a bankruptcy, receivership or insolvency proceeding.

“ Disputes ” means any dispute, claim or controversy arising out of, connected with or relating to this Agreement or any other Loan Document, between or among parties hereto and to the other Loan Documents.

“ Dollars” or “$ ” means, unless otherwise qualified, dollars in lawful currency of the United States.

“ Domestic Subsidiary ” means any Subsidiary organized under the laws of any political subdivision of the United States.

“ Eligible Assignee ” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund, and (d) any other Person (other than a natural person) approved by (i) the Administrative Agent, (ii) the Swingline Lender, (iii) each Issuing Lender and (iv) unless a Default or Event of Default has occurred and is continuing, the Original Borrower (each such approval not to be unreasonably withheld or delayed); provided that notwithstanding the foregoing, “Eligible Assignee” shall not include the Borrower or any of the Borrower’s Affiliates or Subsidiaries.

“ Employee Benefit Plan ” means (a) any employee benefit plan within the meaning of Section 3(3) of ERISA that is maintained for employees of the Borrower or any of its Subsidiaries which the Borrower or any of its Subsidiaries or any of their ERISA Affiliates

12

sponsors, maintains, or to which it makes, is making, or is obligated to make, contributions or (b) any Pension Plan or Multiemployer Plan that has at any time within the preceding six (6) years been maintained for the employees of the Borrower or any of its Subsidiaries or any of their current or former ERISA Affiliates.

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

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

“ ERISA ” means the Employee Retirement Income Security Act of 1974, and the rules and regulations thereunder, each as amended or modified from time to time.

“ ERISA Affiliate ” means any Person who together with the Borrower or any of its Subsidiaries is treated as a single employer within the meaning of Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA.

“ Eurodollar Reserve Percentage ” means, for any day, the percentage (expressed as a decimal and rounded upwards, if necessary, to the next higher 1/100th of 1%) which is in effect for such day as prescribed by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including, without limitation, any basic, supplemental or emergency reserves) in respect of eurocurrency liabilities or any similar category of liabilities for a member bank of the Federal Reserve System in New York City.

“ Event of Default ” means any of the events specified in Section 11.1 ; provided that any requirement for passage of time, giving of notice, or any other condition, has been satisfied.

“ Exchangeable Shares ” means those shares of Capital Stock issued by Bowater Canada, Inc. and listed on the Toronto Stock Exchange (under stock symbol BWX) which are exchangeable at any time at the option of the holder of such shares into common stock of the Parent and which entitle the holders thereof to similar voting rights and dividend payments (on a per share basis) as those granted to holders of the common stock of the Parent.

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“ Excluded Taxes ” means, with respect to the Administrative Agent, any Lender, any Issuing Lender or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable Lending Office is located, (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 4.12(b) ), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new Lending Office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 4.11(e) , except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new Lending Office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 4.11(a) .

“ Existing Facilities ” means the collective reference to (a) the credit facility established pursuant to that certain Credit Agreement dated as of April 22, 2004 (as amended, restated, supplemented or modified) by and among the Canadian Borrower and the Original Borrower, as borrowers, JPMorgan Chase Bank, as U.S. administrative agent, The Bank of Nova Scotia, as Canadian administrative agent and the lenders party thereto and (b) the conduit facility established pursuant that certain Loan Agreement dated as of December 19, 2002 (as amended, restated, supplemented or modified) by and among Bowater Funding Inc., as borrower, the Original Borrower, as initial servicer, the lenders party thereto, SunTrust Capital Markets, Inc. and Wachovia Bank, National Association, as co-agents, and SunTrust Capital Markets, Inc., as administrative agent.

“ Existing Letters of Credit ” means those letters of credit existing on the Closing Date and identified on Schedule 1.1(a) .

“ Existing Notes ” means the collective reference to each of the senior unsecured notes and debentures set forth on Schedule 10.1 .

“ Extensions of Credit ” means, as to any Lender at any time, (a) an amount equal to the sum of (i) the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding, (ii) such Lender’s Commitment Percentage of the L/C Obligations then outstanding and (iii) such Lender’s Commitment Percentage of the Swingline Loans then outstanding or (b) the making of any Loan or participation in any Swingline Loan or any Letter of Credit by such Lender, as the context requires.

“ FDIC ” means the Federal Deposit Insurance Corporation, or any successor thereto.

“ Federal Funds Rate ” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day (or, if such day is not a Business

14

Day, for the immediately preceding Business Day), as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that if such rate is not so published for any day which is a Business Day, the average of the quotation for such day on such transactions received by the Administrative Agent from three Federal Funds brokers of recognized standing selected by the Administrative Agent.

“ Fee Letter ” means the separate fee letter agreement executed by the Original Borrower and Wachovia and/or certain of its affiliates dated April 3, 2006.

“ Fiscal Year ” means the fiscal year of the Borrower and its Subsidiaries ending on December 31.

“ Foreign Lender ” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is resident for tax purposes. For purposes of this definition, the United States, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

“ Foreign Pledge Documents ” means any pledge agreements, charges and other similar documents and agreements granting a lien on the Capital Stock of any first-tier Foreign Subsidiary of any Credit Party in favor of the Administrative Agent, for the ratable benefit of the Secured Parties.

“ Foreign Subsidiary ” means any Subsidiary that is not a Domestic Subsidiary.

“ GAAP ” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

“ Governmental Approvals ” means all authorizations, consents, approvals, permits, licenses and exemptions of, registrations and filings with, and reports to, all Governmental Authorities.

“ Governmental Authority ” means the government of the United States, Canada or any other nation, or of any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“ Guarantors ” means the Parent Guarantor and each Subsidiary Guarantor.

“ Guaranty Obligation ” means, with respect to the Borrower and its Subsidiaries, without duplication, any obligation, contingent or otherwise, of any such Person pursuant to which such Person has directly or indirectly guaranteed any Indebtedness of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or

15

otherwise, of any such Person (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness (whether arising by virtue of partnership arrangements, by agreement to keep well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement condition or otherwise) or (b) entered into for the purpose of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided , that the term Guaranty Obligation shall not include endorsements for collection or deposit in the ordinary course of business.

“ Hazardous Materials ” means any substances or materials (a) which are or become defined as hazardous wastes, hazardous substances, pollutants, contaminants, chemical substances or mixtures or toxic substances under any Environmental Law, (b) which are toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human health or the environment and are or become regulated by any Governmental Authority, (c) the presence of which require investigation or remediation under any Environmental Law or common law, (d) the discharge or emission or release of which requires a permit or license under any Environmental Law or other Governmental Approval, (e) which are deemed to constitute a nuisance or a trespass which pose a health or safety hazard to Persons or neighboring properties, (f) which consist of underground or aboveground storage tanks, whether empty, filled or partially filled with any substance, or (g) which contain, without limitation, asbestos, polychlorinated biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic gas.

“ Hedging Agreement ” means any agreement with respect to any Interest Rate Contract, forward rate agreement, commodity swap, forward foreign exchange agreement, currency swap agreement, cross-currency rate swap agreement, currency option agreement or other agreement or arrangement designed to alter the risks of any Person arising from fluctuations in interest rates, currency values or commodity prices, all as amended, restated, supplemented or otherwise modified from time to time.

“ Hedging Obligations ” means all existing or future payment and other obligations owing by any Credit Party under any Hedging Agreement (which such Hedging Agreement is permitted hereunder) with any Person that is a Lender or an Affiliate of a Lender at the time such Hedging Agreement is executed.

“ Immaterial Subsidiary ” means:

(a) each QSPE;

(b) any Domestic Subsidiary that is not a Wholly-Owned Subsidiary to the extent that (i) there is a provision in the organizational documents of such Domestic Subsidiary or (ii) the Borrower or any of its Subsidiaries is party to a legally enforceable agreement, in either case that would prohibit such Domestic Subsidiary from being a Subsidiary Guarantor without the consent of (or the approval of directors appointed by) a third party owner of such Domestic Subsidiary; and

16

(c) any individual Domestic Subsidiary having total assets with a book value that is less than one percent (1%) of the aggregate book value of the total Consolidated assets of the Borrower and its Subsidiaries (as of the most recent date for which financial statements have been delivered).

“ Indebtedness ” means, with respect to any Person at any date and without duplication, the sum of the following:

(a) all liabilities, obligations and indebtedness for borrowed money of such Person, including, but not limited to, obligations evidenced by bonds, debentures, notes or other similar instruments of such Person;

(b) all obligations of such Person to pay the deferred purchase price of property or services (including, without limitation, all obligations under non-competition, earn-out or similar agreements in connection with an acquisition), except trade payables and accrued obligations arising in the ordinary course of business, so long as such trade accounts payable are payable within ninety (90) days of the date the respective goods are delivered or the respective services are rendered;

(c) the Attributable Indebtedness of such Person with respect to such Person’s obligations in respect of Capital Leases and Synthetic Leases (regardless of whether accounted for as indebtedness under GAAP);

(d) all Indebtedness of any other Person secured by a Lien on any asset owned by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

(e) all Guaranty Obligations of such Person;

(f) all obligations, contingent or otherwise, of such Person in connection with letters of credit, whether or not drawn, including, without limitation, any reimbursement obligation, and bankers’ acceptances issued for the account of such Person;

(g) all cash obligations of any such Person to redeem, repurchase, exchange, defease or otherwise make payments in respect of Capital Stock of such Person, unless such redemption, repurchase, exchange, defeasance or other payment is contingent (unless such contingency has been satisfied) or is not required prior to the date that is ninety-one (91) days after the Maturity Date;

(h) all Net Hedging Obligations of such Person; and

(i) the outstanding attributed principal amount under any asset securitization program of such Person.

For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such

17

Person is not legally liable therefor under Applicable Law or as a result of any legally enforceable contractual limitation with respect to such Indebtedness.

“ Indemnified Taxes ” means Taxes and Other Taxes other than Excluded Taxes.

“ Insurance and Condemnation Event ” means the receipt by the Borrower or any of its Subsidiaries of any cash insurance proceeds or condemnation award payable by reason of theft, loss, physical destruction or damage, taking or similar event with respect to any of their respective property or assets.

“ Intercompany Subordination Agreement ” means an Intercompany Subordination Agreement substantially in the form of Exhibit J by and among the Administrative Agent and the applicable Credit Parties or Subsidiaries thereof party thereto.

“ Intercreditor Agreement ” means each intercreditor agreement by and among the Administrative Agent, the Canadian Administrative Agent, the Credit Parties, the Canadian Credit Parties and each lender or group of lenders (or any authorized representative thereof) with respect to any secured Indebtedness incurred pursuant to Section 10.1(m) , which agreement shall be in form and substance satisfactory to the Administrative Agent and the Canadian Administrative Agent, as amended, restated, supplemented or otherwise modified from time to time in accordance with the terms of this Agreement.

“ Interest Period ” has the meaning assigned thereto in Section 4.1(b) .

“ Interest Rate Contract ” means any interest rate swap agreement, interest rate cap agreement, interest rate floor agreement, interest rate collar agreement, interest rate option or any other agreement regarding the hedging of interest rate risk exposure executed in connection with hedging the interest rate exposure of any Person and any confirming letter executed pursuant to such agreement, all as amended, restated, supplemented or otherwise modified from time to time.

“ ISP98 ” means the International Standby Practices (1998 Revision, effective January 1, 1999), International Chamber of Commerce Publication No. 590.

“ Issuing Lender ” means (a) with respect to Letters of Credit issued hereunder on or after the Closing Date, Wachovia, in its capacity as issuer thereof, or any successor thereto or any other Lender designated as an Issuing Lender by the Original Borrower (with reasonable prior notice of such designation by the Original Borrower to the Administrative Agent) and (b) with respect to the Existing Letters of Credit, the issuers thereof as identified on Schedule 1.1(a) .

“ ITA ” means the Income Tax Act (Canada), as amended or modified from time to time.

“ L/C Commitment ” means the lesser of (a) One Hundred Million Dollars ($100,000,000) and (b) the aggregate Commitments of the Lenders.

“ L/C Facility ” means the letter of credit facility established pursuant to Article III .

“ L/C Obligations ” means at any time, an amount equal to the sum of (a) the aggregate undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate

18

amount of drawings under Letters of Credit which have not then been reimbursed pursuant to Section 3.5 .

“ L/C Participants ” means the collective reference to all of the Lenders other than the applicable Issuing Lender.

“ L/C Supporting Documentation ” has the meaning assigned thereto in Section 3.2 .

“ Lender ” means each Person that is bound by the terms of this Agreement as a Lender (including, without limitation, each Issuing Lender and the Swingline Lender unless the context otherwise requires) and each Person that hereafter becomes a party to this Agreement as a Lender pursuant to Section 13.10 .

“ Lending Office ” means, with respect to any Lender, the office of such Lender maintaining such Lender’s Extensions of Credit.

“ Letter of Credit Application ” means an application, in the form specified by the applicable Issuing Lender from time to time, requesting the applicable Issuing Lender to issue a Letter of Credit.

“ Letters of Credit ” means the collective reference to letters of credit issued pursuant to Section 3.1 and the Existing Letters of Credit.

“ LIBOR ” means the rate of interest per annum determined on the basis of the rate for deposits in Dollars in minimum amounts of at least $5,000,000 for a period equal to the applicable Interest Period which appears on the Reuters Page LIBOR01 (or any successor page) at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of the applicable Interest Period (rounded upward, if necessary, to the nearest 1/100 ^th of 1%). If, for any reason, such rate does not appear on Reuters Page LIBOR01 (or any successor page) then “LIBOR” shall be determined by the Administrative Agent to be the arithmetic average of the rate per annum at which deposits in Dollars in minimum amounts of at least $5,000,000 would be offered by first class banks in the London interbank market to the Administrative Agent at approximately 11:00 a.m. (London time) two (2) Business Days prior to the first day of the applicable Interest Period for a period equal to such Interest Period. Each calculation by the Administrative Agent of LIBOR shall be conclusive and binding for all purposes, absent manifest error.

“ LIBOR Rate ” means a rate per annum (rounded upwards, if necessary, to the next higher 1/100th of 1%) determined by the Administrative Agent pursuant to the following formula:

LIBOR Rate =                         LIBOR                          

                        1.00-Eurodollar Reserve Percentage

“ LIBOR Rate Loan ” means any Loan bearing interest at a rate based upon the LIBOR Rate as provided in Section 4.1(a) .

“ Lien ” means, with respect to any asset, any mortgage, leasehold mortgage, lien, pledge, charge, security interest, hypothec, hypothecation, assignment by way of security or

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encumbrance of any kind in respect of such asset. For the purposes of this Agreement, a Person shall be deemed to own subject to a Lien any asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease or other title retention agreement relating to such asset.

“ Loan Documents ” means, collectively, this Agreement, each Note, the Letter of Credit Applications, the Security Documents, each Intercreditor Agreement, the Intercompany Subordination Agreement, and each other document, instrument, certificate and agreement executed and delivered by the Parent, the Borrower or any of their respective Subsidiaries in connection with this Agreement or otherwise referred to herein or contemplated hereby (excluding any Hedging Agreement), all as may be amended, restated, supplemented or otherwise modified from time to time.

“ Loans ” means the collective reference to the Revolving Credit Loans and the Swingline Loans, and “Loan” means any of such Loans.

“ Material Adverse Effect ” means, with respect to the Borrower or any of its Subsidiaries, a material adverse effect on (a) the business, assets, liabilities (actual or contingent), operations or condition (financial or otherwise) of the Borrower and its Subsidiaries, taken as a whole, or (b) the ability of any such Person to perform its obligations under the Loan Documents to which it is a party.

“ Material Subsidiary ” means:

(a) each Domestic Subsidiary of the Borrower, other than the Immaterial Subsidiaries; and

(b) each Subsidiary that, notwithstanding the definition of Immaterial Subsidiary, is designated as a Material Subsidiary pursuant to Section 8.10(b) .

Notwithstanding anything to the contrary contained in this Agreement or any other Loan Document, any Subsidiary that (i) owns a Material Subsidiary or (ii) provides a guaranty of (A) the Existing Notes, (B) any Indebtedness incurred to refinance, refund, renew or extend the Existing Notes as permitted pursuant to Section 10.1(d) , (C) any Indebtedness permitted pursuant to Section 10.1(m) , (D) any Indebtedness incurred to refinance, refund, renew or extend any Indebtedness incurred pursuant to Section 10.1(m) as permitted pursuant to Section 10.1(d) or (E)  any Indebtedness permitted pursuant to Section 11.1(o)(viii) , in each case, shall be a Material Subsidiary.

“ Maturity Date ” means the earliest to occur of:

(a) May 25, 2011; provided , however, that such date shall be accelerated to:

(i) the date which is ninety-one (91) days prior to the then current maturity date of any Specified Existing Note if on the date which is one hundred twenty (120) days prior to the then current maturity date of such Specified Existing Note either (A) the remaining outstanding principal balance thereof (excluding any such balance as to which sums have been set aside for the payment thereof

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pursuant to any defeasance or sinking fund or escrow arrangement or similar provisions) is in excess of $75,000,000 or (B) the Aggregate Credit Exposure is in excess of $100,000,000 and the outstanding principal balance of such Specified Existing Note (excluding any such balance as to which sums have been set aside for the payment thereof pursuant to any defeasance or sinking fund or escrow arrangement or similar provisions) has not been paid in full; or

(ii) the date which is ninety-one (91) days prior to the then current maturity date of any Indebtedness permitted pursuant to Section 11.1(o)(viii) if, on the date which is one hundred twenty (120) days prior to the then current maturity date of such Indebtedness, such Indebtedness has not been paid in full in accordance with the terms of this Agreement or extended or refinanced such that the maturity of such Indebtedness is more than ninety-one (91) days after May 25, 2011.

(b) the date of termination of the entire Commitment by the Borrower pursuant to Section 2.5; or

(c) the date of termination of the Commitment by the Administrative Agent on behalf of the Lenders pursuant to Section 11.2(a) .

“ Moody’s ” means Moody’s Investors Service, Inc. and any successor thereto.

“ Multiemployer Plan ” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA to which the Borrower or any of its Subsidiaries or any of their ERISA Affiliates is making, or is accruing an obligation to make, or has accrued an obligation to make contributions within the preceding six (6) years.

“ Net Cash Proceeds ” means, as applicable;

(a) with respect to any Asset Disposition, the gross cash proceeds received by the Borrower or any of its Subsidiaries therefrom less the sum of the following, without duplication, (i) selling expenses incurred in connection with such Asset Disposition (including reasonable brokers’ fees and commissions, legal, accounting and other professional and transactional fees, transfer and similar taxes and the Original Borrower’s reasonable good faith estimate of income taxes paid or payable in connection with such sale), (ii) reasonable reserves with respect to post-closing adjustments, indemnities and other contingent liabilities established in connection with such Asset Disposition ( provided that, to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds), (iii) the principal amount, premium or penalty, if any, interest and other amounts on any Indebtedness secured by a Lien on the assets (or a portion thereof) sold in such Asset Disposition, which Indebtedness is repaid with such proceeds and (iv) the Original Borrower’s reasonable good faith estimate of cash payments required to be made within ninety (90) days of such Asset Disposition with respect to retained liabilities directly related to the assets (or a portion thereof) sold in such Asset Disposition ( provided that, to the extent that cash proceeds are not used to make payments in respect of such retained liabilities within

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ninety (90) days of such Asset Disposition, such cash proceeds shall constitute Net Cash Proceeds); and

(b) with respect to any Insurance and Condemnation Event, the gross cash proceeds received by the Borrower or any of its Subsidiaries therefrom less the sum of the following, without duplication, (i) all fees and expenses in connection therewith and (ii) the principal amount, premium or penalty, if any, interest and other amounts on any Indebtedness secured by a Lien on the assets (or a portion thereof) subject to such Insurance and Condemnation Event, which Indebtedness is repaid in connection therewith.

“ Net Hedging Obligations ” means, with respect to any Hedging Agreement as of any date, the Termination Value of such Hedging Agreement on such date.

“ Newco ” means a corporation or other entity to be formed under the laws of a state of the United States.

“ Newco Fixed Assets ” means, collectively, the Catawba Mill, the Catawba Mill Real Property, the Catawba Mill Equipment and any and all other real property and equipment owned or thereafter acquired by Newco or in which Newco has or at any time in the future may acquire any right, title or interest, and wherever located or deemed located to the extent related to or forming a part of the Catawba Mill, the Catawba Mill Real Property or the Catawba Mill Equipment; provided , that in no event shall the Newco Fixed Assets include any Coverage Assets.

“ Newco Transactions ” means the following transactions, in each case, to the extent permitted pursuant to, and in accordance with the terms of, this Agreement and the Canadian Credit Agreement:

(a) the formation by the Original Borrower of Newco;

(b) the transfer of the Catawba Mill Assets from the Original Borrower to Newco in exchange for the Catawba Note; and

(c) the transfer of all of the issued and outstanding Capital Stock of Newco held by the Original Borrower to the Parent pursuant to Section 10.5(i) or Section 10.6(h) .

“ New Material Subsidiary ” has the meaning assigned thereto in Section 8.10 .

“ Notes ” means the collective reference to the Revolving Credit Notes and the Swingline Note.

“ Notice of Account Designation ” has the meaning assigned thereto in Section 2.3(b) .

“ Notice of Borrowing ” has the meaning assigned thereto in Section 2.3(a) .

“ Notice of Conversion/Continuation ” has the meaning assigned thereto in Section 4.2 .

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“ Notice of Prepayment ” has the meaning assigned thereto in Section 2.4(c) .

“ Obligations ” means, in each case, whether now in existence or hereafter arising: (a) the principal of and interest on (including interest accruing after the filing of any bankruptcy or similar petition) the Loans, (b) the L/C Obligations, (c) all Hedging Obligations and (d) all other fees and commissions (including reasonable attorneys’ fees), charges, indebtedness, loans, liabilities, financial accommodations, obligations, covenants and duties owing by the Borrower or any of its Subsidiaries to the Lenders or the Administrative Agent, in each case under any Loan Document, with respect to any Loan or Letter of Credit, of every kind, nature and description, direct or indirect, absolute or contingent, due or to become due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any note.

“ OFAC ” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.

“ Officer’s Compliance Certificate ” means a certificate of the chief financial officer, the treasurer, or the assistant treasurer of the Original Borrower substantially in the form of Exhibit F .

“ Operating Lease ” means, as to any Person as determined in accordance with GAAP, any lease of property (whether real, personal or mixed) by such Person as lessee which is not a Capital Lease.

“ Original Borrower ” has the meaning assigned thereto in the introductory paragraph.

“ Original Newco Indebtedness ” has the meaning assigned thereto in Section 10.1(m)(i) .

“ Other Taxes ” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

“ Parent ” means AbitibiBowater, Inc., a Delaware corporation f/k/a Alpha-Bravo Holdings, Inc.

“ Parent Guarantor ” means the Parent, as guarantor pursuant to the Parent Guaranty Agreement.

“ Parent Guaranty Agreement ” means the unconditional guaranty agreement executed by the Parent pursuant to Section 8.10(e)(i) in favor of the Administrative Agent, for the ratable benefit of the Secured Parties, in form and substance satisfactory to the Administrative Agent, as amended, restated, supplemented or otherwise modified from time to time.

“ Parent Overhead Expenses ” means (a) accounting and auditing costs and expenses incurred by the Parent in the ordinary course of its business in connection with preparing financial reports and tax filings; (b) customary fees and expenses payable to the SEC and other reasonable and customary costs and expenses payable in connection with the Parent being a publicly traded company (including, without limitation, reasonable and customary fees and expenses required to be paid for professional and regulatory compliance); (c) reasonable and customary legal fees and expenses required for the corporate maintenance of the Parent and the

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Borrower and its Subsidiaries; (d) reasonable and customary director fees; (e) reasonable and customary costs and expenses payable for director and officer insurance; (f) transfer agent fees payable in connection with Capital Stock of the Parent; and (g) franchise taxes and other fees payable to the jurisdiction of incorporation or qualification of the Parent incurred in the ordinary course of conducting its business; provided that in no event shall Parent Overhead Expenses include management fees, salaries, bonuses, debt service and dividends and other distributions in respect of the Capital Stock of the Parent.

“ Participant ” has the meaning assigned thereto in Section 13.10(d) .

“ PBGC ” means the Pension Benefit Guaranty Corporation or any successor agency.

“ Pension Plan ” means any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of the Code and which (a) is maintained for the employees of the Borrower or any of its Subsidiaries or any of their ERISA Affiliates or (b) has at any time within the preceding six (6) years been maintained for the employees of the Borrower or any of its Subsidiaries or any of their current or former ERISA Affiliates which the Borrower or any of its Subsidiaries or any of their ERISA Affiliates sponsors, maintains, or to which it makes, is making or is obligated to make, contributions.

“ Permitted Acquisition ” means any investment by the Borrower or any of its Subsidiaries in the form of the acquisition of all or substantially all of the business or assets, or any portion of the business or assets that constitutes a line of business, a business unit or a division (whether by the acquisition of Capital Stock, assets or any combination thereof), of any other Person if each such acquisition or investment meets all of the following requirements:

(a) with respect to any acquisition:

(i) such acquisition is not a hostile acquisition (with evidence thereof to be provided to the Administrative Agent or the Canadian Administrative Agent upon its reasonable request);

(ii) the Person or business to be acquired shall be in a substantially similar line of business as the Borrower and its Subsidiaries pursuant to Section 10.12 ;

(iii) if such transaction is a merger or consolidation involving a Credit Party or a Canadian Credit Party, the surviving Person shall be a Credit Party or Canadian Credit Party and no Change of Control shall have been effected thereby;

(iv) if the acquisition will result in the acquisition of, or creation of, any New Material Subsidiary, the Borrower shall comply with Section 8.10 hereof;

(v) no Default or Event of Default shall have occurred and be continuing both before and after giving effect to such acquisition; and

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(vi) after giving effect to the acquisition, at least (A) $50,000,000 in availability shall exist under the Credit Facility and (B) $25,000,000 in availability shall exist under the Canadian Credit Facility; and

(b) with respect to any acquisition for which the Permitted Acquisition Consideration is greater than $50,000,000 or any acquisition funded (in whole or in part) by Extensions of Credit or Canadian Extensions of Credit (in addition to the requirements set forth in clause (a) above):

(i) no less than fifteen (15) Business Days prior to the proposed closing date of such acquisition, the Original Borrower shall have delivered written notice of such acquisition to the Administrative Agent and the Canadian Administrative Agent, which notice shall include the proposed closing date of such acquisition;

(ii) no later than five (5) Business Days prior to the proposed closing date of such acquisition, the Original Borrower shall have delivered to the Administrative Agent and the Canadian Administrative Agent an Officer’s Compliance Certificate demonstrating, in form and substance reasonably satisfactory thereto, (A)  pro forma compliance (as of the most recent fiscal quarter ended for which financial statements have been delivered pursuant hereto, adjusted to give effect the acquisition and any Extensions of Credit or Canadian Extensions of Credit made or to be made in connection therewith) with each covenant contained in Article IX and (B) a pro forma Consolidated Senior Secured Leverage Ratio (as of the most recent fiscal quarter ended for which financial statements have been delivered pursuant hereto, adjusted to give effect the acquisition and any Extensions of Credit or Canadian Extensions of Credit made or to be made in connection therewith) not to exceed 1.00 to 1.00;

(iii) no later than five (5) Business Days prior to the proposed closing date of such acquisition, the Original Borrower, to the extent requested by the Administrative Agent or the Canadian Administrative Agent, (A) shall have delivered to the Administrative Agent or the Canadian Administrative Agent, as applicable, promptly upon the finalization thereof, copies of substantially final Permitted Acquisition Documents, which shall be in form and substance reasonably satisfactory to the Administrative Agent or the Canadian Administrative Agent, as applicable, and (B) shall have delivered to, or made available for inspection by, the Administrative Agent or the Canadian Administrative Agent, as applicable, substantially complete Permitted Acquisition Diligence Information, which shall be in form and substance reasonably satisfactory to the Administrative Agent or the Canadian Administrative Agent, as applicable;

(iv) the Original Borrower shall provide such other documents and other information as may be reasonably requested by the Administrative Agent or the Canadian Administrative Agent in connection with the acquisition; and

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(v) the Original Borrower shall demonstrate, in form and substance reasonably satisfactory to the Administrative Agent and the Canadian Administrative Agent, that the entity to be acquired had positive Consolidated EBITDA for the four (4) fiscal quarter period ended prior to the proposed closing date of such acquisition (it being agreed and acknowledged that clause (b)(vi) of the definition of “Consolidated EBITDA” shall be calculated solely with respect to the Person or business to be acquired); and

(c) with respect to any acquisition for which the Permitted Acquisition Consideration is less than $50,000,000 and such acquisition is not funded (in whole or in part) by Extensions of Credit or Canadian Extensions of Credit (in addition to the requirements set forth in clause (a) above):

(i) no more than ten (10) days following the closing date of such acquisition, the Original Borrower shall have delivered written notice of such acquisition to the Administrative Agent and the Canadian Administrative Agent, which notice shall include the closing date of such acquisition; and

(ii) to the extent requested by the Administrative Agent or the Canadian Administrative Agent, the Original Borrower shall have delivered to the Administrative Agent or the Canadian Administrative Agent, as applicable, promptly upon the finalization thereof (but no later than fifteen (15) days after the closing date of such acquisition) copies of substantially final Permitted Acquisition Documents.

Notwithstanding anything to the contrary contained in this Agreement or the other Loan Documents, the Original Borrower shall have obtained the prior written consent of the Required Lenders prior to the consummation of such acquisition if (1) the Permitted Acquisition Consideration for any such acquisition (or series of related acquisitions), together with all other acquisitions consummated during the previous twelve (12) month period exceeds $100,000,000 in the aggregate (excluding any portion of the acquisitions paid with the proceeds from any equity issuance by the Borrower) and (2) the Permitted Acquisition Consideration for such acquisition (or series of related acquisitions), together with all other acquisitions consummated during the term of this Agreement, exceeds $300,000,000 in the aggregate (excluding any portion of the acquisitions paid with the proceeds from any equity issuance by the Borrower).

“ Permitted Acquisition Consideration ” means the aggregate amount of the purchase price (including, but not limited to, any assumed debt, earn-outs (valued at the maximum amount payable thereunder), deferred payments, or Capital Stock of the Borrower, net of the applicable acquired company’s cash and Cash Equivalent balance as shown on its most recent financial statements delivered in connection with the applicable Permitted Acquisition) to be paid on a singular basis in connection with any applicable Permitted Acquisition as set forth in the applicable Permitted Acquisition Documents executed by the Borrower or any of its Subsidiaries in order to consummate the applicable Permitted Acquisition.

“ Permitted Acquisition Diligence Information ” means with respect to any acquisition proposed by the Borrower or any of its Subsidiaries, to the extent applicable and in the

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possession of the Borrower or any of its Subsidiaries, all material financial information, all material contracts, all material customer lists, all material supply agreements, and all other material information, in each case, reasonably requested to be delivered to the Administrative Agent or the Canadian Administrative Agent in connection with such acquisition (except to the extent that any such information is (a) subject to any confidentiality agreement, unless mutually agreeable arrangements can be made to preserve such information as confidential, (b) classified or (c) subject to any attorney-client privilege).

“ Permitted Acquisition Documents ” means with respect to any acquisition proposed by the Borrower or any of its Subsidiaries, the purchase agreement, sale agreement, merger agreement or other similar agreement evidencing such acquisition (whichever is applicable), including, without limitation, all schedules and exhibits thereto and each other material document executed, delivered, contemplated by or prepared in connection therewith and any amendment, modification or supplement to any of the foregoing.

“ Permitted Liens ” means the Liens permitted pursuant to Section 10.2 .

“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, governmental authority or other entity.

“ Prime Rate ” means, at any time, the rate of interest per annum publicly announced from time to time by Wachovia as its prime rate. Each change in the Prime Rate shall be effective as of the opening of business on the day such change in such prime rate occurs. The parties hereto acknowledge that the rate announced publicly by Wachovia as its prime rate is an index or base rate and shall not necessarily be its lowest or best rate charged to its customers or other banks.

“ QSPE ” means each of the following: (a) Calhoun Note Holdings AT LLC, (b) Calhoun Note Holdings TI LLC, (c) Bowater Catawba Note Holdings I LLC, (d) Bowater Catawba Note Holdings II LLC, (e) Bowater Saluda Note Holdings LLC, (f) Timber Note Holding LLC and (g) any other qualified special purpose entity created to facilitate the sale and/or the monetization of receivables from the sale of timberlands pursuant to Section 10.5(g) ; provided that:

(i) no portion of the Indebtedness or any other obligations (contingent or otherwise) of any such Person (1) may be guaranteed by the Borrower or any of its Subsidiaries, (2) may be recourse to or obligate the Borrower or any of its Subsidiaries in any way or (3) may subject any property or asset of the Borrower or any of its Subsidiaries, directly or indirectly, contingently or otherwise, to the satisfaction thereof (other than, in the case of clauses (1) (solely with respect to guaranties of make-whole premiums), (2) and (3), pursuant to Standard Securitization Undertakings);

(ii) the Borrower and its Subsidiaries may not have any material contract, agreement, arrangement or understanding with any such Person other than on terms no less favorable to the Borrower or any of its Subsidiaries than those that might be obtained at the time from Persons that are not Affiliates of the Borrower or any of its Subsidiaries; and

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(iii) the Borrower and its Subsidiaries may not (A) have any obligation to maintain or preserve the financial condition of any such Person or (B) cause any such Person to achieve certain levels of operating results.

“ Register ” has the meaning assigned thereto in Section 13.10(c) .

“ Reimbursement Obligation ” means the obligation of the Borrower to reimburse the applicable Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit.

“ Related Parties ” means, with respect to any Person, such Person’s Affiliates and the directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.

“ Required Agreement Lenders ” means, at any date, any combination of Lenders having more than fifty percent (50%) of the sum of the aggregate amount of the Commitment under this Credit Facility or, if the Commitment under this Credit Facility has been terminated, any combination of Lenders holding more than fifty percent (50%) of the aggregate Extensions of Credit.

“ Required Lenders ” means, at any date, any combination of Lenders and Canadian Lenders having more than fifty percent (50%) of the sum of (a) the aggregate amount of the Commitment under this Credit Facility (or if the Commitment has been terminated, the aggregate amount of Extensions of Credit under this Credit Facility) plus (b) the aggregate amount of the commitments under the Canadian Credit Facility (or, if the commitments under the Canadian Credit Facility have been terminated, the aggregate amount of the Canadian Extensions of Credit).

“ Responsible Officer ” means, as to any Person, the chief executive officer, president, chief financial officer, controller, treasurer or assistant treasurer of such Person or any other officer of such Person reasonably acceptable to the Administrative Agent and the Canadian Administrative Agent. Any document delivered hereunder that is signed by a Responsible Officer of a Person shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Person and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Person.

“ Restricted Jurisdictions ” means California, North Dakota, South Dakota or Vermont.

“ Restricted Subsidiary ” means any Person that is a “Restricted Subsidiary” pursuant to the definition thereof as contained in the Existing Notes as in effect as of the Closing Date, for so long as such Existing Notes or any Indebtedness incurred to refinance such Existing Notes is outstanding and includes provisions restricting the granting of a lien on the capital stock or indebtedness of such Restricted Subsidiaries.

“ Revolving Credit Facility ” means the revolving credit facility established pursuant to Article II .

“ Revolving Credit Loan ” means any revolving loan made to the Borrower pursuant to Section 2.1 , and all such revolving loans collectively as the context requires.

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“ Revolving Credit Note ” means a promissory note made by the Borrower in favor of a Lender evidencing the Revolving Credit Loans made by such Lender, substantially in the form of Exhibit A-1 , and any amendments, supplements and modifications thereto, any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.

“ S&P ” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto.

“ SEC ” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

“ Sanctioned Entity ” shall mean (a) an agency of the government of, (b) an organization directly or indirectly controlled by, or (c) a person resident in a country that is subject to a sanctions program identified on the list maintained by OFAC and available at http://www.treas.gov/offices/enforcement/ofac/sanctions/index.html , or as otherwise published from time to time as such program may be applicable to such agency, organization or person.

“ Sanctioned Person ” shall mean a person named on the list of Specially Designated Nationals or Blocked Persons maintained by OFAC available at http://www.treas.gov/offices/ enforcement/ofac/sdn/index.html , or as otherwise published from time to time.

“ Secured Parties ” means the Administrative Agent, the Lenders and/or any party to a Hedging Agreement that was a Lender or an Affiliate of a Lender at the time such Hedging Agreement was executed.

“ Security Documents ” means the collective reference to the Collateral Agreement, the Subsidiary Guaranty Agreement, the Parent Guaranty Agreement, the Catawba Mortgage, each Foreign Pledge Document and each other agreement or writing pursuant to which the Parent or any Credit Party purports to pledge or grant a security interest in any property or assets securing the Obligations or any such Person purports to guaranty the payment and/or performance of the Obligations, in each case, as amended, restated, supplemented or otherwise modified from time to time.

“ Significant Indebtedness ” means Indebtedness (other than the Obligations and the Canadian Obligations) of the Borrower and its Subsidiaries the outstanding principal amount of which is in excess of $25,000,000.

“ Solvent ” means, as to the Borrower and its Subsidiaries on a particular date, that any such Person (a) has capital sufficient to carry on its business and transactions and all business and transactions in which it is about to engage and is able to pay its debts as they mature, (b) has assets having a value, both at fair valuation and at present fair saleable value, greater than the amount required to pay its probable liabilities (including contingencies), and (c) does not believe that it will incur debts or liabilities beyond its ability to pay such debts or liabilities as they mature.

“ Specified Existing Notes ” means each of the Existing Notes which (a) as of the Closing Date, matures or is subject to mandatory redemption prior to May 25, 2011 and (b) has an

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outstanding principal amount, as of the Closing Date, in excess of $75,000,000. The Specified Existing Notes shall be set forth on Schedule 1.1(b) .

“ Specified Non-Recurring Charges ” means the non-recurring charges against income taken by the Original Borrower during the following periods in the following amounts:

(a) with respect to the fiscal quarter ended March 31, 2007, non-recurring charges in the amount of $9,500,000;

(b) with respect to the fiscal quarter ended June 30, 2007, non-recurring charges in the amount of $20,000,000;

(c) with respect to the fiscal quarter ended September 30, 2007, non-recurring charges in the amount of $46,000,000;

(d) with respect to the fiscal quarter ending December 31, 2007, non-recurring charges consisting of the following, without duplication, (i) severance expenses of the Original Borrower, (ii) merger costs incurred with respect to the Combination and (iii) other mill closure costs, in each case, taken during such quarter, in an aggregate amount to be determined in accordance with GAAP, but not to exceed $100,000,000; and

(e) with respect to the fiscal quarter ending March 31, 2008, non-recurring charges consisting of the following, without duplication, (i) severance expenses of the Original Borrower, (ii) merger costs incurred with respect to the Combination and (iii) other mill closure costs, in each case, taken during such quarter, in an aggregate amount to be determined in accordance with GAAP, but not to exceed $100,000,000 less the amount of Specified Non-Recurring Charges taken pursuant to clause (d) above with respect to the fiscal quarter ended December 31, 2007;

provided that, notwithstanding anything to the contrary contained in this Agreement or any other Loan Document, for purposes of calculating the Consolidated Senior Secured Leverage Ratio and the interest coverage ratio as set forth in Section 9.2 , such non-recurring charges shall be excluded from the non-recurring charges included in clause (b)(v) of the definition of Consolidated EBITDA.

“ Standard Securitization Undertakings ” means, collectively, (i) customary arms-length servicing obligations (together with any related performance guaranties), (ii) obligations (together with any related performance guaranties) to refund the purchase price or grant purchase price credits for dilutive events or misrepresentation (in each case unrelated to the collectibility of receivables or creditworthiness of the associated account debtors), (iii) representations, warranties, covenants and indemnities (together with any related performance guaranties) of a type that are reasonably customary in accounts receivable securitizations and (iv) in the case of a QSPE, a guarantee by the Borrower or its Subsidiaries of any make whole premium (but not any principal or interest) on Indebtedness of such QSPE.

“ Subordinated Indebtedness ” means the collective reference to any Indebtedness of the Borrower or any of its Subsidiaries subordinated in right and time of payment to the Obligations

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and containing such other terms and conditions, in each case as are satisfactory to the Administrative Agent and the Canadian Administrative Agent.

“ Subsidiary ” means as to any Person, any corporation, partnership, limited liability company or other entity of which more than fifty percent (50%) of the outstanding Capital Stock having ordinary voting power to elect a majority of the board of directors or other persons or governing body performing similar functions of such corporation, partnership, limited liability company or other entity is at the time directly or indirectly owned or controlled by such Person and/or one or more Subsidiaries of such Person (irrespective of whether, at the time, Capital Stock of any other class or classes of such corporation, partnership, limited liability company or other entity shall have or might have voting power by reason of the happening of any contingency); provided , however, notwithstanding the foregoing, the terms “Subsidiary” and “Subsidiaries”:

(a) shall include (i) all Subsidiaries of the Original Borrower (other than those noted in clause (b) below) and (ii) all Subsidiaries of Newco; and

(b) shall exclude (i) all QSPEs and (ii) all of the Abitibi Entities.

Unless otherwise qualified, references to “Subsidiary” or “Subsidiaries” herein shall refer to those of the Borrower.

“ Subsidiary Borrower ” means any Domestic Subsidiary of the Borrower that is designated as a borrower under this agreement in accordance with the terms of Section 4.14 .

“ Subsidiary Guarantors ” means each direct or indirect Material Subsidiary of the Borrower (a) in existence on the Closing Date or (b) which becomes a party to the Subsidiary Guaranty Agreement in accordance with Section 8.10 .

“ Subsidiary Guaranty Agreement ” means the unconditional guaranty agreement of even date executed by the Subsidiary Guarantors in favor of the Administrative Agent, for the ratable benefit of the Secured Parties, substantially in the form of Exhibit H , as amended, restated, supplemented or otherwise modified from time to time.

“ Swingline Commitment ” means the lesser of (a) Ten Million Dollars ($10,000,000) and (b) the Commitment.

“ Swingline Facility ” means the swingline facility established pursuant to Section 2.2 .

“ Swingline Lender ” means Wachovia in its capacity as swingline lender hereunder.

“ Swingline Loan ” means any swingline loan made by the Swingline Lender to the Borrower pursuant to Section 2.2 , and all such swingline loans collectively as the context requires.

“ Swingline Note ” means a promissory note made by the Borrower in favor of the Swingline Lender evidencing the Swingline Loans made by the Swingline Lender, substantially in the form of Exhibit A-2 , and any amendments, supplements and modifications thereto, any

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substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.

“ Swingline Termination Date ” means the first to occur of (a) the resignation of Wachovia as Administrative Agent in accordance with Section 12.6 and (b) the Maturity Date.

“ Synthetic Lease ” means any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing product where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an Operating Lease in accordance with GAAP.

“ Taxes ” means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“ Termination Event ” means except for any such event or condition that could not reasonably be expected to have a Material Adverse Effect: (a) a “Reportable Event” described in Section 4043 of ERISA for which the notice requirement has not been waived by the PBGC, or (b) the withdrawal of the Borrower or any of its Subsidiaries or any of their ERISA Affiliates from a Pension Plan during a plan year in which it was a “substantial employer” as defined in Section 4001(a)(2) of ERISA, or (c) the termination of a Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment as a termination, under Section 4041 of ERISA or similar provision of other Applicable Law, if the plan assets are not sufficient to pay all plan liabilities, or (d) the institution of proceedings to terminate, or the appointment of a trustee with respect to, any Pension Plan by the PBGC or any other applicable Governmental Authority under other Applicable Law, or (e) any other event or condition which would constitute grounds under Section 4042(a) of ERISA or other Applicable Law for the termination of, or the appointment of a trustee to administer, any Pension Plan, or (f) the imposition of a Lien pursuant to Section 412 of the Code or Section 302 of ERISA or the provisions of any other Applicable Law, or (g) the partial or complete withdrawal of the Borrower or any of its Subsidiaries or of any of their ERISA Affiliates from a Multiemployer Plan if withdrawal liability is asserted by such plan, or (h) any event or condition which results in the reorganization or insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA, or (i) any event or condition which results in the termination of a Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA, or (j) the termination of a Canadian Pension Plan, the filing of a notice of intent to terminate a Canadian Pension Plan or the treatment of a Canadian Pension Plan amendment as a termination, under Applicable Law, if the plan assets are not sufficient to pay all plan liabilities, or (k) the institution of proceedings to terminate, or the appointment of a trustee with respect to, any Canadian Pension Plan by any applicable Governmental Authority under Applicable Law, or (l) any other event or condition which would constitute grounds under Applicable Law for the termination of, or the appointment of a trustee to administer, any Canadian Pension Plan, or (m) the partial or complete withdrawal of the Borrower or any of its Subsidiaries from a Canadian Multiemployer Plan if withdrawal liability is asserted by such plan, or (n) any event or condition which results in the reorganization or insolvency of a Canadian Multiemployer Plan, or (o) any event or condition which results in the

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termination of a Canadian Multiemployer Plan or the institution by any Governmental Authority of proceedings to terminate a Canadian Multiemployer Plan.

“ Termination Value ” means, in respect of any one or more Hedging Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedging Agreements, (a) for any date on or after the date such Hedging Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedging Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedging Agreements (which may include a Lender or any Affiliate of a Lender).

“ Third Amendment ” means that certain Third Amendment and Waiver dated as of Third Amendment Effective Date by and among the Original Borrower, the Subsidiary Guarantors and the Administrative Agent (on behalf of itself and the Lenders party thereto).

“ Third Amendment Effective Date ” means February 25, 2008.

“ UCC ” means the Uniform Commercial Code as in effect in the State of New York, as amended or modified from time to time.

“ United States ” means the United States of America.

“ Wachovia ” means Wachovia Bank, National Association, a national banking association, and its successors.

“ Wholly-Owned ” means, with respect to a Subsidiary, that all of the shares of Capital Stock of such Subsidiary are, directly or indirectly, owned or controlled by the Borrower and/or one or more of its Wholly-Owned Subsidiaries (except for (a) directors’ qualifying shares or other shares required by Applicable Law to be owned by a Person other than the Borrower and (b) the Exchangeable Shares).

SECTION 1.2 Other Definitions and Provisions . With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document: (a) the definitions of terms herein shall apply equally to the singular and plural forms of the terms defined, (b) whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms, (c) the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”, (d) the word “will” shall be construed to have the same meaning and effect as the word “shall”, (e) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (f) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (g) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (h) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (i) the words “asset” and “property” shall be construed to have the

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same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights, (j) the term “ documents ” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form, (k) in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including”, and (l) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

SECTION 1.3 Accounting Terms . All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with GAAP as in effect from time to time, applied on a consistent basis and in a manner consistent with that used in preparing the audited financial statements required by Section 7.1(b) , except as otherwise specifically prescribed herein.

SECTION 1.4 UCC Terms . Terms defined in the UCC in effect on the Closing Date and not otherwise defined herein shall, unless the context otherwise indicates, have the meanings provided by those definitions. Subject to the foregoing, the term “ UCC ” refers, as of any date of determination, to the UCC then in effect.

SECTION 1.5 Rounding . Any financial ratios required to be maintained pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

SECTION 1.6 References to Agreement and Laws . Unless otherwise expressly provided herein, (a) references to formation documents, governing documents, agreements (including the Loan Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications are not prohibited by any Loan Document; and (b) references to any Applicable Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Applicable Law.

SECTION 1.7 Times of Day . Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

SECTION 1.8 Letter of Credit Amounts . Unless otherwise specified, all references herein to the amount of a Letter of Credit at any time shall be deemed to mean the maximum face amount of such Letter of Credit after giving effect to all increases thereof contemplated by such Letter of Credit or the Letter of Credit Application therefor, whether or not such maximum face amount is in effect at such time.

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SECTION 1.9 Amount of Obligations . Unless otherwise specified, for purposes of this Agreement, any determination of the amount of any outstanding Canadian Extensions of Credit (including, without limitation, Canadian Loans) or Canadian Obligations shall be based upon the Dollar Amount of such outstanding Canadian Extensions of Credit (including, without limitation, Canadian Loans) or Canadian Obligations. For the purpose of this Section 1.9 , “Dollar Amount” means the amount of Dollars which is equivalent to the amount so expressed in Canadian Dollars at the most favorable spot exchange rate reasonably determined by the Administrative Agent to be available to it at the relevant time and “ Canadian Dollar ” means, at any time of determination, the then official currency of Canada.

ARTICLE II

REVOLVING CREDIT FACILITY

SECTION 2.1 Revolving Credit Loans . Subject to the terms and conditions of this Agreement, and in reliance upon the representations and warranties set forth herein, each Lender severally agrees to make Revolving Credit Loans to the Borrower from time to time from the Closing Date through, but not including, the Maturity Date as requested by the Borrower in accordance with the terms of Section 2.3 ; provided , that (a) the aggregate principal amount of all outstanding Revolving Credit Loans (after giving effect to any amount requested) shall not exceed the Borrowing Limit and (b) the principal amount of outstanding Revolving Credit Loans from any Lender shall not at any time exceed such Lender’s Commitment less such Lender’s Commitment Percentage of outstanding L/C Obligations and outstanding Swingline Loans. Each Revolving Credit Loan by a Lender shall be in a principal amount equal to such Lender’s Commitment Percentage of the aggregate principal amount of Revolving Credit Loans requested on such occasion. Subject to the terms and conditions hereof, the Borrower may borrow, repay and reborrow Revolving Credit Loans hereunder until the Maturity Date.

SECTION 2.2 Swingline Loans .

(a) Availability . Subject to the terms and conditions of this Agreement, the Swingline Lender agrees to make Swingline Loans to the Borrower from time to time from the Closing Date through, but not including, the Swingline Termination Date; provided , that the aggregate principal amount of all outstanding Swingline Loans (after giving effect to any amount requested), shall not exceed the lesser of (i) the Borrowing Limit and (ii) the Swingline Commitment.

(b) Refunding .

(i) Swingline Loans shall be refunded by the Lenders on demand by the Swingline Lender. Such refundings shall be made by the Lenders in accordance with their respective Commitment Percentages and shall thereafter be reflected as Revolving Credit Loans of the Lenders on the books and records of the Administrative Agent. Each Lender shall fund its respective Commitment Percentage of Revolving Credit Loans as required to repay Swingline Loans outstanding to the Swingline Lender upon demand by the Swingline Lender but in no event later than 1:00 p.m. on the next succeeding Business Day after such demand is made. No Lender’s obligation to fund its respective Commitment Percentage of a Swingline Loan shall be

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affected by any other Lender’s failure to fund its Commitment Percentage of a Swingline Loan, nor shall any Lender’s Commitment Percentage be increased as a result of any such failure of any other Lender to fund its Commitment Percentage of a Swingline Loan.

(ii) The Borrower shall pay to the Swingline Lender on demand the amount of such Swingline Loans to the extent amounts received from the Lenders are not sufficient to repay in full the outstanding Swingline Loans requested or required to be refunded. In addition, the Borrower hereby authorizes the Administrative Agent to charge any account maintained by the Borrower with the Swingline Lender (up to the amount available therein) in order to immediately pay the Swingline Lender the amount of such Swingline Loans to the extent amounts received from the Lenders are not sufficient to repay in full the outstanding Swingline Loans requested or required to be refunded. If any portion of any such amount paid to the Swingline Lender shall be recovered by or on behalf of the Borrower from the Swingline Lender in bankruptcy or otherwise, the loss of the amount so recovered shall be ratably shared among all the Lenders in accordance with their respective Commitment Percentages (unless the amounts so recovered by or on behalf of the Borrower pertain to a Swingline Loan extended after the occurrence and during the continuance of an Event of Default of which the Administrative Agent has received notice in the manner required pursuant to Section 12.3 and which such Event of Default has not been waived by the Required Lenders, the Required Agreement Lenders or the Lenders, as applicable).

(iii) Each Lender acknowledges and agrees that its obligation to refund Swingline Loans in accordance with the terms of this Section is absolute and unconditional and shall not be affected by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions set forth in Article V . Further, each Lender agrees and acknowledges that if prior to the refunding of any outstanding Swingline Loans pursuant to this Section, one of the events described in Section 11.1(i) or (j)  shall have occurred, each Lender will, on the date the applicable Revolving Credit Loan would have been made, purchase an undivided participating interest in the Swingline Loan to be refunded in an amount equal to its Commitment Percentage of the aggregate amount of such Swingline Loan. Each Lender will immediately transfer to the Swingline Lender, in immediately available funds, the amount of its participation and upon receipt thereof the Swingline Lender will deliver to such Lender a certificate evidencing such participation dated the date of receipt of such funds and for such amount. Whenever, at any time after the Swingline Lender has received from any Lender such Lender’s participating interest in a Swingline Loan, the Swingline Lender receives any payment on account thereof, the Swingline Lender will distribute to such Lender its participating interest in such amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s participating interest was outstanding and funded).

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

(a) Requests for Borrowing . The Original Borrower shall give the Administrative Agent irrevocable prior written notice substantially in the form of Exhibit B (a “ Notice of Borrowing ”) not later than 12:00 p.m. (i) on the same Business Day as each Base Rate Loan (including each Swingline Loan) and (ii) at least three (3) Business Days before each LIBOR Rate Loan, of its intention to borrow, specifying (A) the date of such borrowing, which shall be a

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Business Day, (B) the amount of such borrowing, which shall be, (x) with respect to Base Rate Loans (other than Swingline Loans) in an aggregate principal amount of $1,000,000 or a whole multiple of $500,000 in excess thereof, (y) with respect to LIBOR Rate Loans in an aggregate principal amount of $3,000,000 or a whole multiple of $1,000,000 in excess thereof and (z) with respect to Swingline Loans in an aggregate principal amount of $100,000 or a whole multiple of $100,000 in excess thereof, (C) whether such Loan is to be a Revolving Credit Loan or Swingline Loan, (D) in the case of a Revolving Credit Loan whether the Loans are to be LIBOR Rate Loans or Base Rate Loans, and (E) in the case of a LIBOR Rate Loan, the duration of the Interest Period applicable thereto. A Notice of Borrowing received after 12:00 p.m. shall be deemed received on the next Business Day. The Administrative Agent shall promptly notify the Lenders of each Notice of Borrowing.

(b) Disbursement of Revolving Credit and Swingline Loans . Not later than 2:00 p.m. on the proposed borrowing date, (i) each Lender will make available to the Administrative Agent, for the account of the Original Borrower, at the Administrative Agent’s Office in funds immediately available to the Administrative Agent, such Lender’s Commitment Percentage of the Revolving Credit Loans to be made on such borrowing date and (ii) the Swingline Lender will make available to the Administrative Agent, for the account of the Original Borrower, at the Administrative Agent’s Office in funds immediately available to the Administrative Agent, the Swingline Loans to be made on such borrowing date. The Borrower hereby irrevocably authorizes the Administrative Agent to disburse the proceeds of each borrowing requested pursuant to this Section in immediately available funds by crediting or wiring such proceeds to the deposit account of the Original Borrower identified in the most recent notice substantially in the form of Exhibit C (a “ Notice of Account Designation ”) delivered by the Original Borrower to the Administrative Agent or as may be otherwise agreed upon by the Original Borrower and the Administrative Agent from time to time. Subject to Section 4.7 hereof, the Administrative Agent shall not be obligated to disburse the portion of the proceeds of any Revolving Credit Loan requested pursuant to this Section to the extent that any Lender has not made available to the Administrative Agent its Commitment Percentage of such Loan. Revolving Credit Loans to be made for the purpose of refunding Swingline Loans shall be made by the Lenders as provided in Section 2.2(b) .

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

(a) Repayment on Maturity Date . The Borrower hereby agrees to repay the outstanding principal amount of (i) all Revolving Credit Loans in full on the Maturity Date, and (ii) all Swingline Loans in accordance with Section 2.2(b) , together, in each case, with all accrued but unpaid interest thereon.

(b) Mandatory Prepayments .

(i) Borrowing Limit . If at any time the outstanding principal amount of all Revolving Credit Loans plus the sum of all outstanding Swingline Loans and L/C Obligations exceeds the Borrowing Limit, the Borrower agrees to prepay (A) if such excess results from a change to the Asset Coverage Amount, within three (3) Business Days following the delivery of the applicable financial statements resulting in such

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change or (B) in any other circumstance, immediately upon notice from the Administrative Agent, by payment to the Administrative Agent for the account of the Lenders, Extensions of Credit in an amount equal to such excess with each such repayment applied first to the principal amount of outstanding Swingline Loans, second to the principal amount of outstanding Revolving Credit Loans and third , with respect to any Letters of Credit then outstanding, a payment of cash collateral into a cash collateral account opened by the Administrative Agent, for the benefit of the Lenders in an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit (such cash collateral to be applied in accordance with Section 11.2(b) ).

(ii) Excess L/C Obligations . If at any time the outstanding amount of all L/C Obligations exceeds the L/C Commitment, then, in each such case, the Borrower shall promptly make a payment of cash collateral into a cash collateral account opened by the Administrative Agent, for the benefit of itself and the Lenders, in an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit (such cash collateral to be applied in accordance with Section 11.2(b) ).

(c) Optional Prepayments . The Borrower may at any time and from time to time prepay Revolving Credit Loans and Swingline Loans, in whole or in part, with irrevocable prior written notice to the Administrative Agent substantially in the form of Exhibit D (a “ Notice of Prepayment ”) given not later than 12:00 p.m. (i) on the same Business Day as the prepayment of each Base Rate Loan and each Swingline Loan and (ii) at least three (3) Business Days before the prepayment of each LIBOR Rate Loan, specifying the date and amount of prepayment and whether the prepayment is of LIBOR Rate Loans, Base Rate Loans, Swingline Loans or a combination thereof, and, if of a combination thereof, the amount allocable to each. Upon receipt of such notice, the Administrative Agent shall promptly notify each Lender. If any such notice is given, the amount specified in such notice shall be due and payable on the date set forth in such notice. Partial prepayments shall be in an aggregate amount of $1,000,000 or a whole multiple of $500,000 in excess thereof with respect to Base Rate Loans (other than Swingline Loans), $3,000,000 or a whole multiple of $1,000,000 in excess thereof with respect to LIBOR Rate Loans and $100,000 or a whole multiple of $100,000 in excess thereof with respect to Swingline Loans. A Notice of Prepayment received after 12:00 p.m. shall be deemed received on the next Business Day.

(d) Limitation on Prepayment of LIBOR Rate Loans . The Borrower may not prepay any LIBOR Rate Loan on any day other than on the last day of the Interest Period applicable thereto unless such prepayment is accompanied by any amount required to be paid pursuant to Section 4.9 hereof.

(e) Hedging Agreements . No repayment or prepayment pursuant to this Section shall affect any of the Borrower’s obligations under any Hedging Agreement.

SECTION 2.5 Permanent Reduction of the Commitment .

(a) Voluntary Reduction . The Borrower shall have the right at any time and from time to time, upon at least five (5) Business Days prior written notice to the Administrative Agent, to permanently reduce, without premium or penalty, (i) the entire Commitment at any

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time or (ii) portions of the Commitment, from time to time, in an aggregate principal amount not less than $5,000,000 or any whole multiple of $5,000,000 in excess thereof. Any reduction of the Commitment shall be applied to the Commitment of each Lender according to its Commitment Percentage. All commitment fees accrued until the effective date of any termination of the Commitment shall be paid on the effective date of such termination.

(b) Corresponding Payment . Each permanent reduction permitted pursuant to this Section shall be accompanied by a payment of principal sufficient to reduce the aggregate outstanding Revolving Credit Loans, Swingline Loans and L/C Obligations, as applicable, after such reduction to the Commitment as so reduced and if the Commitment as so reduced is less than the aggregate amount of all outstanding Letters of Credit, the Borrower shall be required to deposit cash collateral in a cash collateral account opened by the Administrative Agent in an amount equal to the aggregate then undrawn and unexpired amount of such Letters of Credit. Such cash collateral shall be applied in accordance with Section 11.2(b) . Any reduction of the Commitment to zero shall be accompanied by payment of all outstanding Revolving Credit Loans and Swingline Loans (and furnishing of cash collateral for all L/C Obligations) and shall result in the termination of the Commitment and the Credit Facility. Such cash collateral shall be applied in accordance with Section 11.2(b) . If the reduction of the Commitment requires the repayment of any LIBOR Rate Loan, such repayment shall be accompanied by any amount required to be paid pursuant to Section 4.9 hereof.

SECTION 2.6 Termination of Credit Facility . The Credit Facility shall terminate on the Maturity Date.

ARTICLE III

LETTER OF CREDIT FACILITY

SECTION 3.1 L/C Commitment . Subject to the terms and conditions hereof, each Issuing Lender, in reliance on the agreements of the other Lenders set forth in Section 3.4(a) , agrees to issue standby letters of credit (“ Letters of Credit ”) for the account of the Borrower on any Business Day from the Closing Date to but not including the fifth (5 ^th ) Business Day prior to the Maturity Date in such form as may be approved from time to time by the applicable Issuing Lender; provided , that no Issuing Lender shall have any obligation to issue any Letter of Credit if, after giving effect to such issuance, (a) the aggregate amount of L/C Obligations would exceed the L/C Commitment or (b) the aggregate amount of L/C Obligations would exceed the Borrowing Limit. Each Letter of Credit shall (i) be denominated in Dollars in a minimum amount of $100,000 (or such lesser amount as agreed to by the applicable Issuing Lender), (ii) be a standby letter of credit issued to support obligations of the Borrower or any of its Subsidiaries, contingent or otherwise, (iii) expire on a date that is no later than the earlier of (A) twelve (12) or thirteen (13) months (as requested by the Original Borrower) after the date of issuance or last renewal of such Letter of Credit, and (B) the fifth (5 ^th ) Business Day prior to the Maturity Date and (iv) be subject to ISP98 and, to the extent not inconsistent therewith, the laws of the State of New York. No Issuing Lender shall at any time be obligated to issue any Letter of Credit hereunder if such issuance would conflict with, or cause such Issuing Lender or any L/C Participant to exceed any limits imposed by, any Applicable Law. References herein to “issue” and derivations thereof with respect to Letters of Credit shall also include extensions or

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modifications of any outstanding Letters of Credit, unless the context otherwise requires. As of the Closing Date, each of the Existing Letters of Credit shall constitute, for all purposes of this Agreement and the other Loan Documents, a Letter of Credit issued and outstanding hereunder.

SECTION 3.2 Procedure for Issuance of Letters of Credit . The Borrower may from time to time request that an Issuing Lender issue a Letter of Credit by delivering to such Issuing Lender at such Issuing Lender’s Lending Office and to the Administrative Agent at the Administrative Agent’s Office a Letter of Credit Application therefor, completed to the reasonable satisfaction of the applicable Issuing Lender and the Administrative Agent, and such other certificates, documents and other papers and information as such Issuing Lender and the Administrative Agent may reasonably request (the “ L/C Supporting Documentation ”). Upon receipt of any Letter of Credit Application and the L/C Supporting Documentation, the applicable Issuing Lender shall process such Letter of Credit Application and the L/C Supporting Documentation delivered to it in connection therewith in accordance with its customary procedures and shall, after approving the same and receiving confirmation from the Administrative Agent that sufficient availability exists under the Credit Facility for the issuance of such Letter of Credit, subject to Section 3.1 and Article V , promptly issue the Letter of Credit requested thereby (but in no event shall the applicable Issuing Lender be required to issue any Letter of Credit earlier than three (3) Business Days after its receipt of the Letter of Credit Application therefor and the L/C Supporting Documentation relating thereto) by issuing the original of such Letter of Credit to the beneficiary thereof or as otherwise may be agreed by the applicable Issuing Lender and the Original Borrower. The applicable Issuing Lender shall promptly furnish to the Original Borrower and the Administrative Agent a copy of such Letter of Credit and the Administrative Agent shall promptly notify each Lender of the issuance of such Letter of Credit and, upon request by any Lender, furnish to such Lender a copy of such Letter of Credit and the amount of such Lender’s participation therein.

SECTION 3.3 Commissions and Other Charges .

(a) Letter of Credit Commissions . The Borrower shall pay to the Administrative Agent, for the account of the each applicable Issuing Lender and the L/C Participants, a letter of credit commission with respect to each Letter of Credit in an amount equal to the face amount of such Letter of Credit (as such amount may be reduced by (i) any permanent reduction of such Letter of Credit or (ii) any amount which is drawn, reimbursed and no longer available under such Letter of Credit) multiplied by the Applicable Margin with respect to LIBOR Rate Loans (determined on a per annum basis). Such commission shall be payable quarterly in arrears on the last Business Day of each calendar quarter, on the Maturity Date and thereafter on demand of the Administrative Agent. The Administrative Agent shall, promptly following its receipt thereof, distribute to each applicable Issuing Lender and the L/C Participants all commissions received pursuant to this Section in accordance with their respective Commitment Percentages.

(b) Issuance Fee . In addition to the foregoing commission, the Borrower shall pay to the Administrative Agent, for the account of each applicable Issuing Lender, an issuance fee with respect to each Letter of Credit issued by such Issuing Lender in an amount equal to the face amount of such Letter of Credit multiplied by one-eighth of one percent (0.125%) per annum. Such issuance fee shall be payable quarterly in arrears on the last Business Day of each calendar

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quarter commencing with the first such date to occur after the issuance of such Letter of Credit, on the Maturity Date and thereafter on demand of the applicable Issuing Lender.

(c) Other Costs . In addition to the foregoing fees and commissions, the Borrower shall pay or reimburse each Issuing Lender for such normal and customary costs and expenses as are incurred or charged by such Issuing Lender in issuing, effecting payment under, amending or otherwise administering any Letter of Credit.

SECTION 3.4 L/C Participations .

(a) Each Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant, and, to induce such Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from such Issuing Lender, on the terms and conditions hereinafter stated, for such L/C Participant’s own account and risk an undivided interest equal to such L/C Participant’s Commitment Percentage in such Issuing Lender’s obligations and rights under and in respect of each Letter of Credit issued by such Issuing Lender hereunder and the amount of each draft paid by such Issuing Lender thereunder. Each L/C Participant unconditionally and irrevocably agrees with each Issuing Lender that, if a draft is paid under any Letter of Credit issued by such Issuing Lender for which such Issuing Lender is not reimbursed in full by the Borrower through a Revolving Credit Loan or otherwise in accordance with the terms of this Agreement, such L/C Participant shall pay to such Issuing Lender upon demand at such Issuing Lender’s Lending Office an amount equal to such L/C Participant’s Commitment Percentage of the amount of such draft, or any part thereof, which is not so reimbursed.

(b) Upon becoming aware of any amount required to be paid by any L/C Participant to the applicable Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any payment made by such Issuing Lender under any Letter of Credit issued by it, such Issuing Lender shall notify the Administrative Agent and each L/C Participant of the amount and due date of such required payment and such L/C Participant shall pay to such Issuing Lender the amount specified on the applicable due date. If any such amount is paid to such Issuing Lender after the date such payment is due, such L/C Participant shall pay to such Issuing Lender on demand, in addition to such amount, the product of (i) such amount, multiplied by (ii) the daily average Federal Funds Rate as determined by the Administrative Agent during the period from and including the date such payment is due to the date on which such payment is immediately available to such Issuing Lender, multiplied by (iii) a fraction, the numerator of which is the number of days that elapse during such period and the denominator of which is 360. A certificate of the applicable Issuing Lender with respect to any amounts owing under this Section shall be conclusive in the absence of manifest error. With respect to payment to an Issuing Lender of the unreimbursed amounts described in this Section, if the L/C Participants receive notice that any such payment is due (A) prior to 2:00 p.m. on any Business Day, such payment shall be due that Business Day, and (B) after 2:00 p.m. on any Business Day, such payment shall be due on the following Business Day.

(c) Whenever, at any time after the applicable Issuing Lender has made payment under any Letter of Credit and has received from any L/C Participant its Commitment Percentage of such payment in accordance with this Section, such Issuing Lender receives any payment

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related to such Letter of Credit (whether directly from the Borrower or otherwise), or any payment of interest on account thereof, such Issuing Lender will distribute to such L/C Participant its pro rata share thereof; provided , that in the event that any such payment received by such Issuing Lender shall be required to be returned by such Issuing Lender, such L/C Participant shall return to such Issuing Lender the portion thereof previously distributed by such Issuing Lender to it.

SECTION 3.5 Reimbursement Obligation of the Borrower . In the event of any drawing under any Letter of Credit, the Borrower agrees to reimburse (either with the proceeds of a Revolving Credit Loan as provided for in this Section or with funds from other sources), in same day funds, the applicable Issuing Lender on each date on which such Issuing Lender notifies the Original Borrower of the date and amount of a draft paid under any Letter of Credit for the amount of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c) incurred by such Issuing Lender in connection with such payment. The applicable Issuing Lender shall promptly deliver written notice of any drawing under any Letter of Credit issued by such Issuing Lender to the Administrative Agent and the Original Borrower. Unless the Borrower shall immediately notify the applicable Issuing Lender that the Borrower intends to reimburse such Issuing Lender for such drawing from other sources or funds, the Borrower shall be deemed to have timely given a Notice of Borrowing to the Administrative Agent requesting that the Lenders make a Revolving Credit Loan bearing interest at the Base Rate on such date in the amount of (a) such draft so paid and (b) any amounts referred to in Section 3.3(c) incurred by such Issuing Lender in connection with such payment, and the Lenders shall make a Revolving Credit Loan bearing interest at the Base Rate in such amount, the proceeds of which shall be applied to reimburse such Issuing Lender for the amount of the related drawing and costs and expenses. Each Lender acknowledges and agrees that its obligation to fund a Revolving Credit Loan in accordance with this Section to reimburse the applicable Issuing Lender for any draft paid under a Letter of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including, without limitation, non-satisfaction of the conditions set forth in Section 2.3(a) or Article V . If the Borrower has elected to pay the amount of such drawing with funds from other sources and shall fail to reimburse the applicable Issuing Lender as provided above, the unreimbursed amount of such drawing shall bear interest at the rate which would be payable on any outstanding Base Rate Loans which were then overdue from the date such amounts become payable (whether at stated maturity, by acceleration or otherwise) until payment in full.

SECTION 3.6 Obligations Absolute . The Borrower’s obligations under this Article III (including, without limitation, the Reimbursement Obligation) shall be absolute and unconditional under any and all circumstances and irrespective of any set-off, counterclaim or defense to payment which the Borrower may have or have had against any Issuing Lender or any beneficiary of a Letter of Credit or any other Person. The Borrower also agrees that no Issuing Lender nor any L/C Participant shall be responsible for, and the Borrower’s Reimbursement Obligation under Section 3.5 shall not be affected by, among other things, the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee. No Issuing Lender shall be liable for any error, omission,

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interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions caused by the applicable Issuing Lender’s gross negligence or willful misconduct, as determined by a court of competent jurisdiction by final nonappealable judgment. The Borrower agrees that any action taken or omitted by the applicable Issuing Lender under or in connection with any Letter of Credit or the related drafts or documents, if done in the absence of gross negligence or willful misconduct shall be binding on the Borrower and shall not result in any liability of such Issuing Lender or any L/C Participant to the Borrower. The responsibility of the applicable Issuing Lender to the Borrower in connection with any draft presented for payment under any Letter of Credit shall, in addition to any payment obligation expressly provided for in such Letter of Credit, be limited to determining that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment are in conformity with such Letter of Credit.

SECTION 3.7 Effect of Letter of Credit Application . To the extent that any provision of any Letter of Credit Application or L/C Supporting Documentation related to any Letter of Credit is inconsistent with the provisions of this Article III , the provisions of this Article III shall apply.

ARTICLE IV

GENERAL LOAN PROVISIONS

SECTION 4.1 Interest .

(a) Interest Rate Options . Subject to the provisions of this Section, at the election of the Original Borrower, (i) Revolving Credit Loans shall bear interest at (A) the Base Rate plus the Applicable Margin or (B) the LIBOR Rate plus the Applicable Margin and (ii) Swingline Loans shall bear interest at the Base Rate plus the Applicable Margin. The Original Borrower shall select the rate of interest and Interest Period, if any, applicable to any Revolving Credit Loan at the time a Notice of Borrowing is given pursuant to Section 2.3 or at the time a Notice of Conversion/Continuation is given pursuant to Section 4.2 . Any Revolving Credit Loan or any portion thereof as to which the Original Borrower has not duly specified an interest rate as provided herein shall be deemed a Base Rate Loan.

(b) Interest Periods . In connection with each LIBOR Rate Loan, the Original Borrower, by giving notice at the times described in Section 2.3 or 4.2 , as applicable, shall elect an interest period (each, an “ Interest Period ”) to be applicable to such Revolving Credit Loan, which Interest Period shall be a period of one (1), two (2), three (3), or six (6) months; provided that:

(i) the Interest Period shall commence on the date of advance of or conversion to any LIBOR Rate Loan and, in the case of immediately successive Interest Periods, each successive Interest Period shall commence on the date on which the immediately preceding Interest Period expires;

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(ii) if any Interest Period would otherwise expire on a day that is not a Business Day, such Interest Period shall expire on the next succeeding Business Day; provided , that if any Interest Period with respect to a LIBOR Rate Loan would otherwise expire on a day that is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the immediately preceding Business Day;

(iii) any Interest Period with respect to a LIBOR Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the relevant calendar month at the end of such Interest Period;

(iv) no Interest Period shall extend beyond the Maturity Date; and

(v) there shall be no more than eight (8) Interest Periods in effect at any time.

(c) Default Rate . Subject to Section 11.3 , (i) immediately upon the occurrence and during the continuance of an Event of Default under Section 11.1(a) , (b) , (i)  or (j) , or (ii) at the election of the Required Agreement Lenders, upon the occurrence and during the continuance of any other Event of Default, (A) the Borrower shall no longer have the option to request LIBOR Rate Loans, Swingline Loans or Letters of Credit, (B) all outstanding LIBOR Rate Loans shall bear interest at a rate per annum of two percent (2%) in excess of the rate then applicable to LIBOR Rate Loans until the end of the applicable Interest Period and thereafter at a rate equal to two percent (2%) in excess of the rate then applicable to Base Rate Loans, and (C) all outstanding Base Rate Loans and other Obligations ar