Catalyst Paper Clarifies Media Reports on Nature of Recapitalization Process

The proposed recapitalization has the support of the company’s creditors who have been subject to confidentiality agreements. More specifically (a) holders of its 11 percent senior secured notes due 2016 (the Senior Secured Notes) holding approximately US$208.1 million aggregate principal amount of outstanding Senior Secured Notes (representing more than 53.2 percent of the total outstanding Senior Secured Notes) and (b) holders of its 7 3/8 percent senior notes due 2014 (Senior Notes) holding approximately US$54.5 million aggregate principal amount of outstanding Senior Notes (representing more than 21.7 percent of the total outstanding Senior Notes), have signed the Agreement and agreed to vote in favour of and support the recapitalization. The company expects further support of the recapitalization from additional holders of Senior Secured Notes and Senior Notes.