Arbec Forest Products Inc. announces closing of credit facility

Mar 15, 2006. /Lesprom Network/. Arbec Forest Products Inc. announced on Tuesday, March 14 the closing of a credit facility with Jolina Capital Inc. as lender, the proceeds of which will be used by Arbec to redeem in full, on March 15, 2006, the outstanding CAD 60 million 9% senior notes series "A" due March 15, 2009 and CAD 40 million 7.5% senior convertible notes series "B" due September 15, 2008, in accordance with the terms of such notes. The credit facility will have a maturity date of September 29, 2009, and borrowings under such facility will bear interest at a rate of 8% per annum. Jolina is a company controlled by Mr. Emanuele (Lino) Saputo, a significant shareholder of Arbec who owns or controls 36.3% of all outstanding shares of Arbec. Mr. Saputo is also a director of the company. Jolina is also the holder of approximately CAD 68 million aggregate principal amount of Arbec's senior notes series "A" and senior convertible notes series "B". Arbec manufactures softwood lumber and owns a pulp mill now rented by virtue of a long-term agreement. Arbec carries on business through mills located in Port-Cartier and in the Peribonka area.