Mar 24, 2008. /Lesprom.com/. AbitibiBowater announced that it has entered into a definitive agreement with Fairfax Financial Holdings Limited for an investment by Fairfax and its designated subsidiaries in AbitibiBowater of $350 million in the form of unregistered convertible debentures. This transaction, which is part of the Company's previously announced $1.4 billion refinancing plan, is expected to address upcoming debt maturities and general liquidity needs of its Abitibi-Consolidated Inc. subsidiary. There is no financing condition to the obligations of Fairfax to fund the transaction. The $350 million of convertible debentures is convertible into AbitibiBowater common shares at $10.00 per share, carries an 8% cash coupon, has an ability for the Company to pay interest in the form of additional "pay-in-kind" debentures at a rate of 10%, and has a subsidiary guarantee. The debentures have a maturity of 5 years and are non-callable. The transaction, which is scheduled to close on March 31, 2008, is subject to certain conditions, including the receipt of various lender consents and the closing of the other components of the Company's $1.4 billion refinancing plan. Under the Fairfax Purchase Agreement, Fairfax will have the right to appoint two directors to the Board of Directors of the Company. AbitibiBowater produces a wide range of newsprint, commercial printing papers, market pulp and wood products.