May 15, 2012. /Lesprom Network/. Catalyst Paper announced that it has amended its proposed Plan of Arrangement (the Plan) under the Companies' Creditors Arrangement Act. The Plan as so amended (the Amended Plan) will be considered by Catalyst Paper's secured and unsecured creditors at the meetings scheduled for May 23, 2012 (the Meetings). "We're pleased that over the past weeks, the various stakeholders, advisors and the company have worked diligently to craft an agreement that sizably reduces the company's debt level," said Kevin J. Clarke, President and CEO. "This agreement, with the support of creditors at the meetings on May 23, 2012, will enable Catalyst to emerge from creditor protection with improved liquidity and the capacity to return and sustain normal trade terms for the foreseeable period." The court-appointed monitor (the Monitor) is recommending that creditors vote in favour of the Amended Plan at the Meetings. Catalyst Paper's Board of Directors is unanimously recommending that all holders of First Lien Notes, Unsecured Notes and General Unsecured Claims vote in favour of the Amended Plan at the Meetings. The principal changes to the Plan include: - A reduction of $120 million in the amount of notes to be issued under the Amended Plan so that the total debt reduction under the Amended Plan will be $435 million (rather than the $315 million reduction under the Plan); - the reduction of the principal amount of New First Lien Notes to be issued under the Plan from US$325 million to $250 million; and - the elimination of the New First Lien Coupon Notes to be issued under the Plan (approximately $45 million); - the distribution of 50% of the net proceeds (PREI Proceeds Pool) from the sale of Catalyst Paper's interest in Powell River Energy Inc. and Powell River Energy Limited Partnership (PREI Interest) to Unsecured Creditors who do not receive a Convenience Cash Amount or elect to receive equity; - 100% of the New Common Shares to be issued to holders of the First Lien Notes subject to the ability for Unsecured Creditors to elect (Equity Election) to acquire up to 600,000 New Common Shares (4%) rather than receive cash from the PREI Proceeds Pool or the Maximum Convenience Claims Pool; and - the elimination of the issuance of the Warrants under the Plan. There were no changes to the provisions of the Plan relating to the payment of Convenience Cash Amounts. Catalyst Paper manufactures diverse specialty mechanical printing papers, newsprint and pulp.