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Cascades
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Kingsey Falls, Québec, Canada, 13 February 2008 — Cascades Inc. (CAS on the Toronto Stock Exchange) has entered into an agreement to amend its existing bank credit agreement. Under the terms of the amendment the existing financial covenants -- the maximum funded debt to capitalization ratio of 65% and the minimum interest coverage ratio of 2.25x -- will remain unchanged until maturity in October 2012.

In consideration of this covenant extension, the variable interest rate applicable to borrowings outstanding was increased by 200 basis points. The amendment also cancels the unsecured revolving credit facility in the amount of CAD 100 million, which was originally scheduled to terminate in June 2009.

The amount of the company's secured revolving credit and term facilities (CAD 750 million and CAD 100 million, respectively) and their maturity dates (December 2011 and October 2012, respectively) stay unchanged. In addition, the amendment should be implemented in the coming weeks.

"This measure constitutes one more step in our ongoing efforts to improve financial flexibility," said Alain Lemaire, president and chief executive officer. "While we are currently within the requirements of our bank credit agreement and expect to remain so, we believe it is appropriate to pursue this amendment given the volatile economic environment. Moreover, despite the interest rate adjustment, the cost of borrowings under our facilities is lower than when we initially entered into the agreement. With cash availability standing at approximately CAD 300 million, no debt maturity until the end of 2011 and a more favorable cost environment, I am confident that we have the resources necessary to continue developing Cascades through these uncertain times.”

Founded in 1964, Cascades produces, converts, and markets packaging and tissue products composed mainly of recycled fibers. Cascades employs close to 13,000 employees who work in more than 100 modern and flexible production units located in North America and Europe. Cascades' management philosophy, its 45 years of experience in recycling, and its continued efforts in research and development are strengths that enable the company to create new products for its customers. The Cascades' shares trade on the Toronto Stock Exchange under the ticker symbol CAS.
 


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