Fraser Papers Granted Further Extension of Creditor Protection

Toronto, Ontario, Canada, 08 July 2010 – Fraser Papers Inc. announced today that the Ontario Superior Court of Justice (Commercial List) has granted a further extension of the initial order under which Fraser Papers, together with its subsidiaries, was granted creditor protection under the Companies’ Creditors Arrangement Act (Canada) (the CCAA). This extension is through 29 October 2010, and was supported by PricewaterhouseCoopers Inc., the court-appointed monitor of the company’s CCAA process.

The company also announced that it has obtained final approval from the court to complete the sale of its paper mill in Gorham, New Hampshire, USA, to an investment fund managed by MerchantBanc, LLC, of Manchester, New Hampshire. Approval also will be sought from the United States Bankruptcy Court for the District of Delaware at a hearing scheduled for 14 July 2010. Fraser Papers expects to complete the sale of the Gorham mill on or before 31 August 2010.