DATED 29 SEPTEMBER, 2008 M-REAL CORPORATION AND OTHERS and SAPPI LIMITED AND OTHERS

EXHIBIT 4.15

DATED 29 SEPTEMBER, 2008

M-REAL CORPORATION AND OTHERS

and

SAPPI LIMITED AND OTHERS

MASTER BUSINESS AND SHARE SALE AND PURCHASE AGREEMENT

relating to the sale and purchase of the
 M-real Graphic Paper Business

Xxxxxxxxx and May
Xxx Xxxxxxx Xxx
Xxxxxx XX0X 0XX
(ACC/JRYC)

CA081780036

CONTENTS

		Page
1.	INTERPRETATION	1
2.	SALE AND PURCHASE OF THE BUSINESS ASSETS	2
3.	SALE AND PURCHASE OF THE SHARES AND RECEIVABLES	3
4.	CONDITIONS	4
5.	TERMINATION RIGHTS	6
6.	CONDUCT OF BUSINESS BEFORE COMPLETION	7
7.	CONSIDERATION	11
8.	COMPLETION STATEMENTS AND ADJUSTMENTS	13
9.	TRANSFER OF RISK	15
10.	COMPLETION	15
11.	XXX	00
00.	ACTION AFTER COMPLETION	17
13.	THIRD PARTY CONSENTS FOR THE SALE OF BUSINESS ASSETS	18
14.	TRANSFER OF BUSINESS CONTRACTS AND LICENCES	18
15.	ASSUMED LIABILITIES AND ASSURANCES	21
16.	BUSINESS RECEIVABLES	22
17.	SELLERS’ WARRANTIES AND PURCHASERS’ REMEDIES	24
18.	PURCHASERS’ WARRANTIES	26
19.	SELLERS’ UNDERTAKINGS	27
20.	PURCHASERS’ UNDERTAKINGS	30
21.	RESTRICTIONS ON SELLERS’ BUSINESS ACTIVITIES	32
22.	NON-SOLICITATION	33

23.	EMPLOYEES	34
24.	FURTHER UNDERTAKINGS	36
25.	SELLERS’ MARKS	37
26.	INTELLECTUAL PROPERTY	37
27.	INSURANCE	39
28.	BOOKS AND RECORDS	39
29.	SET-OFF	40
30.	EFFECT OF COMPLETION	40
31.	REMEDIES AND WAIVERS	40
32.	ASSIGNMENT	40
33.	FURTHER ASSURANCE	40
34.	ENTIRE AGREEMENT	41
35.	RIGHTS OF THIRD PARTIES	41
36.	NOTICES	41
37.	ANNOUNCEMENTS	43
38.	CONFIDENTIALITY	43
39.	COSTS AND EXPENSES	44
40.	INDUCEMENT FEE	45
41.	COUNTERPARTS	45
42.	INVALIDITY	45
43.	HUSUM PM8 COATER CALL OPTION	45
44.	SOUTH AFRICA OPTION	46
45.	XXXXXX PROPERTY OPTION	47
46.	XXXXXXXXX	00
00.	INDEMNITIES ON AN AFTER TAX-BASIS	51

48.	LANGUAGE	51
49.	GOVERNING LAW	51
50.	JURISDICTION	52
51.	AGENTS FOR SERVICE	52
SCHEDULE 1 (INTERPRETATION)		54
SCHEDULE 2 (CONDITIONS TO COMPLETION)		76
SCHEDULE 3 (COMPLETION ARRANGEMENTS)		78
SCHEDULE 4 (THE WARRANTIES)		85
SCHEDULE 5 (LIMITATIONS ON LIABILITY)		101
SCHEDULE 6 (COMPLETION STATEMENTS)		107
SCHEDULE 7 (THE GROUP)		120
SCHEDULE 8 (SHARES)		124
SCHEDULE 9 (THE PROPERTIES)		125
SCHEDULE 10 (MILL BUSINESS FIXED ASSET REGISTER))		143
SCHEDULE 11 (INTELLECTUAL PROPERTY)		144
SCHEDULE 12 (EMPLOYEES)		161
SCHEDULE 13 (RELEVANT SELLERS AND RELEVANT PURCHASERS)		162
SCHEDULE 14 (TAX INDEMNITY)		164
SCHEDULE 15 (ENVIRONMENTAL INDEMNITY))		179
SCHEDULE 16 (ANTI DILUTION PROVISIONS)		186

Attachments

Attachment 1 Accounts

Attachment 2	Accounting Principles and Policies of M-real
Attachment 3	Carve-Out Accounts
Attachment 4	Press Announcement
Attachment 5	Format of Completion Statements
Attachment 6	Data Room List
Attachment 7	Disclosure Letter
Attachment 8	Business Employees at the close of business on 26 September, 2008
Attachment 9	Business Intellectual Property Assignments
Attachment 10	INTENTIONALLY LEFT BLANK
Attachment 11	Transitional Services Term Sheet
Attachment 12	Lock-Up Agreement
Attachment 13	Long-term Wood Supply Agreement
Attachment 14	Long-term Pulp Supply Agreements
Attachment 15	Husum Mill PM8 Exclusive Marketing Agreement
Attachment 16	Äänekoski PM2 Exclusive Marketing Agreement
Attachment 17	Long-term Energy Agreements
Attachment 18	Business Properties Transfer Deed
Attachment 19	Xxxxxx PM2 Property lease
Xxxxxxxxxx 00	Xxxxxx Xxxxx Transfer Agreement
Attachment 21	Kirkniemi Asset Transfer Agreement
Attachment 22	German Share Transfer Agreement
Attachment 23	Hallein Coater Asset Sale and Transfer Agreement
Attachment 24	Vendor Loans
Attachment 25	M-real Vendor Loan Note

Attachment 26	Commercial Arrangements Term Sheet
Attachment 27	Diverse Energy Issues Term Sheet
Attachment 28	Thosca-Xxxx Option Letter
Attachment 29	Standby Underwriting Agreement
Attachment 30	Allocation of Obligations Table
Attachment 31	Mill Business Fixed Asset Register
Attachment 32	Mill Business Vehicles
Attachment 33	CHP Outstanding Lease Payments Schedule

THIS MASTER BUSINESS AND SHARE SALE AND PURCHASE AGREEMENT
is made this 29th DAY OF SEPTEMBER, 2008

BETWEEN:

1. M-REAL CORPORATION, a company incorporated in Finland whose registered office is at Xxxxxxxxxxxxx 0, 00000 Xxxxx, Xxxxxxx (P.O. Xxx 00, XXX-00000 Xxxxx, Xxxxxxx) (registered in Finland with No. 0635366-7) (“M-real”);

AND

2. EACH OF THE SHARE SELLERS AND BUSINESS SELLERS whose names are set out in Schedule 13 (together with M-real, the “Relevant Sellers” or “Sellers”);

AND

3. SAPPI LIMITED, a company incorporated in the Republic of South Africa whose registered office is at Sappi House, 00 Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx, Xxxxx Xxxxxx (“Sappi” or “the Purchaser”);

AND

4. EACH OF THE SHARE PURCHASERS AND BUSINESS PURCHASERS whose names are set out in Schedule 13 (together with Sappi, the “Relevant Purchasers” or “Purchasers”).

WHEREAS:

(A) The Relevant Sellers (each as to the Shares or any of the Business Assets, as the case may be, set out against its name in Schedule 13) have agreed to sell the Graphic Paper Business and to assume the obligations imposed on the Relevant Sellers under this Agreement.

(B) The Relevant Purchasers (each as to the Shares or any of the Business Assets, as the case may be, set out against its name in Schedule 13) have agreed to purchase the Graphic Paper Business and to assume the obligations imposed on the Relevant Purchasers under this Agreement.

(C) Certain Relevant Sellers and certain Relevant Purchasers have agreed to enter into certain of the Transaction Documents as set out in the Attachments to this Agreement.

(D) M-real and Sappi have a definitive plan to sell the Coaters.

WHEREBY IT IS AGREED as follows:-

1. INTERPRETATION

(A) Certain words and expressions used in this Agreement are defined in Schedule 1.

(B) The Schedules and Attachments form part of this Agreement and shall have the same force and effect as if set out in the body of this Agreement and any reference to this Agreement shall include the Schedules and Attachments.

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2. SALE AND PURCHASE OF BUSINESS ASSETS

2.1 On the terms of, and subject to the conditions, set out in this Agreement, the Relevant Sellers shall sell and the Relevant Purchasers shall purchase the Business comprising the assets listed below as a going concern as at, and with effect from, the Completion Date:

(i) the Business Goodwill;

(ii) the Business Plant and Machinery;

(iii) the Business Stocks;

(iv) the Business Receivables;

(v) the benefit (subject to the burden) of the Business Contracts;

(vi) subject to clause 2.5, the Business Intellectual Property;

(vii) the Business Properties;

(viii) without prejudice to clause 28 , the Business Information and Books and Records;

(ix) the benefit (so far as the same can lawfully be assigned or transferred to the Relevant Purchasers) of the Claims (less any costs incurred by the Relevant Seller in effecting such assignment or transfer (including, without limitation, any increases in premiums or the loss of any benefit in relation to any insurance arrangement of any member of the Sellers’ Group)); and

(x) any monetary amounts received by the Relevant Sellers (so far as the same can lawfully be assigned or transferred to the Relevant Purchasers) of any claim under an insurance policy (less any costs incurred by the Relevant Seller in effecting such assignment or transfer (including, without limitation, any increases in premiums or the loss of any benefit in relation to any insurance arrangement of any member of the Sellers’ Group))  to the extent such claim relates to any Business Asset or Assumed Liability, but not to the extent that any such claim relates to any Losses which have been made good prior to Completion or are recoverable under an indemnity by the Relevant Sellers to the Relevant Purchasers under this Agreement,

(together the “Business Assets”), but excluding the following assets (the “Excluded Assets”):

(a) the Xxxxxx PM2;

(b) any element of the Business Assets set out in this clause 2.1 (i), (iii), (iv), (v), (vi), (viii), (ix) and (x) in each case that relates to the Relevant Sellers’ business and operation in South Africa;

(c) cash in hand or cash at the bank used in the Business, including all cash pooling arrangements as shown in the cash book of M-real or any other member of the Sellers’ Group, prepared in accordance with normal cut-off procedures as at the close of business on the Completion Date;

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(d) amounts recoverable in respect of Taxation (including, for the avoidance of doubt, all sums due or recoverable (whether by way of credit, deduction, refund or otherwise) as relate to Finnish VAT in connection with the supply of goods and services or the purchase of raw materials and other goods and services of the Mill Business) attributable to periods of time ending on or before Completion, or in respect of any acts, events or transactions occurring on or before Completion;

(e) the benefit of any insurance policy of the Seller or any other member of the Sellers’ Group relating to any member of the Group, the Business or any of the Business Assets or Business Employees;

(f) the Sellers’ Marks; and

(g) without prejudice to the Thosca Xxxx Option Letter, any shares owned by any member of the Sellers’ Group.

2.2 As at, and with effect from, the Completion Date, the Relevant Purchasers will assume the Assumed Liabilities.

2.3 M-real has the right to transfer, or the right to procure that the Relevant Sellers transfer the legal and beneficial title to the Business Assets and, except as provided for in Schedule 9, sell or procure the sale of the Business Assets free from Encumbrances (excluding the Business Intellectual Property which M-real sells or procures the sale of free from all options, charges and liens) and all other rights exercisable by or claims of third parties.

2.4 Notwithstanding any other provisions of this Agreement, each member of the Sellers’ Group shall retain its rights, title and interest in and to, and no member of the Purchaser’s Group shall pursuant to this Agreement obtain any rights, title or interest in or to, the Excluded Assets.

2.5 Clause 2.1 shall operate as an assignment of such of the Business Intellectual Property as is not the subject of a registration or an application for registration (including, for the avoidance of doubt, the unregistered marks “MEGA”, “EUROBULK”, “GALERIE BRITE”, “GALERIE LITE”, “ALLEGRO” and “FURIOSO”) with effect from Completion.  All Business Intellectual Property which is registered or which is the subject of an application for registration shall be assigned to the Relevant Purchasers pursuant to the Business Intellectual Property Assignments.

2.6 The Law of Property (Miscellaneous Provisions) Xxx 0000 shall not apply for the purposes of clause 2.1.

3. SALE AND PURCHASE OF THE SHARES AND RECEIVABLES

3.1 On the terms of, and subject to the conditions set out in, this Agreement (including, for the avoidance of doubt, clause 4.6), Deutsche Holding shall sell or procure the sale and the Relevant Purchaser shall purchase or procure the purchase of, the legal and beneficial interest in the German Shares as at and with effect from Completion, together with all rights attached or accruing to them at Completion.

3.2 On the terms of, and subject to the conditions set out in, this Agreement, NL Holding shall sell or procure the sale and the Relevant Purchaser shall purchase or procure the purchase of, the legal

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and beneficial interest in the Biberist Shares as at and with effect from Completion, together with all rights attached or accruing to them at Completion.

3.3 The Shares shall be sold free from all Encumbrances and all other rights exercisable by or claims of third parties.

3.4 The Relevant Sellers shall procure that on or prior to Completion any and all rights of pre-emption over the Shares are waived irrevocably by the persons entitled thereto.

3.5 Against payment of an amount equal to the Estimated Inter-Group Debt at the Completion Time, and subject to any relevant adjustments in accordance with clause 8 only, each Relevant Seller shall sell and assign, and M-real shall procure that any relevant member of the Sellers’ Group who is not a Relevant Seller shall sell and assign, the legal and beneficial interest in the receivables which comprise Inter-Group Debt to the Relevant Purchasers who shall purchase or procure the purchase of such receivables.

3.6 The Law of Property (Miscellaneous Provisions) Xxx 0000 shall not apply for the purposes of this clause 3.

4. CONDITIONS

4.1 The obligations of each party under this Agreement (other than those contained in this clause 4, clause 6, clauses 20.7 to 20.8, clauses 34 to 42 and clauses 46 to 51 which are unconditional) are conditional in all respects upon the conditions set out in Schedule 2 being satisfied or waived in accordance with this Agreement.

4.2 Without prejudice to the generality of clause 4.3, Sappi undertakes and agrees with the Relevant Sellers that:

(i) it will post a circular to the shareholders of Sappi (the “Sappi Circular”) as soon as reasonably practicable and in any event within 14 days of the date of this Agreement; and

(ii) the Sappi Circular will contain:

(a) a notice duly convening a general meeting of Sappi referred to in paragraph 1 of Schedule 2, such notice to include the resolution(s) substantially in the form referred to in paragraph 1 of Schedule 2;

(b) (subject to the fiduciary duties of the directors of Sappi) a recommendation from the directors of Sappi to its members to vote in favour the resolution(s) substantially in the form referred to in paragraph 1 of Schedule 2; and

(c) to the extent it has obtained and can lawfully disclose the same, details of the undertakings or other commitments of the major shareholders of Sappi who have committed to subscribe for Sappi Shares in, or otherwise support, the Rights Issue.

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4.3 Each of the Relevant Sellers and the Relevant Purchasers will use all reasonable endeavours to fulfil or procure the fulfilment of the conditions set out in Schedule 2 as soon as possible and in any event by the Termination Date. M-real (acting on behalf of the Sellers) and Sappi (acting on behalf of the Purchasers) shall, on becoming aware, immediately give written notice to the other of:

(i) the fulfilment of each and any of the conditions set out in Schedule 2 of this Agreement; and

(ii) any circumstances which could reasonably be expected to prevent any of the conditions set out in Schedule 2 from being satisfied or which could reasonably be expected to delay the fulfilment of such conditions.

4.4 For the purpose of satisfying the conditions set out in paragraphs 2 and 3 of Schedule 2, the reasonable endeavours referred to in clause 4.3 shall include the making of the requisite filings as soon as is practicable to the European Commission and Relevant Competition Authorities in the United States and Turkey and in this respect shall include the co-operation between M-real, on behalf of the Sellers’ Group, and Sappi, on behalf of the Purchaser’s Group, in any process involving the European Commission or any relevant Competition Authority in the United States or Turkey, such co-operation shall include, without limitation (subject to appropriate protection in respect of confidential information), the provision of information, the communication of documents and the submission of arguments in good time.

4.5 Without prejudice to the generality of the foregoing each of M-real, on behalf of the Sellers’ Group, and Sappi, on behalf of the Purchaser’s Group, shall in connection with the preparation and submission of Submissions to the European Commission or any relevant Competition Authority in the United States or Turkey:

(i) consult with each other as to the form and content of any Submissions;

(ii) procure that relevant drafts or re-drafts of any Submissions are provided as soon as practicable and in sufficient time to allow the other party and its advisers to review and provide comments on such drafts and re-drafts;

(iii) take account of the reasonable comments of the other party and its advisers on such drafts and re-drafts;

(iv) disclose promptly to the other party copies of all correspondence from and details of any discussions with the European Commission or any relevant Competition Authority which has been provided to the Sellers’ Group or the Purchaser’s Group and/or their respective advisers;

(v) procure that the other party and/or its advisers are given a reasonable opportunity to attend all meetings or hearings and to participate in all significant discussions with the European Commission or any relevant Competition Authority;

(vi) regularly review with each other the progress of any notifications or filings; and

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(vii) keep the other party informed promptly of any developments which are material or potentially material to the obtaining of the approvals, referred to in paragraphs 2 and 3 of Schedule 2,

PROVIDED THAT where a Submission includes information which is reasonably considered by a party to be competitively sensitive that party may at its option provide such information only to the other party’s legal advisers on an external counsel basis.

4.6 After M-real has received notice of the fulfilment or waiver of each of the conditions set out in Schedule 2, M-real shall cause Deutsche Holding to take all reasonably necessary steps to ensure that the fiscal year of Stockstadt GmbH is shortened, if the Completion Date falls prior to or after 31 December, 2008, such that it ends on the Completion Date. M-real shall further procure and take all necessary steps to ensure that the existing Profit and Loss Pooling Agreement existing between Deutsche Holding and Stockstadt GmbH is terminated with legal effect as of the end of the Completion Date, provided, however, that (i) Deutsche Holding shall be entitled to receive the profit, if any, under the Profit and Loss Pooling Agreement for the period from 1 January, 2008 until the end of the Completion Date and the respective liability, if any, of Stockstadt GmbH shall be treated as a debt owed by it to Deutsche Holding (such debt being, for the avoidance of doubt, within the definition of Inter-Group Debt) and (ii) Stockstadt GmbH shall be entitled to any claim for compensation of loss, if any, under the Profit and Loss Pooling Agreement for the period from 1 January, 2008 until the end of the Completion Date and the respective claim, if any, of Stockstadt GmbH shall be treated as a debt owed to it by Deutsche Holding (such debt being, for the avoidance of doubt, within the definition of Inter-Group Receivables), it being understood that the liability or claim of Stockstadt GmbH, as the case may be, shall be determined in accordance with the Stockstadt Statutory Accounts and included in the Completion Statements with such amount.

4.7 The conditions set out in paragraph 1, 4, 5, 7 and 8 of Schedule 2 shall not be capable of waiver by any party.

4.8 The conditions set out in paragraph 6 of Schedule 2 shall be capable of waiver in whole or in part by Sappi only.

5. TERMINATION RIGHTS

5.1 Sappi shall be entitled to terminate this Agreement by written notice to M-real if there shall have occurred or be reasonably likely to occur a “Significant Adverse Change” in the period between the date of this Agreement and Completion which is not capable of remedy pursuant to arrangements satisfactory to Sappi (acting reasonably) EXCLUDING in any such case any change, event or circumstance resulting from:

(i) changes in international or national financial, monetary, economic, political or financial markets conditions (including without limitation interest rates, exchange rates or commodity prices) however arising;

(ii) any national emergency, act of terrorism, war, conflict, outbreak of hostilities or riot or other civil disturbance;

(iii) changes in conditions affecting the paper industry generally;

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(iv) changes in laws, regulations and accounting practices;

(v) matters fairly disclosed in the Disclosure Letter;

(vi) the negotiation, execution, announcement or performance of this Agreement or any other Transaction Document, or any arrangements contemplated by those agreements (including, without limitation, any prospective or actual change of control arising from the transaction documents); or

(vii) actions contemplated or required to be taken or omitted to be taken pursuant to this Agreement or any other Transaction Document or with Sappi’s consent.

5.2 If the conditions set out in paragraph 2 of Schedule 2 are not fulfilled or waived on or before 11 January, 2009, M-real and Sappi will enter into a good faith negotiation for a period ending on 31 January, 2009 regarding the fulfilment of the conditions in paragraph 2 of Schedule 2. If, by the end of the above mentioned negotiation period, M-real and Sappi do not reach a mutually acceptable agreement, either party shall be entitled, at its sole and absolute discretion, to terminate this Agreement forthwith, at any time, by written notice to the other parties. Any such termination shall not affect M-real’s rights under clause 40.

5.3 If any fact which will prevent the conditions set out in paragraphs 2, and 3 of Schedule 2 from being satisfied on or before the Termination Date comes to the knowledge of a party, then the relevant party shall inform the other parties and thereafter each party shall be entitled to terminate this Agreement by written notice to the other parties.

5.4 Without prejudice to clause 5.2, if the conditions set out in Schedule 2 are not fulfilled or waived on or before the Termination Date, this Agreement shall automatically terminate.

5.5 If the Agreement is terminated or terminates in accordance with this clause 5 the obligations of each party under this Agreement shall automatically terminate PROVIDED THAT the rights and liabilities of the parties which have accrued prior to termination shall subsist.

6. CONDUCT OF BUSINESS BEFORE COMPLETION

6.1 Subject to clause 6.2, the Relevant Sellers shall procure that the Graphic Paper Business will be carried on in the ordinary and usual course and that no member of the Sellers’ Group shall, between the date of this Agreement and Completion, undertake any act or course of conduct which is outside the ordinary course of the Graphic Paper Business. The Relevant Sellers shall procure that no member of the Sellers’ Group shall undertake any of the acts or matters specified in clause 6.3 without the prior written consent of the Relevant Purchasers, (such consent not to be unreasonably withheld or delayed).

6.2 Clause 6.1 shall not operate so as to restrict or prevent, in each case in relation to the Graphic Paper Business:

(i) the disposal of all or of any part of the Xxxxxx PM2;

(ii) the undertaking in good faith of any matter reasonably necessary in an emergency or disaster situation with the intention of minimising any adverse effect on the Graphic Paper Business thereof (and of which the Relevant Purchasers will be promptly notified);

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(iii) the completion or performance of any obligations undertaken pursuant to any contract or arrangement entered into by any member of the Sellers’ Group prior to the date of this Agreement or after the date of this Agreement but in accordance with the provisions of clause 6.1;

(iv) any matter undertaken at the written request of the Relevant Purchasers, provided that the Relevant Purchasers shall only be entitled to give instructions where following such instructions would be lawful (in particular under competition law aspects);

(v) any matter reasonably required to be undertaken in connection with the completion of the Pre-sale Reorganisation;

(vi) any Sellers’ Group cash pooling arrangements or hedging (in relation to energy agreements);

(vii) any matter contemplated by this Agreement or any action taken by the Relevant Sellers or any member of the Sellers’ Group pursuant to this Agreement;

(viii) any action or omission which the Relevant Sellers or any member of the Sellers’ Group is required to take or omit to take by any applicable law or regulation, Tax Authority or other authority;

(ix) the management of the working capital of the Graphic Paper Business with a view to achieving the Target Net Working Capital amount and then maintaining it at or around that amount;

(x) any disposal of stocks, obsolete assets or redundant assets, or any payment of cash in each case consistent with ordinary course business practice in the running of the Graphic Paper Business;

(xi) the release or discharge of any charge or Encumbrance over any of the Business Properties; and

(xii) entering into arrangements for the purposes of settling or agreeing merchant rebates providing that the Relevant Sellers shall consult with the Relevant Purchasers in settling or agreeing the same if they may lawfully do so.

6.3 The acts and matters referred to in clause 6.1 as outside the ordinary course are the following and in each case in relation to the Graphic Paper Business:

(i) any disposal (not being a disposal in the ordinary course of business) of any interest in any part of the Graphic Paper Business;

(ii) the acquisition or disposal of any interest in Immovable Property;

(iii) any offer by a member of the Sellers’ Group to engage any new Senior Employee at any annual salary or fee per employee (on the basis of full time employment) in excess of €150,000 per annum, provided such a total shall not exceed €600,000 in aggregate, in each case exclusive of any amount in respect of VAT;

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(iv) save than in emergency, enter into any agreement or incur any commitment involving any capital expenditure in excess of €1,000,000 per item and €10,000,000 in aggregate, in each case exclusive of any amount in respect of VAT;

(v) any dismissal of any Senior Employee, other than for cause or unless not to do so would, in the reasonable opinion of M-real, materially damage the Graphic Paper Business;

(vi) acquire or agree to acquire any material share, shares or other interest in any company, partnership or other venture;

(vii) incur any additional external borrowings or incur any other external indebtedness;

(viii) any material amendment to the terms and conditions of employment (including, without limitation, remuneration, pension entitlements and other benefits) of any Senior Employee;

(ix) other than the payment of any bonuses in connection with the transaction contemplated by this Agreement, provide or agree to provide any gratuitous payment or benefit to any Employee or any of his dependants;

(x) discontinue or amend any employee benefit scheme or arrangement to any material extent or commence to wind them up or terminate them or cause them to cease to admit new members;

(xi) communicate to any Employee any material plan, proposal or intention to discontinue, amend, wind up, terminate or exercise any discretion in relation to any employee benefit scheme or arrangement;

(xii) pay any benefits under any employee benefit scheme or arrangements otherwise than in accordance with the terms of the documents governing such scheme or arrangements (and not under any discretionary power otherwise than in the ordinary course);

(xiii) save than in the ordinary course and in respect of the transactions contemplated by this Agreement (including in respect of agreements or commitments in respect of the Coaters), the entry into any agreement or commitment (whether formal or informal) with any employee representative body (howsoever described, and whether legally binding or otherwise);

(xiv) save for the Mill Business Efficiency Programme, any increase or decrease (other than as a result of natural attrition or pursuant to a programme disclosed to Sappi) in the total number of Employees at each location of the Graphic Paper Business outside a margin of +/-2% of the total number of Employees at each such location;

(xv) any material changes to pension arrangements for which the Graphic Paper Business is liable or termination of funds or announcements to staff of the same;

(xvi) any amendment, including any increase in emoluments (including, without limitation, pension contributions, bonuses, commissions, holiday pay and benefits in kind), to the terms of employment of any category of Employees which would result in an increase in cost after the date of this Agreement of the Graphic Paper Business in excess of

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€500,000 (exclusive of any amount in respect of VAT) save for increases in emoluments made in accordance with the normal practice of the Sellers’ Group or in accordance with standard industry increases or collective bargaining agreements;

(xvii) any grant of any guarantee or indemnity for the obligations of any person in relation to the Graphic Paper Business;

(xviii) any creation, allotment or issue or any grant of any option over or other right to subscribe or purchase, or any redemption or purchase of, any share or loan capital or securities of any member of the Group or securities convertible into any of the foregoing and any debt for equity swaps in relation to the Graphic Paper Business to ensure no negative consideration is paid under this Agreement;

(xix) the entering into of any transaction by any member of the Group with any member of the Sellers’ Group other than on terms that are currently in force or on arm’s length terms and in the ordinary course of business;

(xx) the creation or grant of any option, right to acquire, mortgage, charge, pledge, lien (other than a lien arising by operation of law or in the ordinary course of business), guarantee, indemnity or other form of security or Encumbrance or equity on, over or affecting any of the Business Assets or the whole or any part of the undertaking or assets of any member of the Group other than rights arising under retention of title clauses (or equivalent provisions the effect of which is that property does not pass until payment is made);

(xxi) the making of any loan or lease to any person (other than to any other member of the Group or to any member of the Sellers’ Group, including the participation or contribution to any cash-pooling arrangements of the Sellers’ Group);

(xxii) the repaying, redemption or repurchasing of any of the share capital of any Group Company;

(xxiii) the entering into, or exercising of an option in relation to, or amendment of any agreement or incurring any commitment which is not capable of being terminated without compensation at any time within twelve months’ notice or less or which is not in the ordinary and usual course of business or which involved or may involve total annual expenditure in excess of €500,000, exclusive of any amount in respect of VAT;

(xxiv) save for any payments or distributions due pursuant to the Profit and Loss Pooling Agreement between Deutsche Holding and Stockstadt GmbH and, if the applicable withholding tax exemption has been obtained, the distribution of retained earnings by Biberist, the declaration, or payment of any dividend or other distribution to shareholders;

(xxv) the amendment of, to any material extent, any of the terms on which goods, facilities or services are supplied, such supplies being material in the context of the Graphic Paper Business;

(xxvi) in respect of an event arising after the date of this Agreement, the settlement of any insurance claim by the Relevant Seller or any member of the Relevant Seller’s Group in excess of €2,000,000 materially below the amount claimed;

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(xxvii) the making of any change to its accounting practices or policies or amending its constitutional documents;

(xxviii) in relation to any Properties:

(a) the carrying out of any material structural alteration or addition to, or materially effecting any change of use of, such Properties;

(b) the termination or service of any notice to terminate, surrender or accept any surrender of or waive the terms of any lease, tenancy or licence which is material in the context of the Graphic Paper Business taken as a whole;

(c) the agreement of any new rent or fee payable under any lease, tenancy or licence which is material in the context of the Graphic Paper Business taken as a whole;

(d) the entering into or variation of any agreement, lease, tenancy, licence or other commitment which is material in the context of the Graphic Paper Business taken as a whole;

(e) the selling, conveyance, transfer, assignment or charging of any of the Properties or granting of any rights or easements over any of the Properties or the entering into of any covenants or other Encumbrances affecting any of the Properties or agreement to do any of the foregoing; and

(xxix) the entering into of any agreement (conditional or otherwise) to do any of the foregoing.

6.4 If the Completion Date is likely to fall after 31 December, 2008, M-real and Sappi agree that they shall enter into a good faith negotiation from 15 December, 2008 to agree any amendments to this clause 6 to reflect likely changes to the Graphic Paper Business from 1 January, 2009.

7. CONSIDERATION

7.1 The Initial Consideration for the sale of the Business Assets and the Shares is based on the Enterprise Value less the Estimated Net Debt and shall be paid by the Relevant Purchasers to the Relevant Sellers at Completion.

7.2 The Initial Consideration shall be made up of the Consideration Shares which shall (for the purpose of this clause 7 and the preparation of the Completion Statements and the adjustments in clause 8) have a value of €50,000,000, the Proceeds of the Rights Issue and the balance by the M-Real Vendor Loan Note.

7.3 The Consideration Shares shall be listed on the JSE and endorsed “non-resident” or the equivalent in respect of dematerialised shares.

7.4 No later than two Business Days prior to the Completion Date, M-real shall notify the Purchaser in writing to whom the Consideration Shares (and in which proportion) should be issued. The Consideration Shares shall be allotted, issued and delivered to M-real (or its nominee(s)) and the M-real Vendor Loan Note shall be issued and delivered to M-real on the Completion Date as provided in paragraphs 1(B) (iv) and (vi) of Schedule 3.

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7.5 On the Completion Date, the Relevant Purchasers shall issue to M-real the Vendor Loans which M-real agrees to immediately transfer and assign to Sappi on Completion.

7.6 In addition to the Initial Consideration, the Relevant Purchasers shall in consideration for the transfer of the receivables comprising the Inter-Group Debt (as set out clause 3.5), pay to the Sellers’ Group at Completion an amount equal to the Estimated Inter-Group Debt.

7.7 The Initial Consideration and the Estimated Inter-Group Debt shall be paid to the Relevant Sellers in accordance with paragraph 1(B)(ii) of Schedule 3.

7.8 The Consideration shall be allocated in accordance with Schedule 6.

7.9 Reduction of Consideration:

(i) If any payment is made by any Relevant Seller to any Relevant Purchaser in respect of any claim for any breach of this Agreement or pursuant to an indemnity under this Agreement, the payment shall be made by way of adjustment of the Consideration paid by the Relevant Purchaser for the particular category of Business Asset, Shares or receivables (if any) to which the payment and/or claim relates under this Agreement and the Consideration shall be (and shall be treated as having been) reduced by the amount of such payment;

(ii) If:

(a) the payment and/or claim relates to more than one category of Business Asset, Shares or receivables, it shall be allocated in a manner which reflects the impact of the matter to which the payment and/or claim relates, failing which it shall be allocated rateably to the relevant Business Assets, Shares or receivables by reference to the proportions in which the Consideration is allocated in accordance with Schedule 6; or

(b) the payment and/or claim relates to no particular category of Business Asset,  Shares or receivables, it shall be allocated rateably to all Business Assets, Shares and receivables by reference to the proportions in which the Consideration is allocated in accordance with Schedule 6,

and in each case the Consideration shall be (and shall be treated as having been) reduced by the amount of such payment.

7.10 The Relevant Sellers acknowledge and agree that the Consideration Shares have not been and will not be registered under the Securities Act and the Consideration Shares issued pursuant to this Agreement are “restricted securities” within the meaning of Rule 144 under the Securities Act.  The Consideration Shares purchased by M-real pursuant to this Agreement are being acquired for investment only and not with a view to any public distribution thereof.  M-real shall not offer to sell or otherwise dispose of the Consideration so acquired by it in violation of any of the registration requirements of the Securities Act.

7.11 The Relevant Purchasers acknowledge that the M-real Vendor Loan Note is freely transferable and may be sold, encumbered or otherwise disposed of by M-real on and subject to the terms and conditions set out in the M-real Vendor Loan Note.

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8. COMPLETION STATEMENTS AND ADJUSTMENTS

8.1 Each of the Relevant Sellers and the Relevant Purchasers shall comply with their respective obligations in Schedule 6 in relation to the Completion Statements.

8.2 If the value of the Adjustment Payment is a negative amount, the absolute value of the Adjustment Payment together with an amount equivalent to interest thereon at the Agreed Rate (accrued daily) for the period from the Completion Date to the date of payment, shall be paid in total in cash to the Relevant Purchasers by the Relevant Sellers within seven Business Days of agreement or determination of the value of the Adjustment Payment; or

8.3 If the value of the Adjustment Payment is a positive amount, the value of the Adjustment Payment together with an amount equivalent to interest thereon at the Agreed Rate (accrued daily) for the period from the Completion Date to the date of payment, shall be paid in total to the Relevant Sellers by the Relevant Purchasers within seven Business Days of agreement or determination of the value of Adjustment Payment.

8.4 Any Adjustment Payment pursuant to clause 8.3 shall not take into account any Net Working Capital Adjustment if such adjustment is in excess of €50,000,000. The first €30,000,000 of any Net Working Capital Adjustment due from the Relevant Purchasers shall be paid by the Relevant Purchasers in cash to the Relevant Sellers. If the Net Working Capital Adjustment is greater than €30,000,000, the Relevant Purchasers shall, subject to clause 8.5 below and up to a face value limit of €20,000,000 (the “Kirkniemi Trade Receivables Cap”), be entitled to make up the balance by the transfer to the Relevant Sellers of Kirkniemi Trade Receivables with a total face value equal to the balancing amount but may elect to pay all or any of such (or where there are insufficient Kirkniemi Trade Receivables shall pay) additional €20,000,000 or lesser amount (as applicable) in cash. Subject to the Completion Statements being in agreed form and to clauses 8.2 and 8.3, the Relevant Purchasers agree that any required transfer of Kirkniemi Trade Receivables will begin on the fifth Business Day following Completion.

8.5 If the Completion Date falls after 31 December, 2008 the Kirkniemi Trade Receivables Cap shall be adjusted by the percentage amount relative to the percentage increase or decrease of the price of finished goods in respect of the Graphic Paper Business at the date of this Agreement when compared with the price of such goods on the Completion Date. Any dispute as to the amount of this percentage shall be determined in accordance with the provisions of Part 3 of Schedule 6.

8.6 If the value of the Inter-Group Debt Adjustment Payment is a negative amount, the absolute value of the Inter-Group Debt Adjustment Payment together with an amount equivalent to interest thereon at the Agreed Rate (accrued daily) for the period from the Completion Date to the date of payment, shall be paid to the respective Relevant Purchaser by the respective Relevant Seller, and by M-real on behalf of the relevant member of the Sellers’ Group who is not a Relevant Seller, within seven Business Days of agreement or determination of the value of the Inter-Group Debt Adjustment Payment.

8.7 If the value of the Inter-Group Debt Adjustment Payment is a positive amount, the value of the Inter-Group Debt Adjustment Payment together with an amount equivalent to interest thereon at the Agreed Rate (accrued daily) for the period from the Completion Date to the date of payment, shall be paid to the respective Relevant Seller, and to M-real on behalf of the relevant member of the Sellers’ Group who is not a Relevant Seller, by respective Relevant Purchaser within seven

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Business Days of agreement or determination of the value of the Inter-Group Debt Adjustment Payment, in each case against the assignment of the respective receivable of the amount corresponding to the Inter-Group Debt Adjustment Payment.

8.8 If the value of Inter-Group Receivables Adjustment Payment is a negative amount, the value of Inter-Group Receivables Adjustment Payment together with an amount equivalent to interest thereon at the Agreed Rate (accrued daily) for the period from the Completion Date to the date of payment, shall be paid to the respective Relevant Seller, or to M-real on behalf of the relevant member of the Sellers’ Group who is not a Relevant Seller, by the respective Group Company within seven Business Days of agreement or determination of the value of the Inter-Group Receivables Adjustment Payment.

8.9 If the value of Inter-Group Receivables Adjustment Payment is a positive amount, the value of Inter-Group Receivables Adjustment Payment together with an amount equivalent to interest thereon at the Agreed Rate (accrued daily) for the period from the Completion Date to the date of payment, shall be paid to the relevant Group Company by the Relevant Seller or by M-real, on behalf of the relevant member of the Sellers’ Group who is not a Relevant Seller, within seven Business Days of agreement or determination of the value of the Inter-Group Receivables Adjustment Payment.

8.10 The Relevant Sellers and the Relevant Purchasers agree that, upon all payments pursuant to clauses 8.6, 8.7, 8.8 and 8.9 having been made, all liabilities relating to payment of Inter-Group Debt shall be finally and conclusively settled as between the relevant member of Sellers’ Group and the respective Relevant Purchaser and that all Inter-Group Receivables shall be finally and conclusively settled. Subject to such payments, M-real shall procure that no member of Sellers’ Group will raise any claims relating to Inter-Group Debt against any Group Company, and the Relevant Purchasers shall procure that no Group Company and no member of the Purchaser’s Group will raise any claims relating to Inter-Group Receivables against any member of the Sellers’ Group.

8.11 The Relevant Purchasers agree that they will pay to the Relevant Sellers the Merchant Rebate Adjustment where such amount is a positive value, and the Relevant Sellers agree they will pay to the Relevant Purchasers the Merchant Rebate Adjustment where such amount is a negative value (in which event the payment will be the absolute amount of such negative value), within seven Business Days of agreement or determination of the same. The Merchant Rebate Adjustment is the difference between the value of the Merchant Rebates at 30 June, 2008 as determined for the purpose of calculating the Completion Statements and the actual value of those Merchant Rebates at the Completion Time (which shall be determined by calculating a pro rata adjustment of the value of the Merchant Rebates to the Completion Time). Any dispute as to the basis on which the Merchant Rebate Adjustment has been calculated shall be determined in accordance with Part 3 of Schedule 6 and references in that Schedule to “Completion Statements” shall be to the “Merchant Rebate Adjustment” and to “Completion” to the date on which the final actual payment of Merchant Rebates is made (which shall be within a reasonable period following the Completion Date).

8.12 For the avoidance of doubt:

(i) without prejudice to the Relevant Sellers’ obligations, if any, in clause 8.11, the Relevant Purchasers shall be responsible for the payment of the Merchant Rebates as from the

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Completion Time and shall indemnify the Relevant Sellers for any failure to make such payments; and

(ii) subject to Relevant Sellers indemnifying the Relevant Purchasers for any reasonable amount and to the extent agreed by the Relevant Purchasers in advance of any such merchant rebate payment in respect of period up to the Completion Date, the Relevant Purchasers shall be responsible for the payment of all merchant rebates in respect of the Coaters and the Know-How Business.

8.13 The Relevant Sellers shall be entitled to the Supplier Rebates and the Relevant Purchasers undertake that they will immediately transfer any such rebates received by a member of the Purchaser’s Group to the Relevant Sellers.

8.14 All payments referred to in this clause 8 shall constitute an adjustment to the Initial Consideration or the Estimated Inter-Group Debt and (save as permitted by clause 8.4) shall be made in immediately available funds in Euros in each case without any set-off, restriction or condition and without any deduction or withholding (save only as required by law) by telegraphic transfer to the account or accounts of the Relevant Purchasers or (as the case may be) the Relevant Sellers.

9. TRANSFER OF RISK

            The Relevant Sellers and Relevant Purchasers agree that risk in respect of the Business Assets and the Group shall pass to the Relevant Purchasers on Completion.

10. COMPLETION

10.1 Subject to clause 10.2 below, or as otherwise stated in this Agreement, Completion of the sale and purchase of the Business Assets shall take place at 10.00 a.m. on the Completion Date at the offices of the Sellers’ Solicitors at Xxx Xxxxxxx Xxx, Xxxxxx XX0X 0XX (or on such other date or at such other time or place as M-real and Sappi may agree).

10.2 Completion of the sale and purchase of the Business Properties will occur at the offices of Roschier, at Xxxxxxxxxx 0X, XX-00000 Xxxxxxxx, Xxxxxxx.

10.3 In case the Completion Date does not fall on a Business Day, Completion shall take place on the last Business Day before the Completion Date provided that in such case effectiveness of Completion shall, unless agreed otherwise by the Relevant Sellers and Relevant Purchasers, occur on the Completion Date.

10.4 Completion of the sale and purchase of the German Shares shall take place on the Completion Date at the offices of the relevant notary public in Germany in accordance with paragraph 4(A) of Schedule 3.

10.5 Completion of the sale and purchase of the Biberist Shares shall take place on the Completion Date at the offices of Xxxx & Xxxxxx XX at Xxxxxxxxxxxxxxxxxxx 00, XX-0000 Xxxxxx, Xxxxxxxxxxx in accordance with paragraph 4(B) of Schedule 3.

10.6 At Completion, each of the Sellers and the Relevant Purchasers shall do or procure the doing of those things respectively listed in respect of them in Schedule 3.

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10.7 The Sellers and the Purchasers shall not be obliged to complete the sale and purchase of any of the Shares or the Business Assets unless the sale and purchase of all of them shall have been completed in accordance with Schedule 3.

10.8 The cash element of the Initial Consideration and the Estimated Inter-Group Debt shall be payable by or on behalf of the Relevant Purchasers in immediately available funds in Euros at Completion as referred to in paragraph 1(B)(ii) of Schedule 3.

10.9 The Consideration Shares shall be issued to M-real (or its nominee(s)) at Completion as referred to in paragraph 1(B) (iv) of Schedule 3.

10.10 The M-real Vendor Loan Note shall be issued to M-real at Completion as referred to in paragraph 1(B)(vi) of Schedule 3.

10.11 Receipt of funds, Consideration Shares and the M-real Vendor Loan Note in accordance with clauses 10.8, 10.9 and 10.10 shall constitute a good discharge of the Relevant Purchasers in respect of the payment of the Initial Consideration and Estimated Inter-Group Debt but not, for the avoidance of doubt, in respect of the Relevant Purchasers’ other obligations under clause 8.

11. VAT

11.1 All sums payable for the sale of the Business Assets shall be deemed to be exclusive of any VAT which may be chargeable on the supply or supplies for which such sums (or any part thereof) are the whole or part of the consideration for VAT purposes; and accordingly if any VAT is chargeable in respect of the sale of the Business Assets, the Relevant Purchasers shall pay to the Relevant Sellers (in addition to and at the same time as paying the Initial Consideration) an amount equal to such VAT, against delivery of an appropriate VAT invoice.

11.2 Without prejudice to the generality of clause 11.1 above:

(i) M-real and the Relevant Purchaser acknowledge that the sale of the Business Assets which constitute the Mill Business (the “Mill Business Assets”) is intended to be treated as a transfer of a business for the purpose of Article 19(a) of the Finnish Act on Value Added Tax (30 December 1993/1501, as amended) (the “Finnish VAT Act”) and the Relevant Purchaser hereby confirms that it will, following Completion, use the Mill Business Assets for VAT deductible purposes. Both M-real and the Relevant Purchaser agree that this statement is considered to be the Relevant Purchaser’s statement as referred to in Section 209(f) of the Finnish VAT Act;

(ii) M-real and the Relevant Purchaser acknowledge that no VAT will be chargeable in respect of the sale and purchase of the Business Properties listed in Part A of Schedule 9;

(iii) the right and obligation to carry out VAT adjustments based on the investments in the Business Properties, subject to Article 120 of the Finnish VAT Act, shall transfer to the Relevant Purchaser at Completion in accordance with subsection 4 of Article 19(a) of the Finnish VAT Act. M-real undertakes to provide the Relevant Purchaser, on Completion, with the account (the “Account”) as referred to in Section 1 of Article 209(g) and a copy referred to in Section 3 of Article 209(g) of the Finnish VAT Act, to the extent M-real has received such accounts from previous holders of the Business Properties. M-real

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represents and warrants that no other accounts have been given by any previous holder of the Business Properties as referred to in Section 3 of Article 209(g) of the Finnish VAT Act.  M-real represents and warrants that the Account includes all matters provided in Article 209(h) of the Finnish VAT Act and is also in all respects free from defects;

(iv) M-real shall indemnify the Relevant Purchaser against all liabilities, damages and costs that the Relevant Purchaser suffers as a result of any defect or inadequacy in the Account, including any such defect or inadequacy arising after the date of the establishment of the Account  in respect of which M-real would be required, in accordance with Section 2 of Article 209(g) of the Finnish VAT Act, to render a supplementary account, regardless of whether M-real has in fact rendered such a supplementary account. M-real shall not be required to indemnify the Relevant Purchaser in respect of any liabilities, damages or costs arising (directly or indirectly) as a result of any matter taking place after Completion, or as a result of any failure of the Relevant Purchaser to use the Business Properties for VAT deductible purposes. The Relevant Purchaser shall compensate M-real for any benefit the Relevant Purchaser obtains (in the form of additional deductions or refund of VAT) as a result of any defect or inadequacy in the Account, provided that a supplementary account is rendered by M-real in accordance with section 2 of Article 209(g) of the VAT Act;

(v) the Relevant Purchaser hereby confirms in accordance with Section 209(i) of the Finnish VAT Act that it shall use the Business Properties for business activities following Completion and that it shall, by Completion, be entered in the Finnish VAT register; and

(vi) if, notwithstanding the provisions of this clause 11.2, the relevant Tax Authority shall determine that VAT is chargeable in respect of the supply of all or any part of the Mill Business Assets under this Agreement, the Relevant Seller shall notify the Relevant Purchaser of that determination within 7 days of its being so advised that Tax Authority and the Relevant Purchaser shall pay to the Relevant Seller by way of additional consideration in accordance with clause 11.1, a sum equal to the amount of VAT determined by the Tax Authority to be so chargeable, together with any related interest or penalties imposed by the Tax Authority (if any), within 30 days of the Relevant Seller notifying the Relevant Purchaser of that determination (against delivery by the Relevant Seller of an appropriate VAT invoice).

12. ACTION AFTER COMPLETION

12.1 If so requested by the Relevant Purchasers, the Relevant Sellers shall, for a period of three months or for so long thereafter as the Relevant Purchasers may reasonably request following Completion, join with the Relevant Purchasers in sending out notices (such notices to be agreed between the Relevant Sellers and the Relevant Purchasers prior to being sent out) to all third party suppliers and third party customers in relation to the Business and other business contacts relating to the Business informing them of the transfer of the Business.

12.2 The Relevant Sellers shall procure that originals of all notices, correspondence, information, orders or enquiries relating solely to the Business and copies of the relevant parts of all notices, correspondence, information, orders or enquiries relating partly to the Business and partly to one or more of the remaining businesses of the Sellers’ Group which are received by any member of the Sellers’ Group on or after Completion shall be passed as soon as practicable to the Relevant Purchaser.

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12.3 The Relevant Purchaser shall procure that originals of all notices, correspondence, information, orders or enquiries relating solely to one or more of the remaining businesses of the Sellers’ Group and copies of the relevant parts of all notices, correspondence, information, orders or enquiries relating partly to one or more of the remaining businesses of the Sellers’ Group and partly to the Business which are received by the Purchaser’s Group on or after Completion shall be passed as soon as practicable to the relevant member of the Sellers’ Group.

12.4 Without limiting clause 14.4(i), all moneys or other items belonging to the Relevant Purchaser or to any other member of the Purchaser’s Group which are received by the Relevant Sellers or any other member of the Sellers’ Group on or after Completion and were comprised within or were represented by the Business or any of the Business Assets sold at Completion pursuant to this Agreement shall be promptly paid over or delivered to the Relevant Purchasers or the relevant member of the Purchaser’s Group and, pending such payment, shall be held on trust (or procured to be held in trust) by the Relevant Sellers or such other member of the Sellers’ Group for the Relevant Purchasers or the relevant member of the Purchaser’s Group.

12.5 All moneys or other items belonging to the Relevant Sellers or to any other member of the Sellers’ Group which are received by the Relevant Purchasers or any other member of the Purchaser’s Group on or after Completion and were excluded from the Business or any of the Business Assets sold at Completion pursuant to this Agreement shall be promptly paid over or delivered to the Relevant Sellers or the relevant member of the Sellers’ Group and, pending such payment, shall be held on trust (or procured to be held in trust) by the Relevant Purchasers for the Relevant Sellers (or such other relevant member of the Sellers’ Group, as the case may be).

13. THIRD PARTY CONSENTS FOR THE SALE OF BUSINESS ASSETS

13.1 Where any consent or agreement of any third party (other than a relevant regulatory or anti-trust authority) is required for the transfer of any of the Business Assets (other than in relation to the transfer of any Business Contract or the performance of any Business Contract by the Relevant Purchasers) and such consent or agreement has not been obtained at or before Completion, (subject to any transfer by operation of law) the sale of the relevant Business Asset shall not take effect, notwithstanding Completion, until that consent or agreement has been obtained and each of the Relevant Sellers (or the relevant member of the Sellers’ Group) and the Relevant Purchasers shall (at the expense of the Relevant Purchasers) use their respective reasonable endeavours after Completion to obtain it as soon as possible.

13.2 After Completion, and until such time as any consent or agreement referred to in clause 13.1 is obtained the Relevant Seller (or the relevant member of the Sellers’ Group) shall be deemed to hold the benefit of the relevant Business Asset referred to in clause 13.1 on trust for the Relevant Purchasers, or where holding on trust is not possible under local law the Relevant Sellers and the Relevant Purchasers shall make such other arrangements between themselves to provide to the Relevant Purchasers the benefits of the relevant Business Assets.

14. TRANSFER OF BUSINESS CONTRACTS AND LICENCES

14.1 Subject to clause 14.2, the Relevant Purchasers shall become entitled to the benefits (subject to the burden) of the Business Contracts and this Agreement shall constitute an assignment of the benefit of the Business Contracts to the Relevant Purchasers with effect from Completion.

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14.2 This Agreement shall not constitute an assignment or attempted assignment of any Business Contract if the assignment or attempted assignment is not possible or would constitute a breach of the relevant Business Contract.

14.3 Where a Third Party Consent is required to the assignment of the benefit of, or novation of, a Business Contract or to some other arrangement required to be put in place in respect of those Business Contracts which relate in part only to the Business whereby the relevant part is severed and transferred, the Relevant Sellers shall use all reasonable endeavours (without incurring any costs or expenses) with the co-operation of the Relevant Purchasers (such co-operation to include, without limitation, the provision by the Relevant Purchasers of a guarantor or guarantors of the obligations under the relevant Business Contract, if required) to obtain any Third Party Consent to assignment or novation or to such severance arrangement of all relevant Business Contracts both before and after Completion.

14.4 After Completion, and until any necessary Third Party Consent is obtained, the following provisions shall apply:

(i) the Relevant Sellers shall be deemed to hold the benefit of that Business Contract (to the extent permitted under the relevant Business Contract) on trust for the Relevant Purchasers (if to do so would not constitute a breach of such Business Contract), or where holding on trust is not possible under local law the Relevant Sellers and the Relevant Purchasers shall make such other arrangements between themselves to provide to the Relevant Purchasers the benefits of the relevant Business Contract (including wherever possible licences of Intellectual Property), including the enforcement of all rights of the Relevant Sellers against any other party thereto;

(ii) if it is permissible under the relevant Business Contract, the Relevant Purchasers shall perform for or on behalf of the Relevant Sellers (but at the Relevant Purchasers’ expense) the obligations of the Relevant Sellers under that Business Contract failing to be performed on or after Completion; and

(iii) to the extent that the Relevant Purchasers are lawfully able to do so, and subject to the Relevant Purchasers receiving the benefits of the Business Contract, the Relevant Purchasers hereby undertake to pay the Relevant Sellers such amount as is required to indemnify each member of the Sellers’ Group against any act or omission of the Relevant Purchasers to perform or comply with any obligation of M-real which falls to be performed or complied with after Completion, as referred to in paragraph (ii) of this clause 14.4,

provided that this clause 14.4 will not apply to the Energy Plant Contracts.

14.5 Where the performance and discharge by the Relevant Purchasers of the obligations and liabilities arising under a Business Contract would constitute a breach by the Relevant Sellers of the terms of such Business Contract, the Relevant Sellers shall, until the Third Party Consent is obtained, continue so far as reasonably practicable to perform and discharge the relevant Business Contract to the extent necessary to avoid any such breach PROVIDED THAT:

(i) the Relevant Sellers shall exercise their rights in respect of such Business Contract as the Relevant Purchasers may direct or approve (acting reasonably) and not otherwise and shall account to the Relevant Purchasers for any sums arising thereunder;

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(ii) the Relevant Purchasers (at their own expense) shall provide the Relevant Sellers with such documents, facilities and assistance and/or enter into such other arrangements as the Relevant Sellers shall reasonably deem necessary or require for the purpose of performing and discharging the Business Contract, in each case in such manner that the Relevant Sellers are not in breach thereof;

(iii) the Relevant Sellers shall be deemed to hold the benefit of such Business Contract (to the extent permitted under the relevant Business Contract) on trust for the Relevant Purchasers (if to do so would not constitute a breach of such Business Contract) and such benefit will be promptly paid over to the Relevant Purchasers; and

(iv) the Relevant Purchasers shall reimburse the Relevant Sellers any costs and expenses reasonably incurred by the Relevant Sellers, and shall on behalf of the Relevant Sellers discharge any liabilities in each case arising as a result of such performance and discharge by the Relevant Sellers and shall provide all reasonable facilities and assistance to the Relevant Sellers free of charge for such purpose (including, without limitation, providing the services of the Business Employees, access to the Business Properties and the use of the Business Assets) and shall pay to the Relevant Seller such amount as is required to indemnify each member of the Sellers’ Group in respect of the same,

provided that this clause 14.5 shall not apply to the Energy Plant Contracts.

14.6 M-real shall, on behalf of itself and the Sellers Group’, within 5 Business Days of execution of this Agreement seek a Third Party Consent from Fortum in relation to the transfer, assignment or novation of the Energy Plant Contracts to the Relevant Purchasers.

14.7 If the Third Party Consent of Fortum in relation to all of the Energy Plant Contracts is granted then the Energy Plant Contracts shall be so transferred, assigned or novated to the Relevant Purchasers.

14.8 If the Third Party Consent of Fortum in relation to the Energy Plant Contracts is not able to be obtained by the Relevant Sellers or relevant members of the Sellers’ Group, then the Relevant Sellers or the relevant members of the Sellers’ Group shall enter into energy plant contracts on equivalent terms, mutatis mutandis, as those in place between Fortum and the Relevant Sellers or the relevant members of the Sellers’ Group in order to vest in the Relevant Purchasers all the benefits thereof as if it were a party to such agreements itself.

14.9 For the purposes of Schedule 6, M-real shall be deemed to have complied with its obligations under this clause 14.9 if the provisions of:

(i) clause 14.7 or 14.8 are complied with; and

(ii) the Energy Plant Contracts (including, for the avoidance of doubt, the CHP Lease) have been transferred to the Relevant Purchasers in accordance with the provisions of clauses 2, and/or 14.7 or 14.8.

14.10 Without prejudice to the provisions of Schedule 6, if M-real has not complied with its obligations under clause 14.9 at Completion, Sappi shall pay €20m to M-real within 7 Business Days of

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M-real complying with clause 14.9 providing M-real complies with clause 14.9 within 30 Business Days of Completion.

14.11 M-real and Sappi shall use their best efforts to have the Stockstadt Lease between Stockstadt GmbH and Molsindra Vermietungsgesellschaft mbH & Co. Objekt Stockstadt KG (the “Lessor”)  amended to the effect that any links to M-real shall cease and M-real shall be released of any obligations towards the Lessor or Stockstadt GmbH arising from the Stockstadt Lease. In particular, the termination right of the Lessor under section 11.3 of the Stockstadt Lease relating to M-real’s group credit facility and the right of Lessor to request M-real to assume the Stockstadt Lease under the lease assumption agreement shall be cancelled. In return for such changes Sappi is prepared to give the Lessor reasonable comfort with respect to the fulfilment of the Stockstadt Lease by Stockstadt GmbH on a level which is comparable to the comfort given by M-real so far. In the event the Lessor should be unwilling to renegotiate and amend the Stockstadt Lease but the Stockstadt Lease is not terminated by the Lessor, Sappi shall indemnify and hold harmless M-real from and against any losses and damages in connection with the Stockstadt Lease to the extent such losses and damages relate to the period after the Completion Date. Should M-real have to assume the Stockstadt Lease pursuant to the lease assumption agreement, M-real shall act at the instruction and for the account of the Relevant Purchaser as if the Relevant Purchaser was a party to the Stockstadt Lease and Sappi shall indemnify and hold harmless M-real from and against any losses and damages in connection with the Stockstadt Lease to the extent such losses and damages relate to the period after the Completion Date.

15. ASSUMED LIABILITIES AND ASSURANCES

15.1 The Relevant Purchasers hereby agree with the Relevant Sellers that they will duly and properly perform, assume and pay and discharge when due, and pay to the Relevant Sellers such amount as is required to indemnify the Relevant Sellers and each other relevant member of the Sellers’ Group against, all Assumed Liabilities save to the extent any such Assumed Liability is recoverable under Schedules 14 and 15.

15.2 In this Agreement “Assumed Liabilities” means:

(i) all outstanding or unperformed obligations of the Relevant Sellers and each other member of the Sellers’ Group under the Business Contracts (including, for the avoidance of doubt, all trade payables) whether falling due for observance or performance before, at or after Completion, excluding those obligations to the extent arising from events occurring on or prior to Completion except to the extent they are provided for in the Carve-Out Accounts or to the extent taken account in the Net Working Capital Adjustment or in an Adjustment Payment or otherwise in the Completion Statements;

(ii) without prejudice to clause 19.9 (ii), all obligations and liabilities (including all business rents, rates and other periodic outgoings) in respect of the Business Properties whether falling due for observance or performance before, at or after Completion, excluding those obligations and liabilities to the extent arising from events occurring on or prior to Completion except to the extent they are provided for in the Carve-Out Accounts or to the extent taken account in the Net Working Capital Adjustment or otherwise in an Adjustment Payment or otherwise in the Completion Statements; and

(iii) all liabilities arising in connection with the condition of, or any defect in, any Business Stocks, excluding those liabilities to the extent arising from events occurring on or prior to

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Completion except to the extent they are provided for in the Carve-Out Accounts or to the extent taken account in the Net Working Capital Adjustment or otherwise in an Adjustment Payment or otherwise in the Completion Statements.

15.3 The Relevant Purchasers covenant that, at any time and from time to time on or after Completion they will execute and deliver all such further instruments of assumption and acknowledgements as any member of the Sellers’ Group may reasonably request in order to effect the release and discharge in full of the relevant member of the Sellers’ Group in respect of any Assumed Liability and the Relevant Purchasers’ assumption of the Assumed Liabilities and the substitution of the Relevant Purchasers as the primary obligors in respect of the Assumed Liabilities in each case on a non-recourse basis to the Sellers’ Group.

15.4 The Relevant Purchasers covenant that, at any time and from time to time on or after Completion they will execute and deliver all such further instruments of assumption and acknowledgements as any member of the Sellers’ Group may reasonably request in order to effect the release and discharge in full of any Assurance howsoever structured given at any time by any member of the Sellers’ Group to any person in respect of any obligation or liability of any member of the Group and the Relevant Purchasers’ assumption of, and the substitution of the Relevant Purchasers as the primary obligors in respect of, each such Assurance, in each case on a non-recourse basis to members of the Sellers’ Group.

15.5 The Relevant Purchasers hereby agree with each of the Relevant Sellers (on behalf of themselves and each other member of the Sellers’ Group) that they will assume and pay and discharge when due, and pay to the Relevant Sellers such amount as is required to indemnify each member of the Sellers’ Group against the Assurances referred to in clause 15.4 (other than to the extent that they have been released and discharged in accordance with clause 15.4).

15.6 Each of the Relevant Sellers covenant that, at any time and from time to time on or after Completion, they will execute and deliver all such instruments of assumption and acknowledgements or take such other action as the Relevant Purchasers may reasonably request in order to effect the release and discharge in full of any Assurance howsoever structured given by any member of the Group or otherwise by the Business to any person in respect of any obligation or liability of any member of the Sellers’ Group and shall procure the assumption of, and the substitution of an appropriate member of the Sellers’ Group as the primary obligor in respect of, each such Assurance on a non-recourse basis to the Purchaser’s Group.  Pending such release and discharge, the Relevant Sellers hereby agree with the Relevant Purchasers (on behalf of themselves and each member of the Group) that they will assume and pay and discharge when due, and pay to the Relevant Purchasers such amount as is required to indemnify each member of the Group against, all such Assurances.

16. BUSINESS RECEIVABLES

16.1 As soon as practicable following Completion, the Relevant Sellers shall deliver to the Relevant Purchasers details of the Business Receivables.

16.2 Notwithstanding clause 16.1, as soon as practicable following the satisfaction of the conditions in paragraphs 2 and 3 of Schedule 2 the Relevant Sellers shall use reasonable endeavours to deliver details of the Business Receivables to the Relevant Purchasers.

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16.3 Subject to clause 8.4, the Relevant Sellers agree that the Relevant Purchasers alone shall be responsible for the collection of any of the Business Receivables and that:

(i) the Relevant Purchasers shall be entitled to take such steps as it may think fit to recover any outstanding Business Receivables;

(ii) the Relevant Sellers shall not take, and shall procure that no other member of the Sellers’ Group takes, any step to collect the Business Receivables, and shall not do anything to hinder their collection by the Relevant Purchasers; and

(iii) if the Relevant Sellers or any other member of the Sellers’ Group should receive any communication or payment in respect of any Business Receivable, the Relevant Sellers shall or shall procure that written details of any such communication or payment are given to the Relevant Purchasers as soon as reasonably practicable following receipt thereof.

16.4 Where anything (including any service or payment) is to be provided by a member of the Purchaser’s Group under any of the Business Contracts after Completion, but any payment (whether by way of deposit, prepayment, provision of a service or otherwise) in respect of the price or cost of it has been received by a member of the Sellers’ Group before Completion, the Relevant Sellers shall procure that the relevant member of the Sellers’ Group pays a sum equal to the amount of that payment to the relevant member of the Purchaser’s Group immediately following Completion, following receipt of which the member of the Purchaser’s Group shall provide such thing or service or payment and shall hold such sum on trust for that member of the Purchaser’s Group until it is paid over.

16.5 Where anything (including any service or payment) is to be provided by a member of the Purchaser’s Group under any of the Business Contracts after Completion, but any payment (whether by way of deposit, prepayment provision of a service or otherwise) has been made by a member of the Sellers’ Group in respect of the price or cost of it before Completion, the Relevant Purchasers shall procure that that relevant member of the Purchaser’s Group pays a sum equal to the amount of that payment to the relevant member of the Sellers’ Group as soon as reasonably practicable following the member of the Purchaser’s Group becoming aware of such thing or service and shall hold such sum on trust for that member of the Sellers’ Group until it is paid over.

16.6 Any sums received by the Relevant Purchasers or the Relevant Sellers (or any other member of the Sellers’ Group) from a third party from whom monies are due both to the Relevant Sellers (and/or another member of the Sellers’ Group) in respect of any other business and to the Relevant Purchasers in respect of the Business which monies were separately invoiced prior to Completion, where the monies are not clearly identifiable or apportionable as relating in whole or in part to a debt in respect of the Business or a debt of the Relevant Sellers (or another member of the Sellers’ Group) in respect of any other business, shall be deemed first to be in satisfaction of the liability which first arose.

16.7 Any sum received by the Relevant Purchasers from a third party from whom monies are due both to the Relevant Sellers (and/or another member of the Sellers’ Group) and to the Relevant Purchasers under a single invoice rendered to that third party which does not constitute a payment of the whole amount due under such invoice but only in part thereof shall be payable as follows:

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(i) if the payment is accompanied by a statement (express or implied) by the third party as to which goods it is made in respect of, then in accordance with such statement; and

(ii) if no such statement as to the aforesaid matters is made by the third party, then to each of the parties entitled under the relevant invoice, the pro rata proportion of the part payment made which corresponds to the proportion of the entire amount invoiced due to that party,

ALWAYS PROVIDED THAT if, in circumstances where a payment is apportioned in accordance with the provisions of sub-clause (ii) above, it is subsequently ascertained which goods the part payment was made in respect of, then the party or parties to whom such payment would have been made, had it been known at the time that such monies were received to whom such payment should have been made, shall be entitled to call for such amount to be paid over by the party or parties who received such payment in the first instance, who shall promptly pay over the same. The provisions of sub-clause (ii) above shall apply, mutatis mutandis, to any sum received by the Relevant Sellers (and/or any other member of the Sellers’ Group) in respect of any such invoice and the Relevant Sellers shall procure compliance with such provisions by any relevant member of the Sellers’ Group.

16.8 The Relevant Sellers (or any other member of Sellers’ Group) shall be under no liability to the Relevant Purchasers if any of the Business Receivables are not paid save where such non-payment was caused by the Relevant Sellers’ wilful default or negligence in the performance of its obligations under this clause 16.

17. SELLERS’ WARRANTIES AND PURCHASERS’ REMEDIES

17.1 Subject as provided in this Agreement, M-real, on behalf of itself and the Relevant Sellers, warrants to the Relevant Purchasers as at the date of this Agreement in the terms of the Warranties set out in Schedule 4.

17.2 The only Warranties given:

(i) in respect of the Properties are those contained in paragraph 16 of Schedule 4 and each of the other Warranties shall be deemed not to be given in relation to the Properties;

(ii) in respect of Environmental Matters are those contained in paragraph 17 of Schedule 4 and each of the other Warranties shall be deemed not to be given in relation to Environmental Matters;

(iii) in respect of Intellectual Property (including for the avoidance of doubt, any Intellectual Property subsisting in any IT Systems), know-how and contracts, arrangements and engagements relating thereto are those contained in paragraph 18 of Schedule 4 and each of the other Warranties shall be deemed not to be given in relation to Intellectual Property, know-how and contracts, arrangements and engagements relating thereto;

(iv) in respect of IT Systems (or agreements relating thereto) are those contained in paragraph 18 of Schedule 4 and each of the other Warranties shall be deemed not to be given in relation to IT Systems (or agreements relating thereto);

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(v) in respect of Tax are those contained in paragraph 22 of Schedule 4 and each of the other Warranties shall be deemed not to be given in relation to Tax;

(vi) in respect of all employment and pension matters are those contained in paragraphs 20 and 21 respectively of Schedule 4 and each of the other Warranties shall be deemed not to be given in relation to employment and pension matters; and

(vii) in respect of the Accounts and the Carve-Out Accounts are those contained in paragraph 9 of Schedule 4 and each of the other Warranties shall be deemed not to be given in relation to Accounts and Management Accounts.

17.3 The liability of the Relevant Sellers under or in relation to the Warranties shall be limited as set out in Schedule 5.

17.4 Any payment made by the Relevant Sellers in respect of any claim under the Warranties shall be made, to the extent possible, by way of an adjustment to the Consideration.

17.5 The Relevant Purchasers acknowledge and agree that the Relevant Sellers make no representation or warranty as to the accuracy of the forecasts, estimates, projections, statements of intent or statements of honestly expressed opinion provided to the Relevant Purchasers (howsoever provided) on or prior to the date of this Agreement, including without limitation, in the Disclosure Letter, the Data Room or in the documents provided to the Relevant Purchasers or their advisers in the course of the Relevant Purchasers due diligence exercise.

17.6 The Relevant Purchasers acknowledge that they do not rely and have not been induced to enter into this Agreement on the basis of any warranties, representations, covenants, undertakings, indemnities or other statements whatsoever other than the Warranties and acknowledge that neither the Relevant Sellers nor any member of the Sellers’ Group or any of their respective agents, officers or employees or any other person has given such warranties, representations, covenants, undertakings, indemnities or other statements.

17.7 The Relevant Purchasers acknowledge and agree that they are not aware of any matter on or before the date of this Agreement which would form the basis of a claim for breach of Warranty.

17.8 Notwithstanding that the Relevant Purchasers become aware at any time that there has been any breach of any of the Warranties or any other term of this Agreement, the Relevant Purchasers shall not be entitled to rescind this Agreement or treat it as terminated but shall be entitled to claim damages or exercise any other right, power or remedy under this Agreement or as otherwise provided by law. The Relevant Purchasers waive all and any rights of rescission in respect of this Agreement they may have (howsoever arising or deemed to arise) other than any such rights in respect of fraud.

17.9 Each of the Warranties shall be construed as a separate and independent warranty and, except where expressly provided to the contrary, shall not be limited or restricted by reference to or inference from the terms of any other Warranty or any other provision of this Agreement.

17.10 If after the signing of this Agreement and before Completion (as appropriate):

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(i) any Relevant Seller shall become aware that any of the Warranties set out in paragraphs 1, 2, 4 and 6(A) of Schedule 4 of this Agreement was untrue or inaccurate as of the signing of this Agreement; or

(ii) any event shall occur or matter shall arise of which any Relevant Seller becomes aware which would result in any of the Warranties set out in paragraphs 1, 2, 4 and 6(A) of Schedule 4 of this Agreement being untrue or inaccurate at Completion had the Warranties set out in paragraphs 1, 2, 4 and 6(A) of Schedule 4 of this Agreement been repeated on Completion,

the Relevant Sellers shall notify the Relevant Purchasers in writing as soon as practicable and in any event prior to Completion setting out full details of the matter and the Relevant Sellers shall make any investigation concerning the event or matter and take such action, at their own cost, as the Relevant Purchasers may reasonably require.

17.11 Any notification pursuant to clause 17.10 shall not operate as a disclosure pursuant to paragraph 10 of Schedule 5 and the Warranties set out in paragraphs 1, 2, 4 and 6(A) of Schedule 4 of this Agreement shall not be subject to such notification.

17.12 The Relevant Sellers further warrant to the Relevant Purchasers that the Warranties set out in paragraphs 1, 2, 4 and 6(A) of Schedule 4 of this Agreement will be true and accurate at Completion as if they had been repeated at Completion.

17.13 For the avoidance of doubt, clauses 17.10 to 17.12 shall only apply to the Warranties specifically set out in those clauses and not any other Warranty set out in Schedule 4 of this Agreement.

18. PURCHASERS’ WARRANTIES

18.1 The Purchaser, on behalf of itself and the Relevant Purchasers, warrants to the Relevant Sellers as at the date of this Agreement that:

(i) each of the Relevant Purchasers has the requisite power and authority to enter into and perform this Agreement and any other documents (including, without limitation, the M-real Vendor Loan Note and the Vendor Loans) which are to be entered into pursuant to this Agreement to which they are a party (the “Purchasers’ Completion Documents”).

(ii) this Agreement constitutes and the Purchasers’ Completion Documents will, when executed by the Relevant Purchasers, constitute binding obligations of the Relevant Purchasers in accordance with the respective terms of each such document.

(iii) the execution and delivery of, and the performance by each of the Relevant Purchasers of their respective obligations under this Agreement and the Purchasers’ Completion Documents to which each is respectively a party will not:

(a) result in a breach of any provision of the memorandum or articles of association or equivalent constitutional documents of the Relevant Purchasers;

(b) result in a breach of, or constitute a default under, any instrument to which the Relevant Purchasers are a party or by which the Relevant Purchasers are

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bound and which is material in the context of the transactions contemplated by this Agreement;

(c) so far as the Relevant Purchasers are aware, result in a breach of any existing order, judgment or decree of any court or governmental agency to which the Relevant Purchasers are a party or by which the Relevant Purchasers are bound and which is material in the context of the transactions contemplated by this Agreement; or

(d) save as contemplated by this Agreement, require the Relevant Purchasers to obtain any consent or approval of, or give any notice to or make any registration with, any governmental or other authority which has not been obtained or made at the date of this Agreement and is in full force and effect; and

(iv) save as disclosed in a letter to M-real of even date herewith, no member of the Purchaser’s Group is engaged in any legal or arbitration proceedings which may have or have had during the preceding 12 months a significant effect on the financial or trading position of the Purchaser’s Group and no such legal or arbitration proceedings are threatened or pending nor to the best of the knowledge, information and belief of the Purchaser (having made all reasonable enquires), are there any circumstances which may give rise to any such legal or arbitration proceedings.

18.2 If after the signing of this Agreement and before Completion (as appropriate):

(i) any Relevant Purchaser shall become aware that any of the warranties set out in clause 18.1 above was untrue or inaccurate as of the signing of this Agreement; or

(ii) any event shall occur or matter shall arise of which any Relevant Purchaser becomes aware which would result in any of the warranties set out in clause 18.1 above being untrue or inaccurate at Completion had the warranties set out in clause 18.1 above been repeated on Completion,

the Relevant Purchasers shall notify the Relevant Sellers in writing as soon as practicable and in any event prior to Completion setting out full details of the matter and the Relevant Purchasers shall make any investigation concerning the event or matter and take such action, at their own cost, as the Relevant Sellers may reasonably require.

18.3 Any notification pursuant to clause 18.2 above shall not operate as a disclosure pursuant to paragraph 10 of Schedule 5 and the warranties set out in clause 18.1 above shall not be subject to such notification.

18.4 The Relevant Purchasers further warrant to the Relevant Sellers that the warranties set out in clauses 18.1(i) to 18.1(iii) (but not, for the avoidance of doubt, clause 18.1(iv)) above will be true and accurate at Completion as if they had been repeated at Completion.

19. SELLERS’ UNDERTAKINGS

19.1 The Relevant Sellers agree and undertake to provide the Relevant Purchasers (and will use all reasonable endeavours to procure that their auditors provide the Relevant Purchasers) with all such assistance as the Relevant Purchasers reasonably require to produce the Sappi Circular,

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including without limitation in respect of financial information relating to the Business Assets to be included therein.

19.2 Subject to their reasonable external costs being covered by the Relevant Purchasers, the Relevant Sellers agree and undertake to provide the Relevant Purchasers with such assistance as the Relevant Purchasers reasonably require to produce any offering circular or prospectus relating to any Financing, including:

(i) furnishing the Relevant Purchasers with all financial statements and financial data relating to the Business Assets that would be required to be included in the relevant offering circular or prospectus:

(a) under applicable South African or US rules and regulations (and, in the case of an offering of high-yield notes, that are customarily included in offering memoranda for offerings conducted in accordance with Rule 144A and Regulation S in the European high-yield market); or

(b) in order to allow the granting by auditors of negative assurance comfort under SAS 72 ‘look-a-like’;

(ii) using all reasonable endeavours to procure that their auditors provide such accountants’ comfort letters (including a statement that such auditors have conducted a SAS 100 or ISRE 2410 review, as applicable for each relevant offering document, on any interim financial statements included in such offering circular or prospectus) and consents as reasonably requested by the Relevant Purchasers; and

(iii) providing such assistance to the Relevant Purchasers as they may reasonably request in connection with any listing of securities issued in any Financing on the JSE, the London Stock Exchange or an unregulated stock exchange in the European Union, as applicable.

19.3 The Relevant Sellers undertake that as at Completion, the make-up of working capital as between the Xxxxxx Mill, the Kirkniemi Mill, the Stockstadt Mill and the Biberist Mill and as between each different component of working capital shall in each case be in accordance with the ordinary course operations of those xxxxx and in each case consistent with past practice.

19.4 Save as required by law of any relevant jurisdiction (including, for the avoidance of doubt, any disclosure to a Tax Authority), the Relevant Sellers agree not to use or disclose the Business Information to any person other than the Relevant Purchasers after Completion.

19.5 The Relevant Sellers undertake to carry out the Pre-Sale Reorganisation as soon as reasonably practicable following the signing of this Agreement and in any event so as to be completed prior to Completion in accordance with paragraph 6 of Schedule 2 of this Agreement.

19.6 Subject to the Relevant Purchasers indemnifying the Relevant Sellers for any reasonable costs in respect of the same (including, without limitation, any increases in any premiums or the loss of any benefit in relation to any insurance agreement), the Relevant Sellers undertake to use reasonable endeavours to pursue any insurance claim that the Relevant Purchasers may reasonably request that the Relevant Sellers pursue in order to vest the benefit of clause 2.1(x) in the Relevant Purchasers so far as is reasonably practicable.

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19.7 M-real shall use reasonable endeavours to procure that the Xxxxxx PM2 is removed from the Xxxxxx PM2 Property within 3 years of Completion Date and shall ensure that the Xxxxxx PM2 Property is made safe in accordance with normal standards upon the removal of the Xxxxxx PM2. If M-real has not been able to remove the Xxxxxx PM2 and make the Xxxxxx PM2 Property safe within 3 years of the Completion Date, M-real and Sappi agree to enter into a good faith negotiation in order to determine how the Xxxxxx PM2 should be removed from the Xxxxxx PM2 Property, including if appropriate, a discussion as to the extension of the Xxxxxx PM2 Property Lease.

19.8 M-real shall use reasonable endeavours to procure that Biberist shall distribute prior to Completion all its retained earnings as per the Biberist statutory accounts for the year ended 31 December, 2007, insofar as the same are freely distributable and insofar as agreed by M-real and Sappi (the “Biberist Retained Earnings”), subject to the following terms and conditions:

(i) that Biberist has obtained an advance written tax ruling, reasonably satisfactory to both M-real and Sappi, of the Swiss Federal Tax Administration confirming that there is no Swiss dividend withholding treatment of the Biberist Retained Earnings;

(ii) that such tax ruling shall be obtained by the statutory auditor of Biberist (as set out in Schedule 7 (B)) or any other independent person acceptable to M-Real and Sappi and shall be binding upon M-Real and Sappi for the purpose of this Agreement;

(iii) that the statutory auditor of Biberist (as set out in Schedule 7 (B)) confirms (based on an interim balance sheet drawn up as per 30 September, 2008 (or, if the distribution is to be made after 31 December, 2008, based on a balance sheet drawn up as per 31 December, 2008, if available) consistent with the accounting practice of Biberist according to Swiss GAAP) in writing to M-real (who shall provide a copy of such confirmation to Sappi) that the dividend distribution complies with Swiss company law and with the Articles of Association of Biberist; and

(iv) that Biberist shall, at the latest, distribute the Biberist Retained Earnings three Business Days prior to the Completion Date,

provided that M-real and Sappi shall not procure and Biberist shall not be required to make a distribution to an extent which would constitute a repayment of capital (Einlagerückgewähr) or a violation of its legally protected reserves (gesetzlich geschützte Reserven). If such tax ruling can only be obtained after Completion (or if the only tax ruling which can be obtained after Completion is not satisfactory to both M-real and Sappi), M-real shall discuss in good faith what steps can reasonably be taken to ensure Sappi can reasonably procure that the Biberist Retained Earnings are distributed to NL Holding, net of any costs or expenses and net of any amount of Swiss withholding tax which may be deductible in accordance with such ruling or such other steps in relation to the Biberist Retained Earnings as are reasonable.

M-real and Sappi shall procure that the costs (other than in relation to any tax ruling obtained and any costs in relation to confirming the Swiss dividend withholding tax exemption) are borne by Biberist.

19.9 The Relevant Sellers shall be responsible for, and shall indemnify the Relevant Purchasers in respect of any liabilities incurred by the Relevant Purchasers in respect of:

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(i) the Mill Business Efficiency Programme;

(ii) any compensation which is required by a relevant Environment Authority to be paid out in relation to waste water effluent discharges at the Business Property at Kirkniemi in respect of the period on or before Completion (“Kirkniemi Discharge Compensation”);

(iii) any cost ultimately borne by the Relevant Purchaser under clause 23.7(ii) as a result of any relevant payable under clause 23.7 which was due and payable on or before the Completion Date not having been borne by the Relevant Sellers or the relevant member of the Seller’s Group in accordance with clause 23.7(i) except to the extent such cost is a Tax Liability for the purposes of Schedule 14;

(iv) any interest payments which are accrued but not paid in respect of the period on or before Completion by Stockstadt GmbH before the date they are due;

(v) any Pre-Sale Reorganisation Liabilities; and

(vi) any overdue payments which are due in respect of the Graphic Paper Business at Completion or current payments which are more than 60 days from invoice at Completion which have not been paid to the Relevant Purchasers pursuant to supply arrangements with Xxxxxxxxx for a period of 6 months from the date of Completion provided that the Relevant Purchasers have continued to do business with Xxxxxxxxx for so long as it is reasonable and practicable for the Relevant Purchasers to do so. The parties agree that in the event the Sellers’ Group is able to procure credit insurance in respect of the payments the subject of this indemnity prior to Completion this clause 19.9 (vi) shall ceased to have effect. The Purchaser shall procure that forthwith on receipt of any payment pursuant to this indemnity it shall assign or procure the assignment by the relevant member of the Purchaser’s Group of the of the receivable in respect of which the indemnity is paid.

19.10 Prior to Completion, M-real shall cause Deutsche Holding to take all reasonably necessary steps to ensure that the fiscal year of CN Papiervertriebs GmbH and of the German Subsidiary is shortened such that the respective fiscal year ends on or after the Completion Date. M-real shall further procure and take all necessary steps to ensure that the existing domination and profit and loss pooling agreement between Stockstadt GmbH and the German Subsidiary is terminated with legal effect as of the end of the respective shortened fiscal year of the German Subsidiary.

20. PURCHASERS’ UNDERTAKINGS

20.1 Sappi agrees and undertakes to the Relevant Sellers that the Sappi Shares forming the Consideration Shares to be issued shall:

(i) be fully paid or credited as fully paid, rank pari passu in all respects with the Sappi Shares in issue on the Completion Date (including the right to receive all dividends and other distributions declared, made or paid on or after the Completion Date);

(ii) not be issued subject to any pre-emptive right, option, right to acquire, mortgage, charge, pledge, lien or other form of security or encumbrance and all other rights exercisable by or claims by third parties other than at the creation of the Relevant Sellers or any member of the Sellers’ Group; and

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(iii) be issued in accordance with applicable law and the articles of association or by-laws or equivalent constitutional documents of the Purchaser.

20.2 Sappi undertakes to the Relevant Sellers that it and its directors, as at the Completion Date, shall have the power and authority to allot and issue the Consideration Shares to be issued to the Relevant Sellers under this Agreement in the manner contemplated by this Agreement without any sanction or consent by the members of the Purchaser or any class of them and the allotment shall comply with the South African Companies Act No 61 of 1973, the JSE Listings Requirements and all other relevant laws and regulations of South Africa and elsewhere.

20.3 Sappi agrees and undertakes that the Sappi Circular and any other public document issued by it in relation to the transactions contemplated by this Agreement, including for the avoidance of doubt any rights issue or other equity or debt raising, will be issued in accordance with the rules of the JSE and all other relevant laws and regulations of South Africa and elsewhere.

20.4 The Relevant Purchasers agree and undertake that (in the absence of fraud) they have no rights against and shall not make any claim against any employee, director, agent, officer or adviser of any member of the Seller’s Group or any Employee on whom it may have relied before agreeing to any term or entering into this Agreement or any other agreement or document entered into pursuant hereto.

20.5 Without prejudice to clause 28.2, the Relevant Purchasers shall procure that, for a period of six years after Completion, each of the Relevant Sellers and their accountants shall as soon as reasonably practicable and in any event within five Business Days of request for the same be given reasonable access to any employees, officers, advisers or premises of any member of the Group and any of their respective books and records which may reasonably be required by the Sellers or any other member of the Sellers’ Group in connection with any report, return, statement, audit, filing or other requirement under any applicable law or regulation or otherwise required in respect of the Sellers’ Business.

20.6 Without prejudice to clause 19.7, the Relevant Purchaser of the Xxxxxx Property agrees to grant a right of access, in accordance with the Xxxxxx PM2 Property Lease and for the purpose of removing the Xxxxxx PM2 from the Xxxxxx PM2 Property, to M-real or a relevant third party with effect from Completion and for a period of 3 years or such other period until the Xxxxxx PM2 is sold and removed from the Xxxxxx PM2 Property.  The Relevant Purchaser agrees that it will enter into the Xxxxxx PM2 Property Lease in this respect and M-real undertakes that it shall not assign or transfer the Xxxxxx PM2 Property Lease to any third party.

20.7 Sappi will procure that the Rights Issue is formally launched as soon as reasonably practicable after the conditions (other than the condition in paragraph 8 of Schedule 2) in Schedule 2 have been satisfied or waived in full or as otherwise as agreed in writing between M-real and Sappi.

20.8 Sappi undertakes to M-real that it and the other members of the Purchaser’s Group have no secured outstanding debt obligation (whether secured by mortgage, charge, pledge, lien or any other security interest or any other agreement or arrangement having the effect of giving security or preferential ranking to a creditor) other than secured outstanding debt obligations which are permitted under clauses 22.5 (negative pledge) and 22.7 (financial indebtedness) of the €600,000,000 revolving credit facility agreement arranged for Sappi by BNP Paribas, XX Xxxxxx plc and SG Corporate and Investment Banking dated 29 June, 2005 (as amended from time to time) and that the M-real Vendor Loan Note to be issued pursuant to the transactions

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contemplated by this Agreement shall rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors except for obligations mandatorily preferred by law applying to companies generally.

21. RESTRICTIONS ON SELLERS’ BUSINESS ACTIVITIES

21.1 The Relevant Sellers shall, and shall procure that the Sellers’ Group shall cease to use any trade xxxx consisting of or comprising “Galerie Art by Xxxxx-Xxxxx” (“GAMS”) in any jurisdiction.

21.2 The Relevant Sellers shall not, and shall procure that none of the Sellers’ Group shall:

(i) make any further use of the “Xxxxxxx Mega” marks (“ZM”) in any jurisdiction; or

(ii) renew any of the ZM registrations; or

(iii) for a period of 3 years following Completion, use or apply for registration of or register any trade marks including the word Mega for any products or services, except as otherwise agreed in writing between the parties;

(iv) for so long as the Relevant Purchaser continues to have a significant commercial interest in the “MEGA” xxxx, use or apply for registration of or register any trade marks that include the word MEGA in relation to products or services that are the same as or similar to those in relation to which the Relevant Purchaser has used or is using the MEGA xxxx (whether alone or in combination with any other xxxx) in the 3 year period following Completion, except as otherwise agreed in writing between the parties;

(v) use or seek registration of any trade marks including the word Galerie (including Galerie Vision or Galerie Image) except as otherwise agreed in writing by the parties.

21.3 Subject to clause 21.4, the Relevant Sellers undertake that they will not (and to procure no member of the Sellers’ Group will) for a period of three years from the Completion Date be directly or indirectly engaged or interested in carrying on a Coated Graphic Paper Business anywhere in the world.

21.4 Nothing in this clause 21, shall prevent or restrict in any way the Relevant Sellers or any other member of the Sellers’ Group from:

(i) the holding of shares in a listed company if the shares do not confer more than 10 per cent. of the votes which could normally be cast at a general meeting of the company, provided that this sub-clause (i) shall not apply to the holding of any shares in Sappi;

(ii) carrying on anywhere in the world the Sellers’ Business (for the avoidance of doubt, including, without limitation, paperboard, uncoated graphic paper production, coated speciality paper, cast coated paper and one-sided coated paper);

(iii) acquiring any entity or business which carries on a Coated Graphic Paper Business as it is carried on at the date of Completion if the acquisition is not made with the sole or main purpose of acquiring a Coated Graphic Paper Business and the Coated Graphic Paper Business element of the entity or business to be acquired does not comprise more than

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30 per cent. of turnover of such entity or business taken as a whole and represent production of more than 200,000 tonnes per annum; and

(iv) carrying on any business contemplated by this Agreement and obligations under agreements contemplated by this Agreement, provided that the restrictions in the 3 year period from Completion set out in this clause 21 shall apply to the Äänekoski PM2 Exclusive Marketing Agreement in the event that agreement is terminated prior to 3 years from the Completion Date.

21.5 In the event that a member of the Sellers’ Group acquires an entity or business which carries on a Coated Graphic Paper Business in excess of the turnover and production limits set out in clause 21.4(iii), M-real shall be required to sell or procure the sale of such Coated Graphic Paper Business within six months of the acquisition thereof and, in respect of such disposal, the Purchaser shall be granted a right of first refusal to acquire such Coated Graphic Paper Business provided that any acquisition by the Purchaser shall be at the same price and on materially similar terms as any third party would be prepared to agree to.

21.6 The restrictions in the three year period from Completion set out in this clause 21 shall not apply to restrict:

(i) any business whatsoever carried out by Xxxxxxx at its Gohrsmühle Mill or by Hallein AG at its Hallein Mill in accordance with any of the Transaction Documents in respect of any production at such xxxxx which is not sold by the Relevant Purchasers;

(ii) any production at the Gohrsmühle Mill or the Hallein Mill in the 4 months following Completion which is not sold by the Relevant Purchasers; and

(iii) any business carried out by the Sellers’ Group which relates to the Excluded SA Assets.

22. NON-SOLICITATION

22.1 The Relevant Sellers undertake to the Relevant Purchasers that they will not, and shall procure that each member of the Sellers’ Group will not, within 12 months after the Completion Date solicit or entice away from the employment of any member of the Group, or engage or employ (directly or indirectly, in any capacity whatsoever) any Senior Employee (save where such solicitation or enticement is as a result of an advertisement or advertisements not specifically targeted at such persons or as a result of an unsolicited approach to M-real or any other member of the Sellers’ Group from such person).

22.2 The Relevant Purchasers undertake to the Relevant Sellers that they will not, and shall procure that each member of the Purchaser’s Group will not, within 12 months after the Completion Date solicit or entice away from the employment of any member of the Sellers’ Group or engage or employ (directly or indirectly, in any capacity whatsoever) any Senior Employee (save with the Seller’s prior consent (not to be unreasonably withheld or delayed) or save where such solicitation or enticement is as a result of an advertisement or advertisements not specifically targeted at such persons or as a result of an unsolicited approach to the Purchaser or any other member of the Purchaser’s Group from such person).

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23. EMPLOYEES

23.1 The parties anticipate that mandatory provisions of applicable legislation relating to the transfer of undertakings will apply to the sale of the Mill Business and the contracts of employment (and all rights and obligations thereunder including where relevant pension obligations) of the Business Employees will upon Completion, to the extent provided for in the said applicable legislation, transfer to the Relevant Purchasers.

23.2 Subject to clauses 23.3 and 23.4, and notwithstanding mandatory provisions of applicable legislation relating to the transfer of undertakings, if the contract of employment of any Business Employee terminates or is found or alleged not to have effect after Completion as if made with the Purchaser or another member of the Purchaser’s Group as a consequence of the sale and purchase of the Mill Business and other matters contemplated under this Agreement, the Purchaser and the Relevant Sellers agree that:

(i) the Relevant Purchasers (on behalf of the relevant member of the Purchaser’s Group), in consultation with the Relevant Sellers, may, within five Business Days of being so requested by the Relevant Seller, make (or procure that another member of the Relevant Purchaser’s Group makes) to such a Business Employee an offer in writing to employ him under a new contract of employment; and

(ii) the offer to be made will be such that it is consistent with the terms and conditions the said Business Employee would have enjoyed had he or she transferred as originally anticipated under the mandatory provisions of applicable legislation.

23.3 Without prejudice to clause 23.7, the Relevant Sellers shall indemnify the Relevant Purchasers against any claim in respect of:

(i) the employment of any Business Employee during the period before the Completion Date;

(ii) any termination of the employment of any Business Employee by any member of the Sellers’ Group before the Completion Date;

(iii) any failure by any member of the Sellers’ Group to comply with its obligations under applicable legislation to provide information or to consult, in connection with the transfer and/or other matters contemplated by this Agreement, in relation to the Business Employees.

23.4 The Relevant Purchasers shall indemnify the Relevant Sellers against any claim in respect of:

(i) the employment of any Business Employee during the period after the Completion Date including, without limitation, any changes to terms and conditions of employment by the Relevant Purchaser;

(ii) subject to paragraph 23.5, any termination of the employment of any Business Employee by a Relevant Purchaser after the Completion Date; and

(iii) any failure by a Relevant Purchaser to comply with its obligations under applicable legislation to provide information with respect to the measures, in connection with the

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transfer, which a Relevant Purchaser will take, if any, in relation to any Business Employees who will become employees of the Purchaser’s Group after Completion.

23.5 If for any reason the contract of employment of any person who is not an Employee is found or alleged to have effect after the date of this Agreement as if made with a Relevant Purchaser or another member of the Purchaser’s Group, as a consequence of the sale and purchase of the Business Assets and other matters contemplated under this Agreement, the Relevant Purchaser and Relevant Sellers agree that:

(i) the Relevant Sellers will, within 5 Business Days of being so requested by the Relevant Purchaser, either make to that person an offer in writing to employ him under a new contract of employment or notify the Relevant Purchaser that it will not make such an offer; and

(ii) any such offer made will be such that none of the terms and conditions of the new contract will differ from the corresponding terms of that individual’s contract of employment immediately before Completion.

23.6 Once the offer referred to in clause 23.5 has been made or the Relevant Seller has confirmed that it will not make any such offer (or after the expiry of five Business Days after it has been requested), the Relevant Purchaser shall terminate (or procure the relevant member of the Purchaser’s Group so terminates) the employment of the person concerned and, so long as notification of that termination is made within three months of the Relevant Purchaser becoming aware of the finding or allegation referred to in clause 23.5, the Relevant Sellers will pay to the Relevant Purchasers such amount as is required to indemnify the Relevant Purchasers or the relevant member of the Purchaser’s Group against the cost of that person’s employment, the termination of that employment and any liabilities or costs relating to that person which transfer to the Relevant Purchaser or a member of the Purchaser’s Group under applicable legislation.   The Relevant Purchaser or member of the Purchaser’s Group shall use all reasonable endeavours to minimise the cost of terminating such person’s employment as are consistent with local law.

23.7 All wages, salaries, incentive payments, holiday pay, and other periodic outgoings (including any Employment Taxes for which the employer is required to account in respect of such payments) in respect of the Business Employees to the extent that they are due and payable (in accordance with the usual practice of the Graphic Paper Business):

(i) on or before the Completion Date shall be borne by the Relevant Sellers or the relevant member of the Sellers’ Group; and

(ii) after the Completion Date shall be borne by the Relevant Purchasers or the relevant member of the Purchaser’s Group,

provided that any bonuses (including, for the avoidance of doubt, MIS Payments and thirteenth cheques) which relate to a period:

(a) on or before the Completion Date shall be borne by the Relevant Sellers or the relevant member of the Sellers’ Group; and

(b) after the Completion Date shall be borne by the Relevant Purchasers or the relevant member of the Purchaser’s Group.

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23.8 For the avoidance of doubt, responsibility for any Employment Taxes relating to wages, salaries, incentive payments, holiday pay, other outgoings and bonuses mentioned in clause 23.7 shall be allocated in accordance with the principles set out in paragraph 3.2 of the Tax Indemnity.

24. FURTHER UNDERTAKINGS

24.1 M-real and Sappi have a definitive plan to sell and transfer the Coaters to Sappi, subject to and in accordance with applicable legal and contractual requirements in the relevant jurisdictions, including any applicable labour law requirements or (in Germany) agreements with works’ council.

24.2 Notwithstanding clause 24.1, any transfer of the Coaters and the Know-How Business shall be subject to the following principles:

(i) the Sellers shall (or shall procure that the relevant employing entity shall) take all lawful steps necessary to ensure that no employee transfers to any member of the Purchaser’s Group, pursuant to the terms of any legislation relating to the transfer of undertakings and the acquisition (if any) of the Coaters and/or the Know-How Business;

(ii) notwithstanding clause 24.2(i), and for the avoidance of any doubt, clauses 23.5(i) and (ii) and 23.6 of this Agreement shall apply to any employee who transfers, or alleges that he/she transferred, to any member of the Purchaser’s Group contrary to clause 24.2(i) above (and such employee shall not be considered to be an “Employee” for the purposes of that clause).

24.3 With effect as of the Completion Date, the relevant parties agree to use reasonable endeavours to terminate any cash pooling arrangement in place prior to Completion.

24.4 The parties anticipate that the sale and transfer of the Hallein Coater hereunder to the Relevant Purchaser will not constitute a transfer of business in terms of section 38 of the Austrian Company’s Act (Unternehmensgesetzbuch; “UGB”).  If the sale and transfer of the Hallein Coater hereunder to the Relevant Purchaser should be found to constitute a transfer of business in terms of section 38 UGB the parties agree as follows:

(i) the Relevant Purchaser shall not assume any liabilities from Hallein AG under section 38 UGB resulting from the transfer of the Hallein Coater to the Relevant Purchaser;

(ii) the Relevant Seller shall, to the extent legally permissible, register the exclusion of liability set forth in sub-clause (i) immediately after Completion with the competent commercial register or otherwise notify creditors thereof in accordance with section 38 paragraph 4 UGB. The Relevant Seller shall indemnify the Relevant Purchaser from any damages resulting out of or in connection with a breach of the registration/publicity obligations set forth in this clause 24.4(ii);

(iii) the Relevant Seller agrees to pay the Relevant Purchaser an amount equal to the amount of any liability of Hallein AG for which the Relevant Purchaser is or becomes liable by operation of section 38 UGB.

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25. SELLERS’ MARKS

25.1 If any materials are delivered or supplied to the Purchasers under this Agreement bearing the Sellers’ Marks, the Purchasers are authorised by the Relevant Sellers to sell or otherwise dispose of those materials or to use that material for a period of 6 months immediately following Completion.  After the expiry of this period, the Relevant Purchasers shall immediately destroy or remove or obliterate the Sellers’ Marks from the materials (including, but without limitation, other materials sales literature and stationery or buildings, signage or vehicles bearing any of the Sellers’ Marks).

25.2 Without prejudice to the trade xxxx rights of the Sellers’ Group, the Relevant Purchaser shall procure that for:

(i) a minimum period of three years following Completion; and

(ii) thereafter for so long as any member of the Sellers’ Group continues to retain an interest in the Sellers’ Marks,

no member of the Purchaser’s Group shall use (including, without limitation, use as a domain name or part of a domain name) any Sellers’ Marks or any confusingly similar name or xxxx in any business which competes with the business of the Sellers’ Group.

25.3 The Relevant Purchasers acknowledge and agree that, subject to clause 26.1, nothing in this Agreement shall transfer or licence, or shall operate as an agreement to transfer or licence, any right, title or interest in or to the use of Sellers’ Marks or any associated logo or device which any member of the Sellers’ Group owns, or any confusingly similar name or xxxx.  Following Completion, the Relevant Purchasers shall not, and shall procure that no member of the Purchaser’s Group shall, hold itself out as being part of or in any way connected with any Relevant Seller and/or the Sellers’ Group.

26. INTELLECTUAL PROPERTY

26.1 If any of the Group Companies owns after Completion any Intellectual Property or rights in Business Information which in the year prior to Completion was used exclusively in the business of the Sellers’ Group, the Relevant Purchasers shall procure that such Intellectual Property and/or rights in Business Information are transferred to a company nominated by the Relevant Sellers for nominal consideration as soon as practicable after becoming aware of the ownership of such rights.

26.2 If any of the Sellers’ Group own after Completion any Intellectual Property or rights in Business Information which in the year prior to Completion was used exclusively in the business of the Group or the Business (excluding the Sellers’ Marks), the Relevant Sellers shall procure that such Intellectual Property and/or rights in Business Information are transferred to a company nominated by the Relevant Purchasers for nominal consideration as soon as practicable after becoming aware of the ownership of such rights.

26.3 The Relevant Purchasers hereby grant and shall procure the grant by each relevant member of the Purchaser’s Group to the Relevant Sellers, with effect from Completion, a non-exclusive, perpetual, worldwide, assignable (but with no right to grant sub-licences), royalty-free licence of all Intellectual Property (as acquired in this transaction, but excluding trade marks, trade names

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and logos except in accordance with clause 26.6) and rights in Business Information owned by the Relevant Purchasers or a member of the Purchaser’s Group after Completion in so far as such licence is reasonably necessary for the business of the Sellers’ Group.  For the avoidance of doubt, this excludes Intellectual Property and rights in Business Information related to coated wood-free paper, except in accordance with the Transaction Documents.

26.4 The Relevant Sellers hereby grant, and shall procure the grant by each relevant member of the Sellers’ Group to the Relevant Purchaser, with effect from Completion, a non-exclusive, perpetual, worldwide, assignable (but with no right to grant sub-licences) royalty-free licence of all Intellectual Property and rights in Business Information owned by the Relevant Sellers or a member of the Sellers’ Group insofar as such licence is reasonably necessary for the business of the Companies or the Business (excluding the Sellers’ Marks).

26.5 Each of the Relevant Purchasers and Relevant Sellers agree that, and the Relevant Sellers shall procure that, (save for any licences intended to continue in accordance with the terms of the Transitional Services Agreement) all licences of any Intellectual Property or rights in Business Information:

(i) owned by any of the Group Companies or to be owned by the Relevant Purchasers or their nominees pursuant to this Agreement (or any associated Transaction Documents) and licensed to any member of the Sellers’ Group; or

(ii) owned by the Sellers’ Group or to be owned by the Relevant Sellers or their nominees pursuant to this Agreement (or any associated Transaction Documents) and licensed to any member of the Purchaser’s Group,

(other than licences granted pursuant to any Transaction Document) terminate at Completion.

26.6 The Relevant Purchasers agree to grant to each of the Relevant Sellers, with effect from Completion, non-exclusive, royalty-free licences (with no right to grant sub-licences) of the:

(i) marks GALERIE VISION and GALERIE IMAGE for use on board products similar to those currently produced on the Äänekoski Board Machine by the Seller’s Group for a period of 12 months following Completion;

(ii) xxxx GALERIE ART on and in relation to the wood-free coated Äänekoski PM2 Goods produced at the Äänekoski Mill, as that business was carried on (in terms of scale and scope) at Completion, such goods to be distributed exclusively through the Relevant Purchasers during the life of the Äänekoski Transitional Agreement and, post termination of that agreement, the licence to include the right to offer for sale, distribute and sell the Äänekoski PM2 Goods;

(iii) marks ERA SILK and ERA GLOSS on and in relation to coated paper products for a transition period, expiring at such time as the Relevant Purchasers are able to transfer production of this product to its own paper machines; and

(iv) xxxx ERA on and in relation to uncoated paper products as currently produced by the Seller’s Group,

such licences to be on reasonable commercial terms and to be executed prior to Completion.

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27. INSURANCE

The Relevant Purchasers acknowledge and agree that upon Completion all insurance cover provided in relation to the Business and the assets of the Group pursuant to the Sellers’ Group Insurance Policies shall cease.

28. BOOKS AND RECORDS

28.1 On the Completion Date the Relevant Sellers shall deliver to, or hold to the order of, the Relevant Purchasers originals of all the Books and Records which constitute Business Assets excluding:

(i) those Books and Records which any member of the Sellers’ Group is required by law to retain; and

(ii) all Books and Records of the Relevant Sellers which contain legally privileged information which is confidential to the Sellers,

all of which shall be retained by the Sellers.

28.2 The Relevant Purchasers acknowledge that the Relevant Sellers will wish to inspect and/or copy the Books and Records delivered to the Relevant Purchasers under this Agreement, and the books and records and accounts of the Group Companies, for the purpose of dealing with any report, return, statement audit, filing or other requirement under any applicable law or regulation, its Tax affairs or any third party claim or otherwise required in respect of the Sellers’ Business and, accordingly, the Relevant Purchasers shall, upon having given reasonable notice by the Relevant Sellers and subject to the Relevant Sellers giving such undertaking as to confidentiality as the Relevant Purchasers shall reasonably require, make such Books and Records, and such books and records and accounts of the Group Companies, available to the Relevant Sellers (or their professional advisers) for inspection (during Working Hours) and copying (at the Relevant Sellers’ expense) in each case only to the extent necessary for such purpose until the later of:

(i) six years from Completion; or

(ii) final settlement with the Tax Authorities of any claims relating to Tax for which the Sellers might be liable under this Agreement.

28.3 In respect of any Books and Records not delivered to the Relevant Purchasers or any accounting or Tax records which contain information which relates in part (but not exclusively) to the Business or which relate exclusively to the Business but do not constitute Business Assets, the Relevant Sellers shall, upon having been given reasonable notice by the Relevant Purchasers or their agents, make that part of such Books and Records (including accounting or Tax records which do relate to the Business) available to the Relevant Purchasers or their agents for inspection (during Working Hours) and copying (at the Relevant Purchasers expense) for a period of six years from Completion but excluding any to the extent that they contain legally privileged information which is confidential to the Relevant Sellers.

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29. SET-OFF

Any payment to be made by any party under this Agreement shall be made in full without any set-off, restriction, condition or deduction for or on account of any counterclaim.

30. EFFECT OF COMPLETION

Save as otherwise provided herein, any provision of this Agreement or of any other document referred to herein which is capable of being performed after but which has not been performed at or before Completion and all Warranties contained in, or entered into pursuant to, this Agreement shall remain in full force and effect notwithstanding Completion.

31. REMEDIES AND WAIVERS

31.1 Except as provided in Schedule 5, no delay or omission on the part of either party to this Agreement in exercising any right, power or remedy provided by law or under this Agreement or any other documents referred to in it shall impair such right, power or remedy or operate as a waiver thereof.

31.2 Except as provided in Schedule 5, the single or partial exercise of any right, power or remedy provided by law or under this Agreement shall not preclude any other or further exercise thereof or the exercise of any other right, power or remedy except where expressly stated herein.

31.3 Except as otherwise expressly provided in this Agreement, the rights, powers and remedies provided in this Agreement are cumulative and not exclusive of any rights, powers and remedies provided by law.

32. ASSIGNMENT

32.1 Obligations under this Agreement shall not be transferable.

32.2 The benefits of this Agreement shall not be assignable except that any party may, upon giving written notice to the others, assign the benefit of this Agreement to a member of the Sellers’ Group or the Purchaser’s Group, as the case may be, (a “Permitted Assignee”) provided that such assignment shall be without cost to, and shall not result in any increased liability, or any reduction in the rights, of, any of the other parties and further provided that if such Permitted Assignee shall subsequently cease to be a member of the Purchaser’s Group or the Sellers’ Group, as the case may be, the original assigning party shall procure that prior to the Permitted Assignee ceasing to be a member of the Purchaser’s Group or the Sellers’ Group, as the case may be, it shall assign so much of the benefit of this Agreement as has been assigned to it to the party by whom such rights were originally assigned or (upon giving further written notice to the other parties) to another member of the Purchaser’s Group or the Sellers’ Group, as the case maybe.  Any purported assignment in contravention of this clause shall be void.

33. FURTHER ASSURANCE

33.1 Without prejudice to any restriction or limitation on the extent of any party’s obligations under this Agreement, and except in relation to the Business Intellectual Property, each of the parties shall from time to time so far as each is reasonably able do or procure the doing of all such acts and/or execute or procure the execution of all such documents in a form reasonably satisfactory to the

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party concerned as they may reasonably consider necessary to transfer the Shares and the Business Assets to the Relevant Purchasers or otherwise to give the other party the full benefit of this Agreement.

33.2 The Relevant Sellers undertake after Completion and at the request of the Relevant Purchasers to execute or procure the execution of all such documents as may reasonably be necessary to secure the vesting in the Relevant Purchasers (or a member of the Purchaser’s Group) of the Business Intellectual Property, provided that the Relevant Purchasers undertake to the Relevant Sellers that they will be responsible for preparing all such documents and provided further that the Relevant Purchasers shall be responsible for all costs and expenses in respect of such vesting.

34. ENTIRE AGREEMENT

34.1 This Agreement and any other documents entered into pursuant to this Agreement (including, for the avoidance of doubt, any local transfer agreements) constitute the whole and only agreement between the parties relating to the sale and purchase of the Business Assets and the Shares and, save if and only to the extent expressly repeated in this Agreement, supersedes and extinguishes any prior drafts, agreements, undertakings, representations, warranties and arrangements of any nature whatsoever, whether or not in writing, relating thereto.

34.2 Each party acknowledges that in entering into this Agreement and any other documents entered into pursuant to this Agreement it is not relying on and has not been induced to enter into this Agreement or any other such document on the basis of any Assurance made or given by any other party or any other person, whether or not in writing, prior to the date hereof, which is not expressly set out in this Agreement or any other such document or, to the extent that it has been, it has (in the absence of fraud) no rights or remedies in relation thereto.

34.3 This Agreement may only be varied by a document signed by each of the parties and expressed to be a variation to this Agreement.

34.4 To the extent that any provision of any agreement entered into for the purposes of transferring Business Assets and Shares located in a particular jurisdiction or country is inconsistent with any provision of this Agreement, the provisions of this Agreement shall prevail.

35. RIGHTS OF THIRD PARTIES

35.1 Save as contemplated by clause 35.2 , the parties to this Agreement do not intend that any term of this Agreement should be enforceable, by virtue of the Contracts (Rights of Third Parties) Xxx 0000, by any person who is not a party to this Agreement.

35.2 The provisions of clauses 17.6 and 20.4 are intended to be enforceable by each such person by virtue of the Contracts (Rights of Third Parties) Xxx 0000.

35.3 This Agreement may be amended or varied in any way and at any time by the parties to this Agreement without the consent of any person referred to in clause 35.2.

36. NOTICES

36.1 Any notice or other communication given or made under or in connection with the matters contemplated by this Agreement shall be in writing.  Telexes and faxes are not permitted.

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36.2 Any such notice or other communication shall be addressed as provided in clause 36.3 and, if so addressed, shall be deemed to have been duly given or made as follows:

(i) if sent by personal delivery, upon delivery at the address of the relevant party; or

(ii) if sent by courier, two Business Days after the date of posting,

PROVIDED THAT any notice or other communication given or made to M-real shall be deemed to be given or made to each of the other Relevant Sellers and any notice or other communication given or made to Sappi shall be deemed to be given or made to the other Relevant Purchasers and if, in accordance with the above provisions, any such notice or other communication would otherwise be deemed to be given or made outside Working Hours, such notice or other communication shall be deemed to be given or made at the start of Working Hours on the next Business Day.

36.3 The relevant addressee and address of each party for the purposes of this Agreement, subject to clause 36.4, are:

Name of Party		Address
M-real Corporation For the attn. of: Xxxxx Xxxxxx with a copy to Esa Xxxxxxxxx		Xxxxxxxxxxxxx 0 00000 Xxxxx, Xxxxxxx X.X. Xxx 00, XXX-00000 Xxxxx, Xxxxxxx
Sappi Limited For the attn of: Xxxxxx Hope with a copy to Xxx Xxxx		Sappi House 00 Xxxxxxxx Xxxxxx Xxxxxxxxxxxx Xxxxxxxxxxxx Xxxxx Xxxxxx

36.4 A party may notify any other party to this Agreement of a change to its name, relevant addressee or address for the purposes of clause 36.3 PROVIDED THAT such notification shall only be effective on:

(i) the date specified in the notification as the date on which the change is to take place; or

(ii) if no date is specified or the date specified is less than five  Business Days after the date on which notice is given, the date falling five Business Days after notice of any such change has been given.

36.5 For the avoidance of doubt, the parties agree that the provisions of this clause 36 shall not apply in relation to the service of any written, summons, order, judgment or other document relating to or in connection with any Proceedings.

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37. ANNOUNCEMENTS

37.1 Subject to clause 37.2, no announcement concerning the sale or purchase of the Shares and the Business Assets or any ancillary matter (other than the Sappi Circular and the Press Announcements and the announcement by Sappi of the outcome of the extraordinary general meeting to which the Sappi Circular relates) shall be made by any party without the prior written approval of each other party, such approval not to be unreasonably withheld or delayed.

37.2 Any party may make an announcement concerning the sale or purchase of the Shares and the Business Assets or any ancillary matter if required by:

(i) the law of any relevant jurisdiction;

(ii) any securities exchange or regulatory or governmental body to which any party is subject or submits, wherever situated (including, without limitation, the Finnish Stock Exchange, the JSE, the UK Listing Authority, the London Stock Exchange, the European Commission, any Competition Authority and any Tax Authority), whether or not the requirement has the force of law,

in which case the party concerned shall take all such steps as may be reasonable and practicable in the circumstances to agree the contents of such announcement with the other party before making such announcement and PROVIDED THAT any such announcement shall be made only after notice to each other party.

37.3 The restrictions contained in this clause 37 shall continue to apply after the termination of this Agreement without limit in time.

38. CONFIDENTIALITY

38.1 Without prejudice to the Confidentiality Agreement and subject to clause 38.2 and clause 37, each party shall treat as strictly confidential all information received or obtained as a result of entering into or performing this Agreement which relates to:

(i) the provisions or the subject matter of this Agreement or any document referred to herein;

(ii) the negotiations relating to this Agreement or any document referred to herein;

(iii) (in the case of the Relevant Purchasers) the Sellers’ Group, (in the case of the Relevant Sellers only) the Purchaser’s Group and the business carried on by each member of each of them respectively.

38.2 Any party may disclose information which would otherwise be confidential if and to the extent:

(i) required by the law of any relevant jurisdiction or for the purpose of any judicial proceedings;

(ii) required by any securities exchange or regulatory or governmental body to which any party is subject or submits, wherever situated, including (without limitation) the Finnish Stock Exchange, the JSE, the UK Listing Authority, the London Stock Exchange, the

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European Commission, any Competition Authority and any Tax Authority, whether or not the requirement for information has the force of law;

(iii) that the information is disclosed on a strictly confidential basis to the professional advisers, auditors and/or bankers of that party;

(iv) that the information has come into the public domain through no fault of that party;

(v) that the other party has given prior written approval to the disclosure, such approval not to be unreasonably withheld or delayed;

(vi) it does so to a member of the Sellers’ Group (in the case of the Relevant Sellers) or a member of the Purchaser’s Group (in the case of the Relevant Purchasers) which accepts restrictions in the terms of this clause; or

(vii) required to enable that party to enforce its rights under this Agreement,

PROVIDED THAT any such information disclosed pursuant to paragraphs (i) or (ii) shall be disclosed only after notice to the other party.

38.3 Confidential information shall only be used for the purposes of the negotiations or performance of obligations under this Agreement and not for any other purpose whatsoever.

38.4 Confidential information which may reasonably be considered as competitively sensitive shall only be exchanged subject to strict confidentiality rules so as to ensure that such exchange is in full compliance of anti-trust laws including for the avoidance of doubt Article 81 EC.  Without prejudice to the generality of the foregoing, exchanges of competitively sensitive information may be restricted where appropriate only to external advisors on an external counsel basis.

38.5 The restrictions contained in this clause shall continue to apply after the termination of this Agreement without limit in time.

39. COSTS AND EXPENSES

39.1 Save as otherwise stated in this clause 39 and in any other provision of this Agreement, M-real and Sappi shall pay their own costs and expenses in relation to the negotiations leading up to the sale of the Shares and the Business Assets and to the preparation, execution and carrying into effect of this Agreement and all other documents entered into pursuant to it.

39.2 Subject to a maximum payment of €1,000,000 by Sappi, Sappi agrees that it shall bear 50 per cent. of the costs of PricewaterhouseCoopers in relation to the preparation of the Carve-Out Accounts.

39.3 Without prejudice to clause 39.1, and notwithstanding the provisions of Schedule 14, all merger control authority costs, stamp, transfer (including property transfer taxes), registration, and other similar taxes, duties and charges (including, for the avoidance of doubt, stamp duty pursuant to the Austrian Stamp Duty Act (Gebührengesetz) as interpreted under the Stamp Duty Guidelines of the Austrian Ministry of Finance (Gebührenrichtlinien)), costs and all notarial fees payable in connection with the sale or purchase of the Shares, and the Business Assets under this Agreement and all other documents entered into pursuant to it (including, for the avoidance of

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doubt, any issue or transfer of the Vendor Loans, the Consideration Shares or provision of the M-real Vendor Loan Note in accordance with this Agreement) shall be paid by the Relevant Purchasers (or the relevant Group Companies, as the case may be) and shall not be recoverable from the Sellers under any provision of this Agreement (including, without limitation, any provision of Schedule 14).

40. INDUCEMENT FEE

If Completion does not occur only because of a failure to satisfy the conditions set out in paragraph 2 of Schedule 2, the Purchaser shall by way of compensation pay or procure the payment to M-real of a sum of €2,000,000 (the “Inducement Fee”).

41. COUNTERPARTS

41.1 This Agreement may be executed in any number of counterparts, and by the parties on separate counterparts, but shall not be effective until each party has executed at least one counterpart.

41.2 Each counterpart shall constitute an original of this Agreement, but all the counterparts shall together constitute but one and the same instrument.

42. INVALIDITY

If at any time any provision of this Agreement is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, that shall not affect or impair:

(i) the legality, validity or enforceability in that jurisdiction of any other provision of this Agreement; or

(ii) the legality, validity or enforceability under the law of any other jurisdiction of that or any other provision of this Agreement.

43. HUSUM PM8 COATER CALL OPTION

43.1 Subject to clause 43.2, the Relevant Purchasers shall have an option (the “Option”) of purchasing the Husum PM8 Coater from the Relevant Seller for the amount in clause 43.2 below (together in each case with an amount equal to any VAT properly chargeable in connection therewith, against delivery of an appropriate VAT invoice) (the “Purchase Price”) on the terms and subject to this clause 43.

43.2 Without prejudice to clause 43.8, the Purchase Price shall be adjusted in the following situations:

(i) if Sappi exercises the Option in the period following six months from the Completion Date but before the end of the period ending 27 months after the Completion Date, the Purchase Price shall be €20,000,000;

(ii) if Sappi exercises the Option in the period after 27 months from the Completion Date to 31 September, 2011 (inclusive) the Purchase Price shall be €49,000,000;

(iii) if Sappi exercises the Option in the period from and including 1st October 2011 to and including 31 December 2011, the Purchase Price shall be €48,000,000; and

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(iv) if Sappi exercises the Option after 31 December, 2011 the Purchase Price as reduced  pursuant to paragraph (iii) above, shall further be reduced by an amount of €325,000 per month (and pro rata for any part thereof)starting with the month commencing 1 January, 2012.

43.3 The duration of the Option will lapse upon the expiry of five years following the Completion Date and is exercisable in whole but not in part by notice in writing from the Relevant Purchaser to the Relevant Seller given at any time during the period from and including the date on which the Relevant Sellers notify the Relevant Purchasers of a proposed sale, transfer or disposition of Husum Mill’s PM8 to a third party (the “Third Party”) (which notification shall be given promptly upon indicative terms to sell Husum Mill’s PM8 having been discussed with the Third Party) to and including the date falling thirty days thereafter.

43.4 Upon exercise of the Option, the sale and purchase of the Husum PM8 Coater shall be conditional upon the completion of the sale of Husum Mill’s PM8 to the Third Party whereupon (subject to clause 43.6 below) the Relevant Seller shall, subject to obtaining any security it reasonably requires in relation to any deferred consideration in respect of the sale, sell, or procure the sale, and the Relevant Purchaser shall purchase, or procure the purchase, of the Husum PM8 Coater.

43.5 The consideration for the sale and purchase of the Husum PM8 Coater shall be paid not later than 27 months following Completion unless the provisions of clause 43.8 apply in which event the consideration shall be paid on the completion of the sale referred to in that clause if earlier. Upon the transfer of the Husum PM8 Coater the Relevant Seller shall deliver to the Relevant Purchaser duly executed transfers in respect of the Husum PM8 Coater, together with the relevant certificates or other documents of title.

43.6 Upon exercise of the Option the Relevant Seller shall sell the Husum PM8 Coater with full title guarantee, free from encumbrances and with all rights then or subsequently attaching to it and the Relevant Seller shall execute and deliver other documents and take other steps at the reasonable request and cost of the Relevant Purchaser following completion where this is required to vest the Husum PM8 Coater in the Relevant Purchaser and otherwise to give it the full benefit of this clause 43. While the Option remains exercisable, then save as arising by operation of law in the ordinary course of business, the Relevant Seller shall not encumber or dispose of the Husum PM8 Coater or any interest in it except in accordance with this clause 43.

43.7 The Relevant Seller undertakes not to agree to sell, transfer or otherwise dispose of all or any part of the Husum Mill or the Husum Mill’s PM8 in the first six months following Completion.

43.8 If Sappi sells the Husum PM8 Coater within a year of completing the sale and purchase thereof, M-real shall be entitled to 50 per cent. of the excess of the sale proceeds over and above the Purchase Price (plus any costs associated with the sale and purchase) paid by the Relevant Purchaser for the Husum PM8 Coater.

44. SOUTH AFRICA OPTION

44.1 The Relevant Purchaser shall have an option to purchase the Excluded SA Assets and the SA Customer Lists from the Relevant Seller (the “SA Option”) and the Relevant Sellers shall have the right to require that the Relevant Purchasers purchase the Excluded SA Assets and the SA

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Customer Lists from the Relevant Seller (the “SA Put”), in each case on the terms of this clause 44.

44.2 The SA Option or the SA Put may be exercised by the relevant party at any time following the thirtieth Business Day after Completion.

44.3 Consideration payable by the Relevant Purchaser to the Relevant Seller upon completion of the SA Option or the SA Put, as the case may be, shall be €983,754 (together with an amount equal to any VAT properly chargeable in connection therewith, against delivery of an appropriate VAT invoice).

44.4 The SA Option and the SA Put shall be exercisable in whole but not in part by notice in writing from the Relevant Purchaser to the Relevant Seller (in the case of the SA Option) or from the Relevant Seller to the Relevant Purchaser (in the case of the SA Put) and once exercised, completion of the SA Option or the SA Put, as the case may be, shall be conditional only upon receipt of any necessary regulatory approvals and clearances.

44.5 Upon exercise of the SA Option or the SA Put, as the case may be, the transfer of the Excluded SA Assets and the SA Customer Lists shall take place mutatis mutandis on the terms of this Agreement and the Relevant Seller shall execute and deliver such documents and take such steps at the reasonable request and cost of the Relevant Purchaser following Completion where this is required to vest the Excluded SA Assets and the SA Customer Lists in the Relevant Purchaser and otherwise to give it the full benefit of this clause 44.

44.6 Other than in the ordinary course of business, the Relevant Seller shall not encumber or dispose of the Excluded SA Assets and the SA Customer Lists or any interest in any of them except in accordance with this clause 44.

45. XXXXXX PROPERTY OPTION

45.1 In consideration of the payment by M-real to Sappi of €1, Sappi grants to M-real the option to acquire the Xxxxxx Property in the event of a permanent cessation of manufacturing paper at the Xxxxxx Mill (a “Permanent Cessation”) for a purchase price and subject to the terms and conditions of this clause 45 and subject to terms and conditions of any property transfer deed to be entered into by the parties (the “Xxxxxx Property Option”).

45.2 Sappi shall serve notice on M-real of the Permanent Cessation as soon as reasonably practicable after the cessation, however not later than within three months after the Permanent Cessation. At any time thereafter, M-real may serve notice on Sappi indicating that M-real desires to exercise the Xxxxxx Property Option.

45.3 Should M-real serve notice pursuant to clause 45.2 to exercise the Xxxxxx Property Option for the purpose of acquiring the Xxxxxx Property for further commercial or industrial use, the purchase price to be paid by M-real for the Xxxxxx Property shall be the average of the three separate and independent valuations of the Xxxxxx Property as outlined below (together with an amount equal to any VAT properly chargeable in connection therewith, against delivery of an appropriate VAT invoice). M-real and Sappi agree that for the purpose of ascertaining the purchase price to be paid for the Xxxxxx Property each party will carry out the following valuations (each of which shall be addressed to M-real and Sappi in accordance with the details

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set out in clause 36) within 20 Business Days of the notice served by M-real pursuant to clause 45.2:

(i) Sappi shall commission two separate and independent valuations of the Xxxxxx Property; and

(ii) M-real shall commission one independent valuation of the Xxxxxx Property,

provided that in each case the valuation shall be carried out with reference to use of the Xxxxxx Property for commercial or industrial use.

45.4 Once the purchase price is determined pursuant to clause 45.3, the transfer of the Xxxxxx Property shall be completed within 30 Business Days of this determination.

45.5 If the Xxxxxx Property Option is exercised and the transfer of the Xxxxxx Property completed pursuant to clauses 45.3 and 45.4, M-real agrees that if it should redevelop the Xxxxxx Property or any part of it  for residential purposes within five years from the date of acquiring it, Sappi shall be entitled to receive an equal share of any redevelopment profits less, for the avoidance of doubt, the sum paid by M-real to acquire the Xxxxxx Property (plus interest at the Agreed Rate thereon), payable within one month of the redeveloped site being disposed of by way of sale, lease or licence as a whole or in parts.

45.6 Should M-real exercise the Xxxxxx Property Option for the purpose of redeveloping the Xxxxxx Property for non-industrial use, Sappi shall be entitled to:

(i) receive the book value of the Xxxxxx Property (as at the Completion Date); and

(ii) upon the redevelopment of the Xxxxxx Property or any part of it by M-real for non-industrial use, an equal share in any redevelopment profits less, for the avoidance of doubt, the sum paid by M-real to acquire the Xxxxxx Property (plus interest at the Agreed Rate thereon), payable within one month of the redeveloped site being disposed of by way of sale, lease or licence as a whole or in parts,

and the transfer of the Xxxxxx Property shall be completed within 30 Business Days of the notice served pursuant to clause 45.2. M-real and Sappi agree that they shall in good faith discuss how best to enforce the transfer of the Xxxxxx Property.

45.7 M-real and Sappi shall discuss in good faith what constitutes redevelopment profits for the purposes of clauses 45.5 or 45.6(ii) in the event of any such residential redevelopment and shall if necessary employ the services of an independent expert to help them determine the same.

45.8 Sappi acknowledges that M-real is entering into this Agreement in reliance on the Xxxxxx Property Option in the event a Permanent Cessation occurs. Notwithstanding Schedule 5 of this Agreement, M-real and Sappi acknowledge and agree that in the event Sappi would be in breach of its obligation to transfer the Xxxxxx Property to M-real as set out in this clause 45, Sappi shall indemnify and hold M-real harmless against all damage, loss, liability or expense (including, without limitation, reasonable expenses of investigation and attorneys’ fees) suffered by M-real as a result of the breach of the Xxxxxx Property Option. Any such compensation shall also fully reflect the difference as at the date set out in clause 45.2 between:

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(i) the value of M-real’s share of the anticipated redevelopment profits taking into account any relevant breach and considering such facts and circumstances as may have been relevant to the determination of the value of the Xxxxxx Property Option for M-real; and

(ii) the book value of the Xxxxxx Property.

45.9 Any amounts due under clause 45.8 shall be payable by Sappi to M-real within one month following M-real’s demand and shall be placed in immediately available funds at a bank account nominated by M-real.

46. GUARANTEE

46.1 M-real’s Guarantee

(i) M-real unconditionally and irrevocably guarantees to the Relevant Purchasers (to the extent they are a beneficiary of an obligation of a Relevant Seller) the due and punctual performance and observance by each of the Relevant Sellers of all their obligations, commitments, undertakings, Warranties and indemnities under or pursuant to this Agreement and the Transaction Documents (the “Sellers’ Guaranteed Obligations”) , to the extent of any limit on the liability of M-real and the Relevant Sellers under this Agreement.

(ii) If and whenever any of the Relevant Sellers defaults for any reason whatsoever in the performance of any of the Sellers’ Guaranteed Obligations, M-real shall forthwith upon demand unconditionally perform (or procure performance of) and satisfy (or procure the satisfaction of) the Sellers’ Guaranteed Obligations in regard to which such default has been made in the manner prescribed by this Agreement and under any Transaction Document and so that the same benefits shall be conferred on the Relevant Purchasers as they would have received if the Sellers’ Guaranteed Obligations had been duly performed and satisfied by the Relevant Sellers.

(iii) This guarantee is to be a continuing guarantee and accordingly is to remain in force until all Sellers’ Guaranteed Obligations shall have been performed or satisfied. This guarantee is in addition to and without prejudice to and not in substitution for any rights or security which the Relevant Purchasers may now or hereafter have or hold for the performance and observance of the Sellers’ Guaranteed Obligations.

(iv) As a separate and independent obligation, M-real agrees that any of the Sellers’ Guaranteed Obligations (including, without limitation, any moneys payable) which may not be enforceable against or recoverable from any of the Relevant Sellers by reason of any legal limitation, disability or incapacity on or of any of the Relevant Sellers or any other fact or circumstances (other than any limitation imposed by this Agreement or under any Transaction Document) shall nevertheless be enforceable against and recoverable from M-real as though the same had been incurred by M-real and M-real was the sole or principal obligor in respect thereof and shall be performed or paid by M-real on demand.

(v) The liability of M-real under this clause 46.1:

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(a) shall not be released or diminished by any variation of the Sellers’ Guaranteed Obligations or any forbearance, neglect or delay in seeking performance of the Sellers’ Guaranteed Obligations or any granting of time for such performance; and

(b) shall not be affected or impaired by reason of any other fact or event which in the absence of this provision would or might constitute or afford a legal or equitable discharge or release or a defence to a guarantor.

46.2 The Sappi’s Guarantee

(i) Sappi unconditionally and irrevocably guarantees to the Relevant Sellers the due and punctual performance and observance by each of the Relevant Purchasers of all their obligations, commitments, undertakings, warranties and indemnities under or pursuant to this Agreement and any Transaction Document (the “Purchasers’ Guaranteed Obligations”) to the extent of any limit on the liability of Sappi and the Relevant Purchasers under this Agreement or any Transaction Document.

(ii) If and whenever any of the Relevant Purchasers defaults for any reason whatsoever in the performance of any of the Purchasers’ Guaranteed Obligations, the Sappi shall forthwith upon demand unconditionally perform (or procure performance of) and satisfy (or procure the satisfaction of) the Purchasers’ Guaranteed Obligations in regard to which such default has been made in the manner prescribed by this Agreement or any Transaction Document and so that the same benefits shall be conferred on the Relevant Sellers as they would have received if the Purchasers’ Guaranteed Obligations had been duly performed and satisfied by the Relevant Purchaser.

(iii) This guarantee is to be a continuing guarantee and accordingly is to remain in force until all the Purchasers’ Guaranteed Obligations shall have been performed or satisfied. This guarantee is in addition to and without prejudice to and not in substitution for any rights or security which the Relevant Sellers may now or hereafter have or hold for the performance and observance of the Purchasers’ Guaranteed Obligations.

(iv) As a separate and independent obligation the Sappi agrees that any of the Purchasers’ Guaranteed Obligations (including, without limitation, any moneys payable) which may not be enforceable against or recoverable from any of the Relevant Purchasers by reason of any legal limitation, disability or incapacity on or of any of the Relevant Purchasers or any other fact or circumstances (other than any limitation imposed by this Agreement or any Transaction Document) shall nevertheless be enforceable against and recoverable from Sappi as though the same had been incurred by Sappi and Sappi were the sole or principal obligor in respect thereof and shall be performed or paid by Sappi on demand.

(v) The liability of Sappi under this clause 46.2:

(a) shall not be released or diminished by any variation of the Purchasers’ Guaranteed Obligations or any forbearance, neglect or delay in seeking performance of the Purchasers’ Guaranteed Obligations or any granting of time for such performance; and

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(b) shall not be affected or impaired by reason of any other fact or event which in the absence of this provision would or might constitute or afford a legal or equitable discharge or release or a defence to a guarantor.

47. INDEMNITIES ON AN AFTER-TAX BASIS

47.1 All references in this agreement to “indemnify” and “indemnifying” shall be construed as references to “indemnify” and “indemnifying” on an after-Tax basis.

47.2 For the purposes of clause 47.1, “after-Tax basis” means that to the extent that the amount payable pursuant to such indemnity (the “Payment”) is subject to a deduction or withholding required by law in respect of Tax or is chargeable to any Tax in the hands of the recipient it shall be increased so as to ensure that, after taking into account:

(i) the Tax chargeable on such amount (including on the increased amount); and

(ii) any Tax credit, repayment or other Tax benefit which is available to the indemnified party or the recipient of the Payment solely as a result of the matter giving rise to the Payment Obligation or as a result of receiving the Payment (which amount of Tax and Tax credit, repayment or other Tax benefit is to be determined by the auditors of the recipient at the shared expense of both parties and is to be certified as such to the party making the Payment),

the recipient of the Payment is in the same position as it would have been in if the matter giving rise to the obligation to make the Payment had not occurred.

47.3 If any party to this Agreement assigns the benefit in whole or in part of this Agreement, the liability of any other party to make an increased payment in accordance with clause 47.2 shall be limited to that (if any) which it would have been liable to make if no such assignment had taken place.

48. LANGUAGE

48.1 Each notice, demand, request, statement, instrument, certificate, or other communication under or in connection with this Agreement shall be:

(i) in English; or

(ii) if not in English, accompanied by an English translation made by a translator, and certified by an officer of the party giving the notice to be accurate.

48.2 The receiving party shall be entitled to assume the accuracy of and rely upon any English translation of any document provided pursuant to clause 48.1(ii).

49. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with English law.

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50. JURISDICTION

50.1 Each of the parties to this Agreement irrevocably agrees that the courts of England are to have exclusive jurisdiction to settle any disputes which may arise out of or in connection with this Agreement and that accordingly any Proceedings may only be brought in such courts.

50.2 Each party irrevocably waives (and irrevocably agrees not to raise) any objection which it may have now or hereafter to the laying of the venue of any proceedings in any such court as is referred to in clause 50.1 and any claim of forum non conveniens and further irrevocably agrees that a judgment in any Proceedings brought in any court referred to in this clause shall (provided that there is no appeal pending or open) be conclusive and binding upon such party.

51. AGENTS FOR SERVICE

51.1 The Relevant Purchasers irrevocably agree that any notice or document may be sufficiently and effectively served on them in connection with Proceedings in England and Wales by service on Sappi (UK) Limited, Xxxxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxxxxx, Xxxxxxxxxx XX0 0XX, if no replacement agent has been appointed and notified to the Relevant Sellers pursuant to clause 51.2 below, or on the replacement agent if one has been so appointed and notified to the Relevant Sellers. Any notice or document served pursuant to this clause 51.1 shall be marked for the attention of:

(i) Xx Xxxxx Xxxxxxx or such other address within England or Wales as may be notified to the Relevant Sellers by the Relevant Purchasers; or

(ii) such other person as is appointed as agent for service pursuant to clause 51.2 below at the address notified pursuant to clause 51.2 below.

51.2 If the agent referred to in clause 51.1 above (or any replacement agent appointed pursuant to this clause) at any time ceases for any reason to act as such, the Relevant Purchasers shall appoint a replacement agent to accept service having an address for service in England or Wales and shall notify the Relevant Sellers of the name and address of the replacement agent; failing such appointment and notification, the Relevant Sellers shall be entitled by notice to the Relevant Purchaser to appoint such a replacement agent to act on the Relevant Purchasers behalf PROVIDED THAT in cases where service is effected upon a replacement agent appointed by the Relevant Sellers in accordance with this clause 51.2 a copy of the relevant notice or document shall at the same time be forwarded to the last known business address of the Relevant Purchasers.

51.3 Each of the Relevant Sellers irrevocably agree that any notice or document may be sufficiently and effectively served on them in connection with Proceedings in England and Wales by service on the Company Secretary of M-real UK Services Limited, Xxxxxxxxxxxxx, Xxxx, XX00 0XX, if no replacement agent has been appointed and notified to the Purchase pursuant to clause 51.4 below, or on the replacement agent if one has been so appointed and notified to the Purchaser. Any notice or document served pursuant to this clause 51.3 shall be marked for the attention of:

(i) Xx Xxxxx Xxxxxxx or such other address within England or Wales as may be notified to the Relevant Purchasers by the Relevant Sellers; or

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(ii) such other person as is appointed as agent for service pursuant to clause 51.4 below at the address notified pursuant to clause 51.4 below.

51.4 If the agent referred to in clause 51.3 above (or any replacement agent appointed pursuant to this clause) at any time ceases for any reason to act as such, the Relevant Sellers shall appoint a replacement agent to accept service having an address for service in England or Wales and shall notify the Relevant Purchasers of the name and address of the replacement agent; failing such appointment and notification, the Relevant Purchasers shall be entitled by notice to the Relevant Sellers to appoint such a replacement agent to act on the Relevant Sellers behalf PROVIDED THAT in cases where service is effected upon a replacement agent appointed by the Relevant Purchasers in accordance with this clause 51.4 a copy of the relevant notice or document shall at the same time be forwarded to the last known business address of the Relevant Sellers.

51.5 The agent for the receipt of service of process of a party referred to in this clause 51 as that party’s “Process Agent”.

51.6 Any Service Document shall be deemed to have been duly served on a party if marked for the attention of that party’s Process Agent at the addresses specified in clauses 51.1 and 51.3 or in accordance with clauses 51.2 and 51.4 and:

(i) left at the specified or last known business address (as the case may be); or

(ii) sent to the specified or last known business address (as the case may be) by first class post or air mail.

In the case of (i), the Service Document shall be deemed to have been duly served when it is left. In the case of (ii), the Service Document shall be deemed to have been served two clear Business Days after the date of posting.

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SCHEDULE 1

(INTERPRETATION)

1. In this Agreement and the Schedules to it:

“Äänekoski Board Machine”		Means the paper machine referred to as the Äänekoski board machine located at M-real’s Äänekoski Mill in Finland;
“Äänekoski Mill”		means the paper mill operated by M-real at 00000 Xxxxxxxxx, Xxxxxxx;
“Äänekoski Mill’s PM2”		means the paper machine referred to as “PM2” located at M-real’s Äänekoski Mill in Finland;
“Äänekoski PM2 Goods”		Means the coated graphics paper products produced on Äänekoski Mill’s PM2 as at the date of Completion;
“Äänekoski PM2 Exclusive Marketing Agreement”		means the agreement in the Agreed Form listed as Attachment 16 to this Agreement to be entered into between M-real and Sappi Europe SA on Completion;
“Äänekoski Transitional Agreement”		means the transitional agreement between Sappi Europe S.A. and M-Real Corporation relating to the Äänekoski Mill;
“Accounting Principles and Policies”		means the accounting practices of M-real as consistently applied and M-real’s IFRS based accounting policies, principles, bases and methodologies;
“Account”		has the meaning given to it in clause 11.2(iii);
“Accounts”		means in respect of each member of the Group, the audited statutory accounts of that member of the Group for the accounting period ended on the Statutory Accounts Date and drawn up in accordance with generally accepted accounting principles applicable to that member of the Group;
“Accounts Date”		means 30 June, 2008;
“Adjustment Payment”		has the meaning given to it Schedule 6;
“Agreed Form”		in relation to any document means such document in the form initialled for the purposes of identification only by and on behalf of the Relevant Purchasers and the Relevant Sellers;
“Agreed Rate”		means 1.5 per cent. above the base rate from time to time of the European Central Bank;
“Assumed Liabilities”		has the meaning given to it in clause 15.2;
“Assurance”		means any warranty, representation, statement, assurance, covenant, agreement, undertaking, indemnity, guarantee or commitment of any nature whatsoever;
“Biberist”		means M-real Biberist, a company incorporated in Switzerland with registered number CH-251.3.000.460-7 and whose registered office is at Xxxxxxxxxxxxx 0, XX 0000, Xxxxxxxx,

00

		Xxxxxxxxxxx;
“Biberist Mill”		means the paper mill operated by Biberist at Xxxxxxxxxxxxx 0, XX-0000 Xxxxxxxx, Xxxxxxxxxxx;
“Biberist Retained Earnings”		has the meaning given to it in clause 19.8;
“Biberist Shares”		means the shares of CHF 1,000 each representing the entire issued share capital of Biberist details of which are set out in Schedule 8;
“Books and Records”		means all books and records containing Business Information to the extent relating to the Mill Business, the Coaters and the Know-How Business or on which any Business Information relating to the Mill Business, the Coaters and the Know-How Business is recorded, including, without limitation, all documents and other material (including all forms of computer or machine readable material);
“Business”		means the business comprising the Business Assets;
“Business Assets”		means those assets set out in clause 2.1(i) – (x) of this Agreement;
“Business Contracts”		means:
			(i) all the contracts, arrangements, undertakings, agreements and engagements entered into on or prior to Completion by or on behalf of any of the Relevant Sellers relating exclusively or predominantly to the Mill Business (including the Energy Plant Contracts to the extent they are transferred pursuant to clause 14.9 of this Agreement) or relating in part to the Mill Business, (but then only to the extent that the same do so relate) to which M-real or another member of the Sellers’ Group is (itself or through an agent) a party or the benefit of which is held in trust for or has been assigned to M-real or the relevant member of the Sellers’ Group as at Completion; and
			(ii) the order books relating exclusively to the Coaters and the Know-How Business,
		but excluding:
			(a) any employment contract of any Business Employee; and
			(b) any contract the benefit of which is to be used by any member of the Sellers’ Group

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		to provide services under the Transaction Documents;
“Business Days”		means a day (other than a Saturday or a Sunday) on which banks are open for business in Frankfurt am Main, Helsinki, Johannesburg, London and Zurich (other than solely trading or settlement in Euros);
“Business Employees”		means the employees that are predominantly engaged in the Mill Business as set out in Attachment 8 to this Agreement, subject to changes in the ordinary course among such individual employees listed but at all times subject to the provisions of this Agreement;
“Business Goodwill”		means all the goodwill:
			(i) in relation to the Mill Business and the Know-How Business; and
			(ii) in relation to the Coaters,
		and in each case to the extent it relates to the Business Assets other than the Business Goodwill;
“Business Information”		means all written information and know -how relating exclusively to the Mill Business, the Coaters and the Know-How Business (including but not limited to all test results, reports, particulars of suppliers, recipes, market forecasts and particulars of customers to the extent relating to the Mill Business, Coaters and Know-How Business which is proprietary to M-real or another member of the Sellers’ Group;
“Business Intellectual Property”		means:
			(i) the trade xxxx registrations and applications for trade xxxx registration listed in Part A of Schedule 11 and including, for the avoidance of doubt, the GALERIE Marks;
			(ii) the patents and patent applications listed in Part B of Schedule 11;
			(iii) the registered design listed in Part D of Schedule 11;
		and
		save for the Sellers’ Marks, all other Intellectual Property owned by members of the Sellers’ Group which at or immediately before Completion is/are used exclusively or predominantly in the Mill Business; the Coaters and/or the Know-How Business;
“Business Intellectual Property		means the assignments of the registered Business Intellectual Property in the Agreed Form listed as Attachment 9 to this

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Assignments”		Agreement to be entered into at Completion pursuant to paragraph 1A (iv) of Schedule 3, as referred to in clause 2.5;
“Business Merchant Rebates”		means sums owed in respect of the Mill Business by the Relevant Sellers’ to their customers as a result of specified annual purchase targets having been met for the relevant year ended 31 December;
“Business Plant and Machinery”		means:
			(i) in relation to the Mill Business all the plant and machinery and equipment, loose tools, fittings, furniture, partitioning used or to be used exclusively or predominantly in relation to the Mill Business at Completion;
			(ii) the Mill Business Vehicles; and
			(iii) the Coaters, fittings and spare parts used or to be used exclusively in relation to the Coaters at Completion;
“Business Properties”		means the Xxxxxx Property and the Kirkniemi Property, details of which are set out in Part A of Schedule 9;
“Business Properties Transfer Deed”		means the agreement in the Agreed Form listed as Attachment 18 to this Agreement to be entered into between M-real and Sappi Finland I Oy;
“Business Purchaser”		means, in relation to each of the Business Assets referred to in column (2) of Part 2 of Schedule 13 the company whose name or corporate form is set out opposite that Business Asset in column (3);
“Business Receivables”		means all debts or outstanding payments due from any third party receivable or owed to any of the Business Sellers (excluding outstanding payments due from any members of the Seller’s Group) relating exclusively to the Mill Business or relating to part of the Mill Business (but then only to the extent the same do relate) as at or at any time prior to Completion whether or not yet due or payable (including, without limitation, trade debts, accrued income, prepayments, retrospective rebates and overpayments) but excluding (in each case) any amounts in respect of Finnish VAT falling within clause 2.1(d) (“Excluded Assets”) and also excluding (in each case) any amount due pursuant to Supplier Rebates to the extent they relate to the Mill Business and “Business Receivable” shall be construed accordingly;
“Business Seller”		means, in relation to each of the Business Assets referred to in column (2) of Part 2 of Schedule 13, the company whose name is set out opposite that Business Asset in column (1);
“Business Stocks”		means all stocks of raw materials, work-in-progress, finished goods, and other stock-in-trade, packaging, spares and other

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		goods to the extent related to the Mill Business at Completion;
“Carve-Out Accounts”		means the consolidated reviewed accounts of the Group Companies and the Mill Business in the Agreed Form for the three and a half year period ended on the Accounts Date;
“Chemische Werke Xxxx-Wildshausen GmbH”		means Chemische Werke Xxxx-Wildshausen GmbH, a company incorporated in Germany at the local court of Aschaffenburg, with registered number 10207 and whose registered office is at Xxxxxxxxxxx Xxxxxxx 0-0, X-00000 Xxxxxxxxxx, Germany;
“CHP Lease”		means the lease agreement in respect of the CHP Plant entered into between M-real and Fortum pursuant to the Energy Plant Contracts which expires on 31 October, 2012;
“CHP Outstanding Lease Payments”		means the monthly instalments pursuant to the CHP Lease payable by M-real (excluding any interest but including the CHP Plant redemption value of €5,015,057) which are outstanding up and until 31 October, 2012 and as accounted for in the Carve-Out Accounts and set out in Attachment 33;
“CHP Plant”		means the natural gas fuelled power plant situated at the Kirkniemi Mill, consisting of the following main components: steam boiler, gas turbine, flue gas heat recovery boiler, steam turbine with associated auxiliaries and buildings housing main components;
“CN Papiervertriebs GmbH”		means CN Papiervertriebs GmbH, a company incorporated in Germany with registered number HRB 11184, Amtsgericht Bonn and whose registered office is at Xxxxxxxxxxxx Xxx. 00, 00000 Xxxxxxxxxxx, Xxxxxxx;
“CN Shares”		means the entire issued share capital of CN Papiervertriebs GmbH, details of which are set out in Schedule 8;
“Claims”		save as the term is used in Schedule 14 means all rights and claims of any of the Business Sellers arising at any time whether before or after Completion in relation to any of the Business Assets or any Assumed Liability (but excluding any rights or claims under insurance policies) and “Claim” means any one of them;
“Coated Graphic Paper Business”		means a business that engages in the production or sale of coated wood-free paper or coated wood-containing paper other than coated speciality paper, paperboard and paper that is cast coated or coated only on one side;
“Coater Number 2”		means the coater number two owned by Zanders at its Gohrsmühle Mill in Germany;
“Coater Number 3”		means the coater number three owned by Zanders at its Gohrsmühle Mill in Germany;
“Coaters”		means the Gohrsmühle Coaters and the Hallein Coater;
“Commercial Arrangements Term		means the term sheet dated the same day as this Agreement detailing certain commercial terms agreed between M-real and

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Sheet”		Sappi listed as Attachment 26 to this Agreement;
“Companies”		means the German Companies and the Swiss Company;
“Companies Xxx 0000”		the Companies Xxx 0000, as amended or re-enacted;
“Company CO2 Obligation”		has the meaning given to it in Schedule 6;
“Company Employees”		means the employees of each of the Group Companies at Completion;
“Company Merchant Rebates”		means sums owed by the Companies or any one of them to their customers as a result of specified annual purchase targets having been met for the relevant year ended 31 December;
“Company Properties”		means the Immovable Properties specified in Part B of Schedule 9;
“Competition Authority”		means any supra-national, national, state, municipal or local government (including any subdivision, court, administrative agency or commission or other authority thereof) or any governmental, quasi-governmental, statutory, regulatory or investigative body or court, or private body exercising any regulatory authority or other governmental or quasi- governmental authority, including the European Union and the European Commission and any other entity in any jurisdiction responsible or having powers for the enforcement of competition laws and for investigating, approving or objecting to, mergers;
“Completion”		means the completion of the sale and purchase of the Business Assets and the Shares under this Agreement;
“Completion Date”		means the first day that:
			(i) falls on the end of a month; and
			(ii) follows the fifth Business Day after M-real and Sappi have informed each other of the fulfilment of all conditions to Completion pursuant to Schedule 2; and
			(iii) coincides with or follows the end of the business year of Stockstadt GmbH that has been shortened in accordance with clause 4.6 of this Agreement, as the case may be;
“Completion Statements”		means the completion statements to be drawn up in accordance with Schedule 6;
“Completion Time”		has the meaning given to it in Schedule 6;
“Completion Time Net Working Capital”		has the meaning given to it in Schedule 6;

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“Confidentially Agreement”		means the confidentiality agreement entered into between M-real and Sappi dated 15 May, 2008 as amended from time to time;
“Consideration”		means the Initial Consideration and the Estimated Inter-Group Debt paid by the Relevant Purchasers to the Relevant Sellers in accordance with clause 7 and as adjusted, if applicable, in accordance with clause 8;
“Consideration Shares”		means 6,982,105 Sappi Shares to be issued as fully paid to M-real (or to M-real’s nominee(s)) pursuant to this Agreement at the Consideration Share Price;
“Consideration Share Price”		means €7.161 per Sappi Share as adjusted pursuant to Schedule 16;
“Current Market Price”		means, for the purposes of Schedule 16, in respect of a Sappi Share at a particular date, the volume weighted average share price of Sappi Shares as published by, or derived from the relevant quotations published by, the Johannesburg Stock Exchange for the five consecutive dealing days ending on the dealing day immediately preceding such date; provided that if at any time during the said five day period the Sappi Shares shall have been quoted ex dividend and during some other part of that period the Sappi Shares shall have been quoted cum then:
			(i) if the Sappi Shares to be issued do not rank for the dividend in question, the prices on the dates on which the Sappi Shares shall have been quoted cum-dividend shall for the purpose of this definition be deemed to be the amount thereof reduced by an amount equal to the amount of that dividend per Sappi Share; and
			(ii) if the Sappi Shares to be issued do rank for the dividend in question, the prices on the dates on which the Sappi Shares shall have been quoted ex-dividend shall for the purpose of this definition be deemed to be the amount thereof increased by such similar amount;
“Data Room”		means data room containing those documents listed in the Data Room List;
“Data Room List”		means the index of the documents that were in the Data Room forming Attachment 6 of this Agreement;
“Deutsche Holding”		means M-real Deutsche Holding GmbH, a company incorporated in Germany and registered in Germany at the local court with number 1960 and whose registered office is at An der Gohrsmühle 51465 Bergisch Gladbach, Germany;

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“Disclosure Letter”		means the letter dated with the same date as this Agreement written by M-real to the Relevant Purchasers for the purposes of paragraph 10 of Schedule 5;
“Diverse Energy Issues Term Sheet”		means the term sheet listed as Attachment 27 to this Agreement dated the same day as this Agreement;
“Employees”		means the individuals who are: (i)         Company Employees; or (ii)         Business Employees, in each case as at Completion, save that in the Warranties, “Employees” shall mean only those individuals who are so employed at the date of this Agreement;
“Employment Taxes”		has the meaning given to it in Schedule 14 (Tax Indemnity);
“Encumbrance”		means any claim, charge, mortgage, lien, option, equity, power of sale, hypothecation, usufruct, retention of title, right of pre-emption, right of first refusal or other third party rights or security interest of any kind or an agreement, arrangement or obligation to create any of the foregoing;
“Energy Plant Contracts”		means all contracts and arrangements between M-real and Fortum in relation to Kirkniemi Mill’s energy supply and ownership of energy production assets;
“Enterprise Value”		has the meaning given to it in Schedule 6;
“Environment”		has the meaning given to it in paragraph 17 of Schedule 4;
“Environment Authority”		has the meaning given to it in paragraph 17 of Schedule 4;
“Environmental Claim”		has the meaning given to it in paragraph 1 of Schedule 15;
“Environmental Indemnity”		means the indemnity at paragraph 2 of Schedule 15;
“Environmental Laws”		has the meaning given to it in paragraph 17 of Schedule 4;
“Environmental Matters”		has the meaning given to it in paragraph 17 of Schedule 4;
“Environmental Permits”		has the meaning given to it in paragraph 17 of Schedule 4;
“Environmental Warranties”		means warranties set out at paragraph 17 of Schedule 4;
“Estimated Business Net Debt”		has the meaning given to it in Schedule 6;
“Estimated Inter-Group Debt”		has the meaning given to it in Schedule 6;
“Estimated Inter-Group Receivables”		has the meaning given to it in Schedule 6;
“Estimated Net Debt”		has the meaning given to it in Schedule 6;
“Exchange Rate”		means, with respect to any amount in any particular local currency required to be converted into Euros at such rate as

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		set out in paragraph 2(xiii) of Schedule 1, the spot rate of exchange (the closing mid point) for that currency into Euros on such date as quoted by the European Central Bank daily on its website (xxx.xxx.xxx) after 2.15 pm European Central Bank time or at the closest previous Business Day;
“Excluded Assets”		means those assets set out in clause 2.1(a) – (g) of this Agreement;
“Excluded SA Assets”		means those assets described in clause 2.1(b) of this Agreement;
“Final Consideration”		has the meaning given to it in Schedule 6;
“Financing”		means any offering of debt or equity securities by Sappi or any of its affiliates (including the Rights Issue), the proceeds of which are used, in whole or in part, to pay amounts outstanding or payable under this Agreement or under any loan or other agreement entered into pursuant to or in connection with this Agreement;
“Finnish Stock Exchange”		means the OMX Nordic Exchange Helsinki Ltd;
“Finnish VAT Act”		has the meaning given to it in clause 11.2(i);
“Fortum”		means Fortum Oy, a company incorporated in Finland whose registered office is at XX 0, 0000 Xxxxxx, Xxxxxxx (registered in Finland with No. 1463611-4), and references in this Agreement to Fortum shall include, where necessary, its subsidiaries and holding companies from time to time, as appropriate;
“GALERIE Marks”		means, subject to Completion, the Intellectual Property identified in Part C of Schedule 11 and any registrations of the “GALERIE Art” trade xxxx that the Relevant Purchasers acquire in accordance with their undertaking in the Trade Xxxx Licences;
“German Companies”		means CN Papiervertriebs GmbH and Stockstadt GmbH;
“German Pension Liabilities”		has the meaning given to it in Schedule 6;
“German Shares”		means the CN Shares, and the Stockstadt Shares;
“German Share Transfer Agreement”		means the agreement in the Agreed Form listed as Attachment 22 to this Agreement to be entered into between Deutsche Holding and Sappi Deutschland Holding GmbH on Completion;
“German Subsidiary”		means Chemische Werke Xxxx-Wildshausen GmbH;
“Gohrsmühle Coaters”		means Coater Number 2 and Coater Number 3;
“Gohrsmühle Mill”		means the paper mill operated by Zanders at Postfach 200960, An der Gohrsmühle, D-51439 Bergisch Gladbach, Germany;

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“Graphic Paper Business”		means the Business and the business of the Group, taken as a whole;
“Group” or “Group Companies”		means the Companies and the German Subsidiary and “Group Company” means any of them as the context so requires;
“Hallein AG”		means M-real Hallein A.G., a company incorporated in Austria with registered number FN 18407m and whose registered office is at Xxxxxxxxxxxxxxxxx 00, X-0000 Xxxxxxx, Xxxxxxx;
“Hallein Coater”		means the coater owned by Hallein AG at its Hallein Mill in Austria;
“Hallein Coater Asset Sale and Transfer Agreement”		means the agreement in substantially the form listed as Attachment 23 to this Agreement to be entered into between Hallein AG and Sappi Netherlands BV on Completion;
“Hallein Mill”		means the paper mill operated by Hallein AG at Xxxxxxxxxxxxx. 00, X-0000 Xxxxxxx, Xxxxxxx;
“Husum Mill”		means the paper mill operated by M-real Sverige AB at XX-00000 Xxxxx, Xxxxxx;
“Husum Mill’s PM8”		means the paper machine referred to as “PM8” located at M-real’s Husum Mill in Sweden;
“Husum PM8 Coater”		means the off-line coater and the off-line multi nip calendar but excluding the winder serving the Husum Mill’s PM8;
“Husum Mill PM8 Exclusive Marketing Agreement”		means the agreement in the Agreed Form listed as Attachment 15 to this Agreement to be entered into between M-real Sverige AB and Sappi Europe SA on Completion;
“IFRS”		international accounting standards within the meaning of Regulation (EC) No 1606/2002 of 19 July, 2002 on the application of international accounting standards to the extent applicable to the relevant financial statements;
“Immovable Property”		means freehold and leasehold land and buildings or other immovable property in any part of the world;
“Inducement Fee”		has the meaning given to it in clause 40;
“Initial Consideration”		has the meaning given to it in Schedule 6;
“Intellectual Property”		means patents, inventions, trade marks, service marks, trade names, brands, get-up, logos, rights in designs, copyrights, and database rights (whether or not any of these is registered and including applications for registration of any such thing) and all rights or forms of protection of a similar nature or having equivalent or similar effect to any of these which may subsist anywhere in the world;
“Inter-Group Debt”		has the meaning given to it in Schedule 6;
“Inter-Group Debt Adjustment Payment”		has the meaning given to it in Schedule 6;

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“Inter-Group Net Debt”		has the meaning given to it in Schedule 6;
“Inter-Group Receivables”		has the meaning given to it in Schedule 6;
“Inter-Group Receivables Adjustment Payment”		has the meaning given to it in Schedule 6;
“IT Systems”		means software, hardware, data networks and voice networks but excluding networks or telecommunications systems generally available to the public;
“Johannesburg Stock Exchange” or “JSE”		means the JSE Limited, a company incorporated in South Africa and licensed as an exchange under the Securities Services Act, 2004 (as amended);
“Xxxxxx Asset Transfer Agreement”		means the agreement in the Agreed Form listed as Attachment 20 to this Agreement to entered into between M-real and Sappi Finland I Oy on Completion;
“Xxxxxx Mill”		means the paper mill operated by M-real at Xxxxxxxxxx 0, XX-00000 Xxxxxxxxx, Xxxxxxx;
“Xxxxxx PM2”		means the paper machine referred to as “PM2” located at M-real’s Xxxxxx Mill in Finland;
“Xxxxxx PM2 Property”		means the Immovable Property housing the Xxxxxx PM2;
“Xxxxxx PM2 Property Lease”		means the agreement in the Agreed Form listed as Attachment 19 to this Agreement to be entered into between M-real and Sappi Finland I Oy on Completion;
“Xxxxxx Property”		means the Immovable Property of the Xxxxxx Mill, details of which are set out in Part A of Schedule 9;
“Xxxxxx Property Option”		has the meaning given to it in clause 45.1;
“Kirkniemi Asset Transfer Agreement”		means the agreement in the Agreed Form listed as Attachment 21 to this Agreement to be entered into between M-real and Sappi Finland I Oy on Completion;
“Kirkniemi Discharge Compensation”		has the meaning given to it in clause 19.9(ii);
“Kirkniemi Mill”		means the paper mill operated by M-real at XX-00000, Xxxxx, Xxxxxxx;
“Kirkniemi Property”		means the Immovable Property of the Kirkniemi Mill, details of which are set out in Part A of Schedule 9;
“Kirkniemi Trade Receivables”		means all outstanding payments due from any third party customer receivable in relation to the graphic paper business carried out from the Kirkniemi Mill in Finland and in each case including such part of such amounts as relate to VAT and “Kirkniemi Trade Receivable” shall be construed accordingly;

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“Kirkniemi Trade Receivables Cap”		has the meaning given to it in clause 8.4;
“Know-How Business”		means: (i) Husum Mill’s PM8 in Sweden; and (ii) Äänekoski Mill’s PM2 in Finland;
“Lock-Up Agreement”		means the agreement in the Agreed Form to be entered into by M-real and Sappi on the Completion Date which sets out certain restrictions on the disposal of the Consideration Shares and listed as Attachment 12 to this Agreement;
“London Stock Exchange”		means London Stock Exchange plc;
“Long-term Energy Agreements”		means the agreements in the Agreed Form listed as Attachment 17 to this Agreement to be entered into between M-real and Sappi Europe SA on Completion;
“Long-term Pulp Supply Agreements”		means the agreements in the Agreed Form listed as Attachment 14 to this Agreement to be entered into: (i) between M-real, M-real Sverige AB and Sappi Europe SA; and (ii) between Oy Metsä-Botnia AB and Sappi Europe SA, on Completion;
“Long-term Wood Supply Agreement”		means the agreement in the Agreed Form listed as Attachment 13 to this Agreement to be entered into between Metsäliitto Co-operative and Sappi Europe SA on Completion;
“Losses”		means all losses, liabilities, costs (including without limitation legal costs and experts’ and consultants’ fees), charges, expenses, actions, proceedings, claims and demands;
“M-real Sverige AB”		means M-real Sverige AB, a company incorporated in Sweden with registered number 556585-8866 and whose registered office is at Örnsköldsvik, X-000 00 Xxxxx, Xxxxxx;
“M-real Vendor Loan Note”		means the €250,000,000 loan note to be issued by Sappi Papier Holding GmbH (Austria) to M-real on the Completion Date;
“Material Contract”		means any Business Contract and any contract entered into by any member of the Group: (i) calling for payments by any party thereto in excess of €2,000,000 in any one year; (ii) that is a material agreement relating to Intellectual Property;

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		(iii) which restricts M-real or the relevant member of the Sellers’ Group in any material respect from carrying on its respective part of the Graphic Paper Business anywhere in the world; (iv) which is a joint venture agreement or arrangement under which M-real or the relevant member of the Sellers’ Group is to participate with any other person in any business; (v) which has an unexpired term of two or more years or cannot be terminated on less than two years’ notice; or (vi) that is a material contract and, so far as the Sellers are aware, which can be terminated by any other party in the event of a change of control of the relevant member of the Group, other than (in either case): (a) any contract with any Employee; (b) purchase or sale orders for stock placed in accordance with the normal practice of the Graphic Paper Business (including purchase and sale orders in respect of which the counterparty is a member of the Sellers’ Group); and (c) any leases or tenancy arrangements under which Property is occupied;
“Merchant Rebates”		means the Business Merchant Rebates and the Company Merchant Rebates;
“Merchant Rebate Adjustment”		has the meaning given to it in clause 8.11;
“Merger Regulation”		means Council Regulation (EC) 139/2004;
“Metsäliitto Co-operative”		means Metsäliitto Co-operative, a co-operative society incorporated in Finland with registered number 0116300-4 and whose registered office is at Xxxxxxxxxxxxx 0, XX-00000 Xxxxx, Xxxxxxx;
“Mill Business”		means the graphic paper business of M-real carried out from:

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		(i)         the Xxxxxx Mill in Finland; and (ii)         the Kirkniemi Mill in Finland;
“Mill Business Assets”		has the meaning given to it in clause 11.2(i);
“Mill Business Efficiency Programme”		means the redundancy programme of M-real covering the whole Mill Business at its Kirkniemi Mill concerning a reduction in headcount of 57 (announced on 14 February, 2007) and at its Xxxxxx Mill concerning the closure of the Xxxxxx PM2 and a reduction in headcount of 82 (announced on 13 November, 2007);
“Mill Business Vehicles”		means those vehicles listed in Attachment 32 used exclusively in relation to the Mill Business;
“MIS Payments”		means payments due to certain M-real employees pursuant to M-real’s management incentive scheme;
“Net Working Capital Adjustment”		has the meaning given to it in Schedule 6;
“NL Holding”		means M-real NL Holding B.V., a company incorporated in the Netherlands with registered number 02334705 and whose registered office is at Xxx Xxxxxxxxxxxxxxx 00, XX-0000 XX Amsterdam, X.X. Xxx 00000, X.X.-0000 XX Xxxxxxxxx, xxx Xxxxxxxxxxx;
“Option”		has the meaning given to it in clause 43.1;
“Other Stockstadt”		has the meaning given to it in Schedule 6;
“Oy Metsä-Botnia AB”		means Oy Metsä-Botnia AB, a company incorporated in Finland with registered number 0791416-3 and whose registered office is Xxxxxxxxxxxxx 0, XX-00000 Xxxxx, Xxxxxxx;
“Permanent Cessation”		has the meaning given to it in clause 45.1;
“Permitted Assignee”		has the meaning given to it in clause 32.2;
“Permitted Encumbrances”		means security interests arising in the ordinary course of business or by operation of law, security interests arising under sales contracts with title retention provisions, equipment leases with third parties entered into in the ordinary course of business, security interests for Taxes and other governmental charges which are not due and payable or which may thereafter be paid without penalty and mortgages, charges, pledges, liens or other forms of security or encumbrance or equity which secure debt and other imperfections in title and encumbrances, if any, which do not in any case individually or in aggregate materially impair the continued use and operation of the assets to which they relate in the context of the Graphic Paper Business;
“Pre-sale Reorganisation”		means: (i) the transfer of Hallein AG by Stockstadt GmbH to another entity in the Sellers’ Group

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		prior to the Completion Date; and (ii) the transfer of the SA Customer Lists by the Companies to another entity in the Sellers’ Group prior to the Completion Date;
“Pre-sale Reorganisation Liabilities”		means any liabilities of Stockstadt GmbH in respect of the transfer of Hallein AG to another entity in the Sellers’ Group prior to the Completion Date;
“Proceedings”		means any proceeding, suit or action arising out of or in connection with this Agreement;
“Proceeds of Rights Issue”		means the aggregate proceeds raised by Sappi in the Rights Issue being €400,000,000 after the deduction of the fees, expenses and costs of the Rights Issue;
“Process Agent”		has the meaning given to it in clause 51.5;
“Profit and Loss Pooling Agreement”		means the agreement on the transfer of profit and loss (Gewinnabführungs- und Verlustübernahmevertrag) of 11 May, 2001 (as amended on 23 December, 2002) between Deutsche Holding and Stockstadt GmbH;
“Properties”		means the Business Properties and the Company Properties;
“Property Owner”		means, in respect of a Property, the entity listed as its owner in Schedule 9;
“Purchase Price”		has the meaning given to it in clause 43.1;
“Purchasers’ Completion Documents”		has the meaning given to it in clause 18.1(i);
“Purchasers’ Guaranteed Obligations”		has the meaning given to it in clause 46.2(i);
“Purchaser’s Group”		means Sappi and its subsidiaries and holding companies from time to time, as appropriate (including, for the avoidance of doubt, following Completion, each member of the Group);
“Rand” or “ZAR”		means the lawful currency for the time being of South Africa;
“Relief”		means any relief, loss, allowance, exemption, set-off, or credit in respect of Tax, or deduction in computing profits for Tax purposes;
“Resigning Board Member”		means the members of any supervisory board or advisory board or similar corporate body of each of the Group Companies who will resign on Completion and as indicated against their respective names in Schedule 7, notification of which will be delivered to the Relevant Purchasers at Completion;
“Resigning Director”		means the directors of each of the Group Companies who will resign on Completion and as indicated against their respective names in Schedule 7, notification of which will be delivered to

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		the Relevant Purchasers at Completion;
“Rights Issue”		means the rights issue contemplated by the Standby Underwriting Agreement;
“SA Customer Lists”		means any customer lists held by the Companies or any one of them to the extent that they relate to customers of the Companies in South Africa;
“SA Option”		has the meaning given to it in clause 44.1;
“SA Put”		has the meaning given to it in clause 44.1;
“Sappi Circular”		has the meaning given to it in clause 4.2;
“Sappi Deutschland Holding GmbH”		means Sappi Deutschland Holding GmbH, a company incorporated in Germany and registered in Germany at the local court with number HRB 110 140, and whose registered office at Xxxxxxxxxxx 0, 00000 Xxxxxx, Xxxxxxx;
“Sappi Europe SA”		means Sappi Europe SA, a company incorporated in Belgium with registered number BE 0449.654.386 and whose registered office is at Xxxxxxxx xx xx Xxxxx, X- 0000 Xxxxxxxx, Xxxxxxx;
“Sappi Finland I Oy”		means Sappi Finland I Oy, a company incorporated in Finland with registered number 2219145-0 and whose registered office is at x/x Xxxxxx Xxxxxxxx, Xxxxxxxxxx 0, 00000, Xxxxxxxx, Xxxxxxx;
“Sappi Netherlands BV”		means Sappi Netherlands BV, a company incorporated in the Netherlands with registered number 14631721 and whose registered office is at Xxxxxxxxx 00, 0000 XX Maastricht, the Netherlands;
“Sappi Papier Holding GmbH (Austria)”		means Sappi Papier Holding GmbH (Austria), a company incorporated in Austria with registered number FN 167931 h, and whose registered office is at Xxxxxxx Xxxxxxx 00, 0000 Xxxxxxxx Xxxxxxx;
“Sappi Shares”		means the ordinary shares of one Rand each in the share capital of Sappi;
“Securities Act”		means the US Securities Act of 1933, as amended;
“Sellers’ Business”		means the business of the Sellers’ Group, but excluding a Coated Graphic Paper Business, as at Completion;
“Sellers’ Completion Documents”		has the meaning given to it in paragraph 1(A) of Schedule 4;
“Sellers’ Guaranteed Obligations”		has the meaning given to it in clause 46.1 (i);
“Sellers’ Group”		means the Sellers and their respective subsidiaries and holding companies (and, for the avoidance of doubt, with effect from the Completion Date excluding the Group);
“Sellers’ Group Insurance Policies”		means insurance policies taken out by members of the Sellers’ Group and “Sellers’ Group Insurance Policy” shall be

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		construed accordingly;
“Sellers’ Marks”		means “M-REAL”, “XXXXX-XXXXX” and all related logos and trade marks owned or used by the Sellers’ Group used in connection with those marks;
“Sellers’ Solicitors”		means Xxxxxxxxx and May of Xxx Xxxxxxx Xxx, Xxxxxx, XX0X 0XX;
“Senior Employees”		has the meaning given to it in paragraph 20(A) of Schedule 4 and “Senior Employee” shall be construed accordingly;
“Service Document”		means a claim form, summons, order, judgement or other document issued in connection with any Proceedings;
“Share Purchaser”		means, in relation to each of the Companies referred to in column (2) of Part A of Schedule 13 the company whose name is set out opposite that Company in column (4);
“Share Sellers”		means Deutsche Holding and NL Holding;
“Shares”		means the CN Shares, the Stockstadt Shares and the Biberist Shares;
“Significant Adverse Change”		means a change, event or circumstance which or up to 3 separate changes, events and circumstances which, in aggregate: (i) cause or would be reasonably likely to cause production volumes of graphic paper in respect of the Biberist Mill, Xxxxxx Mill, Kirkniemi Mill, and Stockstadt Mill to cease or be reduced by 200,000 tonnes (in aggregate) over a period of 12 months from the date of such change, event or circumstance; or (ii) lead or would be reasonably likely to lead to a liability in respect of the Graphic Paper Business as a whole, which would have to be settled in cash, having a net present value in excess of €110,000,000 from the date of such change, event or circumstance;
“South Africa”		means the Republic of South Africa;
“Standby Underwriting Agreement”		means the agreement dated the same day as this Agreement between Sappi and Citigroup Global Markets Limited and X.X. Xxxxxx Securities Ltd listed as Attachment 29 to this Agreement;
“Statutory Accounts Date”		means 31 December, 2007;
“Stockstadt GmbH”		means M-real Stockstadt GmbH, a company incorporated in Germany with registered number HRB 8118 and whose

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		registered office is at Xxxxxxxxxxx Xxxxxxx 0-0, X-00000 Xxxxxxxxxx, Xxxxxxx;
“Stockstadt Lease”		means the lease agreement between Stockstadt GmbH and Molsindra Vermietungsgesellschaft mbH & Co. Objekt Stockstadt KG, dated 28 December, 2001, relating to Stockstadt GmbH’s coater;
“Stockstadt Loans”		means the shareholder loan agreements pursuant to which Deutsche Holding extended (i) a long term loan and (ii) 13 short term loans which shall be valued at the Completion Time for the purposes of Schedule 6;
“Stockstadt Mill”		means the paper mill operated by Stockstadt GmbH at Xxxxxxxxxxx Xxxxxxx 0-0, X-00000 Xxxxxxxxxx, Germany;
“Stockstadt Shares”		means the entire issued share capital of Stockstadt GmbH details of which are set out in Schedule 8;
“Submission”		means any submission, filing, notification, briefing paper, proposal, letter, response to a request for information or other written communication to the European Commission or any Competition Authority (including, for the avoidance of doubt, the Form CO);
“Supplier Rebates”		means sums owed to the Mill Business, the Coaters, Stockstadt GmbH and Biberist by their suppliers as a result of specified annual delivery targets having been met in respect of the period up to the Completion Time;
“Swiss Company”		means Biberist;
“Take or Pay Obligation”		has the meaning given to it Schedule 6;
“Target Net Working Capital”		has the meaning given to it in Schedule 6;
“Tax” or “Taxation”		has the meaning given to it in the Tax Indemnity;
“Tax Authority”		means any taxing, revenue or other authority of any jurisdiction competent to impose or collect any Tax liability;
“Tax Claim”		means a Tax Warranty Claim or a Tax Indemnity Claim;
“Tax Indemnity”		means the indemnity in respect of Tax as set out in Schedule 14;
“Tax Indemnity Claim”		means a claim by the Relevant Purchasers or any of them under the Tax Indemnity;
“Tax Warranties”		means the warranties set out at paragraph 22 of Schedule 4;
“Tax Warranty Claim”		means a claim for breach of any of the Tax Warranties;
“Termination Date”		means: (i) 28 February, 2009 if the announcement of the full terms of the Rights Issues has not

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		been made by midnight on that date; or (ii) if the announcement in paragraph (i) above has been made on or before, 28 February, 2009, 30 April, 2009 if the Rights Issue has not closed and settled by that date;
“Third Party Consents”		means all consents, approvals, authorisations or waivers required from third parties (other than those required by the relevant regulatory or anti-trust authority) for the transfer, assignment or novation of any Business Contract in favour of a Relevant Purchaser (or member of the Purchaser’s Group) and “Third Party Consent” shall be construed accordingly;
“Thosca Xxxx Option Letter”		means the letter from Metsäliitto Co-operative to Sappi set out at Attachment 28 dated the same day as this Agreement;
“Trade Xxxx Licences”		means licences of certain GALERIE Marks to be entered into on Completion pursuant to clause 26.6;
“Transaction Documents”		means this Agreement together with the Agreed Form documents listed as Attachments 1 to 33 to this Agreement;
“Transitional Services Agreement”		means the transitional services agreement between the certain Relevant Sellers and certain Relevant Purchasers to be entered into on Completion;
“Transitional Services Term Sheet”		means the list of terms on which M-real and Sappi intend to base the Transitional Services Agreement, as set out in Attachment 11 and dated the same day as this Agreement;
“UGB”		has the meaning given to it in clause 24.4;
“UK Listing Authority”		means the Financial Services Authority, acting in its capacity as the competent authority for the purposes of Part VI of the Financial Services and Markets Xxx 0000 including;
“United States” or “US”		means the United States of America and its territories and dependencies;
“VAT”		means value added tax as implemented in the European Union pursuant to Council Directive 2006/112/EC on the common system of value added tax and legislation supplemental thereto or any similar tax in any jurisdiction outside the European Union;
“Vendor Loans”		means the Euro denominated loan notes to be issued by the Relevant Purchasers to M-real in accordance with the allocation of Enterprise Value set out in Part 2 of Schedule 6;
“Warranties”		means the warranties set out in Schedule 4 and “Warranty” shall be construed accordingly;
“Working hours”		means 9.00 a.m. to 5.00 p.m. on a Business Day; and
“Xxxxxxx”		means M-real Xxxxxxx GmbH, company incorporated in Germany and registered in Germany at the local court with

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number HRB 51420 and whose registered office is at An der Gohrsmühle 51465 Bergisch Gladbach, Germany.

2. In this Agreement, and the Schedules to it, unless otherwise specified: -

(i) references to clauses, Schedules and Attachments are to clauses of, and Schedules and Attachments to, this Agreement;

(ii) a reference to a paragraph is to a paragraph of the clause or Schedule (as the case may be) in which such reference appears and to a sub-paragraph is to a sub-paragraph of the paragraph in which such reference appears;

(iii) a reference to any statute or statutory provision shall be construed as a reference to the same as it may have been, or may from time to time be, amended, modified or re-enacted except to the extent that any amendment or modification made after the date of this Agreement would increase or alter the liability of any party under this Agreement;

(iv) references to a “company” shall be construed so as to include any company, corporation or other body corporate, wherever and however incorporated or established;

(v) references to a “person” shall be construed so as to include any individual, firm, company, government, state or agency of a state or any joint venture, association or partnership (whether or not having separate legal personality);

(vi) expressions “holding company”, “subsidiary” and “wholly-owned subsidiary” shall have the meaning given in the Companies Xxx 0000;

(vii) references to writing shall include any modes of reproducing words in a legible and non-transitory form but shall exclude electronic mail;

(viii) references to times of the day are to London time;

(ix) headings are for convenience only and do not affect the interpretation of this Agreement;

(x) references to any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official, or any legal concept or thing shall in respect of any jurisdiction other than England be deemed to include what most nearly approximates in that jurisdiction to the English legal term;

(xi) references in any Warranty or in this Schedule 1 to any monetary sum expressed in Euros shall, where such sum is referable in whole or in part to a particular jurisdiction, be deemed to be a reference to an equivalent amount in the local currency of that jurisdiction translated at the prevailing exchange rate applicable to that amount of Euros by reference to middle market rates quoted by National Westminster Bank plc immediately before close of business in London on the date of this Agreement or, if such day is not a Business Day, on the Business Day immediately preceding such day;

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(xii) (a) Without prejudice to (b), (c), (d) and (e) below, references in any clause of this Agreement or Warranty to the Sellers’ awareness or any other similar phrase shall be deemed to be a reference to following persons: Xxxxx Xxxxxx, Esa Xxxxxxxxx and Xxxxx Xxxxx;

(b) References to the Sellers’ awareness or any other similar phrase shall be deemed to be a reference to Xxxxx Xxxxx in the following Warranties only:

· Arrangements with the Sellers’ Group, the Business and the members of the Group; Solvency, Accounts and Carve-Out Accounts, Events Since the Accounts Date, Financial Obligations, Intellectual Property and IT and Insurance set out in paragraphs 3, 5, 9, 10, 11, 18 and 19