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Domtar Corporation Announced Expiration of Early Tender Time for Tender Offer

Thursday, March 08, 2012

Press release from the issuing company

Domtar Corporation (NYSE: UFS) (TSX: UFS) announced the expiry today, at 5:00 p.m., New York City time, of the early tender deadline (the "Early Tender Time") for its previously announced cash tender offer for its outstanding 10.75% Notes due 2017, 9.5% Notes due 2016, 7.125% Notes due 2015 and 5.375% Notes due 2013 (collectively, the "Notes"). The terms and conditions of the tender offer are described in the Offer to Purchase, dated February 22, 2012 (the "Offer to Purchase"), and related letter of transmittal, which have been sent to holders of the Notes.

The aggregate principal amount of each series of Notes that has been validly tendered and not withdrawn as of the Early Tender Time is set forth in the table below.

Pursuant to the terms of the tender offer, Domtar will only purchase Notes such that the maximum aggregate consideration for Notes purchased in the tender offer, excluding accrued and unpaid interest, will not exceed $250,000,000 (the "Maximum Payment Amount").  The Company will purchase Notes that are validly tendered (and not validly withdrawn) in accordance with the acceptance priority levels set forth below and subject to the terms and conditions of the tender offer, including, to the extent additional outstanding Notes are tendered such that the maximum aggregate consideration for Notes purchased in the tender offer, excluding accrued and unpaid interest, would exceed the Maximum Payment Amount, the applicable pro ration.

The tender offer is scheduled to expire at 12:00 midnight, New York City time, on March 20, 2012, unless extended or earlier terminated (such date and time, as the same may be extended, the "Expiration Time"). The Company will accept Notes for purchase promptly after the Expiration Time subject to the terms and conditions of the tender offer as described in the Offer to Purchase and related letter of transmittal.

CUSIP Number Title of Security Acceptance 
Percentage of 
Notes Tendered
257559 AG9 10.75% Notes due 2017 1 $384,750,000 $106,928,000 27.79%
257559 AD6 9.5% Notes due 2016 2 $124,125,000 $31,150,000 25.10%
257559 AC8 7.125% Notes due 2015 3 $212,801,000 $46,538,000 21.87%
257559 AB0 5.375% Notes due 2013 4 $72,160,000 $1,260,000 1.75%

The Company's obligation to consummate the tender offer is conditioned upon the satisfaction or waiver of certain conditions described in the Offer to Purchase, including the Company obtaining approximately $250 million in proceeds from a debt financing, on terms and conditions reasonably satisfactory to the Company, at or before the Expiration Time.

The Company has engaged J.P. Morgan Securities LLC and Deutsche Bank Securities Inc. to act as dealer managers in connection with the tender offer. Questions regarding the tender offer may be directed to J.P. Morgan at (212) 834-4811 (collect) or (866) 834-4666 (U.S. toll-free) or Deutsche Bank Securities at (212) 250-2955 (collect) or (866) 627-0391 (U.S. toll-free). Requests for documentation may be directed to Global Bondholder Services Corporation, the depositary and information agent for the tender offer, at (212) 430-3774 (for banks and brokers) or (866) 470-4200 (U.S. toll-free).

This press release is neither an offer to purchase nor a solicitation of an offer to sell the Notes or any other security. The tender offer is being made only by the Offer to Purchase and the related letter of transmittal. The offer is not being made to noteholders in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. In any jurisdiction in which the offer is required to be made by a licensed broker or dealer, it shall be deemed to be made on behalf of the Company by the dealer managers or one or more registered brokers or dealers licensed under the laws of such jurisdiction.

This press release is not an offering of any securities nor is it a solicitation of an offer to buy any securities.


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