Fibrek Inc.

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- section 2.8 of National Instrument 44-101 Short Form Prospectus Distributions -- notice of intention to be qualified to file a short form prospectus -- abridgement of 10-day period to allow for financing -- issuer is a successor issuer under NI 44-101 through conversion from an income fund to a corporation -- relief granted as disclosure regarding the predecessor issuer is effectively the disclosure of the successor issuer -- predecessor issuer was qualified to file a short form prospectus and had several years of reporting issuer history.

Applicable Legislative Provisions

National Instrument 44-101 Short Form Prospectus Distribution, ss. 2.8(1), 8.1.

TRANSLATION

May 21, 2010

Background

The securities regulatory authority or regulator in each of the Jurisdictions (each a "Decision Maker") has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the "Legislation") pursuant to section 8.1 of Regulation 44-101 respecting Short Form Prospectus Distributions ("Regulation 44-101") from the requirement under section 2.8 of Regulation 44-101 for the Filer to file a notice declaring its intention (the "Notice of Intention") to be qualified to file a short form prospectus at least 10 business days prior to the filing of its first preliminary short form prospectus (the "Preliminary Prospectus") after the notice (the "Exemption Sought").

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

(a) the Autorité des marchés financiers is the principal regulator for this application (the "Principal Regulator");

(b) the Filer has provided notice that subsection 4.7 (1) of Regulation 11-102 respecting Passport System ("Regulation 11-102") is intended to be relied upon in all jurisdictions of Canada, except for the provinces of Québec and Ontario; and

(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

Terms defined in Regulation 14-101 respecting Definitions and Regulation 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

The Filer

1. The Filer was incorporated under the laws of Canada on March 24, 2010 for the purpose of becoming the successor issuer to SFK Pulp Fund (the "Fund") as a result of the Conversion (as defined below).

2. The head office of the Filer is located at 1010 de Sérigny, Longueuil, Québec, J4K 5G7.

3. The authorized share capital of the Filer consists of an unlimited number of common shares (the "Common Shares") and an unlimited number of preferred shares, issuable in series.

4. The Filer has not conducted any business or operations, other than to execute the arrangement agreement relating to the Conversion and entering into a share option plan in connection with the arrangement.

5. The Filer is not a reporting issuer in any jurisdiction of Canada and is not in default under securities legislation in such jurisdictions.

The Fund

6. The Fund is an unincorporated, open-ended limited purpose trust governed by the laws of the province of Québec. The Fund was established pursuant to a trust agreement dated May 21, 2002, as amended and restated on July 23, 2002, April 28, 2005 and August 16, 2006.

7. The Fund is qualified to file a short form prospectus pursuant to section 2.2 of Regulation 44-101.

8. The Fund is a reporting issuer in each jurisdiction of Canada and is not in default under securities legislation in such jurisdictions.

The Proposed Conversion

9. The Fund is proposing to undertake a conversion of the Fund into the Filer by way of a statutory plan of arrangement (the "Conversion"). Under the Conversion, the holders of units of the Fund (the "Unitholders") will, if certain conditions are satisfied or waived, exchange their respective units for Common Shares.

10. The Conversion has been approved by the Unitholders at the Annual and Special Meeting of the Fund held on May 19, 2010 (the "Meeting") and a management information circular was prepared and mailed to Unitholders in connection with the Conversion and the Meeting.

11. The Conversion is subject to court approval and other conditions. If implemented, it is expected that the Conversion will be effective on or about May 25, 2010.

12. Upon completion of the Conversion,

(a) 90,472,708 Common Shares will be issued and outstanding and the Common Shares will be listed on the Toronto Stock Exchange;

(b) the sole business of the Filer will be the current business of the Fund (the Conversion does not contemplate the acquisition of any additional operating assets or the disposition of any existing operating assets);

(c) the Filer will be a reporting issuer in all jurisdictions of Canada; and

(d) the Filer will be a "successor issuer" to the Fund as defined in Regulation 44-101.

The Filer's Anticipated Prospectus Filing

13. The Filer intends to file the Preliminary Prospectus in accordance with Regulation 44-101 on or about May 25, 2010 relating to the offering of securities of the Filer.

Exemption Sought

14. Following the Conversion, the Filer will be qualified to file a short form prospectus on the basis that it will satisfy the requirements of subsections 2.2(a), (b), (c) and (e) of Regulation 44-101 and, as successor issuer, can make use of the exemption provided under subsection 2.7(2) of Regulation 44-101.

15. On May 14, 2010, the Filer, in anticipation of the filing of the Preliminary Prospectus, filed the Notice of Intention.

16. Notwithstanding section 2.2 of Regulation 44-101, subsection 2.8(1) of Regulation 44-101 provides that an issuer is not qualified to file a short form prospectus unless it has filed a notice declaring its intention to be qualified to file a short form prospectus at least 10 business days prior to the issuer filing its first preliminary short form prospectus.

17. The Filer will not satisfy the requirement of subsection 2.8(1) of Regulation 44-101 before June 1, 2010, and will not be qualified to file the Preliminary Prospectus before that time, unless the Exemption Sought is granted.

Decision

Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted, provided that, at the time the Filer files the Preliminary Prospectus, the Filer meets the requirements of :

(a) subsections 2.2(a), (b), (c) and (e) of Regulation 44-101, and

(b) the exemption for successor issuers set forth in subsection 2.7(2) of Regulation 44-101.

This decision will terminate on the earlier of (i) June 1, 2010, the date which is 10 business days following the filing of the Notice of Intention, or (ii) the date the Preliminary Prospectus is filed.