F-4

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Registration No. 333-      

SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549

FORM F-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

SUN MEDIA CORPORATION
AND THE GUARANTORS LISTED ON THE TABLE OF ADDITIONAL REGISTRANTS^*
(Exact name of Registrant as specified in its charter)

PROVINCE OF BRITISH COLUMBIA (State or other jurisdiction of incorporation or organization)	2711 (Primary Standard Industrial Classification Code Number)	98-0336794 (I.R.S. Employer Identification No.)
Sun Media Corporation 333 King Street East Toronto, Ontario M5A 3X5 Canada (416) 947-2202 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)
CT Corporation System 111 Eighth Avenue New York, New York 10011 (212) 894-8600 (Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:
John A. Willett, Esq. Christine D. Rogers, Esq. Arnold & Porter 399 Park Avenue New York, New York 10022-4690 (212) 715-1000	Marc Lacourcière, Esq. Ogilvy Renault 1981 McGill College Avenue, Bureau 1100 Montreal, Québec H3A 3C1 Canada (514) 847-4747

* The companies listed on the next page in the "Table of Additional Registrants" are included in this Registration Statement on Form F-4 as co-registrants.

Approximate date of commencement of proposed sale of the securities to the public:
As soon as practicable following the effectiveness of this registration statement.

        If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

        If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Amount to be Registered	Proposed Maximum Offering Price Per Unit(1)	Proposed Maximum Aggregate Offering Price(1)	Amount of Registration Fee(1)
75/8% Senior Notes due 2013	$205,000,000	100%	$205,000,000	$16,584.50
Guarantees of 75/8% Senior Notes due 2013(2)	—	—	—	—

(1)

The registration fee has been calculated in accordance with Rules 457(a), 457(f)(2) and 457(n) under the Securities Act.

(2)

In accordance with Rule 457(n), no separate fee for the registration of the guarantees of the 7⁵/8% Senior Notes due 2013 of Sun Media Corporation, which are being registered concurrently, is payable.

The co-registrants hereby amend this registration statement on such dates as may be necessary to delay its effective date until the co-registrants shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

TABLE OF ADDITIONAL REGISTRANTS

        The following subsidiaries of Sun Media Corporation have fully and unconditionally guaranteed the 7⁵/8% Senior Notes due 2013 of Sun Media Corporation and are additional registrants under this Registration Statement.

Exact Name of Additional Registrant as Specified in its Charter*	State or Other Jurisdiction of Incorporation or Organization	Primary Standard Industrial Classification Code Number	I.R.S. Employer Identification Number
Bowes Publishers Limited	Province of British Columbia	2711	98-0339996
Sun Media (Toronto) Corporation	Province of British Columbia	2711	98-0341895
SMC Nomineeco Inc.	Province of Ontario	6719	Not applicable
Toronto Sun International, Inc.	Delaware	6719	65-0785241
TS Printing, Inc.	Delaware	2711	52-1583766
Florida Sun Publications, Inc.	Delaware	2711	65-0133064
3661458 Canada Inc.	Canada	6719	Not applicable
3351611 Canada Inc.	Canada	2711	Not applicable

*

The address and telephone number of the principal executive offices of each additional registrant are the same address and telephone number as the principal executive offices of Sun Media Corporation.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

Subject to completion, dated March 24, 2003

PROSPECTUS

Sun Media Corporation

Offer to Exchange All Outstanding

US$205,000,000 Principal Amount of

7⁵/8% Senior Notes due 2013

for US$205,000,000 Principal Amount of
7⁵/8% Senior Notes due 2013
That Have Been Registered Under the Securities Act of 1933

        The Exchange Offer:

•

We will exchange all old notes that are validly tendered and not validly withdrawn for an equal principal amount of new notes that have been registered.



•

You may withdraw tenders of old notes at any time prior to the expiration of the exchange offer.



•

The exchange offer expires at 5:00 p.m., New York City time, on            , 2003, unless we extend the exchange offer.

        The New Notes:

•

The terms of the new notes to be issued in the exchange offer are substantially identical to the old notes, except that the new notes will be freely tradeable by persons who are not affiliated with us.



•

No public market currently exists for the old notes. We do not intend to list the new notes on any securities exchange and, therefore, no active public market is anticipated.



•

The new notes, like the old notes, will be unsecured, will be guaranteed by our restricted subsidiaries that guarantee other indebtedness, and will rank:



•

effectively junior to all of our and our subsidiary guarantors' existing and future secured debt;



•

effectively junior to all debt and other obligations of any of our subsidiaries that do not guarantee the new notes;



•

equally with all of our and our subsidiary guarantors' existing and future unsecured debt that does not expressly provide that it is subordinated to the new notes or the subsidiary guarantees; and



•

senior to all of our and our subsidiary guarantors' existing and future debt that expressly provides that it is subordinated to the new notes or the subsidiary guarantees.

Investing in the new notes involves risks. See "Risk Factors" beginning on page 13.

Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is truthful or complete.
Any representation to the contrary is a criminal offense.

March     , 2003

You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. We are not making an offer of these securities in any state or other jurisdiction where the offer is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus.

TABLE OF CONTENTS

	Page
Summary	1
Risk Factors	13
Use of Proceeds	21
Capitalization	22
Selected Consolidated Financial and Operating Data	23
Management's Discussion and Analysis of Financial Condition and Results of Operations	27
Business	41
Management	55
Our Shareholder	61
Certain Relationships and Related Transactions	61
Description of Certain Indebtedness	63
The Exchange Offer	66
Description of the Notes	77
Tax Considerations	125
Plan of Distribution	128
Legal Matters	129
Independent Auditors	129
Where You Can Find More Information	129
Index to Historical Financial Statements	F-1

This prospectus incorporates by reference documents that contain important business and financial information about Sun Media that is not included in or delivered with this prospectus. These documents are available without charge to security holders upon written or oral request to: Sun Media Corporation, 333 King Street East, Toronto, Ontario, Canada M5A 3X5, Attention: Vice President, Corporate Controller, telephone number (416) 947-2222. To obtain timely delivery, holders of the old notes must request these documents no later than five business days before the expiration date. Unless extended, the expiration date is            , 2003.

        There are holders of the old notes in Ontario, Canada, and the exchange offer is being made on a private placement basis in compliance with the applicable securities law requirements in the Province of Ontario.

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INDUSTRY AND MARKET DATA

        Market data and industry statistics used throughout this prospectus were obtained from internal surveys, market research, publicly available information and industry publications. Industry publications generally state that the information contained in them has been obtained from sources believed to be reliable, but that the accuracy and completeness of this information is not guaranteed. Similarly, internal surveys and industry and market data, while believed to be reliable, have not been independently verified, and we make no representation as to the accuracy of this information.

ENFORCEABILITY OF CIVIL LIABILITIES

        We are a British Columbia company. Substantially all of our directors, controlling persons and officers, as well as some of the experts named in this prospectus, are residents of Canada, and all or a substantial portion of our and their assets are located outside the United States. We have agreed, in accordance with the terms of the indenture under which the new notes will be issued, to accept service of process in any suit, action or proceeding with respect to the indenture or the new notes brought in any federal or state court located in New York City by an agent designated for this purpose, and to submit to the jurisdiction of these courts in connection with these suits, actions or proceedings. However, it may be difficult for holders of the new notes to effect service within the United States upon directors, officers and experts who are not residents of the United States or to realize in the United States upon judgments of courts of the United States predicated upon civil liability under U.S. federal securities laws. We have been advised by Ogilvy Renault, our Canadian counsel, that there is doubt as to the enforceability in Canada against us or against our directors, officers and experts who are not residents of the United States, in original actions or in actions for enforcement of judgments of courts of the United States, of liabilities predicated solely upon U.S. federal securities laws.

FORWARD-LOOKING STATEMENTS

        This prospectus includes "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts included in this prospectus, including statements under the captions "Summary," "Risk Factors," "Use of Proceeds," "Capitalization," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business," as well as statements located elsewhere in this prospectus regarding the prospects of our industry and our prospects, plans, financial position and business strategy, may constitute forward-looking statements. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "expect," "intend," "estimate," "anticipate," "plan," "foresee," "believe" or "continue" or the negatives of these terms, variations of them or similar terminology. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that these expectations will prove to have been correct. This prospectus discloses some important factors that could cause actual results to differ materially from our expectations, including those described under the heading "Risk Factors." These forward-looking statements speak only as of the date of this prospectus. We will not update these statements unless the securities laws require us to do so.

PRESENTATION OF FINANCIAL INFORMATION

        Our consolidated financial statements have been prepared in accordance with the accounting principles generally accepted in Canada, or Canadian GAAP. For a discussion of the principal differences between Canadian GAAP and the accounting principles generally accepted in the United States, or U.S. GAAP, see note 18 to our audited consolidated financial statements. We state our financial statements in Canadian dollars. In this prospectus, references to Canadian dollars, Cdn$ or $

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are to the currency of Canada, and references to U.S. dollars or US$ are to the currency of the United States.

        We are the successor company to 2944707 Canada Inc., a corporation to which Quebecor Inc., or Quebecor, transferred the majority of its newspaper operations, or Quebecor Newspapers, in December 1998. 2944707 Canada Inc. acquired Sun Media Corporation, or Old Sun Media, on January 7, 1999, and subsequently amalgamated with Old Sun Media on February 28, 1999. At the time of the acquisition of Le Groupe Vidéotron ltée, or Vidéotron, by Quebecor in October 2000, we were transferred to Quebecor Media Inc., or Quebecor Media, a subsidiary of Quebecor. For financial reporting purposes, Quebecor Newspapers is our predecessor, and therefore its consolidated results are included in this prospectus for the year ended December 31, 1998. For subsequent years, the consolidated results include the results of Old Sun Media only from January 7, 1999, the date of its acquisition by Quebecor Newspapers.

        We refer to EBITDA a number of times in this prospectus. EBITDA for us means earnings before depreciation, amortization, restructuring charges, financial expenses, dividend income, income taxes, non-controlling interest and discontinued operations. EBITDA is not intended to be a measure that should be regarded as an alternative to other financial operating performance measures or to the statement of cash flows as a measure of liquidity. It is not intended to represent funds available for debt service, dividends, reinvestment or other discretionary uses; it should not be considered in isolation as a substitute for measures of performance prepared in accordance with U.S. or Canadian GAAP. EBITDA is used in this prospectus because we believe that EBITDA is a meaningful measure of performance commonly used in the publishing industry and by the investment community to analyze and compare companies. Our definition of EBITDA may not be identical to similarly titled measures reported by other companies. We provide the calculation of EBITDA used in this prospectus under Canadian GAAP and U.S. GAAP, and the reconciliation of EBITDA used in this prospectus to cash flows under Canadian GAAP and U.S. GAAP, in footnote 7 to the tables under "Selected Consolidated Financial and Operating Data."

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EXCHANGE RATES

        The following table presents the average, high, low and end of period noon buying rates for the periods indicated, in the City of New York for cable transfers in foreign currencies, as certified for customs purposes by the Federal Reserve Bank of New York. Such rates are presented as U.S. dollars per $1.00 and are the inverse of rates quoted by the Federal Reserve Bank of New York for Canadian dollars per US$1.00. On March 20, 2003, the inverse of the noon buying rate was $1.00 equals US$0.6762.

Year Ended	Average(1)	High	Low	Period End
December 31, 2002	0.6370	0.6619	0.6200	0.6329
December 31, 2001	0.6446	0.6697	0.6241	0.6279
December 31, 2000	0.6727	0.6969	0.6410	0.6669
December 31, 1999	0.6746	0.6925	0.6535	0.6925
December 31, 1998	0.6722	0.7105	0.6341	0.6504
December 31, 1997	0.7199	0.7487	0.6945	0.6999

Month Ended	Average(2)	High	Low	Period End
February 28, 2003	0.6613	0.6720	0.6530	0.6720
January 31, 2003	0.6487	0.6570	0.6349	0.6532
December 31, 2002	0.6414	0.6461	0.6329	0.6329
November 30, 2002	0.6364	0.6440	0.6288	0.6387
October 31, 2002	0.6337	0.6407	0.6272	0.6406
September 30, 2002	0.6345	0.6433	0.6304	0.6304

(1)

The average of the exchange rates on the last day of each month during the applicable year.

(2)

The average of the exchange rates for all days during the applicable month.

Canada has no system of exchange controls. There are no Canadian restrictions on the repatriation of capital or earnings of a Canadian company to non-resident investors. There are no laws of Canada or exchange restrictions affecting the payment of dividends, interest, royalties or similar payments to non-resident holders of our securities, except as described under "Tax Considerations—Canadian Federal Income Tax Considerations for Non-Residents of Canada."

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SUMMARY

The following summary highlights selected information from this prospectus to help you understand Sun Media Corporation, the exchange offer and the new notes. For a more complete understanding of Sun Media Corporation, the exchange offer and the new notes, we encourage you to read the entire prospectus carefully. Except for the sections entitled "—The Exchange Offer," "—The New Notes," "The Exchange Offer" and "Description of the Notes" or unless the context indicates or otherwise requires, the terms "Sun Media," "our company," "we," "us," and "our" as used in this prospectus refer to Sun Media Corporation and its consolidated subsidiaries.

Our Business

        We are the largest newspaper publisher in Québec and the second largest newspaper publisher in Canada, with a 21.0% market share in terms of weekly paid circulation, according to statistics published by the Canadian Newspaper Association. We publish 15 paid daily newspapers and serve eight of the top eleven urban markets in Canada. With the exception of the broadsheet The London Free Press, all of our urban paid daily newspapers are tabloids. We also publish 175 weekly newspapers and shopping guides and 18 other specialty publications, including a free daily commuter newspaper. We publish the second and third largest non-national dailies in Canada based on weekly paid circulation: Le Journal de Montréal, with a paid circulation of 1.9 million copies, and The Toronto Sun, with a paid circulation of 1.5 million copies. The combined weekly paid circulation of our daily newspapers is approximately 6.8 million copies.

        In addition, we provide a range of commercial printing and other related services to third parties through our national network of production and printing facilities and distribute newspapers and magazines for other publishers across Canada.

        Newspaper publishing is the oldest and largest segment of the advertising-based media industry in Canada. According to industry sources, in 2001, the total Canadian daily newspaper industry revenue was $3.2 billion, with 79% derived from advertising. Total advertising revenue for the Canadian daily newspaper industry was $2.5 billion in 2001, which represented 23.7% of total Canadian advertising spending. Including revenues from non-daily newspapers, advertising revenues for the newspaper industry as a whole in 2001 were estimated to be approximately $3.3 billion, representing a 31% share of total Canadian advertising spending. Advertising revenues and, to a lesser extent, circulation revenues are generally affected by changes in national and regional economic conditions. From 1995 to 2000, advertising revenues for daily newspapers increased at an average annual rate of 6.3%. Zenith Media estimates that, after declining by 3.1% in 2001, newspaper advertising revenues have remained flat in 2002. Zenith Media forecasts that newspaper advertising revenues in Canada will grow at a compound annual rate of 2.5% between 2002 and 2004.

        For the year ended December 31, 2002, we generated revenues of $853.6 million and EBITDA of $222.3 million. Over this same period, 68.4% of our revenues were derived from advertising, 19.7% from circulation and 11.9% from commercial printing and distribution operations.

Our Strategy

        We aim to increase profitability and cash flow by pursuing the following business and operating strategies:

•

Increase advertising revenue.  We are further targeting national and multi-market accounts, offering advertising packages bundled by market instead of by publication, implementing value-based advertising pricing and marketing strategies, and expanding and improving the effectiveness of our sales force.

•

Increase circulation revenue.  We are increasing the number of newspaper boxes and point-of-sale locations, expanding home delivery and investing in technology to enhance the effectiveness of

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our delivery and distribution operations. We also plan to continue to expand coverage of local news in our newspapers to broaden their appeal.

•

Expand complementary products and services.  We plan to continue to diversify our revenue streams by leveraging our newspaper brands to develop specialty and niche products and developing new media services to provide complementary advertising vehicles. We also intend to market more aggressively excess capacity at our printing facilities and the capabilities of our distribution network.

•

Reduce costs.  We have expanded our implementation of "best practices" policies and benchmarking standards throughout our operations to improve efficiency and reduce costs. We continue to seek lower cost alternatives for, and improve the utilization of, key resources, as well as invest in new technologies to streamline our production process. We also intend to more rigorously control the distribution of copies of our free newspapers.

•

Achieve efficiencies through geographic clustering.  We plan to continue to concentrate our ownership of publications into regional clusters to help us realize operating efficiencies. We believe this strategy will also enable us to offer advertisers bundled packages encompassing some or all of our publications in a cluster.

•

Further integrate newspaper operations with the Quebecor Media group of companies.  We will continue to leverage Quebecor Media's television broadcasting, cable distribution and new media assets to promote our newspaper brands and enhance our content, as well as attract advertisers through comprehensive advertising packages encompassing some or all of Quebecor Media's platforms.

The Transactions

        Concurrently with the completion of the private placement offering of our old notes on February 7, 2003, we entered into a new senior secured credit facility consisting of a $75.0 million revolving facility and a US$230.0 million term loan B. See "Description of Certain Indebtedness—New Credit Facility."

        We used the net proceeds from the issuance of the old notes and borrowings under the new credit facility, as well as additional cash then available, to:

•

repay borrowings under our old credit facility, which, as of December 31, 2002, amounted to $300.5 million;

•

redeem on March 10, 2003 our two series of senior subordinated notes then outstanding for an aggregate amount of $238.5 million (including an aggregate redemption premium of approximately $8.6 million); and

•

declare and pay to Quebecor Media, our parent company, dividends in an aggregate amount of $260.0 million, of which $150.0 million will ultimately be used to repay debt of our affiliate Vidéotron and the balance was used by Quebecor Media for general corporate purposes.

Our Shareholder

        We are an indirect, wholly owned subsidiary of Quebecor Media. Quebecor Media is a leading Canadian-based media company with interests in cable operations, our newspaper publishing operations, television broadcasting, business telecommunications, book and magazine publishing and new media services. Through these interests, Quebecor Media holds leading positions in the creation, promotion and distribution of news, entertainment and Internet related services that are designed to appeal to audiences in every demographic category. In addition, Quebecor Media is the largest French-language media company in North America and, through its various operations, reaches approximately 95% of the French-speaking population and 41% of the English-speaking population in Canada every week.

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        Quebecor Media is 54.7% owned by Quebecor Inc., a communications holding company, and 45.3% owned by Capital Communications CDPQ Inc. Quebecor Inc.'s primary assets are its interests in Quebecor Media Inc. and Quebecor World Inc., the world's largest commercial printer and image management company. Capital Communications CDPQ Inc. is a wholly owned subsidiary of Caisse de dépôt et placement du Québec, Canada's largest pension fund with approximately $130 billion in assets. Capital Communications CDPQ Inc. specializes in financing for companies in the telecommunications, media and cultural industry sectors.

Our Corporate History and Structure

        We are a corporation resulting from the amalgamation under the Canada Business Corporations Act on February 28, 1999 of 2944707 Canada Inc., which was incorporated on August 11, 1993, and Sun Media Corporation, or old Sun Media, which was continued from Ontario into the federal jurisdiction on February 12, 1999. We received certification and was continued from the federal jurisdiction into the jurisdiction of the province of British Columbia on July 3, 2001.

        We are an indirect, wholly owned subsidiary of Quebecor Media. We conduct our business operations primarily through our divisions and through Bowes Publishers Limited and Sun Media (Toronto) Corporation, which are our two significant subsidiaries. We hold 100% of the outstanding shares of both Bowes Publishers Limited and Sun Media (Toronto) Corporation, and these subsidiaries are both British Columbia companies.

Our Principal Executive Office

        Our principal executive office is located at 333 King Street East, Toronto, Ontario, Canada M5A 3X5. Our telephone number is (416) 947-2222. Our registered office is located at 800 Park Place, 666 Burrard Street, Vancouver, British Columbia, Canada V6C 3P3.

The Exchange Offer

        On February 7, 2003, we sold our 7⁵/8% Senior Notes due 2013 in a private placement exempt from the registration requirements of the Securities Act, and the initial purchasers of these old notes then resold them in reliance on other exemptions from the registration requirements of the Securities Act. Consequently, the old notes are subject to transfer restrictions under the Securities Act. We and the subsidiary guarantors of the old notes entered into a registration rights agreement with the initial purchasers. Under the registration rights agreement, we agreed, among other things, to deliver to you this prospectus and to keep the exchange offer open for not less than 30 days and not more than 45 days (or, in each case, longer if required by applicable law) after the date notice of the exchange offer is mailed to the holders of the old notes. In addition, we agreed that if the exchange offer is not completed by July 7, 2003, we will file, and use our best efforts to cause to become effective, a shelf registration statement covering the resale of the old notes. You are entitled to exchange in the exchange offer your old notes for new notes, which are identical in all material respects to the old notes except that:

•

the new notes have been registered under the Securities Act and will be freely tradeable by persons who are not affiliated with us;

•

the new notes are not entitled to the rights that are applicable to the old notes under the registration rights agreement; and

•

our obligation to pay special interest on the old notes if (a) the exchange offer registration statement that includes this prospectus is not declared effective by June 9, 2003 or (b) if the exchange offer is not consummated by July 7, 2003, in each case at incremental rates ranging from 0.25% per annum to 1.0% per annum, depending on how long we fail to comply with these deadlines, does not apply to the new notes.

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The Exchange Offer	We are offering to exchange up to US$205.0 million aggregate principal amount of our new 75/8% Senior Notes due 2013, which have been registered under the Securities Act, for up to US$205.0 million aggregate principal amount of our old 75/8% Senior Notes due 2013, which were issued on February 7, 2003 pursuant to a private placement offering. Old notes may be exchanged only in integral multiples of US$1,000.
Resale of the New Notes	Based on interpretations by the staff of the SEC set forth in no-action letters issued to third parties, we believe that the new notes issued in the exchange offer may be offered for resale, resold and otherwise transferred by you (unless you are our "affiliate" within the meaning of Rule 405 under the Securities Act) without compliance with the registration and prospectus delivery requirements of the Securities Act, provided that you are:
	•	acquiring the new notes in the ordinary course of business;
	•	not participating, do not intend to participate, and have no arrangement or understanding with any person to participate in the distribution of the new notes; and
	•	not a broker-dealer who purchased your old notes directly from us for resale pursuant to Rule 144A or any other available exemption under the Securities Act.
	We do not intend to seek our own no-action letter, and there is no assurance that the SEC staff would make a similar determination with respect to the new notes. If this interpretation is inapplicable and you transfer any new notes issued to you in the exchange offer without delivering a prospectus or without an exemption under the Securities Act, you may incur liability under the Securities Act. We do not assume or indemnify you against this liability.
	Each broker-dealer that receives new notes for its own account in exchange for the old notes that were acquired by this broker-dealer as a result of market-making activities or other trading activities must acknowledge that it will deliver a prospectus in connection with any resale of those new notes. See "Plan of Distribution."
	Any holder of old notes who:
	•	is our "affiliate" as defined in Rule 405 under the Securities Act;
	•	does not acquire the new notes in the ordinary course of its business;
	•	tenders in the exchange offer with the intention to participate, or for the purpose of participating, in a distribution of the new notes; or
	•	is a broker-dealer that purchased old notes from us to resell them pursuant to Rule 144A or any other available exemption under the Securities Act,
	cannot rely on the position of the SEC staff expressed in the no-action letters described above and, in the absence of an exemption, must comply with the registration and prospectus delivery requirements of the Securities Act in connection with the resale of the new notes.
Expiration of Exchange Offer	The exchange offer will expire at 5:00 p.m., New York City time, on              , 2003, unless we decide to extend the expiration date.
Withdrawal Rights	You may withdraw the tender of your old notes at any time prior to 5:00 p.m., New York City time, on the expiration date.

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Accrued Interest on the New Notes and the Outstanding Notes	The new notes will bear interest from the most recent date to which interest has been paid on the old notes or, if no interest has been paid on the old notes, from February 7, 2003.
Conditions to the Exchange Offer	The exchange offer is subject to customary conditions, some of which we may waive. See "The Exchange Offer—Conditions to the Exchange Offer."
Procedures for Tendering Old Notes	If you wish to exchange your old notes for new notes pursuant to the exchange offer, you must complete, sign and date the letter of transmittal according to the instructions contained in this prospectus and the letter of transmittal. You must also mail or otherwise deliver the letter of transmittal, together with your old notes and any other required documents, to the exchange agent at the address set forth on the cover of the letter of transmittal. If you hold old notes through The Depository Trust Company, or DTC, and wish to participate in the exchange offer, you must comply with the Automated Tender Offer Program procedures of DTC, by which you will agree to be bound by the letter of transmittal.
	By signing or agreeing to be bound by the letter of transmittal, you will represent to us that, among other things:
	•	you are acquiring the new notes in the ordinary course of business;
	•	you have no arrangement or understanding with any person to participate in the distribution of the new notes;
	•	if you are a broker-dealer that will receive new notes for your own account in exchange for old notes that were acquired as a result of market-making or other trading activities, you will deliver a prospectus, as required by law, in connection with any resale of the new notes; and
	•	you are not our "affiliate" as defined in Rule 405 under the Securities Act.
	See "The Exchange Offer—Procedures for Tendering Old Notes."
Special Procedures for Beneficial Owners	If you own a beneficial interest in old notes that are registered in the name of a broker, dealer, commercial bank, trust company or other nominee or custodian, and you wish to tender your old notes in the exchange offer, you should contact the registered holder as soon as possible and instruct the registered holder to tender on your behalf.
Guaranteed Delivery Procedures	If you wish to tender your old notes and your old notes are not immediately available or you cannot deliver your old notes, the letter of transmittal or any other documents required by the letter of transmittal to the exchange agent or comply with the applicable procedures under DTC's Automated Tender Offer Program by the expiration date, you must tender your old notes pursuant to the guaranteed delivery procedures described in this prospectus under the heading "The Exchange Offer—Procedures for Tendering Old Notes—Guaranteed Delivery Procedures."

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Consequences of Failure to Exchange the Old Notes for the New Notes	All unexchanged old notes will continue to be subject to transfer restrictions. In general, the old notes may not be offered or sold unless registered under the Securities Act or pursuant to an exemption from registration under the Securities Act and applicable state securities laws. Therefore, the market for secondary resales of any unexchanged old notes is likely to be minimal. Other than in connection with the exchange offer, we do not currently anticipate that we will register the old notes under the Securities Act.
Federal Income Tax Consequences	The exchange of the old notes for the new notes will generally not be a taxable event for U.S. federal income tax purposes. See "Tax Considerations—U.S. Federal Income Tax Considerations."
Use of Proceeds	We will not receive any cash proceeds from the issuance of the new notes in the exchange offer. We will pay all expenses incident to the exchange offer. See "Use of Proceeds" and "The Exchange Offer—Fees and Expenses."
Exchange Agent for Notes	National City Bank is the exchange agent for the exchange offer.

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The New Notes

Issuer	Sun Media Corporation, a company under the laws of British Columbia.
Notes Offered	US$205.0 million aggregate principal amount of 75/8% Senior Notes due 2013.
Maturity	February 15, 2013.
Interest Payment Dates	February 15 and August 15 of each year, beginning on August 15, 2003.
Ranking	The old notes are, and the new notes will be:
	•	our unsecured senior obligations;
	•	effectively junior in right of payment to all of our and the subsidiary guarantors' existing and future secured debt, including any borrowings under our new credit facility, to the extent of the value of the assets securing that debt;
	•	effectively junior in right of payment to all debt and other obligations (including trade payables) of any of our subsidiaries that do not guarantee the notes;
	•	equal in right of payment to all of our and the subsidiary guarantors' existing and future unsecured debt that does not expressly provide that it is subordinated to the notes or subsidiary guarantees, as applicable; and
	•	senior in right of payment to all of our and the subsidiary guarantors' existing and future debt that expressly provides that it is subordinated to the notes or subsidiary guarantees, as applicable.
	As of December 31, 2002, on a pro forma consolidated basis after giving effect to the completion of the offering of the old notes and the transactions described under "— The Transactions," we would have had $661.2 million in principal amount of senior debt, including $349.0 million of senior secured debt, and the subsidiary guarantors would have had no debt, other than intercompany debt and the obligations under the subsidiary guarantees. In addition, $75.0 million of additional senior secured debt would have been available for borrowing under our revolving credit facility of our new credit facility, of which $0.3 million would have been used to replace outstanding letters of credit. The indenture will permit us, subject to specified limitations, to incur additional debt, some or all of which may be senior debt and some of which may be secured. For more information about the transactions, see "— The Transactions."
Guarantees	The old notes are, and the new notes will be, fully and unconditionally guaranteed, jointly and severally, on a senior unsecured basis, by all of our existing and future restricted subsidiaries that guarantee other indebtedness.
Optional Redemption	At any time on or after February 15, 2008, we may redeem some or all of the notes at the redemption prices specified in this prospectus under "Description of the Notes—Optional Redemption."

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	At any time prior to February 15, 2006, we may redeem up to 35% of the aggregate principal amount of the notes in an amount not to exceed the amount of proceeds of one or more equity offerings, at a price equal to 107.625% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, provided that at least 65% of the original aggregate principal amount of the notes issued remains outstanding after the redemption.
Covenants	We issued the old notes, and will issue the new notes, as a single series of securities under an indenture among us, our subsidiary guarantors and National City Bank, as trustee. The indenture includes covenants that limit our ability and the ability of our restricted subsidiaries to:
	•	incur additional debt, including guarantees by our restricted subsidiaries;
	•	pay dividends and make other restricted payments;
	•	create liens;
	•	use the proceeds from sales of assets and subsidiary stock;
	•	create or permit restrictions on the ability of our restricted subsidiaries to pay dividends or make other distributions to us;
	•	engage in transactions with affiliates;
	•	enter into sale and leaseback transactions; and
	•	consolidate, merge or sell all or substantially all of our assets.
	As of the date of this prospectus, all of our subsidiaries are restricted subsidiaries, as defined in the indenture. These covenants are subject to a number of important exceptions and qualifications described under "Risk Factors—Risks Relating to the Notes" and "Description of the Notes—Covenants."
Change of Control	Following a change of control, we will be required to offer to purchase all the notes at a purchase price of 101% of their principal amount, plus accrued and unpaid interest, if any, to the date of purchase.
Additional Amounts and Tax Redemptions	We are required to make all payments to you under the notes without withholding or deduction for Canadian taxes. If, however, we are required by law or the interpretation or the administration thereof to withhold or deduct amounts for Canadian taxes, we are required to pay you such additional amounts as may be necessary so that the net amount received by you after such withholding or deduction will not be less than the amount you would have received in the absence of such withholding or deduction.
	We may redeem the notes in whole but not in part at any time at a price equal to 100% of their principal amount, plus accrued and unpaid interest, if any, to the redemption date in the event of certain changes affecting Canadian withholding taxes.

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Absence of an Established Market for the New Notes	The old notes are presently eligible for trading in the Private Offerings, Resales, and Trading through Automated Linkages Market, commonly referred to as the Portal Market. The new notes, however, are a new issue of securities, and currently there is no market for them. We do not intend to apply for the new notes to be listed on any securities exchange or to arrange for any quotation system to quote them. The initial purchasers have advised us that they intend to make a market for the new notes, but they are not obligated to do so. The initial purchasers may discontinue any market-making in the new notes at any time in their sole discretion. Accordingly, we cannot assure you that a liquid market will develop for the new notes.
Tax Consequences	For a discussion of the possible U.S. and Canadian federal income tax consequences of an investment in the new notes, see "Tax Considerations." You should consult your own tax advisor to determine the U.S., Canadian, provincial, state, local and other tax consequences of an investment in the new notes.
Use of Proceeds	We will not receive any cash proceeds from the issuance of the new notes in the exchange offer. See "Use of Proceeds."
Risk Factors	You should carefully consider the information set forth in the section entitled "Risk Factors" and the other information included in this prospectus in deciding whether to invest in the new notes.

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Summary Consolidated Financial and Operating Data

        The following tables present some consolidated financial information derived from our consolidated balance sheets as at December 31, 2001 and 2002 and statements of income for each of the years ended December 31, 2000, 2001 and 2002 that are included in this prospectus. The consolidated balance sheet as at December 31, 2000 has been derived from our audited consolidated financial statements not included in this prospectus. The information presented below the caption "Operating Data" is not derived from our consolidated financial statements. All information contained in the following tables should be read together with our consolidated financial statements, the notes related to those financial statements and the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations."

        Our consolidated financial statements have been prepared in accordance with Canadian GAAP. For a discussion of the principal differences between Canadian GAAP and U.S. GAAP, see note 18 to our audited consolidated financial statements.

	Year Ended December 31,
	2000			2001			2002
	(dollars in thousands)
AMOUNTS UNDER CANADIAN GAAP
Statement of Income Data:
Revenues	$	850,087		$	838,136		$	853,610
Operating expenses		644,760			637,292			631,277
Depreciation and amortization (1)		46,671			47,259			27,035
Operating income before restructuring charges		158,656			153,585			195,298
Restructuring charges (2)		—			17,800			2,195
Operating income		158,656			135,785			193,103
Financial expenses		53,085			42,070			33,265
Income taxes (3)		42,325			35,611			52,713
Net income (4)		62,274			152,478			309,175
Balance Sheet Data (at period end):
Cash and cash equivalents	$	3,447		$	39,168		$	51,046
Total assets		1,206,409			2,898,046			3,335,892
Total debt		595,195			554,512			515,147
Shareholder's equity (5)		397,426			2,139,193			2,599,080
Other Financial Data and Ratios (unaudited, except capital expenditures):
EBITDA (6)	$	205,327		$	200,844		$	222,333
EBITDA margin (6)		24.2	%		24.0	%		26.0	%
Capital expenditures	$	19,806		$	19,207		$	10,309
Ratio of earnings to fixed charges (7)		2.94	x		5.30	x		11.48	x
Ratio of total debt to EBITDA		2.90	x		2.76	x		2.32	x
Ratio of pro forma total debt to EBITDA (8)								2.95	x

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Operating Data (unaudited) (9):
Monday to Friday circulation		975,400			955,700			937,600
Saturday circulation		1,013,100			973,900			1,004,300
Sunday circulation		1,146,100			1,111,000			1,082,900
Paid daily publications (at period end)		15			15			15
Weekly publications (at period end)		169			172			175
Other publications (at period end)		20			19			18
Total publications (at period end)		204			206			208
AMOUNTS UNDER U.S. GAAP
Statement of Income Data:
Revenues	$	850,087		$	838,136		$	853,610
Operating expenses		645,623			638,275			632,232
Depreciation and amortization (1)		46,548			47,135			27,035
Operating income before restructuring charges		157,916			152,726			194,343
Restructuring charges (2)		5,792			17,800			2,195
Operating income		152,124			134,926			192,148
Financial expenses		53,085			136,556			229,051
Income taxes (3)		38,349			1,762			(16,119	)
Net income		59,718			90,982			181,266
Balance Sheet Data (at period end):
Cash and cash equivalents	$	3,447		$	39,168		$	51,046
Total assets		1,222,266			2,933,195			3,385,389
Total debt (10)		616,354			2,287,816			2,599,871
Shareholder's equity (10)		394,717			443,218			558,453
Other Financial Data and Ratios (unaudited):
EBITDA (6)	$	204,464		$	199,861		$	221,378
EBITDA margin (6)		24.1	%		23.8	%		25.9	%
Ratio of earnings to fixed charges (7)		2.82	x		1.67	x		1.72	x

(1)

Effective January 1, 2002, we implemented Canadian Institute of Chartered Accountants Handbook Section 3062, Goodwill and Other Intangible Assets. The new standard requires that goodwill and intangible assets with indefinite lives no longer be amortized, but instead be tested for impairment at least annually. At January 1, 2002, we had unamortized goodwill in the amount of $751.7 million, which is no longer being amortized. This change in accounting policy is not applied retroactively and the amounts presented for prior periods have not been restated for this change. If this change in accounting policy were applied to the reported consolidated statements of income, the impact of the change, in respect of goodwill and intangible assets with indefinite useful lives not being amortized, would be as follows:

	Year Ended December 31,
	2000		2001
	(in thousands)
AMOUNTS UNDER CANADIAN GAAP
Net income	$	62,274	$	152,478
Add back goodwill amortization net of income taxes		19,838		20,142
Net income before goodwill amortization	$	82,112	$	172,620
AMOUNTS UNDER U.S. GAAP
Net income	$	59,718	$	90,982
Add back goodwill amortization net of income taxes		19,715		20,018
Net income before goodwill amortization	$	79,433	$	111,000

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(2)

During 2002, we implemented restructuring initiatives which resulted in the termination of approximately 60 employees. The 2002 results include a charge of $2.2 million, representing severance and other personnel-related costs relating to these initiatives. We also implemented two restructuring initiatives during 2001, resulting in a reduction of over 350 employees. A charge of $17.8 million was recorded in 2001 and consisted primarily of severance, benefits and other personnel-related costs.

(3)

The net cash payments for income taxes were $28.0 million in the year ended December 31, 2000 and $3.5 million in the year ended December 31, 2001 and net cash receipts of $0.6 million in the year ended December 31, 2002.

(4)

Net income for the year ended December 31, 2001 includes dividend income of $95.3 million related to our investment in $1.6 billion of the preferred shares of Quebecor Media, our parent company. Our investment in the preferred shares of Quebecor Media rose to $1.95 billion for the year ended December 31, 2002, and similarly, net income for the year ended December 31, 2002 includes dividend income of $203.2 million. See note 5 to our audited consolidated financial statements.

(5)

Shareholder's equity as of December 31, 2001 includes the outstanding balance on the $1.6 billion convertible obligation issued by us to our parent, Quebecor Media, in July 2001. On November 28, 2002, we issued a new convertible obligation to Quebecor Media in the amount of $350.0 million with terms and conditions substantially similar to the $1.6 billion convertible obligation issued in July 2001. Shareholder's equity as of December 31, 2002 includes the outstanding balance on $1.95 billion of these convertible obligations. These convertible obligations are classified as equity under Canadian GAAP because we may elect to convert their unpaid principal amounts and interest into our common shares at any time. The interest on the convertible obligations is charged to retained earnings. See note 9 to our audited consolidated financial statements.

(6)

See footnote 7 to the tables under "Selected Consolidated Financial and Operating Data."

(7)

For the purpose of calculating the ratios of earnings to fixed charges, (i) earnings consist of income from continuing operations before income taxes and non-controlling interest, plus fixed charges, and (ii) fixed charges consist of interest expense, plus amortized premiums, discounts and capitalized expenses related to indebtedness. On a pro forma basis, after giving effect to the transactions described in "Capitalization" as if they had occurred on December 31, 2002, the ratio of earnings to fixed charges would have been 10.27x under Canadian GAAP, and 1.69x under U.S. GAAP. For the purposes of calculating the pro forma ratio of earnings to fixed charges under Canadian GAAP, earnings included dividend income related to our investment in the Quebecor Media preferred shares, which was $203.2 million for the year ended December 31, 2002. If that dividend income had been excluded from earnings, the pro forma ratio of earnings to fixed charges would have been 5.02x under Canadian GAAP.

(8)

The ratio of pro forma total debt to EBITDA has been calculated on a pro forma basis after giving effect to the transactions described in "Capitalization" as if they had occurred on December 31, 2002, by dividing total debt of $655.8 million by EBITDA for the year ended December 31, 2002 of $222.3 million.

(9)

Circulation figures represent the average daily paid circulation for the period indicated and include only the 15 paid daily newspapers that we publish.

(10)

Under U.S. GAAP, total debt as of December 31, 2001 includes the outstanding balance on the $1.6 billion convertible obligation issued by us to our parent Quebecor Media in July 2001. On November 28, 2002, we issued a new convertible obligation to Quebecor Media in the amount of $350.0 million with terms and conditions substantially similar to the $1.6 billion convertible obligation issued in July 2001. Under U.S. GAAP, total debt as of December 31, 2002 includes the outstanding balance on $1.95 billion of these convertible obligations. These convertible obligations are classified as equity under Canadian GAAP because we may elect to convert their unpaid principal amounts and interest into our common shares at any time. Shareholder's equity under U.S. GAAP, as of each of December 31, 2001 and December 31, 2002, does not include the applicable outstanding balance on these convertible obligations. See note 18 to our audited consolidated financial statements.

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RISK FACTORS

        An investment in the new notes involves risk. You should consider carefully the risks described below as well as the other information and data included in this prospectus before deciding to invest in the new notes.

Risks Relating to the Notes

If you do not properly tender your old notes, you will not receive new notes in the exchange offer, and you may not be able to sell your old notes.

        We registered the new notes, but not the old notes, under the Securities Act. We will issue new notes only in exchange for old notes that are timely received by the exchange agent, together with all required documents, including a properly completed and duly signed letter of transmittal. Therefore, you should allow sufficient time to ensure timely delivery of the old notes, and you should carefully follow the instructions on how to tender your old notes.

        Neither we nor the exchange agent is required to tell you of any defects or irregularities with respect to your tender of the old notes. If you do not tender your old notes or if we do not accept your old notes because you did not tender your old notes properly, then, after we consummate the exchange offer, you will continue to hold old notes that are subject to the existing transfer restrictions. In general, you may not offer or sell the old notes unless they are registered under the Securities Act or offered or sold in a transaction exempt from, or not subject to, the registration requirements of the Securities Act and applicable state securities laws.

        Although we may in the future seek to acquire unexchanged old notes in open market or privately negotiated transactions, through subsequent exchange offers or otherwise, we have no present plans to acquire any unexchanged old notes or to file with the SEC a shelf registration statement to permit resales of any unexchanged old notes. In addition, holders who do not tender their old notes, except for initial purchasers or holders of old notes who are not eligible to participate in the exchange offer or do not receive freely tradeable new notes pursuant to the exchange offer, will not have any further registration rights and will not have the right to receive special interest on their old notes.

The market for the old notes may be significantly more limited after the exchange offer.

        Because we anticipate that most holders of old notes will elect to exchange their old notes, we expect that the liquidity of the market for any old notes remaining after the completion of the exchange offer may be substantially limited. Any old notes tendered and exchanged in the exchange offer will reduce the aggregate principal amount of the old notes outstanding. Accordingly, the liquidity of the market for any old notes could be adversely affected and you may be unable to sell them. The extent of the market for the old notes and the availability of price quotations would depend on a number of factors, including the number of holders of old notes remaining outstanding and the interest of securities firms in maintaining a market in the old notes. An issue of securities with a smaller number of units available for trading may command a lower, and more volatile, price than would a comparable issue of securities with a larger number of units available for trading. Therefore, the market price for the old notes that are not exchanged may be lower and more volatile as a result of the reduction in the aggregate principal amount of the old notes outstanding.

Our substantial indebtedness and significant interest payment requirements could adversely affect our financial condition and prevent us from fulfilling our obligations under the notes.

        We currently have a substantial amount of indebtedness. After giving effect to the offering of the old notes and the transactions described under "Summary—The Transactions" and the application of net proceeds from these transactions, as of December 31, 2002, we would have had total debt of

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$655.8 million, the pro forma ratio of our total debt to EBITDA for the year ended December 31, 2002 would have been 2.95x, and the pro forma ratio of earnings to fixed charges for the year ended December 31, 2002 would have been 10.27x. For more information, see "Capitalization."

        Our substantial indebtedness could have significant consequences, including the following:

•

increase our vulnerability to general adverse economic and industry conditions;



•

require us to dedicate a substantial portion of our cash flow from operations to making interest and principal payments on our indebtedness;



•

limit our ability to fund capital expenditures, working capital and other general corporate purposes;



•

limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;



•

place us at a competitive disadvantage compared to our competitors that have less debt; and



•

limit our ability to borrow additional funds on commercially reasonable terms, if at all.

We will need a significant amount of cash to service our debt. Our ability to generate cash depends on many factors beyond our control.

        Our ability to meet our debt service requirements, including those with respect to the notes, will depend on our ability to generate cash. Our ability to generate cash depends on many factors beyond our control, such as competition, general economic conditions and newsprint prices. We cannot assure you that we will generate sufficient cash flow from operations or that future distributions will be available to us in amounts sufficient to pay our indebtedness, including the notes, or to fund our other liquidity needs.

Restrictive covenants in our debt instruments may reduce our operating and financial flexibility, which may prevent us from capitalizing on business opportunities and taking some actions.

        The terms of our new credit facility and the indenture contain operating and financial covenants that restrict our ability to, among other things:

•

incur additional debt, including guarantees by our restricted subsidiaries;



•

pay dividends and make other restricted payments;



•

create liens;



•

use the proceeds from sales of assets and subsidiary stock;



•

create or permit restrictions on the ability of our restricted subsidiaries to pay dividends or make other distributions to us;



•

engage in transactions with affiliates;



•

enter into sale and leaseback transactions; and



•

consolidate, merge or sell all or substantially all of our assets.

        In addition, events beyond our control, including prevailing economic, financial and industry conditions, may affect our ability to comply with covenants contained in the indenture, the new credit facility and the agreements governing other debt to which we are or may become a party. Our failure to comply with these covenants could result in an event of default which, if not cured or waived, could result in an acceleration of our debt and cross-defaults under our other debt. This acceleration and these cross-defaults could require us to repay or repurchase debt prior to the date it otherwise is due,

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which could adversely affect our financial condition. Acceleration of any debt outstanding under the new credit facility or any of our other debt could prevent us from making interest and principal payments on the notes. Even if we are able to comply with all the applicable covenants, the restrictions on our ability to manage our business in our sole discretion could adversely affect our business by, among other things, limiting our ability to take advantage of financings, mergers, acquisitions and other corporate opportunities that we believe would be beneficial to us.

We may still be able to incur substantially more debt, which could increase the risks described above.

        The terms of our new credit facility and the indenture do not fully prohibit us or our subsidiaries from incurring additional debt. As of December 31, 2002, on a pro forma basis, we would have had $75.0 million available for additional borrowings under our new credit facility, of which $0.3 million would have been used to replace outstanding letters of credit. We may be able to incur substantial additional debt in the future. If we do so, the risks described above could intensify.

We depend, to a certain extent, on our subsidiaries for cash needed to service our obligations under the notes.

        For the year ended December 31, 2002, our subsidiaries generated approximately 36% of our revenues (before intercompany eliminations) and held approximately 47% of our consolidated total assets. We, therefore, need the cash generated by our subsidiaries from their operations and their borrowings to service our obligations, including the notes. Our subsidiaries are not obligated to make funds available to us.

        Our subsidiaries' ability to make payments to us will depend upon their operating results and will also be subject to applicable laws and contractual restrictions. Some of our subsidiaries may become subject to loan agreements and indentures that restrict sales of assets and prohibit or significantly restrict the payment of dividends or the making of distributions, loans or advances to shareholders and partners. The indenture permits our subsidiaries to incur debt with similar prohibitions and restrictions in the future.

We may not be able to finance a change of control offer as required by the indenture because we may not have sufficient funds at the time of the change of control or our new credit facility may not allow the repurchases.

        If we experienced a change of control as described below under the heading "Description of the Notes," we would be required to make an offer to purchase all of the notes then outstanding at 101.0% of their principal amount, plus accrued and unpaid interest to the date of purchase. However, we may not have sufficient funds at the time of the change of control to make the required repurchase of the notes, and restrictions in our new credit facility may not allow these repurchases. See "Description of the Notes—Repurchase at the Option of Holders."

        In addition, under our new credit facility, a change of control would be an event of default. Any future credit agreement or other agreements relating to our senior indebtedness to which we become a party may contain similar provisions. Our failure to purchase the notes upon a change of control under the indenture would constitute an event of default under the indenture. This default would, in turn, constitute an event of default under our new credit facility and may constitute an event of default under future senior indebtedness, any of which may cause the related debt to be accelerated after any applicable notice or grace periods. If debt were to be accelerated, we may not have sufficient funds to repurchase the notes and repay the debt.

Canadian bankruptcy and insolvency laws may impair the trustee's ability to enforce remedies under the notes.

        The rights of the trustee who represents the holders of the notes to enforce remedies could be delayed by the restructuring provisions of applicable Canadian federal bankruptcy, insolvency and other

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restructuring legislation if the benefit of such legislation is sought with respect to us. For example, both the Bankruptcy and Insolvency Act (Canada) and the Companies' Creditors Arrangement Act (Canada) contain provisions enabling an insolvent person to obtain a stay of proceedings against its creditors, and to file a proposal to be voted on by the various classes of its affected creditors. A restructuring proposal, if accepted by the requisite majorities of each affected class of creditors, and if approved by the relevant Canadian court, would be binding on all creditors within each affected class, including those creditors that did not vote to accept the proposal. Moreover, this legislation, in certain instances, permits the insolvent debtor to retain possession and administration of its property, subject to court oversight, during the period that the stay against proceedings remains in place, even though this debtor may be in default under the applicable debt instrument.

        The powers of the court under the Bankruptcy and Insolvency Act (Canada), and particularly under the Companies' Creditors Arrangement Act (Canada), have been exercised broadly to protect a restructuring entity from actions taken by creditors and other parties. Accordingly, we cannot predict whether payments under the notes would be made during any proceedings in bankruptcy, insolvency or other restructuring, whether or when the trustee could exercise its rights under the indenture or whether and to what extent holders of the notes would be compensated for any delays in payment of principal, interest and costs, including the fees and disbursements of the trustee.

An active trading market for the new notes may not develop.

        There is currently no public market for the new notes. The new notes are a new issue of securities with no existing trading market. We do not intend to have the new notes listed on a national securities exchange. We have been informed by the initial purchasers that they currently intend to make a market in the new notes. However, they are not obligated to do so, and may cease their market-making activities at any time without notice. Accordingly, we cannot assure you of the liquidity of the market for the new notes or the prices at which you may be able to sell the new notes.

        In addition, the market for non-investment grade debt has historically been subject to disruptions that have caused volatility in prices. It is possible that the market for the new notes will be subject to disruptions. Any such disruptions may have a negative effect on you, as a holder of the new notes, regardless of our prospects and financial performance.

Non-U.S. holders of the notes are subject to restrictions on the resale of the notes.

        We sold the old notes in reliance on exemptions from applicable Canadian provincial securities laws and the laws of other jurisdictions where the notes were offered and sold, and therefore the old notes may be transferred and resold only in compliance with the laws of those jurisdictions to the extent applicable to the transaction, the transferor and/or the transferee. Although we registered the new notes under the Securities Act, we did not, and do not intend to, qualify by prospectus in Canada the new notes, and, accordingly, the new notes will remain subject to restrictions on resale in Canada. In addition, non-U.S. holders will remain subject to restrictions imposed by the jurisdiction in which the holder is resident. See "The Exchange Offer—Resale of the New Notes."

Applicable statutes allow courts, under specific circumstances, to void the subsidiary guarantees of the notes.

        Our creditors or the creditors of one or more subsidiary guarantors could challenge the subsidiary guarantees as fraudulent transfers, conveyances or preferences or on other grounds under applicable U.S. federal or state law or applicable Canadian federal or provincial law. The entering into of the subsidiary guarantees could be found to be a fraudulent transfer, conveyance or preference or otherwise void if a court determined that:

•

a subsidiary guarantor delivered its subsidiary guarantee with the intent to defeat, hinder, delay or defraud its existing or future creditors;

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•

the subsidiary guarantor did not receive fair consideration for the delivery of the subsidiary guarantee; or



•

the subsidiary guarantor was insolvent at the time it delivered the subsidiary guarantee.

        To the extent a court voids a subsidiary guarantee as a fraudulent transfer, preference or conveyance or holds it unenforceable for any other reason, holders of notes would cease to have any direct claim against the subsidiary guarantor that delivered that subsidiary guarantee. If a court were to take this action, the subsidiary guarantor's assets would be applied first to satisfy the subsidiary guarantor's liabilities, including trade payables and any preferred stock claims, before any portion of its assets could be distributed to us to be applied to the payment of the notes. We cannot assure you that a subsidiary guarantor's remaining assets would be sufficient to satisfy the claims of the holders of notes relating to any voided portions of the subsidiary guarantees.

U.S. investors in the notes may have difficulties enforcing civil liabilities.

        We are governed by the laws of British Columbia. Moreover, substantially all of our directors, controlling persons and officers, as well as some of the experts named in this prospectus, are residents of Canada or other jurisdictions outside of the United States, and all or a substantial portion of our assets and their assets are located outside of the United States. As a result, it may be difficult for holders of notes to effect service of process upon us or these persons within the United States or to enforce against us or them in the United States, judgments of courts of the United States predicated upon the civil liability provisions of the U.S. federal securities laws or other laws of the United States. In addition, we have been advised by our Canadian counsel that there is doubt as to the enforceability in Canada of liabilities predicated solely upon U.S. federal securities law against us, our directors, controlling persons and officers and the experts named in this prospectus who are not residents of the United States, in original actions or in actions for enforcements of judgments of U.S. courts.

Risks Relating to Our Business

Our revenue is subject to cyclical and seasonal variations.

        Our business is sensitive to general economic cycles. Our operating results are sensitive to prevailing local, regional and national economic conditions because of our dependence on advertising sales for a substantial portion of our revenue. Because a substantial portion of our advertising revenue is derived from local advertisers, our operating results in individual markets could be adversely affected by local or regional economic downturns. Similarly, a substantial portion of our advertising revenue is derived from retail advertisers, who have historically been sensitive to general economic cycles, and our operating results have in the past been materially adversely affected by extended downturns in the Canadian retail sector. In addition, most of our advertising contracts are short-term contracts that can be terminated by the advertisers at any time with little notice. Also, newspaper publishing is labor intensive and, as a result, our business has a relatively high fixed cost structure. During periods of economic contraction, revenue may decrease while some of our costs remain fixed, resulting in decreased earnings.

        In addition, our business has experienced and is expected to continue to experience significant fluctuations in operating results due to, among other things, seasonal advertising patterns and seasonal influences on people's reading habits. Given those seasonal patterns, our second and fourth quarters have historically been our strongest quarters, with the fourth quarter generally being the strongest and the first quarter being the weakest. In addition, because the majority of our circulation is based on single-copy rather than subscription sales, our circulation levels are more vulnerable to seasonal weather changes.

17

We may be adversely affected by variations in the cost of newsprint.

        Newsprint represents our single largest raw material expense and one of our most significant operating costs. The newsprint industry is highly cyclical, and newsprint prices have historically experienced significant volatility caused by supply and demand imbalances. Since a period of relatively high prices in 1995, during which prices peaked at US$755 per metric tonne, the industry has experienced two further full pricing cycles. Over the twelve-month period from June 2001 to June 2002, newsprint prices declined approximately 28%, from US$625 to US$450 per metric tonne. In July 2002, newsprint producers announced a US$50 per metric tonne price increase, which was partially implemented in October 2002, and we expect that prices will continue to increase in the near term. Newsprint expense represented 18.2% ($117.2 million) of our total operating expenses (before depreciation, amortization and restructuring charges) for the year ended December 31, 2000, 19.7% ($125.7 million) for the year ended December 31, 2001 and 16.4% ($103.8 million) for the year ended December 31, 2002. As a result, volatile or increased newsprint costs have had, and may in the future have, a material adverse effect on our financial condition and operating results.

        We have entered into a long-term agreement expiring December 31, 2005 with a newsprint manufacturer for the supply of most of our newsprint purchases. Our supply of newsprint may be threatened if this newsprint manufacturer is unable to supply us with sufficient newsprint to meet our needs. Our inability to obtain sufficient newsprint on acceptable terms when needed could materially increase our costs or disrupt our operations.

We operate in a highly competitive industry.

        Revenue generation in the newspaper industry depends primarily on the sale of advertising and paid circulation. Competition for newspaper advertising is largely based on readership, circulation, demographic composition of the market, price and content of the newspaper. Competition for circulation is largely based on price, editorial content, quality of delivery service and availability of publications. Competition for advertising and circulation revenue comes from local, regional and national newspapers, radio, broadcast and cable television, direct mail and other communications and advertising media that operate in our markets. In recent years, competition with online services and other new media technologies has also increased significantly. In addition, consolidation in the Canadian broadcasting, publishing and other media industries has increased significantly, and our competitors include market participants with interests in multiple industries and media. We cannot assure you that our existing and future competitors will not pursue or be capable of achieving business strategies similar or competitive to ours. Some of our competitors have greater financial and other resources than we do. We may not be able to compete successfully in the future against existing or potential competitors, and increased competition may have a material adverse effect on our business, financial condition or operating results.

Two of our publications represent a significant portion of our revenue.

Le Journal de Montréal and The Toronto Sun have historically represented a significant portion of our revenue, and we expect that they will continue to do so for the foreseeable future. Le Journal de Montréal accounted for approximately 19% of our revenue in each of the years ended December 31, 2001 and 2002. Similarly, The Toronto Sun accounted for approximately 17% of our revenue for the year ended December 31, 2001 and 16% of our revenue for the year ended December 31, 2002. During the same periods, we derived approximately 20% of our advertising revenue from Le Journal de Montréal, and The Toronto Sun accounted for approximately 17% of our advertising revenue during the year ended December 31, 2001 and 16% of our advertising revenue during the year ended December 31, 2002. A significant decline in the performance of Le Journal de Montréal or The Toronto Sun or in general advertising spending in the markets they serve could cause our revenue to decrease

18

dramatically, which could have a material adverse effect on our business, financial condition and operating results.

We may be adversely affected by strikes and other labor protests.

        Approximately one-third of our employees are unionized. We are currently a party to 46 collective bargaining agreements. Seven of these collective bargaining agreements (representing approximately 229 employees) will expire on or before December 31, 2003. An additional 30 of these collective bargaining agreements (representing approximately 1,006 employees) will expire on or before December 31, 2006. Currently, there are nine collective bargaining agreements (representing approximately 361 employees) that have expired and are being negotiated for renewal. On January 27, 2003, approximately 160 employees in the editorial department of The Toronto Sun voted to certify a union. We expect to begin negotiating a collective bargaining agreement with these employees in 2003.

        We cannot predict the outcome of any future negotiations relating to union representation or collective bargaining agreements. Pending the outcome of future negotiations, we may experience work stoppages, strikes or other forms of labor protests. Any strikes or other forms of labor protest could disrupt our operations and have a material adverse effect on our business, financial condition or operating results. Even if we do not experience strikes or other forms of labor protests, the outcome of labor negotiations could impair our operating results.

We are controlled by Quebecor Media.

        All of our issued and outstanding common shares are held by 3535991 Canada Inc., a wholly owned subsidiary of Quebecor Media. As a result, Quebecor Media controls our policies and operations. The interests of Quebecor Media, as our sole equity holder, may conflict with the interests of the holders of the notes.

        In addition, Quebecor Media has entered into certain transactions with us to consolidate tax losses within the Quebecor Media group. As a result of these transactions, we recognize significant income tax benefits. Quebecor Media may unwind these transactions at any time in its discretion, eliminating our ability to reduce our income tax obligations. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Purchase of Shares of Quebecor Media and Service of Convertible Obligations."

        Also, Quebecor Media is a holding company with no significant assets other than its equity interests in its subsidiaries. Its principal source of cash needed to pay its own obligations is the cash that its subsidiaries generate from their operations and borrowings. We expect, to the extent permitted by the terms of our indebtedness and applicable law, to continue to pay significant dividends to Quebecor Media in the future. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Payment of Dividends."

We may not successfully implement our business and operating strategies.

        Our business and operating strategies include increasing our advertising and circulation revenues, expanding our complementary products and services, reducing our costs, achieving efficiencies through geographic clustering and further integrating our newspaper operations with the Quebecor Media group of companies. We may not be able to implement these strategies fully or realize their anticipated results. Implementation of these strategies could also be affected by a number of factors beyond our control, such as operating difficulties, increased operating costs, regulatory developments, general or local economic conditions or increased competition. Any material failure to implement our strategies could have a material adverse effect on our business, financial condition and operating results and on our ability to meet our obligations, including our ability to service our indebtedness.

19

We depend on key personnel.

        Our success depends to a large extent upon the continued services of our senior management and our ability to retain skilled employees. There is intense competition for qualified management and skilled employees, and our failure to recruit, retain and train such employees could have a material adverse effect on our business, financial condition or operating results.

We are subject to extensive environmental regulations.

        Substantially all of our facilities are subject to federal, provincial, state and municipal laws concerning, among other things, emissions to the air, water and sewer discharges, handling and disposal of hazardous materials, wastes, recycling, or otherwise relating to protection of the environment. Environmental laws and regulations and their interpretation have changed rapidly in recent years and may continue to do so in the future. Our properties, as well as areas surrounding such properties, particularly those in areas of long-term industrial use, may have had historic uses, including uses related to historic publishing operations, or may have current uses (in the case of surrounding properties) that may affect our properties and require further study or remedial measures. We are not currently planning any material study or remedial measure, and none has been required by regulatory authorities. However, we cannot assure you that all environmental liabilities have been determined, that any prior owner of our properties did not create a material environmental condition not known to us, or that a material environmental condition does not exist at any of our properties.

We may be adversely affected by fluctuations of the exchange rate.

        Virtually all of our revenues and expenses, other than interest expense on U.S. dollar-denominated debt, are denominated in Canadian dollars. Except for our new revolving credit facility of $75.0 million, all our indebtedness is denominated, and interest, principal and any premium on our indebtedness will have to be paid, in U.S. dollars. As a result, we will be exposed to foreign currency exchange risk. We entered into transactions to hedge the exchange rate risk with respect to our U.S. dollar-denominated debt. However, these hedging transactions may not be successful due to any number of reasons, including the default of counterparties to these hedging transactions, and the resulting foreign exchange rate fluctuations may impair our ability to make payments in respect of the notes or our new term loan B under our new credit facility. In addition, we may be required to provide cash or other collateral to secure our obligations with respect to any such hedging transactions. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Quantitative and Qualitative Disclosure about Market Risk" and "Description of Certain Indebtedness—New Credit Facility."

        For the purposes of financial reporting, any change in the value of the Canadian dollar against the U.S. dollar during a given financial reporting period would result in a foreign exchange gain or loss on the translation of any U.S. dollar-denominated debt into Canadian dollars. Consequently, our reported earnings and debt could fluctuate materially as a result of foreign exchange gains or losses.

20

USE OF PROCEEDS

        We will not receive any cash proceeds from the exchange offer. Because we are exchanging the new notes for the old notes, which have substantially identical terms, the issuance of the new notes will not result in any increase in our indebtedness. The exchange offer is intended to satisfy our obligations under the registration rights agreement. The proceeds from the offering of the old notes, net of commissions, was US$197.4 million, or $300.6 million. We applied the net proceeds from the offering of the old notes, together with $349.0 million of borrowings under our new credit facility and additional cash then available, to:

•

repay borrowings under our old credit facility;

•

redeem our two then-existing series of senior subordinated notes; and

•

declare and pay dividends to Quebecor Media in an aggregate amount of $260.0 million, of which $150.0 million will ultimately be used to repay borrowings of our affiliate Vidéotron and the balance was used by Quebecor Media for general corporate purposes.

        Our old credit facility included a revolving credit facility maturing in March 2003 and a term reducing loan maturing in 2005, under which we could borrow at interest rates based on bankers' acceptances and/or prime, plus a margin that was tied to financial ratios. The weighted average interest rate of our borrowings under the old credit facility at December 31, 2002 was 3.8%. As of December 31, 2002, the aggregate amount of credit drawn under the revolving credit facility was $0.3 million used for outstanding letters of credit. The outstanding balance on the term loan was $300.5 million.

        We issued the first series of our then-existing 9¹/2% Senior Subordinated Notes due 2007 in an aggregate principal amount of US$150.0 million. We issued the second series of our then-existing 9¹/2% Senior Subordinated Notes due 2007 in an aggregate principal amount of US$90.0 million. As of December 31, 2002, the outstanding principal amount under the first series of notes was US$97.5 million and under the second series was US$53.5 million. We used $238.5 million to redeem these senior subordinated notes (including an aggregate redemption premium of approximately $8.6 million).

        For purposes of this section "Use of Proceeds," amounts converted from U.S. dollars to Canadian dollars are converted based on the exchange rate applicable in the transactions entered into by us to hedge the foreign exchange risk of the old notes and our new credit facility of $1.5227 to US$1.00, or $1.00 to US$0.6567, and $1.5175 to US$1.00, or $1.00 to US$0.6590, respectively.

21

CAPITALIZATION

        The following table presents our audited actual cash and cash equivalents (including short-term investments) and capitalization, and our unaudited pro forma cash and cash equivalents (including short-term investments) and capitalization, as of December 31, 2002. This table is presented and should be read together with our consolidated financial statements and the related notes included elsewhere in this prospectus. See "Selected Consolidated Financial and Operating Data," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Description of Certain Indebtedness."

        The pro forma capitalization is based on the audited historical consolidated financial statements, adjusted to give pro forma effect to the transactions described in "Use of Proceeds," the unwinding of hedging agreements relating to our then-existing senior subordinated notes and the payment of transaction fees and expenses, as if they had occurred on December 31, 2002. The pro forma capitalization does not purport to represent what our financial position would have been had those transactions occurred on December 31, 2002 or to project our expected financial position at any future date. The pro forma adjustments are based upon available information and assumptions that management believes are reasonable. Management has used certain estimates in preparing the pro forma financial data.

		As of December 31, 2002
		Actual		Pro Forma
		(dollars in millions)
		(audited)		(unaudited)
Cash and cash equivalents and short-term investments		$	125.5	$	17.6
Long-term debt, including current portion:
	New revolving credit facility	$	—	$	—
	Old credit facility		300.5		—
	New term loan B (1)		—		349.0
	Then-existing 91/2% Senior Subordinated Notes due 2007		214.6		—
	75/8% Senior Notes due 2013 (1)(2)		—		306.8
Total debt			515.1		655.8
Total shareholder's equity (3)			2,599.1		2,339.1
Total capitalization		$	3,114.2	$	2,994.9

(1)

Converted from U.S. dollars to Canadian dollars based on the exchange rate applicable in the transactions entered into by us to hedge the foreign exchange risk of the old notes and our new credit facility of $1.5227 to US$1.00, or $1.00 to US$0.6567, and $1.5175 to US$1.00, or $1.00 to US$0.6590, respectively.

(2)

Represents the aggregate principal amount of US$205.0 million, or $312.2 million, less original issue discount of US$3.5 million, or $5.4 million.

(3)

Pro forma total shareholder's equity is adjusted to give pro forma effect solely to $260.0 million of dividends paid to Quebecor Media.

22

SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA

        The following tables present some consolidated financial information derived from our consolidated balance sheets as at December 31, 2001 and 2002 and statements of income for each of the years ended December 31, 2000, 2001 and 2002, which have been audited by KPMG LLP, independent chartered accountants. KPMG LLP's report on the audited consolidated financial statements is included in this prospectus. The consolidated financial information as at December 31, 1998, 1999 and 2000 and the years ended December 31, 1998 and 1999 has been derived from our audited consolidated financial statements not included in this prospectus. The information presented below the caption "Operating Data" is not derived from our consolidated financial statements. All information contained in the following tables should be read in conjunction with our consolidated financial statements, the notes related to those financial statements and the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations."

        Our consolidated financial statements have been prepared in accordance with Canadian GAAP. For a discussion of the principal differences between Canadian GAAP and U.S. GAAP, see note 18 to our audited consolidated financial statements.

	Year Ended December 31,
	1998(1)			1999(1)			2000			2001			2002
	(dollars in thousands)
AMOUNTS UNDER CANADIAN GAAP
Statement of Income Data:
Revenues	$	295,123		$	827,068		$	850,087		$	838,136		$	853,610
Operating expenses		238,296			639,678			644,760			637,292			631,277
Depreciation and amortization (2)		6,929			46,951			46,671			47,259			27,035
Operating income before restructuring charges		49,898			140,439			158,656			153,585			195,298
Restructuring charges (3)		—			—			—			17,800			2,195
Operating income		49,898			140,439			158,656			135,785			193,103
Financial expenses		654			64,268			53,085			42,070			33,265
Income taxes (4)		17,235			35,367			42,325			35,611			52,713
Income from continuing operations		31,680			40,050			62,274			152,478			309,175
Net income (5)		31,680			38,369			62,274			152,478			309,175
Balance Sheet Data (at period end):
Cash and cash equivalents	$	—		$	2,617		$	3,447		$	39,168		$	51,046
Total assets		122,492			1,218,093			1,206,409			2,898,046			3,335,892
Total debt		—			710,207			595,195			554,512			515,147
Capital stock		41,801			301,801			301,801			301,801			301,801
Shareholder's equity (6)		36,566			334,931			397,426			2,139,193			2,599,080
Other Financial Data and Ratios:
Cash from operating activities	$	40,590		$	74,565		$	134,027		$	140,583		$	400,272
Cash used in investing activities		(16,774	)		(606,864	)		(19,705	)		(1,618,497	)		(431,959	)
Cash provided by (used in) financing activities		(600	)		535,937			(113,492	)		1,513,635			43,565
EBITDA (unaudited) (7)		56,827			187,390			205,327			200,844			222,333
EBITDA margin (unaudited) (7)		19.3	%		22.7	%		24.2	%		24.0	%		26.0	%
Capital expenditures	$	4,915		$	13,565		$	19,806		$	19,207		$	10,309
Ratio of earnings to fixed charges (unaudited) (8)		N/A			2.16x			2.94x			5.30x			11.48x
Operating Data (unaudited) (9):
Monday to Friday Circulation					991,100			975,400			955,700			937,600
Saturday Circulation					1,033,200			1,013,100			973,900			1,004,300
Sunday Circulation					1,166,100			1,146,100			1,111,000			1,082,900
Paid Daily Publications (at period end)					16			15			15			15
Weekly Publications (at period end)					158			169			172			175
Other Publications (at period end)					16			20			19			18
Total Publications (at period end)					190			204			206			208

23

AMOUNTS UNDER U.S. GAAP
Statement of Income Data:
Revenues	$	295,123		$	827,068		$	850,087		$	838,136		$	853,610
Operating expenses		239,920			641,247			645,623			638,275			632,232
Depreciation and amortization (2)		6,929			46,951			46,548			47,135			27,035
Operating income before restructuring charges		48,274			138,870			157,916			152,726			194,343
Restructuring charges (3)		—			2,394			5,792			17,800			2,195
Operating income		48,274			136,476			152,124			134,926			192,148
Financial expenses		654			64,268			53,085			136,556			229,051
Income taxes (4)		16,585			33,781			38,349			1,762			(16,119	)
Net income		30,706			35,992			59,718			90,982			181,266
Balance Sheet Data (at period end):
Cash and cash equivalents	$	—		$	2,617		$	3,447		$	39,168		$	51,046
Total assets		121,414			1,208,336			1,222,266			2,933,195			3,385,389
Total debt (10)		—			710,207			616,354			2,287,816			2,599,871
Shareholder's equity (10)		38,791			334,778			394,717			443,218			558,453
Other Financial Data and Ratios (unaudited):
EBITDA (7)	$	55,203		$	185,821		$	204,464		$	199,861		$	221,378
EBITDA margin (7)		18.7	%		22.5	%		24.1	%		23.8	%		25.9	%
Ratio of earnings to fixed charges (8)		N/A			2.12x			2.82x			1.67x			1.72x

(1)

For financial reporting purposes, Quebecor Newspapers is our predecessor. Its consolidated results, therefore, are reflected for the year ended December 31, 1998. For subsequent years, the consolidated results include the results of Old Sun Media only from January 7, 1999, the date of its acquisition by Quebecor Newspapers.

(2)

Effective January 1, 2002, we implemented Canadian Institute of Chartered Accountants Handbook Section 3062, Goodwill and Other Intangible Assets. The new standard requires that goodwill and intangible assets with indefinite lives no longer be amortized, but instead be tested for impairment at least annually. At January 1, 2002, we had unamortized goodwill in the amount of $751.7 million, which is no longer being amortized. This change in accounting policy is not applied retroactively and the amounts presented for prior periods have not been restated for this change. If this change in accounting policy were applied to the reported consolidated statements of income, the impact of the change, in respect of goodwill and intangible assets with indefinite useful lives not being amortized, would be as follows:

	Year Ended December 31,
	1999		2000		2001
	(in thousands)
AMOUNTS UNDER CANADIAN GAAP
Net income	$	38,369	$	62,274	$	152,478
Add back goodwill amortization net of income taxes		19,319		19,838		20,142
Net income before goodwill amortization	$	57,688	$	82,112	$	172,620
AMOUNTS UNDER U.S. GAAP
Net income	$	35,992	$	59,718	$	90,982
Add back goodwill amortization net of income taxes		19,319		19,715		20,018
Net income before goodwill amortization	$	55,311	$	79,433	$	111,000

(3)

During 2002, we implemented restructuring initiatives, which resulted in the termination of approximately 60 employees. The 2002 results include a charge of $2.2 million representing severance and other personnel-related costs relating to these initiatives. We also implemented two restructuring initiatives

24

during 2001, resulting in a reduction of over 350 employees. A charge of $17.8 million was recorded in 2001 and consisted primarily of severance, benefits and other personnel-related costs.

(4)

The net cash payments for income taxes were $28.0 million in the year ended December 31, 2000, $3.5 million in the year ended December 31, 2001 and net cash receipts of $0.6 million in the year ended December 31, 2002.

(5)

Net income for the year ended December 31, 2001 includes dividend income of $95.3 million related to our investment in $1.6 billion of the preferred shares of Quebecor Media, our parent company. Our investment in the preferred shares of Quebecor Media rose to $1.95 billion for the year ended December 31, 2002, and similarly, net income for the year ended December 31, 2002 includes dividend income of $203.2 million. See note 5 to our audited consolidated financial statements.

(6)

Shareholder's equity as of December 31, 2001 includes the outstanding balance on the $1.6 billion convertible obligation issued by us to our parent, Quebecor Media, in July 2001. On November 28, 2002, we issued a new convertible obligation to Quebecor Media in the amount of $350.0 million with terms and conditions substantially similar to the $1.6 billion convertible obligation issued in July 2001. Shareholder's equity as of December 31, 2002 includes the outstanding balance on $1.95 billion of these convertible obligations. These convertible obligations are classified as equity under Canadian GAAP because we may elect to convert their unpaid principal amounts and interest into our common shares at any time. The interest on the convertible obligations is charged to retained earnings. See note 9 to our audited consolidated financial statements.

(7)

EBITDA margin is EBITDA as a percentage of revenues. EBITDA is calculated from net income, and reconciled to cash provided by operating activities, as follows:

		Year Ended December 31,
		1998			1999			2000			2001			2002
		(in thousands)
AMOUNTS UNDER CANADIAN GAAP
Net income		$	31,680		$	38,369		$	62,274		$	152,478		$	309,175
	Restructuring charges		—			—			—			17,800			2,195
	Depreciation and amortization		6,929			46,951			46,671			47,259			27,035
	Financial expenses		654			64,268			53,085			42,070			33,265
	Income taxes		17,235			35,367			42,325			35,611			52,713
	Non-controlling interest		329			754			972			968			1,118
	Loss from discontinued operations		—			1,681			—			—			—
	Dividend income		—			—			—			(95,342	)		(203,168	)
EBITDA as defined			56,827			187,390			205,327			200,844			222,333
	Restructuring charges		—			—			—			(17,800	)		(2,195	)
	Financial expenses		(654	)		(64,268	)		(53,085	)		(42,070	)		(33,265	)
	Current income taxes		(17,235	)		(25,278	)		(23,584	)		(30,786	)		(47,963	)
	Dividend income		—			—			—			—			203,168
	Other items not involving cash		—			245			1,324			1,219			537
	Change in non-cash operating working capital		1,652			(23,524	)		4,045			29,176			57,657
Cash provided by operating activities		$	40,590		$	74,565		$	134,027		$	140,583		$	400,272

25

		Year Ended December 31,
		1998			1999			2000			2001			2002
		(in thousands)
AMOUNTS UNDER U.S. GAAP
Net income		$	30,706		$	35,992		$	59,718		$	90,982		$	181,266
	Restructuring charges		—			2,394			5,792			17,800			2,195
	Depreciation and amortization		6,929			46,951			46,548			47,135			27,035
	Financial expenses		654			64,268			53,085			136,556			229,051
	Income taxes		16,585			33,781			38,349			1,762			(16,119	)
	Non-controlling interest		329			754			972			968			1,118
	Loss from discontinued operations		—			1,681			—			—			—
	Dividend income		—			—			—			(95,342	)		(203,168	)
EBITDA as defined			55,203			185,821			204,464			199,861			221,378
	Restructuring charges		—			(2,394	)		(5,792	)		(17,800	)		(2,195	)
	Financial expenses		(654	)		(64,268	)		(53,085	)		(136,556	)		(229,051	)
	Current income taxes		(17,235	)		(25,278	)		(23,584	)		3,503			21,082
	Dividend income		—			—			—			—			203,168
	Other items not involving cash		—			245			1,401			2,489			(583	)
	Change in non-cash operating working capital		3,276			(19,561	)		10,623			89,086			(10,590	)
Cash provided by operating activities		$	40,590		$	74,565		$	134,027		$	140,583		$	203,209

(8)

For the purpose of calculating the ratios of earnings to fixed charges, (i) earnings consist of income from continuing operations before income taxes and non-controlling interest, plus fixed charges, and (ii) fixed charges consist of interest expense, plus amortized premiums, discounts and capitalized expenses related to indebtedness. On a pro forma basis, after giving effect to the transactions described in "Capitalization" as if they had occurred on December 31, 2002, the ratio of earnings to fixed charges would have been 10.27x under Canadian GAAP, and 1.69x under U.S. GAAP. For the purposes of calculating the pro forma ratio of earnings to fixed charges under Canadian GAAP, earnings included dividend income related to our investment in the Quebecor Media preferred shares, which was $203.2 million for the year ended December 31, 2002. If that dividend income had been excluded from earnings, the pro forma ratio of earnings to fixed charges would have been 5.02x under Canadian GAAP.

(9)

Circulation figures represent the average daily paid circulation for the period indicated and include only the 15 paid daily newspapers that we publish. Operating data are not available for the year ended December 31, 1998.

(10)

Under U.S. GAAP, total debt as of December 31, 2001 includes the outstanding balance on the $1.6 billion convertible obligation issued by us to our parent Quebecor Media in July 2001. On November 28, 2002, we issued a new convertible obligation to Quebecor Media in the amount of $350.0 million with terms and conditions substantially similar to the $1.6 billion convertible obligation issued in July 2001. Under U.S. GAAP, total debt as of December 31, 2002 includes the outstanding balance on $1.95 billion of these convertible obligations. These convertible obligations are classified as equity under Canadian GAAP because we may elect to convert the unpaid principal amounts and interest into our common shares at any time. Shareholder's equity under U.S. GAAP, as of each of December 31, 2001 and December 31, 2002, does not include the applicable outstanding balance on these convertible obligations. See note 18 to our audited consolidated financial statements.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

        The following discussion and analysis provides information concerning our operating results and financial condition. This discussion should be read with our consolidated financial statements and accompanying notes included elsewhere in this prospectus. It also contains forward-looking statements that are subject to a variety of factors that could cause actual results to differ materially from those contemplated by these statements.

General

        Our consolidated financial statements have been prepared in accordance with Canadian GAAP, which in certain aspects differs from U.S. GAAP. Note 18 to our audited consolidated financial statements contains a discussion of the principal differences between Canadian GAAP and U.S. GAAP and the extent to which such differences impact our financial statements.

        We operate our newspaper businesses in urban and community markets. The Urban Daily Group consists mainly of our paid daily newspapers in the eight most populated markets in which we operate, as well as our distribution businesses, Messageries Dynamiques and Dynamic Press Group. The Community Newspaper Group includes the majority of our other publications, including paid daily community newspapers, weekly newspapers and shopping guides, and farming and other specialty publications, in addition to its own distribution sales arm, NetMedia. For the year ended December 31, 2002, the Urban Daily Group accounted for 71.9% of our revenues and 75.1% of our EBITDA. Over the same period, the Community Newspaper Group accounted for 28.1% of our revenues and 24.9% of our EBITDA.

        Our primary sources of revenue are advertising and paid circulation. Our principal categories of advertising revenues are classified, retail and national advertising. Classified advertising is made up of four principal sectors: automobiles, private party, recruitment and real estate. Retail advertising is display advertising principally placed by local businesses and organizations. National advertising is display advertising primarily from advertisers promoting products or services on a national basis. Our circulation revenues are derived from single copy sales and subscription sales.

			Year Ended December 31,
			2000		2001		2002
			(dollars in millions)
Revenues:
	Advertising		$	564.0	$	561.9	$	584.2
	Circulation			175.5		165.0		168.5
	Commercial printing and other			110.6		111.2		100.9
		Total revenues		850.1		838.1		853.6
Operating Expenses:
	Wages and employee benefits			319.5		313.4		318.0
	Newsprint			117.2		125.7		103.8
	Other operating expenses			208.1		198.2		209.5
		Total operating expenses		644.8		637.3		631.3
EBITDA			$	205.3	$	200.8	$	222.3

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Trend Information

        Our business is cyclical in nature. We are dependent on advertising and circulation sales; therefore, operating results are sensitive to prevailing economic conditions, especially in Ontario, Québec and Alberta. Circulation, measured in terms of copies sold, has been generally declining in the industry over the last ten years. Our advertising and circulation revenues have improved since 2001, and we expect that they will continue to improve in 2003.

        Furthermore, competition continues to be intense in the newspaper industry. Free commuter papers launched in the last couple of years, the increased availability of free daily newspapers, and other media sources, such as the Internet, have put downward pressure on advertising and circulation revenue.

        Newsprint prices have had a significant effect on our operating results as newsprint is our principal raw material. The newsprint industry is highly cyclical, and newsprint prices have historically experienced significant volatility caused by supply and demand imbalances. Since a period of relatively high prices in 1995, during which prices peaked at US$755 per metric tonne, the industry has experienced two further full pricing cycles. Over the twelve-month period from June 2001 to June 2002, newsprint prices declined 28%, from US$625 to US$450 per metric tonne. In July 2002, newsprint producers announced a US$50 per metric tonne price increase, which was partially implemented in October 2002, and we expect that prices will continue to increase in early 2003.

        In addition, our business has experienced and is expected to continue to experience significant fluctuations in operating results due to, among other things, seasonal advertising patterns and seasonal influences on people's reading habits. Given those seasonal patterns, our second and fourth quarters have historically been our strongest quarters, with the fourth quarter generally being the strongest and the first quarter being the weakest.

Year Ended December 31, 2002 Compared to Year Ended December 31, 2001

Revenues

        Consolidated revenues for the year ended December 31, 2002 were $853.6 million, compared to $838.1 million for the year ended December 31, 2001, an increase of $15.5 million or 1.8%.

        Advertising revenues were $584.2 million for the year ended December 31, 2002, an increase of $22.3 million, or 4.0%, from $561.9 million for the year ended December 31, 2001. The Urban Daily Group accounted for the majority of this increase, with all the urban dailies except for those serving Toronto and London experiencing higher advertising revenues due primarily to a combination of higher volume and higher earned rates. On average, advertising linage increased by approximately 2.8% for the year ended December 31, 2002, with declines in national advertising linage being more than offset by improvements in the retail and classified sectors. Advertising rates for the Urban Daily Group increased on average by 0.7% compared to the year ended December 31, 2001. Overall, advertising revenues were higher in the Community Newspaper Group, with softness in Ontario being offset by strong growth in Québec.

        Total circulation revenues for the year ended December 31, 2002 increased over the year ended December 31, 2001 by $3.5 million, or 2.1%, from $165.0 million to $168.5 million. The Urban Daily Group accounted for the vast majority of this increase, with the Community Newspaper Group relatively flat year over year. The urban dailies in Ontario experienced the most significant declines in average paid circulation due to the highly competitive newspaper markets in which they operate. However, these declines were offset somewhat by growth in average paid circulation of our other urban dailies, primarily those in Québec.

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        Increases in our advertising and circulation revenues were partially offset by a decrease in commercial printing revenues in the year ended December 31, 2002. Commercial printing and other revenues were $100.9 million for the year ended December 31, 2002, a decline of $10.3 million, or 9.3%, when compared to the year ended December 31, 2001, mainly due to the loss of a significant printing contract and lower newsprint prices, as commercial printing is a cost-plus business.

Operating Expenses

        Wages and employee benefits expenses increased $4.7 million, or 1.5%, during the year ended December 31, 2002 compared to the year ended December 31, 2001, from $313.4 million to $318.0 million. This increase in wages and employee benefits expenses in the year ended December 31, 2002 was a result of normal wage increases, higher pension and benefit costs and staffing for new publications. We were able to minimize the increase in this expense by offsetting increases in salaries and benefits with savings realized from the two downsizing programs in May and October of 2001.

        Newsprint expenses of $103.8 million for the year ended December 31, 2002 represented a $22.0 million, or 17.5%, decline from the year ended December 31, 2001. Approximately $18.4 million of the decline is attributable to lower newsprint prices, while $3.6 million relates to lower newsprint consumption. We are continually improving our printing operations to reduce our newsprint consumption, with measures including the introduction of newsprint waste reduction programs, the management of inventory and the standardization and reduction of the page size of several of our publications.

        Other operating expenses were $209.5 million for the year ended December 31, 2002, an increase of $11.3 million, or 5.7%, over the year ended December 31, 2001. The increase is partially due to the management fee that we began paying to Quebecor Media in 2002. The management fee was $5.1 million for the year ended December 31, 2002. Excluding this management fee, other operating expenses for the year ended December 31, 2002 were $6.2 million, or 3.1%, greater than other operating expenses for the year ended December 31, 2001.

EBITDA

        EBITDA for the year ended December 31, 2002 of $222.3 million was $21.5 million, or 10.7%, higher than EBITDA for the year ended December 31, 2001 of $200.8 million. The increase in revenues, reduction in newsprint prices and effective cost-containment measures introduced in 2001 and continued in 2002 accounted for the majority of the improvement. These factors were partially offset by the management fee that we began paying to Quebecor Media in 2002, and higher payroll expenses as a result of normal wage increases, higher pension and benefit costs, and staffing for new publications, as well as other costs relating to investments in distribution operations.

        Our EBITDA margin for the year ended December 31, 2002 was 26.0%, compared to 24.0% for the year ended December 31, 2001. This improvement in our EBITDA margin was due primarily to a reduction in newsprint prices and effective cost-containment measures introduced in 2001 and continued in 2002.

Depreciation and Amortization

        Depreciation and amortization expenses of $27.0 million in the year ended December 31, 2002 were $20.2 million lower than in the year ended December 31, 2001. Approximately $21.3 million of the decrease was a result of the fact that effective January 1, 2002, we no longer amortize our goodwill, in accordance with Section 3062 of the CICA Handbook.

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Financial Expenses, Dividend Income and Income Taxes

        Financial expenses for the year ended December 31, 2002 were $33.3 million, compared to $42.1 million for the year ended December 31, 2001. This decrease of $8.8 million, or 20.9%, was due to both lower interest rates on our floating rate debt and lower principal amount of debt outstanding. During the year ended December 31, 2002, we made net debt repayments of $37.2 million.

        We earned dividend income of $203.2 million on our investment in Quebecor Media preferred shares during the year ended December 31, 2002, compared to $95.3 million during the year ended December 31, 2001. This increase in dividend income was due to the full-year realization of our investment in July 2001, and an additional investment in November 2002, in the Quebecor Media preferred shares. As of December 31, 2002, we had a receivable of $95.8 million from Quebecor Media, representing the cumulative declared, but unpaid, dividend on these shares. See "—Liquidity and Capital Resources—Purchase of Shares of Quebecor Media and Service of Convertible Obligations."

        The provision for income taxes was $52.7 million in the year ended December 31, 2002, compared to $35.6 million in the year ended December 31, 2001. The effective tax rate, excluding the dividend income, decreased to 33.0% in 2002 from 38.0% in 2001, due mainly to reduced non-deductible expenses and lower statutory tax rates.

Year Ended December 31, 2001 Compared to Year Ended December 31, 2000

Revenues

        Consolidated revenues for the year ended December 31, 2001 were $838.1 million, compared to $850.1 million for the year ended December 31, 2000, a decrease of $12.0 million, or 1.4%.

        Advertising revenues of $561.9 million for the year ended December 31, 2001 represented a decrease of $2.1 million, or 0.4%, from the year ended December 31, 2000. The majority of this decrease came from the Community Newspaper Group. Advertising revenues were soft in the community publications in Ontario, particularly the shopping guides, as well as in Manitoba and in the farming publications. Advertising revenues for the Urban Daily Group were relatively unchanged from 2000 to 2001. Advertising linage for the urban dailies declined approximately 1.6% in the year ended December 31, 2001, although higher advertising rates helped offset the decrease in volume. Again, Ontario was the weakest sector for the urban dailies, with revenues declining in Toronto by 6.0% and London by 7.6%. These declines were offset, however, by growth in Edmonton, Québec City and Montréal, which had increases of 6.7%, 6.1% and 4.8%, respectively.

        Total circulation revenues of $165.0 million in 2001 represented a decrease of $10.5 million, or 6.0%, from 2000. A significant portion of the decrease in revenues was the result of a change in our relationship with certain distribution agents, who became independent agents instead of employees. This resulted in a decrease in revenues of $6.3 million, as well as a decrease in circulation expenses of $6.3 million. Excluding the impact of this change in relationship, total circulation revenues decreased $4.2 million or 2.4%, largely due to a decline in average paid circulation for the urban newspapers of 1.6%. Five of the eight urban dailies experienced declines in their average circulation in the year ended December 31, 2001. The soft economy in 2001 and the highly competitive newspaper market may have contributed to the decline in circulation.

        Commercial printing and other revenues were $111.2 million for the year ended December 31, 2001, an increase of $0.6 million, or 0.5%, over the year ended December 31, 2000. The growth in commercial printing revenues of 3.2% was almost entirely offset by declines in distribution revenues.

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Operating Expenses

        Wages and employee benefits expenses of $313.4 million for the year ended December 31, 2001 represented a decrease of $6.1 million, or 1.9%, over the year ended December 31, 2000. In response to the sudden downturn in the economy in 2001, we completed two significant downsizing programs in May and October of 2001. These restructuring programs resulted in a reduction of over 350 employees, providing annual salary savings of approximately $22 million.

        In the year ended December 31, 2001, newsprint expenses increased $8.5 million, or 7.3%, from 2000 as a result of an increase in average newsprint prices of approximately 8.0%, year over year, which was offset somewhat by lower newsprint usage.

        Other operating expenses totaled $198.2 million for the year ended December 31, 2001, a decrease of $9.9 million, or 4.8%, compared to the year ended December 31, 2000. This significant decrease in costs can be explained partly by the change in our relationship with certain distribution agents, as discussed above, which resulted in a decrease in circulation expenses of approximately $6.3 million, as well as the implementation of stringent cost control measures.

EBITDA

        EBITDA for the year ended December 31, 2001 of $200.8 million was $4.5 million, or 2.2%, lower than EBITDA for the year ended December 31, 2000 of $205.3 million. The drop in revenues of $5.7 million (excluding the change in relationship with distribution agents) and the increase in newsprint costs of $8.5 million resulted in the decreased earnings. This decrease was partially offset by a decrease in wages and employee benefits expenses of $6.1 million, and the implementation of cost controls in other expense categories. Our EBITDA margin remained fairly constant at 24.0% for the year ended December 31, 2001, compared to 24.2% for the year ended December 31, 2000.

Restructuring Charges

        We implemented restructuring initiatives in the second and fourth quarters of the year ended December 31, 2001 in response to difficult market conditions. The initiatives resulted in a workforce reduction charge of $17.8 million in the year ended December 31, 2001, or $11.6 million net of taxes. Employee terminations were made across all of our geographic regions and departments, and included employees at all levels. The workforce reduction costs consisted primarily of severance, benefits and other personnel related costs. The restructuring initiatives resulted in a reduction of over 350 employees.

Depreciation and Amortization

        Depreciation and amortization expenses for the year ended December 31, 2001 were $47.3 million, an increase of $0.6 million compared to the expenses of $46.7 million for the year ended December 31, 2000.

Financial Expenses, Dividend Income and Income Taxes

        Financial expenses for the year ended December 31, 2001 were $42.1 million, compared to financial expenses of approximately $53.1 million for the year ended December 31, 2000. This decrease in financial expenses was the result of lower interest rates and lower total principal amount of outstanding debt. We made net debt repayments of $38.6 million during 2001.

        In the year ended December 31, 2001, we earned dividend income of $95.3 million on our investment in the Quebecor Media preferred shares. At December 31, 2001, we had a receivable of $95.3 million from Quebecor Media, representing the cumulative declared, but unpaid, dividend on the Quebecor Media preferred shares.

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        The provision for income taxes for the year ended December 31, 2001 was $35.6 million, compared to an expense of $42.3 million for the year ended December 31, 2000. The effective tax rate, excluding dividend income, decreased to 38.0% in the year ended December 31, 2001 from 40.1% in the year ended December 31, 2000, due to lower statutory tax rates and reduced non-deductible expenses.

Liquidity and Capital Resources

        Our principal liquidity and capital resource requirements consist of:

•

capital expenditures to augment and update our facilities;



•

service and repayment of our debt;



•

payment of dividends; and



•

purchase of the Quebecor Media preferred shares and service of the convertible obligations issued to Quebecor Media.

Capital Expenditures to Augment and Update Our Facilities

        During the year ended December 31, 2002, we spent $10.3 million to fund capital expenditures. We incurred approximately $2.5 million in the same period to acquire computer-to-plate technology for our printing facilities in Toronto, Edmonton and Calgary, and spent $2.1 million in the year ended December 31, 2001 acquiring similar technology for our facility in Montréal. The computer-to-plate equipment replaces film imagesetters and related computer systems, and contributes to improved operating results by providing a more efficient workflow, as well as higher quality newspapers. In the year ended December 31, 2002, we completed our press installation at The London Free Press, and the total cost of this project was approximately $13.6 million. The majority of this installation was paid for in prior years, with $9.1 million and $3.6 million having been spent in the years ended December 31, 2001 and 2000, respectively.

        We expect to spend approximately $3.2 million in 2003 and an additional $1.6 million over the next several years on augmenting the color capacity at our Montréal printing facility. The additional color capacity will enable us to pursue new sources of revenue, while improving the quality of Le Journal de Montréal. We are also committed to spending approximately $2.2 million in 2003 on computer-to-plate technology at our printing facilities in Québec City, Winnipeg and Ottawa. We do not anticipate our 2003 capital requirements to exceed approximately $20 million in aggregate.

Servicing and Repayment of Our Debt

        During the year ended December 31, 2002, we made cash interest payments of $33.7 million and made net repayments of our long-term debt of $37.2 million. In the year ended December 31, 2001, we made net repayments of our long-term debt of $38.6 million.

Payment of Dividends

        In the year ended December 31, 2002, we paid aggregate dividends of $70.9 million, or $56.26 per common share, to Quebecor Media in connection with its ownership of 1,261,000 common shares. Similarly, we paid aggregate dividends of $45.4 million, or $35.97 per common share, to Quebecor Media during the year ended December 31, 2001. No dividends were paid in the years ended December 31, 1999 and 2000. We expect, to the extent permitted by the terms of our indebtedness and applicable law, to continue to pay significant dividends to Quebecor Media in the future.

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Purchase of Shares of Quebecor Media and Service of Convertible Obligations

        Unlike corporations in the United States, corporations in Canada are not permitted to file consolidated tax returns. As a result, we have entered into some transactions that have the effect of consolidating tax losses within the Quebecor Media group.

        During the year ended December 31, 2001, we issued a $1.6 billion convertible obligation to Quebecor Media and used the proceeds to invest in $1.6 billion of the Quebecor Media preferred shares. The convertible obligation matures on July 14, 2007 and bears interest at 12.15% payable semi-annually. The Quebecor Media preferred shares are redeemable at the option of Quebecor Media and retractable at our option at the paid-up value. They carry a 12.5% annual fixed cumulative preferential dividend payable semi-annually.

        On November 28, 2002, we issued a new convertible obligation to Quebecor Media in the amount of $350.0 million. This new convertible obligation matures on November 28, 2008 and otherwise has terms and conditions substantially similar to the $1.6 billion convertible obligation issued in July 2001. We used the proceeds from the issuance of this new convertible obligation to invest in an additional $350.0 million of Quebecor Media preferred shares having terms and conditions substantially similar to those issued in 2001.

        During the year ended December 31, 2002, we made cash interest payments of $197.1 million with respect to the convertible obligations and received $202.7 million in preferred dividends with respect to our ownership of the Quebecor Media preferred shares. As of December 31, 2002, the outstanding balance on the convertible obligations was $2.04 billion, of which $93.1 million represented unpaid interest due on January 14, 2003.

        These issuances of the convertible obligations to Quebecor Media and the Quebecor Media preferred shares to us for the same principal amounts significantly reduce our income tax obligation. This is because the interest expense on the convertible obligations is deductible for income tax purposes, while the dividend income on the Quebecor Media preferred shares is not taxable. We obtained a ruling by the Canada Customs and Revenue Agency with respect to this arrangement.

        For financial reporting purposes under Canadian GAAP, the tax benefit of the interest on the convertible obligations is netted against the interest charged to retained earnings, and is not reflected in the provision for income taxes on the income statement. For this reason, for those periods during which this structure is in place, we anticipate our net cash taxes to be substantially lower than the provision for income taxes in our income statements prepared under Canadian GAAP.

Contractual Requirements and Other Commercial Commitments

        Contractual Obligations.    Our material obligations under firm contractual arrangements, including commitments for future payments under long-term debt arrangements, the convertible obligations and operating lease arrangements, as of December 31, 2002, are summarized below and are fully disclosed in notes 8, 9 and 13 to our audited consolidated financial statements.

	Payments Due By Period
Contractual Obligations:	Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 years
	(dollars in millions)
Convertible obligations	$	2,043.1	$	93.1	$	—	$	1,600.0	$	350.0
Long-term debt		515.1		60.0		240.5		214.6		—
Operating leases and other		33.4		11.2		11.2		4.4		6.6
Total contractual cash obligations	$	2,591.6	$	164.3	$	251.7	$	1,819.0	$	356.6

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        As of December 31, 2002, the outstanding balance on our old credit facility was $300.5 million. The outstanding principal amounts of US$97.5 million and US$53.5 million under each of the first and second series of our senior subordinated notes were due in February 2007 and May 2007, respectively. On February 7, 2003, we used the net proceeds from the offering of the old notes and the transactions described under "Summary—The Transactions" to, among other things, repay borrowings under our old credit facility and redeem our two series of senior subordinated notes. Concurrently with the sale of the old notes, we entered into a new credit facility consisting of a five-year revolving credit facility of $75.0 million and a six-year term loan B of US$230.0 million, and we used $349.0 million of borrowings under this new credit facility as described under "Use of Proceeds." See "Description of Certain Indebtedness—New Credit Facility." As a result, following the consummation of these transactions, substantially all of our long-term debt will mature after five years.

        As of December 31, 2002, the outstanding balance on the convertible obligations was $2.04 billion, of which $93.1 million represented unpaid interest due on January 14, 2003. The principal amount of $1.6 billion matures on July 14, 2007, and the principal amount of $350.0 million matures on November 28, 2008.

        We rent equipment and premises under various operating leases, and we have entered into long-term commitments to purchase services and capital. As of December 31, 2002, minimum payments under these leases and agreements over the next five years and thereafter were approximately $33.4 million in aggregate.

        We entered into a five-year management services agreement with Quebecor Media for services rendered on our behalf by Quebecor Media, including internal audit, legal and corporate, financial planning and treasury, tax, real estate, human resources, risk management, public relations and other services. This agreement provides for an annual management fee of $5.4 million in respect of 2003 and amounts to be agreed upon for the years 2004, 2005 and 2006.

        Other Commercial Commitments.    Our single most significant other commercial commitment is a long-term agreement, expiring December 31, 2005, with a newsprint manufacturer for the supply of most of our newsprint purchases. We are committed to purchase a minimum number of metric tonnes of newsprint per year under this agreement. This agreement provides for a discount to market prices above a minimum threshold. Because our commitment fluctuates with the market price of newsprint, we cannot estimate the actual dollar amount of our contractual commitment under this agreement.

        We are committed to spending approximately $2.2 million in 2003 on acquiring computer-to-plate technology for our printing facilities in Québec City, Winnipeg and Ottawa, in addition to approximately $3.2 million on additional color capacity in our Montréal printing facilities by 2004.

        In addition, our other commercial commitments include outstanding letters of credit totaling $0.3 million as of December 31, 2002.

Sources of Liquidity and Capital Resources

        Our primary sources of liquidity and capital resources are:

•

funds from operations;



•

financing from related party transactions;



•

debt from capital markets borrowings; and



•

bank financing.

        Funds from Operations.    Cash provided by operations in the year ended December 31, 2002 was $400.3 million, compared to $140.6 million for the year ended December 31, 2001. We received cash of $202.7 million during the year ended December 31, 2002 relating to dividend income from our

34

investment in Quebecor Media preferred shares. In the year ended December 31, 2001, no cash was collected by us in this regard. Excluding this amount, cash provided from operations increased $57.0 million, or 40.5%, in the year ended December 31, 2002, compared to the same period in 2001. This significant increase is partially due to the improvement in EBITDA of $21.5 million compared to last year, and restructuring charges which increased $15.6 million compared to 2001. We also experienced a favorable variance in cash taxes of $4.1 million compared to last year, mainly due to the tax benefit associated with the interest expense on our convertible obligations. Cash from operations also improved due to a reduction in cash interest payments as a result of lower debt levels and interest rates.

        Financing from Related Party Transactions.    In the year ended December 31, 2001, our most significant financing activity was the issuance to Quebecor Media of a $1.6 billion convertible obligation, which matures on July 14, 2007 and bears interest at 12.15% payable semi-annually. On November 28, 2002, we issued a new convertible obligation to Quebecor Media in the amount of $350.0 million. This new convertible obligation matures on November 28, 2008 and otherwise has terms and conditions substantially similar to the $1.6 billion convertible obligation issued in July 2001. The convertible obligations are redeemable at our option at any time at a redemption price equal to the then outstanding principal amount, plus any accrued and unpaid interest and, from and after May 15, 2007, Quebecor Media may, upon the occurrence of certain events, require us to redeem the convertible obligations at such price. We used the proceeds from the issuances of the convertible obligations to invest in $1.95 billion of the Quebecor Media preferred shares. The shares are redeemable at the option of Quebecor Media and retractable at our option at the paid-up value. They carry a 12.5% annual fixed cumulative preferential dividend payable semi-annually.

        During the year ended December 31, 2002, we made cash interest payments of $197.1 million with respect to these convertible obligations, and had cash dividend receipts of $202.7 million from our investment in the Quebecor Media preferred shares. As of December 31, 2002, the outstanding balance on these convertible obligations was $2.04 billion, of which $93.1 million represented unpaid interest due on January 14, 2003. As of December 31, 2002, we also had a receivable of $95.8 million from Quebecor Media, representing the cumulative declared, but unpaid, dividend on these shares.

        Interest Rate and Foreign Exchange Management.    We use certain financial instruments, such as interest rate swap and currency swap agreements, to manage our interest rate and foreign exchange exposure on debt instruments and on material purchases in foreign currency, such as press equipment. These instruments are not used for trading or speculative purposes. See "—Quantitative and Qualitative Disclosure about Market Risk."

Liquidity and Capital Resources Following the Offering of the Old Notes

        On February 7, 2003, we used a portion of the proceeds of the offering of the old notes, together with the proceeds of the transactions described in "Summary—The Transactions," to redeem our two series of then existing senior subordinated notes and refinance all outstanding borrowings under our old credit facility. Following the completion of these transactions, our principal sources of cash will be cash generated from operations and borrowings available under our new credit facility. As of December 31, 2002, as adjusted to give effect to the offering of the old notes and transactions described in "Summary—The Transactions," we would have had $75.0 million of available borrowing capacity under our new credit facility, $0.3 million of which we intend to use to replace outstanding letters of credit.

        We expect that our principal needs for cash relating to our existing operations over the next twelve months will be to fund operating activities and working capital, capital expenditures and debt service. We plan to fund these requirements from the sources of cash described above.

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        Based on current levels of operations and anticipated growth, we believe that our cash from operations, together with other available sources of liquidity, including borrowings under the new credit facility, will be sufficient for the foreseeable future to fund anticipated capital expenditures and make required payments of principal and interest on our debt, including payments due on the notes and obligations under our new credit facility. We expect, to the extent permitted by the terms of our indebtedness and applicable law, to continue to pay significant dividends to Quebecor Media in the future.

Summary of Critical Accounting Policies

        The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Consequently, actual results could differ from these estimates. We believe that the following are some of the more critical areas requiring the use of management estimates.

Long-lived Assets

        We review our property and equipment for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of property and equipment is measured by comparing the carrying amount of the assets to the projected discounted cash flows the assets are expected to generate. If these assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair market value.

        We also evaluate goodwill for impairment, on at least an annual basis and whenever events or circumstances indicate that the carrying amount may not be recoverable from its estimated future cash flows. Recoverability of goodwill is measured at the reporting unit level by comparing the reporting unit's carrying amount, including goodwill, to the fair value of the reporting unit, based on projected discounted future cash flows of the unit using a discount rate reflecting our average cost of funds. If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired, and a second test is performed to measure the amount of impairment loss. Some of our newspapers operate in highly competitive markets. Future adverse changes in market conditions or readership patterns in our newspapers could result in a material impairment charge of goodwill in the future.

        In our determination of the recoverability of property and equipment and goodwill, we based our estimates used in preparing the discounted cash flows on historical and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

Employee Future Benefits

        Pensions.    Pension costs are determined using actuarial methods and could be impacted significantly by our assumptions regarding future events, including expected return on plan assets and rate of compensation increases. The fluctuation of the discount rate at each measurement date also has an impact. Pension expense is charged to operations and includes:

•

the cost of pension benefits provided in exchange for employees' services rendered during the year;



•

the amortization of the initial net transition asset on a straight-line basis over the expected average remaining service life of the employee group covered by the plans;

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•

the amortization of prior service costs and amendments over the expected average remaining service life of the employee group covered by the plans; and



•

the interest cost of pension obligations, the return on pension fund assets, and the amortization of cumulative unrecognized net actuarial gains and losses in excess of 10.0% of the greater of the benefit obligation or fair value of plan assets over the expected average remaining service life of the employee group covered by the plans.

        Weighted average assumptions for the pension benefit plans in 2002 included a discount rate of 6.75%, an expected return on plan assets of 7.75% and compensation increases of 3.75%.

        Other Post-retirement Benefits.    We accrue the cost of post-retirement benefits other than pensions. These costs are impacted significantly by a number of management assumptions, which include the discount rate, the rate of compensation increase, and an annual rate of increase in the per capita cost of covered health care benefits. These benefits, which are funded by us as they become due, include life insurance programs and medical benefits. We amortize the cumulative unrecognized net actuarial gains and losses in excess of 10% of the projected benefit obligation over the expected average remaining service life of the employee group covered by the plans.

        Weighted average assumptions for other benefit plans in 2002 included a discount rate of 6.75% and a compensation increase of 3.75%.

        For measurement of the accumulated post-retirement benefit obligation, a 10.0% annual rate of increase in the per capita cost of covered health care benefits was assumed. The rate was assumed to decrease to 5.0% over ten years and remain at that level thereafter. An increase of 1.0% in the assumed health care cost trend would increase the current annual service costs by $0.1 million, interest costs by $0.2 million and benefit obligations by $3.7 million. A decrease of 1.0% in the assumed health care cost trend would decrease the current annual service costs by $0.1 million, interest costs by $0.1 million and benefit obligations by $2.8 million.

Quantitative and Qualitative Disclosure about Market Risk

        In the normal course of business, we are exposed to changes in interest rates. We manage this exposure by having a combination of fixed and variable rate obligations, and by periodically using financial instruments such as interest rate swap and cap agreements.

        We entered into a number of interest rate swap and cap agreements that matured in May 2002 to reduce our exposure to changes in interest rates on our old credit facility. These interest rate swap agreements had the effect of converting the interest on $100.0 million of our old credit facility from a floating rate plus the applicable margin under our old credit facility to a weighted average fixed interest rate of 5.4% plus the applicable margin under our old credit facility. These interest rate cap agreements had the effect of limiting the interest on $100.0 million of our old credit facility to a maximum of 5.3% plus the applicable margin under our old credit facility.

        In the year ended December 31, 2002, we were also exposed to changes in the exchange rate of the U.S. dollar as compared to the Canadian dollar because the majority of our revenue was received in Canadian dollars while the interest we paid on our then-existing senior subordinated notes was in U.S. dollars. To manage this exposure, we entered into a number of foreign exchange, fixed and variable interest rate, swap agreements for 100% of our then-existing senior subordinated notes. The effect of these agreements was to convert our obligations to service interest and principal payments on U.S. dollar-denominated debt of $151.0 million into Canadian dollar-denominated debt of $205.7 million at an average exchange rate of $1.3622 to US$1.00. In addition, these interest rate swap agreements had the effect of converting the interest rate on US$118.5 million of our then-existing senior subordinated notes from a fixed rate of 9.5% to a weighted average fixed interest rate on $161.4 million of 9.5%. These agreements also converted the interest rate on US$32.5 million of our

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then-existing senior subordinated notes from a fixed rate of 9.5% per annum to a floating interest rate of $44.3 million equal to the bankers' acceptance rate plus 2.9% per annum.

        In connection with the offering of the old notes and the repayment of our old credit facility and the redemption of our outstanding senior subordinated notes, we unwound these swap agreements and entered into new foreign exchange, fixed and variable interest rate, swap agreements for 100% of the notes and the U.S. dollar-denominated debt under our new credit facility. With respect to the notes, the effect of these agreements is to convert our obligations to service interest and principal payments on U.S. dollar-denominated debt of US$205.0 million into Canadian dollar-denominated debt of $312.2 million at an average exchange rate of $1.5227 to US$1.00, or $1.00 to US$0.6567. With respect to term loan B of our new credit facility, the effect of these agreements is to convert our obligations to service interest and principal payments on U.S. dollar-denominated debt of US$230.0 million into Canadian dollar-denominated debt of $349.0 million at an average exchange rate of $1.5175 to US$1.00, or $1.00 to US$0.6590. In addition, these interest rate swap agreements have the effect of converting the interest rate on US$155 million of our notes from a fixed rate of 7.625% to a fixed rate of 8.17% for the first five years that the notes are outstanding and to a floating interest rate equal to the bankers' acceptance rate plus 3.696% per annum for the last five years that the notes are outstanding. These agreements also have the effect of converting the interest rate on US$50 million of our notes from a fixed rate of 7.625% to a floating rate equal to the bankers' acceptance rate plus 3.696% per annum for the full ten-year period in which our notes may be outstanding. These agreements also have the effect of converting the interest rate on our term loan B of US$230.0 million under the new credit facility from a floating interest rate plus an applicable margin to a floating interest rate equal to the bankers' acceptance rate plus 2.905% for its full six-year term.

        Foreign currency fluctuations did not have a significant impact on our results for the years ended December 31, 2000, 2001 and 2002, as our operations in Florida did not represent a material portion of our consolidated operations for these periods.

        We do not hold or issue any derivative financial instruments for trading purposes. We are exposed to credit risk in the event of non-performance by counterparties in connection with our foreign currency contracts and interest rate swap and cap agreements. We do not obtain collateral or other security to support financial instruments subject to credit risk, but we mitigate this risk by dealing only with major Canadian and U.S. financial institutions and, accordingly, do not anticipate loss for non-performance.

        Concentrations of credit risk with respect to trade receivables are limited due to our diverse operations and large customer base. As of December 31, 2002, we had no significant concentrations of credit risk. We believe that the diversity of our products and customer base is instrumental in reducing our credit risk.

Canadian and United States Accounting Policy Differences

        We prepare our financial statements in accordance with Canadian GAAP. GAAP in the United States differs in certain respects from Canadian GAAP. The areas of material differences and their impact on our financial statements are described in note 18 to our audited consolidated financial statements included elsewhere in this prospectus. The significant differences include: (1) the accounting for the $1.95 billion of convertible obligations and (2) the accounting for derivative financial instruments.

        Under Canadian GAAP, the convertible obligations issued by us are considered to be part of shareholder's equity, and the interest expense on them, net of taxes, is charged to retained earnings. Under U.S. GAAP, these convertible obligations would be classified as long-term debt and the related interest expense on them would be recorded in our statements of income. As a result, under

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U.S. GAAP, our income for the years ended December 31, 2001 and 2002 decreased by $58.4 million and $128.4 million, respectively.

        Under Canadian GAAP, and U.S. GAAP prior to January 1, 2001, derivative financial instruments are accounted for on an accrual basis, with gains and losses being deferred and recognized in income in the same period and in the same financial category as the income or expense arising from the corresponding hedged position. We adopted Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended, effective January 1, 2001 for reporting under U.S. GAAP. As a result, under U.S. GAAP, derivative financial instruments are recorded at fair value and our income for the year ended December 31, 2001 decreased by $1.8 million (or $1.2 million after taxes), and our income for the year ended December 31, 2002 increased by $1.7 million (or $1.1 million after taxes).

Recent Accounting Pronouncements

Recent Canadian GAAP Accounting Pronouncements

        In December 2002, the Canadian Institute of Chartered Accountants issued section 3063, Impairment or Disposal of Long-Lived Assets, of the CICA Handbook and revised section 3475, Disposal of Long-Lived Assets and Discontinued Operations, of the CICA Handbook. Together, these two sections supersede the write-down and disposal provisions of section 3061, Property, Plant and Equipment, as well as section 3475, Discontinued Operations, of the CICA Handbook. Section 3063 amends existing guidance on long-lived asset impairment measurement and establishes standards for the recognition, measurement and disclosure of the impairment of long-lived assets held for use by us. It requires that an impairment loss be recognized when the carrying amount of an asset to be held and used exceeds the sum of the undiscounted cash flows expected from its use and disposal; the impairment recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. Section 3475 provides a single accounting model for long-lived assets to be disposed of by sale. Section 3475 provides specified criteria for classifying an asset as held-for-sale and requires assets classified as held-for-sale to be measured at the lower of their carrying amounts or fair value, less costs to sell. Section 3475 also broadens the scope of businesses that qualify for reporting as discontinued operations to include any disposals of a component of an entity, that comprises operations and cash flows that can be clearly distinguished from the rest of Sun Media, and changes the timing of recognizing losses on these operations. The new standards contained in section 3063 on the impairment of long-lived assets held for use are applicable for years beginning on or after April 1, 2003; however, early application is permitted. The revised standards contained in section 3475 on disposal of long-lived assets and discontinued operations are applicable to disposal activities initiated under an exit plan committed to on or after May 1, 2003; however, early application is permitted. We intend to adopt both of these standards as of January 1, 2003.

        In November 2001, the Canadian Institute of Chartered Accountants issued Accounting Guideline 13, Hedging Relationships, and in November 2002 the Canadian Institute of Chartered Accountants amended the effective date of this guideline. This accounting guideline establishes new criteria for hedge accounting and will apply to all hedging relationships in effect on or after January 1, 2004. On January 1, 2004, we will re-assess all hedging relationships to determine whether the criteria are met or not and will apply the new guidance on a prospective basis. To qualify for hedge accounting, the hedging relationship must be appropriately documented at the inception of the hedge and there must be reasonable assurance, both at the inception and throughout the term of the hedge, that the hedging relationship will be effective. Effectiveness requires a high correlation of changes in fair values or cash flows between the hedged item and the hedging item. Since the new Canadian criteria for hedge accounting are consistent with existing U.S. criteria for qualifying for hedge accounting, with which we comply, we do not anticipate any material impact from adopting this accounting guideline.

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Recent U.S. GAAP Accounting Pronouncements

        In June 2001, the Financial Accounting Standards Board issued FAS 143, Accounting for Asset Retirement Obligations, which addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. FAS 143 requires us to record the fair value of an asset retirement obligation as a liability in the period in which we incur a legal obligation associated with the retirement of tangible long-lived assets that result from the acquisition, construction, development and/or normal use of the assets. The fair value of the liability is added to the carrying amount of the associated asset, and this additional carrying amount is depreciated over the life of the asset. Subsequent to the initial measurement of the asset retirement obligation, the obligation will be adjusted at the end of each period to reflect the passage of time and changes in the estimated future cash flows underlying the obligation. If the obligation is settled for other than the carrying amount of the liability, we will recognize a gain or loss on settlement. We are required and plan to adopt the provisions of FAS 143 for the quarter ending March 31, 2003. To accomplish this, we must identify all legal obligations for asset retirement obligations, if any, and determine the fair value of these obligations on the date of adoption. The determination of fair value is complex and will require us to gather market information and develop cash flow models. Additionally, we will be required to develop processes to track and monitor these obligations. Because of the effort necessary to comply with the adoption of FAS 143, we are currently assessing the impact of the new standard.

        In April 2002, the Financial Accounting Standards Board issued FAS 145, which rescinded FAS 4, Reporting Gains and Losses from Extinguishment of Debt. FAS 145 addresses, among other things, the income statement treatment of gains and losses related to debt extinguishments, requiring that such expenses no longer be treated as extraordinary items, unless the items meet the definition of extraordinary in APB Opinion No. 30, Reporting the Results of Operations—Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions. Upon adoption, any gain or loss on extinguishment of debt that was classified as an extraordinary item in prior periods presented, that does not meet the criteria in APB Opinion No. 30 for classification as an extraordinary item, is required to be reclassified. The new presentation requirements must be adopted for fiscal years beginning after May 15, 2002, with early application encouraged. We will adopt the requirements of FAS 145 for U.S. GAAP purposes in the year ended December 31, 2003.

        In July 2002, the Financial Accounting Standards Board issued FAS 146, Accounting Costs Associated with Exit or Disposal Activities, which is effective for exit or disposal activities that are initiated after December 31, 2002. FAS 146 nullifies EITF No. 94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in Restructuring). The principal difference between FAS 146 and EITF 94-3 related to the recognition of a liability for a cost associated with an exit or disposal activity. FAS 146 requires that a liability be recognized for exit or disposal costs only when the liability is incurred, whereas under EITF 94-3 the liability was recognized when a company commits to an exit plan, and that the liability be initially measured at fair value. We are currently assessing the impact of the new standard.

        In November 2002, the Financial Accounting Standards Board issued FIN 45, Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others, which requires certain disclosures to be made by a guarantor in its interim and annual financial statements for periods ending after December 15, 2002 about its obligations under guarantees. FIN 45 also requires the recognition of a liability by a guarantor at the inception of certain guarantees entered into or modified after December 31, 2002. FIN 45 requires the guarantor to recognize a liability for the non-contingent component of certain guarantees; that is, it requires the recognition of a liability for the obligation to stand ready to perform in the event that specified triggering events or conditions occur. The initial measurement of this liability is the fair value of the guarantee at inception. We are currently assessing the impact of the new standard.

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BUSINESS

Overview

        We are the largest newspaper publisher in Québec and the second largest newspaper publisher in Canada, with a 21.0% market share in terms of weekly paid circulation, according to statistics published by the Canadian Newspaper Association. We publish 15 paid daily newspapers and serve eight of the top eleven urban markets in Canada. Each of our eight urban daily newspapers ranks either first or second in its market in terms of paid circulation. We also publish 175 weekly newspapers and shopping guides and 18 other specialty publications, including a free daily commuter newspaper. We publish the second and third largest non-national dailies in Canada based on weekly paid circulation: Le Journal de Montréal, with a paid circulation of 1.9 million copies, and The Toronto Sun, with a paid circulation of 1.5 million copies. The combined weekly paid circulation of our daily newspapers is approximately 6.8 million copies.

        In addition, we provide a range of commercial printing and other related services to third parties through our national network of production and printing facilities and distribute newspapers and magazines for other publishers across Canada.

        For the year ended December 31, 2002, we generated revenues of $853.6 million and EBITDA of $222.3 million. For this same period, 68.4% of our revenues were derived from advertising, 19.7% from circulation and 11.9% from commercial printing and distribution operations.

Our Strategy

        We aim to increase profitability and cash flow by pursuing the following business and operating strategies:

•

Increase advertising revenue.  We plan to continue to diversify our advertising offerings to attract advertisers, and further target national and multi-market accounts with large spending budgets. We continue to integrate our urban and community newspapers to offer advertisers packages bundled by market instead of by publication. In connection with this integration, we are establishing centralized classified advertisement call centers to expand existing advertising business, as well as solicit new business. We also continue to expand our sales force and provide it with training programs to enhance its effectiveness. We are upgrading our software to enable our advertisement takers to upsell and increase yield per advertisement. In addition, we plan to expand our use of value-based pricing and marketing strategies, such as charging premiums for preferred positions in our publications, to maximize advertising revenue.



•

Increase circulation revenue.  We plan to increase paid circulation of our newspapers by increasing the number of newspaper boxes and point-of-sale locations, as well as expanding home delivery service. We are further cultivating relationships with retail outlets to sell our newspapers. In addition, to increase readership, we continue to expand coverage of local news in our newspapers to differentiate their content from national publications and broaden their appeal and to target content for identified groups through the introduction of niche products, such as At Home magazine, Amateur Sports and Votre Argent. We also continue to invest in technology to enhance the effectiveness of our delivery and distribution operations.



•

Expand complementary products and services.  We plan to launch new products and services and capitalize on our existing assets to further increase our revenues. We will continue to leverage our newspaper brands by developing new specialty and niche products, such as targeted supplements, special interest pullouts and coupon books. We plan to continue to develop and roll out our new media services, which include complementary advertising vehicles, such as online classified and display advertisements, banner advertisements, virtual shopping malls and on-line auctions. In addition, by deploying additional sales and marketing resources, we intend to

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market more aggressively excess capacity in our existing printing facilities. We also plan to expand our distribution network, which currently has a potential reach of over nine million Canadian households, and more aggressively promote our distribution services to existing and new customers. We believe these initiatives will expand our revenue base, diversify our revenue streams and reduce our dependence on the advertising market.

•

Reduce costs.  We have expanded our implementation of "best practices" policies and benchmarking standards, including specific guidelines for staffing levels and employee productivity, throughout our operations. We also continue to seek lower cost alternatives for raw materials, equipment and services, and additional means to improve production efficiency, such as the reduction and standardization of paper sizes. In addition, we intend to control more rigorously the distribution of copies of our free newspapers by evaluating the needs of our advertising customers and improving the efficiency of our delivery operations. Finally, we seek to reduce costs and improve productivity by intensifying our employee training programs and investing in new technologies, such as computer-to-plate technology which streamlines the production process.



•

Achieve efficiencies through geographic clustering.  The majority of our community newspapers are geographically clustered around our eight urban dailies. We continue to concentrate our ownership of publications into regional clusters in order to realize operating efficiencies, such as the consolidation and sharing of production, printing and distribution functions, as well as management and administration costs. In addition, we believe that our clustering strategy enables us to maximize our production capacity and increase revenues by offering advertisers bundled packages encompassing some or all of our publications within a cluster.



•

Further integrate newspaper operations with the Quebecor Media group of companies.  We aim to increase circulation and readership and to attract advertisers by aggressively promoting our newspapers through Quebecor Media's television, cable affiliates and other media platforms, such as websites maintained for our newspapers by Quebecor Media's web-based affiliate, Netgraphe. We also aim to leverage our access to the content of these platforms by offering, among other things, enhanced coverage of their events and programming in our newspapers. In addition, we intend to offer advertisers comprehensive advertising packages across Quebecor Media's platforms to increase the number and average size of our advertising contracts.

Canadian Newspaper Publishing Industry Overview

        Newspaper publishing is the oldest and largest segment of the advertising-based media industry in Canada. The industry is dominated by a small number of major newspaper publishers, of which we are the second largest with a combined weekly circulation (paid and unpaid) of more than ten million copies.

        The newspaper market consists primarily of two segments, broadsheet and tabloid newspapers, which vary in format. With the exception of the broadsheet The London Free Press, all of our urban paid daily newspapers are tabloids.

        Newspaper companies derive revenue principally from advertising and circulation. According to industry sources, in 2001, the total Canadian daily newspaper industry revenue was $3.2 billion, with 79% derived from advertising and the remaining 21% coming from circulation. Total advertising revenue for the Canadian daily newspaper industry was $2.5 billion in 2001, which represented 23.7% of total Canadian advertising spending. Including revenues from non-daily newspapers, advertising revenues for the newspaper industry as a whole in 2001 were estimated to be approximately $3.3 billion, representing a 31% share of total Canadian advertising spending. From 1995 to 2000, advertising revenues for daily newspapers increased at an average annual rate of 6.3%. In 2001, as a

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result of a weakening economy and the events of September 11, daily newspaper advertising revenues declined by 3.1% compared to 2000. Zenith Media estimates that newspaper advertising revenues have remained flat in 2002. Total Canadian daily newspaper circulation revenue decreased by 1.5% to $682 million in 2001 despite a marginal increase in circulation volume.

        Circulation revenues are derived from single copy newspaper sales made through retailers and vending boxes and home delivery newspaper sales to subscribers.

        Advertising revenues and, to a lesser extent, circulation revenues are cyclical and are generally affected by changes in national and regional economic conditions. Recent statistics indicate that economic growth in Canada increased in 2002 relative to 2001. In addition, recent forecasts by the Bank of Canada project that Canadian Real Gross Domestic Product will grow at an average annual rate of 3.5% in 2002 and 2003. The improvement in the Canadian economy is expected to result in increased advertising expenditures. Zenith Media forecasts that newspaper advertising revenues in Canada will grow at a compound annual rate of 2.5% between 2002 and 2004.

Our Newspaper Operations

        We operate our newspaper businesses in urban and community markets. A majority of our newspapers in the Community Newspaper Group are clustered around our eight urban dailies in the Urban Daily Group. We have strategically established our community newspapers near our regional printing facilities in suburban and rural markets across Canada and in Florida. This geographic clustering enables us to realize operating efficiencies and economic synergies through sharing of management, accounting and human resources as well as production and printing functions.

The Urban Daily Group

        On a combined weekly basis, the eight paid daily newspapers in our Urban Daily Group circulate approximately 6.4 million copies. These newspapers hold either the number one or number two position in each of their respective markets in terms of circulation. In addition, on a combined basis, over 50% of our readers do not read our principal competitor's newspaper in each of our urban daily markets, according to data from the NADbank® 2002 Study.

        With the exception of the broadsheet The London Free Press, the paid daily newspapers are morning tabloids published seven days a week. These are mass circulation newspapers that provide succinct and complete news coverage with an emphasis on local news, sports and entertainment. The tabloid format makes extensive use of color, photographs and graphics. Each newspaper contains inserts that feature subjects of interest such as fashion, lifestyle and special sections. During 2002, the Urban Daily Group launched a quarterly publication with a circulation of 500,000 copies to be distributed to its subscribers across Canada. In 2002, the Urban Daily Group also launched a free weekly newspaper in London, and it currently publishes a free Monday to Friday commuter newspaper in Montréal and two free weekly shopping guides. In addition, the Urban Daily Group includes the distribution businesses operated through Messageries Dynamiques and Dynamic Press Group.

Our Newspapers

        Circulation is defined as average sales of a newspaper per issue. Readership (as opposed to paid circulation) is an estimate of the number of people who read or looked into an average issue of a newspaper and is measured by a continuous independent survey conducted by NADbank Inc. According to the NADbank® 2002 Study, the estimates of readership are based upon the number of people responding to the Newspaper Audience Databank survey circulated by NADbank Inc. who report having read or looked into one or more issues of a given newspaper during a given period equal to the publication interval of the newspaper.

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        The following chart lists our paid daily newspapers and their respective readership in 2002, as well as their market position by paid circulation during that period:

		2002 Average Readership
Newspaper					Market Position by Paid Circulation(1)
		Saturday	Sunday	Mon-Fri
Le Journal de Montréal		706,600	454,800	660,300	1
Le Journal de Québec		225,600	151,500	194,500	1
The Ottawa Sun		109,200	93,800	128,400	2
The Toronto Sun		699,300	1,018,900	896,900	2
The London Free Press		173,600	95,900	162,600	1
The Winnipeg Sun		116,300	121,200	138,400	2
The Edmonton Sun		160,000	193,900	183,800	2
The Calgary Sun		166,400	213,000	221,700	2
	Total Average Readership	2,357,000	2,343,000	2,586,600

(1)

Based on paid circulation data published by the Audit Bureau of Circulations with respect to non-national newspapers in each market.

        Le Journal de Montréal.Le Journal de Montréal is published seven days a week and is widely distributed by Messageries Dynamiques, which specializes in the distribution of publications. According to the Audit Bureau of Circulations, Le Journal de Montréal ranks second in paid circulation, after The Toronto Star, among non-national Canadian dailies and first among French-language dailies in North America. The average daily circulation of Le Journal de Montréal exceeds the circulation of each of its main competitors in Montréal, La Presse, The Gazette and Le Devoir, according to the Audit Bureau of Circulations.

        The following chart reflects the average daily circulation of Le Journal de Montréal for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
Le Journal de Montréal
Saturday	321,400	316,400	314,700
Sunday	275,000	267,800	264,800
Monday to Friday	259,600	260,900	262,800

        On March 12, 2001, we launched Montréal Métropolitain, a free daily newspaper with an average weekday circulation of 60,000 copies, according to internal statistics. The editorial content of Montréal Métropolitain concentrates on Montréal and Québec City news and competes with Metro, another free paper launched recently in Montréal.

        Le Journal de Québec.Le Journal de Québec is published seven days a week and is widely distributed by Messageries Dynamiques. Le Journal de Québec is the number one newspaper in its market. The average daily circulation of Le Journal de Québec exceeds the circulation of its main competitor, Le Soleil, according to the Audit Bureau of Circulations.

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        The following chart reflects the average daily paid circulation of Le Journal de Québec for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
Le Journal de Québec
Saturday	123,999	121,700	123,200
Sunday	99,225	98,600	100,700
Monday to Friday	96,127	96,200	98,500

        The Ottawa Sun.The Ottawa Sun is published seven days a week and is distributed throughout the Ottawa region through its own distribution network. The Ottawa Sun is the number two newspaper in its market, according to the Audit Bureau of Circulations, and competes daily with the English language broadsheet, The Ottawa Citizen, and also with the French language paper, Le Droit.

        The following chart reflects the average daily paid circulation of the Ottawa Sun for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
The Ottawa Sun
Saturday	45,800	45,200	41,000
Sunday	54,200	52,900	49,200
Monday to Friday	49,600	49,600	44,600

The Ottawa Sun also publishes the Ottawa Pennysaver, a free weekly community shopping guide with circulation of approximately 186,000.

        The Toronto Sun.The Toronto Sun is published seven days a week and has its own distribution network to serve the greater metropolitan Toronto area. The Toronto Sun is the third largest non-national daily newspaper in Canada in terms of circulation, according to the Audit Bureau of Circulations.

The Toronto Sun is unique in that Monday to Friday all circulation sales are from vending boxes and retail outlets. Home delivery is available on Sunday and in some designated areas on Saturday.

        The Toronto newspaper market is very competitive. The Toronto Sun competes with Canada's largest newspaper, The Toronto Star and to a lesser extent with The Globe & Mail and The National Post. As a tabloid newspaper, The Toronto Sun has a unique format compared to these broadsheet competitors. The competitiveness of the Toronto newspaper market is further increased by several free publications, including Metro Today, a free weekday commuter newspaper, and new niche publications relating to, for example, entertainment and television.

        The following chart reflects the average daily circulation of The Toronto Sun for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
The Toronto Sun
Saturday	173,000	169,700	169,300
Sunday	384,900	367,800	350,700
Monday to Friday	225,400	215,300	203,500

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        The London Free Press.The London Free Press, one of Canada's oldest daily newspapers, emphasizes national and local news, sports and entertainment and is distributed throughout the London area through its own network. It is the only local daily newspaper in its market.

        In 1998, we revised the editorial content of the paper to provide greater coverage of local and regional issues. In April 1998, The London Free Press began publishing its first Sunday edition and now publishes seven days a week. During 2002, The London Free Press also completed the installation of two used Goss Headliner offset presses to replace its letterpress technology. The installation of these presses significantly improved print quality and increased page, color and insert capacity of the newspaper.

        The following chart reflects the average daily circulation of The London Free Press for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
The London Free Press
Saturday	121,400	116,000	112,200
Sunday	64,800	62,700	61,700
Monday to Friday	97,800	93,900	90,800

        During 2002, The London Free Press launched London This Week, a free weekly community newspaper with a circulation of approximately 104,000 copies. The London Free Press also publishes the London Pennysaver, a free weekly community shopping guide with circulation of approximately 152,000.

        The Winnipeg Sun.The Winnipeg Sun is published seven days a week. It serves the metropolitan Winnipeg area and has its own distribution network. The Winnipeg Sun operates as the number two newspaper in the Winnipeg market according to the Audit Bureau of Circulations and competes with the Winnipeg Free Press.

        The following chart reflects the average daily circulation of The Winnipeg Sun for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
The Winnipeg Sun
Saturday	44,600	44,400	45,100
Sunday	58,800	58,100	56,400
Monday to Friday	45,700	45,900	45,400

        The Edmonton Sun.The Edmonton Sun is published seven days a week and is distributed throughout Edmonton through its own distribution network. The Edmonton Sun is the number two newspaper in its market, according to the Audit Bureau of Circulations, and competes with Edmonton's broadsheet daily, The Edmonton Journal.

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        The following chart reflects the average daily circulation of The Edmonton Sun for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
The Edmonton Sun
Saturday	74,100	72,700	71,600
Sunday	109,000	104,700	102,000
Monday to Friday	72,300	73,800	72,200

        The Calgary Sun.The Calgary Sun is published seven days a week and is distributed throughout Calgary through its own distribution network. The Calgary Sun is the number two newspaper in its market, according to the Audit Bureau of Circulations and competes with Calgary's broadsheet daily, The Calgary Herald.

        The following chart reflects the average daily circulation of The Calgary Sun for the periods indicated:

	Year Ended December 31,
	2000	2001	2002
The Calgary Sun
Saturday	69,300	67,200	65,100
Sunday	100,200	98,400	97,500
Monday to Friday	68,800	67,500	65,300

Advertising and Circulation

        Advertising revenue is the largest source of revenue for the Urban Daily Group. Advertising rates are based upon the size of the market in which each newspaper operates, circulation, readership, demographic composition of the market and the availability of alternative advertising media. Our strategy is to maximize advertising revenue by providing advertisers with a range of pricing and marketing alternatives to better enable them to reach their target audience. Our newspapers offer a variety of advertising alternatives, including full-run advertisements in regular sections of the newspaper targeted to different readers (including food, real estate and travel); geographically-targeted inserts; special-interest pullout sections and advertising supplements.

        Our principal categories of advertising revenues are classified, retail and national advertising. Classified advertising has traditionally accounted for the largest share of our advertising revenues in our urban daily newspapers (44.4% in the year ended December 31, 2002) followed by retail advertising (35.6% in the same period) and national advertising (17.5% in the same period). Classified advertising is made up of four principal sectors: automobiles, private party, recruitment and real estate. Automobile advertising is the largest classified advertising category, representing about 45.7% of all of our classified advertising in terms of revenue for the year ended December 31, 2002. Retail advertising is display advertising principally placed by local businesses and organizations. Our retail advertisers are principally department stores, electronics stores and furniture stores. National advertising is display advertising primarily from advertisers promoting products or services on a national basis. Our national advertisers are principally in the automotive sector. During 1999, we implemented an advertising initiative to maximize national and multi-market advertising sales by our publications. As a result of the initiative, our newspaper network has attracted major customers in several sectors of the Canadian economy, including the automobile, financial services, microcomputers and telecommunications industries.

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        We believe our advertising revenues are diversified not only by category (classified, retail and national), but also by customer and geography. For the year ended December 31, 2002, our top ten advertisers accounted for approximately 7% of the total advertising revenue and approximately 5% of overall revenue. In addition, because we sell advertising in numerous regional markets in Canada, the impact on us of a decline in any one market can be offset by strength in the others.

        Circulation sales are the second-largest source of revenue for the Urban Daily Group. The Urban Daily Group's newspapers are available through newspaper boxes and retail outlets Monday through Sunday. We offer daily home delivery in every market except Toronto, where The Toronto Sun is home-delivered only on Sunday and in certain designated areas on Saturday. We derive our circulation revenues from single copy sales and subscription sales. Our strategy is to increase circulation revenue by adding newspaper boxes and point-of-sale locations, as well as expanding home delivery. In addition, to increase readership, we are expanding coverage of local news in our newspapers and targeting editorial content to identified groups through the introduction of niche products, such as At Home magazine, Amateur Sports and Votre Argent.

Competition

        The Canadian newspaper industry is mature and dominated by a small number of major publishers. According to the Canadian Newspaper Association, our 21.0% market share of paid weekly newspaper circulation is exceeded only by CanWest Media Inc., with a 30.1% market share, and followed by Torstar Corporation (13.8%), Power Corporation (9.2%), Bell Globemedia (6.4%) and Osprey Media (4.7%). In addition to competing directly with other dailies published in their respective markets, each of our newspapers in the Urban Daily Group competes for advertising revenue with weekly newspapers, magazines, direct marketing, radio, television and other advertising media. Competition for newspaper advertising is largely based upon readership, circulation, demographic composition of the market, price and content of the newspaper. Competition for circulation is largely based on price, editorial content, quality of delivery service and availability of publications. The high cost associated with starting a major daily newspaper operation represents a barrier to entry to potential new competitors of our Urban Daily Group.

        Through Le Journal de Montréal and Le Journal de Québec, we have established market leading positions in Québec's two main urban markets, Montréal and Québec City. Le Journal de Montréal ranks second in circulation among non-national Canadian dailies and is first among French-language dailies in North America.

The London Free Press is one of Canada's oldest daily newspapers and our only daily broadsheet newspaper. The London Free Press is the only local daily newspaper in its market.

The Toronto Sun is the third-largest non-national daily newspaper in Canada in terms of circulation. The Toronto newspaper market is very competitive. The Toronto Sun competes with The Toronto Star and to a lesser extent with The Globe & Mail and The National Post. As a tabloid newspaper, The Toronto Sun offers readers and advertisers an alternative format to the broadsheet format of other newspapers in the Toronto market.

        Each of our dailies in Edmonton, Calgary, Winnipeg and Ottawa competes against a broadsheet newspaper and has established a number two position in its market.

The Community Newspaper Group

        In total, the Community Newspaper Group consists of seven daily community newspapers, 172 community weekly newspapers and shopping guides, and 16 farming and other specialty publications. We also own three additional community weekly newspapers and shopping guides and two specialty publications that are included in the Urban Daily Group. The Community Newspaper Group

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also distributes coupons, product samples and other direct mail promotional material through NetMedia, its distribution sales arm.

        The total average weekly circulation of the publications in our Community Newspaper Group for the year ended December 31, 2002 was approximately 3.0 million free copies and approximately 548,200 paid copies. The table below sets forth the average daily paid circulation and geographic location of the daily newspapers published by the Community Newspaper Group in 2002:

Newspaper		Location	Average Daily Paid Circulation
The Brockville Recorder and Times		Brockville, Ontario	13,100
Stratford Beacon Herald.		Stratford, Ontario	11,300
The Daily Herald Tribune.		Grande Prairie, Alberta	9,200
St. Thomas Time-Journal		St. Thomas, Ontario	8,400
Fort McMurray Today.		Fort McMurray, Alberta	7,100
The Daily Graphic.		Portage La Prairie, Manitoba	3,600
The Daily Miner & News		Kenora, Ontario	4,600
	Total Average Daily Paid Circulation.		57,300

        The weekly and specialty publications of the Community Newspaper Group are distributed throughout Canada and in Florida. The number of weekly publications on a regional basis is as follows:

Province or State		Number of Publications
Alberta		44
British Columbia		6
Florida		8
Manitoba		12
Ontario		39
New Brunswick		1
Québec		56
Saskatchewan		6
	Total Publications	172

        Our community newspaper publications generally offer news, sports and special features, with an emphasis on local information. These newspapers cultivate reader loyalty and create franchise value by emphasizing local news, thereby differentiating themselves from national newspapers. We also distribute coupons, flyers, product samples and other direct mail promotional material through NetMedia, the distribution sales arm of the Community Newspaper Group. Through its branch system and its associated distributors, NetMedia currently has the potential to provide advertising customers with distribution to over nine million Canadian households.

        We recently entered into a letter of intent for the sale of our Florida operations. The sale is subject to certain conditions, including satisfactory due diligence by the buyer. We expect to close the sale of our Florida operations in the first half of 2003.

Advertising and Circulation

        Substantially all of the Community Newspaper Group's advertising revenues are derived from local retailers and classified advertisers. Advertising rates and rate structures vary among the different publications of the Community Newspaper Group. The Community Newspaper Group publishes

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advertising supplements with specialized themes such as agriculture, tourism, home improvement and gardening to encourage advertisers to purchase additional linage in these special editions.

        Circulation revenue in the Community Newspaper Group is generated from home delivery sales and single copy sales through retailers and vending racks. When possible, we increase subscription and single copy sales rates in an effort to increase circulation revenue. The majority of the community newspaper publications is distributed free of charge through a controlled distribution system. This enables the publisher to better identify the clientele targeted by advertisers.

Competition

        A majority of the Community Newspaper Group's publications maintain the number one positions in the markets that they serve. Our community publications are generally located in small towns and are typically the only daily or weekly newspapers of general circulation published in their respective communities, although some face competition from daily or weekly publications published in nearby locations and circulated in markets where we publish our daily or weekly publications. Historically, the Community Newspaper Group's publications have been a consistent source of cash flow.

Other Operations

Commercial Printing and Distribution

        Our national network of production and printing facilities enables us to provide printing services for web press (coldset and heatset) and sheetfed products, and graphic design for print and electronic medium. Web presses utilize rolls of newsprint, whereas sheetfed presses use individual sheets of paper. Heatset web presses, which involve a more complex process than coldset web presses, are generally associated with printing on glossy paper. We own 27 web press and eleven sheet fed press operations located throughout Canada and in Florida. These operations provide commercial printing services for both our internal printing needs and for third parties. The Canadian printing facilities include 15 printing facilities for the daily publications and 17 other printing facilities operated by the Community Newspaper Group in six provinces. Our facility in Bradenton, Florida serves the Florida Sun publications.

        Our third-party commercial printing provides us with an additional revenue source while using existing equipment with excess capacity. In our third-party commercial printing operations, we compete with other newspaper publishing companies as well as with commercial printers. However, we have the advantage of: (1) owning modern equipment; (2) being able to price projects on a variable cost basis because our core newspaper business covers overhead expenses; and (3) being the only local provider of commercial printing service in some of our markets.

        The Urban Daily Group includes the distribution businesses of Messageries Dynamiques and Dynamic Press Group. Messageries Dynamiques distributes dailies, magazines and other electronic and print media and reaches approximately 250,000 households and 13,500 retail outlets through its operations in Québec. We hold Dynamic Press Group in partnership with a division of The Jim Pattison Group of Vancouver. Dynamic Press Group distributes English-language printed matter to more than 300 outlets in Québec.

        Similarly, the Community Newspaper Group operates the distribution business of NetMedia, which distributes coupons, flyers, product samples and other direct mail promotional material. Through its own branch system and its associated distributors, the Community Newspaper Group currently has the potential to provide advertising customers with distribution to over nine million Canadian households.

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Television News Station

        We own a 29.9% interest in Pulse 24. Pulse 24 operates CP 24, a regional, 24-hour local news channel in Canada offering viewers a variety of parallel and simultaneous continuous streams of information with an enriched visual screen. In addition to regular news, the enriched screen delivers attractive graphics and text which provide continuously updated information: date, time, weather forecasts, headlines, sports scores, stock market quotations and key indices. CP 24 is distributed via cable and satellite systems to homes across Ontario.

Seasonality and Cyclicality

        Canadian newspaper publishing company operating results tend to follow a recurring seasonal pattern with higher advertising revenue in the spring and in the fall. Accordingly, the second and fourth fiscal quarters are typically our strongest quarters, with the fourth quarter generally being the strongest. Due to the seasonal retail decline and generally poor weather, the first quarter has historically been our weakest quarter.

        Our newspaper business is cyclical in nature. Our operating results are sensitive to prevailing local, regional and national economic conditions because of our dependence on advertising sales for a substantial portion of our revenue.

Raw Materials

        Newsprint is our second-largest expense, after personnel costs, and represents our largest raw material expense. Newsprint expense represented 19.7% of our total operating expenses (before depreciation, amortization and restructuring charges) for the year ended December 31, 2001, and 16.4% for the year ended December 31, 2002. We seek to manage the effects of newsprint price increases through a combination of, among other things, technology improvements, including web width reduction, inventory management, incentive programs and, when possible, advertising and circulation price increases. In addition, to obtain more favorable pricing and to provide for a more secure supply, we have entered into a long-term agreement expiring December 31, 2005 with a newsprint manufacturer for the supply of most of our newsprint purchases. This agreement enables us to obtain more favorable pricing by combining our purchases with the Canadian purchases of Quebecor World Inc., the largest commercial printer and image management company in the world. This agreement provides for a discount to market prices above a minimum threshold. We are committed to purchase a minimum number of metric tonnes of newsprint per year under this agreement. This agreement will satisfy most of our anticipated newsprint requirements through the end of 2005.

        Aside from newsprint, the only raw materials of significance to us are ink and press plates, which together accounted for approximately 2.7% of the total operating expenses from our newspaper publishing operations in 2002.

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Property, Plants and Equipment

        The following table presents the addresses and sizes of the main facilities and other buildings of our eight urban dailies. No other single property exceeds 50,000 square feet. Details are provided regarding the square footage occupied by us, primary use of the property and current press capacity. Unless stated otherwise, we own all of the properties listed below.

Address	Use of Property	Press Capacity(1)	Floor Space Occupied
			(sq. ft.)
Toronto, Ontario 333 King Street East	Operations building, including printing plant—The Toronto Sun	4 Metro presses – 32 units 1 Metroliner press – 8 units	251,900
London, Ontario 369 York Street	Operations building, including printing plant—The London Free Press	2 Headliner presses – 12 units 1 Urbanite press – 8 units	150,100
Montréal, Québec 4545 Frontenac Street	Operations building, including printing plant—Le Journal de Montréal	3 Metro presses & 2 Cosmo presses – 30 units	162,000
Calgary, Alberta 2615-12 Street NE	Operations building, including printing plant—The Calgary Sun	1 Headliner press – 7 units	90,000
Vanier, Québec 450 Bechard Avenue	Operations building, including printing plant—Le Journal de Québec	2 Urbanite presses – 22 units	73,900
Winnipeg, Manitoba 1700 Church Avenue	Operations building, including printing plant—The Winnipeg Sun	1 Urbanite press – 10 units	63,400
Edmonton, Alberta 93000-47 Street	Printing plant—The Edmonton Sun	1 Metro press – 8 units	54,200
Edmonton, Alberta 4990-92 Avenue	Operations building (leased until December 2013)—The Edmonton Sun	n/a	45,200
Ottawa, Ontario 380 Hunt Club Road	Operations building (leased until October 2003)—The Ottawa Sun	n/a	22,000
Gloucester, Ontario 4080 Belgreen Drive	Printing plant— The Ottawa Sun	1 Urbanite press – 14 units	22,600

(1)

All presses described are manufactured by Goss Graphic Systems. A "unit" is the critical component of a press that determines color and page count capacity. All presses listed have between six and 14 units.

        During 2002, The London Free Press completed the installation of two used Goss Headliner offset presses to replace its letterpress technology. The installation of these presses significantly improved print quality and increased page, color and insert capacity of the newspaper. We also anticipate

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investing approximately $4.8 million over the next several years to increase the color capacity in Montréal.

        Our Community Newspaper Group, excluding our operations in Florida, operates from 137 owned and leased locations, with building space totaling approximately 807,000 square feet, located in the communities in which it serves.

The Florida Sun owns its head office and printing plant facility, located in Bradenton, Florida, and owns various branch offices totaling approximately 52,400 square feet.

        Our borrowings under the new credit facility will be secured by liens on all of our property and assets.

Regulation

        Federal or provincial law does not directly regulate the publication of newspapers in Canada. There are, however, indirect restrictions on the foreign ownership of Canadian newspapers by virtue of certain provisions of the Income Tax Act (Canada). The Income Tax Act (Canada) limits the deductibility by Canadian taxpayers of advertising expenditures that are made in a newspaper other than a "Canadian issue of a Canadian newspaper." For any given publication to qualify as a Canadian issue of a Canadian newspaper, the entity that publishes it, if publicly traded, must ultimately be controlled by Canadian citizens and, if a private company, must be at least 75.0% owned by Canadians. In addition, the publication must, with limited exceptions, be printed and published in Canada. All of our newspapers qualify as "Canadian issues of Canadian newspapers" and, as a result, our advertisers generally have the right to deduct their advertising expenditures with us for Canadian tax purposes.

Employees

        As of December 31, 2002, we employed approximately 5,678 employees (comprised of 4,516 full-time employees and 1,162 part-time employees expressed as full-time equivalents) in Canada and the United States. In addition, we employ the services of a number of freelancers from time to time.

        We are currently a party to 46 collective bargaining agreements. Seven of these collective bargaining agreements (representing approximately 229 employees) will expire on or before December 31, 2003. An additional 30 of these collective bargaining agreements (representing approximately 1,006 employees) will expire on or before December 31, 2006. Currently, there are nine collective bargaining agreements (representing approximately 361 employees) that have expired and are being negotiated for renewal.

        During 2002, the remaining non-unionized employees at The London Free Press voted to certify a union. We are currently negotiating a collective bargaining agreement with these approximately 300 employees, and we are hopeful that a collective bargaining agreement will be finalized in 2003.

        On January 27, 2003, approximately 160 employees in the editorial department of The Toronto Sun voted to certify a union. We expect to begin negotiating a collective bargaining agreement with these employees in 2003.

Intellectual Property

        We are a major provider of information and communications products to consumers and, as such, intellectual property rights, particularly copyrights and trademarks, are important in the sale and marketing of our products and services.

        We own copyrights in each of our publications as a whole and in all individual content items created by our employees in the course of their employment, subject to very limited exceptions. We

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have entered into licensing agreements with wire services, freelancers and other content suppliers on terms that we believe are sufficient to meet the needs of our publishing operations. We believe we have taken appropriate and reasonable measures to secure and maintain copyright protection of content produced by or distributed to us.

        While our businesses make extensive use of technology, we are not materially dependent on proprietary technology or third party intellectual property. It is our policy to take all reasonable steps to protect our intellectual property assets by agreement with third parties such as distributors, institutions and freelancers, or by registration.

Environment

        Our operations are subject to federal, provincial, state and local laws and regulations relating to the protection of the environment, including those governing the discharge of pollutants into the air and water, the management and disposal of hazardous materials, the recycling of wastes and the cleanup of contaminated sites. Laws and regulations relating to workplace safety and worker health, which, among other things, regulate employee exposure to hazardous substances in the workplace, also govern our operations.

        Compliance with these laws has not had, and management does not expect it to have, a material effect upon our capital expenditures, net income or competitive position. Environmental laws and regulations and their interpretation, however, have changed rapidly in recent years and may continue to do so in the future. Our properties, as well as areas surrounding our properties, may have had historic uses, including uses related to historic publishing operations, or may have current uses (in the case of surrounding properties) that may affect these properties and require further study or remedial measures. No material studies or remedial measures are currently anticipated or planned by us or required by regulatory authorities with respect to our properties. However, we cannot assure you that all environmental liabilities have been determined, that any prior owner of our properties did not create a material environmental condition not known to us, or that a material environmental condition does not otherwise exist as to any such property.

Legal Proceedings

        We are involved from time to time in various claims and lawsuits incidental to the conduct of our business in the ordinary course, including libel and defamation actions. We carry insurance coverage in such amounts we believe to be reasonable under the circumstances. We believe that an adverse outcome of legal proceedings in which we are currently involved will not have a material adverse impact on our financial position or operating results.

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MANAGEMENT

Directors and Executive Officers

        The following table presents some information concerning our directors and executive officers:

Name and Municipality of Residence	Age	Position
CLAUDE BERGERON Montréal, Québec	45	Director
PIERRE FRANCOEUR Ste-Adèle, Québec	50	Director and President and Chief Executive Officer; Publisher and Chief Executive Officer, Le Journal de Montréal
PIERRE KARL PÉLADEAU Montréal, Québec	41	Director and Chairman of the Board
THOMAS A. ROPER Vancouver, British Columbia	52	Director
WILLIAM R. DEMPSEY London, Ontario	59	Executive Advisor to the President and Chief Executive Officer
CHRISTOPHER R. KRYGIEL Mississauga, Ontario	44	Vice President, Human Resources
KIN-MAN LEE Richmond Hill, Ontario	39	Vice President, Corporate Controller
J. CRAIG MARTIN Sherwood Park, Alberta	47	Western Vice President; Publisher and Chief Executive Officer, The Edmonton Sun
JEFFREY S. NELSON Ottawa, Ontario	48	Vice President, Corporate Circulation
CHERYL A.M. PHILLIPS Toronto, Ontario	49	Vice President, Corporate Sales Development
LESTER C. PYETTE London, Ontario	57	Vice President, New Products
NOLIN RICHARD Richmond Hill, Ontario	43	Vice President, Corporate Production
LOUIS SAINT-ARNAUD Mont St-Hilaire, Québec	56	Vice President, Legal Affairs
CLAUDINE TREMBLAY Nun's Island, Québec	49	Corporate Secretary

Claude Bergeron, Director. Mr. Bergeron has been Vice President, Legal Affairs of Caisse de dépôt et placement du Québec since 1993. He began working at Caisse de dépôt et placement du Québec in 1988 as Senior Legal Counsel. Prior to his time at Caisse de dépôt, Mr. Bergeron served in the General Counsel department of the Québec Department of Revenue as an Assistant Director and Division Chief.

Pierre Francoeur, Director and President and Chief Executive Officer; Publisher and Chief Executive Officer, Le Journal de Montréal. Mr. Francoeur was appointed our President and Chief Executive Officer in April 2001, after serving as Executive Vice President and Chief Operating Officer for almost one year. He continues to serve as Publisher and Chief Executive Officer of Le Journal de Montréal. Mr. Francoeur first joined Le Journal de Montréal in 1979. In 1983, Mr. Francoeur left

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Le Journal de Montréal to found L'Hebdo de Laval, a weekly newspaper. In 1994, he returned to Le Journal de Montréal as Editor-in-Chief, and was appointed Publisher the following year. In April 1998, Mr. Francoeur was appointed Vice President, Dailies Division, Quebecor Communications Inc. Later that same year, he became President, Dailies Division, Quebecor Communications Inc. Mr. Francoeur is a member of the Board of the Canadian Press and the Canadian Newspaper Association.

Pierre Karl Péladeau, Director and Chairman of the Board. Mr. Péladeau is President and Chief Executive Officer of Quebecor and President and Chief Executive Officer of Quebecor Media. Mr. Péladeau joined Quebecor's communications division in 1985 as Vice President, Operations. In 1991, he was named President of Quebecor Group Inc. In 1995, Mr. Péladeau helped establish Quebecor Printing Europe and as its President, oversaw its growth through a series of acquisitions in France, the United Kingdom, Spain and Germany to become Europe's largest printer by 1997. In 1997, Mr. Péladeau became Executive Vice President and Chief Operating Officer of Quebecor Printing Inc. In 1999, Mr. Péladeau became President and Chief Executive Officer of Quebecor. Mr. Péladeau sits on the boards of numerous Quebecor companies and is active in many charitable and cultural organizations.

Thomas A. Roper, Q.C., Director. Mr. Roper practices law in the areas of labor, employment and administrative law. He is a past President and current member of the Human Resources Management Association of British Columbia, and is a member of the Canadian Association of University Solicitors and the Canadian Bar Association. Mr. Roper is the Managing Partner of the Vancouver office of Ogilvy Renault, a national law firm. Mr. Roper has been a partner of Ogilvy Renault since 1999, prior to which he was a partner of Alexander, Holburn, Beaudin & Lang.

William R. Dempsey, Executive Advisor to the President and Chief Executive Officer. Mr. Dempsey joined Bowes Publishers Ltd., one of our wholly owned subsidiaries, in 1966 and became its President and Chief Executive Officer in 1990. Mr. Dempsey was appointed Vice President of the Toronto Sun Publishing Corporation in 1992 and Executive Vice President of Sun Media in 2000. In 2002, Mr. Dempsey was appointed Executive Advisor to the President and Chief Executive Officer.

Christopher R. Krygiel, Vice President, Human Resources. Mr. Krygiel was appointed to the position of Vice President, Human Resources in 2001. He joined Sun Media in July 1998 as Corporate Director of Human Resources. Prior to that time, Mr. Krygiel had worked with Beaver Lumber Company for eleven years and rose to position of Director of Human Resources.

Kin-Man Lee, Vice President, Corporate Controller. Mr. Lee was appointed to his position in October 2001. Mr. Lee began his career with the Toronto Sun Publishing Corporation in August 1989 as the Assistant Corporate Controller. In 1993, he transferred to Bowes Publishers Ltd., one of our wholly owned subsidiaries. During his tenure at Bowes, Mr. Lee was appointed Corporate Controller in 1993, Director of Finance in 1998, Vice President, Finance in 2000 and Vice President, Finance and Administration in 2001.

J. Craig Martin, Western Vice President; Publisher and Chief Executive Officer, The Edmonton Sun. Mr. Martin became Publisher and Chief Executive Officer of The Edmonton Sun in 1994. In 1999, Mr. Martin was appointed our Vice President, Western Group, and in 2002, he was appointed Western Vice President. Mr. Martin joined the Toronto Sun Publishing Corporation in January 1984 as the Controller of The Calgary Sun. From 1988 to 1992, he was General Manager of The Calgary Sun. From 1992 to 1994, he was Associate Publisher of The Calgary Sun. He also serves as a director of the Edmonton Chamber of Commerce and the Science Alberta Foundation.

Jeffrey S. Nelson, Vice President, Corporate Circulation. Mr. Nelson began his newspaper career in 1977 with The Globe & Mail, where he held a variety of sales, service and distribution positions. In 1989, he was appointed Regional Circulation Director for Western Canada, and in 1991, he was

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appointed Regional Circulation Director with The Globe & Mail in Toronto. In 1994, he was appointed Vice President, Circulation Development with Thomson Newspapers for their Canadian group. After leaving Thomson Newspapers in 1996, Mr. Nelson became involved in a number of personal business initiatives, including the development and marketing of new client/server circulation software for the newspaper industry. He joined Sun Media in his current position in June 2002.

Cheryl A.M. Phillips, Vice President, Corporate Sales Development. Ms. Phillips began her newspaper career in the classified department at The Globe & Mail in 1976 and moved up to sales management positions. From there, she joined Metroland Printing, Publishing and Distributing. Immediately prior to joining us, Ms. Phillips was Director of Classified Development and Sales Training with Thomson Newspapers. Ms. Phillips joined us in 2000 as Director of Corporate Sales Development. She has been an active board member of the Newspaper Association of America's "NAA" Classified Foundation and Chair of the NAA's Classified Training Committee. Ms. Phillips has been a guest speaker at various CAA and NAA conferences.

Lester C. Pyette, Vice President, New Products. Mr. Pyette became Publisher and Chief Executive Officer of The Toronto Sun in April 2001, after serving as Publisher and Chief Executive Officer of The London Free Press since January 2000. In 2002, Mr. Pyette was appointed Vice President of our Eastern Ontario Group, and subsequently appointed Central Vice President. Mr. Pyette joined the Toronto Sun Publishing Company in 1974 as City Editor of The Toronto Sun. Since then, he has successively held the positions of Executive Editor of The Toronto Sun, Corporate Editor and Executive Assistant to the President and Chief Executive Officer of the Toronto Sun Publishing Company, General Manager of The Calgary Sun, and Publisher and Chief Executive Officer of The Calgary Sun. In November 2002, Mr. Pyette resigned from his position as Publisher and Chief Executive Officer of The Toronto Sun, and was appointed Vice President, New Products.

Nolin Richard, Vice President, Corporate Production. Mr. Richard was appointed to his current position in 2000. Mr. Richard began his career with Quebecor Printing in 1987 as Plant Engineer in Lasalle and in 1989, he was promoted to Plant Manager. In 1990, he was appointed Production Manager at Le Journal de Québec. In 1998, he was promoted to Vice President of Production and Information Services of Le Journal de Québec and in 1999, he became Vice President, Operations of The Toronto Sun.

Louis Saint-Arnaud, Vice President, Legal Affairs. Mr. Saint-Arnaud is Vice President, Legal Affairs and Corporate Secretary of Quebecor and Quebecor Media. Mr. Saint-Arnaud also served as General Manager for Québec-Livres, a division of Quebecor, from 1989 to 1990. He was Vice President, Legal Services and Secretary of Marine Industries Limited from 1980 to 1987. Mr. Saint-Arnaud was Director, Legal Services and Assistant Secretary of Société Générale de Financement du Québec from 1976 to 1980.

Claudine Tremblay, Corporate Secretary. Ms. Tremblay is currently Manager, Secretary's Office and Assistant Secretary of Quebecor Media. From August 1988 to 2001, Ms. Tremblay was Assistant Secretary at Quebecor Inc. Ms. Tremblay was Assistant Secretary and Administrative Assistant at the National Bank of Canada from 1980 to 1988.

Board of Directors

        Our board of directors has four directors. Each director is selected by Quebecor Media, our parent, to serve until a successor director is elected or appointed. We currently do not have committees of the board of directors; however, we intend to appoint a three-person audit committee, of which two members will be independent.

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Compensation of Directors and Executive Officers

        We did not pay any compensation for the year ended December 31, 2002 to our directors, as a group, who are named in the table under "—Directors and Executive Officers," for services in all capacities. All directors are reimbursed for reasonable out-of-pocket expenses incurred in connection with meetings of the board of directors.

        The aggregate amount of compensation we paid in the year ended December 31, 2002 to our executive officers, as a group, who are named in the table under "—Directors and Executive Officers," was $2.6 million, including salaries, bonuses and profit-sharing payments.

Quebecor Media's Stock Option Plan

        On January 29, 2002, Quebecor Media established a stock option plan to attract, retain and motivate directors, executive officers and key contributors to the success of Quebecor Media and its subsidiaries. The compensation committee of Quebecor Media is responsible for the administration of this stock option plan and, as such, will designate the participants under this stock option plan, determine the number of options granted, the vesting schedule, the expiry date and any other conditions relating to such options.

        All of the options granted under this stock option plan entitle their holders to acquire common shares of Quebecor Media. Each option may be exercised within a maximum period of ten years following the date of grant at an exercise price not lower than, as the case may be, the fair market value of the common shares as determined by the compensation committee (if the common shares of Quebecor Media are not listed at the time of the grant) or the trading price (as defined in this stock option plan) of the common shares on the stock exchanges where such shares are listed at the time of the grant. Unless authorized by the compensation committee for a change in control transaction, no option may be exercised by an optionee if the shares of Quebecor Media have not been listed on a recognized stock exchange. At December 31, 2007, if the shares of Quebecor Media have not been so listed, optionees will have until January 31, 2008 to exercise their vested options (the "Private Company Window"). At the time an optionee exercises his or her options, such optionee may request to receive in lieu of the underlying common shares a cash amount (a "Cash Exercise") representing the difference between the exercise price of the option and the fair market value or the trading price, as the case may be, of the underlying common shares at the time of exercise. For any Cash Exercises, and in particular for the anticipated multiple Cash Exercises if the Private Company Window is in effect, Quebecor Media may elect to pay all amounts owing in several installments if prudent considering its financial situation. Options not exercised prior to their expiration will be forfeited and may be re-issued pursuant to this stock option plan.

        Except under specific circumstances and unless the compensation committee decides otherwise, options vest over a five-year period in accordance with one of the following vesting schedules as determined by the compensation committee at the time of grant:

(1)

equally over five years with the first 20.0% vesting on the first anniversary of the date of the grant,



(2)

equally over four years with the first 25.0% vesting on the second anniversary of the date of the grant, and



(3)

equally over three years with the first 33.3% vesting on the third anniversary of the date of the grant.

        The maximum number of common shares of Quebecor Media that may be issued under this stock option plan is 433,000,000 common shares, and no optionee may hold options covering more than 5.0% of the outstanding shares of Quebecor Media.

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        During the year ended December 31, 2002, our executive officers were granted options to purchase common shares of Quebecor Media at a price determined by the compensation committee of Quebecor Media in accordance with the terms and conditions of this stock option plan.

Quebecor Inc.'s Stock Option Plan

        Quebecor Inc.'s stock option plan is designed to offer to officers, directors, senior employees and key employees of Quebecor Inc. or its subsidiaries the opportunity to benefit from the appreciation in value of the class B subordinate voting shares of Quebecor Inc. Under this stock option plan, options to purchase up to a maximum of 6,500,000 class B subordinate voting shares of Quebecor Inc. may be granted.

        Upon the recommendation of the compensation committee of Quebecor Inc., the board of directors of Quebecor Inc. designates from time to time the executives to whom options will be granted and the number of shares covered by each option. The options may not be exercised after the tenth anniversary date of granting. The number of options granted is based on individual merit and on the optionee's level of responsibility. No optionee may hold options covering more than 5.0% of the outstanding shares of Quebecor Inc.

        The exercise price of each class B subordinate voting share of Quebecor Inc. covered by an option granted pursuant to this stock option plan is equal to the weighted average trading price of those shares on The Toronto Stock Exchange over the five trading days immediately preceding the date of grant of this option.

        Options to purchase 15,000 class B subordinate voting shares of Quebecor Inc. were granted to one of our senior executive officers at an exercise price of $27.64 per share under the Quebecor Inc. stock option plan.

        The closing sale price of the class B subordinate voting shares of Quebecor Inc. on The Toronto Stock Exchange on December 31, 2002 was $14.09 per share.

Pension Benefits

        Quebecor Media maintains a pension plan for its non-unionized employees. This plan provides higher pension benefits to eligible executive officers than those provided to other employees. The higher pension benefits under this plan equal 2.0% of average salary over the best five consecutive years of salary (including bonuses), multiplied by the number of years of membership in the plan as an executive officer. The pension benefits so calculated are payable at the normal retirement age of 65 years, or sooner at the election of the executive officer, and from the age of 61 years without actuarial reduction. In addition, the pension benefits may be deferred, but not beyond the age limit under the provisions of the Income Tax Act (Canada), in which case the pension benefits are adjusted to take into account the delay in their payment in relation to the normal retirement age. The maximum pension benefits payable under such pension plans are as prescribed by the Income Tax Act (Canada). An executive officer contributes to this plan an amount equal to 5.0% of his or her salary not exceeding $86,111 (the salary generating the maximum pension payable in accordance with the Income Tax Act (Canada)), for a maximum contribution of $4,305 per year.

        The table below indicates the annual pension benefits that would be payable at the normal retirement age of 65 years:

		Years of Membership
Compensation		10		15		20		25		30
$	86,111 or more	$	17,222	$	25,833	$	34,444	$	43,056	$	51,667

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Supplemental Retirement Benefit Plan for Designated Executives

        In addition to the pension plan in force, Quebecor Inc. provides supplemental retirement benefits to certain designated executives. Four senior executive officers of Sun Media are participants under such plan.

        The supplemental pension is calculated as under the pension plan but without regard to the limitations of the Income Tax Act (Canada), and for three of the four senior executive officers with salary excluding bonuses, less the pension payable under the pension plan. The pension is payable for life without reduction from the age of 62. In case of death after retirement and from date of death, the plan provides for the payment of a joint and survivor pension to the eligible surviving spouse, representing 50.0% of the retiree's pension for a period of up to ten years.

        The table below indicates the annual supplemental pension that would be payable at the normal retirement age of 65 years:

		Years of Credited Service
Compensation		10		15		20		25		30
$	300,000	$	42,778	$	64,167	$	85,556	$	106,945	$	128,333
	400,000		62,778		94,167		125,556		156,945		188,333
	500,000		82,778		124,167		165,556		206,945		248,333
	600,000		102,778		154,167		205,556		256,945		308,333
	800,000		142,778		214,167		285,556		356,945		428,333
	1,000,000		182,778		274,167		365,556		456,945		548,333
	1,200,000		222,778		334,167		445,556		556,945		668,333
	1,400,000		262,778		394,167		525,556		656,945		788,333

        As of December 31, 2002, the four participating senior executive officers had credited service ranging from 2.5 years to 28.4 years.

Liability Insurance

        Quebecor Inc. carries liability insurance for the benefit of its directors and officers, and the directors and officers of its direct and indirect subsidiaries, including us, and certain associated companies, against certain liabilities incurred by them in such capacity.

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OUR SHAREHOLDER

        Our sole shareholder is 3535991 Canada Inc., a wholly owned subsidiary of Quebecor Media.

        Quebecor Media is a leading Canadian-based, multi-platform media company with interests in cable operations, our newspaper publishing operations, television broadcasting, book and magazine publishing, and new media services. Through these interests, Quebecor Media holds leading positions in the creation, promotion and distribution of news, entertainment and Internet related services that are designed to appeal to audiences in every demographic category. In addition, Quebecor Media is the largest French-language media company in North America and, through its various operations, reaches approximately 95% of the French-speaking and 41% of the English-speaking population in Canada every week.

        Quebecor Media was formed in August 2000 to facilitate the growth and integration of its established, complementary media assets. Through Vidéotron, Quebecor Media is the largest cable operator in Québec and the third largest in Canada based on number of basic cable subscribers. Through us, Quebecor Media is the largest newspaper publisher in Québec, the second largest newspaper publisher in Canada, and has established the number one or two market position in each of our eight urban daily markets in terms of weekly circulation. Through TVA, Quebecor Media is the largest private television broadcaster in Québec, the largest French-language television broadcaster in North America and the largest producer of French-language television programming in North America. In the new media sector, Quebecor Media has developed two of Canada's leading English and French-language Internet news and information portals and, through Nurun Inc., it provides Web integration and technology services. In addition, Quebecor Media is a leading book and magazine publisher and owns and operates the largest retail music and video store chains in Québec.

        Quebecor Media is 54.7% owned by Quebecor Inc. and 45.3% owned by Capital Communications CDPQ Inc. Quebecor Inc. is a communications holding company. Its primary assets are its interests in Quebecor Media and Quebecor World, the world's largest commercial printer and image management company. Capital Communications CDPQ Inc. is a wholly owned subsidiary of Caisse de dépôt et placement du Québec, Canada's largest pension fund with approximately $130 billion in assets. Capital Communications CDPQ Inc. specializes in financing for companies in the telecommunications, media and cultural industry sectors.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

        The following describes some transactions in which we and our directors, executive officers and affiliates are involved. We believe that each of the transactions described below was on terms no less favorable to us than could have been obtained from independent third parties.

Issuance of Convertible Obligations and Investment in Quebecor Media

        On July 9, 2001, we issued a $1.6 billion convertible obligation to Quebecor Media, and we used the proceeds to invest in $1.6 billion of the Quebecor Media preferred shares for tax planning purposes. In November 2002, we entered into similar transactions with Quebecor Media. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Purchase of Shares of Quebecor Media and Service of Convertible Obligations."

        The $1.6 billion convertible obligation issued to Quebecor Media matures on July 14, 2007, and bears interest at 12.15% payable semi-annually. In the year ended December 31, 2001, the interest on this convertible obligation charged to retained earnings amounted to $92.7 million, or $58.4 million after income taxes of $34.3 million. In the year ended December 31, 2002, the interest on these

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convertible obligations charged to retained earnings amounted to $197.5 million, or $128.4 million after income taxes of $69.0 million.

        We may elect to defer, at any time and from time to time, coupon payments on the $1.6 billion convertible obligation issued in July 2001 by extending the coupon payment period on the obligation for a period of up to 12 consecutive semi-annual periods, provided, however, that no extension period may extend beyond July 14, 2007. We may at any time, at our option, elect to satisfy our obligation to pay deferred semi-annual and the final coupon payment amounts by issuing and delivering to the holder, for each portion of one thousand dollars of coupon payment owed under this convertible obligation, the number of common shares of our capital stock valued at their fair value, determined by our board of directors. By giving notice to the holder at any time prior to July 14, 2007, we may elect to convert all or any part of the unpaid face amount and accrued and unpaid coupon payments into common shares, the number of which shares shall be determined by dividing the amount to be so converted by the fair value of one common share.

        On July 9, 2001, we invested in Quebecor Media preferred shares, at a cost of $1.6 billion, using the proceeds from the issuance of the convertible obligation. The shares are redeemable at the option of Quebecor Media or retractable at our option at the paid-up value, are non-voting, and carry a 12.5% annual fixed cumulative preferential dividend payable semi-annually. On November 28, 2002, we issued a new 12.15% convertible obligation to Quebecor Media in the principal amount of $350.0 million. This convertible obligation has substantially similar terms to that issued in July 2001 and matures on November 28, 2008. We used the proceeds to subscribe to an additional $350.0 million of the Quebecor Media preferred shares. At December 31, 2002, we had a receivable from Quebecor Media of $95.8 million, representing the cumulative declared, but unpaid, dividend on these shares. The full amount of the dividend was received on January 14, 2003.

Management and Other Services

        We have earned revenue for advertising and other services provided to, and incurred expenses for purchases and services obtained from, related companies at prices and conditions prevailing on the market as set out below. The majority of related party purchases were related to printing services provided by Quebecor World Inc., an affiliate of Quebecor Inc. Related party revenues were largely advertising sales to Vidéotron and Netgraphe Inc., affiliates of Quebecor Media.

        The following table presents the amounts of our revenues, accounts receivable, purchases and accounts payable from transactions with related parties during the periods indicated:

	Year Ended December 31,
	2000		2001		2002
	(dollars in thousands)
Revenues	$	5,427	$	12,265	$	9,551
Accounts receivable		556		5,473		1,756
Purchases		32,388		12,731		13,063
Accounts payable		548		4,567		4,994

        In 2002, we also began paying an annual management fee to Quebecor Media for services rendered on our behalf pursuant to a five-year management services agreement. These services include internal audit, legal and corporate, financial planning and treasury, tax, real estate, human resources, risk management, public relations and other services. This agreement provides for an annual management fee of $5.4 million in respect of 2003 and amounts to be agreed upon for the years 2004, 2005 and 2006. In addition, Quebecor Media is entitled to reimbursement for out-of-pocket expenses incurred in connection with the services provided under the agreement. In no event may the fees and reimbursements paid to Quebecor Media for any given year exceed 1.5% of our consolidated revenues

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for such year. For the year ended December 31, 2002, the management fee amounted to $5.1 million and is reflected in other operating expenses.

        As of December 31, 2002, the aggregate interest-free loan balances outstanding to senior management, for housing and other purposes, were $0.4 million. The aggregate sum of peak balances for these loans during the year was $0.5 million.

        In March 2002, we acquired for net cash proceeds of $756,000 from Quebecor Media the shares of Communications Gratte-Ciel ltée, which publishes two community weekly newspapers serving Montréal.

DESCRIPTION OF CERTAIN INDEBTEDNESS

New Credit Facility

        On February 7, 2003, we entered into a new secured credit facility consisting of a five-year revolving credit facility of $75.0 million and a six-year term loan B of US$230.0 million with Bank of America, N.A., Banc of America Securities LLC and Credit Suisse First Boston Corporation, as lead arrangers, Bank of America, N.A., as administrative agent, and various lending institutions. On February 7, 2003, we applied $349.0 million of borrowings under our new credit facility to the uses described under "Use of Proceeds."

        The following is a summary of the general terms and conditions of the new credit facility and is qualified in its entirety by reference to the documentation entered into or to be entered into in connection with the new credit facility. A copy of each of the credit agreement and the other documents into which we entered in connection with the new credit facility has been filed as an exhibit to the registration statement that includes this prospectus.

Security

        Borrowings under the new credit facility, as well as under eligible derivative instruments and letters of credit entered into in relation with the new credit facility and a pari passu overdraft facility, are secured by a first priority security interest on substantially all of our present and future assets and properties, including our accounts receivable, inventory, real property, machinery, equipment, contracts, and other assets. Substantially all of our subsidiaries guarantee our obligations under the new credit facility and provide similar security interests to the lenders under the new credit facility.

Interest Rate and Fees

        Advances by way of bankers' acceptances under the new revolving credit facility bear interest at the bankers' acceptance rate plus an applicable margin determined by our ratio of total debt to EBITDA. Advances by way of Canadian prime rate advances bear interest at the higher of the Canadian prime rate of Bank of America and the rate for 30-day Canadian dollar-denominated bankers' acceptances plus 1.0%, plus an applicable margin determined by our ratio of total debt to EBITDA. The applicable margin for advances bearing interest based on the bankers' acceptance rate ranges from 1.75% when the total debt to EBITDA ratio is lower then 2.75, 2.0% when this ratio is equal to or greater than 2.75 but lower than 3.25, and 2.25% when this ratio is equal to or greater than 3.25. The applicable margin for advances bearing interest based on the Canadian prime rate ranges from 0.75% when the total debt to EBITDA ratio is lower than 2.75, 1.0% when this ratio is equal to or greater than 2.75 but lower than 3.25, and 1.25% when this ratio is equal to or greater than 3.25. A commitment fee of 0.25% or 0.375% per annum is also payable on the undrawn portion of the new revolving credit facility depending on whether or not our total debt to EBITDA ratio exceeds 2.75.

        Advances under the new term loan B bear interest at LIBOR plus 2.5% or the U.S. Prime Rate (as defined under the new credit facility) plus a 1.50% margin.

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Principal Repayments and Prepayments

        The new term loan B is repayable on February 7, 2009. It is subject to amortization of 1.0% of the initial advance of principal per year, payable quarterly, during each of the first five years of the loan with the balance being fully repayable in 2009.

        The new revolving credit facility is repayable on February 7, 2008.

        In addition to our scheduled repayments, we are required under the new credit facility to prepay our debt under it with 100% of the net proceeds from the sale of assets by us and our subsidiaries subject to a de minimis basket, permitted transfers among us and certain of our subsidiaries and reinvestment exceptions. The net proceeds from the issuance of equity or subordinated debt (subject to certain exceptions) are also required to be applied in repayment of our debt under the new credit facility but only up to a maximum of 75% of these net proceeds. Prepayments are to be applied pro rata between the new revolving credit facility and the new term loan B, except for the net proceeds from the issuance of debt or equity, which will be applied to the repayment of the new term loan B in inverse order of maturity.

        We are not required to repay more than 25% of the amount under the new term loan B during the first five years and ten days following the date of the first advance under the new term loan B.

Covenants

        The new credit facility contains covenants customary for transactions of this nature, including covenants which require delivery of financial statements and other reports, compliance certificates and notices of default and material litigation, payment of taxes and compliance with applicable laws, and restrict the declaration and payment of dividends and other distributions, as well as other customary covenants of a financial nature.

Events of Default

        The new credit facility contains customary events of default including the non-payment of principal, interest, fees or other amounts, the making of any incorrect or misleading representation or warranty, the failure to perform or observe any other covenant, the default under other material agreements, the occurrence of a change of control of Sun Media or Quebecor Media, and certain bankruptcy and insolvency events.

2001 Convertible Obligation

        In July 2001, we issued a $1.6 billion convertible obligation to Quebecor Media. This convertible obligation matures on July 14, 2007 and bears interest at 12.15% payable semi-annually. This convertible obligation is classified as equity rather than debt under Canadian GAAP because we may elect to convert the unpaid principal amount and interest into our common shares at any time.

        We used the proceeds from the issuance of the convertible obligation to invest in the Quebecor Media preferred shares as part of certain transactions that have the effect of reducing our income tax obligation.

Ranking

        The convertible obligation is subordinated in right of payment to the prior payment in full of all our existing and future indebtedness. The holders of all our other indebtedness will be entitled to receive payment in full of all amounts due on or in respect of all such other indebtedness before the holder of the convertible obligation is entitled to receive payment of any kind.

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Convertibility

        We may, by giving notice to the holder at any time prior to the close of business on July 13, 2007, or the business day immediately preceding a redemption, as the case may be, elect to convert all or any part of the outstanding principal amount and accrued and unpaid coupons (including any deferred coupon) into fully paid and non-assessable common shares of our capital stock.

Coupon Payment Deferral Option

        We may defer, at any time and from time to time, the payment of any coupon on the convertible obligation for up to 12 consecutive semi-annual periods, provided, however, that any such deferral may not extend beyond July 14, 2007.

Share Payment Option

        We may, at any time, at our option, elect to pay any coupon (including any deferred coupon) by issuing and delivering to the holder of the convertible obligation fully-paid and non-assessable common shares of our capital stock.

Redemption

        The convertible obligation is redeemable at our option, in whole at any time, or in part from time to time, at a redemption price equal to the nominal amount of the obligation, together with accrued and unpaid coupons at the date of redemption. The convertible obligation is also redeemable at the option of the holder after May 15, 2007, provided no amounts are outstanding under our credit facilities and certain other conditions are met. We are obligated to redeem the convertible obligation upon the occurrence of certain bankruptcy and insolvency matters.

2002 Convertible Obligation

        We also issued, in November 2002, a $350.0 million convertible obligation to Quebecor Media which, except for its November 28, 2008 maturity date, was issued on terms and conditions substantially similar to those of the 2001 convertible obligation. The proceeds from the issuance of this 2002 convertible obligation were also used to optimize our tax structure by investing in additional Quebecor Media preferred shares.

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THE EXCHANGE OFFER

Purpose and Effect of the Exchange Offer

        On February 7, 2003, we sold the old notes in a private placement exempt from the registration requirements of the Securities Act to Salomon Smith Barney Inc, RBC Dominion Securities Corporation, TD Securities (USA) Inc., BMO Nesbitt Burns Corp., Credit Suisse First Boston Corporation, Scotia Capital (USA) Inc. and CIBC World Markets Corp., as initial purchasers. The initial purchasers then resold the old notes pursuant to an offering memorandum, dated January 30, 2003, in reliance upon Rule 144A and Regulation S under the Securities Act. On February 7, 2003, we and the subsidiary guarantors entered into a registration rights agreement with the initial purchasers. A copy of the registration rights agreement has been filed as an exhibit to the registration statement that includes this prospectus, and the summary of some of the provisions of the registration rights agreement under this section does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all the provisions of the registration rights agreement.

        Under the registration rights agreement, we agreed, among other things, to:

•

file an exchange offer registration statement with the SEC with respect to a registered offer to exchange without novation the old notes for the new notes no later than March 24, 2003;



•

use our best efforts to cause the exchange offer registration statement to be declared effective under the Securities Act no later than June 9, 2003; and



•

keep the registered exchange offer open for not less than 30 days and not more than 45 days (or, in each case, longer if required by applicable law) after the date notice of the registered exchange offer is mailed to the holders of the old notes.

        Under the registration rights agreement, we also agreed that in the event that:

•

applicable interpretations of law by the staff of the SEC do not permit us to effect the exchange offer;



•

the exchange offer is not consummated by July 7, 2003;



•

any initial purchaser requests with respect to old notes not eligible to be exchanged for new notes in the exchange offer; or



•

any holder of old notes (other than an initial purchaser) is not eligible to participate in the exchange offer or does not receive freely tradeable new notes in the exchange offer other than by reason of this holder being our affiliate (it being understood that that the requirement that a participating broker-dealer deliver this prospectus in connection with sales of the new notes shall not result in those new notes being not "freely tradeable"),

we will, at our cost, as promptly as practicable, file a shelf registration statement covering resales of the old notes or the new notes, use our best efforts to cause the shelf registration statement to be declared effective and use our best efforts to keep the shelf registration statement effective until two years after its effective date. In the event a shelf registration statement is filed, we will, among other things, provide to each holder for whom the shelf registration statement was filed copies of the prospectus that is a part of the shelf registration statement, notify each of these holders when the shelf registration statement has become effective and take certain other actions as are required to permit unrestricted resales of the old notes or the new notes.

        A holder selling old notes or new notes pursuant to a shelf registration statement would be required to be named as a selling security holder in the related prospectus and to deliver a prospectus to purchasers, will be subject to certain of the civil liability provisions under the Securities Act in

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connection with these sales and will be bound by the applicable provisions of the registration rights agreement (including certain indemnification obligations).

        Pursuant to the registration rights agreement, we will be required to pay special interest if a registration default exists. A registration default will exist if:

•

on or prior to March 24, 2003, neither the exchange offer registration statement nor the shelf registration statement has been filed with the SEC;



•

on or prior to June 9, 2003, neither the exchange offer registration statement nor the shelf registration statement has been declared effective;



•

on or prior to July 7, 2003, neither the registered exchange offer has been consummated nor the shelf registration statement has been declared effective; or



•

after either the exchange offer registration statement or the shelf registration statement has been declared effective, the exchange offer registration statement or the shelf registration statement ceases to be effective or usable (subject to certain exceptions) in connection with the resales of the old notes or the new notes in accordance with and during the periods specified in the registration rights agreement.

Special interest will accrue on the principal amount of the notes and the new notes (in addition to the stated interest on the notes and the new notes) from and including the date on which any of the registration defaults described above shall have occurred to but excluding the date on which all registration defaults have been cured. Special interest will accrue at a rate of 0.25% per annum during the 90-day period immediately following the occurrence of a registration default and shall increase by 0.25% per annum at the end of each subsequent 90-day period, but in no event shall this rate exceed 1.0% per annum.

        We are conducting the exchange offer to satisfy our obligations under the registration rights agreement. If you participate in the exchange offer, you will, with limited exceptions, receive new notes that are freely tradeable and not subject to restrictions on transfer. You should read the discussion under "—Resale of the New Notes" for more information regarding your ability to transfer the new notes.

        The exchange offer is not being made to, nor will we accept tenders for exchange from, holders of old notes in any jurisdiction in which the exchange offer or the acceptance of the exchange offer would not be in compliance with the securities laws or blue sky laws of such jurisdiction.

Terms of the Exchange Offer

        We are offering, upon the terms and subject to the conditions set forth in this prospectus and the accompanying letter of transmittal, to exchange up to US$205,000,000 aggregate principal amount of the new notes for a like aggregate principal amount of outstanding old notes. We will accept for exchange any and all old notes that are properly tendered on or prior to 5:00 p.m., New York City time, on                    , 2003, or such later time and date to which we extend the exchange offer. We will issue US$1,000 principal amount of the new notes in exchange for each US$1,000 principal amount of outstanding old notes accepted in the exchange offer. You may tender some or all of your old notes pursuant to the exchange offer; however, old notes may be tendered only in integral multiples of US$1,000 in principal amount.

        As of the date of this prospectus, US$205,000,000 in aggregate principal amount of the old notes were outstanding. This prospectus, together with the letter of transmittal, is being sent to all holders of the old notes known to us. Our obligation to accept old notes for exchange pursuant to the exchange offer is subject to certain conditions as set forth below under "—Conditions to the Exchange Offer."

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        The exchange agent will act as agent for the tendering holders for the purpose of receiving the new notes from us. If any tendered old notes are not accepted for exchange because of an invalid tender or otherwise, certificates for the unaccepted old notes will be returned, without expense, to the tendering holder as promptly as practicable after the expiration date.

        Holders of the old notes do not have appraisal or dissenters' rights under the laws of the State of New York or the indenture. We intend to conduct the exchange offer in accordance with the applicable requirements of the Securities Act and the Exchange Act and the rules and regulations under the Securities Act and the Exchange Act.

None of us, our board of directors and our management recommends that you tender or not tender your old notes in the exchange offer. In addition, no one has been authorized to make any such recommendation. You must make your own decision whether to participate in the exchange offer and, if you choose to participate, the aggregate principal amount of your old notes to tender, after carefully reading this prospectus and the letter of transmittal. We urge you to consult your financial and tax advisors in making your decision on what action to take.

Conditions to the Exchange Offer

        You must tender your old notes in accordance with the requirements of this prospectus and the letter of transmittal to participate in the exchange offer.

        Notwithstanding any other provision of the exchange offer, or any extension of the exchange offer, we are not required to accept for exchange any old notes, and we may terminate or amend the exchange offer, if we determine at any time prior to the expiration date that the exchange offer violates applicable law or any applicable interpretation by the staff of the SEC of applicable law.

        In addition, we will not be obligated to accept for exchange the old notes of any holder that has not made to us:

•

the representations described under "—Procedures for Tendering Old Notes—Representations Made by Tendering Holders of Old Notes" and "Plan of Distribution;" and



•

any other representations reasonably necessary under applicable SEC rules, regulations or interpretations to make available to us an appropriate form for registration of the new notes under the Securities Act.

        The foregoing conditions are for our sole benefit, and we may assert them regardless of the circumstances giving rise to any such condition, or we may waive the conditions, completely or partially, whenever or as many times as we may choose, in our sole discretion. Our failure at any time to exercise any of the above rights will not be a waiver of those rights, and each right will be deemed an ongoing right that may be asserted at any time. Any determination by us concerning the events described above will be final and binding upon all parties. If we determine that a waiver of conditions materially changes the exchange offer, this prospectus will be amended or supplemented, and the exchange offer extended, if appropriate, as described under "—Expiration Date; Extensions; Amendments."

        In addition, at any time when any stop order is threatened or in effect with respect to the registration statement that includes this prospectus or with respect to the qualification of the indenture under the Trust Indenture Act of 1939, we will not accept for exchange any old notes tendered, and no new notes will be issued in exchange for any such old notes.

Expiration Date; Extensions; Amendments

        The expiration date of the exchange offer will be 5:00 p.m., New York City time, on                    , 2003, unless we, in our sole discretion, extend the expiration date of the exchange offer. If we extend

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the expiration date of the exchange offer, the expiration date of the exchange offer will be the latest time and date to which the exchange offer is extended. We will notify the exchange agent by oral or written notice of any extension of the expiration date and make a public announcement of this extension no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date.

        In addition, we expressly reserve the right, at any time or from time to time, at our sole discretion:

•

to delay the acceptance of the old notes;



•

to extend the exchange offer;



•

if we determine any condition to the exchange offer has not occurred or has not been satisfied, to terminate the exchange offer; and



•

to waive any condition or amend the terms of the exchange offer in any manner.

        If the exchange offer is amended in a manner we deem material, we will as promptly as practicable distribute to the registered holders of the old notes a prospectus supplement that discloses the material change. If we take any of the actions described in the previous paragraph, we will as promptly as practicable give oral or written notice of this action to the exchange agent and will make a public announcement of this action.

        During any extension of the exchange offer, all old notes previously tendered will remain subject to the exchange offer and may be accepted for exchange by us. Any old notes not accepted for exchange for any reason will be returned without expense to the tendering holder as promptly as practicable after the expiration or termination of the exchange offer.

Procedures for Tendering Old Notes

Valid Tender

        The tender of a holder's old notes and our acceptance of those old notes will constitute a binding agreement between the tendering holder and us upon the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal. Except as set forth below, if you wish to tender old notes pursuant to the exchange offer, you must, on or prior to the expiration date:

•

transmit a properly completed and duly executed letter of transmittal, together with all other documents required by the letter of transmittal, to the exchange agent at one of the addresses set forth below under "—Exchange Agent;"



•

arrange with The Depository Trust Company, or DTC, to cause an agent's message to be transmitted with the required information (including a book-entry confirmation), to the exchange agent at one of the addresses set forth below under "—Exchange Agent;" or



•

comply with the guaranteed delivery procedures described below.

        In addition, on or prior to the expiration date:

•

the exchange agent must receive the certificates for the old notes, together with the properly completed and duly executed letter of transmittal;



•

the exchange agent must receive a timely confirmation of a book-entry transfer of the old notes being tendered into the exchange agent's account at DTC, together with the properly completed and duly executed letter of transmittal or an agent's message; or



•

the holder must comply with the guaranteed delivery procedures described below.

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        The letter of transmittal or agent's message may be delivered by mail, facsimile, hand delivery or overnight carrier to the exchange agent.

        The term "agent's message" means a message transmitted to the exchange agent by DTC that states that DTC has received an express acknowledgment from a tender holder that it agrees to be bound by the letter of transmittal and that we may enforce the letter of transmittal against this tendering holder. The agent's message forms a part of book-entry transfer.

        If you beneficially own old notes and those notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee or custodian, and you wish to tender your old notes in the exchange offer, you should contact the registered holder as soon as possible and instruct it to tender the old notes on your behalf and comply with the instructions set forth in this prospectus and the letter of transmittal.

        If you tender fewer than all of your old notes, you should fill in the amount of the old notes tendered in the appropriate box in the letter of transmittal. If you do not indicate the amount tendered in the appropriate box, we will assume you are tendering all old notes that you hold.

The method of delivery of the certificates for the old notes, the letter of transmittal and all other documents is at your sole election and risk. Instead of delivery by mail, it is recommended that you use an overnight or hand delivery service. If delivery is by mail, it is recommended that you use registered mail, properly insured, with return receipt requested. In all cases, sufficient time should be allowed to assure timely delivery. No letters of transmittal or old notes should be sent directly to us. Delivery is complete when the exchange agent actually receives the items to be delivered. Delivery of documents to DTC in accordance with DTC's procedures does not constitute delivery to the exchange agent.

Signature Guarantees

        Signatures on a letter of transmittal or a notice of withdrawal must be guaranteed unless the old notes surrendered for exchange are tendered:

•

by a registered holder of the old notes who has not completed the box entitled "Special Issuance Instructions" or "Special Delivery Instructions" on the letter of transmittal; or



•

for the account of an eligible institution.

An eligible institution is a firm or other entity that is a member of a registered national securities exchange or of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or correspondent in the United States or any other "eligible guarantor institution" as this term is defined in Rule 17Ad-15 under the Exchange Act.

        If a signature on a letter of transmittal or a notice of withdrawal is required to be guaranteed, this guarantee must be by an eligible institution.

        If the letter of transmittal is signed by a person other than the registered holder of the old notes, the old notes surrendered for exchange must be endorsed by, or be accompanied by a written instrument of transfer or exchange, in form satisfactory to us in our sole discretion, duly executed by, the registered holder, with the signature guaranteed by an eligible institution.

        If the letter of transmittal is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, this person should sign in that capacity when signing. In addition, this person must submit to us, together with the letter of transmittal, evidence satisfactory to us in our sole discretion of his or her authority to act in this capacity, unless we waive this requirement.

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Book-Entry Transfer

        For tenders by book-entry transfer of old notes cleared through DTC, the exchange agent will make a request to establish an account at DTC with respect to the old notes for purposes of the exchange offer. Any financial institution that is a DTC participant may make book-entry delivery of old notes by causing DTC to transfer the old notes into the exchange agent's account at DTC in accordance with DTC's procedures for transfer. The exchange agent and DTC have confirmed that any financial institution that is a participant in DTC may use the Automated Tender Offer Program procedures to tender old notes pursuant to the exchange offer. Accordingly, any DTC participant may make book-entry delivery of the old notes by causing DTC to transfer those old notes into the exchange agent's account in accordance with DTC's Automated Tender Offer Program procedures for transfer.

        Although delivery of the old notes pursuant to the exchange offer may be effected through book-entry transfer at DTC, you will not have validly tendered your old notes pursuant to the exchange offer until, on or prior to the expiration date, either:

•

the properly completed and duly executed letter of transmittal, or an agent's message, together with any required signature guarantees and any other required documents, has been transmitted to and received by the exchange agent at one of the addresses set forth below under "—Exchange Agent;" or



•

the guaranteed delivery procedures described below have been complied with.

Guaranteed Delivery Procedures

        If you wish to tender your old notes and:

•

your old notes are not immediately available;



•

time will not permit your old notes or other required documents to reach the exchange agent before the expiration date; or



•

you cannot complete the procedure for book-entry transfer on a timely basis,

you may tender your old notes according to the guaranteed delivery procedures described in the letter of transmittal. Those procedures require that:

•

tender be made by and through an eligible institution;



•

on or prior to the expiration date, the exchange agent receive from this eligible institution a properly completed and duly executed letter of transmittal, or an agent's message, with any required signature guarantees, and a properly completed and duly executed notice of guaranteed delivery, substantially in the form provided:



•

setting forth the name and address of the holder of the old notes being tendered;



•

stating that the tender is being made; and



•

guaranteeing that within three New York Stock Exchange trading days after the date of execution of the notice of guaranteed delivery, the certificates for all physically tendered old notes, in proper form for transfer, or a book-entry confirmation, and any other documents required by the letter of transmittal, will be deposited by the eligible institution with the exchange agent; and




•

the exchange agent receives the certificates for the old notes, in proper form for transfer, or a book-entry confirmation, and all other documents required by the letter of transmittal, are received by the Exchange Agent within three New York Stock Exchange trading days after the date of execution of the notice of guaranteed delivery.

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        If you wish to tender your old notes pursuant to the guaranteed delivery procedures, you must ensure that the exchange agent receives a properly completed and duly executed letter of transmittal, or agent's message, and notice of guaranteed delivery before the expiration date.

Determination of Validity of Tender

        We will resolve in our sole discretion all questions as to the validity, form, eligibility (including time of receipt) and acceptance of any old notes tendered for exchange. Our determination of these questions and our interpretation of the terms and conditions of the exchange offer, including without limitation the letter of transmittal and its instructions, shall be final and binding on all parties. A tender of old notes is invalid until all defects and irregularities have been cured or waived. Each holder must cure any and all defects or irregularities in connection with his, her or its tender of old notes within the reasonable period of time determined by us, unless we waive these defects or irregularities. None of us, our affiliates and assigns, the exchange agent and any other person is under any duty or obligation to give notice of any defect or irregularity with respect to any tender of the old notes, and none of them shall incur any liability for failure to give any such notice.

        We reserve the absolute right in our sole and absolute discretion to:

•

reject any and all tenders of old notes determined to be in improper form or unlawful;



•

waive any condition of the exchange offer; and



•

waive any condition, defect or irregularity in the tender of old notes by any holder, whether or not we waive similar conditions, defects or irregularities in the case of other holders.

Representations Made by Tendering Holders of Old Notes

        By tendering, you will represent to us that, among other things:

•

you are acquiring the new notes in the ordinary course of business;



•

you do not have any arrangement or understanding with any person or entity to participate in the distribution of the new notes;



•

if you are not a broker-dealer, you are not engaged in and do not intend to engage in a distribution of the new notes;



•

if you are a broker-dealer that will receive new notes for your own account in exchange for old notes that were acquired by you as a result of market-making activities or other trading activities, you will deliver a prospectus, as required by law, in connection with any resale of the new notes (see "Plan of Distribution"); and



•

you are not our "affiliate" as defined in Rule 405 of the Securities Act.

        If you are our "affiliate," as defined under Rule 405 of the Securities Act, or are engaged in or intend to engage in or have an arrangement or understanding with any person to participate in a distribution of the new notes, you will represent and warrant that you (i) may not rely on the applicable interpretations of the staff of the SEC and (ii) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act.

        In addition, in tendering old notes, you must warrant in the letter of transmittal or in an agent's message that:

•

you have full power and authority to tender, exchange, sell, assign and transfer old notes;

72

•

we will acquire good, marketable and unencumbered title to the tendered old notes, free and clear of all liens, restrictions, charges and other encumbrances; and



•

the old notes tendered for exchange are not subject to any adverse claims or proxies.

You must also warrant and agree that you will, upon request, execute and deliver any additional documents requested by us or the exchange agent to complete the exchange, sale, assignment and transfer of the old notes.

Acceptance of Old Notes; Delivery of New Notes

        Upon satisfaction or waiver of all of the conditions to the exchange offer, we will accept all old notes validly tendered, and not withdrawn, on or prior to the expiration date. We will issue the new notes to the exchange agent as promptly as practicable after acceptance of the old notes. See "—Terms of the Exchange Offer."

        For purposes of the exchange offer, we shall be deemed to have accepted validly tendered old notes for exchange when, as and if we have given oral or written notice of our acceptance to the exchange agent, with written confirmation of any oral notice to be given promptly thereafter.

Withdrawal Rights

        You may withdraw tenders of your old notes at any time prior to the expiration date.

        For a withdrawal to be effective, the exchange agent must receive a written notice of withdrawal from you. A notice of withdrawal must:

•

specify the name of the person tendering the old notes to be withdrawn;



•

identify the old notes to be withdrawn, including the total principal amount of these old notes; and



•

where certificates for the old notes have been transmitted, specify the name of the registered holder of the old notes, if different from the person withdrawing the tender of these old notes.

        If you delivered or otherwise identified certificates representing old notes to the exchange agent, then you must also submit the serial numbers of the particular certificates to be withdrawn and, unless you are an eligible institution, the signature on the notice of withdrawal must be guaranteed by an eligible institution. If you tendered old notes as a book-entry transfer, your notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn old notes and otherwise comply with the procedures of DTC. You may not withdraw or rescind any notice of withdrawal; however, old notes properly withdrawn may again be tendered at any time on or prior to the expiration date.

        We will determine, in our sole discretion, all questions as to the validity, form and eligibility (including time of receipt) of any and all notices of withdrawal, and our determination of these questions shall be final and binding on all parties. Any old notes properly withdrawn will be deemed not to have been validly tendered for exchange for purposes of the exchange offer and will be returned to the holder without cost as soon as practicable after their withdrawal.

Exchange Agent

        National City Bank is the exchange agent for the exchange offer. You should direct all tendered old notes, executed letters of transmittal and other related documents to the exchange agent. You should direct all questions and requests for assistance, requests for additional copies of this prospectus

73

or of the letter of transmittal and requests for notices of guaranteed delivery to the exchange agent at the following addresses and telephone numbers:

By Mail: National City Bank P.O. Box 92301 LOC #5352 Cleveland, Ohio 44193-0900	By Hand Delivery or Overnight Courier: National City Bank Corporate Trust Operations 4100 West 150th Street, 3rd Floor LOC #5352 Cleveland, Ohio 44135-1385 or	By Facsimile Transmission: (216) 222-9326 For Information or Confirmation by Telephone: (216) 222-2552
	National City Bank The Depository Trust Company Transfer Agent Drop Services 55 Water Street Jeanette Park Entrance New York, New York 10041

If you deliver executed letters of transmittal and any other required documents to an address or facsimile number other than those set forth above, your tender is invalid.

Fees and Expenses

        We will bear the expenses of soliciting old notes for exchange. The principal solicitation is being made by mail by the exchange agent. Additional solicitations may be made by facsimile, telephone or in person by officers and regular employees of our company and our affiliates.

        We have not retained any dealer-manager in connection with the exchange offer and will not make any payments to any broker, dealer, nominee or other person, other than the exchange agent, for soliciting tenders of the old notes pursuant to the exchange offer. We will pay the exchange agent reasonable and customary fees for its services and reimburse it for its related reasonable out-of-pocket expenses.

        We will pay the cash expenses to be incurred in connection with the exchange offer. They include:

•

registration and filing fees;



•

fees and expenses of the exchange agent and trustee;



•

accounting and legal fees and printing costs; and



•

related fees and expenses.

Transfer Taxes

        We will pay all transfer taxes, if any, applicable to the exchange of the old notes under the exchange offer. A tendering holder, however, will be required to pay any applicable transfer taxes if:

•

this tendering holder instructs us to register new notes in the name of, or deliver new notes to, a person other than the registered tendering holder of the old notes;



•

the tendered old notes are registered in the name of a person other than the person signing the applicable letter of transmittal; or



•

a transfer tax is imposed for any reason other than the exchange of old notes under the exchange offer.

74

If satisfactory evidence of payment of any transfer taxes payable by a tendering holder is not submitted with the letter of transmittal, the amount of the transfer taxes will be billed directly to that tendering holder.

Accounting Treatment

        The new notes will be recorded at the same carrying value, in U.S. dollars, as the old notes, and will be translated into Canadian dollars in accordance with Canadian GAAP, as reflected in our accounting records on the date of the exchange. Accordingly, we will recognize no gain or loss for accounting purposes upon the closing of the exchange offer. We will amortize the expenses of the exchange offer over the term of the new notes under Canadian GAAP.

Consequences of Failure to Exchange Old Notes

        Following the consummation of the exchange offer, we will have fulfilled most of our obligations under the registration rights agreement. Unless you are an initial purchaser or a holder of old notes who is not eligible to participate in the exchange offer or does not receive freely tradeable new notes pursuant to the exchange offer, if you do not tender your old notes in the exchange offer or if we do not accept your old notes because you did not tender them properly, you will not have any further registration rights with respect to your old notes, and you will not have the right to receive any special interest on your old notes. In addition, your old notes will continue to be subject to restrictions on their transfer. In general, any old note that is not exchanged for a new note may not be offered or sold, unless registered under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws.

        We may in the future seek to acquire unexchanged old notes in open market or privately negotiated transactions, through subsequent exchange offers or otherwise. We have no present plans, however, to acquire any unexchanged old notes or to file with the SEC a shelf registration statement to permit resales of any unexchanged old notes.

Resale of the New Notes

        Based on interpretations by the SEC staff set forth in no-action letters issued to third parties in similar transactions, such as Exxon Capital Holding Corporation and Morgan Stanley & Co. Incorporated, we believe that a holder of the new notes may offer the new notes for resale or resell or otherwise transfer the new notes without compliance with the registration and prospectus delivery requirements of the Securities Act, unless this holder:

•

is our "affiliate" within the meaning of Rule 405 under the Securities Act;



•

is a broker-dealer who purchased old notes directly from us for resale under Rule 144A or any other available exemption under the Securities Act;



•

acquired the new notes other than in the ordinary course of this holder's business; or



•

is participating, intends to participate or has an arrangement or understanding with any person to participate in the distribution of the new notes.

Accordingly, holders wishing to participate in the exchange offer must make the applicable representations described in "—Procedures for Tendering Old Notes—Representations Made by Tendering Holders of Old Notes" above.

        Although we are making the exchange offer in reliance on the interpretations by the SEC staff set forth in these no-action letters, we do not intend to seek our own no-action letter from the SEC. Consequently, we cannot assure you that the SEC staff would make a similar determination with respect to the exchange offer as it did in its no-action letters to third parties. If this interpretation is

75

inapplicable and you resell or otherwise transfer any new notes without complying with the registration and prospectus delivery requirements of the Securities Act, you may incur liability under the Securities Act. We do not assume or indemnify you against this liability.

        You may not rely on the interpretations of the SEC staff in the above-described no-action letters if you are a holder of old notes who:

•

is our "affiliate" as defined in Rule 405 under the Securities Act;



•

does not acquire the new notes in the ordinary course of business;



•

tenders in the exchange offer with the intention to participate, or for the purpose of participating, in a distribution of the new notes; or



•

is a broker-dealer that purchased old notes from us to resell them pursuant to Rule 144A under the Securities Act or any other available exemption under the Securities Act, and

in the absence of an exemption, you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale or other transfer of the new notes.

        In addition, each broker-dealer that receives new notes for its own account in exchange for old notes that were acquired by it as a result of market-making activities or other trading activities must acknowledge that it will deliver a prospectus in connection with any resale of those new notes. See "Plan of Distribution." Under the registration rights agreement, we will be required to use our best efforts to keep the registration statement that includes this prospectus effective to allow these participating broker-dealers and other persons, if any, with similar prospectus delivery requirements to use this prospectus in connection with the resale of the new notes for the period that ends on the sooner of 180 days after the consummation of the exchange offer and the date on which all participating broker-dealers have sold all the new notes held by them.

        In order to comply with state securities laws, the new notes may not be offered or sold in any state unless they have been registered or qualified for sale in such state or an exemption from registration or qualification is available and is complied with.

        The new notes are not being offered for sale and may not be offered or sold, directly or indirectly, in Canada, or to any resident thereof, except in accordance with the securities laws of the provinces and territories of Canada. We are not required, and do not intend, to qualify by prospectus in Canada the new notes, and accordingly, the new notes will remain subject to restrictions on resale in Canada.

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DESCRIPTION OF THE NOTES

        You can find the definitions of certain terms used in this description under the subheading "—Definitions." In this description, the words "Sun Media" and "we" refer only to Sun Media Corporation and not to any of its subsidiaries.

        We issued the old notes, and will issue the new notes, as a single series of securities under an indenture dated as of February 7, 2003, among Sun Media, the Subsidiary Guarantors and National City Bank, as trustee. The indenture is governed by the Trust Indenture Act of 1939. The terms of the notes include those stated in the indenture and those made part of the indenture by reference to the Trust Indenture Act. The form and terms of the new notes will be substantially identical to the form and terms of the old notes, except that:

•

the new notes will be registered under the Securities Act and, consequently, will be freely tradeable by persons not affiliated with us;



•

the new notes will not bear any legend restricting transfer under the Securities Act;



•

the new notes are not entitled to the rights which are applicable to the old notes under the registration rights agreement; and



•

our obligation to pay additional special interest on the old notes if (a) the exchange offer registration statement that includes this prospectus is not declared effective by June 9, 2003 or (b) the exchange offer is not consummated by July 7, 2003, in each case, at incremental rates ranging from 0.25% per annum to 1.0% per annum depending on how long we fail to comply with these deadlines, does not apply to the new notes.

        The new notes will be issued solely in exchange for an equal principal amount of the old notes. As of the date of this prospectus, US$205.0 million aggregate principal amount of the old notes is outstanding.

        The following description is a summary of the material provisions of the indenture. It does not restate the indenture in its entirety. We urge you to read the indenture because it, and not this description, defines your rights as a holder of the notes. A copy of the indenture is available upon request to Sun Media at the address indicated under "—Additional Information." In addition, a copy of the indenture has been filed as an exhibit to the registration statement that includes this prospectus.

        The registered holder of a note will be treated as the owner of the note for all purposes. Only registered holders will have rights under the indenture. In this description, the term "holder" refers only to registered holders of the notes.

Principal, Maturity and Interest

        On February 7, 2003, we issued US$205.0 million aggregate principal amount of old notes and will issue up to US$205.0 million aggregate principal amount of the new notes in the exchange offer. Subject to compliance with the limitations described under "—Covenants—Incurrence of Indebtedness and Issuance of Preferred Shares," we may issue an unlimited principal amount of additional notes at later dates under the same indenture ("Additional Notes"). We can issue the Additional Notes as part of the same series or as an additional series. Any Additional Notes that we issue in the future will be identical in all respects to the notes, except that Additional Notes issued in the future will have different issuance prices and issuance dates. We issued old notes, and will issue new notes, only in fully registered form without coupons, in denominations of US$1,000 and integral multiples of US$1,000. The notes will mature on February 15, 2013.

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        Interest on the notes will accrue at the rate of 7⁵/8% per annum and will be payable semi-annually in arrears on February 15 and August 15, commencing on August 15, 2003. Sun Media will make each interest payment to the holders of record on the immediately preceding February 1 and August 1.

        Interest on the notes will accrue from February 7, 2003 or, if interest has already been paid, from the date it was most recently paid. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.

        The interest rate on the notes will increase if a registration default occurs. We refer to any interest payable as a result of this increase in interest rate as "special interest." You should refer to the description under the heading "The Exchange Offer" for a more detailed description of the circumstances under which the interest rate will increase.

Ranking

        The old notes are, and the new notes will be:

•

senior unsecured obligations of Sun Media;



•

effectively junior in right of payment to all of our and the Subsidiary Guarantors' existing and future secured indebtedness, including any borrowings under our New Credit Facility, to the extent of the value of the assets securing that indebtedness;



•

effectively junior in right of payment to all indebtedness and other obligations (including trade payables) of any of our subsidiaries that do not guarantee the notes;



•

equal in right of payment to all of our and the Subsidiary Guarantors' existing and future unsubordinated, unsecured indebtedness that does not expressly provide that it is subordinated to the notes or Subsidiary Guarantees, as applicable;



•

senior in right of payment to all of our and the Subsidiary Guarantors' existing and future indebtedness that expressly provides that it is subordinated to the notes or Subsidiary Guarantees, as applicable; and



•

guaranteed on a senior unsecured basis by the Subsidiary Guarantors, which will consist of all of our Restricted Subsidiaries that guarantee any other Indebtedness.

        As of December 31, 2002, after giving effect to the offering of the old notes, the transactions described under "Summary—The Transactions" and the application of the net proceeds from these transactions, Sun Media would have had $661.2 million in principal amount of senior indebtedness and no subordinated indebtedness (other than Existing Back-to-Back Debt), and the Subsidiary Guarantors would have had no indebtedness other than intercompany indebtedness and the obligations under the Subsidiary Guarantees.

        The notes are obligations exclusively of Sun Media. A portion of the operations of Sun Media is conducted through subsidiaries. Therefore, Sun Media's ability to service its debt, including the notes, will partially depend on the earnings of its subsidiaries and, to the extent they are not Subsidiary Guarantors, their ability to distribute those earnings as dividends, loans or other payments to Sun Media. If their ability to make these distributions were restricted, by law or otherwise, then Sun Media would not be able to use the cash flow of its subsidiaries to make payments on the notes. Furthermore, under certain circumstances, bankruptcy "fraudulent conveyance" or "fraudulent preference" laws or other similar laws could invalidate the Subsidiary Guarantees. If this were to occur, Sun Media would also be unable to use the assets of the Subsidiary Guarantors to the extent they were restricted from distributing funds to Sun Media. Any of the situations described above could make it more difficult for Sun Media to service its indebtedness.

78

        Sun Media principally relies on its shareholder's claim on the assets of its subsidiaries. This shareholder's claim is junior to the claims that creditors (including trade creditors) of Sun Media's subsidiaries have against those subsidiaries. Holders of the notes will be creditors only of Sun Media and those of its subsidiaries that are Subsidiary Guarantors. In the case of subsidiaries that are not Subsidiary Guarantors, all the existing and future liabilities of such subsidiaries, including any claims of trade creditors and preferred shareholders, will be effectively senior to the notes. The liabilities, including contingent liabilities, of Sun Media's subsidiaries that are not Subsidiary Guarantors may be significant.

        Although the indenture will contain limitations on the amount of additional indebtedness that Sun Media and the Restricted Subsidiaries may incur, the amounts of such additional indebtedness could nevertheless be substantial and may be incurred either by Sun Media, the Subsidiary Guarantors or by any other subsidiaries of Sun Media. See "—Covenants—Incurrence of Indebtedness and Issuance of Preferred Shares."

        The notes are unsecured obligations of Sun Media, and the Subsidiary Guarantees are unsecured obligations of the Subsidiary Guarantors. Secured indebtedness of Sun Media and the Subsidiary Guarantors, including under the New Credit Facility and any guarantees of the New Credit Facility, effectively will be senior to the notes to the extent of the value of the assets securing such indebtedness. As of December 31, 2002, after giving effect to this offering, the transactions described under "Summary—The Transactions" and the application of the net proceeds from these transactions, the total outstanding secured indebtedness of Sun Media and the Subsidiary Guarantors, combined, would have been approximately $349.0 million (excluding unused commitments).

Subsidiary Guarantees

        The obligations of Sun Media under the notes and the indenture, including the repurchase obligation resulting from a Change of Control, will be fully and unconditionally guaranteed, jointly and severally, on a senior, unsecured basis, by each Subsidiary Guarantor, which will include each existing and future Restricted Subsidiary of Sun Media that guarantees any other Indebtedness (including any Back-to-Back Debt or the Existing Back-to-Back Debt) of Sun Media or any of its Subsidiaries. Initially, all of Sun Media's Subsidiaries will be Subsidiary Guarantors, except for Courrier du Sud Inc.

        If (a) Sun Media sells or otherwise disposes of either:

(1)

its entire ownership interest in a Subsidiary Guarantor, or



(2)

all or substantially all the assets of a Subsidiary Guarantor, or

        (b) a Subsidiary Guarantor sells or otherwise disposes of either:

(1)

its entire ownership interest in a Subsidiary Guarantor, or



(2)

all or substantially all the assets of a Subsidiary Guarantor,

in each case to a Person that is not a Subsidiary of Sun Media, then in any such case, the Subsidiary Guarantor being sold or whose property is being sold will be released from all of its obligations under its Subsidiary Guarantee, subject to compliance with all applicable covenants of the indenture, including the covenant described under "—Repurchase at the Option of Holders—Asset Sales." In addition, if Sun Media designates a Subsidiary Guarantor as an Unrestricted Subsidiary, which Sun Media can do under certain circumstances, the designated Subsidiary Guarantor will be released from all of its obligations under its Subsidiary Guarantee. See "—Covenants—Designation of Restricted and Unrestricted Subsidiaries" and "—Merger, Consolidation or Sale of Assets." Upon being released from all other guarantee obligations, Subsidiary Guarantors may be released from their obligations under the Subsidiary Guarantees.

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        If any Subsidiary Guarantor makes payments under its Subsidiary Guarantee, each of Sun Media and the other Subsidiary Guarantors must contribute its share of these payments. Sun Media's and the other Subsidiary Guarantors' shares of these payments will equal the proportion that the net worth of Sun Media or the relevant Subsidiary Guarantor represents relative to the aggregate net worth of Sun Media and all the Subsidiary Guarantors combined.

Methods of Receiving Payments on the Notes

        If a holder has given wire transfer instructions to Sun Media, Sun Media will pay all principal, interest and premium and special interest, if any, on that holder's notes in accordance with those instructions. All other payments on the notes will be made at the office or agency of the paying agent and registrar for the notes within the City and State of New York unless Sun Media elects to make interest payments by check mailed to the holders at their addresses set forth in the register of holders.

Paying Agent and Registrar for the Notes

        The trustee will initially act as paying agent and registrar under the indenture. Sun Media may change the paying agent or registrar without prior notice to any holder, and Sun Media or any of its Subsidiaries may act as paying agent or registrar.

Transfer and Exchange

        A holder may transfer or exchange its notes in accordance with the indenture. In connection with any transfer or exchange of the notes, the registrar and the trustee may require a holder, among other things, to furnish appropriate endorsements and transfer documents, and Sun Media may require a holder to pay any taxes and fees required by law or permitted by the indenture. Sun Media is not required to register the transfer of or to exchange any note selected for redemption. Also, Sun Media is not required to transfer or exchange any note for a period of 15 days before a selection of notes to be redeemed.

Optional Redemption

        At any time prior to February 15, 2006, Sun Media may on any one or more occasions redeem up to 35% of the aggregate principal amount of the notes issued under the indenture at a redemption price of 107.625% of the principal amount of the notes redeemed, plus accrued and unpaid interest thereon and special interest, if any, to the redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date), with the net cash proceeds of one or more Equity Offerings; provided, however, that:

(1)

at least 65% of the aggregate principal amount of notes issued under the indenture remain outstanding immediately after the occurrence of such redemption, excluding notes held by Sun Media and its Subsidiaries; and



(2)

the redemption occurs within 90 days of the date of the closing of any such Equity Offering.

        Except as set forth above or under "Redemption for Changes in Withholding Taxes," the notes will not be redeemable at Sun Media's option prior to February 15, 2008. Starting on that date, Sun Media may redeem all or a part of the notes, at once or over time, upon not less than 30 nor more than 60 days' notice, at the redemption prices, expressed as percentages of principal amount, set forth below, plus accrued and unpaid interest and special interest, if any, thereon, to the applicable redemption date (subject to the right of holders of record on the relevant record date to receive interest due on the

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relevant interest payment date), if redeemed during the twelve-month period beginning on February 15 of the years indicated below:

Year	Percentage
2008	103.813	%
2009	102.542	%
2010	101.271	%
2011 and thereafter	100.000	%

Redemption for Changes in Withholding Taxes

        If Sun Media becomes obligated to pay any Additional Amounts because of a change in the laws or regulations of Canada or any Canadian Taxing Authority, or a change in any official position regarding the application or interpretation thereof, in either case that is publicly announced or becomes effective on or after the Issue Date, Sun Media may, at any time, redeem all, but not part, of the notes at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest and special interest, if any, to the redemption date, provided that at any time that the aggregate principal amount of the notes outstanding is greater than US$20.0 million, any holder of the notes may, to the extent that it does not adversely affect Sun Media's after-tax position, at its option, waive Sun Media's compliance with the covenant described under the caption "—Payment of Additional Amounts," provided, further, that if any holder waives this compliance, Sun Media may not redeem that holder's notes pursuant to this paragraph.

Payment of Additional Amounts

        All payments made by or on behalf of Sun Media on or with respect to the notes will be made without withholding or deduction for any Taxes imposed by any Canadian Taxing Authority, unless required by law or the interpretation or administration of this law by the relevant Taxing Authority. If Sun Media or any other payor is required to withhold or deduct any amount on account of Taxes from any payment made under or with respect to any notes that are outstanding on the date of the required payment, Sun Media will:

(1)

make this withholding or deduction;



(2)

remit the full amount deducted or withheld to the relevant government authority in accordance with applicable law;



(3)

pay the additional amounts, which we refer to as "Additional Amounts," as may be necessary so that the net amount received by each holder (including Additional Amounts) after this withholding or deduction will not be less than the amount the holder would have received if these Taxes had not been withheld or deducted;



(4)

furnish to the holders, within 30 days after the date the payment of any Taxes is due, certified copies of tax receipts evidencing this payment by Sun Media;



(5)

indemnify and hold harmless each holder (other than an Excluded Holder, as defined below) for the amount of (a) any Taxes paid by this holder as a result of payments made on or with respect to the notes, (b) any liability (including penalties, interest and expenses) arising from or with respect to these payments and (c) any Taxes imposed with respect to any reimbursement under (a) or (b), but excluding any of these Taxes that are in the nature of taxes on net income, taxes on capital, franchise taxes, net worth taxes and similar taxes; and



(6)

at least 30 days prior to each date on which any payment under or with respect to the notes is due and payable, if Sun Media becomes obligated to pay Additional Amounts with respect to this payment, deliver to the trustee an officers' certificate stating the amounts so payable and such other information necessary to enable the trustee to pay these Additional Amounts to holders on the payment date.

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        Notwithstanding the foregoing, no Additional Amounts will be payable to a holder in respect of beneficial ownership of a Note (an "Excluded Holder"):

(1)

with which Sun Media does not deal at arm's-length, within the meaning of the Income Tax Act (Canada), at the time of making such payment;



(2)

which is subject to such Taxes by reason of its being connected with Canada or any province or territory thereof otherwise than by the mere acquisition, holding or disposition of notes or the receipt of payments thereunder; or



(3)

if such holder waives its right to receive Additional Amounts.

        Any reference, in any context in the indenture, to the payment of principal, premium, if any, redemption price, Change of Control Payment, offer price and interest, special interest or any other amount payable under or with respect to any note, shall be deemed to include mention of the payment of Additional Amounts to the extent that, in such context, Additional Amounts are, were or would be payable.

Mandatory Redemption

        Except as described below under the caption "Repurchase at the Option of Holders," Sun Media is not required to make mandatory redemption or sinking fund payments with respect to the notes.

Repurchase at the Option of Holders

Change of Control

        Within 30 days following any Change of Control, Sun Media will mail a notice to the trustee and each holder describing the transaction or transactions that constitute the Change of Control and offering to repurchase notes on the Change of Control Payment Date specified in the notice, pursuant to the procedures required by the indenture and described in the notice. If a Change of Control occurs, each holder of notes will have the right to require Sun Media to repurchase all or any part, equal to US$1,000 or an integral multiple of US$1,000, of that holder's notes pursuant to a Change of Control Offer on the terms in the indenture. In the Change of Control Offer, Sun Media will offer a Change of Control Payment in cash equal to 101% of the aggregate principal amount of notes repurchased, plus accrued and unpaid interest and special interest, if any, on the notes repurchased, to the date of purchase. The Change of Control Payment Date shall be no earlier than 30 days and no later than 60 days from the date the notice is mailed. Sun Media will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the notes as a result of a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control provisions of the indenture, Sun Media will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control provisions of the indenture by virtue of this conflict.

        On the Change of Control Payment Date, Sun Media will, to the extent lawful:

(1)

accept for payment all notes or portions of notes properly tendered pursuant to the Change of Control Offer;



(2)

deposit with the paying agent an amount equal to the Change of Control Payment in respect of all notes or portions of notes properly tendered; and



(3)

deliver or cause to be delivered to the trustee the notes so accepted together with an officers' certificate stating the aggregate principal amount of notes or portions of notes being purchased by Sun Media.

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        The paying agent will promptly mail to each holder of notes properly tendered the Change of Control Payment for these notes, and Sun Media will execute and issue, and the trustee will promptly authenticate and mail, or cause to be transferred by book-entry, to each holder a new note equal in principal amount to any unpurchased portion of the notes surrendered, if any; provided, however, that each such new note will be in a principal amount of US$1,000 or an integral multiple of US$1,000.

        The provisions described above that require Sun Media to make a Change of Control Offer following a Change of Control will be applicable regardless of whether any other provisions of the indenture are applicable. Except as described above with respect to a Change of Control, the indenture does not contain provisions that permit the holders of the notes to require that Sun Media repurchase or redeem the notes in the event of a takeover, recapitalization or similar transaction.

        Sun Media will not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements in the indenture applicable to a Change of Control Offer made by Sun Media and purchases all notes or portions of notes properly tendered and not withdrawn under such Change of Control Offer.

        The definition of Change of Control includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other disposition of "all or substantially all" of the properties or assets of Sun Media and its Subsidiaries taken as a whole. Although there is a limited body of case law interpreting the phrase "substantially all," there is no precise established definition of the phrase under applicable law. Accordingly, the obligation of Sun Media to make a Change of Control Offer and the ability of a holder of notes to require Sun Media to repurchase such notes pursuant to such an offer as a result of a sale, lease, transfer, conveyance or other disposition of less than all of the assets of Sun Media and its Subsidiaries taken as a whole to another Person or group may be uncertain.

        In addition to the obligations of Sun Media under the indenture with respect to the notes in the event of a Change of Control, the New Credit Facility provides that certain change of control events with respect to Sun Media would constitute a default under the New Credit Facility. In addition, any future credit facilities or other agreements relating to Indebtedness to which Sun Media becomes a party may prohibit or otherwise limit Sun Media from purchasing any notes prior to their maturity, and may also provide that certain change of control events with respect to Sun Media would constitute a default thereunder. In the event a Change of Control occurs at a time when Sun Media is prohibited from purchasing notes, Sun Media could seek the consent of its lenders to the purchase of notes or could attempt to refinance the borrowings that contain such restrictions. If Sun Media does not obtain such a consent or repay such borrowings, Sun Media will remain prohibited or otherwise restricted from purchasing notes. In addition, we cannot assure you that Sun Media will have sufficient financial resources available to purchase the notes at the time of a Change of Control. In such case, Sun Media's failure to purchase tendered notes would constitute an Event of Default under the indenture. See "Risk Factors—Risks Relating to the Notes—We may not be able to finance a change of control offer as required by the indenture because we may not have sufficient funds at the time of the change of control or our new credit facility may not allow the repurchases."

Asset Sales

        Sun Media will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:

(1)

Sun Media, or the Restricted Subsidiary, as the case may be, receives consideration at the time of the Asset Sale at least equal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of;

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(2)

such fair market value is determined by Sun Media's Board of Directors and evidenced by a resolution of the Board of Directors set forth in an officers' certificate delivered to the trustee; and



(3)

at least 75% of the consideration received in the Asset Sale by Sun Media or such Restricted Subsidiary is in the form of cash or Cash Equivalents. For purposes of this provision, each of the following shall be deemed to be cash:



(a)

any Indebtedness or other liabilities, as shown on Sun Media's or such Restricted Subsidiary's most recent balance sheet, of Sun Media or any Restricted Subsidiary, other than contingent liabilities and Indebtedness that are by their terms subordinated to the notes, that are assumed by the transferee of any such assets pursuant to an agreement that releases Sun Media or such Restricted Subsidiary from further liability with respect to such Indebtedness or liabilities; and



(b)

any securities, notes or other obligations received by Sun Media or any such Restricted Subsidiary from such transferee that are converted within 60 days of the applicable Asset Sale by Sun Media or such Restricted Subsidiary into cash, to the extent of the cash received in that conversion.

        Notwithstanding the foregoing paragraph, Sun Media and its Restricted Subsidiaries may engage in Asset Swaps if (i) immediately after giving effect to any such Asset Swap, Sun Media would be permitted to incur at least US$1.00 of additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth in the first paragraph of the covenant described under the caption "—Covenants—Incurrence of Indebtedness and Issuance of Preferred Shares," and (ii) Sun Media or such Restricted Subsidiary receives consideration at the time of such Asset Swap at least equal to the fair market value of the assets disposed of, which fair market value is determined by the Board of Directors of Sun Media or the Restricted Subsidiary, as the case may be, and evidenced by a resolution of such Board of Directors set forth in an officers' certificate delivered to the trustee; provided, however, that the Board of Directors' determination must be based upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada if the fair market value exceeds US$25.0 million.

        Within 360 days after the receipt of any Net Proceeds from an Asset Sale, Sun Media may apply those Net Proceeds at its option:

(1)

to permanently repay or reduce Indebtedness, other than Subordinated Indebtedness, of Sun Media or a Subsidiary Guarantor and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto;



(2)

to acquire, or enter into a binding agreement to acquire, all or substantially all of the assets (other than cash, Cash Equivalents and securities) of any Person engaged in a Permitted Business; provided, however, that any such commitment shall be subject only to customary conditions (other than financing), and such acquisition shall be consummated no later than 180 days after the end of this 360-day period;



(3)

to acquire, or enter into a binding agreement to acquire, Voting Stock of a Person engaged in a Permitted Business from a Person that is not an Affiliate of Sun Media; provided, however, that such commitment shall be subject only to customary conditions (other than financing) and such acquisition shall be consummated no later than 180 days after the end of such 360-day period; and provided, further, however, that (a) after giving effect thereto, the Person so acquired is a Restricted Subsidiary and (b) such acquisition is otherwise made in accordance with the indenture, including, without limitation, the covenant described under the caption "—Covenants—Restricted Payments;" or

84

(4)

to acquire, or enter into a binding agreement to acquire, other long-term assets (other than securities) that are used or useful in a Permitted Business; provided, however, that such commitment shall be subject only to customary conditions (other than financing) and such acquisition shall be consummated no later than 180 days after the end of this 360-day period.

Pending the final application of any Net Proceeds, Sun Media may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by the indenture.

        Any Net Proceeds from Asset Sales that are not applied, invested or segregated from the general funds of Sun Media for investment in identified assets pursuant to a binding agreement, in each case as provided in the preceding paragraph will constitute Excess Proceeds; provided, however, that the amount of any Net Proceeds that ceases to be so segregated as contemplated above shall also constitute "Excess Proceeds" at the time any such Net Proceeds cease to be so segregated; provided further, however, that the amount of any Net Proceeds that continues to be segregated for investment and that is not actually reinvested within 24 months from the date of the receipt of such Net Proceeds shall also constitute "Excess Proceeds."

        When the aggregate amount of Excess Proceeds exceeds US$20.0 million, Sun Media will make an Asset Sale Offer to all holders of notes and all holders of other indebtedness that is pari passu in right of payment with the notes containing provisions similar to those set forth in the indenture relating to the notes with respect to offers to purchase or redeem with the proceeds of sales of assets to purchase the maximum principal amount of notes that may be purchased with the Allocable Excess Proceeds, as defined below. The offer price in any Asset Sale Offer will be equal to 100% of the principal amount of the notes, plus accrued and unpaid interest and special interest, if any, to the date of purchase, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer and all holders of notes have been given the opportunity to tender their notes for purchase in accordance with the Asset Sale Offer and the indenture, Sun Media may use these Excess Proceeds for any purpose not otherwise prohibited by the indenture. If the aggregate principal amount of notes and such other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the trustee will select the notes and such other pari passu Indebtedness to be purchased on a pro rata basis. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.

        The term "Allocable Excess Proceeds" shall mean the product of:

(a)

the Excess Proceeds and



(b)

a fraction,



(1)

the numerator of which is the aggregate principal amount of the notes outstanding on the date of the Asset Sale Offer, and



(2)

the denominator of which is the sum of the aggregate principal amount of the notes outstanding on the date of the Asset Sale Offer and the aggregate principal amount of other Indebtedness of Sun Media outstanding on the date of the Asset Sale Offer that is pari passu in right of payment with the notes and subject to terms and conditions in respect of Asset Sales similar in all material respects to this covenant and requiring Sun Media to make an offer to repurchase such Indebtedness at substantially the same time as the Asset Sale Offer.

        Sun Media will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with each repurchase of notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sales provisions of the indenture, Sun Media will comply with the applicable securities laws and regulations and will not be deemed to

85

have breached its obligations under the Asset Sale provisions of the indenture by virtue of such conflict.

Selection and Notice

        If less than all of the notes are to be redeemed at any time, the trustee will select notes for redemption as follows:

(1)

if the notes are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which the notes are listed; or



(2)

if the notes are not listed on any national securities exchange, on a pro rata basis, by lot or by such method as the trustee shall deem fair and appropriate.

        No notes of less than US$1,000 will be redeemed in part. Notices of redemption will be mailed by first class mail at least 30 but not more than 60 days before the date of redemption to each holder of notes to be redeemed at its registered address. Notices of redemption may not be conditional.

        If any note is to be redeemed in part only, the notice of redemption that relates to that note will state the portion of the principal amount of that note that is to be redeemed. A new note in principal amount equal to the unredeemed portion of the original note will be issued in the name of the holder upon cancellation of the original note at Sun Media's expense. Notes called for redemption become irrevocably due and payable on the date fixed for redemption. On and after the redemption date, interest will cease to accrue on notes or portions of them called for redemption, provided that the redemption price has been paid or set aside as provided in the indenture.

Covenants

Restricted Payments

        Sun Media will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly:

(1)

declare or pay any dividend or make any other payment or distribution on account of Sun Media's or any of its Restricted Subsidiaries' Equity Interests, including, without limitation, any payment in connection with any merger or consolidation involving Sun Media or any of its Restricted Subsidiaries, or to the direct or indirect holders of Sun Media's or any of its Restricted Subsidiaries' Equity Interests in their capacity as such, other than dividends or distributions payable in Equity Interests (other than Disqualified Stock) of Sun Media or to Sun Media or a Restricted Subsidiary (and, if such Restricted Subsidiary is not a Wholly Owned Restricted Subsidiary, to the other shareholders of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by Sun Media or a Restricted Subsidiary of dividends or distributions of greater value than it would receive on a pro rata basis);



(2)

purchase, redeem or otherwise acquire or retire for value, including, without limitation, in connection with any merger or consolidation involving Sun Media, any Equity Interests of Sun Media, other than such Equity Interests of Sun Media held by Sun Media or any of its Affiliates, including any Restricted Subsidiary;



(3)

make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Back-to-Back Securities, Existing Back-to-Back Securities or Indebtedness that is subordinated to the notes, except, in the case of Indebtedness that is subordinated to the notes, a payment of interest at the Stated Maturity of such interest or principal at or within one year of the Stated Maturity of principal of such Indebtedness;



(4)

make any Restricted Investment; or

86

(5)

pay any amount of Management Fees (including Deferred Management Fees) to a Person other than Sun Media or a Restricted Subsidiary,

(all such payments and other actions set forth in clauses (1) through (5) above being collectively referred to as "Restricted Payments"), unless, at the time of and after giving effect to such Restricted Payment:

(1)

no Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment; and



(2)

Sun Media would have been permitted to incur at least US$1.00 of additional Indebtedness, other than Permitted Debt, pursuant to the Debt to Cash Flow Ratio test set forth in the first paragraph of the covenant described under the caption "—Incurrence of Indebtedness and Issuance of Preferred Shares;" and



(3)

such Restricted Payment, together with the aggregate amount of all other Restricted Payments declared or made after the Issue Date, excluding Restricted Payments made pursuant to clauses (2), (3), (4), (6), (7), (8), (9), (10), (11) and (12) of the next succeeding paragraph, shall not exceed, at the date of determination, the sum, without duplication, of:



(a)

an amount equal to Sun Media's Consolidated Cash Flow from the first date of the fiscal quarter in which the Issue Date occurs to the end of Sun Media's most recently ended full fiscal quarter for which internal financial statements are available, taken as a single accounting period, less the sum of 1.6 times Sun Media's Consolidated Interest Expense from the first date of the fiscal quarter in which the Issue Date occurs to the end of Sun Media's most recently ended full fiscal quarter for which internal financial statements are available, taken as a single accounting period; plus



(b)

an amount equal to 100% of Capital Stock Sale Proceeds, less any such Capital Stock Sale Proceeds used in connection with:



(i)

an Investment made pursuant to clause (6) of the definition of "Permitted Investments;" or



(ii)

an incurrence of Indebtedness pursuant to clause (4) of the covenant described under the caption "—Incurrence of Indebtedness and Issuance of Preferred Shares;" plus




(c)

to the extent that any Restricted Investment that was made after the Issue Date is sold for cash or otherwise liquidated or repaid for cash, the lesser of (i) the cash return of capital with respect to such Restricted Investment, less the cost of disposition, if any, and (ii) the initial amount of such Restricted Investment; plus



(d)

to the extent that the Board of Directors designates any Unrestricted Subsidiary that was designated as such after the Issue Date as a Restricted Subsidiary, the lesser of (i) the aggregate fair market value of all Investments owned by Sun Media and its Restricted Subsidiaries in such Subsidiary at the time such Subsidiary was designated as an Unrestricted Subsidiary and (ii) the then aggregate fair market value of all Investments owned by Sun Media and its Restricted Subsidiaries in such Unrestricted Subsidiary.

        The preceding provisions will not prohibit:

(1)

so long as no Default has occurred and is continuing or would be caused thereby, the payment of any dividend within 60 days after the date the dividend is declared, if at that date of declaration such payment would have complied with the provisions of the indenture; provided, however, that such dividend shall be included in the calculation of the amount of Restricted Payments;

87

(2)

so long as no Default has occurred and is continuing or would be caused thereby, the redemption, repurchase, retirement, defeasance or other acquisition of any Subordinated Indebtedness of Sun Media or of any Equity Interests of Sun Media in exchange for, or out of the net cash proceeds of the substantially concurrent sale, other than to a Subsidiary of Sun Media or an employee stock ownership plan or to a trust established by Sun Media or any Subsidiary of Sun Media for the benefit of its employees, of, Equity Interests (other than Disqualified Stock or Back-to-Back Securities);



(3)

so long as no Default has occurred and is continuing or would be caused thereby, the defeasance, redemption, repurchase or other acquisition of Subordinated Indebtedness of Sun Media or any Restricted Subsidiary with the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness;



(4)

so long as no Default has occurred and is continuing or would be caused thereby, regardless of whether any Default then exists, any payment by Sun Media or a Restricted Subsidiary of Sun Media to any one of the other of them;



(5)

so long as no Default has occurred and is continuing or would be caused thereby, the repurchase, redemption or other acquisition or retirement for value by Sun Media of any Equity Interests of Sun Media held by any member of Sun Media's, or any of its Subsidiaries', management pursuant to any management equity subscription agreement or stock option agreement in effect as of the Issue Date; provided, however, that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests shall not exceed US$2.0 million in any twelve-month period;



(6)

payments of any kind made in connection with or in respect of Back-to-Back Securities or the Existing Back-to-Back Securities; provided, however, that to the extent such payments are made to Affiliates of Sun Media (other than Subsidiaries), all corresponding payments required to be paid by such Affiliates pursuant to the related Back-to-Back Securities or Existing Back-to-Back Securities are received, immediately prior to or concurrently with any such payments, by all applicable Sun Media Entities;



(7)

so long as no Default has occurred and is continuing or would be caused thereby, the payment of dividends and other shares of Capital Stock of Sun Media in the form of Capital Stock (other than Disqualified Stock or Back-to-Back Securities);



(8)

so long as no Default has occurred and is continuing or would be caused thereby, any Tax Benefit Transaction;



(9)

so long as no Default has occurred and is continuing or would be caused thereby, the payment of any Management Fees or other similar expenses by Sun Media to its direct or indirect parent company for bona fide services (including reimbursement for expenses incurred in connection with, or allocation of corporate expenses in relation to, providing such services) provided to, and directly related to the operations of, Sun Media and its Restricted Subsidiaries, in an aggregate amount not to exceed 1.5% of Consolidated Revenues in any twelve-month period;



(10)

so long as no Default has occurred and is continuing or would be caused thereby, Restricted Payments in an amount equal to the amount of income tax refunds received by Sun Media or any Restricted Subsidiary in respect of fiscal years ended prior to the Issue Date not to exceed an aggregate of Cdn$30.0 million;



(11)

so long as no Default has occurred and is continuing or would be caused thereby, other Restricted Payments in an aggregate amount not to exceed US$30.0 million; and



(12)

the payment of the Cdn$260.0 million dividend described under "Use of Proceeds."

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        The amount of any Restricted Payment, other than those effected in cash, shall be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued to or by Sun Media or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any assets or securities that are required to be valued by this covenant will be determined by the Board of Directors, whose resolution with respect to this determination shall be delivered to the trustee. The Board of Directors' determination must be based upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada if the fair market value exceeds US$25.0 million; provided, that the Board of Directors shall not be required to obtain such an opinion or appraisal in connection with the payment of interest on Existing Back-to-Back Debt or any payments with respect to Back-to-Back Securities to the extent such Back-to-Back Transactions were approved in accordance with the provisions of the covenant described under the caption "—Transactions with Affiliates." Not later than the date of making any Restricted Payment, Sun Media will deliver to the trustee an officers' certificate stating that such Restricted Payment is permitted and setting forth the basis upon which the calculations required by this covenant were computed, together with a copy of any fairness opinion or appraisal required by the indenture.

        For purposes of this "Restricted Payments" covenant, if (i) any Sun Media Entity ceases to be the obligor under or issuer of any Back-to-Back Securities or Existing Back-to-Back Debt and a Person other than a Sun Media Entity becomes the obligor thereunder (or the issuer of any Back-to-Back Preferred Shares) or (ii) any Subsidiary Guarantor that is an obligor under or issuer of any Back-to-Back Securities or the obligor under any Existing Back-to-Back Debt ceases to be a Subsidiary Guarantor other than by consolidation or merger with Sun Media or another Subsidiary Guarantor, then Sun Media or such Subsidiary Guarantor shall be deemed to have made a Restricted Payment in an amount equal to the accreted value of such Back-to-Back Debt or Existing Back-to-Back Debt (or the subscription price of any Back-to-Back Preferred Shares) at the time of the assumption thereof by such other Person or at the time such Subsidiary Guarantor ceases to be a Subsidiary Guarantor.

Incurrence of Indebtedness and Issuance of Preferred Shares

        Sun Media will not, and will not permit any of its Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness, including Acquired Debt, and Sun Media will not issue any Disqualified Stock and will not permit any of its Subsidiaries to issue any Preferred Shares; provided, however, that Sun Media may incur Indebtedness, including Acquired Debt, or issue Disqualified Stock, and the Subsidiary Guarantors may incur Indebtedness, including Acquired Debt, or issue Preferred Shares, if Sun Media's Debt to Cash Flow Ratio at the time of incurrence of such Indebtedness or the issuance of such Disqualified Stock or Preferred Shares, after giving pro forma effect to such incurrence or issuance as of such date and to the use of proceeds from such incurrence or issuance, taking into account any substantially concurrent transactions related to such incurrence, as if the same had occurred at the beginning of the most recently ended four fiscal quarter period of Sun Media for which internal financial statements are available, would have been no greater than 5.0 to 1.0.

        The first paragraph of this covenant will not prohibit the incurrence of any of the following items of Indebtedness or issuances of Preferred Shares, which we refer to collectively as "Permitted Debt:"

(1)

the incurrence by Sun Media or a Subsidiary Guarantor of Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of Sun Media and the Subsidiary Guarantors thereunder) not to exceed an aggregate of (a) US$230.0 million and (b) Cdn$75.0 million, less the aggregate amount of all Net Proceeds of Asset Sales applied by Sun Media or any Subsidiary Guarantors subsequent to the Issue Date to permanently repay Indebtedness under a Credit

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Facility pursuant to the covenant described under the caption "—Repurchase at the Option of Holders—Asset Sales;"

(2)

the incurrence by Sun Media and its Restricted Subsidiaries of the Existing Indebtedness;



(3)

the incurrence by (a) Sun Media of Indebtedness represented by the notes to be issued on the Issue Date and the Exchange Notes to be issued in exchange for such notes and in exchange for any Additional Notes, and (b) the Subsidiary Guarantors of Indebtedness represented by the Subsidiary Guarantees relating to the notes issued in this offering and the Exchange Guarantees issued in exchange for such Subsidiary Guarantees and in exchange for the Subsidiary Guarantees relating to any Additional Notes;



(4)

the incurrence by Sun Media or a Subsidiary Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of Sun Media or such Subsidiary Guarantor, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (4), not to exceed US$25.0 million at any time outstanding;



(5)

the incurrence by Sun Media or any Subsidiary Guarantor of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness, other than intercompany Indebtedness, that was permitted by the indenture to be incurred under the first paragraph of this covenant or clauses (2), (3) and (4) of this paragraph;



(6)

the incurrence by Sun Media or any Subsidiary Guarantor of intercompany Indebtedness between or among Sun Media and any of its Restricted Subsidiaries; provided, however, that:



(a)

if Sun Media is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the notes, and



(b)

(i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than Sun Media or a Restricted Subsidiary thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either Sun Media or a Restricted Subsidiary of Sun Media will be deemed, in each case, to constitute an incurrence of such Indebtedness by Sun Media or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);




(7)

the issuance by Sun Media or any of its Restricted Subsidiaries of Preferred Shares solely to or among Sun Media and any of its Restricted Subsidiaries; provided, however, that (i) any subsequent issuance or transfer of Equity Interests that results in any such Preferred Shares being held by a Person other than Sun Media or a Restricted Subsidiary and (ii) any sale or other transfer of any such Preferred Shares to a Person that is not either Sun Media or a Restricted Subsidiary will be deemed, in each case, to constitute an issuance of such Preferred Shares by Sun Media or any of its Restricted Subsidiaries, as the case may be, that was not permitted by this clause (7);



(8)

the incurrence by Sun Media or any Subsidiary Guarantor of Hedging Obligations that are incurred in the ordinary course of business of Sun Media or such Subsidiary Guarantor and not for speculative purposes; provided, however, that, in the case of:



(a)

any Interest Rate Agreement, the notional principal amount of such Hedging Obligation does not exceed the principal amount of the Indebtedness to which such Hedging Obligation relates; and

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(b)

any Currency Exchange Protection Agreement, such Hedging Obligation does not increase the principal amount of Indebtedness of Sun Media and Subsidiary Guarantor outstanding other than as a result of fluctuations in foreign currency exchange rates or by reason of fees, indemnities and compensation payable thereunder;




(9)

the guarantee by Sun Media or a Subsidiary Guarantor of Indebtedness of Sun Media or a Subsidiary Guarantor that was permitted to be incurred by another provision of this covenant;



(10)

the incurrence by Sun Media or any of its Restricted Subsidiaries of Indebtedness in an aggregate principal amount, or accreted value, as applicable, at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (10), not to exceed US$25.0 million;



(11)

the issuance of Preferred Shares by Sun Media's Unrestricted Subsidiaries or the incurrence by Sun Media's Unrestricted Subsidiaries of Non-Recourse Debt; provided, however, that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, that event will be deemed to constitute an incurrence of Indebtedness by a Restricted Subsidiary of Sun Media that was not permitted by this clause (11);



(12)

Indebtedness of Sun Media or any Subsidiary Guarantor in respect of bank overdrafts (and letters of credit in respect thereof) in the ordinary course of business not to exceed an aggregate amount of US$10.0 million; and



(13)

the issuance of Indebtedness or Preferred Shares in connection with a Tax Benefit Transaction.

        The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant.

        Neither Sun Media nor any Subsidiary Guarantor will incur any Indebtedness, including Permitted Debt, that is contractually subordinated in right of payment to any other Indebtedness of Sun Media or such Subsidiary Guarantor, as applicable, unless such Indebtedness is also contractually subordinated in right of payment to the notes or the Subsidiary Guarantee, as applicable, on substantially identical terms; provided, however, that no Indebtedness of Sun Media or a Subsidiary Guarantor shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of Sun Media or such Subsidiary Guarantor, as applicable, solely by virtue of being unsecured.

        For purposes of determining compliance with this "Incurrence of Indebtedness and Issuance of Preferred Shares" covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (13) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, Sun Media will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this covenant. Indebtedness under Credit Facilities outstanding on the date on which notes are first issued and authenticated under the indenture shall be deemed to have been incurred on such date in reliance on the exception provided by either clause (1) or (2) of the second paragraph of this covenant, as applicable.

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Sale and Leaseback Transactions

        Sun Media will not, and will not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction; provided, however, that Sun Media or any Restricted Subsidiary may enter into a sale and leaseback transaction if:

(1)

Sun Media or that Restricted Subsidiary, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback transaction under the Debt to Cash Flow Ratio test in the first paragraph of the covenant described under the caption "—Incurrence of Indebtedness and Issuance of Preferred Shares" and (b) created a Lien on such property securing Attributable Debt pursuant to the covenant described below under the caption "—Liens;"



(2)

the net cash proceeds of that sale and leaseback transaction are at least equal to the fair market value, as determined in good faith by the Board of Directors and set forth in an officers' certificate delivered to the trustee, of the property that is the subject of that sale and leaseback transaction; and



(3)

the transfer of assets in that sale and leaseback transaction is permitted by, and Sun Media or that Restricted Subsidiary applies the proceeds of such transaction in compliance with, the covenant described under the caption "—Repurchase at the Option of Holders—Asset Sales."

Liens

        Sun Media will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind on any asset owned at the Issue Date or thereafter acquired, except Permitted Liens, unless Sun Media or such Restricted Subsidiary has made or will make effective provision to secure the notes and any applicable Subsidiary Guarantees by such Lien equally and ratably with all other Indebtedness of Sun Media or such Restricted Subsidiary secured by such Lien for so long as such other Indebtedness is secured by such Lien.

Dividend and Other Payment Restrictions Affecting Subsidiaries

        Sun Media will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:

(1)

pay dividends or make any other distributions on its Equity Interests to Sun Media or any other Restricted Subsidiary, or with respect to any other interest or participation in, or measured by, its profits, or pay any Indebtedness owed to Sun Media or any other Restricted Subsidiary;



(2)

make loans or advances, or guarantee any such loans or advances, to Sun Media or any other Restricted Subsidiary; or



(3)

transfer any of its properties or assets to Sun Media or any other Restricted Subsidiary.

        However, the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of:

(1)

agreements governing Existing Indebtedness and Credit Facilities as in effect on the Issue Date and any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings thereof; provided, however, that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacement or refinancings are no more restrictive, taken as a whole, with respect to such dividend and other

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payment restrictions than those contained in such Existing Indebtedness and Credit Facilities, as in effect on the Issue Date;

(2)

the indenture and the notes;



(3)

applicable law or any applicable rule, regulation or order;



(4)

any instrument governing Indebtedness or Capital Stock of a Person acquired by Sun Media or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred or issued in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired; provided, however, that, in the case of Indebtedness, such Indebtedness was permitted by the terms of the indenture to be incurred at the time of such acquisition;



(5)

customary non-assignment provisions in leases entered into in the ordinary course of business and consistent with past practices;



(6)

purchase money obligations for property acquired in the ordinary course of business that impose restrictions on the property so acquired of the nature described in clause (3) of the preceding paragraph;



(7)

any agreement for the sale or other disposition of a Restricted Subsidiary that restricts distributions by that Restricted Subsidiary pending its sale or other disposition;



(8)

Permitted Refinancing Indebtedness; provided, however, that the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are no more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced;



(9)

Liens securing Indebtedness that is permitted to be secured without also securing the notes or the applicable Subsidiary Guarantee pursuant to the covenant described under the caption "—Liens" that limit the right of the debtor to dispose of the assets subject to any such Lien;



(10)

provisions with respect to the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, stock sale agreements and other similar agreements entered into in the ordinary course of business;



(11)

restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business; and



(12)

any Indebtedness or any agreement pursuant to which such Indebtedness was issued if the encumbrance or restriction applies only upon a payment or financial covenant default or event of default contained in such Indebtedness or agreement and (A) the encumbrance or restriction is not materially more disadvantageous to the holders of the notes than is customary in comparable financings (as determined in good faith by the Board of Directors of Sun Media) or (B) management of Sun Media delivers to the trustee an officers' certificate evidencing its determination at the time such agreement is entered into, that such encumbrance or restriction will not materially impair Sun Media's ability to make payments on the notes.

Merger, Consolidation or Sale of Assets

        Sun Media may not directly or indirectly, (i) consolidate, merge or amalgamate with or into another Person, whether or not Sun Media is the surviving corporation, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of Sun Media and its

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Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person, unless, in either case,

(1)

either (a) Sun Media is the surviving corporation, or (b) the Person formed by or surviving any such consolidation, merger or amalgamation (if other than Sun Media) or to which such sale, assignment, transfer, conveyance or other disposition shall have been made is a corporation, limited liability company or limited partnership organized or existing under the laws of the United States, any state of the United States, the District of Columbia, Canada or any province or territory of Canada;



(2)

the Person formed by or surviving any such consolidation, merger or amalgamation (if other than Sun Media) or the Person to which such sale, assignment, transfer, conveyance or other disposition shall have been made expressly assumes all the obligations of Sun Media under the notes, the indenture and, if applicable, the registration rights agreement, pursuant to agreements reasonably satisfactory to the trustee;



(3)

immediately after giving effect to such transaction no Default or Event of Default exists; and



(4)

Sun Media or the Person formed by or surviving any such consolidation, merger or amalgamation, if other than Sun Media, or to which such sale, assignment, transfer, conveyance or other disposition has been made will, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable fiscal quarter, be permitted to incur at least US$1.00 of additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth in the first paragraph of the covenant described under the caption "—Incurrence of Indebtedness and Issuance of Preferred Shares."

        Unless in connection with a disposition by Sun Media or a Subsidiary Guarantor of its entire ownership interest in a Subsidiary Guarantor or all or substantially all the assets of a Subsidiary Guarantor permitted by, and in accordance with the applicable provisions of, the indenture, Sun Media will cause each Subsidiary Guarantor not to directly or indirectly, (i) consolidate, merge or amalgamate with or into another Person, whether or not such Subsidiary Guarantor is the surviving corporation, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of such Subsidiary Guarantor, in one or more related transactions, to another Person, unless, in either case,

(1)

either (a) such Subsidiary Guarantor is the surviving corporation, or (b) the Person formed by or surviving any such consolidation, merger or amalgamation (if other than such Subsidiary Guarantor) or to which such sale, assignment, transfer, conveyance or other disposition shall have been made is a corporation, limited liability company or limited partnership organized or existing under the laws of the United States, any state of the United States, the District of Columbia, Canada or any province or territory of Canada;



(2)

the Person formed by or surviving any such consolidation, merger or amalgamation, if other than such Subsidiary Guarantor, or the Person to which such sale, assignment, transfer, conveyance or other disposition shall have been made expressly assumes all the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee, the indenture and, if applicable, the registration rights agreement, pursuant to agreements reasonably satisfactory to the trustee;



(3)

immediately after giving effect to such transaction no Default or Event of Default exists; and



(4)

such Subsidiary Guarantor or the Person formed by or surviving any such consolidation, merger or amalgamation, if other than such Subsidiary Guarantor, or to which such sale, assignment, transfer, conveyance or other disposition has been made will, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if

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the same had occurred at the beginning of the applicable fiscal quarter, be permitted to incur at least US$1.00 of additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth in the first paragraph of the covenant described above under the caption "—Incurrence of Indebtedness and Issuance of Preferred Shares."

        In addition, Sun Media will not, and will cause each Subsidiary Guarantor not to, directly or indirectly, lease all or substantially all of its properties or assets, in one or more related transactions, to any other Person. This "Merger, Consolidation or Sale of Assets" covenant will not apply to a merger, consolidation or amalgamation, or a sale, assignment, transfer, conveyance or other disposition of assets, between or among Sun Media and any of its Restricted Subsidiaries.

Issuances and Sales of Equity Interests in Certain Subsidiaries

        Sun Media will not, and will not permit any Restricted Subsidiary to, transfer, convey, sell, lease or otherwise dispose of (including, without limitation, by way of merger, amalgamation or otherwise) any Equity Interests in any direct or indirect Restricted Subsidiary that is a Significant Subsidiary of Sun Media or any group of Restricted Subsidiaries which, when taken as a whole, would constitute a Significant Subsidiary to any Person (other than Sun Media or a Wholly Owned Restricted Subsidiary of Sun Media or to Quebecor Inc. or to any direct or indirect Subsidiary of Quebecor Inc. in connection with a Tax Benefit Transaction), unless:

(1)

such transfer, conveyance, sale, lease or other disposition (whether by way of merger, amalgamation or otherwise) is of all the Equity Interests of such Restricted Subsidiary; and



(2)

the Net Proceeds from such transfer, conveyance, sale, lease or other disposition (whether by way of merger, amalgamation or otherwise) are applied in accordance with the covenant described above under the caption "—Repurchase at the Option of Holders—Asset Sales."

        In addition, Sun Media will not permit any direct or indirect Restricted Subsidiary that constitutes a Significant Subsidiary or any group of Restricted Subsidiaries which, when taken as a whole, would constitute a Significant Subsidiary, to issue any Equity Interests to any Person, other than, (a) if necessary, shares of Capital Stock constituting directors' qualifying shares or (b) to Sun Media or a Wholly Owned Restricted Subsidiary of Sun Media.

Transactions with Affiliates

        Sun Media will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, make any payment to, or sell, lease, transfer, exchange or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction or series of transactions, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate, officer or director of Sun Media, each, an Affiliate Transaction, unless:

(1)

such Affiliate Transaction is (a) set forth in writing and (b) on terms that are no less favorable to Sun Media or the relevant Restricted Subsidiary than those that would have been obtained in a comparable arm's length transaction by Sun Media or such Restricted Subsidiary with an unrelated Person; and



(2)

Sun Media delivers to the trustee:



(a)

with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of US$10.0 million, a resolution of the Board of Directors set forth in an officers' certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors; and



(b)

with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of US$25.0 million, an opinion as to the

95

fairness to Sun Media or such Restricted Subsidiary of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada.

        The following items shall not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of the prior paragraph:

(1)

any employment agreement entered into by Sun Media or any of its Restricted Subsidiaries in the ordinary course of business and consistent with the past practice of Sun Media or such Restricted Subsidiary;



(2)

transactions between or among Sun Media and/or its Restricted Subsidiaries;



(3)

transactions with a Person that is an Affiliate of Sun Media solely because Sun Media owns an Equity Interest in such Person;



(4)

payment of reasonable directors fees to Persons who are not otherwise Affiliates of Sun Media;



(5)

sales of Equity Interests, other than Disqualified Stock, to Affiliates of Sun Media;



(6)

any agreement or arrangement as in effect on the Issue Date or any amendment thereto or any transaction contemplated thereby, including pursuant to any amendment thereto, in any replacement agreement or arrangement thereto so long as any such amendment or replacement agreement or arrangement is not more disadvantageous to Sun Media or its Restricted Subsidiaries, as the case may be, in any material respect than the original agreement as in effect on the Issue Date;



(7)

Restricted Payments that are permitted by the provisions of the indenture described under the caption "—Restricted Payments;"



(8)

Permitted Investments;



(9)

any transaction permitted by the covenant described under the caption "—Merger, Consolidation or Sale of Assets;" and



(10)

any Tax Benefit Transaction.

Future Guarantors

        Sun Media will cause each Person that (a) becomes a Restricted Subsidiary following the Issue Date and (b) guarantees any Indebtedness (including any Back-to-Back Debt or the Existing Back-to-Back Debt) of Sun Media or any Subsidiary of Sun Media to execute and deliver to the trustee a Subsidiary Guarantee at the time such Person becomes obligated under any such guarantee.

Designation of Restricted and Unrestricted Subsidiaries

        The Board of Directors may designate any Subsidiary to be an Unrestricted Subsidiary if such Subsidiary:

(1)

has no Indebtedness other than Non-Recourse Debt;



(2)

is not party to any agreement, contract, arrangement or understanding with Sun Media or any of its Restricted Subsidiaries unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to Sun Media or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of Sun Media;



(3)

is a Person with respect to which neither Sun Media nor any of its Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to

96

maintain or preserve such Person's financial condition or to cause such Person to achieve any specified levels of operating results;

(4)

except in the case of a Subsidiary Guarantor that is designated as an Unrestricted Subsidiary in accordance with the indenture, has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of Sun Media or any of its Restricted Subsidiaries;



(5)

has at least one director on its Board of Directors that is not a director or executive officer of Sun Media or any of its Restricted Subsidiaries and has at least one executive officer that is not a director or executive officer of Sun Media or any of its Restricted Subsidiaries; and



(6)

that designation would not cause a Default or Event of Default.

        Any designation of a Subsidiary of Sun Media as an Unrestricted Subsidiary shall be evidenced to the trustee by filing with the trustee a certified copy of the resolution of the Board of Directors giving effect to such designation and an officers' certificate certifying that such designation complied with the preceding conditions and was permitted by the covenant described under the caption "—Restricted Payments." If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of the indenture and any Preferred Shares of such Subsidiary shall be deemed to be issued and any Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary of Sun Media as of such date, and, if such Preferred Shares are not permitted to be issued or such Indebtedness is not permitted to be incurred as of such date under the covenant described under the caption "—Incurrence of Indebtedness and Issuance of Preferred Shares," Sun Media will be in default of such covenant.

        If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by Sun Media and its Restricted Subsidiaries in the Subsidiary so designated will be deemed to be an Investment made as of the time of such designation and will either reduce the amount available for Restricted Payments under the first paragraph of the covenant described above under the caption "—Restricted Payments" or reduce the amount available for future Investments under one or more clauses of the definition of Permitted Investments, as Sun Media shall determine. That designation will be permitted only if such Investment would be permitted at that time and if such Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. Upon designation of a Restricted Subsidiary as an Unrestricted Subsidiary in compliance with this covenant, such Subsidiary shall, by execution and delivery of a supplemental indenture in form satisfactory to the trustee, be released from any Subsidiary Guarantee previously made by such Subsidiary.

        The Board of Directors of Sun Media may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that such designation shall be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of Sun Media of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation shall only be permitted if (i) such Indebtedness is permitted under the covenant described under the caption "—Incurrence of Indebtedness and Issuance of Preferred Shares," calculated on a pro forma basis as if such designation had occurred at the beginning of the four-quarter reference period; and (ii) no Default or Event of Default would be in existence following such designation.

Reports

        For so long as any notes remain outstanding, Sun Media will furnish to the holders of the notes the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

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Whether or not Sun Media is subject to Section 13(a) or 15(d) of the Exchange Act, Sun Media shall file with the SEC and furnish to the holders of the notes and the trustee:

(1)

within 90 days after the end of each fiscal year, annual reports on Form 20-F or 40-F, as applicable, or any successor form; and



(2)

(a) within 45 days after the end of each of the first three fiscal quarters of each fiscal year, reports on Form 10-Q, or any successor form, or (b) within 60 days after the end of each of the first three fiscal quarters of each fiscal year, reports on Form 6-K, or any successor form, which, regardless of applicable requirements, shall, at a minimum, contain a "Management's Discussion and Analysis of Financial Condition and Results of Operations," and, with respect to any such reports, a reconciliation to U.S. GAAP as permitted by the SEC for foreign private issuers.

        If Sun Media has designated any of its Subsidiaries as Unrestricted Subsidiaries, then the quarterly and annual financial information required by the preceding paragraph shall include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes to the financial statements, and in Management's Discussion and Analysis of Financial Condition and Results of Operations, of the financial condition and results of operations of Sun Media and its Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of Sun Media.

Payments for Consent

        Sun Media will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for the benefit of any holder of notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of the indenture or the notes unless such consideration is offered to be paid and is paid to all holders of the notes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.

Events of Default and Remedies

        Each of the following is an Event of Default:

(1)

default for 30 days in the payment when due of interest on, including Additional Amounts or special interest, if any, or with respect to, the notes;



(2)

default in payment, when due at Stated Maturity, upon acceleration, redemption, required repurchase or otherwise, of the principal of, or premium, if any, on the notes;



(3)

failure by Sun Media or any of its Restricted Subsidiaries to comply with the provisions described under the captions "—Repurchase at the Option of Holders," "—Covenants—Incurrence of Indebtedness and Issuance of Preferred Shares," "—Covenants—Restricted Payments" or "—Covenants—Merger, Consolidation or Sale of Assets;"



(4)

failure by Sun Media or any Restricted Subsidiary for 30 days after written notice thereof has been given to Sun Media by the trustee or to Sun Media and the trustee by the holders of at least 25% of the aggregate principal amount of the notes outstanding to comply with any of its other covenants or agreements in the indenture;



(5)

default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness by Sun Media or any of its Restricted Subsidiaries, or the payment of which is guaranteed by Sun Media or any of its

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Restricted Subsidiaries, whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default:

(a)

is caused by a failure to pay principal of, or interest or premium, if any, on, such Indebtedness prior to the expiration of the grace period provided in such Indebtedness on the date of such default, which is referred to as a Payment Default; or



(b)

results in the acceleration of such Indebtedness prior to its Stated Maturity,

and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates US$25.0 million or more;

(6)

failure by Sun Media or any of its Restricted Subsidiaries to pay final, non-appealable judgments aggregating in excess of US$25.0 million, which judgments are not paid, discharged or stayed for a period of 60 days;



(7)

any Subsidiary Guarantee of a Significant Subsidiary ceases, or the Subsidiary Guarantees of any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary cease, to be in full force and effect (other than in accordance with the terms of any such Subsidiary Guarantee) or any Subsidiary Guarantor that is a Significant Subsidiary denies or disaffirms its obligations under its Subsidiary Guarantee, or a group of Subsidiary Guarantors that, when taken together, would constitute a Significant Subsidiary deny or disaffirm their obligations under their respective Subsidiary Guarantees; and



(8)

certain events of bankruptcy or insolvency described in the indenture with respect to Sun Media or any of its Significant Subsidiaries or any group of Subsidiaries that, taken together, would constitute a Significant Subsidiary.

        In the case of an Event of Default arising from certain events of bankruptcy or insolvency, with respect to Sun Media, any Subsidiary that is a Significant Subsidiary or any group of Subsidiaries that, taken together, would constitute a Significant Subsidiary, all outstanding notes will become due and payable immediately without further action or notice. If any other Event of Default occurs and is continuing, the trustee or the holders of at least 25% in principal amount of the then outstanding notes may declare all the notes to be due and payable immediately.

        Holders of the notes may not enforce the indenture or the notes except as provided in the indenture. Subject to certain limitations, holders of a majority in principal amount of the then outstanding notes may direct the trustee in its exercise of any trust or power. The trustee may withhold from holders of the notes notice of any continuing Default or Event of Default if and so long as it determines in good faith that withholding notice is in their interest, except a Default or Event of Default relating to the payment of principal, interest or special interest, if any.

        The holders of a majority in aggregate principal amount of the notes then outstanding by notice to the trustee may on behalf of the holders of all of the notes waive any existing Default or Event of Default and its consequences under the indenture except a continuing Default or Event of Default (i) in the payment of interest or special interest on, or the principal of, the notes and (ii) in respect of a covenant or provision which under the indenture cannot be modified or amended without the consent of the holder of each note affected by such modification or amendment.

        In the case of any Event of Default with respect to the notes occurring by reason of any willful action or inaction taken or not taken by or on behalf of Sun Media with the intention of avoiding payment of the premium that Sun Media would have had to pay if Sun Media then had elected to redeem the notes pursuant to the optional redemption provisions of the indenture, an equivalent premium will also become and be immediately due and payable to the extent permitted by law upon the acceleration of the notes. If an Event of Default occurs prior to February 15, 2008, by reason of any willful action (or inaction) taken (or not taken) by or on behalf of Sun Media with the intention of

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avoiding the prohibition on redemption of the notes prior to February 15, 2008, then the premium specified in the indenture will also become immediately due and payable to the extent permitted by law upon the acceleration of the notes.

        Sun Media is required to deliver to the trustee within 90 days after the end of each fiscal year a statement regarding compliance with the indenture. Upon becoming aware of any Default or Event of Default, Sun Media is required to deliver to the trustee a statement specifying such Default or Event of Default.

No Personal Liability of Directors, Officers, Employees and Shareholders

        No past, present or future director, officer, employee, incorporator or shareholder of Sun Media, as such, shall have any liability for any obligations of Sun Media or the Subsidiary Guarantors under the notes or the indenture or the Subsidiary Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each holder of notes by accepting a note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the notes. The waiver may not be effective to waive liabilities under United States federal securities laws.

Legal Defeasance and Covenant Defeasance

        Sun Media may, at its option and at any time, elect to have all of its obligations discharged with respect to the outstanding notes, and release each Subsidiary Guarantor from all of its obligations under its Subsidiary Guarantee, which we refer to as Legal Defeasance, except for:

(1)

the rights of holders of outstanding notes to receive payments in respect of the principal of, or interest or premium and Additional Amounts and special interest, if any, on such notes when such payments are due from the trust referred to below;



(2)

Sun Media's obligation with respect to the notes concerning issuing temporary notes, registration of notes, mutilated, destroyed, lost or stolen notes and the maintenance of an office or agency for payment and money for security payments held in trust;



(3)

the rights, powers, trusts, duties and immunities of the trustee, and Sun Media's obligations in connection therewith; and



(4)

the Legal Defeasance provisions of the indenture.

        In addition, Sun Media may, at its option and at any time, elect to have its obligations released with respect to certain covenants that are described in the indenture, and release each Subsidiary Guarantor from all of its obligations under its Subsidiary Guarantee with respect to these covenants, which we refer to as Covenant Defeasance. Thereafter, any omission to comply with those covenants shall not constitute a Default or Event of Default with respect to the notes. In the event Covenant Defeasance occurs, certain events, not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events, described under the caption "—Events of Default and Remedies" will no longer constitute an Event of Default with respect to the notes.

        In order to exercise either Legal Defeasance or Covenant Defeasance:

(1)

Sun Media must irrevocably deposit with the trustee, in trust, for the benefit of the holders of the notes cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, or interest and premium and Additional Amounts and special interest, if any, on the outstanding notes on the Stated Maturity or on the applicable date of redemption, as the case may be, and Sun Media must specify whether the notes are being defeased to maturity or to a particular date of redemption;



(2)

in the case of Legal Defeasance, Sun Media shall have delivered to the trustee an opinion of counsel reasonably acceptable to the trustee confirming that (a) Sun Media has received from,

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or there has been published by, the Internal Revenue Service a ruling or (b) since the Issue Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion of counsel shall confirm that, the holders of the outstanding notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred and Sun Media shall have delivered to the trustee an opinion of counsel in Canada reasonably acceptable to the trustee confirming that the holders of the outstanding notes will not recognize income, gain or loss for Canadian federal, provincial or territorial income tax purposes as a result of such Legal Defeasance and will be subject to Canadian federal, provincial or territorial income tax (including withholding tax) on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

(3)

in the case of Covenant Defeasance, Sun Media shall have delivered to the trustee an opinion of counsel reasonably acceptable to the trustee confirming that the holders of the outstanding notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred and Sun Media shall have delivered to the trustee an opinion of counsel in Canada reasonably acceptable to the trustee confirming that the holders of the outstanding notes will not recognize income, gain or loss for Canadian federal, provincial or territorial income tax purposes as a result of such Covenant Defeasance and will be subject to Canadian federal, provincial or territorial income tax (including withholding tax) on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;



(4)

no Default or Event of Default shall have occurred and be continuing on the date of such deposit, other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit;



(5)

such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under any material agreement or instrument, other than the indenture, to which Sun Media or any of its Subsidiaries is a party or by which Sun Media or any of its Subsidiaries is bound;



(6)

Sun Media must have delivered to the trustee an opinion of counsel to the effect that, assuming no intervening bankruptcy of Sun Media between the date of deposit and the 91st day following the deposit and assuming that no holder is an "insider" of Sun Media under applicable bankruptcy law, after the 91st day following the deposit, the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally;



(7)

Sun Media must deliver to the trustee an officers' certificate stating that the deposit was not made by Sun Media with the intent of preferring the holders of notes over the other creditors of Sun Media with the intent of defeating, hindering, delaying or defrauding creditors of Sun Media or others; and



(8)

Sun Media must deliver to the trustee an officers' certificate and an opinion of counsel, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.

Amendment, Supplement and Waiver

        Except as provided in the next two succeeding paragraphs, Sun Media and the trustee may amend or supplement the indenture or the notes with the consent of the holders of at least a majority in

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principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, the notes), and any existing Default or Event of Default (except a continuing Default or Event of Default (i) in the payment of interest or special interest on, or the principal of, the notes and (ii) in respect of a covenant or provision under which the indenture cannot be modified or amended without the consent of the holder of each note affected by such modification or amendment) or compliance with any provision of the indenture or the notes may be waived with the consent of the holders of a majority in principal amount of the then outstanding notes (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, notes).

        Without the consent of each holder affected, an amendment or waiver may not (with respect to any notes held by a non-consenting holder):

(1)

reduce the principal amount of notes whose holders must consent to an amendment, supplement or waiver;



(2)

reduce the principal of or change the Stated Maturity of any note or alter the provisions with respect to the redemption of the notes, other than provisions relating to the covenants described under the caption "—Repurchase at the Option of Holders;"



(3)

reduce the rate of or change the time for payment of interest, including special interest, if any, on any note;



(4)

waive a Default or Event of Default in the payment of principal of, or interest or premium, or special interest, if any, on the notes, except a rescission of acceleration of the notes by the holders of at least a majority in aggregate principal amount of the notes and a waiver of the payment default that resulted from such acceleration;



(5)

make any note payable in money other than that stated in the notes;



(6)

make any change in the provisions of the indenture relating to waivers of past Defaults or the rights of holders of notes to receive payments of principal of, or interest or premium or special interest, if any, on the notes, or to the institute suit for the enforcement of any payment on or with respect to such holders' notes or any Subsidiary Guarantee;



(7)

waive a redemption payment with respect to any note, other than a payment required by one of the covenants described under the caption "—Repurchase at the Option of Holders;"



(8)

subordinate the notes or any Subsidiary Guarantee to any other obligation of Sun Media or the applicable Subsidiary Guarantor;



(9)

amend or modify the provisions described under the caption "—Payment of Additional Amounts;"



(10)

amend or modify any Subsidiary Guarantee in a manner that would adversely affect the holders of the notes; or



(11)

make any change in the preceding amendment and waiver provisions.

        Notwithstanding the preceding, without the consent of any holder of notes, Sun Media and the trustee may amend or supplement the indenture or the notes:

(1)

to cure any ambiguity, defect or inconsistency;



(2)

to provide for uncertificated notes in addition to or in place of certificated notes;



(3)

to provide for the assumption of the obligations of Sun Media or any Subsidiary Guarantor to holders of notes in the case of a merger, consolidation, or amalgamation or sale of all or

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substantially all of the assets of Sun Media or such Subsidiary Guarantor, as the case may be; provided, however, that Sun Media delivers to the trustee:

(a)

an opinion of counsel to the effect that holders of the notes will not recognize income, gain or loss for U.S. Federal income tax purposes as a result of such assumption by a successor corporation and will be subject to U.S. federal income tax on the same amount and in the same manner and at the same times as would have been the case if such assumption had not occurred, and



(b)

an opinion of counsel in Canada to the effect that holders of the notes will not recognize income, gain or loss for Canadian federal, provincial or territorial tax purposes as a result of such assumption by a successor corporation and will be subject to Canadian federal, provincial or territorial taxes (including withholding taxes) on the same amounts, in the same manner and at the same times as would have been the case if such assumption had not occurred;





(4)

to make any change that would provide any additional rights or benefits to the holders of the notes or that does not adversely affect the legal rights under the indenture of any such holder;



(5)

to add additional Guarantees with respect to the notes or release Subsidiary Guarantors from Subsidiary Guarantees as provided or permitted by the terms of the indenture;



(6)

provide for the issuance of Additional Notes in accordance with the indenture; or



(7)

to comply with requirements of the SEC in order to effect or maintain the qualification of the indenture under the Trust Indenture Act.

Satisfaction and Discharge

        The indenture will be discharged and will cease to be of further effect as to all notes issued thereunder, when:

(1)

either:



(a)

all notes that have been authenticated, except lost, stolen or destroyed notes that have been replaced or paid and notes for whose payment money has theretofore been deposited in trust and thereafter repaid to Sun Media, have been delivered to the trustee for cancellation; or



(b)

all notes that have not been delivered to the trustee for cancellation have become due and payable by reason of the making of a notice of redemption or otherwise or will become due and payable within one year and Sun Media has irrevocably deposited or caused to be deposited with the trustee as trust funds in trust solely for the benefit of the holders of the notes, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire indebtedness on the notes not delivered to the trustee for cancellation for principal, premium and Additional Amounts and special interest, if any, and accrued interest to the date of maturity or redemption;





(2)

no Default or Event of Default shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which Sun Media is a party or by which Sun Media is bound;



(3)

Sun Media has paid or caused to be paid all sums payable by it under the indenture; and



(4)

Sun Media has delivered irrevocable instructions to the trustee under the indenture to apply the deposited money toward the payment of the notes at maturity or the date of redemption, as the case may be.

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        In addition, in each case, Sun Media must deliver an officers' certificate and an opinion of counsel to the trustee stating that all conditions precedent to satisfaction and discharge have been satisfied.

Concerning the Trustee

        If the trustee becomes a creditor of Sun Media, the indenture limits its right to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The trustee will be permitted to engage in other transactions; however, if it acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the SEC for permission to continue or resign.

        The holders of a majority in principal amount of the then outstanding notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the trustee, subject to certain exceptions. The indenture provides that if an Event of Default shall occur and be continuing, the trustee will be required, in the exercise of its power, to use the degree of care of a prudent person in the conduct of his or her own affairs. Subject to such provisions, the trustee will not be under an obligation to exercise any of its rights or powers under the indenture at the request of any holder of notes, unless such holder shall have offered to the trustee security and indemnity satisfactory to it against any loss, liability or expense that might be incurred by it in compliance with this request.

Additional Information

        Anyone who receives this prospectus may obtain a copy of the indenture and registration rights agreement without charge by writing to Sun Media Corporation, at 333 King Street East, Toronto, Ontario, Canada M5A 3X5.

Governing Law

        The indenture and the notes will be governed by and construed in accordance with the laws of the State of New York.

Enforceability of Judgments

        Since substantially all of the assets of Sun Media are outside the United States, any judgments obtained in the United States against Sun Media, including judgments with respect to the payment of principal, premium, interest, special interest, Additional Amounts, Change of Control Payment, offer price, redemption price or other amounts payable under the notes, may not be collectible within the United States.

        Sun Media's assets are located principally in Québec, Ontario, Alberta and British Columbia. Sun Media has been informed by its Canadian counsel, Ogilvy Renault, that the laws of Québec, Ontario, Alberta and British Columbia permit an action to be brought in a court of competent jurisdiction in Québec, Ontario, Alberta and British Columbia (a "Canadian Court") on any final, conclusive and enforceable judgment in personam of any federal or state court located in the Borough of Manhattan in the City of New York (a "New York Court") that is not impeachable as void or voidable (or subject to ordinary remedy in Québec) under the internal laws of the State of New York for a sum certain if (i) the court rendering such judgment had jurisdiction over the judgment debtor, as recognized by a Canadian Court (submission by Sun Media in the indenture to the jurisdiction of the New York Court being sufficient for such purpose); (ii) such judgment was not obtained by fraud or in a manner contrary to natural justice or in contravention of the fundamental principles of procedure and the decision and enforcement thereof would not be inconsistent with public policy or public order, as such terms are understood under the laws of Québec, Ontario, Alberta and British Columbia and the federal laws of Canada applicable in these provinces, as the case may be (or inconsistent with public order as

104

understood in international relations in Québec); (iii) the enforcement of such judgment does not constitute, directly or indirectly, the enforcement of foreign revenue laws (including taxation laws) or other laws of a public nature, such as expropriatory or penal laws; (iv) the action to enforce such judgment is commenced within the applicable limitation period; (v) in Québec, a dispute between the same parties, based on the same facts and having the same object, has not given rise to a decision rendered in Québec, whether or not it has obtained a final judgment, is not pending before a Québec authority in the first instance, or has not been decided in a third country, and the decision has met the necessary conditions for recognition in Québec; and (vi) in Québec, the decision has not been rendered by default unless the plaintiff has proven due service on the defaulting party in accordance with the laws of the jurisdiction in which the decision was rendered. Ogilvy Renault is not aware of any reasons under the present laws of Québec, Ontario, Alberta and British Columbia for avoiding enforcement of judgments of a New York Court with respect to the indenture or the notes on the basis of public policy or order, as that term is understood in international relations and under the laws of Québec, Ontario, Alberta and British Columbia and the federal laws of Canada applicable in these provinces.

        In addition, under the Currency Act (Canada), a Canadian Court may only render judgment for a sum of money in Canadian currency, and in enforcing a foreign judgment for a sum of money in a foreign currency, a Canadian Court will render its decision in the Canadian currency equivalent of such foreign currency.

Book-Entry, Delivery and Form

        Except as set forth below, the new notes will be issued in registered, global form in minimum denominations of US$1,000 and integral multiples of US$1,000 in excess of US$1,000. New notes will be issued at the closing of the exchange offer only against surrender of old notes.

        The new notes initially will be represented by one or more notes in registered, global form without interest coupons, collectively, the Rule 144A global notes. Regulation S notes initially will be represented by one or more notes in registered, global form without interest coupons, which are referred to in this prospectus as the global notes. The global notes will be deposited upon issuance with the trustee as custodian for The Depository Trust Company, or DTC, in New York, New York, and registered in the name of DTC or its nominee in each case for credit to an account of a direct or indirect participant in DTC as described below.

        Except as set forth below, the global notes may be transferred, in whole and not in part, only by DTC to another nominee of DTC, by a nominee of DTC to DTC or another nominee, or by DTC to or this nominee to a successor of DTC or a nominee of this successor. Beneficial interests in the global notes may not be exchanged for notes in certificated form except in the limited circumstances described below. See "—Exchange of Global Notes for Certificated Notes." Except in the limited circumstances described below, owners of beneficial interests in the global notes will not be entitled to receive physical delivery of notes in certificated form.

        Transfers of beneficial interests in the global notes will be subject to the applicable rules and procedures of DTC and its direct or indirect participants, including, if applicable, those of Euroclear and Clearstream, which may change from time to time.

Depositary Procedures

        The following description of the operations and procedures of DTC, Euroclear and Clearstream are provided solely as a matter of convenience. These operations and procedures are solely within the control of the respective settlement systems and are subject to changes by them. Sun Media takes no responsibility for these operations and procedures and urges investors to contact the system or their participants directly to discuss these matters.

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        DTC has advised Sun Media that DTC is a limited-purpose trust company created to hold securities for its participants and to facilitate the clearance and settlement of transactions in those securities between these participants through electronic book-entry changes in accounts of its participants. The participants include securities brokers and dealers (including the initial purchasers), banks, trust companies, clearing corporations and certain other organizations. Access to DTC's system is also available to indirect participants, which include other entities such as banks, brokers, dealers and trust companies, that clear through or maintain a custodial relationship with a participant, either directly or indirectly. Persons who are not participants may beneficially own securities held by or on behalf of DTC only through the participants or the indirect participants. The ownership interests in, and transfers of ownership interests in, each security held by or on behalf of DTC are recorded on the records of the participants and indirect participants.

        DTC has also advised Sun Media that, pursuant to procedures established by it:

(1)

upon deposit of the global notes, DTC will credit the accounts of participants designated by the initial purchasers with portions of the principal amount of the global notes; and



(2)

ownership of these interests in the global notes will be shown on, and the transfer of ownership thereof will be effected only through, records maintained by DTC (with respect to the participants) or by the participants and the indirect participants (with respect to other owners of beneficial interest in the global notes).

        Investors in the global notes who are participants in DTC's system may hold their interests in the global notes directly through DTC. Investors in the global notes who are not participants may hold their interests in the global notes indirectly through organizations (including Euroclear and Clearstream) which are participants in such system. Euroclear and Clearstream will hold interests in the global notes on behalf of their participants through customers' securities accounts in their respective names on the books of their respective depositories, which are Morgan Guaranty Trust Company of New York, Brussels office, as operator of Euroclear, and Citibank, N.A and The Chase Manhattan Bank N.A., as operator of Clearstream. All interests in a global note, including those held through Euroclear or Clearstream, may be subject to the procedures and requirements of DTC. Those interests held through Euroclear or Clearstream may also be subject to the procedures and requirements of such systems. The laws of some states require that certain Persons take physical delivery in definitive form of securities that they own. Consequently, the ability to transfer beneficial interests in a global note to such Persons will be limited to that extent. Because DTC can act only on behalf of participants, which in turn act on behalf of indirect participants, the ability of a Person having beneficial interests in a global note to pledge such interests to Persons that do not participate in the DTC system, or otherwise take actions in respect of such interests, may be affected by the lack of a physical certificate evidencing such interests.

Except as described below, owners of interest in the global notes will not have notes registered in their names, will not receive physical delivery of notes in certificated form and will not be considered the registered owners or "holders" thereof under the indenture for any purpose.

        Payments in respect of the principal of, and interest and premium and special interest, if any, on a global note registered in the name of DTC or its nominee will be payable to DTC in its capacity as the registered holder under the indenture. Under the terms of the indenture, Sun Media and the trustee will treat the Persons in whose names the notes, including the global notes, are registered as the owners for the purpose of receiving payments and for all other purposes. Consequently, none of Sun Media, the trustee or any agent of Sun Media or the trustee has or will have any responsibility or liability for:

(1)

any aspect of DTC's records or any participant's or indirect participant's records relating to or payments made on account of beneficial ownership interests in the global notes or for

106

maintaining, supervising or reviewing any of DTC's records or any participant's or indirect participant's records relating to the beneficial ownership interests in the global notes; or

(2)

any other matter relating to the actions and practices of DTC or any of its participants or indirect participants.

        DTC has advised Sun Media that its current practice, upon receipt of any payment in respect of securities such as the notes (including principal and interest), is to credit the accounts of the relevant participants with the payment on the payment date in accordance with instructions provided to DTC. Each relevant participant is credited with an amount proportionate to its beneficial ownership of an interest in the principal amount of the relevant security as shown on the records of DTC. Payments by the participants and the indirect participants to the beneficial owners of notes will be governed by standing instructions and customary practices and will be the responsibility of the participants or the indirect participants and will not be the responsibility of DTC, the trustee or Sun Media. Neither Sun Media nor the trustee will be liable for any delay by DTC or any of its participants in identifying the beneficial owners of the notes, and Sun Media and the trustee may conclusively rely on and will be protected in relying on instructions from DTC or its nominee for all purposes.

        Transfers between participants in DTC will be effected in accordance with DTC's procedures, and will be settled in same-day funds, and transfers between participants in Euroclear and Clearstream will be effected in accordance with their respective rules and operating procedures.

        Cross-market transfers between the participants in DTC, on the one hand, and Euroclear or Clearstream participants, on the other hand, will be effected through DTC in accordance with DTC's rules on behalf of each of Euroclear or Clearstream, as the case may be, by its respective depositary; however, such cross-market transactions will require delivery of instructions to Euroclear or Clearstream as the case may be, by the counterparty in such system in accordance with the rules and procedures and within the established deadlines (Brussels time) of such system. Euroclear or Clearstream, as the case may be, will, if the transaction meets its settlement requirements, deliver instructions to its respective depositary to take action to effect final settlement on its behalf by delivering or receiving interests in the relevant global note in DTC, and making or receiving payment in accordance with normal procedures for same-day funds settlement applicable to DTC. Euroclear participants and Clearstream participants may not deliver instructions directly to the depositaries for Euroclear or Clearstream.

        DTC has advised Sun Media that it will take any action permitted to be taken by a holder of notes only at the direction of one or more participants to whose account DTC has credited the interests in the global notes and only in respect of such portion of the aggregate principal amount of the notes as to which such participant or participants has or have given such direction. However, if there is an Event of Default under the notes, DTC reserves the right to exchange the global notes for legended notes in certificated form, and to distribute such notes to its participants.

        Although DTC, Euroclear and Clearstream have agreed to the foregoing procedures to facilitate transfers of interests in the global notes among participants in DTC, Euroclear and Clearstream, they are under no obligation to perform or to continue to perform such procedures, and may discontinue such procedures at any time. None of Sun Media or the trustee or any of their respective agents will have any responsibility for the performance by DTC, Euroclear or Clearstream or their respective participants or indirect participants of their respective obligations under the rules and procedures governing their operations.

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Exchange of Global Notes for Certificated Notes

        A global note is exchangeable for definitive notes in registered certificated form, which we refer to as certificated notes, if:

(1)

DTC notifies Sun Media that it (a) is unwilling or unable to continue as depositary for the global notes or (b) has ceased to be a clearing agency registered under the Exchange Act and, in either case, Sun Media fails to appoint a successor depositary within 120 days after the date of this notice;



(2)

Sun Media, at its option, notifies the trustee in writing that it elects to cause the issuance of the certificated notes; or



(3)

there shall have occurred and be continuing a Default or Event of Default with respect to the notes.

        In addition, beneficial interests in a global note may be exchanged for certificated notes upon prior written notice given to the trustee by or on behalf of DTC in accordance with the indenture. In all cases, certificated notes delivered in exchange for any global note or beneficial interests in global notes will be registered in the names, and issued in any approved denominations, requested by or on behalf of the depositary (in accordance with its customary procedures).

Exchange of Certificated Notes for Global Notes

        Certificated notes may not be exchanged for beneficial interests in any global note unless the transferor first delivers to the trustee a written certificate, in the form provided in the indenture, to the effect that such transfer will comply with the appropriate transfer restrictions applicable to such notes.

Same Day Settlement and Payment

        Sun Media will make payments in respect of the notes represented by the global notes (including principal, premium, if any, interest and special interest, if any) by wire transfer of immediately available funds to the accounts specified by the global note holder. Sun Media will make all payments of principal, interest and premium and special interest, if any, with respect to certificated notes by wire transfer of immediately available funds to the accounts specified by the holders thereof or, if no such account is specified, by mailing a check to each such holder's registered address. The new notes represented by the global notes are expected to trade in DTC's Same-Day Funds Settlement System, and any permitted secondary market trading activity in such notes will, therefore, be required by DTC to be settled in immediately available funds. Sun Media expects that secondary trading in any certificated notes will also be settled in immediately available funds.

        Because of time zone differences, the securities account of a Euroclear or Clearstream participant purchasing an interest in a global note from a participant in DTC will be credited, and any such crediting will be reported to the relevant Euroclear or Clearstream participant, during the securities settlement processing day (which must be a business day for Euroclear and Clearstream) immediately following the settlement date of DTC. DTC has advised Sun Media that cash received in Euroclear or Clearstream as a result of sales of interests in a global note by or through a Euroclear or Clearstream participant to a participant in DTC will be received with value on the settlement date of DTC but will be available in the relevant Euroclear or Clearstream cash account only as of the business day for Euroclear or Clearstream following DTC's settlement date.

Consent to Jurisdiction and Service

        The indenture provides that Sun Media irrevocably appoints CT Corporation System as its agent for service of process in any suit, action, or proceeding with respect to the indenture or the notes and

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for actions brought under federal or state securities laws in any federal or state court located in the Borough of Manhattan in The City of New York and submits to such non-exclusive jurisdiction.

Definitions

        Set forth below are defined terms used in the indenture. Reference is made to the indenture for a full disclosure of all these terms, as well as any other capitalized terms used in this prospectus for which no definition is provided.

        "Acquired Debt" means, with respect to any specified Person:

(1)

Indebtedness of any other Person existing at the time such other Person is merged with or into or becomes a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Subsidiary of such specified Person; and



(2)

Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

        "Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, "control," as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however, that beneficial ownership of more than 10% of the Voting Stock of a Person shall be deemed to be control. For purposes of this definition, the terms "controlling," "controlled by" and "under common control with" shall have correlative meanings.

        "Asset Acquisition" means (1) an Investment by Sun Media or any Restricted Subsidiary in any other Person pursuant to which such Person shall become a Restricted Subsidiary or shall be consolidated or merged with or into Sun Media or any Restricted Subsidiary or (2) any acquisition by Sun Media or any Restricted Subsidiary of the assets of any Person that constitute substantially all of an operating unit, a division or line of business of such Person or that is otherwise outside of the ordinary course of business.

        "Asset Sale" means:

(1)

the sale, lease, conveyance or other disposition of any assets or rights, other than sales of inventory in the ordinary course of business; provided, however, that the sale, conveyance or other disposition of all or substantially all of the assets of Sun Media and its Subsidiaries, taken as a whole, will be governed by the provisions of the indenture described under the caption "—Repurchase at the Option of Holders—Change of Control" and/or the provisions described under the caption "—Covenants—Merger, Consolidation or Sale of Assets" and not by the provisions of the indenture described under "—Repurchase at the Option of Holders—Asset Sales;" and



(2)

the issuance of Equity Interests of any of Sun Media's Restricted Subsidiaries or the sale of Equity Interests in any of its Restricted Subsidiaries.

        Notwithstanding the preceding, the following items shall not be deemed to be Asset Sales:

(1)

any single transaction or series of related transactions that involves assets having a fair market value (as determined by the Board of Directors and evidenced by a resolution of the Board of Directors set forth in an officers' certificate and delivered to the trustee) of less than US$1.0 million;



(2)

a sale, lease, conveyance or other disposition of assets between or among Sun Media and its Subsidiary Guarantors;

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(3)

an issuance of Equity Interests by a Restricted Subsidiary to Sun Media or to another Restricted Subsidiary;



(4)

the sale, lease, conveyance or other disposition of equipment, inventory, accounts receivable or other assets in the ordinary course of business;



(5)

the sale or other disposition of cash or Cash Equivalents;



(6)

any Tax Benefit Transaction;



(7)

a Restricted Payment or Permitted Investment that is permitted by the covenant described above under the caption "—Covenants—Restricted Payments."

        "Asset Swap" means an exchange of assets by Sun Media or a Restricted Subsidiary of Sun Media for:

(1)

one or more Permitted Businesses;



(2)

a controlling equity interest in any Person whose assets consist primarily of one or more Permitted Businesses; and/or



(3)

long-term assets that are used in a Permitted Business in a like-kind exchange or transfer pursuant to Section 1031 of the Internal Revenue Code or any similar or successor provision of the Internal Revenue Code or Sections 51, 85, 85.1, 86, 87 or 88(1) of the Income Tax Act (Canada) or any similar or successor provisions of the Income Tax Act (Canada).

        "Attributable Debt" in respect of a sale and leaseback transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended. Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP.

        "Back-to-Back Debt" means any loans made or debt instruments issued as part of a Back-to-Back Transaction and in which each party to such Back-to-Back Transaction, other than a Sun Media Entity, executes a subordination agreement in favor of the holders of the notes in substantially the form attached as an exhibit to the indenture.

        "Back-to-Back Preferred Shares" means Preferred Shares issued:

(a)

to a Sun Media Entity by an Affiliate of Sun Media in circumstances where, immediately prior to or after, as the case may be, the issuance of such Preferred Shares, an Affiliate of such Sun Media Entity has loaned on an unsecured basis to such Sun Media Entity, or an Affiliate of such Sun Media Entity has subscribed for Preferred Shares of such Sun Media Entity in an amount equal to, the requisite subscription price for such Preferred Shares;



(b)

by a Sun Media Entity to one of its Affiliates in circumstances where, immediately prior to or after, as the case may be, the issuance of such Preferred Shares, such Sun Media Entity has loaned an amount equal to the proceeds of such issuance to an Affiliate on an unsecured basis; or



(c)

by a Sun Media Entity to one of its Affiliates in circumstances where, immediately prior to or after, as the case may be, the issuance of such Preferred Shares, such Sun Media Entity has used the proceeds of such issuance to subscribe for Preferred Shares issued by an Affiliate;

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        in each case on terms whereby:

(i)

the aggregate redemption amount applicable to the Preferred Shares issued to or by such Sun Media Entity is identical:



(A)

in the case of (a) above, to the principal amount of the loan made or the aggregate redemption amount of the Preferred Shares subscribed for by such Affiliate;



(B)

in the case of (b) above, to the principal amount of the loan made to such Affiliate; or



(C)

in the case of (c) above, to the aggregate redemption amount of the Preferred Shares issued by such Affiliate;




(ii)

the dividend payment date applicable to the Preferred Shares issued to or by such Sun Media Entity will:



(A)

in the case of (a) above, be immediately prior to, or on the same date as, the interest payment date relevant to the loan made or the dividend payment date on the Preferred Shares subscribed for by such Affiliate;



(B)

in the case of (b) above, be immediately after, or on the same date as, the interest payment date relevant to the loan made to such Affiliate; or



(C)

in the case of (c) above, be immediately after, or on the same date as, the dividend payment date on the Preferred Shares issued by such Affiliate;




(iii)

the amount of dividends provided for on any payment date in the share conditions attaching to the Preferred Shares issued:



(A)

to a Sun Media Entity in the case of (a) above, will be equal to or in excess of the amount of interest payable in respect of the loan made or the amount of dividends provided for in respect of the Preferred Shares subscribed for by such Affiliate;



(B)

by a Sun Media Entity in the case of (b) above, will be less than or equal to the amount of interest payable in respect of the loan made to such Affiliate; or



(C)

by a Sun Media Entity in the case of (c) above, will be equal to the amount of dividends in respect of the Preferred Shares issued by such Affiliate.

        "Back-to-Back Securities" means the Back-to-Back Preferred Shares or the Back-to-Back Debt or both, as the context requires.

        "Back-to-Back Transactions" means any of the transactions described under the definition of Back-to-Back Preferred Shares.

        "Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular "person" (as that term is used in Section 13(d)(3) of the Exchange Act), such "person" shall be deemed to have beneficial ownership of all securities that such "person" has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition.

        "Board of Directors" means:

(1)

with respect to a corporation, the board of directors of the corporation;



(2)

with respect to a partnership, the board of directors of the general partner of the partnership; and



(3)

with respect to any other Person, the board or committee of such Person serving a similar function.

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        "Canadian Taxing Authority" means any federal, provincial, territorial or other Canadian government or any authority or agency therein having the power to tax.

        "Capital Lease Obligation" means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at that time be required to be capitalized on a balance sheet in accordance with GAAP.

        "Capital Stock" means:

(1)

in the case of a corporation, corporate stock;



(2)

in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;



(3)

in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and



(4)

any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

        "Capital Stock Sale Proceeds" means the aggregate net cash proceeds received by Sun Media after the Issue Date:

(1)

as a contribution to the common equity capital or from the issue or sale of Equity Interests of Sun Media (other than Disqualified Stock or Back-to-Back Securities); or



(2)

from the issue or sale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of Sun Media that have been converted into or exchanged for such Equity Interests,

other than, in either (1) or (2), Equity Interests (or convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities) sold to a Subsidiary of Sun Media.

        "Cash Equivalents" means:

(1)

United States dollars or Canadian dollars;



(2)

investments in securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth, territory or province of the United States of America or Canada, or by any political subdivision or taxing authority thereof, and rated in the "R-1" category by the Dominion Bond Rating Service Limited;



(3)

certificates of deposit and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers' acceptances with maturities not exceeding one year and overnight bank deposits, in each case, with any domestic commercial bank having capital and surplus in excess of US$500.0 million;



(4)

repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (2) and (3) above entered into with any financial institution meeting the qualifications specified in clause (3) above;



(5)

commercial paper having the highest rating obtainable from Moody's Investors Service, Inc. or Standard & Poor's Rating Services and in each case maturing within one year after the date of acquisition or with respect to commercial paper in Canada, a rating in the "R-1" category by the Dominion Bond Rating Service Limited; and



(6)

money market funds at least 90% of the assets of which constitute Cash Equivalents of the kinds described in clauses (1) through (5) of this definition.

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        "Change of Control" means the occurrence of any of the following:

(1)

the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of Sun Media and its Restricted Subsidiaries, taken as a whole, to any "person" (as that term is used in Section 13(d)(3) of the Exchange Act) other than a Permitted Holder or a Related Party of a Permitted Holder;



(2)

the adoption of a plan relating to the liquidation or dissolution of Sun Media;



(3)

the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any Person, other than a Permitted Holder or a Related Party of a Permitted Holder, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of Sun Media, measured by voting power rather than number of shares; or



(4)

during any consecutive two year period, the first day on which individuals who constituted the Board of Directors of Sun Media as of the beginning of such two year period (together with any new directors who were nominated for election or elected to such Board of Directors with the approval of a majority of the individuals who were members of such Board of Directors, or whose nomination or election was previously so approved at the beginning of such two-year period) cease to constitute a majority of the Board of Directors of Sun Media.

        "Common Stock" of any Person means all Capital Stock of such Person that is generally entitled to (1) vote in the election of directors of such Person or (2) if such Person is not a corporation, vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the management and policies of such Person.

        "Consolidated Cash Flow" means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such period plus:

(1)

an amount equal to any extraordinary loss plus any net loss realized by such Person or any of its Restricted Subsidiaries in connection with an Asset Sale, to the extent such losses were deducted in computing such Consolidated Net Income; plus



(2)

provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was deducted in computing such Consolidated Net Income; plus



(3)

Consolidated Interest Expense of such Person and its Restricted Subsidiaries for such period to the extent that any such expense was deducted in computing such Consolidated Net Income; plus



(4)

depreciation, amortization (including amortization of goodwill and other intangibles) and other non-cash expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period) of such Person and its Restricted Subsidiaries for such period, to the extent that such depreciation, amortization and other non-cash expenses were deducted in computing such Consolidated Net Income; minus



(5)

any interest and other payments made to Persons other than any Sun Media Entity in respect of Back-to-Back Securities or the Existing Back-to-Back Debt to the extent such interest and other payments were not deducted in computing such Consolidated Net Income; minus



(6)

non-cash items increasing such Consolidated Net Income for such period, other than the accrual of revenue in the ordinary course of business,

in each case, on a consolidated basis and determined in accordance with GAAP.

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        Notwithstanding the preceding, the provision for taxes based on the income or profits of, and the depreciation and amortization and other non-cash charges of a Restricted Subsidiary of Sun Media shall be added to Consolidated Net Income to compute Consolidated Cash Flow of Sun Media only to the extent that a corresponding amount would be permitted at the date of determination to be dividended to Sun Media by such Restricted Subsidiary without prior governmental approval (unless such approval has been obtained), and without direct or indirect restriction pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to that Restricted Subsidiary or its shareholders.

        "Consolidated Indebtedness" means, with respect to any Person as of any date of determination, the sum, without duplication, of (1) the total amount of Indebtedness of such Person and its Restricted Subsidiaries, plus (2) the total amount of Indebtedness of any other Person, to the extent that such Indebtedness has been guaranteed by the referent Person or one or more of its Restricted Subsidiaries, plus (3) the aggregate liquidation value of all Disqualified Stock of such Person and all Preferred Shares of Restricted Subsidiaries of such Person, in each case, determined on a consolidated basis in accordance with GAAP.

        "Consolidated Interest Expense" means, with respect to any Person, for any period, without duplication, the sum of (1) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued (including, without limitation, amortization of original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts, and other fees, and charges incurred in respect of letter of credit or bankers' acceptance financings), all calculated after taking into account the effect of all Hedging Obligations, (2) the consolidated interest expense of such Person and its Restricted Subsidiaries that was capitalized during such period, (3) any interest expense on Indebtedness of another Person that is guaranteed by such Person or any of its Restricted Subsidiaries or secured by a Lien on assets of such Person or any of its Restricted Subsidiaries (whether or not such guarantee or Lien is called upon), (4) the product of (a) all dividend payments on any series of Preferred Shares of such Person or any of its Restricted Subsidiaries, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state, provincial, territorial and local statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP, and (5) to the extent not included in clause (4) above for purposes of GAAP, the product of (a) all dividend payments on any series of Disqualified Stock of such Person or any of its Restricted Subsidiaries, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state, provincial, territorial and local statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP. Interest and other payments on Back-to-Back Securities or the Existing Back-to-Back Debt will not be included as Consolidated Interest Expense.

        "Consolidated Net Income" means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided, however, that:

(1)

the Net Income (but not loss) of any Person that is not a Restricted Subsidiary (other than an Unrestricted Subsidiary) or that is accounted for by the equity method of accounting shall be included; provided, that the Net Income shall be included only to the extent of the amount of dividends or distributions paid in cash to the specified Person or a Restricted Subsidiary thereof;



(2)

the Net Income of any Restricted Subsidiary shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of

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that Net Income is not at the date of determination permitted without any prior governmental approval (unless such approval has been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary or its shareholders;

(3)

the Net Income of any Person acquired in a pooling of interests transaction for any period prior to the date of such acquisition shall be excluded;



(4)

the cumulative effect of a change in accounting principles shall be excluded;



(5)

the Net Income (but not loss) of any Unrestricted Subsidiary shall be excluded, whether or not distributed to the specified Person or one of its Subsidiaries; provided, however, that for purposes of the covenants described under the captions "—Covenants—Restricted Payments" and "—Incurrence of Indebtedness and Issuance of Preferred Shares," the Net Income of any Unrestricted Subsidiary will be included to the extent it would otherwise be included under clause (1) of this definition; and



(6)

any non-cash compensation expense realized for grants of performance shares, stock options or other rights officers, directors and employees of Sun Media or any Restricted Subsidiary shall be excluded, provided that such shares, options or other rights can be redeemed at the option of the holders thereof for Capital Stock of Sun Media (other than Disqualified Stock).

        "Consolidated Revenues" means the gross revenues of Sun Media and its Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided that (1) any portion of gross revenues derived directly or indirectly from Unrestricted Subsidiaries, including dividends or distributions from Unrestricted Subsidiaries, shall be excluded from such calculation, and (2) any portion of gross revenues derived directly or indirectly from a Person (other than a Subsidiary of Sun Media or one of its Restricted Subsidiaries) accounted for by the equity method of accounting shall be included in such calculation only to the extent of the amount of dividends or distributions actually paid to Sun Media or a Restricted Subsidiary by such Person.

        "Credit Facilities" means, one or more debt facilities (including, without limitation, the New Credit Facility) or commercial paper facilities, in each case with banks or other institutional lenders providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables) or letters of credit, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.

        "Currency Exchange Protection Agreement" means, in respect of a Person, any foreign exchange contract, currency swap agreement, currency option or other similar agreement or arrangement designed to protect such Person against fluctuations in currency exchange rates entered into with any commercial bank or other financial institutions having capital and surplus in excess of US$500.0 million.

        "Debt to Cash Flow Ratio" means, as of any date of determination (the "Determination Date"), the ratio of (a) the Consolidated Indebtedness of Sun Media as of such Determination Date to (b) the Consolidated Cash Flow of Sun Media for the most recently ended four full fiscal quarters ending immediately prior to such Determination Date for which interim financial statements are available (each, a "Measurement Period" and, together, the "Measurement Periods"), determined on a pro forma basis after giving effect to all acquisitions or dispositions of assets made by Sun Media and its Restricted Subsidiaries from the beginning of such quarter through and including such Determination Date (including any related financing transactions) as if such acquisitions and dispositions had occurred at the beginning of such quarter. For purposes of calculating Consolidated Cash Flow for each Measurement Period immediately prior to the relevant Determination Date, (1) any Person that is a Restricted Subsidiary on the Determination Date (or would become a Restricted Subsidiary on such

115

Determination Date in connection with the transaction that requires the determination of such Consolidated Cash Flow) will be deemed to have been a Restricted Subsidiary at all times during the applicable Measurement Period; (2) any Person that is not a Restricted Subsidiary on such Determination Date (or would cease to be a Restricted Subsidiary on such Determination Date in connection with the transaction that requires the determination of such Consolidated Cash Flow) will be deemed not to have been a Restricted Subsidiary at any time during the applicable Measurement Period; (3) if Sun Media or any of its Restricted Subsidiaries shall have in any manner (A) acquired (including through an Asset Acquisition or the commencement of activities constituting such operating business) or (B) disposed of (including by way of an Asset Sale or the termination or discontinuance of activities constituting such operating business) any operating business during the applicable Measurement Period or after the end of such period and on or prior to such Determination Date, such calculation will be made on a pro forma basis in accordance with generally accepted accounting principles consistently applied, as if, in the case of an Asset Acquisition or the commencement of activities constituting such operating business, all such transactions had been consummated on the first day of the applicable Measurement Period, and, in the case of an Asset Sale or termination or discontinuance of activities constituting such operating business, all such transactions had been consummated prior to the first day of the applicable Measurement Period; (4) if (A) since the beginning of the applicable Measurement Period, Sun Media or any Restricted Subsidiary has incurred any Indebtedness that remains outstanding or has repaid any Indebtedness, or (B) the transaction giving rise to the need to calculate the Debt to Cash Flow Ratio is an incurrence or repayment of Indebtedness, Consolidated Interest Expense for such Measurement Period shall be calculated after giving effect on a pro forma basis to such incurrence or repayment as if such Indebtedness was incurred or repaid on the first day of such period, provided that, in the event of any such repayment of Indebtedness, Consolidated Cash Flow for such period shall be calculated as if Sun Media or such Restricted Subsidiary had not earned any interest income actually earned during such period in respect of the funds used to repay such Indebtedness; and (5) if any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest expense on such Indebtedness shall be calculated as if the base interest rate in effect for such floating rate of interest on the date of determination had been the applicable base interest rate for the entire period (taking into account any interest rate agreement applicable to such Indebtedness if such interest rate agreement has a remaining term in excess of twelve months).

        "Default" means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.

"Deferred Management Fees" means, for any period, any Management Fees that were payable during any prior period, the payment of which was not effected when due.

        "Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is 91 days after the date on which the notes mature. Notwithstanding the preceding sentence, (1) Back-to-Back Preferred Shares will not constitute Disqualified Stock and (2) any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require Sun Media to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that Sun Media may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with the covenant described under the caption "—Covenants—Restricted Payments."

        "Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

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        "Equity Offering" means an offering by Sun Media of Equity Interests (other than Disqualified Stock or Back-to-Back Securities) however designated and whether voting or non-voting or an equity contribution by a direct or indirect parent company to the common equity of Sun Media.

"Exchange Notes" has the meaning set forth in the registration rights agreement.

        "Existing Back-to-Back Debt" means each of the 12.15% Convertible Obligation due July 14, 2007 and 12.15% Convertible Obligation due November 28, 2008 of Sun Media; the 12.25% Convertible Obligation due July 14, 2007 of Bowes Publishers Limited; and the 12.25% Convertible Obligation due November 28, 2008 of Sun Media (Toronto), in each case in aggregate principal amount outstanding on the Issue Date and with respect to which each party thereto, other than the Sun Media Entities, has executed a subordination agreement in favor of the holders of the notes in substantially the form attached as an exhibit to the indenture.

        "Existing Back-to-Back Securities" means the Existing Back-to-Back Debt and the Existing Quebecor Preferred Shares.

        "Existing Indebtedness" means Indebtedness of Sun Media and its Restricted Subsidiaries (other than Indebtedness under the New Credit Facility) in existence on the Issue Date, until such amounts are repaid.

        "Existing Quebecor Preferred Shares" means the 12.50% Cumulative First Preferred Shares, Series A, of Quebecor Media Inc. in aggregate liquidation amount outstanding on the Issue Date.

        "GAAP" means generally accepted accounting principles consistently applied as in effect in Canada from time to time.

        "Government Securities" means direct obligations of, or obligations guaranteed by, either the United States of America or Canada, and the payment for which either the United States or Canada pledges its full faith and credit.

        "guarantee" means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business, direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any Indebtedness.

        "Hedging Obligations" means, with respect to any specified Person, the obligations of such Person pursuant to any Interest Rate Agreement or Currency Exchange Protection Agreement.

        "Indebtedness" means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent:

(1)

representing principal of and premium, if any, in respect of borrowed money;



(2)

representing principal of and premium, if any, evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);



(3)

in respect of banker's acceptances;



(4)

representing Capital Lease Obligations of such Person and all Attributable Debt in respect of sale and leaseback transactions entered into by such Person;



(5)

representing the balance deferred and unpaid of the purchase price of any property, except any such balance that constitutes an accrued expense or trade payable;



(6)

representing the amount of all obligations of such Person with respect to the repayment of any Disqualified Stock or, with respect to any Subsidiary of such Person, any Preferred Stock (but excluding, in each case, any accrued dividends); or



(7)

representing any Hedging Obligations,

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if and to the extent any of the preceding items (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of the specified Person prepared in accordance with GAAP. In addition, the term "Indebtedness" includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of any indebtedness of any other Person. The term "Indebtedness" will not include Back-to-Back Securities or the Existing Back-to-Back Securities.

        The amount of any Indebtedness outstanding as of any date shall be:

(1)

the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount, and



(2)

the principal amount thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Indebtedness;

provided, however, that the amount of any Indebtedness denominated in a currency other than Canadian dollars will be adjusted to the extent of any positive or negative (to the extent the obligation under such Currency Exchange Protection Agreement is not otherwise included as Indebtedness of such Person) value of any Currency Exchange Protection Agreement relating to any such Indebtedness.

        "Interest Rate Agreement" means, for any Person, any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement or other similar agreement or arrangement designed to protect against fluctuations in interest rates entered into with any commercial bank or other financial institution having capital and surplus in excess of US$500.0 million.

        "Investments" means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates) in the forms of loans (including guarantees or other obligations), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP and include the designation of a Restricted Subsidiary as an Unrestricted Subsidiary. If Sun Media or any of its Restricted Subsidiaries sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary of Sun Media such that, after giving effect to any such sale or disposition, such Person is no longer a Subsidiary of Sun Media, Sun Media shall be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of such Subsidiary so sold or disposed of in an amount determined as provided in the third paragraph of the covenant described under the caption "—Covenants—Restricted Payments." The acquisition by Sun Media or any Restricted Subsidiary of Sun Media of a Person that holds an Investment in a third Person will be deemed to be an Investment by Sun Media or such Restricted Subsidiary in such third Person in an amount equal to the fair market value of the Investment held by the acquired Person in such third Person in an amount determined as provided in the third paragraph of the covenant described under the caption "—Covenants—Restricted Payments."

"Issue Date" means February 7, 2003.

        "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest, hypothecation, assignment for security or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or capital lease or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.

118

        "Management Fees" means any amounts payable by Sun Media or any Restricted Subsidiary in respect of management or similar services.

        "Net Income" means, with respect to any specified Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of Preferred Shares dividends, excluding, however:

(1)

any gain (but not loss), together with any related provision for taxes on such gain (but not loss), realized in connection with: (a) any Asset Sale or (b) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and



(2)

any extraordinary gain (but not loss), together with any related provision for taxes on such extraordinary gain (but not loss).

        "Net Proceeds" means the aggregate cash proceeds received by Sun Media or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of (1) the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, and sales commissions, (2) any relocation expenses incurred as a result of the Asset Sale, (3) taxes paid or payable as a result of the Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, (4) amounts required to be applied to the repayment of Indebtedness, other than Indebtedness under a Credit Facility, secured by a Lien on the asset or assets that were the subject of such Asset Sale, (5) any reserve for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP, and (6) all distributions and other payments required to be made to minority interest holders in Subsidiaries or joint ventures of Sun Media or such Restricted Subsidiary as a result of such Asset Sale; provided, however, that the proceeds from the sale, transfer or other disposition of all of the outstanding Capital Stock or all or substantially all of the assets of Toronto Sun International, Inc. within 180 days of the Issue Date shall not constitute Net Proceeds.

        "New Credit Facility" means the credit facility between Sun Media, Bank of America, N.A., Banc of America Securities LLC and Credit Suisse First Boston Corporation, as lead arrangers, Bank of America, N.A., as administrative agent, and the lenders thereto to be entered into on or prior to the Issue Date.

        "Non-Recourse Debt" means Indebtedness:

(1)

as to which neither Sun Media nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise or (c) constitutes the lender;



(2)

no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness (other than the notes) of Sun Media or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its Stated Maturity; and



(3)

as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of Sun Media or any of its Restricted Subsidiaries.

        "Obligations" means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.

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        "Permitted Business" means the business conducted by Sun Media and its Subsidiaries on the date of the indenture or anything related or ancillary thereto.

        "Permitted Holders" means one or more of the following persons or entities:

(1)

Quebecor Inc.;



(2)

Quebecor Media Inc.;



(3)

any issue of the late Pierre Péladeau;



(4)

any trust having as its sole beneficiaries one or more of the persons listed in clause (3) above;



(5)

any corporation, partnership or other entity controlled by one or more of the persons or trusts referred to in clause (3) or (4) above or in this clause (5); and



(6)

Capital Communications CDPQ Inc.

        "Permitted Investments" means:

(1)

any Investment in Sun Media or in a Restricted Subsidiary of Sun Media;



(2)

any Investment in cash or Cash Equivalents;



(3)

any Investment by Sun Media or any of its Restricted Subsidiaries in a Person, if as a result of such Investment:



(a)

such Person becomes a Restricted Subsidiary of Sun Media; or



(b)

such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, Sun Media or any of its Restricted Subsidiaries,

provided that, in each case, such Person's primary business is a Permitted Business;

(4)

any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the covenant described under the caption "—Repurchase at the Option of Holders—Asset Sales;"



(5)

any acquisition of assets solely in exchange for the issuance of Equity Interests (other than Disqualified Stock or Back-to-Back Securities) of Sun Media;



(6)

Hedging Obligations entered into in the ordinary course of business of Sun Media or any of its Restricted Subsidiaries and not for speculative purposes;



(7)

loans and advances to officers, directors and employees of Sun Media and the Restricted Subsidiaries for business-related travel expenses, moving expenses and other similar expenses in each case incurred in the ordinary course of business not to exceed US$2.5 million outstanding at any time;



(8)

any Investment in connection with Back-to-Back Transactions;



(9)

any Investment existing on the Issue Date;



(10)

other Investments in any Person engaged in a Permitted Business having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (10) since the Issue Date not to exceed US$25.0 million; and



(11)

other Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value),

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when taken together with all other Investments made pursuant to this clause (11) since the Issue Date not to exceed US$10.0 million.

        "Permitted Liens" means:

(1)

Liens of Restricted Subsidiaries of Sun Media securing Indebtedness and other Obligations of Restricted Subsidiaries of Sun Media under Credit Facilities, which Indebtedness was permitted by the terms of the indenture to be incurred, provided, however, that the aggregate principal amount of such Indebtedness secured by such Liens shall not exceed an aggregate of (a) US$230.0 million and (b) Cdn$75.0 million at any one time outstanding;



(2)

Liens in favor of Sun Media or a Restricted Subsidiary;



(3)

Liens on property of a Person existing at the time such Person is merged with or into or consolidated with Sun Media or any Restricted Subsidiary of Sun Media, provided that such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with Sun Media or the Restricted Subsidiary;



(4)

Liens on property existing at the time of acquisition thereof by Sun Media or any of its Restricted Subsidiaries, provided that such Liens were in existence prior to the contemplation of such acquisition and do not extend to any assets other than such property;



(5)

Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business;



(6)

Liens to secure Indebtedness (including Capital Lease Obligations) permitted by clause (4) of the second paragraph of the covenant described under the caption "—Covenants—Incurrence of Indebtedness and Issuance of Preferred Shares" covering only the assets acquired with such Indebtedness;



(7)

Liens existing on the Issue Date;



(8)

Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded, provided that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefor;



(9)

Liens securing Permitted Refinancing Indebtedness, provided that any such Lien does not extend to or cover any property, Capital Stock or Indebtedness other than the property, shares or debt securing the Indebtedness so refunded, refinanced or extended;



(10)

attachment or judgment Liens not giving rise to a Default or an Event of Default;



(11)

Liens incurred or deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of social security;



(12)

Liens incurred or deposits made to secure the performance of tenders, bids, leases, statutory or regulatory obligations, bankers' acceptance, surety and appeal bonds, government contracts, performance and return-of-money bonds and other obligations of a similar nature incurred in the ordinary course of business, exclusive of Obligations for the payment of borrowed money;



(13)

Liens of franchisors or other regulatory bodies arising in the ordinary course of business;



(14)

Liens securing reimbursement obligations with respect to letters of credit that encumber documents and other property relating to such letters of credit and the products and proceeds thereof;

121

(15)

Liens encumbering customary initial deposits and margin deposits, and other Liens that are within the general parameters customary in the industry and incurred in the ordinary course of business, in each case, securing Indebtedness under Hedging Obligations and forward contracts, options, future contracts, future options or similar agreements or arrangements, including mark-to-market transactions designed solely to protect Sun Media or any of its Restricted Subsidiaries from fluctuations in interest rates, currencies or the price of commodities;



(16)

Liens consisting of any interest or title of licensor in the property subject to a license;



(17)

Liens on the Capital Stock of Unrestricted Subsidiaries;



(18)

Liens arising from sales or other transfers of accounts receivable which are past due or otherwise doubtful of collection in the ordinary course of business;



(19)

Liens securing Indebtedness permitted to be incurred under clause (12) of the second paragraph of the covenant described under the caption "—Covenants—Incurrence of Indebtedness and Issuance of Preferred Shares;"



(20)

any extensions, substitutions, replacements or renewals of the foregoing clauses (1) through (19); and



(21)

Liens incurred in the ordinary course of business of Sun Media or any Restricted Subsidiary of Sun Media with respect to Obligations that do not exceed US$25.0 million at any one time outstanding.

        "Permitted Refinancing Indebtedness" means any Indebtedness of Sun Media or any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund other Indebtedness of Sun Media or any Subsidiary Guarantor (other than intercompany Indebtedness); provided, however, that:

(1)

the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded (plus all accrued interest thereon and the amount of all expenses and premiums incurred in connection therewith);



(2)

such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded;



(3)

if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the notes, such Permitted Refinancing Indebtedness is subordinated in right of payment to, the notes on terms at least as favorable to the holders of notes as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded; and



(4)

such Indebtedness is incurred either by Sun Media or by the Restricted Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded.

        "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity.

        "Preferred Shares" means any Capital Stock of a Person, however designated, which entitles the holder thereof to a preference with respect to the payment of dividends, or as to the distribution of

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assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of any other class of Capital Stock issued by such Person.

        "Related Party" means:

(1)

any controlling shareholder, 80% (or more) owned Subsidiary, or immediate family member (in the case of an individual) of any Permitted Holder, or



(2)

any trust, corporation, partnership or other entity, the beneficiaries, shareholders, partners, owners or Persons beneficially holding an 80% or more controlling interest of which consist of any one or more Permitted Holder and/or such other Persons referred to in the immediately preceding clause (1).

        "Restricted Investment" means an Investment other than a Permitted Investment.

        "Restricted Subsidiary" of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary.

        "Significant Subsidiary" means any Subsidiary that would be a "significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date hereof.

        "Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which such payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

        "Subordinated Indebtedness" means any Indebtedness of Sun Media or its Subsidiaries (whether outstanding on the Issue Date or thereafter incurred) that is subordinate or junior in right of payment to the notes pursuant to a written agreement to that effect.

        "Subsidiary" means, with respect to any specified Person:

(1)

any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and



(2)

any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are such Person or one or more Subsidiaries of such Person (or any combination thereof).

        "Subsidiary Guarantee" means a Guarantee on the terms set forth in the indenture by a Subsidiary Guarantor of Sun Media obligations with respect to the notes.

        "Subsidiary Guarantor" means Restricted Subsidiary and any other Person that becomes a Subsidiary Guarantor pursuant to the covenant described under "—Covenants—Future Guarantors" or who otherwise executes and delivers a supplemental indenture to the trustee providing for a Subsidiary Guarantee.

        "Sun Media Entity" means any of Sun Media or any Subsidiary Guarantor.

        "Tax" means any tax, duty, levy, impost, assessment or other governmental charge (including penalties, interest and any other liabilities related thereto).

"Tax Benefit Transaction" means, for so long as Sun Media is a direct or indirect Subsidiary of Quebecor Inc., any transaction between a Sun Media Entity and Quebecor Inc. or any of its Affiliates,

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the primary purpose of which is to create tax benefits for any Sun Media Entity or for Quebecor Inc. or any of its Affiliates; provided, however, that (1) the Sun Media Entity involved in the transaction obtains a favorable tax ruling from a competent tax authority or a favorable tax opinion from a nationally recognized Canadian law or accounting firm having a tax practice of national standing as to the tax efficiency of the transaction for such Sun Media Entity; (2) Sun Media delivers to the trustee (a) a resolution of the Board of Directors of Sun Media to the effect the transaction will not prejudice the noteholders and certifying that such transaction has been approved by a majority of the disinterested members of such Board of Directors and (b) an opinion as to the fairness to such Sun Media Entity of such transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada; (3) such transaction is set forth writing; and (4) the Consolidated Cash Flow of Sun Media is not reduced after giving pro forma effect to the transaction as if the same had occurred at the beginning of the most recently ended four fiscal quarter period of Sun Media for which internal financial statements are available; provided, however, that if such transaction shall thereafter cease to satisfy the preceding requirements as a Tax Benefit Transaction, it shall thereafter cease to be a Tax Benefit Transaction for purposes of the indenture and shall be deemed to have been effected as of such date and, if the transaction is not otherwise permitted by the indenture as of such date, Sun Media will be in default under the indenture if such transaction does not comply with the preceding requirements or is not otherwise unwound within 30 days of that date.

"Unrestricted Subsidiary" means:

(1)

any Subsidiary of Sun Media that is designated after the Issue Date as an Unrestricted Subsidiary as permitted or required pursuant to the covenant described under the caption "—Covenants—Designation of Restricted and Unrestricted Subsidiaries" and is not thereafter redesignated as a Restricted Subsidiary as permitted pursuant thereto; and



(2)

any Subsidiary of an Unrestricted Subsidiary.

        "Voting Stock" of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

        "Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing:

(1)

the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by



(2)

the then outstanding principal amount of such Indebtedness.

        "Wholly Owned Restricted Subsidiary" of any specified Person means a Restricted Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors' qualifying shares) will at the time be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries of such Person.

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TAX CONSIDERATIONS

U.S. Federal Income Tax Considerations

        Based on the advice of Arnold & Porter, the following is a summary of certain U.S. federal income tax consequences applicable to an investment in the notes by a "U.S. Holder" who acquires the notes pursuant to this offering. This summary is based upon the Internal Revenue Code of 1986, as amended, which we refer to as the Code, Treasury Regulations, Internal Revenue Service rulings and judicial decisions now in effect. All of these are subject to change, possibly with retroactive effect, or different interpretations. For purposes of this summary, "U.S. Holder" means the beneficial holder of a note who or that for U.S. federal income tax purposes is:

•

an individual citizen or resident alien of the United States;



•

a corporation, partnership or other entity treated as such formed in or under the laws of the United States or any political subdivision of the United States;



•

an estate the income of which is subject to U.S. federal income taxation regardless of its source; or



•

a trust if a court within the United States is able to exercise primary supervision over the administration of such trust and one or more "U.S. persons" (within the meaning of the Code) have the authority to control all substantial decisions of the trust, or if a valid election is in effect to be treated as a U.S. person.

        This summary does not cover all aspects of U.S. federal income taxation that may be relevant to particular U.S. Holders in light of their specific circumstances (for example, U.S. Holders subject to the alternative minimum tax provisions of the Code) or to investors that may be subject to special treatment under U.S. federal income tax law, including:

•

dealers in stocks, securities or currencies;



•

securities traders that use a mark-to-market accounting method;



•

banks;



•

insurance companies;



•

tax-exempt organizations;



•

persons holding notes as part of a hedging or conversion transaction or a straddle;



•

persons deemed to sell notes under the constructive sale provisions of the Code;



•

persons whose functional currency is not the U.S. dollar; and



•

direct, indirect or constructive owners of 10% or more of our outstanding voting shares.

        The summary also does not discuss any aspect of state, local or foreign law, or U.S. federal estate and gift tax law as applicable to U.S. Holders. In addition, it is limited to U.S. Holders who purchase and hold the notes as "capital assets" within the meaning of the Code, generally, property held for investment.

        Except as used in "—Exchange of Notes into Exchange Notes" below, when "note" and "notes" are used in this summary, they also refer to "Exchange Note" and "Exchange Notes."

You should consult your own tax advisor regarding the federal, state, local and foreign tax consequences of the purchase, ownership and disposition of the notes.

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Interest on the Notes

        Stated interest on the notes will be taxable to a U.S. Holder as ordinary income at the time it is received or accrued, in accordance with the U.S. Holder's method of accounting for tax purposes. Interest on the notes will constitute income from sources outside the United States and, with certain exceptions, will be "passive" or "financial services" income, which is treated separately from other types of income for purposes of computing the foreign tax credit allowable to a U.S. Holder under the federal income tax laws.

Redemption

        In the event of a Change of Control, the U.S. Holders will have the right to require us to purchase their notes. Under the Treasury Regulations, the right of U.S. Holders to require redemption of the notes upon the occurrence of a Change of Control will not affect the yield to maturity of the notes if the likelihood of the occurrence, as of the date the notes are issued, is remote. We believe that the likelihood of a Change of Control is remote under this rule, and therefore we will not treat this possibility as affecting the yield to maturity of the notes.

        We may redeem the notes at any time on or after a certain date, and, in certain circumstances, we may redeem or repurchase a portion of the notes at any time prior to a certain date. Under the Treasury Regulations, we will be deemed to exercise any option to redeem the notes if the exercise of such option would lower the yield of the notes. We believe, and will take the position for all U.S. federal income tax purposes, that we will not be treated as having exercised the option to redeem the notes under these rules.

Sale, Exchange or Retirement of a Note

        A U.S. Holder generally will recognize gain or loss upon the sale, exchange, redemption, retirement or other disposition of a note, measured by the difference, if any, between:

•

the amount of cash and the fair market value of any property received, except to the extent that the cash or other property is attributable to the payment of accrued interest not previously included in income, which amount will be taxable as ordinary income; and



•

the holder's tax basis in the notes.

        Any such gain or loss will generally be capital gain or loss and will generally be long-term capital gain or loss if the note has been held or deemed held for more than twelve months at the time of the disposition. Net capital gains of individuals may be taxed at lower rates than items of ordinary income. The ability of a U.S. Holder to offset capital losses against ordinary income is limited. Any gain or loss recognized by a U.S. Holder on the sale or other disposition of a note generally will be treated as income from sources within the United States or loss allocable to income from sources within the United States. Any loss attributable to accrued but unpaid interest will be allocated against income of the same category and source as the interest on the notes. A U.S. Holder's tax basis in a note will generally equal its cost to the U.S. Holder.

Exchange of Notes Into Exchange Notes

        The exchange of a note for an Exchange Note by a holder pursuant to the Registered Exchange Offer will not constitute a taxable exchange for U.S. federal income tax purposes. A U.S. Holder will not recognize any gain or loss upon the receipt of an Exchange Note pursuant to the Registered Exchange Offer and a U.S. Holder will be required to continue to include interest on the Exchange Note in gross income in the manner and to the extent described in this prospectus. A U.S. Holder's holding period for an Exchange Note will include his or its holding period for the original note exchanged pursuant to the Registered Exchange Offer, and such U.S. Holder's basis in the Exchange

126

Note immediately after the exchange will be the same as his or its basis in such original note immediately before the exchange.

Information Reporting and Backup Withholding

        A U.S. Holder of the notes may be subject to "backup withholding" with respect to certain "reportable payments," including interest payments and, under certain circumstances, principal payments on the notes. These backup withholding rules apply if the Holder, among other things:

•

fails to furnish a social security number or other taxpayer identification number ("TIN") certified under penalty of perjury within a reasonable time after the request for the TIN;



•

furnishes an incorrect TIN;



•

fails to report properly interest or dividends; or



•

under certain circumstances, fails to provide a certified statement, signed under penalties of perjury, that the TIN furnished is the correct number and that such holder is not subject to backup withholding.

        A U.S. Holder that does not provide us with its correct TIN also may be subject to penalties imposed by the Internal Revenue Service (the "IRS"). Any amount withheld from a payment to a U.S. Holder under the backup withholding rules is creditable against the U.S. Holder's federal income tax liability, provided that the required information is furnished to the IRS. Backup withholding will not apply, however, with respect to payments made to certain U.S. Holders, including corporations and tax-exempt organizations, provided their exemptions from backup withholding are properly established.

        We will report to the U.S. Holders of notes and to the IRS the amount of any "reportable payments" for each calendar year and the amount of tax withheld, if any, with respect to these payments.

Canadian Federal Income Tax Considerations for Non-Residents of Canada

        In the opinion of Ogilvy Renault, Canadian counsel for Sun Media Corporation, the following summary fairly describes the main Canadian federal income tax consequences applicable to you if you exchange old notes for new notes pursuant to the exchange offer or if you invest, as initial purchaser, in the notes and, for purposes of the Income Tax Act (Canada) (the "Act"), you hold such notes as capital property. This summary is based on the relevant provisions of the Act and the Regulations thereunder (the "Regulations") and counsel's understanding of the administrative practices of the Canada Customs and Revenue Agency. It assumes that the specific proposals to amend the Act and the Regulations publicly announced by the Minister of Finance of Canada prior to the date of this prospectus are enacted in their present form, but the Act or the Regulations may not be amended as proposed or at all. This summary does not address provincial, territorial or foreign income tax considerations. Changes in the law or administrative practices or future court decisions may affect your tax treatment.

        The following commentary is generally applicable to a holder who, at all times for purposes of the Act, deals at arm's length with us, is not and is not deemed to be a resident of Canada during any taxation year in which it owns the notes and does not use or hold, and is not deemed to use or hold the notes in the course of carrying on a business in Canada and, in the case of a person who carries on an insurance business in Canada and elsewhere, establishes that the notes are not a "designated insurance property" and are not effectively connected with such insurance business carried on in Canada (a "Non-Resident Holder").

127

Interest Payments

        A Non-Resident Holder will not be subject to tax (including withholding tax) under the Act on interest, principal or premium on the notes.

Dispositions

        Gains realized on the disposition or deemed disposition of a note by a Non-Resident Holder will not be subject to tax under the Act.

Exchange of Old Notes for New Notes

        The exchange of an old note for a new note by a Non-Resident Holder pursuant to the exchange offer will not constitute a taxable transaction for the purposes of the Act.

The preceding discussion of federal income tax consequences is for general information only and is not tax advice. Accordingly, you should consult your own tax advisor as to particular tax consequences of purchasing, holding, and disposing of the notes, including the applicability and effect of any state, local or foreign tax laws, and of any proposed changes in applicable laws.

PLAN OF DISTRIBUTION

        Each broker-dealer that receives new notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of these new notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of new notes received in exchange for old notes where those old notes were acquired as a result of market-making activities or other trading activities. Under the registration rights agreement, we and the subsidiary guarantors have agreed that, starting on the expiration date and ending on the sooner of 180 days after the expiration date and the date on which all participating broker-dealers have sold all the new notes held by them, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any of these resales. In addition, until                        , 2003, all dealers effecting transactions in the new notes may be required to deliver a prospectus.

        We will not receive any proceeds from any sale of new notes by broker-dealers. New notes received by broker-dealers for their own account pursuant to the exchange offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the new notes or a combination of these methods of resale, at market prices prevailing at the time of resale, at prices related to these prevailing market prices or negotiated prices. Any of these resales may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any of these broker-dealers and/or the purchasers of any of these new notes. Any broker-dealer that resells new notes that were received by it for its own account pursuant to the exchange offer and any broker or dealer that participates in a distribution of these new notes may be deemed to be an "underwriter" within the meaning of the Securities Act and any profit of any of these resales of new notes and any commissions or concessions received by any of these persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act.

        For a period of 180 days after the expiration date, we and the subsidiary guarantors will promptly send additional copies of this prospectus and any amendment or supplement to this prospectus to any broker-dealer that requests those documents in the letter of transmittal. We have agreed to pay all expenses incident to the exchange offer (including the expenses of one counsel for the holders of the

128

old notes) other than commissions or concessions of any brokers or dealers and will indemnify the holders of the old notes (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act.

LEGAL MATTERS

        Ogilvy Renault, Montréal, Canada, will pass upon the validity of the new notes, and the accompanying subsidiary guarantees by the Canadian subsidiary guarantors, offered by this prospectus. Arnold & Porter, New York, New York, will pass upon the validity of the subsidiary guarantees by the U.S. subsidiary guarantors accompanying the new notes offered by this prospectus and provide an opinion as to the enforceability of the new notes under New York law. A partner of Ogilvy Renault is one of our directors, and another partner of Ogilvy Renault is a director of Quebecor Media and a director of Quebecor Inc.

INDEPENDENT AUDITORS

        Our consolidated balance sheets as at December 31, 2001 and 2002 and our consolidated statements of income, shareholder's equity and cash flows for the three years ended December 31, 2002 included in this prospectus have been audited by KPMG LLP, independent chartered accountants, as indicated in their report appearing in this prospectus.

WHERE YOU CAN FIND MORE INFORMATION

        We have filed with the SEC a registration statement on Form F-4 under the Securities Act with respect to the new notes offered in this prospectus. As permitted by SEC rules, this prospectus does not contain all of the information included in the registration statement (including its exhibits and schedules). You should read the registration statement (including its exhibits and schedules) for more information about us, the exchange offer and the new notes. This prospectus summarizes material provisions of contracts and other documents to which we refer you. Because this prospectus may not contain all the information that you find important, you should review the full text of these documents. We have filed these documents as exhibits to the registration statement.

        We are also subject to the reporting requirements of the Exchange Act. We file reports and other information with the SEC. The public may read and copy the registration statement (including its exhibits and schedules) and the reports and other information filed by us at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain information on the operation of the SEC's Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of this Internet site is http://www.sec.gov.

        In addition, you may obtain a copy of the documents to which we refer you in this prospectus without charge upon written or oral request to: Sun Media Corporation, 333 King Street East, Toronto, Ontario, Canada M5A 3X5, Attention: Vice President, Corporate Controller, telephone number (416) 947-2222. To obtain timely delivery, you must request these documents no later than five business days before the expiration date of the exchange offer. Unless extended, the expiration date is                    , 2003.

129

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130

INDEX TO HISTORICAL FINANCIAL STATEMENTS

	Page
Annual Financial Information as at December 31, 2001 and 2002 and for the Years Ended December 31, 2000, 2001 and 2002
Auditors' Report	F-2
Consolidated Statements of Income for the years ended December 31, 2000, 2001 and 2002	F-3
Consolidated Statements of Shareholder's Equity for the years ended December 31, 2000, 2001 and 2002	F-4
Consolidated Statements of Cash Flows for the years ended December 31, 2000, 2001 and 2002	F-5
Consolidated Balance Sheets as at December 31, 2001 and 2002	F-6
Notes to Consolidated Financial Statements for the years ended December 31, 2000, 2001 and 2002	F-7

F-1

AUDITORS' REPORT TO THE DIRECTORS
OF SUN MEDIA CORPORATION

        We have audited the consolidated balance sheets of Sun Media Corporation ("Sun Media" or the "Company") as at December 31, 2001 and 2002, and the consolidated statements of income, shareholder's equity, and cash flows for each of the years ended December 31, 2000, 2001 and 2002. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

        We conducted our audits in accordance with Canadian generally accepted auditing standards and United States generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.

        In our opinion, these consolidated financial statements present fairly, in all material respects, the financial position of Sun Media as at December 31, 2001 and 2002, and the results of its operations and its cash flows for each of the years ended December 31, 2000, 2001 and 2002 in accordance with Canadian generally accepted accounting principles.

Toronto, Canada
January 24, 2003, except as to note 19, which is as of February 7, 2003	/s/ KPMG LLP Chartered Accountants

F-2

SUN MEDIA CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

For the years ended December 31
(In thousands of Canadian dollars)

		2000		2001			2002
REVENUES		$	850,087	$	838,136		$	853,610
OPERATING EXPENSES
	Wages and employee benefits		319,541		313,378			318,046
	Newsprint		117,215		125,723			103,758
	Other operating expenses		208,004		198,191			209,473
			644,760		637,292			631,277
OPERATING INCOME BEFORE THE UNDERNOTED			205,327		200,844			222,333
Depreciation and amortization (note 1a)			46,671		47,259			27,035
Restructuring charges (note 2)			—		17,800			2,195
Financial expenses (note 3)			53,085		42,070			33,265
Dividend income (notes 5 and 15)			—		(95,342	)		(203,168	)
INCOME BEFORE INCOME TAXES AND NON-CONTROLLING INTEREST			105,571		189,057			363,006
Income taxes (note 4)			42,325		35,611			52,713
Non-controlling interest			972		968			1,118
NET INCOME		$	62,274	$	152,478		$	309,175

See accompanying notes to consolidated financial statements.

F-3

SUN MEDIA CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY

For the years ended December 31
(In thousands of Canadian dollars)

	Convertible Obligation (note 9)			Capital Stock (note 10)		Retained Earnings			Currency Translation Adjustment (note 11)			Total Shareholder's Equity
BALANCE—DECEMBER 31, 1999	$	—		$	301,801	$	33,433		$	(303	)	$	334,931
Net income		—			—		62,274			—			62,274
Currency translation		—			—		—			221			221
BALANCE—DECEMBER 31, 2000		—			301,801		95,707			(82	)		397,426
Net income		—			—		152,478			—			152,478
Dividends on capital stock (notes 10 and 15)		—			—		(45,359	)		—			(45,359	)
Currency translation		—			—		—			359			359
Issuance of convertible obligation		1,600,000			—		—			—			1,600,000
Interest on convertible obligation		92,673			—		(58,384	)		—			34,289
BALANCE—DECEMBER 31, 2001		1,692,673			301,801		144,442			277			2,139,193
Net income		—			—		309,175			—			309,175
Dividends on capital stock (notes 10 and 15)		—			—		(70,945	)		—			(70,945	)
Currency translation		—			—		—			(95	)		(95	)
Issuance of convertible obligation		350,000			—		—			—			350,000
Interest on convertible obligation		197,479			—		(128,434	)		—			69,045
Payment of interest on convertible obligation		(197,063	)		—		—			—			(197,063	)
Adjustment on related party transaction (note 12)		—			—		(230	)		—			(230	)
BALANCE—DECEMBER 31, 2002	$	2,043,089		$	301,801	$	254,008		$	182		$	2,599,080

See accompanying notes to consolidated financial statements.

F-4

SUN MEDIA CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the years ended December 31
(In thousands of Canadian dollars)

			2000			2001			2002
CASH PROVIDED BY (USED IN):
OPERATIONS
	Net Income		$	62,274		$	152,478		$	309,175
	Items not involving cash:
		Depreciation of fixed assets		25,396			25,692			26,880
		Amortization of goodwill and other assets		21,275			21,567			155
		Future income taxes		18,741			4,825			4,750
		Non-controlling interest		972			968			1,118
		Dividend income not received		—			(95,342	)		—
		Other		1,324			1,219			537
				129,982			111,407			342,615
Changes in non-cash operating working capital				4,045			29,176			57,657
Cash provided by operating activities				134,027			140,583			400,272
FINANCING
	Issuance of convertible obligations (note 9)			—			1,600,000			350,000
	Interest paid on convertible obligations (note 9)			—			—			(197,063	)
	Loans			50,294			63,068			1,844
	Repayment of loans			(162,658	)		(101,627	)		(39,085	)
	Dividends on capital stock (notes 10 and 15)			—			(45,359	)		(70,945	)
	Deferred financing cost			—			(1,400	)		(68	)
	Other			(1,128	)		(1,047	)		(1,118	)
Cash provided by (used in) financing activities				(113,492	)		1,513,635			43,565
INVESTING
	Investment in preferred shares of affiliated company (note 5)			—			(1,600,000	)		(350,000	)
	Business acquisitions, net of cash (note 12)			—			—			(756	)
	Dispositions, net of cash (note 12)			—			—			925
	Increase in short-term investments			—			—			(74,419	)
	Additions to fixed assets			(19,806	)		(19,207	)		(10,309	)
	Proceeds from disposal of fixed assets			192			719			2,600
	Other			(91	)		(9	)		—
Cash used in investing activities				(19,705	)		(1,618,497	)		(431,959	)
Increase in cash				830			35,721			11,878
Cash and cash equivalents—beginning of year				2,617			3,447			39,168
Cash and cash equivalents—end of year			$	3,447		$	39,168		$	51,046
CHANGES IN NON-CASH OPERATING WORKING CAPITAL
	Accounts receivable		$	6,389		$	1,247		$	(6,670	)
	Inventories			(1,412	)		544			1,510
	Accounts payable and accrued liabilities			942			(1,173	)		9,288
	Current tax benefit of interest on convertible obligation (note 9)			—			34,289			69,045
	Other			(1,874	)		(5,731	)		(15,516	)
			$	4,045		$	29,176		$	57,657

See accompanying notes to consolidated financial statements.

F-5

SUN MEDIA CORPORATION

CONSOLIDATED BALANCE SHEETS

As at December 31
(In thousands of Canadian dollars)

			2001		2002
ASSETS
CURRENT ASSETS
	Cash and cash equivalents		$	39,168	$	51,046
	Short-term investments			—		74,419
	Accounts receivable net of allowance for doubtful accounts of $3,918 (2001—$3,851)			110,371		117,041
	Dividend income receivable from Quebecor Media Inc. (notes 5 and 15)			95,342		95,771
	Income and other taxes receivable			—		16,192
	Inventories			12,010		10,500
	Prepaid expenses			3,507		4,000
	Future income taxes (note 4)			4,341		3,031
TOTAL CURRENT ASSETS				264,739		372,000
INVESTMENT IN AFFILIATED COMPANY (note 5)				1,600,000		1,950,000
FIXED ASSETS (note 6)				227,199		208,430
GOODWILL				751,735		751,317
FUTURE INCOME TAXES (note 4)				33,057		36,530
OTHER ASSETS (note 7)				21,316		17,615
TOTAL ASSETS			$	2,898,046	$	3,335,892
LIABILITIES
CURRENT LIABILITIES
	Accounts payable		$	39,841	$	29,819
	Accrued liabilities			69,167		88,477
	Income and other taxes			1,456		—
	Deferred subscription revenue			15,213		16,442
	Current portion of long-term debt (note 8)			5,000		60,000
TOTAL CURRENT LIABILITIES				130,677		194,738
LONG-TERM DEBT (note 8)				549,512		455,147
FUTURE INCOME TAXES (note 4)				38,981		45,984
OTHER LIABILITIES				37,845		39,105
NON-CONTROLLING INTEREST				1,838		1,838
TOTAL LIABILITIES				758,853		736,812
SHAREHOLDER'S EQUITY
	Convertible obligations (note 9)			1,692,673		2,043,089
	Capital stock (note 10)			301,801		301,801
	—Authorized: 10,000,000,000 Voting Class A common shares, nil par value
		10,000,000,000 Non-voting redeemable Class B preferred shares, nil par value
		10,000,000,000 Class C preferred shares, nil par value
	—Issued and outstanding at December 31, 2001 and 2002:
		1,261,000 Voting Class A common shares
	Retained earnings			144,442		254,008
	Translation adjustment (note 11)			277		182
TOTAL SHAREHOLDER'S EQUITY				2,139,193		2,599,080
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY			$	2,898,046	$	3,335,892
COMMITMENTS AND CONTINGENCIES (note 13)
SUBSEQUENT EVENT (note 19)

See accompanying notes to consolidated financial statements.

F-6

SUN MEDIA CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

For the years ended December 31, 2000, 2001 and 2002
(In thousands of Canadian dollars)

NATURE OF BUSINESS

        The primary operation of the Company is newspaper publishing. The Company publishes urban daily newspapers, community newspapers, as well as other specialty publications in communities across Canada and in the state of Florida in the United States. The Company is also active in the newspaper and magazine distribution business. In addition, the Company provides a range of commercial printing and other related services to third parties through its national network of production and printing facilities.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)  Principles of Consolidation

        The consolidated financial statements include the accounts of the Company and all its subsidiaries. The consolidated financial statements are prepared in conformity with generally accepted accounting principles in Canada. The material differences between generally accepted accounting principles in Canada and in the United States are described in note 18.

(b)  Estimates

        The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant areas requiring the use of management estimates relate to the determination of allowance for doubtful accounts, pension and other employee benefits, accruals for the restructuring of operations, the useful life of assets for depreciation, amortization and evaluation of net recoverable amount, provisions for income taxes and the determination of fair value of financial instruments. Consequently, actual results could differ from these estimates.

(c)  Revenue Recognition

        Circulation and advertising revenue from publishing activities is recognized in income when the publication is delivered. Prepaid subscription revenue is deferred and taken into income over the term of the subscription. Revenue from the distribution of publications and products is recognized upon delivery, net of provisions for estimated returns. Revenue from commercial printing contracts is recognized once the product is delivered.

        The Company evaluates its allowances for uncollectible trade accounts receivable based on customers' credit history, payment trends and other economic factors. Allowance for sales returns are based on the Company's historical rate of return.

(d)  Cash and Cash Equivalents and Short-term Investments

        Cash and cash equivalents and short-term investments consist of cash, term deposits, corporate commercial paper, banker's acceptances, and other highly liquid investments. Cash equivalents are purchased three months or less from maturity and are stated at amortized cost. Short-term investments are purchased three months or more from maturity. The short-term investments are considered to be held-to-maturity securities, and are stated at amortized cost.

F-7

(e)  Inventory Valuation

        Inventories, consisting primarily of newsprint and ink, are valued at the lower of cost, determined on a first-in, first-out basis, and market. Market is defined as replacement cost.

(f)    Fixed Assets

        Fixed assets are stated at cost and are depreciated over their estimated useful lives by charges to operations using the straight-line method. The rates of depreciation are as follows:

Buildings	25-40 years
Machinery and equipment	3-20 years

        Interest on debt relating to construction in progress and deposits on equipment is capitalized. Major improvements are capitalized, while maintenance and repairs are expensed when incurred. The Company regularly reviews the carrying values of its fixed assets by comparing the carrying amount of the asset to the expected future undiscounted cash flows to be generated by the asset. If the carrying value exceeds the amount recoverable, a write-down equal to the excess is charged to the consolidated statements of income.

(g)  Income Taxes

        The Company follows the asset and liability method of accounting for income taxes. Under the asset and liability method, future income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Future income tax assets and liabilities are measured using enacted or substantively enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on future income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment or substantively enactment date. Future income tax assets are recognized and if realization is not considered "more likely than not", a valuation allowance is provided.

(h)  Foreign Currency Translation

        Monetary assets and liabilities of Canadian operations denominated in foreign currencies are translated at the exchange rate in effect at the balance sheet date. Non-monetary assets and liabilities, revenue and expenses are translated at the exchange rate in effect at the transaction date.

        Foreign operations are in the United States and are of a self-sustaining nature. Assets and liabilities of the foreign operations are translated at the exchange rate in effect at the balance sheet date and revenue and expenses are translated at the weighted average exchange rates for the period.

        Gains and losses on the translation of foreign operations are shown as a separate component in shareholder's equity. All other exchange gains and losses are recognized currently in income.

F-8

(i)    Derivative Financial Instruments

        The Company uses certain derivative financial instruments to reduce the risk related to fluctuations in foreign currency exchange rates and interest rates. The Company does not hold or issue derivative financial instruments for trading purposes. Net receipts and payments on interest rate instruments are included in income as part of interest expense. Gains and losses associated with foreign exchange swap agreements are deferred and recognized in income in the same period as the income or expense arising from the corresponding hedged positions.

(j)    Employee Future Benefits

(i)

Pensions

Pension costs are determined using actuarial methods and are funded through contributions determined in accordance with the projected benefit method pro-rated on service. Pension expense is charged to operations and includes:

•

The cost of pension benefits provided in exchange for employees' services rendered during the year;



•

The amortization of the initial net transition asset on a straight-line basis over the expected average remaining service life of the employee group covered by the plans;



•

The amortization of prior service costs and amendments over the expected average remaining service life of the employee group covered by the plans; and



•

The interest cost of pension obligations, the return on pension fund assets, and the amortization of cumulative unrecognized net actuarial gains and losses in excess of 10% of the greater of the benefit obligation or fair value of plan assets over the expected average remaining service life of the employee group covered by the plans.




(ii)

Other Post-retirement Benefits

The Company accrues the cost of post-retirement benefits other than pensions. These benefits, which are funded by the Company as they become due, include life insurance programs and medical benefits. The Company amortizes the cumulative unrecognized net actuarial gains and losses in excess of 10% of the projected benefit obligation over the expected average remaining service life of the employee group covered by the plans.

(k)  Advertising and Marketing Costs

        Advertising costs, which include the Company's marketing expenses, are expensed as incurred. From time to time, the Company provides advertising services to customers from which the Company concurrently acquires advertising services. Revenue and expenses from advertising barter transactions are determined based on the fair value of the services provided by the Company for similar cash transactions. For the year ended December 31, 2002, the Company recorded $8,800 of barter advertising (2000—$9,900; 2001—$9,300).

F-9

1. CHANGES IN ACCOUNTING POLICIES

(a)  Goodwill and Intangible Assets

        In fiscal 2001, the Canadian Institute of Chartered Accountants ("CICA") issued section 3062, "Goodwill and Other Intangible Assets", of the CICA Handbook. Section 3062 requires that goodwill and intangible assets with indefinite lives no longer be amortized, but instead be tested for impairment at least annually by comparing the carrying value to the respective fair value. Section 3062 also requires that intangible assets with finite lives be amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment by assessing their fair values and comparing them to their carrying values. The Company has adopted the provisions of section 3062, effective January 1, 2002.

        In connection with section 3062's transitional goodwill impairment evaluation, the Company was required to assess whether goodwill was impaired as of January 1, 2002. The Company has completed the transitional goodwill impairment assessment and has determined that no impairment existed as of the date of adoption.

        At January 1, 2002, the Company had unamortized goodwill of $751,735, which is no longer being amortized. This change in accounting policy is not applied retroactively and the amounts presented for prior periods have not been restated for this change. If this change in accounting policy were applied retroactively to the consolidated statements of income, the impact of the change would be as follows:

	2000		2001
Net income	$	62,274	$	152,478
Add back goodwill amortization net of income taxes		19,838		20,142
Net income before goodwill amortization	$	82,112	$	172,620

(b)  Stock-based Compensation

        Effective January 1, 2002, the Company adopted the new CICA Handbook Section 3870, "Stock-based Compensation and Other Stock-based Payments", which establishes standards for the recognition, measurement, and disclosure of stock-based compensation and other stock-based payments made in exchange for goods and services provided by employees and non-employees. The Company accounts for all stock-based awards to employees that are direct awards of stock, that call for settlement in cash or other assets, or are stock appreciation rights that call for settlement by the issuance of cash or other assets by applying the fair-value based method.

        During the year ended December 31, 2002, certain employees of the Company were issued stock options, with respect to options plans established by Quebecor Media Inc. ("QMI") and Quebecor Inc. ("Quebecor"). The awards issued under these option plans call for settlement of the awards in cash, and as a result the Company has applied the fair-value method. Under the fair-value based method, compensation cost attributable to these awards is recognized over the vesting period in each year in operating expense. Changes in fair value between the grant date and the measurement date result in a change in the measure of compensation costs.

F-10

2. CHARGE FOR RESTRUCTURING OF OPERATIONS

        During 2002, the Company implemented restructuring initiatives, which resulted in the termination of approximately 60 employees throughout several divisions. As a result, the Company recorded a restructuring charge of $2,195 (or $1,471 net of taxes) for the year ended December 31, 2002 relating to severance and other personnel-related costs. Payments of $995 were made during the year, and as at December 31, 2002, a restructuring accrual of $1,200 was included in accrued liabilities.

        The Company implemented restructuring initiatives in the second and fourth quarters of 2001. The initiatives resulted in a work-force reduction charge of $17,800 in fiscal 2001, or $11,570 net of taxes. Employee terminations were made across all geographic regions and departments of the Company, and included employees at all levels. The work-force reduction costs consisted primarily of severance, benefit, and other personnel-related costs. Over 350 employees were terminated. All termination costs were paid by December 31, 2002.

        In addition, the Company has an accrual remaining of $7,158 at December 31, 2002 relating to restructuring initiatives that took place in 1994, 1996 and 1997. This accrual represents the residual liability with respect to future monthly payments the Company is required to make on these initiatives.

3. FINANCIAL EXPENSES

	2000			2001			2002
Interest on long-term debt (note 8)	$	51,965		$	40,732		$	31,352
Amortization of deferred financing costs		3,380			3,308			3,476
Amortization of fair market premium (note 8b)		(2,648	)		(2,124	)		(2,124	)
Other		439			551			561
		53,136			42,467			33,265
Interest capitalized to the cost of fixed assets		(51	)		(397	)		—
Total financial expenses	$	53,085		$	42,070		$	33,265
Cash interest payments	$	53,558		$	42,620		$	33,653
Cash interest receipts	$	1,807		$	1,965		$	1,206

F-11

4. INCOME TAXES

        The provision for income taxes differs from the amount that would have resulted by applying the combined Canadian federal and provincial statutory income tax rates to earnings as discussed below:

		2000			2001			2002
Income before income taxes and non-controlling interest		$	105,571		$	189,057		$	363,006
Less non-taxable dividend income			—			(95,342	)		(203,168	)
Income before income taxes, non-controlling interest and dividend income		$	105,571		$	93,715		$	159,838
Income tax provided at combined statutory rates of 40.79% (2000—41.82%; 2001—41.66%)			44,146			39,040			65,198
Increase (decrease) in taxes resulting from:
	Manufacturing and processing profits deduction		(7,004	)		(6,074	)		(9,845	)
	Non-deductible expenses		6,980			7,038			848
	Other		(1,797	)		(4,393	)		(3,488	)
Income taxes provided		$	42,325		$	35,611		$	52,713
Current		$	23,584		$	30,786		$	47,963
Future			18,741			4,825			4,750
		$	42,325		$	35,611		$	52,713
Net cash payments (receipts) for income taxes		$	27,986		$	3,499		$	(591	)

        In 2002, the Company also recorded a current tax benefit of $69,045 (2001—$34,289; 2000—$nil) relating to the interest on the convertible obligations charged to retained earnings (note 9).

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        The tax effects of significant items comprising the Company's net future income tax liability are as follows:

		2001			2002
Future income tax assets:
	Difference between book and tax bases of goodwill	$	18,136		$	13,269
	Operating loss carryforwards		6,820			3,593
	Employee future benefits		11,402			13,595
	Other		1,933			7,580
			38,291			38,037
Less valuation allowance			—			(1,259	)
			38,291			36,778
Future income tax liabilities:
	Differences between book and tax bases of fixed assets		(27,885	)		(25,762	)
	Other		(11,989	)		(17,439	)
			(39,874	)		(43,201	)
Net future income tax liability			(1,583	)		(6,423	)
Less net future income tax asset:
	Current		(4,341	)		(3,031	)
	Long-term		(33,057	)		(36,530	)
Net long-term future income tax liability		$	(38,981	)	$	(45,984	)

        The valuation allowance of $1,259 at December 31, 2002 relates to non-capital losses of $3,704 available for carryforward by a Canadian subsidiary of the Company, Communications Gratte-Ciel ltée ("Gratte-Ciel"). Subsequent recognition of the tax benefit relating to this valuation allowance, if any, would be reported in retained earnings.

        At December 31, 2002, US subsidiaries of the Company have tax losses available for carryforward of US $4,248 to be applied against taxable US income in future years. These losses will expire in varying amounts through December 31, 2010. The tax benefit of these losses has been recorded in the accounts since it is anticipated that sufficient income will be generated by the US subsidiaries to offset the losses within their carryforward period.

F-13

5. INVESTMENT IN AFFILIATED COMPANY

        On July 9, 2001, the Company invested in Cumulative First Preferred Series A Shares of its parent, QMI, at a cost of $1,600,000, using the proceeds from the issuance of a convertible obligation (note 9). On November 28, 2002, the Company invested in an additional $350,000 of Cumulative First Preferred Series A Shares of QMI, using the proceeds from the issuance of a convertible obligation (note 9). The shares are redeemable at the option of the issuer or retractable at the option of the Company at the paid-up value, are non-voting, and carry a 12.5% annual fixed cumulative preferential dividend payable semi-annually. During fiscal 2002, total dividends of $203,168 (2001—$95,342) were declared on the Cumulative First Preferred Shares owned by the Company. In fiscal 2002, the Company received payments of dividend income of $202,739 from QMI, and at December 31, 2002, the Company had a receivable from QMI of $95,771, representing the cumulative declared, but unpaid dividend on these shares.

6. FIXED ASSETS

	2001
	Cost		Accumulated Depreciation			Net Book Value
Land	$	21,363	$	—		$	21,363
Buildings		109,286		(22,573	)		86,713
Machinery and equipment		216,623		(104,409	)		112,214
Projects under development		6,909		—			6,909
Total	$	354,181	$	(126,982	)	$	227,199

	2002
	Cost		Accumulated Depreciation			Net Book Value
Land	$	20,980	$	—		$	20,980
Buildings		107,772		(25,461	)		82,311
Machinery and equipment		228,290		(126,667	)		101,623
Projects under development		3,516		—			3,516
Total	$	360,558	$	(152,128	)	$	208,430

7. OTHER ASSETS

	2001		2002
Deferred financing costs	$	15,117	$	11,709
Deferred pension		5,705		5,581
Other		494		325
Total	$	21,316	$	17,615

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8. LONG-TERM DEBT

	Interest Rate as at December 31, 2002	Years of Maturity	2001		2002
Senior bank credit facility	3.8%	2004-2005	$	337,755	$	300,514
Senior Subordinated Notes	9.5%	2007		216,757		214,633
Total			$	554,512	$	515,147

(a)  Senior Bank Credit Facility

        The senior bank credit facility ("Credit Facility") is comprised of a revolving credit facility maturing in March 2003 and a term reducing loan maturing in 2005. At December 31, 2002, the aggregate amount of credit available under the revolving credit facility was $75,000 (2001—$75,000), of which $311 (2001—$1,061) was used for outstanding letters of credit, and no other amounts were drawn on the revolving credit facility.

        The revolving credit facility may be extended for an additional 364-day period. If the revolving credit facility is not extended, any amount borrowed under the revolving credit facility would mature in March 2004.

        Sun Media may borrow at interest rates based on banker's acceptances and/or prime plus an applicable margin (the "Margin"), with the Margin tied to financial ratios. The Credit Facility is collateralized by liens on all of the property, assets and shares of Sun Media and of its operating subsidiaries, now owned or hereafter acquired.

        Sun Media is required to maintain financial ratios under the Credit Facility, including total debt to operating cash flow, senior debt to operating cash flow, interest coverage, fixed charge coverage and debt service coverage.

(b)  Senior Subordinated Notes

        The Senior Subordinated Notes are comprised of 9¹/2% Senior Subordinated Notes due February 2007 (the "First Notes") and of 9¹/2% Senior Subordinated Notes due May 2007 (the "Second Notes") (collectively the "Notes"). Interest is payable semi-annually on the Notes. The Notes are general unsecured obligations of Sun Media, subordinate in right of payment to all existing and future senior indebtedness of Sun Media, and senior in right of payment to any subordinated indebtedness of Sun Media.

        At December 31, 2001 and 2002, the outstanding principal amount of the First and Second Notes was US $97,500 and US $53,500, respectively. The Notes were recorded at their fair market value on January 7, 1999, which was determined based on quoted market prices and the fair value of the Company's related financial instruments. The difference between the fair market value and the principal amount in Canadian dollars is being amortized over the term of the Notes. At December 31, 2002, the unamortized balance of the premium was $8,945 (2001—$11,069). The effective interest rates on the Notes for the year ended December 31, 2002 was 8.6% (2001—8.6%; 2000—8.6%).

F-15

(c)  Principal Repayments

        As at December 31, 2002, the aggregate amount of minimum principal payments required in each of the next five years based on current borrowing levels and the payment requirements under the Credit Facility and the Notes is as follows:

Year Ending December
2003	$	60,000
2004		80,000
2005		160,514
2006		—
2007		214,633
	$	515,147

9. CONVERTIBLE OBLIGATIONS

        On July 9, 2001, the Company issued a $1,600,000 convertible obligation to its parent, QMI. The convertible obligation matures on July 14, 2007, and bears interest at 12.15% payable semi-annually. On November 28, 2002, the Company issued a new convertible obligation to QMI in the amount of $350,000. This new convertible obligation matures on November 28, 2008, and bears interest at 12.15% payable semi-annually.

        In fiscal 2002, the interest on the convertible obligations charged to retained earnings amounted to $197,479 (2001—$92,673) or $128,434 (2001—$58,384) after income taxes of $69,045 (2001—$34,289). The total interest payments in fiscal 2002 were $197,063 and at December 31, 2002 the unpaid interest on the convertible obligations amounted to $93,089 (2001—$92,673).

        The Company may elect to defer, at any time and from time to time, coupon payments on the convertible obligations by extending the coupon payment period on the obligations for a period of up to 12 consecutive semi-annual periods, provided, however, that no extension period may extend beyond July 14, 2007 or November 28, 2008 for each obligation respectively. The Company may at any time, at its option, elect to satisfy its obligations to pay any coupon (including any deferred coupon) by issuing and delivering to the holder of the convertible obligation fully-priced and non-assessable common shares of our capital stock.

        On or after May 15, 2007, QMI may, upon the occurrence of certain events, require the Company to redeem the convertible obligations at a redemption amount equal to the then outstanding principal amount plus any accrued and unpaid interest.

        By giving notice to the holder at any time prior to July 14, 2007 or November 28, 2008 for each convertible obligation respectively, the Company may elect to convert all or any part of the unpaid face amount and accrued and unpaid coupon payments into common shares and the number of which shares shall be determined by dividing the amount to be so converted by the fair value of one common share.

F-16

10. CAPITAL STOCK (In thousands of Canadian dollars, except for per share information)

        The Class A Common Shares are voting and entitle their holders to receive dividends as declared by the Board of Directors.

        The Class B Preferred Shares are non-voting and redeemable at the option of the Company. Under certain circumstances the Company has the right to purchase all or part of the then issued Class B Preferred Shares at its own option, or by mutual agreement with the holders of the then outstanding Class B Preferred Shares. The Class B Preferred Shares entitle their holders to receive a non-cumulative dividend at a rate that shall be determined from time to time by the Board of Directors.

        The Class C Preferred Shares are issuable in series. Terms and conditions of the Class C Preferred Shares are to be determined from time to time, by the Board of Directors.

Dividends

        The dividends declared and paid by the Company for the year ended December 31, 2002 totalled $70,945 or $56.26 per share (2001—$45,359 or $35.97 per share) (note 15).

Stock-based Compensation

        On January 29, 2002, QMI established a stock option plan (the "QMI Plan") for directors, executive officers and key employees of QMI and its subsidiaries. All of the options granted under this stock option plan entitle the holder thereof to acquire common shares of QMI. Each option may be exercised within a maximum period of ten years following the date of grant at an exercise price not lower than the fair market value of the common shares on the grant date as determined by the QMI Compensation Committee. No option may be exercised by an optionee if the shares of QMI have not been listed on a recognized stock exchange. At December 31, 2007, if the shares of QMI have not been so listed, optionees will have until January 31, 2008 to exercise their vested options. At the time of exercise, the option holder may request to receive a cash amount. Options vest over a five year period in accordance with one of the following vesting schedules as determined by the Compensation Committee at the time of grant: (i) equally over five years with the first 20.0% vesting on the first anniversary of the date of the grant, (ii) equally over four years with the first 25.0% vesting on the second anniversary of the date of the grant, and (iii) equally over three years with the first 33.3% vesting on the third anniversary of the date of the grant. As at December 31, 2002, 42,629,700 options have been issued under the QMI Plan to employees of the Company. The exercise price of all options is $0.2310 and expires in 2012. No options have vested as at December 31, 2002.

        In addition, shares have been set aside for officers, senior employees and other key employees of Quebecor or its subsidiaries, under a stock option plan (the "Quebecor Plan") established by Quebecor, which allows them the opportunity to benefit from the appreciation in value of the shares. Each option may be exercised within a maximum period of ten years following the date of grant. As at December 31, 2002, 15,000 options have been issued under the Quebecor Plan to employees of the Company at an exercise price of $27.64, which expire in 2012. The options issued vest equally over four years with the first 25% vesting on the second anniversary of the date of grant. As at December 31, 2002, 3,750 of the options have vested.

F-17

        For the year ended December 31, 2002, no compensation expense has been recorded by the Company for options issued to its employees under the QMI Plan or the Quebecor Plan, as the fair value of the respective shares for QMI and Quebecor were lower than the exercise price of the respective options issued.

11. TRANSLATION ADJUSTMENT

        The translation adjustment included in shareholder's equity is the result of the fluctuation of the exchange rate on the translation to Canadian dollars of net assets of self-sustaining foreign operations.

12. ACQUISITIONS AND DISPOSITIONS

Acquisition of 3351611 Canada Inc. and Gratte-Ciel

        On March 1, 2002, the Company acquired 3351611 Canada Inc. ("3351611") and Gratte-Ciel from its parent, QMI, for net cash payments of $756. As this transaction was between related parties, the excess of the purchase price over the net book value of the two acquired companies of $230 was recorded as an adjustment to retained earnings. 3351611 is the holding company of Gratte-Ciel, which operates two weekly publications, Montreal Mirror and Ici Montreal.

Disposition of Ripnet

        Effective March 28, 2002, Sun Media sold through its wholly owned subsidiary, Sun Media (Toronto) Corporation, substantially all the assets of Ripnet for net cash proceeds of $925. Ripnet was in the business of providing internet access and web hosting services to retail customers in the Brockville, Ontario market. The gain on the sale was $244, and is included in other operating expenses in the consolidated statement of income.

13. COMMITMENTS AND CONTINGENCIES

(a)  Leases and Commitments

        The Company rents premises and equipment under operating leases, which expire at various dates up to 2013. The 2002 rental expense for these operating leases was $6,841 (2001—$6,565, 2000—$5,252). The Company has also entered into long-term commitments to purchase services and capital over periods which expire at various dates up to 2009. Minimum payments under these arrangements for each of the next five years and thereafter are as follows:

Year Ending December	Leases		Other Commitments
2003	$	5,794	$	5,451
2004		4,252		3,008
2005		3,005		961
2006		2,184		229
2007		1,821		182
Thereafter		6,304		168
	$	23,360	$	9,999

F-18

(b)  Newsprint

        Newsprint represents a significant input and component of operating costs for the Company. Sun Media uses several newsprint manufacturers to supply its requirements, and has entered into a long-term agreement expiring December 31, 2005 with one company to supply the majority of its newsprint purchases. The Company's annual minimum purchase requirement under the agreement is approximately 125,400 tonnes of newsprint.

(c)  Management Fee

        In 2002, the Company began paying an annual management fee to QMI for services rendered to the Company pursuant to a five-year management services agreement. These services include internal audit, legal and corporate, financial planning and treasury, tax, real estate, human resources, risk management, public relations and other services. The agreement provides for an annual management fee of $5,100 in respect of 2002, $5,400 in respect of 2003 and amounts to be agreed upon for the years 2004, 2005 and 2006. In addition, QMI is entitled to the reimbursement of out-of-pocket expenses incurred in connection with the services provided under the agreement. In no event may the fees and reimbursements paid to QMI for any given year exceed 1.5% of the Company's consolidated revenues for such year.

(d)  Legal Actions

        A number of legal actions against the Company are outstanding. In the opinion of management the outcome of these legal actions will not have a material adverse effect on the Company's results of operations or its financial position.

14. FINANCIAL INSTRUMENTS

(a)  Credit Risk

        Sun Media does not have a significant exposure to any individual customer or counter-party. The Company is exposed to credit risk in the event of non-performance by counter-parties in connection with its foreign currency interest rate swap agreements. Sun Media does not obtain collateral or other security to support financial instruments subject to credit risk but mitigates this risk by dealing only with major Canadian financial institutions and, accordingly, does not anticipate loss for non-performance.

(b)  Interest Rate and Currency Risk

        Sun Media has entered into a number of foreign currency, fixed and variable interest rate swap agreements for 100% of its Senior Subordinated Notes in order to reduce the Company's exposure to changes in the exchange rate of the US dollar as compared to the Canadian dollar. The effect of these agreements is to convert the obligation of the Company to service interest and principal payments on US dollar denominated debt of $151,000 into Canadian dollar denominated debt of $205,688 at an average exchange rate of Cdn $1.3622 to US $1.00.

F-19

        In addition, these interest rate swap agreements have the effect of converting the interest rate on US $118,500 of Senior Subordinated Notes from a fixed rate of 9.5% to a weighted average fixed interest rate on Cdn $161,394 of 9.51%. These agreements also convert the interest rate on US $32,500 of Senior Subordinated Notes from a fixed rate of 9.5% per annum to a floating interest rate on Cdn $44,294 equal to the banker's acceptance rate plus 2.94% per annum.

(c)  Fair Values

        Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgement and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

        The carrying value and estimated fair value of the Company's financial instruments as at December 31, are as follows:

		2001
					Fair Value
		Carrying Amount			Primary Debt Instrument			Currency & Interest Instruments			Total Financial Instruments
Interest rate swap agreements		$	—		$	—		$	(1,171	)	$	(1,171	)
Interest rate cap agreements		$	172		$	—		$	—		$	—
Long-term debt
	Credit Facility	$	(337,755	)	$	(337,755	)	$	—		$	(337,755	)
	Senior Subordinated Notes		(216,757	)		(245,015	)		43,390			(201,625	)
		$	(554,512	)	$	(582,770	)	$	43,390		$	(539,380	)

		2002
					Fair Value
		Carrying Amount			Primary Debt Instrument			Currency & Interest Instruments		Total Financial Instruments
Long-term debt
	Credit Facility	$	(300,514	)	$	(300,514	)	$	—	$	(300,514	)
	Senior Subordinated Notes		(214,633	)		(242,919	)		55,355		(187,564	)
		$	(515,147	)	$	(543,433	)	$	55,355	$	(488,078	)

        The fair values of the interest rate swap and cap agreements are estimated based upon discounted cash flows using applicable current market rates. The fair market value of the senior bank credit facility is estimated to approximate carrying values as rates are tied to short-term indices. The fair value of the Senior Subordinated Notes and applicable hedging arrangements are estimated based on their quoted market prices.

F-20

        The carrying amount of cash and cash equivalents, short-term investments, accounts receivable, accounts payable and accrued liabilities, and other liabilities in the consolidated balance sheet approximate fair values because of the short-term nature of these instruments.

15. RELATED PARTY TRANSACTIONS

        Sun Media has earned revenue for advertising and other services, and incurred expenses for purchases and services, at prices and conditions prevailing on the market, with related companies under common control as follows:

	2001		2002
Revenue	$	12,265	$	9,551
Accounts receivable		5,473		1,756
Purchases		12,731		13,063
Accounts payable		4,567		4,994

        During fiscal 2002, Sun Media paid dividends of $70,945 (2001—$45,359) to its parent, QMI (note 10). Furthermore, Sun Media earned dividend income from QMI of $203,168 (2001—$95,342) during fiscal 2002, of which $95,771 was unpaid at December 31, 2002 (note 5). During fiscal 2002, Sun Media also incurred interest of $197,479 (2001—$92,673) payable to QMI relating to the convertible obligations of $1,950,000 (note 9). At December 31, 2002, an accrued interest balance of $93,089 was outstanding.

        In 2002, the Company began paying a management fee to QMI for services rendered to the Company pursuant to a five-year management services agreement (note 13c). For the year ended December 31, 2002, the management fee amounted to $5,100 and is reflected in other operating expenses. As at December 31, 2002, the outstanding balance relating to the fee was $nil.

        In addition, in 2002 the Company acquired 3351611 from its parent, QMI, for net cash proceeds of $756 (note 12).

16. EMPLOYEE FUTURE BENEFITS

        The Company offers a number of defined benefit and defined contribution plans providing pension, other retirement, sabbatical and post-employment benefits to Sun Media employees.

Contribution Plans

        The total expense for Sun Media's defined contribution plans amounted to $2,017 for the year ended December 31, 2002 (2001—$2,347, 2000—$2,310).

F-21

Defined Benefit Plans

        In July 2002, the Company introduced a new defined benefit plan for its employees. The employees had the option to remain in their current defined contribution or defined benefit plan, or to join the new pension plan. Information about the defined benefit plans, in aggregate, is as follows:

(a)  Change in Benefit Obligation

	Pension Benefit Plans						Other Benefit Plans
	2001			2002			2001			2002
Benefit obligation at beginning of year	$	164,969		$	177,445		$	9,783		$	15,064
Amendments		4,548			4,402			4,108			—
Service cost		4,197			5,060			1,165			934
Interest cost		11,805			12,491			1,050			1,033
Plan participants' contributions		2,654			2,645			—			—
Actuarial loss (gain)		(4,563	)		2,666			562			3,463
Benefit payments and transfers		(6,165	)		(5,759	)		(1,137	)		(882	)
Curtailment gain		—			—			(467	)		—
Benefit obligation at end of year	$	177,445		$	198,950		$	15,064		$	19,612

(b)  Change in Plan Assets

	Pension Benefit Plans						Other Benefit Plans
	2001			2002			2001		2002
Fair value of plan assets at beginning of year	$	169,314		$	171,528		$	—	$	—
Actual return on plan assets		1,194			(13,412	)		—		—
Employer contributions		4,531			4,253			—		—
Plan participants' contributions		2,654			2,645			—		—
Benefit payments and transfers		(6,165	)		(5,759	)		—		—
Fair value of plan assets at end of year	$	171,528		$	159,255		$	—	$	—

(c)  Funded Status

	Pension Benefit Plans						Other Benefit Plans
	2001			2002			2001			2002
Excess of fair value of plan assets over benefit obligation at end of year	$	(5,917	)	$	(39,695	)	$	(15,064	)	$	(19,612	)
Unrecognized net actuarial loss (gain)		(1,908	)		27,944			562			4,025
Unrecognized prior service cost (gain)		4,225			8,003			(1,183	)		(1,827	)
Valuation allowance		(7,018	)		(7,689	)		—			—
Net amount recognized at end of year	$	(10,618	)	$	(11,437	)	$	(15,685	)	$	(17,414	)

F-22

(d)  Amount Recognized in the Consolidated Balance Sheet

	Pension Benefit Plans						Other Benefit Plans
	2001			2002			2001			2002
Prepaid benefit costs	$	5,705		$	5,581		$	—		$	—
Accrued benefit liability		(16,323	)		(17,018	)		(15,685	)		(17,414	)
Net amount recognized at end of year	$	(10,618	)	$	(11,437	)	$	(15,685	)	$	17,414

(e)  Components of Net Benefit Cost

	Pension Benefit Plans									Other Benefit Plans
	2000			2001			2002			2000			2001			2002
Service cost	$	4,053		$	4,197		$	5,060		$	1,353		$	1,165		$	934
Interest cost		10,871			11,805			12,491			966			1,050			1,033
Expected return on plan assets		(11,941	)		(14,016	)		(13,771	)		—			—			—
Amortization of actuarial gain		—			(669	)		(3	)		—			—			—
Amortization of prior service cost (gain)		—			323			624			(82	)		(1,029	)		(286	)
Curtailment gain		—			—			—			—			(467	)		—
Valuation allowance		928			966			671			—			—			—
Net benefit cost	$	3,911		$	2,606		$	5,072		$	2,237		$	719		$	1,681

(f)    Weighted-average Assumptions

	Pension Benefit Plans		Other Benefit Plans
	2001	2002	2001	2002
Discount rate	6.75%	6.75%	6.75%	6.75%
Expected return on plan assets for the year	8.0%	7.75%	—	—
Rate of compensation increase	3–3.5%	3.75%	3–3.5%	3.75%

        Assumed health care cost trend rates have a significant effect on the amounts reported for health care plans. For measurement of the accumulated postretirement benefit obligation, a 10% annual rate of increase in the per capita cost of covered health care benefits was assumed for 2002 and 2001. The rate was assumed to decrease to 5% over 10 years, and remain at that level thereafter. An increase of 1% in the assumed health care cost trend would increase the current service costs by $147 (2001—$120; 2000—$140), interests costs by $189 (2001—$174; 2000—$158), and benefit obligations by $3,711 (2001—$2,780; 2000—$1,216). A decrease of 1% in the assumed health care cost trend would decrease the current service costs by $110 (2001—$91; 2000—$104), interest costs by $145 (2001—$133; 2000—$135), and benefit obligations by $2,849 (2001—$2,129; 2000—$928).

F-23

17. SEGMENTED INFORMATION

        Management has reviewed the requirements of CICA Handbook 1701 "Segment Disclosures", and determined that there are no reportable segments requiring disclosure. This conclusion was reached on the basis that the Company's newspaper divisions exhibit similar economic characteristics, with similar products, production processes, and classes of customers. The Company's operations are primarily in Canada.

18. MATERIAL DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) IN CANADA AND THE UNITED STATES

        The consolidated financial statements have been prepared in accordance with generally accepted accounting principles as applied in Canada which are different in some respects from those applicable in the United States, as described below. The following tables set forth the impact of material differences between GAAP in Canada and GAAP in the United States on the Company's consolidated financial statements, including disclosures that are required under GAAP in the United States.

Consolidated Statements of Income

	2000			2001			2002
Net income for the year per Canadian GAAP	$	62,274		$	152,478		$	309,175
Adjustments:
Pension and post-retirement benefits (i)		(864	)		(983	)		(955	)
Restructuring charges (ii)		(5,669	)		124			—
Cumulative effect of change in accounting policy for derivative financial instruments (iii)		—			(183	)		—
Derivative financial instruments (iii)		—			(1,630	)		1,693
Interest on convertible obligations (iv)		—			(92,673	)		(197,479	)
Income taxes (vi)		3,977			33,849			68,832
Net income for the year per US GAAP	$	59,718		$	90,982		$	181,266
Net income is comprised of:
Income from continuing operations	$	59,718		$	91,165		$	181,266
Cumulative effect of change in accounting policy for derivative financial instruments (iii)		—			(183	)		—
	$	59,718		$	90,982		$	181,266

F-24

Consolidated Statements of Comprehensive Income (v)

	2000		2001			2002
Comprehensive income:
Net income as adjusted per US GAAP	$	59,718	$	90,982		$	181,266
Pension and post-retirement benefits (i)		—		—			(6,189	)
Cumulative effect of change in accounting policy for derivative financial instruments (iii)		—		298			—
Derivative financial instruments (iii)		—		2,931			11,875
Foreign currency translation adjustment		221		359			(95	)
Income taxes (vi)		—		(710	)		(447	)
Comprehensive income per US GAAP	$	59,939	$	93,860		$	186,410

	2000			2001			2002
Other comprehensive income:
Pension and post-retirement benefits	$	—		$	—		$	(6,189	)
Derivative financial instruments		—			3,229			15,104
Foreign currency translation adjustment		(82	)		277			182
Income taxes		—			(710	)		(1,157	)
Other comprehensive income per US GAAP	$	(82	)	$	2,796		$	7,940

Consolidated Shareholder's Equity

	2000			2001			2002
Shareholder's Equity per Canadian GAAP	$	397,426		$	2,139,193		$	2,599,080
Cumulative Adjustments:
Pension and post-retirement benefits (i)		1,275			292			(6,852	)
Restructuring charges (ii)		(7,105	)		(6,981	)		(6,981	)
Derivative instruments (iii)		—			1,416			14,984
Convertible obligation (iv)		—			(1,692,673	)		(2,043,089	)
Income taxes (vi)		3,121			1,971			1,311
Shareholder's Equity per US GAAP	$	394,717		$	443,218		$	558,453

F-25

Consolidated Statements of Cash Flows

        The disclosure of a subtotal of the amount of funds provided by operations before changes in non-cash operating working capital items in the consolidated statement of cash flows is allowed by Canadian GAAP while it is not allowed by US GAAP. Other differences in the Statements of Cash Flows relating to the convertible obligation (iv) are outlined below

	2000			2001		2002
Cash provided by operating activities per Canadian GAAP	$	134,027		$	140,583	$	400,272
Interest paid on convertible obligation (iv)		—			—		(197,063	)
Cash provided by operating activities per US GAAP	$	134,027		$	140,583	$	203,209
Cash provided by (used in) financing activities per Canadian GAAP	$	(113,492	)	$	1,513,635	$	43,565
Interest paid on convertible obligation (iv)		—			—		197,063
Cash provided by (used in) financing activities per US GAAP	$	(113,492	)	$	1,513,635	$	240,628

(i)    Pension and Post-Retirement Benefits

        The accounting requirements for pension and post-retirement benefits under Canadian and US GAAP are similar in most respects. However, because the new Canadian Section 3461 was adopted retroactively on January 1, 2000, liabilities and assets recorded under Canadian GAAP will be different from US GAAP, as a result of unrecognized actuarial gains or losses existing at the date of implementation under US GAAP. These gains or losses will be amortized over the estimated average remaining service life of the employees.

        Under US GAAP, if the accumulated benefit obligation exceeds the fair value of a pension plan's assets, the Company is required to recognize a minimum accrued liability equal to the unfunded accumulated benefit obligation, which is recorded as a separate component of shareholder's equity.

(ii)  Restructuring Charges

        In respect of the 1999 acquisition of Sun Media described in note 12, certain of the restructuring charges related to the acquired newspapers are recorded in the purchase equation as goodwill under Canadian GAAP, but are excluded from the purchase equation and expensed under US GAAP.

(iii) Derivative Financial Instruments

        Effective January 1, 2001, the Company adopted Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities", as amended ("FAS 133"). FAS 133 establishes accounting and reporting standards for derivative instruments and hedging activities and requires that all derivatives be recorded at fair value.

F-26

18. MATERIAL DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) IN CANADA AND THE UNITED STATES (Continued)

        The Company utilizes interest rate and foreign exchange swap agreements to enhance its ability to manage risk relating to cash flow and fair value exposures. The Company does not enter into contracts for speculative purposes. On the earlier of the date into which the derivative contract is entered or the date of transition, the Company designates the derivative as a hedge. Changes in the derivative fair values of contracts that are designated effective and qualify as cash flow hedges are deferred and recorded as a component of "comprehensive income" until the underlying transaction is recorded in earnings. When the hedged item affects earnings, gains or losses are reclassified from "comprehensive income" to the consolidated statement of income on the same line as the underlying transaction. The ineffective portion of a hedging derivative's change in fair value is recognized immediately in earnings.

        With the implementation of FAS 133 on January 1, 2001, the Company recorded a charge to earnings as a cumulative effect type adjustment of $277 relating to the initial mark-to-market of the interest rate swap and cap agreements on the Credit Facility and recorded a credit of $94 relating to the designated fair value hedges on US $32,500 of the Senior Subordinated Notes. In addition, the Company recorded a credit to other comprehensive income as a cumulative effect type adjustment of $298 relating to designated cash flow hedges on US $118,500 of Senior Subordinated Notes. During the year ended December 31, 2002, the Company recorded a credit to earnings of $1,343, net of taxes of $470 relating to the interest rate swap and cap agreements on the Credit Facility (2001—a charge of $1,066 net of taxes of $470) and $350 net of taxes of $78 relating to the fair value hedges on the Senior Subordinated Notes (2001—a charge of $564 net of taxes of $103). Also during the year, the Company recorded a credit to other comprehensive income of $11,875 net of taxes of $2,613 (2001—$2,931 net of taxes of $710) relating to the cash flow hedges on the Senior Subordinated Notes.

        The gains of $15,104 net of taxes of $3,323 reported in accumulated other comprehensive income at December 31, 2002 are expected to be reclassified into earnings during 2003 with the redemption of Senior Subordinated Notes (note 19).

        Under GAAP in Canada, derivative financial instruments are accounted for on an accrual basis. Gains and losses are deferred and recognized in income in the same period and the same financial statement category as the income or expense arising from the corresponding hedged positions.

(iv)  Convertible Obligations

        The convertible obligations issued by the Company in fiscal 2001 and 2002 are considered to be part of shareholder's equity under Canadian GAAP, and the interest expense thereon, net of taxes, is charged to retained earnings. Under US GAAP, these convertible obligations would be classified as long term debt. The interest expense on the obligations would be charged to earnings.

(v)  Comprehensive Income

        Comprehensive income is measured in accordance with FAS No. 130, "Reporting Comprehensive Income". This standard defines comprehensive income as all changes in equity other than those resulting from investments by owners and distributions to owners. Other comprehensive income consists of adjustments to shareholder's equity and the accrued benefit liability, representing the excess of the accumulated pension benefit obligation as compared to the fair value of plan assets, the net gain or loss on derivative instruments designated as cash flow hedges, and translation adjustments on foreign operations.

F-27

(vi)  Income Taxes

        This adjustment represents the tax impact of the US GAAP adjustments. Furthermore, under Canadian GAAP, income tax assets and liabilities are measured using substantively enacted rates. Under US GAAP, income tax assets and liabilities are measured using enacted rates. The fiscal 2000 and 2001 years include an adjustment for this difference in US GAAP of $1,357.

(vii) Concentrations in the Available Sources of Newsprint Supply

        Newsprint represents a significant input and component of operating costs for the Company. The Company currently utilizes several newsprint manufacturers, although more than 80% of the newsprint tonnage in 2002 was purchased from one main supplier.

(viii)Accrued Liabilities

        Under US GAAP, items which comprise more than 5% of total current liabilities must be disclosed separately. Included in accrued liabilities at December 31, 2001 is accrued vacation pay of $18,585 (2001—$17,370) and accrued interest expense of $5,735 (2001—$6,960).

(ix)  Expenses

        Included in other operating expenses are advertising costs of $23,200 (2000—$23,900; 2001—$21,300) and circulation costs, which include distribution and subscription acquisition costs, of $60,100 (2000—$61,700; 2001—$56,700).

(x)  Recent Accounting Pronouncements

        (a)  In June 2001, the Financial Accounting Standards Board (FASB) issued FAS No. 143, "Accounting for Asset Retirement Obligations" ("FAS 143"), which addresses financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. FAS 143 requires the Company to record the fair value of an asset retirement obligation as a liability in the period in which it incurs a legal obligation associated with the retirement of tangible long-lived assets that result from the acquisition, construction, development and/or normal use of the assets. The fair value of the liability is added to the carrying amount of the associated asset and this additional carrying amount is depreciated over the life of the asset. Subsequent to the initial measurement of the asset retirement obligation, the obligation will be adjusted at the end of each period to reflect the passage of time and changes in the estimated future cash flows underlying the obligation. If the obligation is settled for other than the carrying amount of the liability, the Company will recognize a gain or loss on settlement. The Company is required and plans to adopt the provisions of FAS 143 for the quarter ending March 31, 2003. To accomplish this, the Company must identify all legal obligations for asset retirement obligations, if any, and determine the fair value of these obligations on the date of adoption. The determination of fair value is complex and will require the Company to gather market information and develop cash flow models. Additionally, the Company will be required to develop processes to track and monitor these obligations. Because of the effort

F-28

necessary to comply with the adoption of FAS 143, the Company is currently assessing the impact of the new standard.

        (b)  In April 2002, the FASB issued FAS No. 145, which rescinded FAS No. 4 "Reporting Gains and Losses from Extinguishment of Debt" ("FAS 145"). The Statement addresses, among other things, the income statement treatment of gains and losses related to debt extinguishments, requiring that such expenses no longer be treated as extraordinary items, unless the items meet the definition of extraordinary per APB Opinion No. 30, Reporting the Results of Operations—Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions. Upon adoption, any gain or loss on extinguishment of debt that was classified as an extraordinary item in prior periods presented, that does not meet the criteria in Opinion 30 for classification as an extraordinary item, is required to be reclassified. The new presentation requirements must be adopted for fiscal years beginning after May 15, 2002, with early application encouraged. The Company will adopt the requirements of FAS 145 for US GAAP purposes in fiscal 2003.

        (c)  In July 2002, the FASB issued FAS No. 146, "Accounting for Costs Associated with Exit or Disposal Activities" ("FAS 146") which is effective for exit or disposal activities that are initiated after December 31, 2002. FAS 146 nullifies Emerging Issues Task Force Issue No. 94-3 ("EITF 94-3") Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in Restructuring). The principal difference between FAS 146 and EITF 94-3 related to the recognition of a liability for a cost associated with an exit or disposal activity. FAS 146 requires that a liability be recognized for exit or disposal costs only when the liability is incurred, whereas under EITF 94-3 the liability was recognized when a company commits to an exit plan, and that the liability be initially measured at fair value. The Company is currently assessing the impact of the new standard.

        (d)  In November 2002, the FASB issued Interpretation No. 45 "Guarantor's Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others" (the "Interpretation") which addresses the disclosure to be made by a guarantor in its interim and annual financial statements about its obligations under guarantees. The Interpretation also requires the recognition of a liability by a guarantor at the inception of certain guarantees.

        The Interpretation requires the guarantor to recognize a liability for the non-contingent component of the guarantee; this is the obligation to stand ready to perform in the event that the specified triggering events or conditions occur. The initial measurement of this liability is the fair value of the guarantee at inception. The recognition of the liability is required even if it is not probable that payments will be required under the guarantee or if the guarantee was issued with a premium payment or as part of a transaction with multiple elements.

        The Company has reviewed the requirements of the Interpretation and determined that it has no direct or indirect guarantees of indebtedness requiring disclosures.

F-29

(xi)  Guaranteed Debt

        The consolidating information below has been presented in accordance with the requirements of the Securities and Exchange Commission.

        The Company's Senior Notes due 2013 described in note 19 will be guaranteed by specific subsidiaries of the Company (the "Subsidiary Guarantors"). The accompanying condensed consolidating financial information as at December 31, 2001 and 2002 and for the years ended December 31, 2000, 2001 and 2002 has been prepared in accordance with US GAAP. The information under the column headed "Combined Guarantors" is for all the Subsidiary Guarantors. Investments in the Subsidiary Guarantors are accounted for by the equity method in the separate column headed "Sun Media". Each Subsidiary Guarantor is wholly-owned by the Company. The non-guarantor subsidiaries, which are individually and in aggregate minor subsidiaries, have been included in the column headed "Sun Media". All guarantees are full and unconditional, and joint and several (to the extent permitted by applicable law).

        The information presented hereunder is on the basis of GAAP in the United States, and consequently the information in respect of the subsidiaries reflects the values that resulted from the acquisition of January 7, 1999. This is generally referred to as push-down accounting.

        The financial statements on a consolidated basis already reflected the basis resulting from the acquisition as a result of a merger between the acquirer and the acquired operating entity in 1999.

        The other US GAAP adjusting entries already described above have been reflected in the appropriate column.

F-30

18. MATERIAL DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) IN CANADA AND THE UNITED STATES (Continued)

CONSOLIDATING BALANCE SHEET

As at December 31, 2000

		Sun Media		Combined Guarantors			Adjustments and Eliminations			Consolidated
ASSETS
CURRENT ASSETS
	Cash and cash equivalents	$	3,392	$	55		$	—		$	3,447
	Accounts receivable		62,913		48,705			—			111,618
	Due from parent/guarantor subsidiaries		3,757		—			(3,757	)		—
	Inventories		7,525		5,029			—			12,554
	Prepaid expenses and other assets		2,423		15,205			—			17,628
TOTAL CURRENT ASSETS			80,010		68,994			(3,757	)		145,247
INVESTMENTS IN GUARANTOR SUBSIDIARIES			575,261		—			(575,261	)		—
FIXED ASSETS			110,651		123,196			—			233,847
GOODWILL			363,983		404,275			—			768,258
FUTURE INCOME TAX			—		32,747			—			32,747
OTHER ASSETS			42,165		2			—			42,167
TOTAL ASSETS		$	1,172,070	$	629,214		$	(579,018	)	$	1,222,266
LIABILITIES
CURRENT LIABILITIES
	Accounts payable and accrued liabilities	$	77,296	$	32,884		$	—		$	110,180
	Due to parent/guarantor subsidiaries		—		3,757			(3,757	)		—
	Income and other taxes		2,145		3,112			—			5,257
	Deferred subscription revenue		8,573		5,490			—			14,063
TOTAL CURRENT LIABILITIES			88,014		45,242			(3,757	)		129,500
LONG-TERM DEBT			616,354		—			—			616,354
FUTURE INCOME TAXES			36,264		6,270			—			42,534
OTHER LIABILITIES			34,722		2,522			—			37,244
NON-CONTROLLING INTEREST			1,917		—			—			1,917
TOTAL LIABILITIES			777,271		54,035			(3,757	)		827,549
SHAREHOLDER'S EQUITY
	Capital stock		301,801		484,904			(484,904	)		301,801
	Retained earnings		92,998		90,357			(90,357	)		92,998
	Other comprehensive income		—		(82	)		—			(82	)
TOTAL SHAREHOLDER'S EQUITY			394,799		575,179			(575,261	)		394,717
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY		$	1,172,070	$	629,214		$	(579,018	)	$	1,222,266

F-31

CONSOLIDATING STATEMENT OF INCOME

For the year ended December 31, 2000

		Sun Media			Combined Guarantors		Adjustments and Eliminations			Consolidated
REVENUES		$	518,611		$	336,636	$	(5,160	)	$	850,087
OPERATING EXPENSES
	Wages and employee benefits		189,448			130,093		—			319,541
	Newsprint		66,032			51,183		—			117,215
	Other operating expenses		133,544			80,483		(5,160	)		208,867
			389,024			261,759		(5,160	)		645,623
OPERATING INCOME BEFORE THE UNDERNOTED			129,587			74,877		—			204,464
Restructuring changes			2,645			3,147		—			5,792
Depreciation and amortization			23,239			23,309		—			46,548
Financial expenses			49,011			4,074		—			53,085
INCOME BEFORE TAXES, EQUITY EARNINGS OF COMBINED GUARANTORS AND NON-CONTROLLING INTEREST			54,692			44,347		—			99,039
Income taxes			21,470			16,879		—			38,349
Equity earnings of combined guarantors			(27,468	)		—		27,468			—
Non-controlling interest			972			—		—			972
NET INCOME		$	59,718		$	27,468	$	(27,468	)	$	59,718

CONSOLIDATING STATEMENT OF RETAINED EARNINGS

For the year ended December 31, 2000

	Sun Media		Combined Guarantors			Adjustments and Eliminations			Consolidated
RETAINED EARNINGS, BEGINNING OF YEAR	$	33,280	$	88,032		$	(88,032	)	$	33,280
Net income		59,718		27,468			(27,468	)		59,718
Dividends on common stock		—		(16,000	)		16,000			—
Distributions to Sun Media		—		(9,143	)		9,143			—
RETAINED EARNINGS, END OF YEAR	$	92,998	$	90,357		$	(90,357	)	$	92,998

F-32

CONSOLIDATING STATEMENT OF CASH FLOWS

For the year ended December 31, 2000

			Sun Media			Combined Guarantors			Adjustments and Eliminations			Consolidated
CASH PROVIDED BY (USED FOR):
OPERATIONS
	Net income		$	59,718		$	27,468		$	(27,468	)	$	59,718
	Items not involving cash:
		Depreciation and amortization		23,239			23,309			—			46,548
		Future income taxes		6,173			8,592			—			14,765
		Non-controlling interest		972			—			—			972
		Equity earnings of combined guarantors		(27,468	)		—			27,468			—
		Other		1,414			(13	)		—			1,401
	Changes in non-cash operating working capital			50,941			(40,318	)		—			10,623
				114,989			19,038			—			134,027
FINANCING
	Loans			50,294			—			—			50,294
	Repayment of loans			(162,658	)		—			—			(162,658	)
	Dividends on to Sun Media			—			(16,000	)		16,000			—
	Other			(1,128	)		—			—			(1,128	)
				(113,492	)		(16,000	)		16,000			(113,492	)
INVESTING
	Additions to fixed assets			(14,481	)		(5,325	)		—			(19,806	)
	Proceeds from disposal of fixed assets			150			42			—			192
	Dividends received from combined guarantors			16,000			—			(16,000	)		—
	Other			(91	)		—			—			(91	)
				1,578			(5,283	)		(16,000	)		(19,705	)
Increase (decrease) in cash				3,075			(2,245	)		—			830
Cash and cash equivalents—beginning of year				317			2,300			—			2,617
Cash and cash equivalents—end of year			$	3,392		$	55		$	—		$	3,447

F-33

CONSOLIDATING BALANCE SHEET

As at December 31, 2001

		Sun Media		Combined Guarantors			Adjustments and Eliminations			Consolidated
ASSETS
CURRENT ASSETS
	Cash and cash equivalents	$	3,364	$	35,804		$	—		$	39,168
	Accounts receivable		63,613		46,758			—			110,371
	Dividend income receivable from Quebecor Media Inc.		65,547		29,795			—			95,342
	Due from parent/guarantor subsidiaries		—		6,113			(6,113	)		—
	Inventories		7,980		4,030			—			12,010
	Prepaid expenses and other assets		1,631		6,045			—			7,676
TOTAL CURRENT ASSETS			142,135		128,545			(6,113	)		264,567
INVESTMENT IN QUEBECOR MEDIA INC.			1,100,000		500,000			—			1,600,000
INVESTMENTS IN GUARANTOR SUBSIDIARIES			1,119,510		—			(1,119,510	)		—
FIXED ASSETS			111,417		115,782			—			227,199
GOODWILL			362,308		384,763			—			747,071
FUTURE INCOME TAXES			—		33,057			—			33,057
OTHER ASSETS			61,301		—			—			61,301
TOTAL ASSETS		$	2,896,671	$	1,162,147		$	(1,125,623	)	$	2,933,195
LIABILITIES
CURRENT LIABILITIES
	Accounts payable and accrued liabilities	$	72,691	$	36,317		$	—		$	109,008
	Due to parent/guarantor subsidiaries		6,113		—			(6,113	)		—
	Income and other taxes		6,572		(5,115	)		—			1,457
	Deferred subscription revenue		9,476		5,737			—			15,213
	Current portion of long-term debt		5,000		—			—			5,000
TOTAL CURRENT LIABILITIES			99,852		36,939			(6,113	)		130,678
LONG-TERM DEBT			590,143		—			—			590,143
CONVERTIBLE OBLIGATION			1,692,673		529,199			(529,199	)		1,692,673
FUTURE INCOME TAXES			35,700		3,682			—			39,328
OTHER LIABILITIES			33,524		1,793			—			35,317
NON-CONTROLLING INTEREST			1,838		—			—			1,838
TOTAL LIABILITIES			2,453,730		571,559			(535,312	)		2,489,977
SHAREHOLDER'S EQUITY
	Capital stock		301,801		484,904			(484,904	)		301,801
	Retained earnings		138,621		105,407			(105,407	)		138,621
	Other comprehensive income		2,519		277			—			2,796
TOTAL SHAREHOLDER'S EQUITY			442,941		590,588			(590,311	)		443,218
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY		$	2,896,671	$	1,162,147		$	(1,125,623	)	$	2,933,195

F-34

18. MATERIAL DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) IN CANADA AND THE UNITED STATES (Continued)

CONSOLIDATING STATEMENT OF INCOME

For the year ended December 31, 2001

		Sun Media			Combined Guarantors			Adjustments and Eliminations			Consolidated
REVENUES		$	524,214		$	318,442		$	(4,520	)	$	838,136
OPERATING EXPENSES
	Wages and employee benefits		189,415			123,963			—			313,378
	Newsprint		71,753			53,970			—			125,723
	Other operating expenses		131,128			72,566			(4,520	)		199,174
			392,296			250,499			(4,520	)		638,275
OPERATING INCOME BEFORE THE UNDERNOTED			131,918			67,943			—			199,861
Restructuring costs			7,812			9,988			—			17,800
Depreciation and amortization			23,963			23,172			—			47,135
Financial expenses			106,445			30,111			—			136,556
Dividend income			(65,547	)		(29,795	)		—			(95,342	)
INCOME BEFORE TAXES, EQUITY EARNINGS OF COMBINED GUARANTORS AND NON-CONTROLLING INTEREST			59,245			34,467			—			93,712
Income taxes			(1,655	)		3,417			—			1,762
Equity earnings of combined guarantors			(31,050	)		—			31,050			—
Non-controlling interest			968			—			—			968
NET INCOME		$	90,982		$	31,050		$	(31,050	)	$	90,982

CONSOLIDATING STATEMENT OF RETAINED EARNINGS

For the year ended December 31, 2001

	Sun Media			Combined Guarantors			Adjustments and Eliminations			Consolidated
RETAINED EARNINGS, BEGINNING OF YEAR	$	92,998		$	90,357		$	(90,357	)	$	92,998
Net income		90,982			31,050			(31,050	)		90,982
Dividends on common stock		(45,359	)		(16,000	)		16,000			(45,359	)
RETAINED EARNINGS, END OF YEAR	$	138,621		$	105,407		$	(105,407	)	$	138,621

F-35

CONSOLIDATING STATEMENT OF CASH FLOWS

For the year ended December 31, 2001

			Sun Media			Combined Guarantors			Adjustments and Eliminations			Consolidated
CASH PROVIDED BY (USED FOR):
OPERATIONS
	Net income		$	90,982		$	31,050		$	(31,050	)	$	90,982
	Items not involving cash:
		Depreciation and amortization		23,963			23,172			—			47,135
		Future income taxes		1,411			3,854			—			5,265
		Non-controlling interest		968			—			—			968
		Equity earnings of combined guarantors		(31,050	)		—			31,050			—
		Dividend not received		(65,547	)		(29,795	)		—			(95,342	)
		Interest income and expense not paid or received		(29,199	)		29,199			—			—
		Other		2,705			(216	)		—			2,489
	Changes in non-cash operating working capital			90,325			(1,239	)		—			89,086
				84,558			56,025			—			140,583
FINANCING
	Issuance of convertible obligation			1,600,000			500,000			(500,000	)		1,600,000
	Loans			63,068			—			—			63,068
	Repayment of loans			(101,627	)		—			—			(101,627	)
	Dividends on capital stock			(45,359	)		(16,000	)		16,000			(45,359	)
	Other			(2,447	)		—			—			(2,447	)
				1,513,635			484,000			(484,000	)		1,513,635
INVESTING
	Investments			(1,600,000	)		(500,000	)		500,000			(1,600,000	)
	Additions to fixed assets			(14,454	)		(4,753	)		—			(19,207	)
	Proceeds from disposal of fixed assets			242			477			—			719
	Dividends received from combined guarantors			16,000			—			(16,000	)		—
	Other			(9	)		—			—			(9	)
				(1,598,221	)		(504,276	)		484,000			(1,618,497	)
Increase (decrease) in cash				(28	)		35,479			—			35,721
Cash and cash equivalents—beginning of year				3,392			55			—			3,447
Cash and cash equivalents—end of year			$	3,364		$	35,804		$	—		$	39,168

F-36

CONSOLIDATING BALANCE SHEET

As at December 31, 2002

		Sun Media		Combined Guarantors			Adjustments and Eliminations			Consolidated
ASSETS
CURRENT ASSETS
	Cash and cash equivalents	$	817	$	50,229		$	—		$	51,046
	Short-term investments		—		74,419			—			74,419
	Accounts receivable		70,237		46,804			—			117,041
	Dividend income receivable from Quebecor Media Inc.		63,288		32,483			—			95,771
	Income and other taxes		7,021		9,171			—			16,192
	Due from parent/guarantor subsidiaries		13,945		—			(13,945	)		—
	Inventories		6,936		3,564			—			10,500
	Prepaid expenses and other assets		4,854		2,178			—			7,032
TOTAL CURRENT ASSETS			167,098		218,848			(13,945	)		372,001
INVESTMENT IN QUEBECOR MEDIA INC.			1,100,000		850,000			—			1,950,000
INVESTMENTS IN GUARANTOR SUBSIDIARIES			1,528,822		—			(1,528,822	)		—
FIXED ASSETS			103,089		105,341			—			208,430
GOODWILL			362,372		384,281			—			746,653
FUTURE INCOME TAXES			1,303		35,227			—			36,530
OTHER ASSETS			71,998		(223	)		—			71,775
TOTAL ASSETS		$	3,334,682	$	1,593,474		$	(1,542,767	)	$	3,385,389
LIABILITIES
CURRENT LIABILITIES
	Accounts payable and accrued liabilities	$	83,708	$	34,591		$	—		$	118,299
	Due to parent/guarantor subsidiaries		—		13,945			(13,945	)		—
	Deferred subscription revenue		10,496		5,946			—			16,442
	Current portion of long-term debt		60,000		—			—			60,000
TOTAL CURRENT LIABILITIES			154,204		54,482			(13,945	)		194,741
LONG-TERM DEBT			496,782		—			—			496,782
CONVERTIBLE OBLIGATIONS			2,043,089		881,833			(881,833	)		2,043,089
FUTURE INCOME TAXES			38,685		8,305			—			46,990
OTHER LIABILITIES			41,595		1,901			—			43,496
NON-CONTROLLING INTEREST			1,838		—			—			1,838
TOTAL LIABILITIES			2,776,193		946,521			(895,778	)		2,826,936
SHAREHOLDER'S EQUITY
	Capital stock		301,801		489,241			(489,241	)		301,801
	Retained earnings		248,712		155,997			(155,997	)		248,712
	Contributed surplus		—		1,751			(1,751	)		—
	Other comprehensive income		7,976		(36	)		—			7,940
TOTAL SHAREHOLDER'S EQUITY			558,489		646,953			(646,989	)		558,453
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY		$	3,334,682	$	1,593,474		$	(1,542,767	)	$	3,385,389

F-37

CONSOLIDATING STATEMENT OF INCOME

For the year ended December 31, 2002

		Sun Media			Combined Guarantors			Adjustments and Eliminations			Consolidated
REVENUES		$	545,309		$	311,940		$	(3,639	)	$	853,610
OPERATING EXPENSES
	Wages and employee benefits		198,702			119,344			—			318,046
	Newsprint		61,842			41,916			—			103,758
	Other operating expenses		140,587			73,480			(3,639	)		210,428
			401,131			234,740			(3,639	)		632,232
OPERATING INCOME BEFORE THE UNDERNOTED			144,178			77,200			—			221,378
Restructuring costs			1,427			768			—			2,195
Depreciation and amortization			15,169			11,866			—			27,035
Financial expenses			166,346			62,705			—			229,051
Dividend income			(137,123	)		(66,045	)		—			(203,168	)
INCOME BEFORE TAXES, EQUITY EARNINGS OF COMBINED GUARANTORS AND NON-CONTROLLING INTEREST			98,359			67,906			—			166,265
Income taxes			(16,568	)		449			—			(16,119	)
Equity earnings of combined guarantors			(67,457	)		—			67,457			—
Non-controlling interest			1,118			—			—			1,118
NET INCOME		$	181,266		$	67,457		$	(67,457	)	$	181,266

CONSOLIDATING STATEMENT OF RETAINED EARNINGS

For the year ended December 31, 2002

	Sun Media			Combined Guarantors			Adjustments and Eliminations			Consolidated
RETAINED EARNINGS, BEGINNING OF YEAR	$	138,621		$	105,407		$	(105,407	)	$	138,621
Net income		181,266			67,457			(67,457	)		181,266
Dividends on common stock		(70,945	)		(13,000	)		13,000			(70,945	)
Distribution to QMI		(230	)		—			—			(230	)
Accumulated deficit on transfer of Gratte-Ciel		—			(3,867	)		3,867			—
RETAINED EARNINGS, END OF YEAR	$	248,712		$	155,997		$	(155,997	)	$	248,712

F-38

18. MATERIAL DIFFERENCES BETWEEN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (GAAP) IN CANADA AND THE UNITED STATES (Continued)

CONSOLIDATING STATEMENT OF CASH FLOWS
For the year ended December 31, 2002

			Sun Media			Combined Guarantors			Adjustments and Eliminations			Consolidated
CASH PROVIDED BY (USED FOR):
OPERATIONS
	Net income		$	181,266		$	67,457		$	(67,457	)	$	181,266
	Items not involving cash:
		Depreciation and amortization		15,169			11,866			—			27,035
		Future income taxes		(1,465	)		6,428			—			4,963
		Non-controlling interest		1,118			—			—			1,118
		Equity earnings of combined guarantors		(67,457	)		—			67,457			—
		Other		316			(899	)		—			(583	)
	Changes in non-cash operating working capital			(27,371	)		16,781			—			(10,590	)
				101,576			101,633			—			203,209
FINANCING
	Issuance of convertible obligation			—			350,000			—			350,000
	Loans			1,844			—			—			1,844
	Repayment of loans			(39,085	)		—			—			(39,085	)
	Dividends on capital stock			(70,945	)		(13,000	)		13,000			(70,945	)
	Other			(1,186	)		—			—			(1,186	)
				(109,372	)		337,000			13,000			240,628
INVESTING
	Investment in Quebecor Media Inc.			—			(350,000	)		—			(350,000	)
	Business acquisitions, net of cash			(756	)		—			—			(756	)
	Dispositions, net of cash			—			925			—			925
	Increase in short-term investments			—			(74,419	)		—			(74,419	)
	Additions to fixed assets			(7,024	)		(3,285	)		—			(10,309	)
	Proceeds from disposal of fixed assets			29			2,571			—			2,600
	Dividends received from combined guarantors			13,000			—			(13,000	)		—
				5,249			(424,208	)		(13,000	)		(431,959	)
Increase (decrease) in cash				(2,547	)		14,425			—			11,878
Cash and cash equivalents—beginning of year				3,364			35,804			—			39,168
Cash and cash equivalents—end of year			$	817		$	50,229		$	—		$	51,046

F-39

19. SUBSEQUENT EVENT

        On February 7, 2003, the Company completed an offering of US $205,000 aggregate principal amount of 7⁵/8% Senior Notes due 2013. Concurrently with this offering, the Company entered into a new secured credit facility consisting of a five-year revolving credit facility of $75,000 and a six-year term loan B of US $230,000. The proceeds were used to repay borrowings under the Company's existing credit facility, which, as of December 31, 2002 amounted to $300,500, redeem the Company's existing Senior Subordinated Notes, which, as of December 31, 2002 amounted to $214,600, pay dividends to QMI, and for general corporate purposes.

F-40

Sun Media Corporation

Offer to Exchange All Outstanding US$205,000,000
Principal Amount of
7⁵/8% Senior Notes due 2013
for US$205,000,000 Principal Amount of
7⁵/8% Senior Notes due 2013
That Have Been Registered Under the Securities Act of 1933

PROSPECTUS

No dealer, salesperson or other person is authorized
to give any information or to represent anything not contained in this prospectus.
You must not rely on any unauthorized information or representations.
This prospectus is an offer to exchange only the old notes for the new notes
in accordance with the terms included in this prospectus, but only under circumstances
and in jurisdictions where it is lawful to do so.
The information contained in this prospectus is current only as of its date.
Until    , 2003, all dealers that effect transactions in these securities,
whether or not participating in this offering, may be required to deliver a prospectus.
This is in addition to the dealers' obligation to deliver a prospectus when acting as
underwriters and with respect to their unsold allotments or subscriptions.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 20.    Indemnification of Officers and Directors.

        Each of the following summaries is qualified in its entirety by reference to the complete text of the applicable statutes, certificates of incorporation and bylaws referred to below.

        Each of Sun Media Corporation ("Sun Media"), Sun Media (Toronto) Corporation ("Sun Media Toronto") and Bowes Publishers Limited ("Bowes") has been continued under the laws of British Columbia.

        The Company Act (British Columbia) provides that a company, with the approval of the British Columbia Supreme Court, may indemnify a person who is a director or former director of such company or who is a director or former director of a corporation of which the company is or was a shareholder, and the person's heirs and personal representatives, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, actually and reasonably incurred by the person, including an amount paid to settle an action or satisfy a judgment in a civil, criminal or administrative action or proceeding to which the person is made a party because of being or having been a director, including an action brought by the company or corporation, if:

        (a)  the person acted honestly and in good faith with a view to the best interests of the corporation of which the person is or was a director, and

        (b)  in the case of a criminal or administrative action or proceeding, the person had reasonable grounds for believing that his or her conduct was lawful.

        The Company Act (British Columbia) also permits a company to purchase and maintain insurance for the benefit of a person referred to above against any liability incurred by the person as a director or officer.

        The Articles of each of Sun Media, Sun Media Toronto and Bowes provide for the indemnification of directors, officers, employees and agents of the relevant corporation, as well as persons who act at the request of such corporation as a director, officer, employee or agent of another legal entity. The Articles further specifically permit Sun Media, Sun Media Toronto, or Bowes, as the case may be, to purchase and maintain insurance for the benefit of its directors, officers, employees and agents, as well as for persons who serve at the request of such corporation as a director, officer, employee or agent of another legal entity.

        SMC Nomineeco Inc. ("Nomineeco") is incorporated under the laws of the Province of Ontario. Section 136 of the Business Corporations Act (Ontario) (the "OBCA") provides that a corporation may indemnify its directors and officers. Section 6.2 of Nomineeco's By-Law No. 1 provides that the corporation shall indemnify and save harmless every director and officer of the corporation, every former director or officer and every person who acts or acted at the corporation's request as a director or officer of a body corporate of which the corporation is or was a shareholder or creditor (or a person who undertakes or has undertaken any liability on behalf of the corporation or any such body corporate) and his heirs and legal representatives, from and against all costs, charges and expenses, including any amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of the corporation or such body corporate, if (a) he acted honestly and in good faith with a view to the best interests of the corporation and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful.

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        Section 6.1 of Nomineeco's By-Law No. 1 further provides that no director or officer shall be liable for the acts, receipts, neglects or defaults of any other director, officer, employee, or agent, or for joining in any receipt or other act for conformity, or for any loss, damage or expense happening to the corporation through the insufficiency or deficiency of title to any property acquired for or on behalf of the corporation, or for the insufficiency or deficiency of any security in or upon which any of the moneys of the corporation shall be invested, or for any loss or damage arising from the bankruptcy, insolvency or tortious acts of any person with whom any of the moneys, securities or effects of the corporation shall be deposited, or for any loss occasioned by any error of judgment or oversight on his part, or for any other loss, damage or misfortune whatever which shall happen in the execution of the duties of his office or in wilful neglect or default; provided that nothing in By-Law No. 1 shall relieve any director or officer from the duty to act in accordance with the OBCA or from liability for any breach thereof.

        Each of Toronto Sun International, Inc., TS Printing, Inc. and Florida Sun Publications, Inc. is incorporated under the laws of the State of Delaware. Section 145 of the Delaware General Corporation Law (the "DGCL") provides that a corporation shall have the power to indemnify any person made a party to any action, suit or proceeding by reason of such person being a director, officer, employee or agent of the corporation (or serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise). The DGCL permits indemnification where such person acted in good faith and in a manner that such person reasonably believed to be in, or not opposed to, the corporation's best interests and, in a criminal action, if such person had no reasonable cause to believe that his or her conduct was unlawful. In the case of a claim by a third party, the DGCL permits indemnification for expenses, judgments, settlement payments and other costs. In the case of a claim by or in the right of the corporation, the DGCL permits a corporation to indemnify for expenses; however, such indemnification is not permitted where the person seeking indemnification is adjudged liable to the corporation, unless the indemnification is ordered by a court. The DGCL also permits advancement of expenses to a director or officer upon receipt of an undertaking by such director or officer to repay all amounts advanced if it shall ultimately be determined that he or she is not entitled to be indemnified by the corporation. The DGCL provides that its terms shall not be deemed exclusive of any other right to indemnification to which those seeking indemnification may be entitled under any by-law, agreement, or vote of stockholders or disinterested directors. Any indemnification or advanced expenses granted under the provisions described above shall continue even after the person seeking indemnification has ceased to be a director, officer, employee or agent of the corporation, and shall inure to the benefit of such person's heirs, executors or administrators.

        The certificates of incorporation and by-laws of TS Printing, Inc. and Florida Sun Publications, Inc. provide for indemnification to the fullest extent authorized by the DGCL as it exists or may be later amended (except, in the case of amendment, only to the extent that such amendment permits the respective corporation to provide broader indemnification rights than previously permitted). They further provide that a person seeking indemnification from the respective corporation may bring suit against such corporation if it fails to pay a claim for indemnification (a) within 60 days of written receipt of the claim, or (b) within 20 days of written receipt, in the case of a claim for an advance payment of expenses. In such suit, if the person seeking indemnification is adjudged as failing to meet the applicable standard of conduct set forth in the DGCL, such failure shall be a defense to the respective corporation's non-payment. In the event that the respective corporation has already advanced expenses to such person, such failure shall entitle the respective corporation to recover its advancement.

        The by-laws of Toronto Sun International, Inc. provide for indemnification to the full extent permitted by the DGCL. As permitted under Section 102(b)(7) of the DGCL, Toronto Sun International, Inc.'s certificate of incorporation also states expressly that no director shall be held liable

II-2

to either the corporation or its shareholders for monetary damages for any breach of fiduciary duty as a director. Section 102(b)(7) of the DGCL prohibits the elimination or limitation of such liability only in the case of (i) any breach of the director's duty of loyalty to the corporation or its shareholders; (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of the law; (iii) unlawful payment of dividends or unlawful stock purchases or redemptions; or (iv) any transaction from which the director derived an improper personal benefit.

        Each of 3661458 Canada Inc. ("3661458") and 3351611 Canada Inc. ("3351611") is incorporated under the laws of Canada. Section 124 of the Canada Business Corporations Act (the "CBCA") provides that a corporation may indemnify its directors and officers. Section 6.2 of 3661458's By-Law No. 1 and Section 15 of 3351611's By-Law No. One both provide that the corporation shall indemnify and save harmless every director and officer of the corporation, every former director or officer and every person who acts or acted at the corporation's request as a director or officer of another body corporate, and his heirs and legal representatives, against all costs, charges and expenses, including any amount paid to settle an action or satisfy a judgment, reasonably incurred by him in respect of any civil, criminal or administrative action or proceeding to which he is made a party by reason of being or having been a director or officer of the corporation or another body corporate, if (a) he acted honestly and in good faith with a view to the best interests of the corporation and (b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, he had reasonable grounds for believing that his conduct was lawful.

        Section 6.1 of 3661458's By-Law No. 1 further provides that no director or officer shall be liable for the acts, receipts, neglects or defaults of any other director, officer, employee, or agent, or for joining in any receipt or other act for conformity, or for any loss, damage or expense happening to the corporation through the insufficiency or deficiency of title to any property acquired for or on behalf of the corporation, or for the insufficiency or deficiency of any security in or upon which any of the moneys of the corporation shall be invested, or for any loss or damage arising from the bankruptcy, insolvency or tortious acts of any person with whom any of the moneys, securities or effects of the corporation shall be deposited, or for any loss occasioned by any error of judgment or oversight on his part, or for any other loss, damage or misfortune whatever which shall happen in the execution of the duties of his office or in wilful neglect or default; provided that nothing in By-Law No. 1 shall relieve any director or officer from the duty to act in accordance with the CBCA or from liability for any breach thereof.

Item 21.    Exhibits and Financial Statement Schedules.

(a)

Exhibits.

        The exhibits to this registration statement are listed in the Exhibit Index to this registration statement, which Exhibit Index is hereby incorporated by reference.

(b)

Financial Statement Schedules.

        Schedule II — Valuation and Qualifying Accounts for the three years ended December 31, 2002 are included in the registration statement as Exhibit 12.3.

Item 22.    Undertakings.

(a)  Each undersigned registrant hereby undertakes:

        (1)  to file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement;

          (i)  to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

II-3

        (ii)  to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of a prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and

        (iii)  to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

        (2)  that, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof;

        (3)  to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering; and

        (4)  to file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Act need not be furnished, provided, that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements.

(b)  Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of any of the registrants pursuant to the provisions described under Item 20 above, or otherwise, each registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by a registrant of expenses incurred or paid by a director, officer or controlling person of such registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, such registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

(c)  Each undersigned registrant hereby undertakes: (i) to respond to requests for information that is incorporated by referenced into the prospectus pursuant to Item 4, 10(b), 11 or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means; and (ii) to arrange or provide for a facility in the U.S. for the purpose of responding to such requests. The undertaking in subparagraph (i) above includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

(d)  Each undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

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SIGNATURES

        Pursuant to the requirements of the Securities Act, each co-registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Province of Québec, Canada on this 24th day of March, 2003.

SUN MEDIA CORPORATION
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer
BOWES PUBLISHERS LIMITED
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer
SUN MEDIA (TORONTO) CORPORATION
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer
SMC NOMINEECO INC.
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer
TORONTO SUN INTERNATIONAL, INC.
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer
TS PRINTING, INC.
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer

II-5

FLORIDA SUN PUBLICATIONS, INC.
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer
3661458 CANADA INC.
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President and Chief Executive Officer
3351611 CANADA INC.
By:	/s/  PIERRE FRANCOEUR
	Name: Pierre Francoeur Title: President

II-6

POWER OF ATTORNEY

        KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Pierre Francoeur, Director, President and Chief Executive Officer of Sun Media Corporation, and Kin-Man Lee, Vice President, Corporate Controller, and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution for him or her and in his or her name, place and stead, in any and all capacities, to sign, execute and file this registration statement and any amendments (including, without limitation, post-effective amendments) to this registration statement, and to file the same, with all exhibits thereto and all documents required to be filed with respect therewith, with the Securities and Exchange Commission or any regulatory authority, granting unto such attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith and about the premises in order to effectuate the same as fully to all intents and purposes as he or she might or could do if personally present, hereby ratifying and confirming all that such attorneys-in-fact and agents or his or her or their substitute or substitutes may lawfully do or cause to be done.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

SUN MEDIA CORPORATION

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Vice President, Corporate Controller	March 24, 2003
/s/  CLAUDE BERGERON
Claude Bergeron	Director	March 24, 2003
/s/  PIERRE KARL PÉLADEAU
Pierre Karl Péladeau	Director and Chairman of the Board	March 24, 2003
/s/  THOMAS A. ROPER
Thomas A. Roper	Director	March 18, 2003

II-7

BOWES PUBLISHERS LIMITED

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director and Vice President, Corporate Controller	March 24, 2003
/s/  WILLIAM R. DEMPSEY
William R. Dempsey	Director and Executive Vice President	March 24, 2003
/s/  THOMAS A. ROPER
Thomas A. Roper	Director	March 19, 2003

SUN MEDIA (TORONTO) CORPORATION

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director and Vice President, Corporate Controller	March 24, 2003
/s/  LESTER PYETTE
Lester Pyette	Director	March 24, 2003
/s/  THOMAS A. ROPER
Thomas A. Roper	Director	March 18, 2003

II-8

SMC NOMINEECO INC.

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director and Vice President, Corporate Controller	March 24, 2003
/s/  LESTER PYETTE
Lester Pyette	Director	March 24, 2003

TORONTO SUN INTERNATIONAL, INC.

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director and Vice President, Corporate Controller	March 24, 2003
/s/  EDWIN GRAY
Edwin Gray	Director	March 24, 2003

II-9

TS PRINTING, INC.

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director and Vice President, Corporate Controller	March 24, 2003
/s/  EDWIN GRAY
Edwin Gray	Director and Controller	March 24, 2003

FLORIDA SUN PUBLICATIONS, INC.

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director and Vice President, Corporate Controller	March 24, 2003
/s/  EDWIN GRAY
Edwin Gray	Director and Executive Vice President	March 24, 2003

II-10

3661458 CANADA INC.

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director, President and Chief Executive Officer	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director, and Vice President, Corporate Controller	March 24, 2003
/s/  LESTER PYETTE
Lester Pyette	Director and Vice President	March 24, 2003

3351611 CANADA INC.

Name and Signature	Title	Date
/s/  PIERRE FRANCOEUR
Pierre Francoeur	Director and President	March 24, 2003
/s/  KIN-MAN LEE
Kin-Man Lee	Director	March 24, 2003
/s/  WILLIAM R. DEMPSEY
William R. Dempsey	Director	March 24, 2003

II-11

        Pursuant to the requirements of Section 6(a) of the Securities Act of 1933, the undersigned certifies that it is the duly authorized United States representative of each co-registrant and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Province of Ontario, Canada this 24th day of March, 2003.

TORONTO SUN INTERNATIONAL, INC. (Authorized U.S. Representative)
By:	/s/  KIN-MAN LEE
	Name: Kin-Man Lee Title: Vice President, Corporate Controller

II-12

EXHIBIT INDEX

1.1	Purchase Agreement dated as of January 30, 2003 by and among Sun Media Corporation, the subsidiary guarantors signatory thereto and Salomon Smith Barney Inc., RBC Dominion Securities Corporation, TD Securities (USA) Inc., BMO Nesbitt Burns Corp., Credit Suisse First Boston Corporation, Scotia Capital (USA) Inc. and CIBC World Markets Corp.
3.1	Certificate and Articles of Continuance of Sun Media Corporation dated February 12, 1999 (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 1998).
3.2	Certificate and Articles of Amalgamation of Sun Media Corporation dated February 28, 1999 (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 1998).
3.3	Certificate and Articles of Continuance of Sun Media Corporation dated July 3, 2001 (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 2001).
3.4	By-laws of Sun Media Corporation (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 2001).
3.5	Articles of Incorporation of Bowes Publishers Limited, including amendments thereto.
3.6	By-laws of Bowes Publishers Limited.
3.7	Articles of Incorporation of Sun Media (Toronto) Corporation, including amendments thereto.
3.8	By-laws of Sun Media (Toronto) Corporation.
3.9	Articles of Incorporation of SMC Nomineeco Inc.
3.10	By-laws of SMC Nomineeco Inc.
3.11	Articles of Incorporation of Toronto Sun International, Inc.
3.12	By-laws of Toronto Sun International, Inc.
3.13	Articles of Incorporation of TS Printing, Inc., including amendments thereto.
3.14	By-laws of TS Printing, Inc.
3.15	Articles of Incorporation of Florida Sun Publications, Inc. (formerly TS Printing (Florida), Inc.), including amendments thereto.
3.16	By-laws of Florida Sun Publications, Inc. (formerly TS Printing (Florida), Inc.).
3.17	Articles of Incorporation of 3661458 Canada Inc.
3.18	By-laws of 3661458 Canada Inc.
3.19	Articles of Incorporation of 3351611 Canada Inc.
3.20	By-laws of 3351611 Canada Inc.
4.1	Form of 75/8% Senior Note due 2013 of Sun Media Corporation being registered pursuant to the Securities Act of 1933 (included in Exhibit A to Exhibit 4.2 below).
4.2	Indenture dated as of February 7, 2003 among Sun Media Corporation, the subsidiary guarantors signatory thereto and National City Bank, as trustee.

4.3	Registration Rights Agreement dated as of February 7, 2003 by and among Sun Media Corporation, the subsidiary guarantors signatory thereto and Salomon Smith Barney Inc., RBC Dominion Securities Corporation, TD Securities (USA) Inc., BMO Nesbitt Burns Corp., Credit Suisse First Boston Corporation, Scotia Capital (USA) Inc. and CIBC World Markets Corp.
4.4	Subordination Agreement dated as of February 7, 2003 among Sun Media Corporation, Quebecor Media Inc. and National City Bank.
5.1	Opinion of Arnold & Porter, U.S. counsel to Sun Media Corporation, dated March 24, 2003.
5.2	Opinion of Ogilvy Renault, Canadian counsel to Sun Media Corporation, dated March 24, 2003.
8.1	Opinion of Arnold & Porter, U.S. counsel to Sun Media Corporation, dated March 24, 2003, regarding U.S. federal income tax considerations.
8.2	Opinion of Ogilvy Renault, Canadian counsel to Sun Media Corporation, regarding Canadian federal income tax considerations (included in Exhibit 5.2 above).
10.1	Employment Agreement dated January 13, 1998 for William R. Dempsey (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 1997).
10.2	Employment Agreement dated January 13, 1998 for J. Craig Martin (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 1997).
10.3	Employment Agreement dated January 13, 1998 for Lester Pyette (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 1997).
10.4	Credit Agreement dated as of February 7, 2003 among Sun Media Corporation, Bank of America, N.A., Banc of America Securities LLC and Credit Suisse First Boston Corporation, as arrangers, Bank of America, N.A., as administrative agent, and certain other financial institutions signatory thereto.
10.5	Subordination Agreement for Existing Back-To-Back Securities dated as of February 7, 2003 between Sun Media Corporation and Quebecor Media Inc.
10.6	Newsprint Supply Agreement dated as of January 1, 2000 among Sun Media Corporation, Donohue Forest Products and Quebecor Printing Inc., together with an English summary of the agreement (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 2000).
10.7	12.15% Convertible Obligation ("CANCAP") due July 14, 2007 between Sun Media Corporation and Quebecor Media Inc., dated July 9, 2001 (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 2001).
10.8	12.15% Convertible Obligation ("CANCAP") due July 14, 2007 between Bowes Publishers Limited and Sun Media Corporation, dated July 9, 2001 (incorporated by reference to the applicable exhibit to Sun Media Corporation's Annual Report on Form 20-F for the year ended December 31, 2001).
10.9	12.15% Convertible Obligation ("CANCAP") due November 28, 2008 between Sun Media Corporation and Quebecor Media Inc., dated November 28, 2002.
10.10	12.25% Convertible Obligation ("CANCAP") due November 28, 2008 between Sun Media (Toronto) Corporation and Sun Media Corporation, dated November 28, 2002.

10.11	Management Services Agreement dated January 17, 2003 between Quebecor Media Inc. and Sun Media Corporation.
12.1	Statement of Computation of Ratio of Earnings to Fixed Charges.
12.2	Statement of Computation of Ratio of Total Debt to EBITDA.
12.3	Schedule of Valuation and Qualifying Accounts.
21.1	Subsidiaries of Sun Media Corporation.
23.1	Consent of KPMG LLP, dated March 24, 2003.
23.2	Consent of Arnold & Porter, U.S. counsel to Sun Media Corporation (included in Exhibits 5.1 and 8.1 above).
23.3	Consent of Ogilvy Renault, Canadian counsel to Sun Media Corporation (included in Exhibit 5.2 above).
24.1	Powers of Attorney (included on signature pages to this registration statement).
25.1	Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of National City Bank, as trustee, on Form T-1.
99.1	Form of Letter of Transmittal.
99.2	Form of Notice of Guaranteed Delivery.
99.3	Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other nominees.
99.4	Form of Letter to Clients.

QuickLinks

TABLE OF ADDITIONAL REGISTRANTS
TABLE OF CONTENTS
INDUSTRY AND MARKET DATA
ENFORCEABILITY OF CIVIL LIABILITIES
FORWARD-LOOKING STATEMENTS
PRESENTATION OF FINANCIAL INFORMATION
EXCHANGE RATES
SUMMARY
Our Corporate History and Structure
RISK FACTORS
USE OF PROCEEDS
CAPITALIZATION
SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
BUSINESS
MANAGEMENT
OUR SHAREHOLDER
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
DESCRIPTION OF CERTAIN INDEBTEDNESS
THE EXCHANGE OFFER
Purpose and Effect of the Exchange Offer
Terms of the Exchange Offer
Conditions to the Exchange Offer
Expiration Date; Extensions; Amendments
Procedures for Tendering Old Notes
Acceptance of Old Notes; Delivery of New Notes
Withdrawal Rights
Exchange Agent
Fees and Expenses
Transfer Taxes
Accounting Treatment
Consequences of Failure to Exchange Old Notes
Resale of the New Notes
DESCRIPTION OF THE NOTES
TAX CONSIDERATIONS
PLAN OF DISTRIBUTION
LEGAL MATTERS
INDEPENDENT AUDITORS
WHERE YOU CAN FIND MORE INFORMATION
INDEX TO HISTORICAL FINANCIAL STATEMENTS
AUDITORS' REPORT TO THE DIRECTORS OF SUN MEDIA CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY
CONSOLIDATED STATEMENTS OF CASH FLOWS
CONSOLIDATED BALANCE SHEETS
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
PART II
PART II – INFORMATION NOT REQUIRED IN PROSPECTUS
SIGNATURES
POWER OF ATTORNEY
EXHIBIT INDEX

EX-1.1

                                                                     EXHIBIT 1.1


                              SUN MEDIA CORPORATION

                                 US$205,000,000

                          7-5/8% Senior Notes due 2013

                               Purchase Agreement

                                                             New York, New York
                                                               January 30, 2003


Salomon Smith Barney Inc.
RBC Dominion Securities Corporation
TD Securities (USA) Inc.
BMO Nesbitt Burns Corp.
Credit Suisse First Boston Corporation
Scotia Capital (USA) Inc.
CIBC World Markets Corp.

c/o Salomon Smith Barney Inc.
388 Greenwich Street
New York, New York  10013

Ladies and Gentlemen:

                  Sun Media Corporation, a company continued under the laws of
the Province of British Columbia (the "Company"), proposes to issue and sell to
the several parties named in Schedule I hereto as initial purchasers (the
"Initial Purchasers"), US$205,000,000 principal amount of its 7-5/8% Senior
Notes due 2013 (the "Notes," and the Notes together with the Guarantees (as
defined below), the "Securities"). The Securities are to be issued under an
indenture (the "Indenture"), to be dated as of the Closing Date (as defined
below), among the Company, the Subsidiary Guarantors (as defined below) and
National City Bank, as trustee (the "Trustee"). The Securities will have the
benefit of a registration rights agreement (the "Registration Rights
Agreement"), to be dated as of the Closing Date, among the Company, the
Subsidiary Guarantors and the Initial Purchasers, pursuant to which the Company
has agreed to register a new series of notes (the "Exchange Notes") and the
Subsidiary Guarantors have agreed to register the related guarantees (the
"Exchange Guarantees," and, together with the Exchange Notes, the "Exchange
Securities") under the Act subject to the terms and conditions therein
specified. Pursuant to the Registration Rights Agreement, the Exchange
Securities will be offered in exchange for the Securities (the "Registered
Exchange Offer"). The Notes will be unconditionally guaranteed (the
"Guarantees") by each of the Company's direct and indirect Subsidiaries set
forth on the signature page hereto (the "Subsidiary Guarantors"). The term
Initial Purchasers as used herein shall mean either the singular or plural as
the context requires. The use of the neuter in this Agreement shall include the
feminine and masculine wherever appropriate. Certain capitalized terms used
herein are defined in Section 17 hereof.






                  The sale of the Securities to the Initial Purchasers will be
made without registration of the Securities under the Act in reliance upon
exemptions from the registration requirements of the Act.

                  In connection with the sale of the Securities, the Company has
prepared a preliminary offering memorandum, dated January 17, 2003 (as amended
or supplemented at the Execution Time, including any and all exhibits thereto
and wrappers thereof and including the Preliminary Canadian Offering Memorandum,
dated January 17, 2003 and the Preliminary Offering Memorandum Supplement, dated
January 27, 2003, the "Preliminary Memorandum"), and a final offering
memorandum, dated as of the date hereof (as amended or supplemented at the
Execution Time, including any and all exhibits thereto and wrappers thereof and
including the Canadian Offering Memorandum, dated as of the date hereof, the
"Final Memorandum"). Each of the Preliminary Memorandum and the Final Memorandum
sets forth certain information concerning the Company and the Securities. The
Company hereby confirms that it has authorized the use of the Preliminary
Memorandum and the Final Memorandum, and any amendment or supplement thereto, in
connection with the offer and sale of the Securities by the Initial Purchasers.

                  1.   REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE
SUBSIDIARY GUARANTORS. The Company and the Subsidiary Guarantors, jointly and
severally, represent and warrant to and agree with each Initial Purchaser as set
forth below in this Section 1.

                  (a)  The Preliminary Memorandum, at the date thereof, did not
            contain any untrue statement of a material fact or omit to state any
            material fact necessary to make the statements therein, in the light
            of the circumstances under which they were made, not misleading. At
            the Execution Time and on the Closing Date, the Final Memorandum did
            not, and will not (and any amendment or supplement thereto, at the
            date thereof and on the Closing Date will not), contain any untrue
            statement of a material fact or omit to state any material fact
            necessary to make the statements therein, in the light of the
            circumstances under which they were made, not misleading. The
            preceding two sentences do not apply to statements in or omissions
            from the Preliminary Memorandum or Final Memorandum based upon
            written information furnished to the Company by or on behalf of any
            Initial Purchaser through Salomon Smith Barney specifically for use
            therein, it being understood and agreed that the only such
            information is that described as such in Section 8(b) hereof.

                  (b)  The Company has been duly constituted and is an existing
            company in good standing under the laws of the Province of British
            Columbia, with power and authority (corporate and other) to own or
            lease, as the case may be, and operate its properties and conduct
            its business as described in the Final Memorandum; and the Company
            is duly qualified or registered to carry on business as a foreign or
            extra-provincial corporation in good standing in all other
            jurisdictions in which its ownership or lease of property or the
            conduct of its business requires such qualification except where the
            failure to be so qualified or in good standing (i) would not
            reasonably be expected to have a material adverse effect on the
            performance by the Company of its obligations under this Agreement,
            the Indenture, the Securities or the Registration Rights Agreement
            or (ii) would not individually or in the aggregate, have a material
            adverse


                                       2




            effect on the condition (financial or otherwise), business,
            properties, results of operations or prospects of the Company and
            its Subsidiaries taken as a whole ("Material Adverse Effect")
            whether or not arising from transactions in the ordinary course of
            business. The Company has a capitalization as set forth in the Final
            Memorandum under the caption headed "Capitalization," and all of the
            issued and outstanding shares in the capital of the Company have
            been duly and validly authorized and issued and are fully paid and
            non-assessable.

                  (c)  The Subsidiaries of the Company listed on Exhibit B
            hereto (the "Material Subsidiaries") include all of the Subsidiaries
            material to the assets and operations of the Company.

                  (d)  Each Material Subsidiary of the Company has been duly
            incorporated and is an existing corporation in good standing under
            the laws of the jurisdiction in which it is incorporated, organized
            or chartered, with power and authority (corporate and other) to own
            its properties and conduct its business as described in the Final
            Memorandum; and each Material Subsidiary of the Company is duly
            qualified or registered to do business as a foreign or
            extra-provincial corporation in good standing in all other
            jurisdictions in which its ownership or lease of property or the
            conduct of its business requires such qualification except to the
            extent that the failure to be so qualified or in good standing would
            not reasonably be expected to have a Material Adverse Effect. All of
            the issued and outstanding shares in the capital of each Material
            Subsidiary have been duly authorized and validly issued and are
            fully paid and nonassessable and are owned directly or indirectly by
            the Company, free and clear from all liens, encumbrances, defects,
            equities or claims, except as set forth under the caption
            "Description of Certain Indebtedness" in the Final Memorandum.

                  (e)  Each of the Indenture and the Registration Rights
            Agreement has been duly authorized by each of the Company and the
            Subsidiary Guarantors; the Securities and Exchange Securities have
            been duly authorized by each of the Company and the Subsidiary
            Guarantors; and when the Securities are delivered and paid for
            pursuant to this Agreement on the Closing Date (and, when the
            Company and the Subsidiary Guarantors have duly executed each global
            certificate representing the Exchange Securities and such Exchange
            Securities have been authenticated, in accordance with the
            provisions of the Indenture and delivered to the holders of Notes in
            exchange therefor as contemplated by the Registration Rights
            Agreement), and the Indenture and the Registration Rights Agreement
            will have been duly executed and delivered, such Securities and
            Exchange Securities will have been duly executed, authenticated,
            issued and delivered and will conform to the descriptions thereof
            contained in the Final Memorandum, and the Indenture, the
            Registration Rights Agreement and such Securities and Exchange
            Securities will constitute valid and legally binding obligations of
            the Company and the Subsidiary Guarantors, enforceable in accordance
            with their terms, subject to bankruptcy, insolvency, fraudulent
            transfer, reorganization, moratorium and similar laws of general
            applicability relating to or affecting creditors' rights and to
            general equity principles.


                                       3




                  (f)  Except as disclosed in the Final Memorandum, there are
            no contracts, agreements or understandings between the Company and
            any person that would give rise to a valid claim against the Company
            or any Initial Purchaser for a brokerage commission, finder's fee or
            other like payment.

                  (g)  Each of the Company and the Subsidiary Guarantors has all
            requisite power and authority (corporate and otherwise) and has
            taken all requisite action (corporate and otherwise) necessary to
            enter into and perform this Agreement, the Indenture, the
            Securities, the Exchange Securities and the Registration Rights
            Agreement. No consent, approval, authorization, or order of, or
            filing with, any governmental agency or body or any court is
            required for the consummation of the transactions contemplated by
            this Agreement, the Indenture or the Registration Rights Agreement
            in connection with the issuance and sale of the Securities and
            Exchange Securities by the Company except for the order of the
            Commission declaring the Exchange Offer Registration Statement or
            the Shelf Registration Statement (each as defined in the
            Registration Rights Agreement) effective and except such as may be
            required under the securities or Blue Sky laws of the various states
            and except for the filing of notices of private placement and the
            payment of filing fees required by the securities legislation of
            certain provinces in Canada, to the extent any Securities are sold
            by private placement therein.

                  (h)  Except as disclosed in the Final Memorandum, under
            current laws and regulations of Canada and any political subdivision
            thereof, all interest, principal, premium, if any, and other
            payments due or made on the Securities may be paid by the Company to
            the holder thereof in United States dollars that may be converted
            into foreign currency and freely transferred out of Canada and all
            such payments made to holders thereof who are non-residents of
            Canada for the purposes of the Income Tax Act (Canada) (other than
            holders who (i) use or hold, or are deemed to use or hold, the
            Securities in the course of carrying on a business in Canada, (ii)
            are persons who carry on an insurance business in Canada and
            elsewhere, or (iii) who do not deal at arm's length with the
            Company) will not be subject to income, withholding or other taxes
            under laws and regulations of Canada or any political subdivision or
            taxing authority thereof or therein and will otherwise be free and
            clear of any other tax, duty, withholding or deduction in Canada or
            any political subdivision thereof or by any taxing authority thereof
            or therein and without the necessity of obtaining any governmental
            authorization in Canada or any political subdivision or taxing
            authority thereof or therein.

                  (i)  Neither the Company nor any of its Material Subsidiaries
            is (i) in violation of its respective constituting documents or
            by-laws, or (ii) in default in the performance or observance of any
            obligation, agreement, covenant or condition contained in any
            indenture, loan agreement, deed of trust, mortgage, lease or other
            agreement or instrument to which the Company or any of its Material
            Subsidiaries is a party or by which the Company or any of its
            Material Subsidiaries or their respective property is bound, except,
            in the case of clause (ii) above, to the extent such violation or
            default would not have a Material Adverse Effect.

                  (j)  The execution, delivery and performance of this
            Agreement, the Indenture and the Registration Rights Agreement, and
            the issuance and sale of the


                                       4




            Securities and Exchange Securities and compliance with the terms and
            provisions hereof and thereof will not, (i) conflict with, or
            constitute a breach of, any of the terms or provisions of, or a
            default under, the constituting documents or by-laws, of the Company
            or any Subsidiary Guarantor, (ii) conflict with, or constitute a
            breach of, any of the terms or provisions of, or a default under,
            any indenture, loan agreement, deed of trust, mortgage, lease or
            other agreement or instrument to which the Company or any of the
            Subsidiary Guarantors is a party or by which the Company or any of
            the Subsidiary Guarantors or their respective property is bound,
            (iii) violate or conflict with any applicable law or any rule,
            regulation, judgment, order or decree of any court or any
            governmental body or agency having jurisdiction over the Company,
            any of the Subsidiary Guarantors or their respective property, (iv)
            result in the imposition or creation of (or the obligation to create
            or impose) a lien under, any agreement or instrument to which the
            Company or any of the Subsidiary Guarantors is a party or by which
            the Company or any of the Subsidiary Guarantors or their respective
            property is bound, or (v) result in the termination, suspension or
            revocation of any permits, licenses, consents, exemptions,
            franchises, authorizations and other approvals (each, an
            "Authorization") of the Company or any of the Subsidiary Guarantors
            or result in any other impairment of the rights of the holder of any
            such Authorization except, in the case of each of clauses (ii)
            through (v) above, for such violations that would not have a
            Material Adverse Effect.

                  (k)  This Agreement has been duly authorized, executed and
            delivered by the Company and each of the Subsidiary Guarantors.

                  (l)  Each of the Company and each of its Material Subsidiaries
            owns or leases all such properties as are necessary to the conduct
            of its operations as presently conducted. Except as disclosed in the
            Final Memorandum, including with respect to the Existing Credit
            Facility (as defined in Section 6(j) hereof), the Company and its
            Material Subsidiaries have good and marketable title to all real
            properties and all other properties and assets owned by them, in
            each case free from liens, encumbrances and defects that would
            materially affect the value thereof or materially interfere with the
            use made or to be made thereof by them; and except as disclosed in
            the Final Memorandum, the Company and its Material Subsidiaries hold
            any leased real or personal property under valid and enforceable
            leases with no exceptions that would have a Material Adverse Effect.

                  (m)  The Company and its Material Subsidiaries possess
            adequate certificates, authorities or permits of, and have made all
            filings with and notice to, all appropriate governmental agencies or
            bodies necessary to conduct the businesses now operated by them and
            have not received any notice of proceedings relating to the
            revocation or modification of any such certificate, authority or
            permit that, if determined adversely to the Company or any of its
            Material Subsidiaries would, individually or in the aggregate, have
            a Material Adverse Effect.

                  (n)  Except as disclosed in the Final Memorandum, there is no
            filing, license, consent, permission, approval, authorization or
            order of any court or governmental agency or body in Canada which is
            required to be obtained by the


                                       5




            Company or any of its Subsidiaries in order for the Company or any
            of its Subsidiaries to carry on their current or contemplated
            businesses and operations as described in the Final Memorandum,
            other than as would not have a Material Adverse Effect.

                  (o)  Except as disclosed in the Final Memorandum, no labor
            dispute with the employees of the Company or any Material Subsidiary
            exists or, to the knowledge of the Company, is imminent that could
            reasonably be expected to have a Material Adverse Effect.

                  (p)  Except as disclosed in the Final Memorandum, the Company
            and its Material Subsidiaries own, possess or can acquire on
            reasonable terms, adequate trademarks, trade names and other rights
            to inventions, know-how, patents, copyrights, confidential
            information and other intellectual property (collectively,
            "intellectual property rights") necessary to conduct the business
            now operated by them, or presently employed by them, and have not
            received any notice of infringement of or conflict with asserted
            rights of others with respect to any intellectual property rights
            that, if determined adversely to the Company or any of its Material
            Subsidiaries, would individually or in the aggregate have a Material
            Adverse Effect.

                  (q)  The Company and each of its Material Subsidiaries are
            insured by insurers of recognized financial responsibility against
            such losses and risks and in such amounts as are prudent and
            customary in the businesses in which they are engaged; and neither
            the Company nor any of its Material Subsidiaries (i) has received
            notice from any insurer or agent of such insurer that substantial
            capital improvements or other material expenditures will have to be
            made in order to continue such insurance or (ii) has any reason to
            believe that it will not be able to renew its existing insurance
            coverage as and when such coverage expires or to obtain similar
            coverage from similar insurers at a cost that would not have a
            Material Adverse Effect.

                  (r)  The Company and each of its Subsidiaries maintain a
            system of internal accounting controls sufficient to provide
            reasonable assurance that (i) transactions are executed in
            accordance with management's general or specific authorizations;
            (ii) transactions are recorded as necessary to permit preparation of
            financial statements in conformity with generally accepted
            accounting principles in Canada and to maintain asset
            accountability; (iii) access to assets is permitted only in
            accordance with management's general or specific authorization; and
            (iv) the recorded accountability for assets is compared with the
            existing assets at reasonable intervals and appropriate action is
            taken with respect to any differences.

                  (s)  Under current laws and regulations of Canada and any
            political subdivisions thereof, no withholding tax imposed under the
            federal laws of Canada or any political subdivision thereof will be
            payable in respect of the payment or crediting of any discount,
            commission or fee as contemplated by this Agreement to an Initial
            Purchaser that is not resident in Canada, but resident in the United
            States or if a partnership, all the members of which are not
            resident in Canada but resident in the United States, in each case,
            for purposes of the INCOME TAX ACT (Canada) and the CANADA-US INCOME
            TAX CONVENTION, 1980 (a "U.S. Purchaser") or any interest or deemed
            interest on the resale of


                                       6




            Securities by a U.S. Purchaser to U.S. residents, provided that such
            U.S. Purchaser deals at arm's-length with the Company and that any
            such discount, commission or fee is payable in respect of services
            rendered by such U.S. Purchaser outside of Canada, that are
            performed by such U.S. Purchaser in the ordinary course of business
            carried on by it that includes the performance of such services for
            a fee and any such amount is reasonable in the circumstances.

                  (t)  All material tax returns required to be filed by the
            Company and each of its Material Subsidiaries in any jurisdiction
            have been filed, other than any filings not yet due or being
            contested in good faith, and all material taxes, including
            withholding taxes, penalties and interest, assessments, fees and
            other charges due pursuant to such returns or pursuant to any
            assessment received by the Company or any of its Material
            Subsidiaries have been paid, other than those not yet payable or
            being contested in good faith and for which adequate reserves have
            been provided.

                  (u)  Expect as disclosed in the Final Memorandum, neither the
            Company nor any of its Material Subsidiaries is in violation of any
            statute, any rule, regulation, decision or order of any governmental
            agency or body or any court, domestic or foreign, relating to the
            use, disposal or release of hazardous or toxic substances or
            relating to the protection or restoration of the environment or
            human exposure to hazardous or toxic substances (collectively,
            "environmental laws"), owns or operates any real property
            contaminated with any substance that is subject to any environmental
            laws, is liable for any off-site disposal or contamination pursuant
            to any environmental laws, or is subject to any claim relating to
            any environmental laws, which violation, contamination, liability or
            claim would individually or in the aggregate have a Material Adverse
            Effect; and the Company is not aware of any pending investigation
            which might lead to such a claim.

                  (v)  Except as disclosed in the Final Memorandum, there are
            no pending actions, suits or proceedings against or affecting the
            Company, any of its Material Subsidiaries or any of their respective
            properties that, if determined adversely to the Company or any of
            its Material Subsidiaries, would individually or in the aggregate
            have a Material Adverse Effect, or would materially and adversely
            affect the ability of the Company to perform its obligations under
            this Agreement, the Indenture or the Registration Rights Agreement,
            or which are otherwise material in the context of the sale of the
            Securities; and, to the Company's knowledge, no such actions, suits
            or proceedings are threatened or contemplated.

                  (w)  The consolidated financial statements, including the
            notes thereto, included in the Final Memorandum (including those
            included in Appendix I to the Final Memorandum) present fairly the
            financial position of the Company and its consolidated Subsidiaries
            as of the dates shown and their results of operations and cash flows
            for the periods shown, and such financial statements have been
            prepared in conformity with Canadian generally accepted accounting
            principles applied on a consistent basis. The selected financial
            data set forth under the captions "Summary Consolidated Financial
            and Operating Data" and "Selected Consolidated Financial and
            Operating Data" in the Final Memorandum fairly present, on the basis
            stated in the Final Memorandum, the


                                       7




            information included therein. The statistical and market-related
            data included in the Final Memorandum are based on or derived from
            sources that the Company believes to be reliable and accurate.

                  (x)  Note 18 to the consolidated financial statements of the
            Company contained in the Final Memorandum fairly represents the
            manner in which the financial position of the Company as of December
            31, 2001 and 2000 and the results of operations for the years ended
            December 31, 2001, 2000 and 1999 would have been affected by the
            application of generally accepted accounting principles in the
            United States. Note 18 to the consolidated financial statements of
            the Company contained in Appendix I to the Final Memorandum fairly
            represents the manner in which the financial position of the Company
            as of December 31, 2002 and 2001 and the results of operations for
            the years ended December 31, 2002, 2001 and 2000 would have been
            affected by the application of generally accepted accounting
            principles in the United States.

                  (y)  Except as disclosed in the Final Memorandum, since the
            date of the latest audited financial statements included in the
            Final Memorandum (including those included in Appendix I to the
            Final Memorandum), there has been no material adverse change, nor
            any development or event involving a prospective material adverse
            change, in the condition (financial or other), business, properties,
            results of operations or prospects of the Company and its Material
            Subsidiaries taken as a whole, and, except as disclosed in, or
            contemplated by, the Final Memorandum, there has been no dividend or
            distribution of any kind declared, paid or made by the Company on
            any class of its capital stock.

                  (z)  The Company is not an open-end investment company, unit
            investment trust or face-amount certificate company that is or is
            required to be registered under Section 8 of the Investment Company
            Act; and the Company is not and, after giving effect to the offering
            and sale of the Securities and the application of the proceeds
            thereof as described in the Final Memorandum, will not be an
            "investment company" as defined in the Investment Company Act,
            without taking account of any exemption arising out of the number of
            holders of the Company's securities.

                  (aa) No securities of the same class (within the meaning of
            Rule 144A(d)(3) under the Act) as the Securities are listed on any
            national securities exchange registered under Section 6 of the
            Exchange Act or quoted in a U.S. automated inter-dealer quotation
            system.

                  (bb) The offer and sale of the Securities in the manner
            contemplated by this Agreement will be exempt from the registration
            requirements of the Act by reason of Section 4(2) thereof and
            Regulation S thereunder; and it is not necessary to qualify an
            indenture in respect of the Securities under the Trust Indenture
            Act.

                  (cc) Neither the Company, nor any of its Affiliates, nor any
            person acting on its or their behalf (i) has, within the six-month
            period prior to the date hereof, offered or sold in the United
            States or to any U.S. person (as such terms are defined in
            Regulation S) the Securities or any security of the same class or
            series as the Securities or


                                       8




            (ii) has offered or will offer or sell the Securities (A) in the
            United States by means of any form of general solicitation or
            general advertising within the meaning of Rule 502(c) of Regulation
            D or (B) with respect to any such securities sold in reliance on
            Rule 903 of Regulation S, by means of any "directed selling efforts"
            within the meaning of Rule 902(c) of Regulation S. The Company, its
            Affiliates and any person acting on its or their behalf have
            complied and will comply with the offering restrictions requirement
            of Regulation S. The Company has not entered and will not enter into
            any contractual arrangement with respect to the distribution of the
            Securities except for this Agreement.

                  (dd) Neither the Company, nor any person acting on its behalf,
            has, directly or indirectly, (i) made offers or sales of any
            security, or solicited offers to buy any security, under
            circumstances that would require the distribution of the Securities
            in any Canadian province to be qualified by a prospectus filed in
            accordance with the securities laws, and the regulations thereunder,
            of, and the applicable published rules, policy statements, blanket
            orders and notices of the securities regulatory authorities in, such
            province (the "Canadian Securities Laws") or (ii) has engaged in any
            advertisement of the Securities in any printed media of general and
            regular paid circulation, radio or television or any other form of
            advertising in connection with the offer and sale of the Securities
            in such province.

                  (ee) The accountants, KPMG LLP, that have certified the
            financial statements and supporting schedules included in the Final
            Memorandum, are independent public accountants with respect to the
            Company and its Subsidiaries, as required by the Act and the
            Exchange Act, and are independent with respect to the Company and
            its Subsidiaries within the meaning of the Code of Ethics of the
            Canadian Institute of Chartered Accountants. To the best knowledge
            of the Company, other than the consolidated financial statements of
            the Company as of and for the year ended December 31, 1999 with
            respect to the requirements of Rule 3-10 of Regulation S-X under the
            Exchange Act, the historical financial statements and pro forma
            financial information, together with related schedules and notes,
            set forth in the Final Memorandum comply as to form in all material
            respects with the requirements applicable to registration statements
            on Form F-4 under the Act.

                  (ff) No "nationally recognized statistical rating
            organization" as such term is defined for purposes of Rule 436(g)(2)
            under the Act (i) has imposed (or has informed the Company that it
            is considering imposing) any condition (financial or otherwise) on
            the Company's retaining any rating assigned to the Company or any
            securities of the Company or (ii) has indicated to the Company that
            it is considering (a) the downgrading suspension, or withdrawal of,
            or any review for a possible change that does not indicate the
            direction of the possible change in, any rating so assigned or (b)
            any negative change in the outlook for any rating of the Company or
            any securities of the Company.

                  (gg) Upon application of the net proceeds of the Offering as
            set forth under the heading "Use of Proceeds" in the Final
            Memorandum, either (i) the credit facility pursuant to the Amended
            and Restated Credit Agreement dated April 1, 2000, as amended on
            March 31, 2001 and June 20, 2001, between the Company, Royal Bank of



                                       9




            Canada, as administrative agent, Credit Suisse First Boston
            Corporation, as documentation agent, and the lenders thereto (the
            "Existing Credit Facility"), shall be fully repaid and all
            borrowings and obligations of the Company and its Subsidiaries
            thereunder shall be satisfied in full and discharged, or (i)(A) the
            Company will have irrevocably deposited with the administrative
            agent under the Existing Credit Facility thereunder funds in an
            amount sufficient to repay all borrowings and obligations under the
            Existing Credit Facility, (B) the lenders under such Existing Credit
            Facility shall have no claims with respect to outstanding borrowings
            against the Company other than with respect to the deposited funds,
            (C) all covenants thereunder shall cease to be in effect, (D) the
            lending commitments thereunder shall be terminated, and (E) within
            five Business Days of the Closing Date, the Existing Credit Facility
            shall be fully repaid and all borrowings and obligations of the
            Company and its Subsidiaries thereunder shall be satisfied in full
            and discharged.

                  (hh) The credit facility to be entered into by and among Bank
            of America, N.A., Banc of America Securities LLC, Credit Suisse
            First Boston Corporation as lead arrangers, Bank of America, N.A.,
            as administrative agent, the lenders thereunder, and the Company
            (the "New Credit Facility") has been duly authorized by the Company
            and when duly executed and delivered by the Company, the terms of
            the indebtedness thereunder will conform to the description thereof
            contained in the Final Memorandum and the New Credit Facility will
            constitute a valid and legally binding obligation of the Company,
            enforceable against the Company in accordance with its terms,
            subject to bankruptcy, insolvency, fraudulent transfer,
            reorganization, moratorium and similar laws of general applicability
            relating to or affecting creditors' rights and to general equity
            principles.

                  (ii) Each of the relationships and transactions specified in
            Item 7.B of Form 20-F that would have been required to be described
            in a prospectus if the Securities had been registered under the Act
            has been so described in the Final Memorandum (exclusive of any
            amendment or supplement thereto).

                  (jj) There are no stamp or other issuance or transfer taxes or
            duties or other similar fees or charges required to be paid in
            connection with the execution, delivery and performance of this
            Agreement or the Indenture by the Company or the Subsidiary
            Guarantors or the issuance or sale by the Company of the Securities
            or the Exchange Securities.

                  (kk) No Subsidiary of the Company, other than Le Courrier du
            Sud (1998) Inc., is currently prohibited, directly or indirectly,
            from paying any dividends to the Company, from making any other
            distribution on such Subsidiary's Capital Stock, from repaying to
            the Company any loans or advances to such Subsidiary from the
            Company or from transferring any of such Subsidiary's property or
            assets to the Company or any other Subsidiary of the Company.

                  (ll) None of the Company, the Subsidiary Guarantors or any of
            its or their Affiliates, nor any person acting on its or their
            behalf has, directly or indirectly, taken any action designed to
            cause or which has constituted or which could reasonably be


                                       10




            expected to cause or result, under the Exchange Act or otherwise, in
            the stabilization or manipulation of the price of any security of
            the Company to facilitate the sale or resale of the Securities.

                  (mm) Each of the Company and the Subsidiary Guarantors is not
            and, after giving effect to the transactions contemplated by this
            Agreement, including the issuance of the Securities and the
            application of the proceeds thereof as set forth in the Final
            Memorandum, will not be insolvent, as such term is defined by, and
            in accordance with the applicable test therefor pursuant to, the
            laws under which the Company or such Subsidiary Guarantor, as
            applicable, exists.

                  Any certificate signed by any officer of the Company and
delivered to the Initial Purchasers or counsel for the Initial Purchasers in
connection with the offering of the Securities shall be deemed a representation
and warranty by the Company, as to matters covered thereby, to each Initial
Purchaser.

                  2.   PURCHASE AND SALE. Subject to the terms and conditions
and in reliance upon the representations and warranties herein set forth, the
Company and the Subsidiary Guarantors agree to sell to each Initial Purchaser,
and each Initial Purchaser agrees, severally and not jointly, to purchase from
the Company and the Subsidiary Guarantors, at a purchase price of 96.286% of the
principal amount thereof, plus accrued interest, if any, from February 7, 2003
to the Closing Date, the principal amount of Securities set forth opposite such
Initial Purchaser's name in Schedule I hereto.

                  3.   DELIVERY AND PAYMENT. Delivery of and payment for the
Securities shall be made at the offices of Weil, Gotshal & Manges LLP, 767 Fifth
Avenue, New York, New York, or such other place as the Company and Salomon Smith
Barney shall agree, at 10:00 A.M., New York City time, on February 7, 2003, or
at such time on such date (not later than February 14, 2003) as Salomon Smith
Barney shall designate, which date and time may be postponed by agreement
between Salomon Smith Barney and the Company or as provided in Section 9 hereof
(such date and time of delivery and payment for the Securities being herein
called the "Closing Date"). Delivery of the Securities shall be made to Salomon
Smith Barney for the respective accounts of the several Initial Purchasers
against payment by the several Initial Purchasers through Salomon Smith Barney
of the purchase price thereof to or upon the order of the Company by wire
transfer payable in same-day funds to the account specified by the Company. The
Securities shall be delivered in such names, forms and amounts as Salomon Smith
Barney shall specify and delivery shall be made through the facilities of The
Depository Trust Company unless Salomon Smith Barney shall otherwise instruct.

                  4.   REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE INITIAL
PURCHASERS. Each Initial Purchaser, severally and not jointly, represents and
warrants to and agrees with the Company and the Subsidiary Guarantors that:

                       (a)   It has not offered or sold, and will not offer or
               sell, any Securities except to those it reasonably believes to be
               qualified institutional buyers (as defined in Rule 144A under the
               Act) and that, in connection with each such sale, it has taken or
               will take reasonable steps to ensure that the purchaser of such
               Securities is aware that such


                                       11




               sale is being made in reliance on Rule 144A under the Act; or in
               accordance with the restrictions set forth in Exhibit A hereto.

                       (b)   Neither it, its Affiliates nor any person acting
               on its or their behalf has made or will make offers or sales of
               the Securities in the United States by means of any form of
               general solicitation or general advertising (within the meaning
               of Regulation D).

                       (c)   It is an "accredited investor" within the meaning
               of Regulation D under the Act.

                  5.   AGREEMENTS. The Company and the Subsidiary Guarantors
agree with each Initial Purchaser that:

                       (a)   The Company will furnish to each Initial Purchaser
               and to counsel for the Initial Purchasers, without charge, during
               the period referred to in paragraph (c) below, as many copies of
               the Final Memorandum and any amendments and supplements thereto
               as they may reasonably request.

                       (b)   The Company will not amend or supplement the Final
               Memorandum, without the prior written consent of the Initial
               Purchasers.

                       (c)   If at any time prior to the completion of the
               sale of the Securities by the Initial Purchasers (as determined
               by Salomon Smith Barney), any event occurs as a result of which
               the Final Memorandum, as then amended or supplemented, would
               include any untrue statement of a material fact or omit to state
               any material fact necessary to make the statements therein, in
               the light of the circumstances under which they were made, not
               misleading, or if it should be necessary to amend or supplement
               the Final Memorandum to comply with applicable law, the Company
               promptly (i) will notify Salomon Smith Barney of any such event;
               (ii) subject to the requirements of paragraph (b) of this Section
               5, will prepare an amendment or supplement that will correct such
               statement or omission or effect such compliance; and (iii) will
               supply any supplemented or amended Final Memorandum to the
               several Initial Purchasers and counsel for the Initial Purchasers
               without charge in such quantities as they may reasonably request.

                       (d)   The Company will arrange, if necessary, for the
               qualification of the Securities for sale by the Initial
               Purchasers under the laws of such jurisdictions in the United
               States or Canada as the Initial Purchasers may designate and will
               maintain such qualifications in effect so long as required for
               the sale of the Securities; PROVIDED that in no event shall the
               Company be obligated to qualify to do business in any
               jurisdiction where it is not now so qualified, to qualify a
               prospectus under the federal laws of Canada or any political
               subdivision thereof, or to take any action that would subject it
               to service of process in suits, other than those arising out of
               the offering or sale of the Securities, or to taxation in any
               jurisdiction where it is not now so subject. The Company will
               promptly advise Salomon Smith Barney of the receipt by the
               Company of any notification with respect to the suspension of the
               qualification of the Securities for sale in any jurisdiction or
               the initiation or threatening of any proceeding for such purpose.


                                       12





                       (e)   None of the Company, the Subsidiary Guarantors or
               any of its or their Affiliates, nor any person acting on its or
               their behalf will, prior to completion of the Registered Exchange
               Offer, resell any Securities that have been acquired by any of
               them.

                       (f)   None of the Company, the Subsidiary Guarantors or
               any of its or their Affiliates, nor any person acting on its or
               their behalf will, directly or indirectly, make offers or sales
               of any security, or solicit offers to buy any security, under
               circumstances that would cause the exemption afforded by Section
               4(2) of the Act or the safe harbor of Regulation S under the Act
               to cease to be applicable to the offer and sale of the Securities
               contemplated under this Agreement.

                       (g)   On or prior to the Closing Date, none of the
               Company, the Subsidiary Guarantors or any of its or their
               Affiliates, nor any person acting on its or their behalf will
               engage in any form of general solicitation or general advertising
               (within the meaning of Regulation D) in connection with any offer
               or sale of the Securities in the United States.

                       (h)   So long as any of the Securities are "restricted
               securities" within the meaning of Rule 144(a)(3) under the Act,
               the Company will, during any period in which it is not subject to
               Section 13 or 15(d) of the Exchange Act and it is not exempt from
               such reporting requirements pursuant to and in compliance with
               Rule 12g3-2(b) under the Exchange Act, provide to each holder of
               such restricted securities and to each prospective purchaser (as
               designated by such holder of the Securities) of such restricted
               securities, upon the request of such holder or prospective
               purchaser, any information required to be provided by Rule
               144A(d)(4) under the Act in order to permit compliance with Rule
               144A under the Act in connection with resales by such holder of
               such restricted securities. Such information will not, at the
               date thereof, contain any untrue statement of a material fact or
               omit to state any material fact necessary to make the statements
               therein, in the light of the circumstances under which they were
               made, not misleading. This covenant is intended to be for the
               benefit of the holders of the Securities, and the prospective
               purchasers designated by such holders, from time to time of such
               restricted securities.

                       (i)   None of the Company, the Subsidiary Guarantors or
               any of its or their Affiliates, nor any person acting on its or
               their behalf will engage in any directed selling efforts with
               respect to the Securities, and each of them will comply with the
               offering restrictions requirement of Regulation S with respect to
               the Securities. Terms used in this paragraph have the meanings
               given to them by Regulation S.

                       (j)   The Company will cooperate with the Initial
               Purchasers and use its best efforts to permit the Securities and
               the Exchange Securities to be eligible for clearance and
               settlement through The Depository Trust Company.

                       (k)   None of the Company, the Subsidiary Guarantors or
               any of its or their Affiliates will, for a period of 60 days
               following the Execution Time, without the prior written consent
               of Salomon Smith Barney, offer, sell or contract to sell, or
               otherwise dispose of (or enter into any transaction that is
               designed to, or might


                                       13





               reasonably be expected to, result in the disposition (whether by
               actual disposition or effective economic disposition due to cash
               settlement or otherwise) by the Company or any Affiliate of the
               Company or any person in privity with the Company or any
               Affiliate of the Company), directly or indirectly, or announce
               the offering of, any debt securities issued or guaranteed by the
               Company (other than the Securities).

                       (l)   None of the Company, the Subsidiary Guarantors or
               any of its or their Affiliates will take, directly or indirectly,
               any action designed to or which has constituted or which could
               reasonably be expected to cause or result, under the Exchange Act
               or otherwise, in stabilization or manipulation of the price of
               any security of the Company to facilitate the sale or resale of
               the Securities.

                       (m)   The Company will apply the net proceeds from the
               sale of the Notes as set forth under the heading "Use of
               Proceeds" in the Final Memorandum.

                       (n)   The Company agrees to pay the costs and expenses
               relating to the following matters: (i) the preparation of the
               Indenture and the Registration Rights Agreement, the issuance of
               the Securities and the Exchange Securities and the fees of the
               Trustee; (ii) the preparation, printing or reproduction of the
               Preliminary Memorandum and Final Memorandum and each amendment or
               supplement to either of them; (iii) the printing (or
               reproduction) and delivery (including postage, air freight
               charges and charges for counting and packaging) of such copies of
               the Preliminary Memorandum and Final Memorandum, and all
               amendments or supplements to either of them, as may, in each
               case, be reasonably requested for use in connection with the
               offering and sale of the Securities; (iv) the preparation,
               printing, authentication, issuance and delivery of certificates
               for the Securities, including any stamp or transfer taxes in
               connection with the original issuance and sale of the Securities;
               (v) the printing (or reproduction) and delivery of this
               Agreement, any blue sky memorandum and all other agreements or
               documents printed (or reproduced) and delivered in connection
               with the offering of the Securities and the Exchange Securities;
               (vi) any registration or qualification of the Securities for
               offer and sale under applicable securities laws, including blue
               sky laws, in accordance with Section 5(d) hereof (including
               filing fees and the reasonable fees and expenses of counsel for
               the Initial Purchasers relating to such registration and
               qualification); (vii) Canadian trade report filing fees, (viii)
               admitting the Notes and Exchange Notes for trading in the Portal
               Market; (ix) the transportation and other expenses incurred by or
               on behalf of Company representatives in connection with
               presentations to prospective purchasers of the Securities; (x)
               the fees and expenses of the Company's accountants and the fees
               and expenses of counsel (including local and special counsel) for
               the Company; and (xi) all other costs and expenses incident to
               the performance by the Company of its obligations hereunder;
               PROVIDED that the Company will not be obligated to pay the
               expenses of the Initial Purchasers except as provided in Section
               7 hereof.

                  6.   CONDITIONS TO THE OBLIGATIONS OF THE INITIAL PURCHASERS.
The obligations of the Initial Purchasers to purchase the Securities shall be
subject to the accuracy of the representations and warranties on the part of the
Company and the Subsidiary Guarantors contained herein at the Execution Time and
the Closing Date pursuant to Section 3 hereof, to the accuracy of the statements
of the Company and the Subsidiary Guarantors made in any


                                       14





certificates pursuant to the provisions hereof, to the performance by the
Company and the Subsidiary Guarantors of its or their obligations hereunder and
to the following additional conditions:

                       (a)   The Company shall have requested and caused Arnold
               & Porter, U.S. counsel for the Company and the Subsidiary
               Guarantors, to furnish to the Initial Purchasers its opinion,
               dated the Closing Date and addressed to the Initial Purchasers,
               to the effect that

                             (i)   Each of Toronto Sun International, Inc.,
                    Florida Sun Publications, Inc. and TS Printing Inc. (the
                    "Delaware Guarantors") has been duly incorporated and is an
                    existing corporation, in good standing under the laws of the
                    State of Delaware, with corporate power and authority to own
                    its properties and conduct its business as described in the
                    Final Memorandum; and each Delaware Guarantor (other than
                    Toronto Sun International, Inc.) is duly qualified to do
                    business as a foreign corporation, in good standing in
                    Florida; all of the issued shares of the capital stock of
                    each of the Delaware Guarantors have been duly authorized
                    and, assuming full payment of the consideration thereof
                    where the minutes of Board meetings for such issuances do
                    not indicate that payment has been received and assuming in
                    all other cases the accuracy and completeness of all minutes
                    of Board meetings, validly issued and are fully paid and
                    nonassessable and are owned directly or indirectly by the
                    Company;

                             (ii)  The Indenture, the Registration Rights
                    Agreement and the Guarantees to be issued by the Delaware
                    Guarantors have been duly authorized, executed and delivered
                    by each of the Delaware Guarantors; and conform to the
                    description thereof contained in the Final Memorandum;

                             (iii) Assuming the due authorization, execution and
                    delivery of the Indenture, the Registration Rights Agreement
                    and the Securities by each of the Company and the Subsidiary
                    Guarantors other than the Delaware Guarantors (the "Canadian
                    Guarantors"), the Indenture, the Registration Rights
                    Agreement and the Securities constitute valid and legally
                    binding obligations of the Company and the Subsidiary
                    Guarantors enforceable in accordance with their terms
                    (subject, as to enforcement, to bankruptcy, insolvency,
                    reorganization, moratorium, fraudulent conveyance,
                    preference or other laws affecting or relating to the
                    enforcement of creditors' rights generally from time to time
                    in effect and to equitable principles, regardless of whether
                    enforcement is sought in equity or at law) and conform to
                    the description thereof contained in the Final Memorandum;
                    when the Company and the Subsidiary Guarantors have duly
                    executed each global certificate representing the Exchange
                    Securities and such Exchange Securities have been
                    authenticated, in accordance with the provisions of the
                    Indenture and delivered to the holders of Notes in exchange
                    therefor as contemplated by the Registration Rights
                    Agreements, and assuming that the Canadian Guarantors have
                    duly and validly authorized the Exchange Guarantees, such
                    Exchange Securities will constitute legal, valid, binding
                    and enforceable obligations of the Company and the
                    Subsidiary Guarantors entitled to the benefits of the
                    Indenture (subject, as to


                                       15




                    enforcement, to bankruptcy, insolvency, reorganization,
                    moratorium, fraudulent conveyance, preference or other laws
                    affecting or relating to the enforcement of creditors'
                    rights generally from time to time in effect and to
                    equitable principles, regardless of whether enforcement is
                    sought in equity or at law);

                             (iv)   The Guarantees to be issued by the Delaware
                    Guarantors have been duly authorized, authenticated, issued
                    and delivered; the form of global certificate representing
                    the Guarantees has been duly approved and adopted by each of
                    the Delaware Guarantors and complies with applicable laws;
                    the issuance of the Exchange Guarantees to be issued by the
                    Delaware Guarantors has been duly and validly authorized by
                    the Delaware Guarantors;

                             (v)    Assuming due authorization by each of the
                    Company and the Canadian Guarantors, this Agreement has been
                    duly executed and delivered by the Company and the
                    Subsidiary Guarantors, to the extent that execution and
                    delivery are governed by the law of the State of New York;

                             (vi)   The Company is not and, after giving effect
                    to the offering and sale of the Securities and the
                    application of the proceeds thereof as described in the
                    Final Memorandum, will not be an "investment company" as
                    defined in the Investment Company Act;

                             (vii)  No consent, approval, authorization or order
                    of, or filing, registration or qualification with, any
                    Governmental Authority, which has not been obtained, taken
                    or made (other than as required by any state securities or
                    Blue Sky laws of the various states, as to which such
                    counsel need express no opinion) is required under any
                    Applicable Law for the issuance, authentication or sale of
                    the Securities or the performance by the Company and the
                    Subsidiary Guarantors of its or their obligations under this
                    Agreement, the Registration Rights Agreement and the
                    Indenture, except as may be required in connection with the
                    registration of the Securities under the Registration Rights
                    Agreement. For purposes of this opinion, the term
                    "Governmental Authority" means any executive, legislative,
                    judicial, administrative or regulatory body of the State of
                    New York or the United States. For purposes of this opinion,
                    the term "Applicable Law" means those laws, rules and
                    regulations of the United States of America and the State of
                    New York, in each case which are normally applicable to the
                    transactions of the type contemplated by this Agreement;

                             (viii) The execution, delivery and performance of
                    the Indenture, this Agreement and the Registration Rights
                    Agreement will not result in a breach or violation of any of
                    the terms and provisions of, or constitute a default under,
                    any federal statute of Applicable Law;

                             (ix)   It is not necessary in connection with (i)
                    the offer, sale and delivery of the Securities by the
                    Company and the Subsidiary Guarantors to the several Initial
                    Purchasers pursuant to this Agreement or (ii) the resales of
                    the Securities by the several Initial Purchasers in the
                    manner contemplated by this


                                       16




                    Agreement, to register the Securities under the Act or to
                    qualify the Indenture under the Trust Indenture Act;

                             (x)    The statements in the Final Memorandum under
                    the caption "Tax Considerations - U.S. Federal Income Tax
                    Considerations," to the extent they constitute matters of
                    U.S. law or legal conclusions with respect thereto, have
                    been prepared or reviewed by such counsel and are correct in
                    all material respects and fairly summarize the matters set
                    forth therein;

                             (xi)   The statements in the Final Memorandum under
                    the captions "Description of the Notes" and "Plan of
                    Distribution" in the Final Memorandum, insofar as such
                    statements constitute a summary of the documents referred to
                    therein, fairly summarize in all material respects such
                    documents;

                             (xii)  Assuming the due authorization, execution
                    and delivery of this Agreement, the Indenture and the
                    Registration Rights Agreement by each party thereto (other
                    than the Delaware Guarantors), each of the Company and the
                    Subsidiary Guarantors have validly and irrevocably submitted
                    to the jurisdiction of any United States federal or state
                    court located in the State of New York, County of New York,
                    have expressly accepted the non-exclusive jurisdiction of
                    any such court and have validly and irrevocably appointed CT
                    Corporation System as their authorized agent in any suit or
                    proceeding against them instituted by the Initial Purchasers
                    based on or arising under the Indenture, this Agreement or
                    the Registration Rights Agreement; and

                             (xiii) Such counsel has no reason to believe that
                    the Final Memorandum, or any amendment or supplement
                    thereto, as of the date hereof and as of the Closing Date,
                    contained any untrue statement of a material fact or omitted
                    to state any material fact required to be stated therein or
                    necessary to make the statements therein not misleading; it
                    being understood that such counsel need express no opinion
                    as to the financial statements or other financial data
                    contained in the Final Memorandum.

                    In rendering such opinion, such counsel may rely, as to
matters of fact, to the extent they deem proper, on certificates of responsible
officers of the Company, the Subsidiary Guarantors and public officials.
References to the Final Memorandum in this paragraph (a) include any amendment
or supplement thereto at the Closing Date.

                       (b)   The Company shall have requested and caused Ogilvy
          Renault, Canadian counsel for the Company and the Subsidiary
          Guarantors, to furnish to the Initial Purchasers its opinion
          (containing customary assumptions, qualifications, limitations and
          exceptions acceptable to the Initial Purchasers), dated the Closing
          Date and addressed to the Initial Purchasers, and covering, in
          substance, the following matters:

                             (i)    The Company has been duly incorporated and
                    is an existing company in good standing under the laws of
                    British Columbia, with the corporate power and authority to
                    own or lease, as the case may be, and operate its properties



                                       17




                    and conduct its business as described in the Final
                    Memorandum; the Company has the corporate power and
                    authority to execute, deliver and perform its obligations
                    under this Agreement, the Indenture, the Securities, the
                    Exchange Securities and the Registration Rights Agreement;
                    and the Company is duly qualified or registered to carry on
                    business as a foreign or extra-provincial corporation in
                    good standing in all other jurisdictions in which its
                    ownership or lease of property or the conduct of its
                    business requires such qualification except to the extent
                    that such failure to be so qualified or in good standing
                    would not have a Material Adverse Effect; all of the issued
                    shares of the capital stock of the Company have been duly
                    authorized and, assuming full payment of the consideration
                    thereof where the minutes of Board meetings for such
                    issuances do not indicate that payment has been received and
                    assuming in all other cases the accuracy and completeness of
                    all minutes of Board meetings, validly issued and are fully
                    paid and nonassessable; all of the issued shares of the
                    capital stock of the Company are owned indirectly by
                    Quebecor Media Inc.;

                             (ii)   Each of the Canadian Guarantors has been
                    duly incorporated or formed and is an existing corporation,
                    partnership or limited partnership, as applicable, in good
                    standing under the laws of the jurisdiction of its
                    incorporation or formation, as the case may be, with the
                    corporate power and authority to own its properties and
                    conduct its business as described in the Final Memorandum;
                    each Canadian Guarantor has the corporate power and
                    authority to execute, deliver and perform its obligations
                    under this Agreement, the Indenture, the Securities, the
                    Exchange Securities and the Registration Rights Agreement;
                    and each Canadian Guarantor is duly qualified to do business
                    as a foreign corporation, partnership, or limited
                    partnership, as applicable, in good standing in all other
                    jurisdictions in which its ownership or lease of property or
                    the conduct of its business requires such qualification
                    except to the extent that such failure to be so qualified or
                    in good standing would not have a Material Adverse Effect;
                    all of the issued shares of the capital stock of each of the
                    Canadian Guarantors have been duly authorized and, assuming
                    full payment of the consideration thereof where the minutes
                    of Board meetings for such issuances do not indicate that
                    payment has been received and assuming in all other cases
                    the accuracy and completeness of all minutes of Board
                    meetings, validly issued and are fully paid and
                    nonassessable and are owned directly or indirectly by the
                    Company;

                             (iii)  The Indenture, the Registration Rights
                    Agreement, the Notes and the Guarantees to be issued by the
                    Canadian Guarantors have been duly authorized, executed and
                    delivered by each of the Company and the Canadian
                    Guarantors; and conform to the description thereof contained
                    in the Final Memorandum;

                             (iv)   No consent, approval, authorization,
                    registration, exemption, recording, qualification, or order
                    of, or filing with, any governmental agency or body or any
                    court in Canada is required under the laws of the Province
                    of British Columbia, Ontario or Quebec or the federal laws
                    of Canada for the consummation of the transactions
                    contemplated by this Agreement and the



                                       18




                    Registration Rights Agreement in connection with the
                    issuance or sale of the Securities by each of the Company
                    and the Canadian Guarantors, or to preserve or protect the
                    validity or enforceability of the Indenture or the
                    Securities, except for filings, registrations and recordings
                    which have been made and the filing of certain notices of
                    private placement and the payment of filing fees required by
                    the securities legislation of certain provinces in Canada to
                    the extent Securities are sold by private placement therein;

                             (v)    No filing, license, consent, permission,
                    approval, authorization, or order of any court or
                    governmental agency or body in Canada is required to be
                    obtained by the Company or any of its Subsidiaries in order
                    for the Company or any of its Subsidiaries to carry on their
                    current or contemplated business and operations as described
                    in the Final Memorandum, except to the extent that the
                    failure does not have a Material Adverse Effect;

                             (vi)   Neither the execution, delivery and
                    performance by any of the Company or the Canadian Guarantors
                    of their respective obligations under the Indenture, this
                    Agreement and the Registration Rights Agreement, nor the
                    issue and sale of the Securities or the Exchange Securities,
                    will conflict with or result in a breach or violation of any
                    of the terms and provisions of, or constitute a default
                    under, (A) any federal statute of Canada or any statute of
                    the Province of British Columbia, Ontario or Quebec, or any
                    rule, regulation or order thereunder, or (B) any indenture,
                    note, loan agreement, mortgage, deed of trust, security
                    agreement or other written agreement or instrument creating,
                    evidencing or securing indebtedness of the Company or any
                    Canadian Guarantor, listed on Exhibit C to this Agreement
                    and identified to us by an officer of the Company as
                    material to the Company or any Canadian Guarantor (the
                    "Material Agreements") except to the extent that such
                    breach, violation or default would not have a Material
                    Adverse Effect, or (C) the constituting documents or
                    by-laws, of any of the Company or the Canadian Guarantors.
                    Each of the Company and the Canadian Guarantors has full
                    power and authority to authorize, issue and sell the
                    Securities and the Exchange Securities as contemplated by
                    this Agreement;

                             (vii)  This Agreement has been duly authorized,
                    executed and delivered by each of the Company and the
                    Canadian Guarantors;

                             (viii) The Notes and the Guarantees to be issued by
                    the Canadian Guarantors have been duly authorized,
                    authenticated, issued and delivered by the Company and the
                    Canadian Guarantors, respectively; the form of global
                    certificates representing the Securities has been duly
                    approved and adopted by each of the Company and the Canadian
                    Guarantors and complies with applicable laws; the issuance
                    of the Exchange Notes and Exchange Guarantees to be issued
                    by the Canadian Guarantors has been duly and validly
                    authorized by the Company and the Canadian Guarantors,
                    respectively;

                             (ix)   The statements in the Final Memorandum under
                    the captions "Canadian Federal Income Tax Considerations" to
                    the extent they



                                       19




                    constitute matters of Canadian law, fairly and accurately
                    describe the principal Canadian federal income tax
                    consequences under the INCOME TAX ACT (Canada) to a
                    purchaser described therein;

                             (x)    Neither the Company nor any of the Canadian
                    Guarantors is in violation of its constituting documents or
                    by-laws and to the best of such counsel's knowledge after
                    due enquiry, neither the Company nor any of the Canadian
                    Guarantors is in default in the performance of any
                    obligation, agreement, covenant or condition contained in
                    any Material Agreement, except to the extent that such
                    default in the performance of any obligation, agreement,
                    covenant or condition in any Material Agreement does not
                    have a Material Adverse Effect;

                             (xi)   The statements in the Final Memorandum under
                    the captions "Business--Regulation," "Description of Certain
                    Indebtedness," "Risk Factors--U.S. investors in the notes
                    may have difficulties enforcing certain civil liabilities,"
                    "Risk Factors--Canadian bankruptcy and insolvency laws may
                    impair the trustee's ability to enforce remedies under the
                    notes," "Risk Factors-Applicable statutes allow courts,
                    under specific circumstances, to void the subsidiary
                    guarantees of the notes,' "Risk Factors--We are subject to
                    extensive environmental regulation," "Management," "Our
                    Shareholder" and "Certain Relationships and Related
                    Transactions" in the Final Memorandum, insofar as such
                    statements constitute a summary of the documents referred to
                    therein, fairly summarize in all material respects such
                    documents;

                             (xii)  A judgment obtained in the State of New York
                    or a state or federal court of the Borough of Manhattan in
                    the City of New York (a "New York Court"), arising out of or
                    in relation to the obligations of the Company or the
                    Canadian Guarantors under this Agreement, the Indenture, the
                    Securities or the Registration Rights Agreement for a sum
                    certain would be recognized by a court of competent
                    jurisdiction in the Province of Quebec (a "Quebec Court")
                    and would be declared enforceable against the Company and
                    the Canadian Guarantors in the Province of Quebec, unless
                    (a) the New York Court where the decision was rendered had
                    no jurisdiction according to the laws of the Province of
                    Quebec (however, submission by the Company and the Canadian
                    Guarantors in this Agreement to the non-exclusive
                    jurisdiction of the New York Court will be sufficient for
                    that purpose), (b) the decision was subject to ordinary
                    remedy or was not final or enforceable at the place where it
                    was rendered, (c) the decision was rendered in contravention
                    of fundamental principles of procedure, (d) a dispute
                    between the same parties, based on the same facts and having
                    the same object has given rise to a decision rendered in the
                    Province of Quebec, whether it has acquired the authority of
                    a final judgment or not, or is pending before a Quebec
                    authority in first instance or has been decided in a third
                    country and the decision meets the necessary conditions for
                    recognition in the Province of Quebec, (e) the outcome of
                    the decision of the New York Court is manifestly
                    inconsistent with public order as understood in
                    international relations, (f) the decision enforces
                    obligations arising from the taxation or other public laws
                    of a



                                       20




                    foreign country unless there is reciprocity, (g) such
                    judgment was obtained contrary to an order made by the
                    Attorney General of Canada under the FOREIGN
                    EXTRATERRITORIAL MEASURES ACT (Canada) or by the Competition
                    Tribunal under the COMPETITION ACT (Canada) in respect of
                    certain judgments, decrees, orders or processes having
                    effect on competition in Canada, or (h) the motion for
                    recognition and declaration for enforcement of such judgment
                    in the Province of Quebec has not been commenced within the
                    applicable limitation period. A decision rendered by default
                    by a New York Court may not be recognized or declared
                    enforceable by a Quebec Court unless the plaintiff proves
                    that the act of procedure initiating the proceedings was
                    duly served on the defaulting party in accordance with the
                    law of the place where the decision was rendered. The
                    authority may nonetheless refuse recognition or enforcement
                    if the defaulting party proves that, owing to the
                    circumstances, he was unable to learn of the act of
                    procedure initiating the proceedings or was not given
                    sufficient time to offer his defense;

                             (xiii) The laws of the Provinces of Ontario,
                    Alberta and British Columbia and the laws of Canada
                    applicable therein permit an action to be brought in a court
                    of competent jurisdiction in such provinces on any final,
                    conclusive and enforceable judgment IN PERSONAM of a New
                    York Court that is subsisting and unsatisfied respecting the
                    enforcement of the Indenture, the Purchase Agreement, the
                    Securities or the Registration Rights Agreement that is not
                    impeachable as void or voidable under New York law for a sum
                    certain if, in an action commenced in any of the Provinces
                    of Ontario, Alberta and British Columbia (a) the court
                    rendering such judgment had jurisdiction over the judgment
                    debtor as recognized by a court of competent jurisdiction in
                    the Provinces of Ontario, Alberta or British Columbia (and
                    submission to the non-exclusive jurisdiction of the New York
                    Court by the Company and the Canadian Guarantors pursuant to
                    the Indenture, the Purchase Agreement and the Registration
                    Rights Agreement will be sufficient for the purpose), (b)
                    such judgment was not obtained by fraud or in a manner
                    contrary to natural justice or in contravention of the
                    fundamental principles of procedure and the decision and
                    enforcement thereof would not be inconsistent with public
                    policy, as such term is understood under the laws of the
                    Provinces of Ontario, Alberta or British Columbia and the
                    laws of Canada applicable therein, as the case may be, (c)
                    the enforcement of such judgment does not constitute,
                    directly or indirectly, the enforcement of foreign revenue,
                    expropriatory or penal laws, (d) the action to enforce such
                    judgment is commenced within the applicable limitation
                    period, (e) such judgment was not obtained in a manner
                    contrary to an order made by the Attorney General of Canada
                    under the FOREIGN EXTRATERRITORIAL MEASURES ACT (Canada) or
                    by the Competition Tribunal under the COMPETITION ACT
                    (Canada) in respect of certain judgments, decrees, orders or
                    processes having effect on competition in Canada, and (f) a
                    dispute between the same parties based on the same subject
                    matter has not given rise to a decision rendered by a court
                    of competent jurisdiction in the Provinces of Ontario,
                    Alberta or British Columbia or been decided by a foreign
                    authority and the decision meets the necessary



                                       21




                    conditions for recognition under the laws of the Provinces
                    of Ontario, Alberta or British Columbia and the laws of
                    Canada applicable therein;

                             (xiv)  A court of competent jurisdiction in the
                    Provinces of Quebec, Ontario, British Columbia or Alberta
                    (the "Relevant Provinces") would uphold the choice of the
                    laws of the State of New York as the proper law governing
                    this Agreement, the Indenture, the Securities and the
                    Registration Rights Agreement, provided that such choice of
                    law is BONA FIDE (in the sense that it was not made with a
                    view to avoiding the consequences of the laws of any other
                    jurisdiction) and provided that the application of such law
                    is not contrary to public policy, as that term is understood
                    under the laws of the Relevant Provinces and the laws of
                    Canada applicable therein. Such counsel is not aware of any
                    reason why a court of competent jurisdiction in the Relevant
                    Provinces would find such choice of law not to be BONA FIDE
                    or to be contrary to public policy, as that term is
                    understood under the laws of the Relevant Provinces and the
                    laws of Canada applicable therein;

                             (xv)   Should enforcement of this Agreement, the
                    Indenture, the Securities and the Registration Rights
                    Agreement against the Company or any Canadian Guarantor be
                    sought in the Province of Quebec in accordance with the laws
                    of the State of New York, a Quebec Court would, subject to
                    paragraph (xiv) above, recognize the choice of laws of the
                    State of New York (other than for matters of procedure or
                    laws in force in the Province of Quebec which are applicable
                    by reason of their particular object, in respect of which
                    the laws of the relevant province will then be applied),
                    and, upon adducing appropriate evidence to establish such
                    law, the laws of the State of New York would be applied by a
                    Quebec Court, provided that a Quebec Court will retain
                    discretion to decline to hear such action if, on application
                    by a party, (a) another action between the same parties,
                    based on the same facts and having the same object, is
                    pending before a foreign authority, provided that the latter
                    action can result in a decision which may be recognized in
                    the relevant province, or if such a decision has already
                    been rendered by a foreign authority, or (b) it considers
                    that the authorities of another jurisdiction are in a better
                    position to decide;

                             (xvi)  In any proceedings undertaken in courts of
                    competent jurisdiction of the Provinces of Ontario, British
                    Columbia or Alberta to enforce and interpret this Agreement,
                    the Indenture, the Securities or the Registration Rights
                    Agreement, such courts will, to the extent pleaded and
                    proved, apply the laws of New York chosen by the parties
                    thereto to govern such agreements provided that, (a) such
                    choice of law is BONA FIDE (in the sense that it was not
                    made with a view to avoiding the consequences of the law of
                    any other jurisdiction), (b) the courts will apply the
                    procedural laws of the Provinces of Ontario, British
                    Columbia or Alberta and the laws of Canada applicable
                    therein, as the case may be, (c) the courts may not enforce
                    an obligation enforceable under New York law where
                    performance of the obligation would be illegal by the laws
                    of the place of performance, or which constitutes the direct
                    or indirect enforcement of foreign revenue, expropriatory or
                    penal laws, (d) a court may



                                       22





                    decline to hear an action if it determines, in its
                    discretion, that it is not the appropriate forum to hear the
                    action or if concurrent proceedings are being brought
                    elsewhere, and (e) the application of the provisions of New
                    York law sought to be applied is not contrary to public
                    policy, as such term is understood under the laws of
                    Provinces of Ontario, British Columbia or Alberta;

                             (xvii)  Such counsel is not aware of any reasons,
                    under the laws of the Relevant Provinces or the federal laws
                    of Canada applicable therein or with respect to the
                    application of the laws of the State of New York by a court
                    of competent jurisdiction in the Relevant Provinces for
                    avoiding enforcement of judgments of a New York Court with
                    respect to this Agreement, the Indenture and the Securities
                    on the basis of public policy or public order, as that term
                    is understood in international relations and under the laws
                    of the Relevant Provinces and the laws of Canada applicable
                    therein;

                             (xviii) Pursuant to the CURRENCY ACT (Canada) and,
                    where applicable, the Civil Code of Quebec, a judgment
                    rendered by a court in any province of Canada may only be
                    awarded in Canadian currency;

                             (xix)   Each of the Company and the Canadian
                    Guarantors has the legal capacity to sue and be sued in its
                    own name under the laws of the Relevant Provinces. Assuming
                    the choice of law of the State of New York provided for in
                    this Agreement is effective and enforceable under the laws
                    of New York, each of the Company and the Canadian Guarantors
                    has the necessary power to submit, and has irrevocably
                    submitted, to the non-exclusive jurisdiction of the New York
                    Court and has validly and irrevocably appointed CT
                    Corporation System as its authorized agent for the purpose
                    described in Section 14 hereof; each of the Company and the
                    Canadian Guarantors has the necessary power to submit, and
                    has irrevocably submitted, to the non-exclusive jurisdiction
                    of the New York Court and has validly and irrevocably
                    appointed CT Corporation System as its authorized agent for
                    the purposes described in the Indenture, the Securities and
                    the Registration Rights Agreement under the laws of the
                    Relevant Provinces; the irrevocable submission of the
                    Company and the Canadian Guarantors to the non-exclusive
                    jurisdiction of the New York Court in the Purchase Agreement
                    will be recognized by the courts of the Relevant Provinces
                    and such counsel knows of no reason why a court of competent
                    jurisdiction in the Relevant Provinces would not give effect
                    to such submission; the irrevocable submission of the
                    Company and the Canadian Guarantors to the non-exclusive
                    jurisdiction of the New York Court in the Indenture, the
                    Securities and the Registration Rights Agreement will be
                    recognized by the courts of the Relevant Provinces and such
                    counsel knows of no reason why such courts would not give
                    effect to such submission;

                             (xx)    To the knowledge of such counsel, there is
                    no pending or threatened action, suit or proceeding by or
                    before any court or governmental agency, authority or body
                    or any arbitrator involving the Company or any of its
                    Subsidiaries or its or their officers, directors or property
                    of a character required to be disclosed in a registration
                    statement on Form F-1 that is not adequately



                                       23




                    disclosed in the Final Memorandum, except in each case for
                    such proceedings that, if the subject of an unfavorable
                    decision, ruling or finding would not singly or in the
                    aggregate, result in a material adverse change in the
                    condition (financial or otherwise), prospects, earnings,
                    business or properties of the Company and its Subsidiaries,
                    taken as a whole; and

                             (xxi)  Such counsel has no reason to believe that
                    the Final Memorandum, or any amendment or supplement
                    thereto, as of the date hereof and as of the Closing Date,
                    contained any untrue statement of a material fact or omitted
                    to state any material fact required to be stated therein or
                    necessary to make the statements therein not misleading; the
                    descriptions in the Final Memorandum of statutes, legal and
                    governmental proceedings and contracts and other documents,
                    insofar as such disclosure describes or summarizes matters
                    of Canadian law or constitutes conclusions of Canadian law,
                    are accurate and fairly summarize in all material respects
                    the matters described therein; it being understood that such
                    counsel need express no opinion as to the financial
                    statements or other financial data contained in the Final
                    Memorandum.

                    In rendering such opinion, such counsel may rely, as to
matters of fact, to the extent they deem proper, on certificates of responsible
officers of the Company, the Subsidiary Guarantors and public officials.
References to the Final Memorandum in this paragraph (b) include any amendment
or supplement thereto at the Closing Date.

                       (c)   The Initial Purchasers shall have received from
          Weil, Gotshal & Manges LLP, U.S. counsel for the Initial Purchasers,
          such opinion or opinions, dated the Closing Date and addressed to the
          Initial Purchasers, with respect to the issuance and sale of the
          Securities, the Indenture, the Registration Rights Agreement, the
          Final Memorandum (as amended or supplemented at the Closing Date) and
          other related matters as the Initial Purchasers may reasonably
          require, and the Company shall have furnished to such counsel such
          documents as they reasonably request for the purpose of enabling them
          to pass upon such matters.

                       (d)   The Initial Purchasers shall have received from
          Davies Ward Phillips & Vineberg LLP, Canadian counsel for the Initial
          Purchasers, such opinion or opinions, dated the Closing Date and
          addressed to the Initial Purchasers, with respect to the issuance and
          sale of the Securities, the Indenture, the Registration Rights
          Agreement, the Final Memorandum (as amended or supplemented at the
          Closing Date) and other related matters as the Initial Purchasers may
          reasonably require, and the Company shall have furnished to such
          counsel such documents as they reasonably request for the purpose of
          enabling them to pass upon such matters.

                       (e)   The Company and each Subsidiary Guarantor shall
          have furnished to the Initial Purchasers a certificate of the Company
          and each Subsidiary Guarantor, signed by the President and Chief
          Executive Officer and the Vice President, Corporate Controller of the
          Company and by the principal executive officer and the principal
          financial or accounting officer of each Subsidiary Guarantor, dated
          the Closing Date, to the effect that the signers of each such
          certificate have carefully examined the Final



                                       24





          Memorandum, any amendment or supplement to the Final Memorandum and
          this Agreement and that the representations and warranties of the
          Company in this Agreement are true and correct on and as of the
          Closing Date with the same effect as if made on the Closing Date, and
          the Company and the Subsidiary Guarantors have complied with all the
          agreements and satisfied all the conditions on its or their part to be
          performed or satisfied hereunder at or prior to the Closing Date.

                       (f)   At the Execution Time and at the Closing Date, the
          Company shall have requested and caused KPMG LLP to furnish to the
          Initial Purchasers letters, dated respectively as of the Execution
          Time and as of the Closing Date, in form and substance satisfactory to
          the Initial Purchasers, confirming that they are independent
          accountants within the meaning of the Act and the Exchange Act and the
          respective applicable rules and regulations adopted by the Commission
          thereunder, that they have performed a review of the unaudited interim
          financial information of the Company for the 9-month period ended
          September 30, 2002 and as at September 30, 2002, in accordance with
          the Statement on Auditing Standards No. 71, and stating in effect
          that:

                             (i)   in their opinion the audited financial
                    statements and financial statement schedules included or
                    incorporated by reference in the Final Memorandum and
                    reported on by them comply as to form in all material
                    respects with the applicable accounting requirements of the
                    Exchange Act and the related rules and regulations adopted
                    by the Commission thereunder;

                             (ii)  on the basis of a reading of the latest
                    unaudited financial statements made available by the Company
                    and its Subsidiaries; their limited review in accordance
                    with the standards established under Statement on Auditing
                    Standards No. 71, of the unaudited interim financial
                    information for the 9-month period ended September 30, 2002,
                    and as at September 30, 2002, as indicated in their report
                    included or incorporated in the Final Memorandum; carrying
                    out certain specified procedures (but not an examination in
                    accordance with generally accepted auditing standards) that
                    would not necessarily reveal matters of significance with
                    respect to the comments set forth in such letter; a reading
                    of the minutes of the meetings of the shareholder and
                    directors of the Company and the Subsidiaries; and inquiries
                    of certain officials of the Company who have responsibility
                    for financial and accounting matters of the Company and its
                    Subsidiaries as to transactions and events subsequent to
                    December 31, 2001, nothing came to their attention that
                    caused them to believe that:

                                   (1)  any unaudited financial statements
                              included or incorporated by reference in the Final
                              Memorandum do not comply as to form in all
                              material respects with applicable accounting
                              requirements and with the related rules and
                              regulations of the Commission with respect to
                              financial statements included or incorporated by
                              reference in current reports on Form 6-K under the
                              Exchange Act; and said unaudited financial
                              statements are not in conformity with Canadian
                              generally accepted accounting principles applied
                              on a basis substantially consistent with that




                                       25





                              of the audited financial statements included or
                              incorporated by reference in the Final Memorandum;
                              or

                                   (2)  with respect to the period subsequent to
                              December 31, 2002, there were any changes, at a
                              specified date not more than five days prior to
                              the date of the letter, in the capital stock or
                              long-term debt of the Company and its Subsidiaries
                              or decreases in the shareholder's equity of the
                              Company or in net assets or working capital of the
                              Company and its consolidated Subsidiaries as
                              compared with the amounts shown on the September
                              30, 2002 consolidated balance sheet included or
                              incorporated by reference in the Final Memorandum,
                              or for the period from January 1, 2003 to such
                              specified date there were any decreases, as
                              compared with the corresponding period in the
                              preceding year in net sales, operating income or
                              net earnings of the Company and its Subsidiaries,
                              except in all instances for changes or decreases
                              set forth in such letter, in which case the letter
                              shall be accompanied by an explanation by the
                              Company as to the significance thereof unless said
                              explanation is not deemed necessary by the Initial
                              Purchasers; or

                                   (3)  the financial information included in
                              the Final Memorandum under the headings "Summary
                              Consolidated Financial and Operating Data,"
                              "Selected Consolidated Financial and Operating
                              Data," "Management-Compensation of Directors and
                              Executive Officers" and the information provided
                              in accordance with Item 503(d) of Regulation S-K
                              (Ratio of Earnings to Fixed Charges) is not in
                              conformity with the applicable disclosure
                              requirements of Regulation S-K or Form 20-F, as
                              the case may be; or

                                (iii)  they have performed certain other
                    specified procedures as a result of which they determined
                    that certain information of an accounting, financial or
                    statistical nature (which is limited to accounting,
                    financial or statistical information derived from the
                    general accounting records of the Company and its
                    Subsidiaries) set forth in the Final Memorandum, including
                    the information set forth under the captions "Summary
                    Consolidated Financial and Operating Data," "Selected
                    Consolidated Financial and Operating Data," "Management's
                    Discussion and Analysis of Financial Condition and Results
                    of Operations," "Business" and "Management," agrees with the
                    accounting records of the Company and its Subsidiaries,
                    excluding any questions of legal interpretation.

                    References to the Final Memorandum in this Section 6(f)
         include any amendment or supplement thereto at the date of the
         applicable letter.

                       (g)   Subsequent to the Execution Time or, if earlier,
          the dates as of which information is given in the Final Memorandum
          (exclusive of any amendment or supplement thereto), there shall not
          have been (i) any change or decrease specified in the letter or
          letters referred to in paragraph (f)(ii)(2) of this Section 6; or (ii)
          any change, or



                                       26




          any development involving a prospective change, in or affecting the
          condition (financial or otherwise), prospects, earnings, business or
          properties of the Company and its Subsidiaries, taken as a whole,
          whether or not arising from transactions in the ordinary course of
          business, the effect of which, in any case referred to in clause (i)
          or (ii) above, is, in the judgment of Salomon Smith Barney, so
          material and adverse as to make it impractical or inadvisable to
          market the Securities as contemplated by the Final Memorandum
          (exclusive of any amendment or supplement thereto).

                       (h)   The Notes shall have been designated as
          Portal-eligible securities in accordance with the rules and
          regulations of the NASD, and the Notes shall be eligible for clearance
          and settlement through The Depository Trust Company.

                       (i)   Subsequent to the Execution Time, there shall not
          have been any decrease in the rating of any of the Company's debt
          securities (including the Securities) by any "nationally recognized
          statistical rating organization" (as defined for purposes of Rule
          436(g) under the Act) or any notice given of any intended or potential
          decrease in any such rating or of a possible change in any such rating
          that does not indicate the direction of the possible change.

                       (j)   Concurrently with the closing of the offering,
          (i) the Company shall have consummated the New Credit Facility, and
          (ii) either (A) the Existing Credit Facility shall be fully repaid and
          all obligations of the Company and its Subsidiaries thereunder shall
          be satisfied in full and discharged, or (B)(1) the Company will have
          irrevocably deposited with the administrative agent under the Existing
          Credit Facility thereunder funds in an amount sufficient to repay all
          borrowings and obligations under the Existing Credit Facility, (2) the
          lenders under such Existing Credit Facility shall have no claims with
          respect to outstanding borrowings against the Company other than with
          respect to the deposited funds, (3) all covenants thereunder shall
          cease to be in effect, (4) the lending commitments thereunder shall be
          terminated, and (5) within five Business Days of the Closing Date, the
          Existing Credit Facility shall be fully repaid and all borrowings and
          obligations of the Company and its Subsidiaries thereunder shall be
          satisfied in full and discharged, and (iii) in the case of either (A)
          or (B), the Company shall have delivered to the Initial Purchasers
          written evidence to such effect from the administrative agent under
          the Existing Credit Facility.

                       (k)   On or before the Closing Date, the Company shall
          have (i) irrevocably directed Salomon Smith Barney to deposit with the
          trustee under the indentures (the "Existing Indentures") with respect
          to the Company's two series of 9-1/2% Senior Subordinated Notes due
          2007 (the "Existing Notes") of such portion of the proceeds from the
          sale of the Securities hereunder as is necessary to redeem such
          Existing Notes on the earliest date following the Closing Date as is
          permitted by the Existing Indentures, (ii) mailed, or cause to be
          mailed, a notice of redemption required under the Existing Indentures
          to effect the redemption of the Existing Notes pursuant to clause (i)
          above and (iii) furnished the opinions of counsel, officers'
          certificates and other documents necessary to effect a Covenant
          Defeasance (as such term is defined in the Existing Indentures) with
          respect to the Existing Notes in accordance with the applicable



                                       27





          provisions of the Existing Indentures, such Covenant Defeasance to be
          effective upon such irrevocable deposit.

                       (l)   On or before the Closing Date, (i) Communications
          Gratte-Ciel Ltee shall have been voluntarily liquidated and wound up
          into its parent company in accordance with the provisions of the
          Companies Act (Quebec), and (ii) Classified-Extra Limited Partnership
          shall have been dissolved by its partners in accordance with the
          provisions of the Civil Code (Quebec) , and, in the case of each of
          (i) and (ii) the Company shall have delivered a certificate or notice
          of the Company to such effect.

                       (m)   The Company and each Subsidiary Guarantor shall
          have furnished to the Initial Purchasers a certificate of the Company
          and each Subsidiary Guarantor, signed by the Vice President, Corporate
          Controller of the Company and the principal financial officer of each
          Subsidiary Guarantor to the effect that each of the Company and each
          Subsidiary Guarantor is not, and after giving effect to the
          transactions contemplated by this Agreement, including the issuance of
          the Securities and the application of the proceeds thereof as set
          forth in the Final Memorandum, will not be insolvent, as such term is
          defined by, and in accordance with the applicable test therefor
          pursuant to, the laws under which the Company or such Subsidiary
          Guarantor, as applicable, exists.

                       (n)   On or before the Closing Date, Quebecor Media and
          the Company shall have entered into the Subordination Agreement in the
          form attached as Exhibit E to the Indenture.

                       (o)   Prior to the Closing Date, the Company shall have
          furnished to the Initial Purchasers such further information,
          certificates and documents as the Initial Purchasers may reasonably
          request.

                  If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Initial Purchasers and counsel for the
Initial Purchasers, this Agreement and all obligations of the Initial Purchasers
hereunder may be cancelled at, or at any time prior to, the Closing Date by the
Initial Purchasers. Notice of such cancellation shall be given to the Company in
writing or by telephone or facsimile confirmed in writing.

                  7.   REIMBURSEMENT OF EXPENSES. If the sale of the Securities
provided for herein is not consummated because any condition to the obligations
of the Initial Purchasers set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Company or any Subsidiary
Guarantor to perform any agreement herein or comply with any provision hereof
other than by reason of a default by any of the Initial Purchasers, the Company
will reimburse the Initial Purchasers severally through Salomon Smith Barney on
demand for all reasonable out-of-pocket expenses (including reasonable fees and
disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Securities.



                                       28





                  8.   INDEMNIFICATION AND CONTRIBUTION.

                       (a)   The Company and the Subsidiary Guarantors, jointly
          and severally, agree to indemnify and hold harmless each Initial
          Purchaser, the directors, officers, employees and agents of each
          Initial Purchaser and each person who controls any Initial Purchaser
          within the meaning of either the Act or the Exchange Act against any
          and all losses, claims, damages or liabilities, joint or several, to
          which they or any of them may become subject under the Act, the
          Exchange Act or other federal, state or provincial statutory law or
          regulation, at common law or otherwise, insofar as such losses,
          claims, damages or liabilities (or actions in respect thereof) arise
          out of or are based upon any untrue statement or alleged untrue
          statement of a material fact contained in the Preliminary Memorandum,
          the Final Memorandum (or in any supplement or amendment thereto) or
          any information provided by the Company or any Subsidiary Guarantor to
          any holder or prospective purchaser of Securities pursuant to Section
          5(h), or in any amendment thereof or supplement thereto, or arise out
          of or are based upon the omission or alleged omission to state therein
          a material fact required to be stated therein or necessary to make the
          statements therein, in the light of the circumstances under which they
          were made, not misleading, and agrees to reimburse each such
          indemnified party for any legal or other expenses reasonably incurred
          by them, as incurred, in connection with investigating or defending
          any such loss, claim, damage, liability or action; PROVIDED, HOWEVER,
          that the Company and the Subsidiary Guarantors will not be liable in
          any such case to the extent that any such loss, claim, damage or
          liability arises out of or is based upon any such untrue statement or
          alleged untrue statement or omission or alleged omission made in the
          Preliminary Memorandum or the Final Memorandum, or in any amendment
          thereof or supplement thereto, in reliance upon and in conformity with
          written information furnished to the Company by or on behalf of any
          Initial Purchasers through Salomon Smith Barney specifically for
          inclusion therein. This indemnity agreement will be in addition to any
          liability that the Company and the Subsidiary Guarantors may otherwise
          have.

                       (b)   Each Initial Purchaser severally and not jointly
          agrees to indemnify and hold harmless the Company, the Subsidiary
          Guarantors each of its or their directors, each of its or their
          officers, and each person who controls the Company or any Subsidiary
          Guarantor within the meaning of either the Act or the Exchange Act, to
          the same extent as the foregoing indemnity from the Company and the
          Subsidiary Guarantors to each Initial Purchaser, but only with
          reference to written information relating to such Initial Purchaser
          furnished to the Company and the Subsidiary Guarantors by or on behalf
          of such Initial Purchaser through Salomon Smith Barney specifically
          for inclusion in the Preliminary Memorandum or the Final Memorandum
          (or in any amendment or supplement thereto) and agrees to reimburse
          each such indemnified party for any legal or other expenses reasonably
          incurred by them, as incurred, in connection with investigating or
          defending any such loss, claim damage, liability or action. This
          indemnity agreement will be in addition to any liability that any
          Initial Purchaser may otherwise have. The Company and the Subsidiary
          Guarantors acknowledge that the statements set forth in the last
          paragraph of the cover page regarding the delivery of the Securities,
          and, under the heading "Plan of Distribution," paragraphs 6, 8 and 12
          in the Preliminary Memorandum and the Final Memorandum, constitute the
          only information furnished in writing by or on



                                       29





          behalf of the Initial Purchasers for inclusion in the Preliminary
          Memorandum or the Final Memorandum (or in any amendment or supplement
          thereto).

                       (c)   Promptly after receipt by an indemnified party
          under this Section 8 of notice of the commencement of any action, such
          indemnified party will, if a claim in respect thereof is to be made
          against the indemnifying party under this Section 8, notify the
          indemnifying party in writing of the commencement thereof; but the
          failure so to notify the indemnifying party (i) will not relieve it
          from liability under paragraph (a) or (b) above unless and to the
          extent it did not otherwise learn of such action and such failure
          results in the forfeiture by the indemnifying party of substantial
          rights and defenses; and (ii) will not, in any event, relieve the
          indemnifying party from any obligations to any indemnified party other
          than the indemnification obligation provided in paragraph (a) or (b)
          above. The indemnifying party shall be entitled to appoint counsel of
          the indemnifying party's choice at the indemnifying party's expense to
          represent the indemnified party in any action for which
          indemnification is sought (in which case the indemnifying party shall
          not thereafter be responsible for the fees and expenses of any
          separate counsel retained by the indemnified party or parties except
          as set forth below); PROVIDED, HOWEVER, that such counsel shall be
          satisfactory to the indemnified party. Notwithstanding the
          indemnifying party's election to appoint counsel to represent the
          indemnified party in an action, the indemnified party shall have the
          right to employ separate counsel (including local counsel), and the
          indemnifying party shall bear the reasonable fees, costs and expenses
          of such separate counsel if (i) the use of counsel chosen by the
          indemnifying party to represent the indemnified party would present
          such counsel with a conflict of interest; (ii) the actual or potential
          defendants in, or targets of, any such action include both the
          indemnified party and the indemnifying party and the indemnified party
          shall have reasonably concluded that there may be legal defenses
          available to it and/or other indemnified parties that are different
          from or additional to those available to the indemnifying party; (iii)
          the indemnifying party shall not have employed counsel satisfactory to
          the indemnified party to represent the indemnified party within a
          reasonable time after notice of the institution of such action; or
          (iv) the indemnifying party shall authorize the indemnified party to
          employ separate counsel at the expense of the indemnifying party. An
          indemnifying party will not, without the prior written consent of the
          indemnified parties, settle or compromise or consent to the entry of
          any judgment with respect to any pending or threatened claim, action,
          suit or proceeding in respect of which indemnification or contribution
          may be sought hereunder (whether or not the indemnified parties are
          actual or potential parties to such claim or action) unless such
          settlement, compromise or consent includes an unconditional release of
          each indemnified party from all liability arising out of such claim,
          action, suit or proceeding.

                       (d)   In the event that the indemnity provided in
          paragraph (a) or (b) of this Section 8 is unavailable to or
          insufficient to hold harmless an indemnified party for any reason, the
          Company, the Subsidiary Guarantors and the Initial Purchasers agree to
          contribute to the aggregate losses, claims, damages and liabilities
          (including legal or other expenses reasonably incurred in connection
          with investigating or defending same) (collectively "Losses") to which
          the Company or any Subsidiary Guarantor and one or more of the Initial
          Purchasers may be subject in such proportion as is appropriate to
          reflect the relative benefits received by the Company and the
          Subsidiary Guarantors on



                                       30





          the one hand and by the Initial Purchasers on the other from the
          offering of the Securities; PROVIDED, HOWEVER, that in no case shall
          any Initial Purchaser (except as may be provided in any agreement
          among the Initial Purchasers relating to the offering of the
          Securities) be responsible for any amount in excess of the purchase
          discount or commission applicable to the Securities purchased by such
          Initial Purchaser hereunder. If the allocation provided by the
          immediately preceding sentence is unavailable for any reason, the
          Company, the Subsidiary Guarantors and the Initial Purchasers shall
          contribute in such proportion as is appropriate to reflect not only
          such relative benefits but also the relative fault of the Company and
          the Subsidiary Guarantors on the one hand and of the Initial
          Purchasers on the other in connection with the statements or omissions
          that resulted in such Losses, as well as any other relevant equitable
          considerations. Benefits received by the Company and the Subsidiary
          Guarantors shall be deemed to be equal to the total net proceeds from
          the offering (before deducting expenses) received by the Company, and
          benefits received by the Initial Purchasers shall be deemed to be
          equal to the total purchase discounts and commissions in each case set
          forth on the cover page of the Final Memorandum. Relative fault shall
          be determined by reference to, among other things, whether any untrue
          or any alleged untrue statement of a material fact or the omission or
          alleged omission to state a material fact relates to information
          provided by the Company or a Subsidiary Guarantor on the one hand or
          the Initial Purchasers on the other, the intent of the parties and
          their relative knowledge, access to information and opportunity to
          correct or prevent such untrue statement or omission. The Company, the
          Subsidiary Guarantors and the Initial Purchasers agree that it would
          not be just and equitable if contribution were determined by pro rata
          allocation or any other method of allocation that does not take
          account of the equitable considerations referred to above.
          Notwithstanding the provisions of this paragraph (d), no person guilty
          of fraudulent misrepresentation (within the meaning of Section 11(f)
          of the Act) shall be entitled to contribution from any person who was
          not guilty of such fraudulent misrepresentation. For purposes of this
          Section 8, each person who controls an Initial Purchaser within the
          meaning of either the Act or the Exchange Act and each director,
          officer, employee and agent of an Initial Purchaser shall have the
          same rights to contribution as such Initial Purchaser, and each person
          who controls the Company or a Subsidiary Guarantor within the meaning
          of either the Act or the Exchange Act and each officer and director of
          the Company and any Subsidiary Guarantor shall have the same rights to
          contribution as the Company and the Subsidiary Guarantors, subject in
          each case to the applicable terms and conditions of this paragraph
          (d).

                  9.   DEFAULT BY AN INITIAL PURCHASER. If any one or more
Initial Purchasers shall fail to purchase and pay for any of the Securities
agreed to be purchased by such Initial Purchaser hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Initial Purchasers shall be
obligated severally to take up and pay for (in the respective proportions which
the amount of Securities set forth opposite their names in Schedule I hereto
bears to the aggregate amount of Securities set forth opposite the names of all
the remaining Initial Purchasers) the Securities which the defaulting Initial
Purchaser or Initial Purchasers agreed but failed to purchase; PROVIDED,
HOWEVER, that in the event that the aggregate amount of Securities that the
defaulting Initial Purchaser or Initial Purchasers agreed but failed to purchase
shall exceed 10% of the aggregate amount of Securities set forth in Schedule I
hereto, the remaining Initial Purchasers shall have



                                       31





the right to purchase all, but shall not be under any obligation to purchase
any, of the Securities, and if such nondefaulting Initial Purchasers do not
purchase all the Securities, this Agreement will terminate without liability to
any nondefaulting Initial Purchaser or the Company or the Subsidiary Guarantors.
In the event of a default by any Initial Purchaser as set forth in this Section
9, the Closing Date shall be postponed for such period, not exceeding five
Business Days, as Salomon Smith Barney shall determine in order that the
required changes in the Final Memorandum or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Initial Purchaser of its liability, if any, to the Company, the
Subsidiary Guarantors or any nondefaulting Initial Purchaser for damages
occasioned by its default hereunder.

                  10.  TERMINATION. This Agreement shall be subject to
termination in the absolute discretion of Salomon Smith Barney, by notice given
to the Company prior to delivery of and payment for the Securities, if at any
time prior to such time (i) trading in securities generally on the New York
Stock Exchange or the Toronto Stock Exchange shall have been suspended or
limited or minimum prices shall have been established on either of such
Exchanges; (ii) a banking moratorium shall have been declared either by
Canadian, United States or New York State authorities; or (iii) there shall have
occurred any outbreak or escalation of hostilities, declaration by Canada or the
United States of a national emergency or war or other calamity or a crisis the
effect of which on the financial markets is such as to make it, in the judgment
of Salomon Smith Barney, impracticable or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Final Memorandum
(exclusive of any amendment or supplement thereto).

                  11.  REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The
respective agreements, representations, warranties, indemnities and other
statements of the Company, the Subsidiary Guarantors or its or their officers
and of the Initial Purchasers set forth in or made pursuant to this Agreement
will remain in full force and effect, regardless of any investigation made by or
on behalf of the Initial Purchasers or the Company, the Subsidiary Guarantors or
any of the officers, directors, employees, agents or controlling persons
referred to in Section 8 hereof, and will survive delivery of and payment for
the Securities. The provisions of Sections 7 and 8 hereof shall survive the
termination or cancellation of this Agreement.

                  12.  NOTICES. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Initial Purchasers, will be
mailed, delivered or telefaxed to the Salomon Smith Barney, General Counsel (fax
no.: (212) 816-7912) and confirmed to the General Counsel, Salomon Smith Barney
at 388 Greenwich Street, New York, New York 10013 Attention: General Counsel,
or, if sent to the Company or any Subsidiary Guarantor, will be mailed,
delivered or telefaxed to (a) Sun Media Corporation, Vice President, Corporate
Controller (fax no.: (416) 947-3119) and confirmed to it at 333 King Street
East, Toronto, Ontario M5A 3X5, Canada, attention of the Vice President,
Corporate Controller and (b) Quebecor Media Inc., Vice President and Treasurer
(fax no.: (514) 380-1983) and confirmed to it at 300 Viger Avenue East,
Montreal, Quebec H2X 3W4, Canada, attention of Vice President and Treasurer.

                  13.  SUCCESSORS. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers, directors, employees,



                                       32





agents and controlling persons referred to in Section 8 hereof, and, except as
expressly set forth in Section 5(h) hereof, no other person will have any right
or obligation hereunder.

                  14.  APPLICABLE LAW. This Agreement will be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.

                  The Company and each Subsidiary Guarantor hereby submits to
the non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby. The Company
and each Subsidiary Guarantor irrevocably appoints CT Corporation System, as its
authorized agent in the Borough of Manhattan in The City of New York upon which
process may be served in any such suit or proceeding, and agrees that service of
process upon such agent, and written notice of said service to the Company or
any Subsidiary Guarantor, by the person serving the same to the address provided
in Section 12, shall be deemed in every respect effective service of process
upon the Company or such Subsidiary Guarantor in any such suit or proceeding.
The Company and the Subsidiary Guarantors further agree to take any and all
action as may be necessary to maintain such designation and appointment of such
agent in full force and effect for a period of seven years from the date of this
Agreement.

                  The obligation of the Company and the Subsidiary Guarantors in
respect of any sum due to any Initial Purchaser, notwithstanding any judgment in
a currency other than United States dollars, shall not be discharged until the
first Business Day following receipt by such Initial Purchaser of any sum
adjudged to be so due in such other currency, on which (and only to the extent
that) such Initial Purchaser may in accordance with normal banking procedures
purchase United States dollars with such other currency; if the United States
dollars so purchased are less than the sum originally due to such Initial
Purchaser hereunder, the Company and the Subsidiary Guarantors agree, as a
separate obligation and notwithstanding any such judgment, to indemnify such
Initial Purchaser against such loss. If the United States dollars so purchased
are greater than the sum originally due to such Initial Purchaser hereunder,
such Initial Purchaser agrees to pay to the Company and the Subsidiary
Guarantors an amount equal to the excess of the dollars so purchased over the
sum originally due to such Initial Purchaser hereunder.

                  15.  COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument.

                  16.  HEADINGS. The section headings used herein are for
convenience only and shall not affect the construction hereof.

                  17.  DEFINITIONS. The terms that follow, when used in this
Agreement, shall have the meanings indicated.

                  "Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.

                  "Affiliate" shall have the meaning specified in Rule 501(b)
of Regulation D.



                                       33





                  "Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in The City of New York.

                  "Capital Stock" means, with respect to any Person, any shares
or other equivalents (however designated) of any class of corporate stock or
partnership interests or any other participations, rights, warrants, options or
other interests in the nature of an equity interest in such Person, including
preferred stock, but excluding any debt security convertible or exchangeable
into such equity interest.

                  "Commission" shall mean the Securities and Exchange
Commission.

                  "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.

                  "Execution Time" shall mean, the date and time that this
Agreement is executed and delivered by the parties hereto.

                  "Investment Company Act" shall mean the Investment Company Act
of 1940, as amended, and the rules and regulations of the Commission promulgated
thereunder.

                  "NASD" shall mean the National Association of Securities
Dealers, Inc.

                  "Person" shall mean any individual, corporation, company
(including any limited liability company), association, partnership, joint
venture, trust, unincorporated organization, government or any agency or
political subdivision thereof or any other entity.

                  "Regulation D" shall mean Regulation D under the Act.

                  "Regulation S" shall mean Regulation S under the Act.

                  "Salomon Smith Barney" shall mean Salomon Smith Barney Inc.

                  "Subsidiary" shall mean in respect of any Person, any
corporation, company (including any limited liability company), association,
partnership, joint venture, trust, unincorporated organization or other business
entity of which a majority of the total voting power of all classes of Capital
Stock then outstanding and normally entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or trustees
thereof, is at the time owned or controlled, directly or indirectly, by:

                  (a) such Person,

                  (b) such Person and one or more Subsidiaries of such Person,
or

                  (c) one or more Subsidiaries of such Person.

                  "Trust Indenture Act" shall mean the Trust Indenture Act of
1939, as amended, and the rules and regulations of the Commission promulgated
thereunder.



                                       34





                  If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this Agreement and your acceptance shall represent a binding agreement
among the Company, the Guarantors and the several Initial Purchasers.

                                        Very truly yours,



                                        SUN MEDIA CORPORATION

                                        By: /s/ Claudine Tremblay
                                           ------------------------------------
                                           Name:  Claudine Tremblay
                                           Title: Secretary



                                        BOWES PUBLISHERS LIMITED

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary



                                        SUN MEDIA (TORONTO) CORPORATION

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary



                                        SMC NOMINEECO INC.

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary



                                        TORONTO SUN INTERNATIONAL, INC.

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary









                                        TS PRINTING, INC.

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary



                                        FLORIDA SUN PUBLICATIONS, INC.

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary



                                        3351611 CANADA INC.

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary



                                        3661458 CANADA INC.

                                        By: /s/ Claudine Tremblay
                                            -----------------------------------
                                            Name:  Claudine Tremblay
                                            Title: Assistant Secretary









The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

SALOMON SMITH BARNEY INC.
RBC DOMINION SECURITIES CORPORATION
TD SECURITIES (USA) INC.
BMO NESBITT BURNS CORP.
CREDIT SUISSE FIRST BOSTON CORPORATION
SCOTIA CAPITAL (USA) INC.
CIBC WORLD MARKETS CORP.

By:  SALOMON SMITH BARNEY INC.


By: /s/ Philip Lucchese
    --------------------------
     Name: Philip Lucchese
     Title: Vice President

For themselves and the other several Initial
Purchasers named in Schedule I to
the foregoing Agreement.






                                   SCHEDULE I






                                                                                         Principal Amount of
INITIAL PURCHASERS                                                                    SECURITIES TO BE PURCHASED
- ------------------                                                                    --------------------------
                                                                                                
Salomon Smith Barney Inc...............................................                          US$82,000,000
RBC Dominion Securities Corporation....................................                             30,750,000
TD Securities (USA) Inc................................................                             23,062,500
BMO Nesbitt Burns Corp.................................................                             23,062,500
Credit Suisse First Boston Corporation.................................                             15,375,000
Scotia Capital (USA) Inc...............................................                             15,375,000
CIBC World Markets Corp................................................                             15,375,000
                                                                                      --------------------------

         Total.........................................................                        US$ 205,000,000




                                      I-1




                                                                       Exhibit A



                       SELLING RESTRICTIONS FOR OFFERS AND
                         SALES OUTSIDE THE UNITED STATES

                  (1)(a) Each Initial Purchaser acknowledges that the Securities
have not been and will not be registered under the Act and may not be offered or
sold within the United States or to, or for the account or benefit of, U.S.
persons except in accordance with Regulation S under the Act or pursuant to an
exemption from the registration requirements of the Act. Each Initial Purchaser
represents and agrees that, except as otherwise permitted by Section 4(a) of the
Agreement to which this is an exhibit, it has offered and sold the Securities,
and will offer and sell the Securities, (i) as part of its distribution at any
time; and (ii) otherwise until 40 days after the later of the commencement of
the offering and the Closing Date, only in accordance with Rule 903 of
Regulation S or Rule 144A under the Act. Accordingly, each Initial Purchaser
represents and agrees that neither it, nor any of its Affiliates nor any person
acting on its or their behalf has engaged or will engage in any directed selling
efforts with respect to the Securities, and that it and they have complied and
will comply with the offering restrictions requirement of Regulation S. Each
Initial Purchaser agrees that, at or prior to the confirmation of sale of
Securities (other than a sale of Securities pursuant to Section 4(a) of the
Agreement to which this is an exhibit), it shall have sent to each distributor,
dealer or person receiving a selling concession, fee or other remuneration that
purchases Securities from it during the distribution compliance period a
confirmation or notice to substantially the following effect:

                  "The Securities covered hereby have not been registered under
                  the U.S. Securities Act of 1933 (the "Act") and may not be
                  offered or sold within the United States or to, or for the
                  account or benefit of, U.S. persons (i) as part of their
                  distribution at any time or (ii) otherwise until 40 days after
                  the later of the commencement of the offering and February 7,
                  2003, except in either case in accordance with Regulation S or
                  Rule 144A under the Act. Terms used above have the meanings
                  given to them by Regulation S under the Act."

                  (b) Each Initial Purchaser also represents and agrees that it
         has not entered and will not enter into any contractual arrangement
         with respect to the distribution of the Securities, except with its
         Affiliates or with the prior written consent of the Company.

                  (c) Terms used in this section have the meanings given to them
         by Regulation S.

                  (2) Each Initial Purchaser represents and agrees that (i) it
has not offered or sold and prior to the expiry of the period of six months from
the closing of the offering of the Securities, will not offer or sell any
Securities to persons in the United Kingdom, except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or
otherwise in circumstances that have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995; (ii) it has complied and will comply with
all applicable provisions of the Financial Services and Markets



                                      A-1





Act 2000 (the "FSMA") with respect to anything done by it in relation to the
Securities in, from or otherwise involving the United Kingdom; and (iii) it has
only communicated or caused to be communicated and will only communicate or
cause to be communicated any invitation or inducement to engage in investment
activity (within the meaning of section 21 of the FSMA) received by it in
connection with the issue or sale of any Securities in circumstances in which
section 21(1) of the FSMA would not apply to the Company.

                  (3) Each of the Initial Purchasers severally represents and
warrants and agrees that it will not offer or sell the Securities in any
province or territory of Canada except as contemplated by the Canadian Offering
Memorandum of even date herewith.



                                      A-2




                                                                       Exhibit B



                              MATERIAL SUBSIDIARIES


SUBSIDIARY NAME                        JURISDICTION OF INCORPORATION
- ---------------                        -----------------------------

Bowes Publishers Limited               Canada
Sun Media (Toronto) Corporation        Ontario




                                      B-1




                                                                       Exhibit C


                               MATERIAL AGREEMENTS


1.       Management Services Agreement dated January 17, 2003 between the
         Company and Quebecor Media.

2.       Indenture relating to $150,000,000 9 1/2% Senior Subordinated Notes due
         2007, dated as of February 19, 1997, between the Company and United
         States Trust Company of New York, together with the First Supplemental
         Indenture, dated as of December 15, 1997, the Second Supplemental
         Indenture, dated as of December 31, 1998, and the Third Supplemental
         Indenture, dated as of February 28, 1999 (the "First Indenture").

3.       Indenture relating to $90,000,000 9 1/2% Senior Subordinated Notes due
         2007, dated as of May 20, 1997, between the Company and United States
         Trust Company of New York, together with the First Supplemental
         Indenture, dated as of December 15, 1997, the Second Supplemental
         Indenture, dated as of December 31, 1998, and the Third Supplemental
         Indenture, dated as of February 28, 1999 (the "Second Indenture").

4.       Guarantee dated December 31, 1998 executed by Sun Media (Toronto)
         Corporation with respect to the First Indenture.

5.       Guarantee dated December 31, 1998 executed by Sun Media (Toronto)
         Corporation with respect to the Second Indenture.

6.       Guarantee dated December 31, 1998 executed by SMC Nomineeco Inc. with
         respect to the First Indenture.

7.       Guarantee dated December 31, 1998 executed by SMC Nomineeco Inc. with
         respect to the Second Indenture.

8.       Amended and Restated Credit Agreement dated as of April 1, 2000, as
         amended, between the Company, as borrower, certain financial
         institutions, Royal Bank of Canada, as Administrative Agent and Credit
         Suisse First Boston Canada, as Documentation Agent.

9.       Newsprint Purchase Contract dated January 1, 2000 between the Company
         and Imprimeries Quebecor Inc., as purchasers, and Les Produits
         Forestiers Donahue Inc., as vendor.

10.      $1,600,000,000 12.15% convertible obligation dated July 9, 2001 between
         the Company and Quebecor Media which is due on July 14, 2007.

11.      $500,000,000 12.25% convertible obligation dated July 9, 2001 between
         Bowes Publishers Limited and the Company which is due on July 14, 2007.

12.      $350,000,000 12.15% convertible obligation dated November 28, 2002
         between the Company and Quebecor Media which is due on November 28,
         2008.


                                      C-1




13.      $350,000,000 12.25% convertible obligation dated November 28, 2002
         between Sun Media (Toronto) Corporation and the Company which is due on
         November 28, 2008.

14.      Sales and Service Agreement dated October 10, 2002 between Le Journal
         de Montreal and Printing Press Services International Ltd.

15.      Partnership Agreement for Dynamic Press Group dated August 5, 1996
         between The News Group, a division of Jim Pattison International Ltd.,
         and Groupe de Presse Quebecor Inc.

16.      Partnership Agreement for CP24 dated March 1, 2000 between CHUM
         Limited, 1401735 Ontario Inc. and 3661458 Canada Inc.

17.      Shareholders' Agreement for Le Courier du Sud (1998) Inc. dated June
         30, 1998 between La Compagnie D'Impriemiere et de Publication de la
         Rive-Sud Limited, Les Placements Jean-Paul Auclair Inc., Jean-Paul
         Auclair, Communications Quebecor Inc. and Le Courier du Sud (1998) Inc.

18.      Lease Agreement dated June 1, 2002 between HMR Properties Inc., as
         lessor, and the Company, as lessee, for the premises located at 4990-92
         Avenue, Edmonton, Alberta.

19.      Lease Extension Agreement dated October 1, 1996 between Camden Partners
         1 Inc., as sub-landlord, and The Toronto Sun Publishing Corporation, as
         sub-tenant, for 1380 Hunt Club Road, Ottawa, Ontario.



                                      C-2

EX-3.5

                                  DUPLICATE

[BRITISH COLUMBIA LOGO]                                             Exhibit 3.5
                                                                Number C-630301



                                 CERTIFICATE
                                     OF
                                CONTINUATION

                                 COMPANY ACT








I HEREBY CERTIFY THAT BOWES PUBLISHERS LIMITED, which was incorporated under
the laws of Canada, has this day been granted a Certificate of Continuation
under the COMPANY ACT








                            ISSUED UNDER MY HAND AT VICTORIA, BRITISH COLUMBIA,
                                           ON JULY 03, 2001



                                          /s/ John S. Powell
                                     ----------------------------
                                             JOHN S. POWELL
                                        REGISTRAR OF COMPANIES
                                     PROVINCE OF BRITISH COLUMBIA
                                                 CANADA





                                                              

BRITISH                      Mailing Address:                       INSTRUMENT OF CONTINUATION
COLUMBIA                     PO Box 9431 Stn Prov Govt               (Section 36 Company Act)
                             Victoria BC V8W 9V3

                             Location:                                          FORM 23
Ministry of Finance          2nd Floor - 940 Blanchard Street
and Corporate Relations      Victoria BC
                                                                    --------------------------------------------------------------
Corporate and Personal       Telephone:  (250) 356-8649             FREEDOM OF INFORMATION AND PROTECTION OF PRIVACY ACT (FIPPA).
Property Registries                            356-8654             The personal Information requested on this form is made
                                               356-8651             available to the public under the authority of the Company Act.
                                                                    Questions about how the FIPPA applies to this personal
                                                                    information can be directed to the Administrative Analyst.
                                                                    Corporate and Personal Property Registries at (250) 356-0944,
                                                                    PO Box 9431 Stn Prov Govt., Victoria BC V8W 9V3.
                                                                    --------------------------------------------------------------



- ------------------------------------------------------------------------------
1. Full name of corporation                                                   |
- ------------------------------------------------------------------------------
|  BOWES PUBLISHERS LIMITED                                                   |
- ------------------------------------------------------------------------------
                              
2. Date of incorporation
   or amalgamation               3. Current jurisdiction of incorporation
- -------------------------------  -----------------------------------------------
|  YYYY            MM     DD   | |  CANADA                                     |
 1 | 9 | 9 | 6 | 0 | 3 | 1 | 8 | |                                             |
- ------------------------------   -----------------------------------------------




4. List the charter documents of the corporation - ATTACH COPIES, VERIFIED BY
   THE PROPER GOVERNMENT AUTHORITY IN THE COMPANY'S CURRENT JURISDICTION.
   PLEASE REFER TO INSTRUCTIONS FOR DEFINITION AND REQUIREMENTS FOR VERIFYING
   CHARTER DOCUMENTS.

                               
DATE OF DOCUMENT                  NATURE OF DOCUMENT
- ------------------------------------------------------------------------------------------
|  YYYY            MM      DD   |                                                         |
| 1 | 9 | 9 | 6 | 0 | 3 | 1 | 8 | CERTIFICATE OF AMALGAMATION AND ARTICLES OF AMALGAMATION|
- ------------------------------------------------------------------------------------------
|  YYYY            MM      DD   |                                                         |
| 1 | 9 | 8 | 0 | 1 | 0 | 0 | 6 | BYLAW 14               STAMPED FILED AND REGISTERED     |
- ------------------------------------------------------------------------------------------
|  YYYY            MM      DD   |                                                         |
| 1 | 9 | 8 | 0 | 1 | 0 | 2 | 4 | BYLAW 15                                                |
- ------------------------------------------------------------------------------------------
|  YYYY            MM      DD   |                                JUL 03 2001              |
|   |   |   |   |   |   |   |   |                                                         |
- ------------------------------------------------------------------------------------------
|  YYYY            MM      DD   |                           REGISTRAR OF COMPANIES        |
|   |   |   |   |   |   |   |   |                                                         |
- ------------------------------------------------------------------------------------------



5. Full names and residential addresses of all directors of the corporation

                                                                                                        
LAST NAME          FIRST NAME AND INITIALS (IF ANY)     RESIDENTIAL ADDRESS              CITY              PROV.       POSTAL CODE
- ----------------------------------------------------------------------------------------------------------------------------------
|     SEE SCHEDULE |"A" ATTACHED                        |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------
|                  |                                    |                                |                 |           |          |
- ----------------------------------------------------------------------------------------------------------------------------------




FIN 796 Rev. 1999/8/10






names and residential addresses of all officers of the corporation




NAME       FIRST NAME AND INITIALS (IF ANY)    OFFICE HELD    RESIDENTIAL ADDRESS    CITY          PROV.             POSTAL CODE
                                                                                                    
- ---------------------------------------------------------------------------------------------------------------------------------
SEE SCHEDULE "B" ATTACHED
- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------



7.   Is the corporation a reporting company as defined by the British
     Columbia COMPANY ACT? (See Definitions)   /  / YES    /X/ NO

8.   The corporation hereby adopts the memorandum and articles drawn pursuant
     to the British Columbia COMPANY ACT. These are appended hereto as
     schedules 1 and 2 and initialled for identification by an officer or
     director.
- ------------------------------------------------------------------------------
WITNESS
In witness whereof, the Corporation has executed these presents.

SIGNATURE OF DIRECTOR OR OFFICER                   DATE SIGNED
- ------------------------------------------------------------------------------
                                                   YYYY     MM      DD
/s/                                                12/0/0/1/0/6/2/7/
- ------------------------------------------------------------------------------


AFFIDAVIT

NAME OF CORPORATION
- ------------------------------------------------------------------------------

BOWES PUBLISHERS LIMITED
- ------------------------------------------------------------------------------

I                       CLAUDINE TREMBLAY                            ,
 --------------------------------------------------------------------
   NAME OF DIRECTOR OR OFFICER (must be same person who signed above)

solemnly declare that the information contained in this statement is true and
correct and I make the solemn declaration conscientiously believing it to be
true, and knowing that it is of the same force and effect as if made under
oath and by virtue of the CANADA EVIDENCE ACT.

Declared before me /s/ Francine Dalbec-Roy at Montreal (Quebec)
                   -----------------------    -----------------

                YYYY     MM    DD
                12/0/0/1/0/6/2/7/
on   --------------------------------

Declared before a notary public or Commissioner for Oaths and Affidavits



- ----------------------------------------------------------------------------------------------
NAME OF NOTARY PUBLIC OR COMMISSIONER               SIGNATURE OF NOTARY PUBLIC OR COMMISSIONER
                                                 
- ----------------------------------------------------------------------------------------------

FRANCINE DALBEC-ROY 138354                          /s/ Francine Dalbec-Roy
- ----------------------------------------------------------------------------------------------
ADDRESS OF NOTARY PUBLIC OR COMMISSIONER

1981 McGill College - S.110d Montreal (Quebec) H3A 3C1
- ----------------------------------------------------------------------------------------------








                                                         SCHEDULE "A"
                                                 BOWES PUBLISHERS LIMITED
                                                    LIST OF DIRECTORS




LAST NAME  FIRST NAME AND INITIALS             RESIDENTIAL ADDRESS    CITY          PROV.        POSTAL CODE
                                                                                  
- ---------------------------------------------------------------------------------------------------------------------------------
Dempsey    William R.                          21 Brentwood Crescent  London        Ontario      N6G 1X4
- ---------------------------------------------------------------------------------------------------------------------------------
Francoeur  Pierre                              177, rue Chamonix      Sainte-Adele  Quebec       J0R 1L0
- ---------------------------------------------------------------------------------------------------------------------------------
Roper      Thomas A.                           4036 West 28th Avenue  Vancouver     British      V6S 1S8
                                                                                    Columbia
- ---------------------------------------------------------------------------------------------------------------------------------

- ---------------------------------------------------------------------------------------------------------------------------------






                                             SCHEDULE "B"

                                       BOWES PUBLISHERS LIMITED
                                          LIST OF OFFICERS




- ---------------------------------------------------------------------------------------------------------------------
  LAST       FIRST                                                                                       POSTAL
  NAME       NAME           OFFICE HELD              RESIDENTIAL ADDRESS          CITY        PROV.      CODE
- ---------------------------------------------------------------------------------------------------------------------
                                                                                       

Dempsey      William R.     President and Chief      21 Brentwood Crescent        London      Ontario    N6G 1X4
                            Executive Officer
- ---------------------------------------------------------------------------------------------------------------------
Jebb         B. Wayne       Senior Vice President    337-23248 Township Rd. 522   Sherwood    Alberta    T8B 1H5
                            and Chief Operating                                   Park
                            Officer
- ---------------------------------------------------------------------------------------------------------------------
Lee          Kin-Man        Vice President,          50 Kanata Crescent           London      Ontario    N6J 4S6
                            Finance and
                            Administration and
                            Secretary
- ---------------------------------------------------------------------------------------------------------------------
Poulin       Daniel         Treasurer                14, Place Mailly             Ville       Quebec     J6Z 4L5
                                                                                  Lorraine
- ---------------------------------------------------------------------------------------------------------------------
Saint-       Louis          Assistant Secretary      1291, rue Noiseux            Mont St-    Quebec     J3G 4S6
Arnaud                                                                            Hilaire
- --------------------------------------------------------------------------------------------------------------------
Tremblay     Claudine       Assistant Secretary      101, rue des Passereaux      Ile des     Quebec     H3E 1X3
                                                                                  Soeurs
- ---------------------------------------------------------------------------------------------------------------------






                                  SCHEDULE 1


                                 COMPANY ACT


                             M E M O R A N D U M







1. The name of the company is BOWES PUBLISHERS LIMITED

2. The authorized capital of the company consists of Twenty Billion
(20,000,000,000) Shares divided into:

   (a) Ten Billion (10,000,000,000) Class A Common Shares without par value

   (b) Ten Billion (10,000,000,000) Class B Preferred Shares without par value

   with the special rights and restrictions attached thereto as set forth in
   the Articles of the Company.




                                   SCHEDULE 2

                                    ARTICLES

                                       OF

                            BOWES PUBLISHERS LIMITED




                                TABLE OF CONTENTS
                                                                       
PART 1 - INTERPRETATION....................................................3

PART 2 - ISSUE OF SHARES...................................................3

PART 3 - SHARE CERTIFICATES................................................4

PART 4 - TRANSFER OF SHARES, GENERAL.......................................4

PART 5 - TRANSMISSION OF SHARES............................................5

PART 6 - BORROWING AND CAPITAL.............................................5

PART 7 - MEETINGS..........................................................6

PART 8 - PROCEEDINGS AT GENERAL MEETINGS...................................7

PART 9 - VOTES OF MEMBERS..................................................9

PART 10 - DIRECTORS.......................................................10

PART 11 - INDEMNIFICATION.................................................12

PART 12 - PROCEEDINGS OF DIRECTORS........................................14

PART 13 - OFFICERS........................................................15

PART 14 - EXECUTION OF INSTRUMENTS........................................16

PART 15 - DIVIDENDS.......................................................16

PART 16 - ACCOUNTS........................................................17

PART 17 - NOTICES.........................................................17

PART 18 - FEES............................................................18

PART 19 - TRANSFER OF SHARES. RESTRICTIONS................................18

PART 20 - SPECIAL RIGHTS AND RESTRICTIONS.................................19






                            PART 1 - INTERPRETATION

1.1  In these Articles, unless the context otherwise requires:

     (a)  "directors" means the director or directors of the Company for the
          time being;

     (b)  "Company Act" means the Company Act of the Province of British
          Columbia from time to time in force and all amendments thereto and all
          Regulations and amendments thereto made pursuant to that Act;

     (c)  "register" means the register of members to be kept pursuant 1:0 the
          Company Act;

     (d)  "registered address" of a member means his address as recorded in the
          register;

     (e)  "registered address" of a director means his address as recorded in
          the Company's register of directors to be kept at the records office
          of the Company pursuant to the Company Act.

1.2  Words importing the singular include the plural and vice versa, and words
     importing a male person include a female person and a corporation.

1.3  The definitions in the Company Act in force and as amended from time to
     time shall, with necessary changes and so far as applicable, apply to these
     Articles.

1.4  The regulations contained in Table A in the First Schedule to the Company
     Act shall not apply to the Company.


                            PART 2 - ISSUE OF SHARES

2.1  Subject to the Company Act and to these Articles, the issue of shares of
     the Company shall be under the control of the directors who may, subject to
     the rights of holders of shares of the Company for the time being
     outstanding, allot or otherwise dispose of, and/or grant options on, shares
     authorized but not yet issued at such times and to such persons, including
     directors, and in such manner and upon such terms and conditions and at
     such price or for such consideration as the directors in their absolute
     discretion may determine.

2.2  Whenever the Company is not a reporting company, the directors, before
     allotting any shares, shall first offer those shares pro rata to the
     members, but where there are classes of shares, the directors shall first
     offer the shares to be allotted pro rata to the members holding shares of
     the class proposed to be allotted, and, if any shares remain, the directors
     shall then offer the remaining shares pro rata to the other members. The
     offer shall be made by notice specifying the number of shares offered and
     the time, which shall be not less than seven days, for acceptance of the
     offer. After the expiration of the time for acceptance or on receipt of
     written confirmation from the person to whom such an offer is made that he
     declines to accept the offer, and where there are no other members holding
     shares who should first receive an offer, the directors may, for three
     months thereafter, offer shares to such persons and in such manner as they
     think most beneficial to the Company, but the offer to those persons shall
     not be at a price less than, or on terms more favourable than, the offer to
     the members. Whenever the Company is a reporting company, the directors may
     allot and issue its shares at such times and in such manner and to such
     persons or class of persons as the directors may determine and as the
     Company Act, the Securities Act, and all other applicable laws permit.

2.3  When the Company is authorized to issue shares without par value, the
     directors are authorized to determine the price or consideration for which
     such shares shall be allotted or issued, and notwithstanding that the price
     or


                                      -4-

     consideration for a share may be other than cash, the price or
     consideration for a share shall, at the time when the share is allotted, be
     expressed in terms of money and so recorded in the proceedings of the
     directors of the Company.

2.4  No share shall be issued until the Company has received the full
     consideration therefore in cash, property, or services, provided that:

     (a)  a document or book account evidencing indebtedness of the allottee
          does not constitute property;

     (b)  services shall be past services actually performed for the Company;
          and,

     (c)  the value of property or services shall be the value the directors
          determine by resolution to be, in all the circumstances of the
          transaction, the fair market value.

2.5  Subject to the provisions and restrictions contained in the Company Act
     applicable to the shares without par value or otherwise, the Company may
     pay a commission or allow a discount in an amount not exceeding 25% of the
     amount of the subscription price to any person in consideration of his
     subscribing or agreeing to subscribe, or procuring or agreeing to procure
     subscriptions, whether absolutely or conditionally for shares. The Company
     may pay such brokerage as may be lawful.


                          PART 3 - SHARE CERTIFICATES

3.1  Every share certificate issued by the Company shall be in such form as the
     directors approve and shall comply with the requirements of the Company
     Act.

3.2  If any share certificate is worn out or defaced, then upon production of
     that certificate to the directors or the transfer agent of the Company, the
     directors or that transfer agent may declare the same to be cancelled and
     cause it to be so marked and may issue a new certificate in place of the
     certificate cancelled. If any share certificate is lost or destroyed, then,
     upon proof of the loss or destruction to the satisfaction of the directors,
     and upon giving such indemnity as the directors deem adequate, a new
     certificate shall be issued to the party entitled to it. In any such case
     where a new share certificate is issued, the fee prescribed in Part 18 of
     these Articles must be paid if requested.

3.3  A share certificate registered in the names of two or more persons shall be
     delivered to the person first named on the register.


                      PART 4 - TRANSFER OF SHARES, GENERAL

4.1  Subject to the restrictions, if any, set forth in these Articles, any
     member may transfer his shares by instrument in writing executed by or on
     behalf of such member and delivered to the Company or its transfer agent.
     The instrument of transfer of any share of the Company shall be in the
     form, if any, on the back of the certificate of the share being
     transferred, or in any other form which the directors may approve. If the
     directors so require, each instrument of transfer shall be in respect of
     only one class of shares.

4.2  Every instrument of transfer shall be executed by the transferor and left
     at the registered office of the Company or at an authorized office of its
     transfer agent for registration, together with the certificate for the
     shares to be transferred and such other evidence, if any, as the directors
     or the transfer agent may require to prove the title of the transferor or
     his right to transfer the shares. All instruments of transfer which are
     registered shall be retained by the Company or its transfer agent, but any
     instrument of transfer where the transfer is not registered shall be
     returned to the person depositing the same, together with the share
     certificate which accompanied the same


                                      -5-

     when tendered for registration. The transferor shall remain the holder of
     the share until the name of the transferee is entered on the register in
     respect of that share.

4.3  The signature of the registered owner of any shares, or of his duly
     authorized attorney, upon the form of transfer constitutes an authority to
     the Company to register the shares specified in the form of transfer in the
     name of the person named in that form as transferee or, if no person is so
     named, then in any name designated in writing by the person depositing the
     share certificate and the form of transfer with the Company or its agents.
     The Company or its transfer agent may require proof or guarantee of the
     signature of any transferor.

4.4  Neither the Company nor any director, officer or agent is bound to enquire
     into the title of the transferee of shares to be transferred, nor is any
     such person liable to the registered or any intermediate owner of the
     shares for registering the transfer.

4.5  The Company may keep its register of members either at its records office
     or at any office in the Province of British Columbia of a trust company
     registered under the Trust Company Act, and may keep, or cause to be kept
     within the Province by a trust company registered as aforesaid, one or more
     branch registers of members.

4.6  Whenever the Company is a reporting company, but not otherwise, it may
     cause one or more branch registers of members to be kept outside the
     Province of British Columbia.


                        PART 5 - TRANSMISSION OF SHARES


5.1  In the case of the death or bankruptcy of a member, his personal
     representative or trustee in bankruptcy shall be the only person recognized
     by the Company as having any title to or interest in the shares registered
     in the name of the deceased. Before recognizing any personal representative
     or trustee in bankruptcy the directors may require him to produce and
     deposit the documents required by the Company Act.

5.2  Notwithstanding anything otherwise provided in these Articles, if a person
     becomes entitled to a share as a result of an order of a Court of competent
     jurisdiction or pursuant to a statute, then, upon producing such evidence
     as the directors think sufficient that he is so entitled, such person may
     be registered as holder of the share.


                         PART 6 - BORROWING AND CAPITAL

6.1  Subject to any restriction which may from time to time be included in the
     memorandum of the Company or these Articles or contained in the Company Act
     or the terms, rights or restrictions of any shares or securities of the
     Company outstanding, the directors may at their discretion authorize the
     Company to borrow any sum of money and may raise or secure the repayment of
     such sum in such manner and upon such terms and conditions, in all
     respects, as they think fit, and in particular, and without limiting the
     generality of the foregoing, by the issue of bonds or debentures, or any
     mortgage or charge, whether specific or floating, or by granting any other
     security on the undertaking, or the whole or any part of the property, of
     the Company, both present and future.

6.2  The directors may make any debentures, bonds or other debt obligations
     issued by the Company, by their terms assignable free from any equities
     between the Company and the person to whom they may be issued or any other
     person who lawfully acquires the same by assignment, purchase, or
     otherwise, howsoever.

6.3  The directors may authorize the issue of any debentures, bonds or other
     debt obligations of the Company at a discount, premium or otherwise, and
     with special or other rights or privileges as to redemption, surrender,
     entitlement to interest or share of income, allotment of, or conversion
     into,


                                      -6-

     or exchange for shares, attendance at general meetings of the Company, and
     otherwise as the directors may determine at or before the time of issue,
     but no debenture shall be issued which the Company has not the power to
     reissue until the members by resolution determine such debenture shall be
     cancelled unless such debenture expressly provides by its terms that it
     shall not be reissued. The Company may cause one or more branch registers
     of its debenture holders to be kept.

6.4  The Company by ordinary resolution of the members and insofar as the
     Company Act shall permit, may alter its memorandum to increase its
     authorized capital by:

     (a)  creating shares with par value, or shares without par value, or both;

     (b)  increasing the number of shares with par value, or shares without par
          value, or both;

     (c)  increasing the par value of a class of shares with par value, if no
          shares of that class are issued; or

     (d)  creating shares of different classes with special rights or
          restrictions.

6.5  The Company may, by resolution of the directors and subject to the
     provisions of the Company Act and the specific provisions of any special
     rights or restrictions attached to any class or classes of its shares,
     purchase or otherwise acquire any of its shares if, at the time of the
     proposed purchase or acquisition the Company is not insolvent or likely to
     be rendered insolvent by such purchase or acquisition and if, where a
     proposed purchase of shares is not to be made through a stock exchange, the
     Company shall make its offer to purchase pro rata to every member who holds
     shares of the class or kind to be purchased unless the Company is
     purchasing shares from a dissenting member pursuant to the Company Act.

6.6  The Company may, by resolution of the directors and subject to the
     provisions of the Company Act and the specific provisions of any special
     rights or restrictions attached to any class or classes of its shares by
     the Memorandum or these Articles, redeem any of its issued shares that have
     a right of redemption attached thereto provided that at the time of such
     redemption the Company is not insolvent or likely to be rendered insolvent
     by such redemption and where the Company proposes to redeem some, but not
     all, of its shares of a particular class or kind, the directors shall have
     absolute discretion to determine in such manner as they deem proper which
     shares shall be redeemed, and, without limiting the generality of the
     foregoing, may redeem shares which have been purchased by the Company in
     priority to shares which are held by members.

6.7  The banking business of the Company, or any part thereof, shall be
     transacted with such bank, trust company or other firm or body corporate as
     the board may designate, appoint or authorize from time to time and all
     such banking business, or part thereof, shall be transacted on the
     Company's behalf by such one or more officers or other persons as the board
     may designate, direct or authorize from time to time and to the extent
     thereby provided.


                               PART 7 - MEETINGS

7.1  Meetings of the Company shall be held at such time and place, in accordance
     with the Company Act, as the directors appoint, and, unless otherwise
     specifically provided, the provisions of these Articles relating to
     meetings shall apply with necessary changes to a meeting of members holding
     a particular class of shares.

7.2  Every meeting, other than an annual general meeting or a class meeting,
     shall be called an extraordinary general meeting.


                                      -7-

7.3  The directors may, whenever they think fit, convene an extraordinary
     general meeting.

7.4  Notice of a meeting shall be given not less than 21 days and not more than
     50 days prior to the date of the meeting and shall specify the place, the
     day and the hour of meeting, and, in case of special business, the general
     nature of that business. The accidental omission to give notice of any
     meeting to, or the non-receipt of any notice by, any of the members
     entitled to receive notice, shall not invalidate any proceedings at that
     meeting.

7.5  If any special business includes presenting, considering, approving,
     ratifying or authorizing the execution of any document, then the portion of
     any notice relating to that document is sufficient if it states that a copy
     of the document or proposed document is or will be available for inspection
     by members at an office of the Company in the Province of British Columbia
     or at one or more designated places in the Province during business hours
     on any specified or unspecified business day or days prior to the date of
     the meeting, and at the meeting.

7.6  Meetings of members shall be held at the registered office of the Company
     or elsewhere in the municipality in which the registered office is situate
     or, if the board shall so determine, at some other place in Canada or, if
     all members entitled to vote at the meeting agree, at some place outside
     Canada, and a member who attends a meeting outside Canada is deemed to have
     so agreed except when he attends such meeting for the express purpose of
     objecting to the transaction of any business on the grounds that the
     meeting is not lawfully held.

7.7  The Company shall prepare a list of members entitled to receive notice of
     meetings, arranged in alphabetical order and showing the number of shares
     entitled to be voted at the meeting held by each member. The list shall be
     available for examination by any member during usual business hours at the
     registered office of the Company or at the place where the securities
     register is kept and at the place where the meeting is held.


                    PART 8 - PROCEEDINGS AT GENERAL MEETINGS

8.1  The following business at a general meeting shall be deemed to be special
     business:

     (a)  All business at an extraordinary general meeting;

     (b)  All business that is transacted at an annual general meeting, with the
          exception of the consideration of the financial statements and the
          report of the directors and auditors, the election of directors, the
          appointment of the auditors and such other business as, under these
          Articles or in accordance with the Company Act, ought to be transacted
          at an annual general meeting or is business which is brought under
          consideration by the report of the directors issued with the notice
          convening the meeting;

     and no special business shall be conducted at any meeting unless notice of
     that business has been given to the members in accordance with these
     Articles or members holding at least 75% of the shares entitled to be
     voted at that meeting are present and consent to the conduct of such
     business.

8.2  No business, other than the election of a chairman and the adjournment or
     termination of the meeting, shall be conducted at any meeting at any time
     when a quorum is not present. A quorum shall be two persons holding or
     representing by proxy not less than one-half of the outstanding shares of
     the Company which are entitled to be voted at the meeting, unless the
     Company has only one member, in which case the quorum shall be that member
     who may conduct the business of the Company by proceedings recorded in
     writing and signed by him. If at any time during a meeting there ceases to
     be a quorum present, any business then in progress shall be suspended
     until there is a quorum present or until the meeting is adjourned or
     terminated, as the case may be.


                                      -8-

8.3  If within 30 minutes from the time appointed for a meeting a quorum is not
     present, the meeting, if convened upon the requisition of members, shall be
     terminated. In any other case, it shall stand adjourned to the same day in
     the next week, at the same time and place, and if, at the adjourned
     meeting, a quorum is not present within half an hour from the time
     appointed for the meeting, the member or members present shall be a quorum.

8.4  Subject to Article 8.5, the chairman of the directors, if there is one,
     failing whom the president of the Company, failing whom one of the
     directors present chosen by the directors from among their number, shall
     preside as chairman of every meeting.

8.5  If at any general meeting there is no chairman or president or director
     present within 15 minutes after the time appointed for holding the meeting,
     or if the chairman or president and all the directors present are unwilling
     to act as chairman, the members present shall choose someone of their
     number to be chairman.

8.6  The chairman of a meeting may, with the consent of any meeting at which a
     quorum is present, and shall, if so directed by the meeting, adjourn the
     meeting from time to time and from place to place, but no business shall be
     transacted at any adjourned meeting other than the business left unfinished
     at the meeting from which the adjournment took place. When a meeting is
     adjourned for 30 days or more, notice of the adjourned meeting shall be
     given as in the case of the original meeting. Except as aforesaid, it is
     not necessary to give any notice of an adjournment or of the business to be
     transacted at an adjourned meeting.

8.7  No resolution proposed at a meeting need be seconded, and the chairman of
     any meeting is entitled to move or propose a resolution.

8.8  In case of an equality of votes either on a show of hands or on a poll, the
     chairman shall have a casting or second vote in addition to the vote or
     votes to which he may be entitled as a member, which vote or votes he is
     entitled to cast without vacating the chair.

8.9  In the case of any dispute as to the admission or rejection of a proxy or a
     vote, the chairman shall determine the same and his determination, made in
     good faith, is final and conclusive.

8.10 A member entitled to more than one vote need not, if he votes, use all his
     votes or cast all the votes he uses in the same way.

8.11 Subject to these Articles, if a poll is duly demanded it shall be taken in
     such manner as the chairman directs within seven days of the demand for the
     same. The result of the poll shall be deemed to be the resolution of the
     meeting at which the poll is demanded. A demand for a poll may be withdrawn
     at any time before it has been taken.

8.12 A poll demanded on a question of adjournment shall be taken at the meeting
     without adjournment.

8.13 The demand for a poll shall not, unless the chairman so rules, prevent the
     continuance of a meeting for the transaction of any business other than the
     question on which a poll has been demanded or questions which depend or
     bear upon that question.

8.14 Subject always to any contrary or specific provision of the Company Act, a
     resolution that has been submitted to all of the members who would have
     been entitled to vote thereon in person or by proxy at a meeting and that
     has been consented to in writing by such members holding not less than 75%
     of the shares of the Company shall be deemed to be an ordinary resolution
     passed at a meeting.


                                      -9-

8.15 Subject always to any contrary or specific provision of the Company Act, a
     resolution consented to in writing by every member of the Company who would
     have been entitled to vote thereon in person or by proxy at a meeting shall
     be deemed to be a special resolution passed at a meeting.

8.16 Subject always to the provisions of the Company Act, whenever the Company
     is not a reporting company, where all the members entitled to attend and
     vote at the annual general meeting of the Company consent in writing to all
     the business required to be transacted at the meeting, it is not necessary
     for the Company to hold that annual general meeting.

8.17 The only persons entitled to be present at a meeting of members shall be
     those entitled to vote thereat, the directors and the auditor of the
     Company and others who, although not entitled to vote, are entitled or
     required under any provision of the Company Act or the articles to be
     present at the meeting. Any other person may be admitted only on the
     invitation of the chairman of the meeting or with the consent of the
     meeting.


                           PART 9 - VOTES OF MEMBERS

9.1  Subject to any rights or restrictions for the time being attached to any
     class or classes of shares, on a show of hands every member over the age of
     eighteen years present in person or by proxy has one vote, and on a poll
     every such member present in person or by proxy has one vote for each share
     he holds on the record date except that no member which is a corporation
     which is a subsidiary of the Company shall be entitled to vote its shares
     of the Company, and the Company itself shall not vote in respect of any
     share of the Company that it has redeemed purchased, or otherwise acquired.

9.2  Any person who is not registered as a member but who is entitled to vote at
     any meeting in respect of a share, may vote the share in the same manner as
     if he were a member, but, unless the directors have previously admitted his
     right to vote at that meeting in respect of the share, if so required by
     any director he shall satisfy the directors of his right to vote the share
     before the time for holding the meeting, or adjourned meeting, as the case
     may be, at which he proposes to vote.

9.3  Where there are joint members registered in respect of any share, any one
     of the joint members may vote at any meeting, either personally or by
     proxy, in respect of the share as if he were solely entitled to it. If more
     than one of the joint members is present at any meeting, personally or by
     proxy, the joint member present whose name stands first on the register in
     respect of the share shall alone be entitled to vote in respect of that
     share. Several executors or administrators of a deceased member in whose
     sole name any share stands shall, for the purposes of this Article, be
     deemed joint members.

9.4  Subject to the provisions of the Company Act, a corporation which is a
     member and is not a subsidiary of the Company may vote by up to two duly
     authorized representatives, who are entitled to speak and vote, either in
     person or by proxy, and in all other respects exercise the rights of a
     member and those representatives shall be reckoned as a member for all
     purposes in connection with any meeting of the Company.

9.5  A member for whom a committee has been duly appointed may vote, whether on
     a show of hands or on a poll, by his committee and that committee may
     appoint a proxyholder.

9.6  Unless the directors otherwise determine, the instrument appointing a
     proxyholder and the power of attorney or other authority, if any, under
     which it is signed, or a notarially certified copy thereof, shall be
     deposited at a place specified for that purpose in the notice convening the
     meeting, not less than 48 hours before the time for holding the meeting at
     which the proxyholder proposes to vote, or, if no such place is specified,
     then it shall be deposited with the chairman of the meeting prior to the
     commencement of the meeting.


                                      -10-

9.7  A vote given in accordance with the terms of an instrument of proxy is
     valid notwithstanding the previous death or incapability of the member, or
     revocation of the proxy, or of the authority under which the proxy was
     executed, or the transfer of the share in respect of which the proxy is
     given, if, but only if, no prior notice in writing of the death,
     incapability, revocation or transfer has been received at the registered
     office of the Company or by the chairmen of the meeting or adjourned
     meeting before the vote is given.

9.8  An instrument appointing a proxyholder, whether for a specified meeting or
     otherwise, shall be, subject to the requirements of the Company Act, in the
     form approved by the directors.

9.9  A proxy or an instrument appointing a duly authorized representative of a
     corporation shall be in writing, under the hand of the appointor or of his
     attorney duly authorized in writing, or, if such appointor is a
     corporation, either under its seal or under the hand of an officer or
     attorney duly authorized.

9.10 Any person may act as a proxyholder whether or not he is entitled on his
     own behalf to be present and to vote at the meeting at which he acts as
     proxyholder.

9.11 The directors may fix in advance a date, preceding the date of any meeting
     of members by not more than 50 days and not less than 21 days, as a record
     for the determination of the members entitled to notice of the meeting,
     provided that notice of any such record date is given, not less than 14
     days before such record date, by newspaper advertisement in the place where
     the registered office of the Company is situate. If no record date is so
     fixed, the record date for the determination of the members entitled to
     receive notice of the meeting shall be at the close of business on the day
     immediately preceding the day on which the notice is given or, if no notice
     is given, the day on which the meeting is held.


                              PART 10 - DIRECTORS

10.1 The directors named in the Instrument of Continuation at the coming into
     force of these Articles, shall be the directors of the Company unless and
     until such person:

     (a)  dies;

     (b)  resigns in writing;

     (c)  is no longer qualified in accordance with these Articles or the
          Company Act; or

     (d)  is removed from office by ordinary resolution of the members.

10.2 The management of the business of the Company shall be vested in the
     directors and the directors may exercise all such powers and do all such
     acts and things as the Company may exercise and do which are not by these
     Articles or by the Company Act or otherwise lawfully directed or required
     to be exercised or done by the Company in general meeting, but subject,
     nevertheless, to the provisions of all laws affecting the Company and of
     these Articles and to any rules, not being inconsistent with these Articles
     which are made from time to time by the Company in general meeting,
     provided that no rule made by the Company in general meeting shall
     invalidate any prior act of the directors that would have been valid if
     that rule had not been made.

10.3 The number of directors shall be at least one as long as the Company is not
     a reporting company, and shall be at least three whenever the Company is a
     reporting company, and no more than 25. Subject to the foregoing, the
     number of directors may be determined from time to time by resolution of
     the members, and provided that the number of directors holding office shall
     not fall below the minimum numbers above mentioned, the number of directors
     shall be automatically


                                      -11-

     reduced upon the death, resignation, removal or disqualification of any
     director and automatically increased upon the appointment of any additional
     director or directors in accordance with these Articles.

10.4 A director is not required to hold a share of the Company as qualification
     to be a director, but in order to be qualified he must not be:

     (a)  under the age of 18 years; or,

     (b)  found to be incapable of managing his own affairs by reason of mental
          infirmity; or,

     (c)  a corporation; or,

     (d)  an undischarged bankrupt; or,

     (e)  unless the Supreme Court of British Columbia orders otherwise,
          convicted within or without the Province of British Columbia of an
          offence

          (i)  in connection with the promotion, formation, or management of a
               corporation; or,

          (ii) involving fraud,

          unless five years have elapsed since the expiration of the period
          fixed for suspension of the passing of sentence without sentencing, or
          since a fine was imposed, or the term of imprisonment and probation
          imposed, if any, was concluded, whichever is the latest, but the
          disability imposed by this clause ceases upon a pardon being granted
          under the Criminal Records Act (Canada);

     and every director must not be subject to any other disqualifications as to
     office according to the Company Act, provided always that no person who is
     not ordinarily resident in Canada shall be appointed a director of the
     Company if, upon his appointment, the majority of the directors of the
     Company would not be persons ordinarily resident in Canada.

10.5 In the event of the death, resignation, removal or disqualification of a
     director and his consequent vacating of office in accordance with these
     Articles or the Company Act in circumstances in which the majority of the
     directors of the Company would thereafter not be persons ordinarily
     resident in Canada, then the last appointed director who is not ordinarily
     resident in Canada shall, ipso facto, be disqualified from office and be no
     longer a director of the Company. In the event there are on the happening
     of such an event two or more persons who are not ordinarily resident in
     Canada who were last appointed and appointed at the same time, then the
     Secretary shall determine by lot which of the two or more so last appointed
     shall have ceased to hold office by reason of this paragraph. Subject to
     the foregoing, if a casual vacancy should occur in the board, the remaining
     directors if constituting a quorum may appoint a qualified person to fill
     the vacancy for the remainder of the term. Where a vacancy or vacancies
     exist on the board, the remaining directors may exercise all of the powers
     of the board so long as a quorum remains in office.

10.6 If the Company removes any director by ordinary resolution, it may by
     ordinary resolution, appoint another person in his stead.

10.7 Any person not being a member of the Company who becomes a director shall
     be deemed to have agreed to be bound by the provisions of the Articles to
     the same extent as if he were a member of the Company.


                                      -12-

10.8  Subject to the provisions of any ordinary resolution, the remuneration of
      the directors as such may from time to time be determined by the directors
      themselves, and such remuneration may be in addition to any salary or
      other remuneration paid to any officer or employee of the Company as such,
      who is also a director. The directors shall be repaid such reasonable
      expenses as they may incur in and about the business of the Company, and
      if any director shall perform any professional or other services for the
      Company that are outside the ordinary duties of a director, or shall
      otherwise be specifically occupied in or about the Company's business, he
      may be paid a special remuneration to be fixed by the directors in
      addition to any other remuneration that he may be entitled to receive and
      the same shall be charged as part of the ordinary working expenses. Unless
      otherwise determined by ordinary resolution, the directors on behalf of
      the Company may pay a gratuity or pension or allowance on retirement to
      any person who has held any office of employment with the Company or to
      his spouse or dependants and may make contributions under any plan or to
      any fund and pay premiums for the purchase or provision of any such
      gratuity, benefit, pension or allowance.

10.9  The directors may from time to time and at any time by power of attorney
      appoint any company, firm or person or body of persons to be the attorney
      or attorneys of the Company for such purposes and with such powers,
      authorities and discretion, not exceeding those vested in or exercisable
      by the directors under these Articles, and for such period, and subject to
      such conditions, as they may think fit.

10.10 A director who is in any way directly or indirectly interested in a
      proposed contract or transaction with the Company shall disclose the
      nature and extent of his interest at a meeting of the directors in
      accordance with the provisions of the Company Act. A director shall not
      vote in respect of any contract or transaction with the Company in which
      he is interested, and if he shall do so his vote shall not be counted, but
      he may be counted in the quorum present at the meeting at which such vote
      is taken.

10.11 A director may hold any office or place of profit under the Company other
      than auditor, for such period, and on such terms as to remuneration or
      otherwise, as the directors may determine. Subject to compliance with the
      Company Act, no director shall be disqualified by his office from
      contracting with the Company either with regard to his tenure of any
      office or place of profit or as vendor, purchaser or otherwise.

10.12 Any director may act by himself or his firm in any professional capacity
      for the Company except as auditor, and he or his firm shall be entitled to
      remuneration for professional services as if he were not a director.

10.13 At each annual general meeting of the Company all the directors shall
      retire from office, but are eligible for re-election and the members shall
      by ordinary resolution elect a board of directors consisting of the number
      of directors so retiring or determined by resolution or recommendation of
      the directors. If in any calendar year the Company does not hold an annual
      general meeting the directors then in office shall be deemed to have been
      elected as directors on the last day on which the meeting should have been
      held pursuant to the Company Act, and the directors so elected may hold
      office until other directors are appointed or elected or until the day on
      which the next annual general meeting is held.


                           PART 11 - INDEMNIFICATION

11.1  The Company shall indemnify any director, officer, employee or agent of
      the Company who was or is a party or is threatened to be made a party to
      any threatened, pending or completed action or proceeding and whether
      civil, criminal or administrative, by reason of the fact that he is or was
      a director, officer, employee, or agent of the Company or any act or thing
      occurring at a time when he is or was serving at the request of the
      Company as a director, officer, employee or agent of another corporation,
      partnership, joint venture, trust or other enterprise, against all costs,
      charges and expenses, including legal fees and any amount paid to settle
      the action or


                                      -13-

      proceeding or satisfy a judgment, if he acted honestly and in good faith
      with a view to the best interests of the corporation or other legal entity
      or enterprise as aforesaid of which he is or was a director, officer,
      employee or agent, as the case may be, and exercised the care, diligence
      and skill of a reasonably prudent person, and with respect to any criminal
      or administrative action or proceeding, he had reasonable ground for
      believing that his conduct was lawful; provided that no indemnification of
      a director or former director of the Company, or director or former
      director of a corporation in which the Company is or was a shareholder,
      shall be made except to the extent approved by the Court pursuant to the
      Company Act or any other statute. The determination of any action, suit or
      proceeding by judgment, order, settlement, conviction or otherwise shall
      not, of itself, create a presumption that the person did not act honestly
      and in good faith and in the best interests of the Company and did not
      exercise the care, diligence and skill of a reasonably prudent person and,
      with respect to any criminal action or proceeding, did not have reasonable
      grounds to believe that his conduct was lawful.

11.2  The Company shall indemnify any person in respect of any loss, damage,
      costs or expenses whatsoever incurred by him while acting as an officer,
      employee or agent for the Company unless such loss, damage, costs or
      expenses shall arise out of failure to comply with instructions, wilful
      act or default or fraud by such person, in any of which events the Company
      shall only indemnify such person if the directors, in their absolute
      discretion, so decide or the Company by ordinary resolution shall so
      direct.

11.3  The indemnification provided by this Article shall not be deemed exclusive
      of any other rights to which those seeking indemnification may be entitled
      under any other Article, or any valid and lawful agreement, vote of
      members or disinterested directors or otherwise, both as to action in his
      official capacity and as to action in another capacity while holding such
      office, and shall continue as to a person who has ceased to be a director,
      officer, employee or agent and shall entire to the benefit of the heirs,
      executors and administrators of such person The indemnification provided
      by this Article shall not be exclusive of any powers, rights, agreements
      or undertakings which may be legally permissible or authorized by or under
      any applicable law. Notwithstanding any other provisions set forth in this
      Article, the indemnification authorized by this Article shall be
      applicable only to the extent that any such indemnification shall not
      duplicate indemnity or reimbursement which that person has received or
      shall receive otherwise than under this Part.

11.4  The directors are authorized from time to time to cause the Company to
      give indemnities to any director, officer, employee, agent or other person
      who has undertaken or is about to undertake any liability on behalf of the
      Company or any corporation controlled by it.

11.5  Subject to the Company Act, no director or officer or employee for the
      time being of the Company shall be liable for the acts, receipts, neglects
      or defaults of any other director or officer or employee, or for joining
      in any receipt or act for conformity, or for any loss, damage or expense
      happening to the Company through the insufficiency or deficiency of title
      to any property acquired by order of the Board for the Company, or for the
      insufficiency or deficiency of any security in or upon which any of the
      moneys of or belonging to the Company shall be invested or for any loss or
      damages arising from the bankruptcy, insolvency, or tortious act of any
      person, firm or corporation with whom or which any moneys, securities or
      effects shall be lodged or deposited or for any loss occasioned by any
      error of judgment or oversight on his part or for any other loss, damage
      or misfortune whatever which may happen in the execution of the duties of
      his respective office or trust or in relation thereto unless the same
      shall happen by or through his own wilful act or default, negligence,
      breach of trust or breach of duty.

11.6  Directors may rely upon the accuracy of any statement of fact represented
      by an officer of the Company to be correct or upon statements in a written
      report of the auditor of the Company and shall not be responsible or held
      liable for any loss or damage resulting from the paying of any dividends
      or otherwise acting in good faith upon any such statement.


                                      -14-

11.7  The directors may cause the Company to purchase and maintain insurance for
      the benefit of any person who is or was a director, officer, employee or
      agent of the Company or is or was serving at the request of the Company as
      a director, officer, employee or agent of another corporation,
      partnership, joint venture, trust or other enterprise against any
      liability incurred by him as a director, officer, employee or agent.


                      PART 12 - PROCEEDINGS OF DIRECTORS.

12.1  Notice of the time and place of each meeting of the board shall be given
      to each director not less than 48 hours before the time when the meeting
      is to be held. A notice of meeting of directors need not specify the
      purpose of or business to be transacted at the meeting except where the
      Company Act requires such purpose or business to be specified. The
      directors, when there is more than one, may meet together at such places
      as they think fit for the dispatch of business, adjourn and otherwise
      regulate their meetings and proceedings as they see fit.

12.2  The quorum shall be a majority of the directors then in office, and when
      an even number of directors are holding office, shall be one more than
      half of their number.

12.3  Unless and until the directors shall elect one of their number to be
      chairman of the board of directors, the president of the Company shall be
      chairman of all meetings of the directors; but if at any meeting a
      chairman elected by the directors or the president is not present within
      30 minutes after the time appointed for holding the meeting, the directors
      present may choose someone of their number to be chairman at that meeting.

12.4  Any director may waive notice of any meeting of directors. Accidental
      omission to give notice of a meeting of directors to, or non-receipt of
      notice by, any director, shall not invalidate the proceedings of any
      meeting of the directors.

12.5  Provided a quorum of directors is present, each newly elected board may
      without notice hold its first meeting following the meeting of members at
      which such board is elected. Notice of an adjourned meeting of the board
      is not required if the time and place of the adjourned meeting is
      announced at the original meeting.

12.6  Except as provided in the Company Act, the Directors may participate in a
      meeting of the Directors by means of telephone or other communications
      facilities that permit all Directors participating in the meeting to
      communicate with each other. A meeting so held in accordance with this
      Article shall be deemed to be an actual meeting of the board and any
      resolution passed at such meeting shall be as valid and effectual as if it
      had been passed at a meeting where the Directors are physically present. A
      Director participating in a meeting in accordance with this Article shall
      be deemed to be present at the meeting and to have so agreed and shall be
      counted in the quorum therefore and be entitled to participate in and vote
      thereat.

12.7  The directors, or any committee of directors, may take any action required
      or permitted to be taken by them and may exercise all or any of the
      authorities, powers and discretion for the time being vested in or
      exercisable by them by resolution either passed at a meeting at which a
      quorum is present and at which a majority of the directors present are
      resident Canadians or authorized by resolution consented to in writing
      signed by all the directors in accordance with the Company Act. The board
      may transact business at a meeting of directors where a majority of
      resident Canadian directors is not present if a resident Canadian director
      who is unable to be present approves in writing or by telephone or other
      communications facilities the business transacted at the meeting, and a
      majority of Canadian resident directors would have been present had that
      director been present at the meeting.

12.8  The directors may delegate any, but not all, of their powers to committees
      consisting of such director or directors as they think fit. Any committee
      so formed in the exercise of the powers so


                                      -15-

      delegated shall conform to any rules that may from time to time be imposed
      on it by the directors, and shall report every act or thing done in
      exercise of those powers to the first meeting of the directors held after
      it has been done.

12.9  A committee of more than one director may elect a chairman of its meetings
      and if no chairman is elected, or if at any meeting the chairman is not
      present within 30 minutes after the time appointed for holding the
      meeting, the directors present who are members of the committee may choose
      one of their number to be chairman of the meeting.

12.10 The member or members of a committee may govern their procedure as they
      think proper, subject to any rules imposed by the directors. Each
      committee shall have the power to fix its quorum at not less than a
      majority of its members. Questions arising shall be determined by the
      member, if there be only one, or by a majority of votes of the members
      present, but in case of an equality of votes the chairman of a committee
      shall not have a second or casting vote.

12.11 Any director of the Company who may be absent from the Province of British
      Columbia may file at the registered office of the Company by letter or
      facsimile a waiver of notice of any meeting of the directors and may, at
      any time and by one of the means mentioned aforesaid, withdraw the waiver,
      but until the waiver is withdrawn, no notice of meetings of directors need
      be sent to that director, and any and all meetings of the directors of the
      Company held after receipt of such waiver and held prior to its withdrawal
      shall, provided a quorum of the directors is present, be valid and
      effective without notice of such meeting given to that director.

12.12 Questions arising at any meeting of the directors shall be decided by a
      majority of votes. In case of an equality of votes, the chairman shall
      have a second or casting vote.

12.13 No resolution proposed at a meeting of directors need be seconded, and the
      chairman of any meeting is entitled to move or propose and vote upon a
      resolution of the directors.

12.14 All acts done by any meeting of the directors or by a committee of
      directors or by any person acting as a director shall, notwithstanding
      that it shall be afterwards discovered that there was some defect in the
      appointment of any such director or person acting as aforesaid, or that
      they or any of them were disqualified be as valid as if every such person
      had been duly appointed and was qualified to be a director.


                               PART 13 - OFFICERS

13.1  The Company shall have a president and a secretary whom the directors
      shall appoint. The President must be a director of the Company. Except
      when the Company has only one member, the President and Secretary shall be
      different persons. Subject to the foregoing, the board may from time to
      time appoint such other officers as the board may determine.

13.2  All appointments of officers shall be made at such remuneration, whether
      by way of salary, fee, commission, participation in profits, or otherwise,
      as the directors think fit, and every appointment of an officer by the
      directors shall be in force until revoked by the directors or until the
      death or resignation in writing of the officer unless otherwise provided
      in the resolution of appointment.

13.3  Every officer of the Company who holds any office or possesses any
      property whereby, whether directly or indirectly, duties or interests
      might be created in conflict with his duties or interests as an officer of
      the Company shall, in writing, disclose to the President the fact and the
      nature, character and extent of the conflict.


                                      -16-

                       PART 14 - EXECUTION OF INSTRUMENTS

14.1  The Secretary or any other officer or any director may sign certificates
      and similar instruments (other than share certificates) on the Company's
      behalf with respect to any factual matters relating to the Company's
      business affairs, including certificates verifying copies of the articles,
      by-laws, resolutions and minutes of meetings of the Company. Subject to
      the foregoing, deeds, transfers, assignments, contracts, obligations,
      certificates and other instruments shall be signed on behalf of the
      Company by two persons, one of whom holds the office of Chairman of the
      Board, President, Managing Director, Vice-President or director and the
      other of whom holds one of the said offices or the office of Secretary,
      Treasurer, Assistant Secretary or Assistant Treasurer or any other office
      created by by-law or by resolution of the board. In addition, the board
      may from time to time direct the manner in which and the person or persons
      by whom any particular instrument or class of instruments may or shall be
      signed.

14.2  The directors may, but shall not be required to, provide a common seal for
      the Company. They shall have power from time to time to destroy the same
      or substitute a new seal in place of the seal destroyed or to cause the
      affairs of the Company to be conducted without a common seal. In the event
      a seal is provided, then unless otherwise provided by the directors, the
      same may be affixed to any document by the signing officers designated in
      Article 14.1.

14.3  Subject to the provisions of the Company Act, the directors may provide
      for use in any other province, state, territory or country an official
      seal, which shall be a facsimile of the common seal of the Company, with
      the addition on its face of the name of the province, state, territory or
      country where it is to be used.

14.4  The signature of any officer of the Company may be printed, lithographed,
      engraved or otherwise mechanically reproduced upon all instruments
      executed or issued by the Company or any officer thereof; and, subject to
      the Company Act, any instrument on which the signature of any such person
      is so reproduced, shall be deemed to have been manually signed by such
      person whose signature is so reproduced and shall be as valid to all
      intents and purposes as if such instrument had been signed manually, and
      notwithstanding that the person whose signature is so reproduced may have
      ceased to hold office at the date of the delivery or issue of such
      instrument. The term "instrument" as used in this Article shall include
      all paper and electronic writings.


                              PART 15 - DIVIDENDS

15.1  The directors may declare dividends and fix the date of record therefore
      and the date for payment thereof, provided that the record date may
      precede the payment date by not more than 50 days and notice of such
      record date is given not less than 14 days before such record date by
      advertisement in a newspaper published or distributed in the place where
      the Company has its registered office. If no record date is fixed then the
      record date shall be the close of business on the day on which the
      resolution relating to such dividend is passed by the board.

15.2  Subject to the terms of shares with special rights or restrictions, all
      dividends shall be declared according to the number of shares held.

15.3  Dividends may only be payable out of the profits of the Company. No
      dividend shall bear interest against the Company. A transfer of a share
      shall not pass the right to any dividend thereon before the registration
      of the transfer in the register.

15.4  A resolution declaring a dividend may direct payment of the dividend
      wholly or partly by the distribution of specific assets or of paid-up
      shares, bonds, debentures or other debt obligations of the Company, or in
      any one or more of those ways, and, where any difficulty arises in regard
      to the distribution, the directors may settle the same as they think
      expedient, and in particular may fix the value for distribution of
      specific assets, and may determine that cash payments shall be




                                      -17-

      made to a member upon the basis of the value so fixed in place of
      fractional shares, bonds, debentures or other debt obligations in order to
      adjust the rights of all parties, and may vest any of those specific
      assets in trustees upon such trusts for the persons entitled as may seem
      expedient to the directors.

15.5  Any dividend or other moneys payable in cash in respect of a share may be
      paid by cheque sent through the post to the member in a prepaid letter,
      envelope or wrapper addressed to the member at his registered address, or
      in the case of joint members, to the registered address of the joint
      member who is the first named on the register, or to such person and to
      such address as the member or joint members, as the case may be, in
      writing direct. Any one of two or more joint members may give effectual
      receipts for any dividend or other moneys payable or assets distributable
      in respect of a share held by them.

15.6  No notice of the declaration of a dividend need be given to any member.

15.7  The directors may, before declaring any dividend, set aside out of the
      profits of the Company such sums as they think proper as a reserve or
      reserves which shall, at the discretion of the directors, be applicable
      for meeting contingencies, or for equalizing dividends, or for any other
      purpose to which the profits of the Company may be properly applied, and
      pending that application may, at the like discretion, either be employed
      in the business of the Company or be invested in such investments, as the
      directors may from time to time think fit, including shares of the Company
      purchased or acquired in accordance with these Articles.

15.8  The directors may capitalize any undistributed surplus on hand of the
      Company and may from time to time issue as fully paid and non-assessable
      any unissued shares or any bonds, debentures or other debt obligations of
      the Company as a dividend representing such undistributed surplus on hand
      or any part thereof.

15.9  Should any dividend result in any shareholder being entitled to a
      fractional share, the directors shall have the right to pay such
      shareholders the cash equivalent of such fractional part, and shall have
      the further right to carry out such distribution and to adjust the rights
      of the shareholders with respect thereto on as practical and equitable a
      basis as possible.

15.10 Any dividend unclaimed after a period of six years from the date on which
      the same has been declared to be payable shall be forfeited and shall
      revert to the Company.


                               PART 16 - ACCOUNTS

16.1  The directors shall cause records and books of accounts to be kept as
      necessary to record properly the financial affairs and conditions of the
      Company and to comply with the provisions of the Company Act and all
      statutes applicable to the Company.

16.2  The fiscal period of the Company shall terminate on such day in each year
      as the Board of Directors may from time to time, by resolution, determine.


                               PART 17 - NOTICES

17.1  A notice may be given to any member or director, either by personal
      service or by sending it by post to him in a letter, envelope or wrapper
      or by facsimile addressed to the member or director at his registered
      address or in any manner approved by the directors and not prohibited by
      the Company Act.

17.2  A notice may be given by the Company to joint members in respect of a
      share registered in their names by giving the notice to the joint member
      first named in the register of members in respect of that share.



                                      -18-

17.3  A notice may be given by the Company to the persons entitled to a share in
      consequence of the death or bankruptcy of a member by sending it through
      the post in a prepaid letter, envelope or wrapper addressed to them by
      name, or by the title of representatives of the deceased or trustee of the
      bankrupt, or by any like description, at the address, if any, supplied for
      the purpose by the persons claiming to be so entitled, or, until that
      address has been so supplied, by giving the notice in any manner in which
      the same might have been given if the death or bankruptcy had not
      occurred.

17.4  Any notice or document sent by post to, or left at, the registered address
      of any member, shall, notwithstanding that member is then deceased, and
      whether or not the Company has notice of his death, be deemed to have been
      duly served in respect of any registered shares, whether held solely or
      jointly with other persons by that deceased member, until some other
      person is registered in his stead as the member or joint member in respect
      of those shares, and that service shall for all purposes of these Articles
      be deemed a sufficient service of such notice or document on his personal
      representatives and all persons, if any, jointly interested with him in
      those shares.

17.5  Any notice sent by post shall be deemed to have been served on the second
      day following that on which the letter, envelope or wrapper containing the
      same is posted exclusive of any day upon which the mail is not regularly
      delivered or handled in either the place of posting or the place of
      delivery, and in proving service it is sufficient to prove that the
      letter, envelope or wrapper containing the notice was properly addressed
      and put in a Canadian government post office, postage prepaid, subject
      always to it being proved by the person to whom the notice was addressed
      that the mail was not regularly delivered or handled as aforesaid on or
      between the day of posting and the day of delivery.

17.6  Notice of every general meeting shall be given in the manner hereinbefore
      authorized to:

      (a)   every member holding a share or shares carrying the right to vote at
            such meetings on the record date or, if no record date was
            established by the directors, on the date of personal service or
            mailing;

      (b)   every person upon whom the ownership of a share has devolved by
            reason of his being a legal personal representative or a trustee in
            bankruptcy of a member where the member, but for his death or
            bankruptcy, would be entitled to receive notice of the meeting; and

      (c)   the auditor of the Company.

      Subject to any provisions in any instrument of the Company or in the
      special rights or restrictions attached to any shares, no other person is
      entitled to receive notice of general meetings.


                                 PART 18 - FEES

18.1  The Company may charge the following fee to issue a new certificate in
      exchange for an existing certificate or a defaced or worn out certificate
      or to replace a lost or destroyed certificate:

      Per new certificate: $1.00


                   PART 19 - TRANSFER OF SHARES. RESTRICTIONS

19.1  A share or shares in the Company may be transferred by an instrument of
      transfer and in accordance with these Articles by any member, or the
      personal representative of any deceased member or the trustee in
      bankruptcy of any bankrupt member or by the liquidator of any member which
      is a corporation, only with the approval of a resolution of the directors.



                                      -19-

19.2  Notwithstanding anything otherwise provided in these Articles, the
      directors may, in their absolute discretion, refuse to allow and decline
      to register any transfer of shares to any person, even if the foregoing
      conditions and other provisions of these Articles are complied with, and
      the directors shall not be bound or required to disclose their reasons for
      any such refusal to anyone.

19.3  The number of members of the Company shall be limited to 50, not including
      persons who are in the employment of the Company and persons who, having
      been formerly in the employment of the Company were, while in that
      employment and have continued after the termination of that employment to
      be, shareholders of the Company.

19.4  Any invitation to the public to subscribe for securities of the Company is
      prohibited.


                   PART 20 - SPECIAL RIGHTS AND RESTRICTIONS

CLASS A COMMON SHARES

20.1  The holders of the Class A Common Shares shall be entitled to one vote for
      each such share so held at all meetings of members.

20.2  Subject the rights of the holders of any Class B Preferred Shares
      established by series, the directors shall be at liberty in their absolute
      discretion to declare dividends on any one or more class or classes of the
      Class A Common Shares or the Class B Preferred Shares to the exclusion of
      the other.

20.3  Subject to the rights of holders of any Class B Preferred Shares
      established by series, in the event of the liquidation, dissolution or
      wind-up of the Company, whether voluntary or involuntary, the holders of
      the Class A Common Shares shall be entitled to participate on a pro rata
      basis in the distribution of the remaining assets of the Company.

CLASS B PREFERRED SHARES

20.4  Class B Preferred Shares may be issued by the directors in one or more
      series, and the directors may, from time to time, by resolution passed:

      (a)   alter the Memorandum of the Company to fix the number of shares in,
            and to determine the designation of the shares of, each series; and

      (b)   alter the Memorandum or the Articles of the Company to create,
            define and attach special rights and restrictions to the shares of
            each series, subject to the special rights and restrictions attached
            to the shares of the Class, including without in any way limiting or
            restricting the generality of the foregoing, the following:

            (i)   the rate, amount or method of calculation of dividends, if
                  any, and whether the same are subject to adjustments;

            (ii)  whether such dividends are cumulative, partly cumulative or
                  non-cumulative;

            (iii) the dates, manner and currency of payments of dividends and
                  the dates from which dividends accrue or become payable;

            (iv)  if redeemable or purchasable, the redemption or purchase
                  prices and the terms and conditions of redemption or purchase,
                  with or without provision for sinking or similar funds;

            (v)   any conversion, exchange or reclassification rights; and



                                      -20-

            (vi)  any other rights, privileges, restrictions and conditions not
                  inconsistent with these provisions.

20.5  The Class B Preferred Shares of each series shall, with respect to the
      payment of dividends and the distribution of assets in the event of the
      liquidation, dissolution or winding-up of the Company, whether voluntary
      or involuntary, or any other distribution of the assets of the Company
      among its members for the purpose of winding-up its affairs, rank on a
      parity with the Class B Preferred Shares of every other series and be
      entitled to a preference over the Class A Common Shares and any other
      class ranking junior to the Class B Preferred Shares. The Class B
      Preferred Shares of any series shall also be entitled to such other
      preferences, not inconsistent with these provisions, over the Class A
      Common Shares and the shares of any other class ranking junior to the
      Class B Preferred Shares, as may be fixed in accordance with Article 20.4.

20.6  The approval of the holders of Class B Preferred Shares as a class, as to
      any matters referred to in these provisions or required by law may be
      given as specified below:

      (a)   any approval given by the holders of the Class B Preferred Shares
            shall be deemed to have been sufficiently given if it shall have
            been given in writing by the holders of all of the outstanding Class
            B Preferred Shares or by a resolution passed at a meeting of holders
            of Class B Preferred Shares duly called and held for such purpose
            upon not less than 21 days' notice at which the holders of at least
            a majority of the outstanding Class B Preferred Shares are present
            or are represented by proxy and carried by the affirmative vote of
            not less than 75% of the votes cast at such meeting. If at any such
            meeting the holders of a majority of the outstanding Class B
            Preferred Shares are not present or represented by proxy within
            one-half hour after the time appointed for such meeting, then the
            meeting shall be adjourned to such date not less than 15 days
            thereafter and to such time and place as may be designated by the
            chairman of the meeting and not less than ten days' written notice
            shall be given of such adjourned meeting but it shall not be
            necessary in such notice to specify the purpose for which the
            meeting was originally called. At such adjournment meeting the
            holders of Class B Preferred Shares present or represented by proxy
            shall form a quorum and may transact the business for which the
            meeting was originally called and a resolution passed thereat by the
            affirmative vote of not less than 75% of the votes cast at such
            meeting shall constitute the approval of the holders of the Class B
            Preferred Shares; and

      (b)   on every poll taken at any such meeting each holder of Class B
            Preferred Shares shall be entitled to one vote in respect of each
            Class B Preferred Share held. Subject to the foregoing, the
            formalities to be observed with respect to the giving or waiving of
            notice of any such meeting and the conduct thereof shall be those
            from time to time prescribed in the Company Act and the Articles of
            the Company with respect to meetings of shareholders.

20.7  Except as otherwise provided in the Company Act or these provisions, the
      holders of Class B Preferred Shares shall not, as such, be entitled to
      receive notice of, or attend or vote at, any meeting of the members of the
      Company.



LETTERS PATENT
INCORPORATING
BOWES PUBLISHERS
LIMITED (As a
Private Company)

- ---

DATED 25th September, 1950

- ---

RECORDED 13th October, 1950

[signature]
For Deputy Registrar General
of Canada

                                     [logo]

                                     Canada

By the Honourable FREDERICK GORDON BRADLEY Secretary of State of Canada To all
whom these presents shall come, or whom the same may in anywise concern,
GREETING:

Whereas, in and by Part I of The Companies Act, 1934, it is, amongst other
things, in effect enacted that the Secretary of State of Canada may, by Letters
Patent, under his Seal of Office, grant a Charter to any number of persons, not
less than three, who having complied with the requirements of the said Act,
apply therefor, constituting such persons, and others who thereafter become
Shareholders of the Company thereby created, a Body Corporate and Politic for
any of the purposes or objects to which the Legislative Authority of the
Parliament of Canada extends, except the construction and working of railways
within Canada or of telegraph or telephone lines within Canada, the business of
insurance within the meaning of The Canadian and British Insurance Companies
Act, the business of a trust company within the meaning of the Trust Companies
Act, the business of a loan company within the meaning of the Loan Companies
Act, and the business of banking and the issue of paper money, upon the
applicants therefor establishing to the satisfaction of the Secretary of State,
due compliance with the several conditions and terms in and by the said Act set
forth and thereby made conditions precedent to the granting of such Charter.




And Whereas, GEORGE YOUNG CLEMENT and JOHN WESLEY BURGESS Solicitors, and JANET
OLIVE CLEMENT, Housewife, all of the Town of Wallasburg, in the Province of
Ontario,

have made application for a Charter under the said Act, constituting them and
such others as may become shareholders in the Company thereby created, a Body
Corporate and Politic, under the name of

                           BOWES PUBLISHERS LIMITED

for the purposes hereinafter mentioned, and have satisfactorily established the
sufficiency of all proceedings required by the said Act, to be taken, and the
truth and sufficiency of all facts required to be established previous to the
granting of such Letters Patent, and have filed in the Department of the
Secretary of State a duplicate of the Memorandum of Agreement executed by the
said applicants in conformity with the provisions of the said Act.

Now Know Ye, that I, the said FREDERICK GORDON BRADLEY Secretary of State of
Canada, under the authority of the hereinbefore in part recited Act do, by these
Letters Patent, constitute the said GEORGE YOUNG CLEMENT, JOHN WESLEY BURGESS
AND JANET OLIVE CLEMENT and all others who may become shareholders in the said
company, a Body Corporate and Politic, by the name of BOWES PUBLISHERS LIMITED
with all the rights and powers given by the said Act, and for the following
purposes and objects, namely - (a) To acquire, print, publish, conduct and
circulate or otherwise deal with any newspaper or newspapers or other
publications and generally to carry on the business of a newspaper proprietors
and general printers and publishers, stationers, lithographers, engravers,
bookbinders, book sellers, type founders and of embossing, electrotyping,
stereotyping, photographing, engraving and manufacturing and dealing in paper
boxes, stationery, tags, labels, office furniture and office supplies;

     (b) To conduct a general advertising and publicity business in all its
branches, both as principals and agents, and to acquire and operate property,
franchises




and privileges for advertising purposes or for the buying or selling
of advertising or publicity rights, franchises or privileges, and to deal in all
other articles or things of a character similar or analogous to the foregoing or
any of them or connected therewith and in general to undertake and [illegible
word] all kinds of agency business which an individual may legally undertake and
[illegible word] for or connected with the above objects or purposes.

     The operations of the Company to be carried on throughout Canada and
elsewhere.

     The head office of the Company will be situate at the City of Grands
Prairie, in the Province of Alberta.

     The capital stock of the said Company shall consist of One Hundred (100)
Class A preferred shares and Four Hundred (400) Class B preferred shares, all of
the par value of One Hundred Dollars ($100) each, and One Hundred (100) Common
shares without nominal or par value, subject to the increase of such capital
stock under the provisions of the said Act; provided, however, that the
aggregate consideration for the issue of the said [illegible words] par value
shall not exceed in amount or value the sum of One Hundred Dollars ($100) or
such greater amount as the board of directors of the Company may deem expedient
and as may be authorised by the Secretary of State of Canada and payment of the
requisite fees applicable to such greater amount.

     The said Class A preferred shares, the said Class B preferred shares and
the said common shares shall respectively carry and be subject to the following
rights, restrictions, conditions and limitations hereinafter set forth:




1. The Class A preferred shares shall carry the right to a fixed cumulative
preferential divided at the rate of five per centum (5%) per annum, payable
early. The said cumulative divided shall accrue and be cumulative from the
respective date of issue of the said Class A preferred shares, and shall be
payable in quarterly, semi-annual or annual instalments, on such date or dates
as the directors may determine, payable at par at any branch in Canada of the
Company's bankers for the time being. If any dividend shall be unpaid, on any
dividend payment date, the said divided or any unpaid part thereof shall be paid
on a subsequent date or dates in priority to any dividends on the Class B
preferred shares or on the common shares; and no dividends shall be declared or
paid or set apart in respect of the Class B preferred shares or common shares,
unless all accrued cumulative dividends on the Class A preferred shares shall
have been paid.

2. The said Class A preferred shares shall carry the right on liquidation or
winding up of the Company to redemption of capital in priority to the Class B
preferred shares and to the common shares; but they shall not confer a right to
any further participation in the profits or assets, except as hereinafter
provided, namely, that each Class A preferred share shall confer the right to
participate in one-tenth (1/10) of one and one-third per cent (1 1/3%) of the
net profits (if any) of the Company earned in each fiscal year (reckoned
according to standard accounting practice and certified by the Company's
auditors, after allowing as an expense for this purpose the payment of
preferential dividends on both Class A and Class B preferred shares). The said
profit payment shall be made within six (6) months next after the close of each
fiscal year, and shall be prorated in the case of shares issued within such year
so that the said profit




payment shall be proportionate in such case to the portion of such fiscal year
during which said shares were outstanding.

3. The said Class A preferred shares or any part thereof, shall be redeemable at
a price of One Hundred and Ten Dollars ($110) at any time at the option of the
directors of the Company, without the consent of the owners and holders thereof
and if less than the whole amount of the outstanding Class A preferred shares be
so redeemed, the shares to be redeemed shall be selected by lot or pro rata in
such manner as the board of directors may determine. Not less than thirty (30)
days' notice of such redemption shall be given by mailing such notice in writing
to the registered holders of the shares to be redeemed, specifying the date and
place or places of redemption; if notice of any such redemption be given by the
Company in the manner aforesaid and an amount sufficient to redeem the shares be
deposited with any trust company or chartered bank, as specified in the notice,
on or before the date fixed for redemption, dividends on the preferred shares to
be redeemed shall cease after the date so fixed for redemption, and the holders
thereof shall thereafter have no rights against the Company in respect thereof
except, upon the surrender of certificates for such shares, to receive payment
therefor out of the monies so deposited.

4. The holders of the Class A preferred shares shall not as such have any voting
rights for the election of directors or for any other purpose nor shall they be
entitled to attend shareholders' meetings unless and until the Company shall
have failed for a period of two (2) years, consecutive or not, to pay dividends
on the Class A preferred shares, whereupon and whenever the same shall occur,
the holders of the Class A preferred shares, shall, until all arrears of
dividends have been paid on the Class A



preferred shares, be entitled to attend all shareholders' meetings and shall
have twenty (20) votes thereat for each Class A preferred share then held by
them respectively.

5. The Class B preferred shares shall carry the right to a fixed cumulative
preferential dividend, (preferential to the common shares but subsequent to the
rights of the Class A preferred shares) at the rate of five per centum (5%) per
annum. The said cumulative divided shall accrue and be cumulative from the
respective date of issue of the said Class B preferred shares, and shall be
payable in quarterly, semi-annual or annual instalments, on such date or dates
as the directors may determine, payable at par at any branch in Canada of the
Company's bankers for the time being. If any dividend shall be unpaid, on any
dividend payment date, the said dividend or any unpaid part thereof shall be
paid on a subsequent date or dates in priority to any dividends on the common
shares; and no dividends shall be declared or paid or set apart in respect of
the common shares, unless all accrued cumulative dividends on the Class B
preferred shares shall not have been paid.

6. The said Class B preferred shares shall carry the right on liquidation or
winding up of the Company to redemption of capital in priority to the commons
shares, but subsequent to the Class A preferred shares; but they shall not
confer the right to any further participation in profits or assets.

7. The said Class B preferred shares or any part thereof, shall be redeemable at
a price of One Hundred and Ten Dollars ($110), at any time at the option of the
directors of the Company without the consent of the owners and the holders
thereof and if less than the whole amount of the outstanding Class B preferred
shares shall be so redeemed, the shares to be redeemed shall be selected by lot
or pro rata in such manner




as the board of directors may determine. Not less than thirty (30) days' notice
of such redemption shall be given by mailing such notice in writing to the
registered holders of the shares to be redeemed, specifying the date and place
or places of redemption; if notice of any such redemption be given by the
Company in the manner aforesaid and an amount sufficient to redeem the shares be
deposited with any trust company or chartered bank, as specified in the notice,
on or before the date fixed for redemption, dividends on the preferred shares to
be redeemed shall cease after the date fixed for redemption, and the holders
thereof shall thereafter have no rights against the Company in respect thereof
except, upon the surrender of certificates for such shares, to receive payment
therefor out of the monies so deposited.

8. The holders of the Class B preferred shares shall not as such have any voting
rights for the election of directors or for any other purpose nor shall they be
entitled to attend shareholders' meetings unless and until the Company shall
have failed to pay for a period of two (2) years, consecutive or not, to pay any
dividend on the Class B preferred shares, whereupon and whenever the same shall
occur, the holders of the Class B preferred shares shall, until all arrears of
dividends have been paid on the Class B preferred shares, be entitled to attend
all shareholders' meetings and shall have one (1) vote thereat for each Class B
preferred share then held by them respectively.

     AND IT HEREIN ORDAINED AND DECLARED that the Company shall be deemed to be
a private company under the provisions of the Companies Act, with the following
restrictions, vis:-




I. No shares in the capital stock of the Company shall be transferred without
the express consent of the majority of the directors, to be signified by a
resolution passed by the board;

II. The number of shareholders of the Company shall be limited to fifty (50),
not including persons who are in the employment of the Company and persons, who,
having been formerly in the employment of the Company, were, while in that
employment, and have continued after the determination of that employment to be
shareholders of the Company, two (2) or more persons holding one (1) or more
shares jointly being counted as a single shareholder.

III. Any invitation to the public to subscribe for any shares or debentures of
the Company shall be prohibited.

     And it is further ordained and declared that, if authorised by by-law, duly
passed by the directors and sanctioned by at least two-thirds of the votes cast
at a special general meeting of the shareholders duly called for considering the
by-law, the directors may from time to time:

      (a)   borrow money upon the credit of the company;

      (b)   limit or increase the amount to be borrowed;

      (c)   issue debentures or other securities of the company;

      (d)   pledge or sell such debentures or other securities for such uses and
at such prices as may be deemed expedient;




      (e)   mortgage, hypothecate, charge or pledge all or any of the real and
personal property, undertaking and rights of the company to secure any such
debentures or other securities or any money borrowed on any other liability of
the company.

     Nothing in this clause contained shall limit or restrict the borrowing of
money by the Company on bills of exchange or promissory notes made, drawn,
accepted or redeemed by or on behalf of the Company.




                                SUPPLEMENTARY

                                LETTERS PATENT

                                     TO

                           BOWES PUBLISHERS LIMITED


                         Dated  18th October, 1957.
                               -----------------------

                         Recorded  28th November,1957.
                                  --------------------

                           Film  [illegible]  Document  232
                                -------------          -----


                               /s/ [ILLEGIBLE]
                   ------------------------------------------
                   FOR THE DEPUTY REGISTRAR GENERAL OF CANADA


Ref. No.________________


MD



                                     [logo]

                                     CANADA

By the Honourable ELLEN LOUKS FAIRCLOUGH,

                                                   Secretary of State of Canada.

To all to whom these presents shall come, or whom the same may in anywise
concern,

                                                                       GREETING:

WHEREAS BOWES PUBLISHERS LIMITED (hereinafter referred to as "the Company") was
duly incorporated under the provisions of Part I of The Companies Act, 1934, by
letters patent dated the twenty-fifth (25th) day of September, one thousand nine
hundred and fifty (1950), with a capital stock consisting of one hundred (100)
Class A preferred shares of the par value of one hundred dollars ($100) each,
four hundred (400) Class B preferred shares of the par value of one hundred
dollars ($100) each and one hundred (100) common shares without nominal or par
value, provided, however, that the aggregate consideration for the issue of the
said common shares without nominal or par value shall not exceed in amount or
value the sum of one hundred dollars ($100) or such greater amount as the board
of directors of the Company may deem expedient and as may be authorized by the
Secretary of State of Canada on payment of the requisite fees applicable to such
greater amount;

         AND WHEREAS the Company has applied by petition to me, the Secretary of
State of Canada, for the issue of supplementary letters patent under the
provisions of Part I of Chapter 53 of the Revised Statutes of Canada, 1952,
known as the Companies Act, amending and varying the provisions of its letters
patent and increasing its capital stock as hereinafter set forth, the whole in
accordance with By-law No. 6, which by-law was enacted by the directors of the
Company on the fifteenth (15th) day of June, one thousand nine hundred and
fifty-six (1956),



and duly sanctioned by at least two-thirds (2/3) of the votes cast by the
holders of the common shares at a special general meeting of the shareholders of
the Company duly called for considering the said by-law and held on the said
fifteenth (15th) day of June, one thousand nine hundred and fifty-six (1956);

         AND WHEREAS the Company has satisfactorily established the sufficiency
of all proceedings by the said Act required to be taken and the truth of all
facts by the said Act required to be established previous to the granting of
such supplementary letters patent;

         NOW KNOW YE THAT I, ELLEN LOUKS FAIRCLOUGH, Secretary of State of
Canada, by virtue of the power vested in me by the said Act and of any other
power or authority whatever in me vested in this behalf, do by these my
supplementary letters patent:

         (a) in pursuance of the said By-law No. 6 of the Company, duly enacted
and sanctioned as aforesaid, amend and vary the provisions of the letters patent
incorporating the Company by deleting and expunging therefrom the statement of
the rights, restrictions, conditions and limitations attaching to the Class A
preferred shares, the Class B preferred shares and the common shares of the
capital stock of the Company and substituting therefor the rights, restrictions,
conditions and limitations hereinafter set forth; and

         (b) confirm the said By-law No. 6 of the Company, duly enacted and
sanctioned as aforesaid, increasing the capital stock of the Company by the
creation of six hundred (600) Class C preferred shares of the par value of one
hundred dollars ($100) each to carry and be subject to the rights, restrictions,
conditions and limitations hereinafter set forth;

         so that the authorized capital of the Company shall be as follows:

         "The capital stock of the Company shall consist of one hundred (100)
Class A preferred shares of the par value of one hundred dollars ($100) each,
four hundred (400) Class B preferred shares of the par value of one hundred
dollars ($100) each, six hundred (600) class C preferred shares of the par value
of one hundred dollars ($100) each and one hundred (100)



common shares without nominal or par value, provided, however, that the
aggregate consideration for the issue of the said one hundred (100) common
shares without nominal or par value shall not exceed in amount or value the sum
of one hundred dollars ($100) or such greater amount as the board of directors
of the Company may deem expedient and as may be authorized by the Secretary of
State of Canada on payment of the requisite fees applicable to such greater
amount.

         The said Class A preferred shares, the said Class B preferred shares,
the said Class C preferred shares and the said common shares shall respectively
carry and be subject to the rights, restrictions, conditions and limitations
hereinafter set forth:

          1. The Class A preferred shares shall carry the right to a fixed
cumulative preferential dividend at the rate of five per cent (5%) per annum.
The said cumulative dividend shall accrue and be cumulative from the respective
dates of issue of the said Class A preferred shares and shall be payable in
quarterly, semi-annual or annual instalments, on such date or dates as the
directors may determine, at par at any branch in Canada of the Company's bankers
for the time being. If any dividend shall be unpaid on any dividend payment
date, the said dividend or any unpaid part thereof shall be paid on a subsequent
date or dates in priority to any dividends on the Class B or Class C preferred
shares or on the common shares and no dividends shall be declared or paid or set
apart in respect of the Class B or Class C preferred shares or common shares
unless all accrued cumulative dividends on the Class A preferred shares shall
have been paid.

         2. The said Class A preferred shares shall carry the right on
liquidation or winding up of the Company to repayment of capital in priority to
the Class B and Class C preferred shares and to the common shares, but they
shall not confer a right to any further participation in the profits or assets,
except as hereinafter provided, namely, that each Class A preferred share shall
confer the right to participate in one-tenth (1/10) of one and one-third per
cent (1-1/3%) of



the net profit (if any) of the Company earned in each fiscal year (reckoned
according to standard accounting practice and certified by the Company's
auditors, after allowing as an expense for this purpose the payment of
preferential dividends on both Class A and Class B preferred shares). The said
profit payment shall be made within six (6) months next after the close of each
fiscal year and shall be pro-rated in the case of shares issued within such year
so that said profit payment shall be proportionate in such case to the portion
of such fiscal year during which said shares were outstanding.

         3. The said Class A preferred shares on any part thereof shall be
redeemable at a price of one hundred and ten dollars ($110) per share at any
time at the option of the directors of the Company without the consent of the
owners and the holders thereof and if less than the whole amount of the
outstanding Class A preferred shares shall be so redeemed, the shares to be
redeemed shall be selected by lot or PRO RATA in such manner as the board of
directors may determine. Not less than thirty (30) days' notice of such
redemption shall be given by mailing such notice in writing to the registered
holders of the shares to be redeemed, specifying the date and place or places of
redemption; if notice of any such redemption be given by the Company in the
manner aforesaid and an amount sufficient to redeem the shares be deposited with
any trust company or chartered bank, as specified in the notice, on or before
the date fixed for redemption, dividends on the Class A preferred shares to be
redeemed shall cease after the date so fixed for redemption and the holders
thereof shall thereafter have no rights against the Company in respect thereof
except, upon the surrender of certificates for such shares, to receive payment
therefore out of the moneys so deposited.

         4. The holders of the Class A preferred shares shall not as such have
any voting rights for the election of directors or for any other purpose nor
shall they be entitled to attend shareholders' meetings unless and until the
Company shall have failed for a period of two (2) years, consecutive or not, to
pay dividends on the Class A preferred shares, whereupon and



whenever the same shall occur, the holders of the Class A preferred shares
shall, until all arrears of dividends have been paid on the Class A preferred
shares, be entitled to attend all shareholders' meetings and shall have twenty
(20) votes thereat for each Class A preferred share then held by them
respectively.

         5. The Class B preferred shares shall carry the right to a fixed
cumulative preferential dividend (preferential to the Class C preferred shares
and common shares but subsequent to the rights of the holders of Class A
preferred shares) at the rate of five per cent (5%) per annum. The said
cumulative dividend shall accrue and be cumulative from the respective dates of
issue of the said Class B preferred shares and shall be payable in quarterly,
semi-annual or annual instalments, on such date or dates as the directors may
determine, at par at any branch in Canada of the Company's bankers for the time
being. If any dividend shall be unpaid on any dividend payment date, the said
dividend or any unpaid part thereof shall be paid on a subsequent date or dates
in priority to any dividends on the Class C preferred shares or common shares
and no dividends shall be declared or paid or set apart in respect of the common
shares or the Class C preferred shares unless all accrued cumulative dividends
on the Class B preferred shares shall have been paid.

         6. The said Class B preferred shares shall carry the right on
liquidation or winding-up of the Company to repayment of capital in priority to
the common shares and Class C preferred shares, but subsequent to the Class A
preferred shares, but they shall not confer the right to any further
participation in profits or assets.

         7. The said Class B preferred shares or any part thereof shall be
redeemable at a price of one hundred and ten dollars ($110) per share at any
time at the option of the directors of the Company without the consent of the
owners and the holders thereof and if less than the whole amount of the
outstanding Class B preferred shares shall be so redeemed, the shares to be
redeemed shall be selected by lot or PRO RATA in such manner as the board of
directors may



determine. Not less than thirty (30) days' notice of such redemption shall be
given by mailing such notice in writing to the registered holders of the shares
to be redeemed, specifying the date and place or places of redemption; if notice
of any such redemption be given by the Company in the manner aforesaid and an
amount sufficient to redeem the shares be deposited with any trust company or
chartered bank, as specified in the notice, on or before the date fixed for
redemption, dividends on the Class B preferred shares to be redeemed shall cease
after the date so fixed for redemption and the holders thereof shall thereafter
have no rights against the Company in respect thereof except, upon the surrender
of certificates for such shares, to receive payment therefor out of the moneys
so deposited.

         8. The holders of the Class B preferred shares shall not as such have
any voting rights for the election of directors or for any other purpose nor
shall they be entitled to attend shareholders' meetings unless and until the
Company shall have failed for a period of two (2) years, consecutive or not, to
pay any dividend on the Class B preferred shares, whereupon and whenever the
same shall occur, the holders of the Class B preferred shares shall, until all
arrears of dividends have been paid on the Class B preferred shares, be entitled
to attend all shareholders' meetings and shall have one (1) vote thereat for
each Class B preferred share then held by them respectively.

         9. The Class C preferred shares shall carry the right to a fixed
cumulative preferential dividend (preferential to the common shares but
subsequent to the rights of the holders of Class A and Class B preferred shares)
at the rate of six per cent (6%) per annum. The said cumulative dividend shall
accrue and be cumulative from the respective dates of issue of the said Class C
preferred shares and shall be payable in quarterly, semi-annual or annual
instalments, on such date or dates as the directors may determine, at par at any
branch in Canada of the Company's bankers for the time being. If any dividend
shall be unpaid on any dividend payment date, the said dividend or any unpaid
part thereof shall be paid on a



subsequent date or dates in priority to any dividends on the common shares and
no dividends shall be declared or paid or set apart in respect of the common
shares unless all accrued cumulative dividends on the Class C preferred shares
shall have been paid.

         10. The said Class C preferred shares shall carry the right on
liquidation or winding-up of the Company to repayment of capital in priority to
the common shares, but subsequent to the Class A and Class B preferred shares,
but they shall not confer the right to any further participation in profits or
assets.

         11. The said Class C preferred shares or any part thereof shall be
redeemable at par with thirty (30) days' notice at any time at the option of the
directors of the Company without the consent of the owners and holders thereof
and if less than the whole amount of the outstanding Class C preferred shares
shall be so redeemed, the shares to be redeemed shall be selected by lot or PRO
RATA in such manner as the board of directors may determine. Not less than
thirty (30) days' notice of such redemption shall be given by mailing such
notice in writing to the registered holders of the shares to be redeemed,
specifying the date and place or places of redemption; if notice of any such
redemption be given by the Company in the manner aforesaid and an amount
sufficient to redeem the shares be deposited with any trust company or chartered
bank, as specified in the notice, on or before the date fixed for redemption,
dividends on the Class C preferred shares to be redeemed shall cease after the
date so fixed for redemption and the holders thereof shall thereafter have no
rights against the Company in respect thereof except, upon the surrender of
certificates for such shares, to receive payment therefor out of the moneys so
deposited.

         12. The holders of the Class C preferred shares shall not as such have
any voting rights for the election of directors or for any other purpose nor
shall they be entitled to attend shareholders' meetings unless and until the
Company shall have failed for a period of two (2) years, consecutive or not, to
pay any dividend on the Class C preferred shares, whereupon and



whenever the same shall occur, the holders of the Class C preferred shares
shall, until all arrears of dividends have been paid on the Class C preferred
shares, be entitled to attend all shareholders' meetings and shall have one (1)
vote thereat for each Class C preferred share then held by them respectively."

         Given under my seal of office at Ottawa this eighteenth day of October,
one thousand nine hundred and fifty-seven.

                                       /s/ [illegible]
                                       for the Secretary of State.



[SEAL]




                                    [LOGO]
                                    CANADA



CERTIFICATE OF CONTINUANCE                            CERTIFICAT DE PROROGATION

CANADA BUSINESS                                            LOI SUR LES SOCIETES
CORPORATIONS ACT                                       COMMERCIALES CANADIENNES








   BOWES PUBLISHERS LIMITED                                    32776
   ------------------------------------------------       ---------------
   Name of Corporation - Denomination de la societe       Number - Numero



   I hereby certify that the above-      Je certifie par les presentes que la
   mentioned Corporation was con-        societe mentionnee ci-haut a ete
   tinued under Section 181 of the       prorogee en vertu de l'article 181 de
   Canada Business Corporations Act      la Loi sur les societes commer-
   as set out in the attached articles   ciales canadiennes, tel qu'indique
   of Continuance.                       dans les clauses de prorogation
                                         ci-jointes.






   /s/ [illegible]                   November 5, 1980
       Director - Directeur        Date of Continuance - Date de la prorogation




                        CANADA BUSINESS CORPORATIONS ACT

                                     FORM 11

                             ARTICLES OF CONTINUANCE

                                  (Section 181)

1.       Name of Corporation:

         BOWES PUBLISHERS LIMITED

2.       Place in Canada where the registered office is to be situate:

         City of Edmonton, Province of Alberta

3.       The classes and any maximum number of shares that the Corporation is
         authorized to issue:

         The authorized capital of the Corporation shall consist of One Million
         (1,000,000) common shares.

4.       Restrictions, if any, on share transfers:

         No share of the capital stock of the Corporation shall be transferred
         without the previous sanction of the board of directors of the
         Corporation expressed by resolution passed at a meeting of the board of
         directors or by an instrument or instruments in writing signed by all
         of the directors of the Corporation.

5.       Number of directors:

         The number of directors of the Corporation shall be such number not
         fewer than three nor more than nine, as may be determined from time to
         time by the board of directors.

6.       Restrictions, if any, on business the Corporation may carry on:

         There are no restrictions in these articles on the business which the
         Corporation may carry on.

7.       If change of name effected, previous name:

         N/A



                                     - 2 -

8.       Other provisions, if any:

         (a)      The number of shareholders of the Corporation shall be
                  limited to fifty (50), not including persons who are in the
                  employment of the Corporation and persons who, having been
                  formerly in the employment of the Corporation, were, while
                  in that employment and have continued after the termination
                  of that employment to be, shareholders of the Corporation;

          b)      Any invitation to the public to subscribe for securities of
                  the Corporation is prohibited;

         (c)      Without in any way limiting the powers conferred upon the
                  Corporation and its directors by the Canada Business
                  Corporations Act, the board of directors may, from time to
                  time, in such amounts and on such terms as it deems expedient,
                  charge, mortgage, hypothecate or pledge, or grant any form of
                  security interest in, all or any of the currently owned or
                  subsequently acquired, real or personal, moveable or
                  immoveable, property of the Corporation, including book debts,
                  rights, powers, franchises and undertaking, to secure any debt
                  obligations or any money borrowed or other debt or liability
                  of the Corporation.

                  The board of directors may from time to time delegate to such
                  one or more of the directors and officers of the Corporation
                  as may be designated by the board all or any of the powers
                  conferred on the board above to such extent and in such manner
                  as the board shall determine at the time of each such
                  delegation.

                  Dated the 3rd day of November 1980.

                                    /s/ [illegible]
                                    Secretary

Corporation No:  32776                                 Filed:  November 10, 1980




[LOGO]              Consumer and                         Consommation
CANADA              Corporate Affairs Canada             et Corporations Canada



CERTIFICATE OF AMENDMENT                             CERTIFICAT DE MODIFICATION

CANADA BUSINESS                                            LOI SUR LES SOCIETES
CORPORATIONS ACT                                       COMMERCIALES CANADIENNES



BOWES PUBLISHERS LIMITED                                  032776-0

Name of Corporation - Denomination de la societe      Number - Numero

                                            
I hereby certify that the Articles of          Je certifie par les presentes que les
the above-mentioned Corporation                statuts de la societe mentionnee
were amended                                   ci-haut ont ete modifies

(a) under Section 13 of the Canada      / /    (a)  en vertu de l'article 13 de la
Business Corporations Act in                   Loi sur les societes commerciales
accordance with the attached                   canadiennes conformement a l'avis
notice;                                        ci-joint;

(b)  under Section 27 of the Canada     / /    (b) en vertu de l'article 27 de la Loi
Business Corporations Act as set out           sur les societes commerciales
in the attached Articles of Amendment          canadiennes tel qu'indique dans les
designating a series of shares;                clauses modificatrices ci-jointes
                                               designant une serie d'actions;

(c)  under Section 171 of the Canada    /X/    (c) en vertu de l'article 171 de la
Business Corporations Act as set out           Loi sur les societes commerciales
in the attached Articles of Amendment;         canadiennes tel qu'indique
                                               dans les clauses modificatrices
                                               ci-jointes;

(d)  under Section 185 of the Canada    / /    (d) en vertu de l'article 185 de la
Business Corporations Act as set out           Loi sur les societes commerciales
in the attached Articles of                    canadiennes tel qu'indique dans
Reorganization;                                les clauses de reorganisation
                                               ci-jointes;

(e)  under Section 185.1 of the Canada  / /    (e) en vertu de l'article 185.1 de la
Business Corporations Act as set out           Loi sur les societes commerciales
in the attached Articles of                    canadiennes tel qu'indique dans
Arrangement.                                   les clauses d'arrangement ci-jointes.




       Le Directeur

   /s/ [illegible]                   August 10, 1988/le 10 aout 1988
       Director                     Date of Amendment - Date de la modification





5/103275/ID1418/120788mcm

                                                                    
Consumer and
Corporate            Consommation                          FORM 4                 FORMULE 4
Affairs Canada       et Corporations Canada
                                                   ARTICLES OF AMENDMENT     CLAUSES MODIFICATRICES
Canada Business      Loi sur les societes
Corporations Act     commerciales canadiennes       (SECTION 27 OR 171)      (ARTICLE 27 OU 171)

- ---------------------------------------------------------------------------------------------------
1 - Name of Corporation - Denomination             | 2 - Corporation No. - No de la societe
    de la societe                                  |
                                                   |
  BOWES PUBLISHERS LIMITED                         |               32776 - O
- ---------------------------------------------------------------------------------------------------
3 - The articles of the above-named                  Les statuts de la societe ci-haut mentionnee
    corporation are amended as follows:              sont modifies de la facon suivante:


         Pursuant to section 167(1)(d) of the Act, Article 3 of the Articles of Continuance of
         the Corporation is hereby amended by changing the maximum number of common shares the
         Corporation is authorized to issue from ONE MILLION (1,000,000) to ONE MILLION TEN
         THOUSAND (1,010,000) common shares.







                                               
- ---------------------------------------------------------------------------------------------------
Date                 | Signature                     | Description of Office - Description du poste
                     |                               |
                     |                               |
                     |                               |
July 22, 1988        | /s/ James E. Bowes            |            DIRECTOR
                     |------------------------       |
                     |     JAMES E. BOWES            |
- ---------------------------------------------------------------------------------------------------
                                                     | FOR DEPARTMENTAL USE ONLY - A L'USAGE DU
                                                     | MINISTERE SEULEMENT
                                                     |
                                                     | Filed - Deposee     10-8-1988
                                                     |
                                                     ----------------------------------------------



CCA-1387 (4/85)






[LOGO]   Consumer and               Consommation
         Corporate Affairs Canada   et Corporations Canada




CERTIFICATE OF AMALGAMATION                                CERTIFICAT DE FUSION

CANADA BUSINESS                                            LOI SUR LES SOCIETES
CORPORATIONS ACT                                       COMMERCIALES CANADIENNES








   BOWES PUBLISHERS LIMITED                                  240690-0

   Name of Corporation - Denomination de la societe       Number - Numero



   I hereby certify that the above-      Je certifie par les presentes que
   mentioned Corporation resulted from   la societe mentionnee ci-haut resulte
   the amalgamation of the following     de la fusion des societes ci-dessous,
   Corporations under Section 179 of     en vertu de l'article 179 de la Loi
   the Canada Business Corporations      sur les societes commerciales
   Act, as set out in the attached       canadiennes, tel qu'indique dans les
   articles of Amalgamation.             statuts de fusion ci-joints.




       Le Directeur

   /s/ [illegible]                       November 30, 1988/le 30 novembre 1988
       Director                          Date of Amalgamation - Date de fusion





   [CANADA LOGO]







94 [illegible] 103946-ID566-281188mcm

- -------------------------------------------------------------------------------

            CANADA BUSINESS                      LOI SUR LES SOCIETES
           CORPORATIONS ACT                    COMMERCIALES CANADIENNES
                FORM 9                                 FORMULE 9
       ARTICLES OF AMALGAMATION                    STATUS DE FUSION
            (SECTION 179)                            (ARTICLE 179)

- -------------------------------------------------------------------------------

1 - Name of Amalgamated Corporation       Denomination de la societe issue
                                          de la fusion
    BOWES PUBLISHERS LIMITED

- -------------------------------------------------------------------------------

2 - The place within Canada where         Lieu au Canada ou doit etre situe
    the registered office is to be        le siege social
    situated

    Edmonton, Alberta

- -------------------------------------------------------------------------------

3 - The classes and any maximum number    Categories et tout nombre maximal
    of shares that the corporation        d'actions que la societe est
    is authorized to issue                autorisee a emettre

The authorized capital of the Corporation shall consist of One Million
Ten Thousand (1,010,000) common shares.

- -------------------------------------------------------------------------------

4 - Restrictions if any on share          Restrictions sur le transfert des
    transfers                             actions, s'il y a lieu

    See attached Schedule "A".

- -------------------------------------------------------------------------------

5 - Number (or minimum and                Nombre (ou nombre minimum et
    maximum number) of directors          maximum) d'administrateurs

The number of directors of the Corporation shall consist of five (5) directors.

- -------------------------------------------------------------------------------

6 - Restrictions if any on                Limites imposees quant aux
    business the corporation may          activites que la societe peut
    carry on                              exploiter, s'il y a lieu

    There are no restrictions in these Articles on the business which the
    Corporation may carry on.

- -------------------------------------------------------------------------------

7 - Other provisions if any               Autres dispositions s'il y a lieu

    See attached Schedule "B".

- -------------------------------------------------------------------------------




                                    - 2 -


                                                          
- ---------------------------------------------------------------------------------------------------
8 - The amalgamation agreement has been approved        ---     La convention de fusion a ete
    by special resolutions of shareholders of each              approuvee par resolutions speciales
    of the amalgamating corporations listed in                  des actionnaires de chacune des
    item 10 below in accordance with Section 177                societes fusionnantes enumerees a
    of the Canada Business Corporations Act.                    la rubrique 10 ci-dessous, en
                                                                conformite de l'article 177 de la
                                                                Loi sur les societes commerciales
                                                                canadiennes.

    The amalgamation has been approved by a              X      La fusion a ete approuvee par
    resolution of the directors of each of              ---     resolution des administrateurs de
    the amalgamating corporations listed in                     chacune des societes fusionnantes
    Item 10 below in accordance with Section                    enumerees a la rubrique 10 ci-
    178 of the Canada Business Corporations Act.                desous en conformite de l'article
    These articles of amalgamation are the same                 178 de la Loi sur les societes
    as the articles of incorporation of                         commerciales canadiennes. Les
    (name of the designated amalgamating                        presents statuts de fusion sont
    corporation)                                                les memes que les statuts
                                                                constitutifs de (nommer la societe
                                                                fusionnante designee).

BOWES PUBLISHERS LIMITED
- ---------------------------------------------------------------------------------------------------
9 - Name of the amalgamating corporation                ---     Denomination de la societe
    the by-laws of which are to be the                          fusionnante dont les reglements
    by-laws of the amalgamating corporation.                    doivent etre les reglements de la
                                                                societe issue de la fusion.

    BOWES PUBLISHERS LIMITED




                                                                       
- ---------------------------------------------------------------------------------------------------
10 - Name of Amalgamating   Corporation No.   Signature            Date            Description of
     Corporations           No de la societe                                       office
     Denomination des                                                              Description du
     societes                                                                      poste
     fusionnantes

Bowes Publishers Limited    32776-0           /s/ K. KIRKPATRICK   Nov. 21, 1988   Director
                                                  --------------
                                                  K. Kirkpatrick

Vopni Press Limited         240478-8          /s/ K. KIRKPATRICK   Nov. 21, 1988   Director
                                                  --------------
                                                  K. Kirkpatrick

62427 Manitoba Ltd.         240479-6           /s/ K. KIRKPATRICK   Nov. 21, 1988   Director
                                                  --------------
                                                  K. Kirkpatrick

Kenora Miner and News       240481-8           /s/ K. KIRKPATRICK   Nov. 21, 1988   Director
      Limited                                      --------------
                                                  K. Kirkpatrick

Hanna Dagmar Publications   240480-0           /s/ K. KIRKPATRICK   Nov. 21, 1988   Director
     Inc.                                          --------------
                                                  K. Kirkpatrick
- ---------------------------------------------------------------------------------------------------
FOR DEPARTMENTAL USE ONLY                                       A L'USAGE DU MINISTERE SEULEMENT
Corporation No. - No de la societe                              Filed - Deposee
                  240690-0                                              22-12-88






94-103946-ID567

                                  SCHEDULE "A"

         No share of the capital stock of the Corporation shall be transferred
without the previous sanction of the board of directors of the Corporation
expressed by resolution passed at a meeting of the board of directors or by an
instrument or instruments in writing signed by all of the directors of the
Corporation.




94-103946-ID568

                                  SCHEDULE "B"

         (a) The number of shareholders of the Corporation shall be limited to
fifty (50), not including persons who are in the employment of the Corporation
and persons who, having been formally in the employment of the corporation,
were, while in that employment and have continued after the termination of that
employment to be, shareholders of the corporation;

         (b) Any invitation to the public to subscribe for securities of the
Corporation is prohibited;

         (c) Without in any way limiting the powers conferred upon the
Corporation and its directors by the Canada Business Corporations Act, the board
of directors may, from time to time, in such amounts and on such terms as it
deems expedient, charge, mortgage, hypothecate or pledge, or grant any form of
security interest in, all or any of the currently owned or subsequently
acquired, real or personal, moveable or immoveable, property of the Corporation,
including book debts, rights, powers, franchises and undertaking, to secure any
debt obligations or any money borrowed or other debt or liability of the
Corporation.

         The board of directors may from time to time delegate to such one or
more of the directors and officers of the Corporation as may be designated by
the board all or any of the powers conferred on the board above to such
extent and in such manner as the board shall determine at the time of each
such delegation.



[LOGO]              Consumer and                         Consommation
CANADA              Corporate Affairs Canada             et Corporations Canada



CERTIFICATE OF AMENDMENT                            CERTIFICAT DE MODIFICATION

CANADA BUSINESS                                     LOI REGISSANT LES SOCIETES
CORPORATIONS ACT                                  PAR ACTIONS DE REGIME FEDERAL



BOWES PUBLISHERS LIMITED                                    240690-0
Name of Corporation - Denomination de la societe       Number - Numero


                                             
I hereby certify that the Articles              Je certifie par les presentes que les
of the above-mentioned Corporation              statuts de la societe mentionnee ci-haut
were amended                                    a ete modifies

(a)  under Section 13 of the Canada      / /    (a)  en vertu de l'article 13 de la
Business Corporations Act in                    Loi regissant les societes par actions
accordance with the attached notice;            de regime federal conformement a l'avis
                                                ci-joint;

(b)  under Section 27 of the Canada      / /    (b) en vertu de l'article 27 de la Loi
Business Corporations Act as set out            regissant les societes par actions de
in the attached Articles of Amendment           regime federal tel qu'indique dans les
designating a series of shares;                 clauses modificatrices ci-jointes
                                                designant une serie d'actions;

(c)  under Section 177 of the Canada     /X/    (c) en vertu de l'article 177 de la
Business Corporations Act as set out            Loi regissant les societes par
in the attached Articles of Amendment;          actions de regime federal tel
                                                qu'indique dans les clauses
                                                modificatrices ci-jointes;


(d)  under Section 191 of the Canada     / /    (d) en vertu de l'article 191 de la
Business Corporations Act as set out            Loi regissant les societes par
in the attached Articles of                     actions de regime federal tel
Reorganization;                                 qu'indique dans les clauses de
                                                reorganisation ci-jointes;

(e)  under Section 192 of the Canada     / /    (e) en vertu de l'article 192 de la
Business Corporations Act as set out            Loi regissant les societes par
in the attached Articles of                     actions de regime federal tel
Arrangement.                                    qu'indique dans les clauses
                                                d'arrangement ci-jointes.



       Le directeur

   /s/ [illegible]                   September 10, 1990/le 10 septembre 1990
       Director                     Date of Amendment - Date de la modification


    [CANADA LOGO]





39-21432 [illegible] ID8486-160890bmb

                                                                    
Consumer and
Corporate            Consommation                          FORM 4                 FORMULE 4
Affairs Canada       et Corporations Canada
                                                   ARTICLES OF AMENDMENT     CLAUSES MODIFICATRICES
Canada Business      Loi sur les societes
Corporations Act     commerciales canadiennes       (SECTION 27 OR 171)      (ARTICLE 27 OU 171)

- ---------------------------------------------------------------------------------------------------
1 - Name of Corporation - Denomination             | 2 - Corporation No. - No de la societe
    de la societe                                  |
                                                   |
  BOWES PUBLISHERS LIMITED                         |               240690-0-R
- ---------------------------------------------------------------------------------------------------
3 - The articles of the above-named                  Les statuts de la societe ci-haut mentionnee
    corporation are amended as follows:              sont modifies de la facon suivante:


         "Article 2 of the Articles of Amalgamation shall be deleted and the
following be inserted:

          THE PLACE WITHIN CANADA WHERE THE REGISTERED OFFICE IS TO BE
SITUATED SHALL BE:

                                          HYDE PARK, ONTARIO."





                                               
- ---------------------------------------------------------------------------------------------------
Date                 | Signature                     | Description of Office - Description du poste
                     |                               |
                     |                               |
                     |                               |
August 20, 1990      | /s/ Donald J. Sinclair        |            VICE-PRESIDENT
                     |------------------------       |
                     |     DONALD J. SINCLAIR        |
- ---------------------------------------------------------------------------------------------------
                                                     | FOR DEPARTMENTAL USE ONLY - A L'USAGE DU
                                                     | MINISTERE SEULEMENT
                                                     |
                                                     | Filed - Deposee     SEP 14 1990
                                                     |
                                                     ----------------------------------------------



CCA-1387 (4/85)





[LOGO]   Consumer and               Consommation
         Corporate Affairs Canada   et Corporations Canada




CERTIFICATE OF AMALGAMATION                                CERTIFICAT DE FUSION

CANADA BUSINESS                                      LOI REGISSANT LES SOCIETES
CORPORATIONS ACT                                  PAR ACTIONS DE REGIME FEDERAL








   BOWES PUBLISHERS LIMITED                                  265704-0

   Name of Corporation - Denomination de la societe       Number - Numero



   I hereby certify that the above-      Je certifie par les presentes que
   mentioned Corporation resulted from   la societe mentionnee ci-haut resulte
   the amalgamation of the following     de la fusion des societes ci-dessous,
   Corporations under Section 185 of     en vertu de l'article 185 de la Loi
   the Canada Business Corporations      regissant les societes par actions de
   Act, as set out in the attached       regime federal, tel qu'indique dans
   articles of Amalgamation.             les statuts de fusion ci-joints.




       Le directeur

   /s/ [illegible]                       November 30, 1990/le 30 novembre 1990
       Director                          Date of Amalgamation - Date de fusion





   [CANADA LOGO]





[illegible] 107882-ID471-091090pla



- -----------------------------------------------------------------------------------------------------------------------------
                      CANADA BUSINESS                                               LOI SUR LES SOCIETES
                     CORPORATIONS ACT                                             COMMERCIALES CANADIENNES
                          FORM 9                                                          FORMULE 9
                 ARTICLES OF AMALGAMATION                                             STATUTS DE FUSION
                       (SECTION 185)                                                     (ARTICLE 185)
- -----------------------------------------------------------------------------------------------------------------------------
                                                                  
1 - Name of Amalgamated Corporation                                  Denomination de la societe issue de la fusion

    BOWES PUBLISHERS LIMITED
- -----------------------------------------------------------------------------------------------------------------------------
2 - The place within Canada where the registered office              Lieu au Canada ou doit etre situe le siege social
    is to be situated:

    Hyde Park, Ontario
- -----------------------------------------------------------------------------------------------------------------------------
3 - The classes and any maximum number of shares that the            Categories et tout nombre maximal d'actions que la
    corporation is authorized to issue                               societe est autorisee a emettre

    The authorized capital of the Corporation shall consist of One Million Ten Thousand (1,010,000) common shares.
- -----------------------------------------------------------------------------------------------------------------------------
4 - Restrictions if any on share transfers                           Restrictions sur le transfert des actions, s'il y a lieu

    No share of the capital stock of the Corporation shall be transferred without the previous sanction of the board of
    directors of the Corporation expressed by resolution passed at a meeting of the board of directors of by an instrument or
    instruments in writing signed by all of the directors of the Corporation.
- -----------------------------------------------------------------------------------------------------------------------------
5 - Number (or minimum and maximum number) of directors              Nombre (ou nombre minimum et maximum) d'administrateurs

    The number of directors of the Corporation shall consist of five (5) directors.
- -----------------------------------------------------------------------------------------------------------------------------
6 - Restrictions if any on business the corporation may              Limites imposees quant aux activites que la societe peut
    carry on                                                         exploiter, s'il y a lieu

    There are no restrictions in these Articles on the business which the Corporation may carry on.





                                       - 2 -


- -----------------------------------------------------------------------------------------------------------------------------
                                                                  
7 - Other provisions if any                                          Autres dispositions s'il y a lieu

    (a) The number of shareholders of the Corporation shall be limited to fifty (50), not including persons who are in the
employment of the Corporation and persons who, having been formally in the employment of the Corporation, were, while in that
employment and have continued after the termination of that employment to be, shareholders of the Corporation;

    (b) Any invitation to the public to subscribe for securities of the Corporation is prohibited;

    (c) Without in any way limited the powers conferred upon the Corporation and its directors by the Canada Business
Corporations Act, the board of directors may, from time to time, in such amounts and on such terms as it deems expedient,
charge, mortgage, hypothecate or pledge, or grant any form of security interest in, all or any of the currently owned or
subsequently acquired, real or personal, moveable or immoveable, property of the Corporation, including book debts, rights,
powers, franchises and undertaking, to secure any debt obligations or any money borrowed or other debt or liability of the
Corporation.

        The board of directors may from time to time delegate to such one or more of the directors and officers of the
Corporation as may be designated by the board all or any of the powers conferred on the board above to such extent and in
such manner as the board shall determine at the time of each such delegation.
- -----------------------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------------------
8 - The amalgamation agreement has been approved by special              La convention de fusion a ete approuvee par
    resolutions of shareholders of each of the amalgamating          --- resolutions speciales des actionnaires de chacune
    corporations listed in item 10 below in accordance with              des societes fusionnantes enumerees a la rubrique 10
    Section 183 of the Canada Business Corporations Act.                 ci-dessous, en conformite de l'article 183 de la Loi
                                                                         sur les societes commerciales canadiennes.

    The amalgamation has been approved by a resolution of the         X  La fusion a ete approuvee par resolution des
    directors of each of the amalgamating corporations listed        --- administrateurs de chacune des societes fusionnantes
    in item 10 below in accordance with Section 184 of the Canada        enumerees a la rubrique 10 ci-dessous en conformite
    Business Corporations Act. These articles of amalgamation are        de l'article 184 de la Loi sur les societes
    the same as the articles of amalgamation of BOWES PUBLISHERS         commerciales canadiennes. Les presents statuts de
    LIMITED.                                                             fusion sont les memes que les statuts constitutifs
                                                                         de (nommer la societe fusionnante designee).
- -----------------------------------------------------------------------------------------------------------------------------
9 - Name of the amalgamating corporation the by-laws of which            Denomination de la societe fusionnante dont les
    are to be the by-laws of the amalgamated corporation.                reglements doivent etre les reglements de la societe
                                                                         issue de la fusion.
    BOWES PUBLISHERS LIMITED



                                       - 3 -


- -----------------------------------------------------------------------------------------------------------------------------
                                                                                     
10 - Name of Amalgamating      Corporation No.       Signature                Date               Description of Office
     Corporations              No de la societe                                                  Description du poste
     Denomination des
     societes
     fusionnantes

     BOWES PUBLISHERS                                /s/ William Dempsey
       LIMITED                    240690-O-R         -------------------      Oct. 22, 1990           DIRECTOR
                                                       WILLIAM DEMPSEY

     STRATHROY AGE                                   /s/ William Dempsey
       DISPATCH INC.               265703-1          -------------------      Oct. 22, 1990           DIRECTOR
                                                       WILLIAM DEMPSEY
- -----------------------------------------------------------------------------------------------------------------------------
FOR DEPARTMENTAL USE ONLY                                            A L'USAGE DU MINISTERE SEULEMENT
Corporation No. - No de la societe                                   Filed - Deposee

265704-0                                                             November 22, 1990







[LOGO]   Consumer and               Consommation
         Corporate Affairs Canada   et Corporations Canada




CERTIFICATE OF AMALGAMATION                                CERTIFICAT DE FUSION

CANADA BUSINESS                                      LOI REGISSANT LES SOCIETES
CORPORATIONS ACT                                  PAR ACTIONS DE REGIME FEDERAL








   BOWES PUBLISHERS LIMITED                                  278070-4

   Name of Corporation - Denomination de la societe       Number - Numero



   I hereby certify that the above-      Je certifie par les presentes que
   mentioned Corporation resulted from   la societe mentionnee ci-haut resulte
   the amalgamation of the following     de la fusion des societes ci-dessous,
   Corporations under Section 185 of     en vertu de l'article 185 de la Loi
   the Canada Business Corporations      regissant les societes par actions de
   Act, as set out in the attached       regime federal, tel qu'indique dans
   articles of Amalgamation.             les statuts de fusion ci-joints.




       Le directeur

   /s/ [illegible]                       December 29, 1991/le 29 decembre 1991
       Director                          Date of Amalgamation - Date de fusion





   [CANADA LOGO]





                                                                                     
                                                                       FORM 9                     FORMULE 9
Canada Business         Loi regissant les societes            ARTICLES OF AMALGAMATION         STATUS DE FUSION
Corporations Act        par actions de regime federal               (SECTION 185)                (ARTICLE 185)
- ----------------------------------------------------------------------------------------------------------------------------------
 1 - Name of Amalgamated Corporation                            Denomination de la societe issue de la fusion

     BOWES PUBLISHERS LIMITED
- ----------------------------------------------------------------------------------------------------------------------------------
 2 - The place within Canada where the registered office        Lieu au Canada ou doit etre situe le siege social
     is to be situated

     Hyde Park, Ontario.
- ----------------------------------------------------------------------------------------------------------------------------------
 3 - The classes and any maximum number of shares that the      Categories et tout nombre maximal d'actions que la societe
     corporation is authorized to issue                         est autorisee a emettre

     The authorized capital of the Corporation shall consist of One Million Ten Thousand (1,010,000) Common Shares.
- ----------------------------------------------------------------------------------------------------------------------------------
 4 - Restrictions if any on share transfers                     Restrictions sur le transfer des actions, s'il y a lieu

     See Schedule attached.
- ----------------------------------------------------------------------------------------------------------------------------------
 5 - Number (or minium and maximun number) of directors         Nombre (ou nombre minimum et maximum) d'administrateurs

     The number of directors of the Corporation shall consist of five (5) directors.
- ----------------------------------------------------------------------------------------------------------------------------------
 6 - Restriction if any on business the corporation may         Limites imposees quant aux activites que la societe peut
     carry on                                                   exploiter, s'il y a lieu

     There are no restrictions in these Articles on the business which the Corporation may carry on.
- ----------------------------------------------------------------------------------------------------------------------------------
 7 - Other provisions if any                                    Autres dispositions, s'il y a lieu

     See Schedule attached.
- ----------------------------------------------------------------------------------------------------------------------------------
 8 - The amalgamation agreement has been approved      / /      La convention de fusion a ete approuvee par resolutions speciales
     by special resolution of shareholders of each              des actionnaires de chacune des societes fusionnaires enumerees a
     of the amalgamating corporations listed in                 la rubrique 10 ci-dessous, en conformite de l'article 183 de la
     item 10 below in accordance with Section 183               Loi regissant les societes par actions de regime federal.
     of the Canada Business Corporations Act.

     The amalgamation has been approved by a           /X/      La fusion a ete approuvee par resolution des administrateurs de
     resolution of the directors of each of the                 chacune des societes fusionnantes enumerees a la rubrique 10
     amalgamating corporations listed in item 10                ci-dessous en conformite de l'article 184 de la Loi regissant les
     below in accordance with Section 184 of the                societes par actions de regime federal. Les presente statuts de
     Canada Business Corporations Act. These                    fusion sont les memes que les statuts constitutifs de
     articles of amalgamation are the same as                   (NOMMER LA SOCIETE FUSIONNANTE DESIGNEE).
     the articles of incorporation of (NAME THE
     DESIGNATED AMALGAMATING CORPORATION.)
- ----------------------------------------------------------------------------------------------------------------------------------
 9 - Name of the amalgamating Corporation the by-laws           Denomination de la societe fusionnante dont les reglements
     of which are to be the by-laws of the amalgamated          administratifs seront ceux de la societe issue de la fusion
     corporation

     BOWES PUBLISHERS LIMITED
- ----------------------------------------------------------------------------------------------------------------------------------
10 -  Name of Amalgamating Corporations         Corporation No.    Signature             Date           Description of Office
      Denomination des societes fusionnantes    No de la societe                                        Description du poste
- ----------------------------------------------------------------------------------------------------------------------------------
      BOWES PUBLISHERS LIMITED                      265704-0        /s/ William Dempsey   Dec. 28/1991       Director
                                                                        William Dempsey
- ----------------------------------------------------------------------------------------------------------------------------------
      SUMMERLAND PUBLISHING LTD.                    278074-7        /s/ William Dempsey   Dec. 28/1991       Director
                                                                        William Dempsey
- ----------------------------------------------------------------------------------------------------------------------------------
      COMMUNITY PRINTERS (1978) LTD.                278076-3        /s/ William Dempsey   Dec. 28/1991       Director
                                                                        William Dempsey
- ----------------------------------------------------------------------------------------------------------------------------------
      JAMES COMMUNICATIONS INC.                     278075-5        /s/ William Dempsey   Dec. 28/1991       Director
                                                                        William Dempsey
- ----------------------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------------------
 FOR DEPARTMENTAL USE ONLY - A L'USAGE DU MINISTERE SEULEMENT       Filed - Deposee
 Corporation No. - No. de la societe

     278070-4                                                      Dec. 23/1991
- ----------------------------------------------------------------------------------------------------------------------------------
CCA 1390 (02-89) 46                                       DYE & DURHAM CO. LIMITED






                                    SCHEDULE

                       to Form 9, Articles of Amalgamation
                           pursuant to Section 185 of
                        CANADA BUSINESS CORPORATIONS ACT

4.       RESTRICTIONS IF ANY ON SHARE TRANSFERS:

         No share of the capital stock of the Corporation shall be transferred
         without the previous sanction of the Board of Directors of the
         Corporation expressed by a resolution passed at a meeting of the Board
         of Directors or by an instrument or instruments in writing signed by
         all of the directors of the Corporation.

7.       OTHER PROVISIONS IF ANY:

         (a)      the number of shareholders of the Corporation shall be limited
                  to fifty (50), not including persons who are in the employment
                  of the Corporation and persons who, having been formally in
                  the employment of the Corporation, were, while in that
                  employment and have continued after the termination of that
                  employment to be, shareholders of the Corporation;

         (b)      any invitation to the public to subscribe to subscribe for
                  securities of the Corporation is prohibited.

         (c)      Without in any way limited the power conferred upon the
                  Corporation and its directors by the Canada Business
                  Corporations Act, the Board of Directors may, from time to
                  time, in such amounts and on such terms as it deems expedient,
                  charge, mortgage, hypothecate or pledge, or grant any form of
                  security interest in, all or any of the currently owned or
                  subsequently acquired, real or personal, moveable or
                  immoveable, property of the Corporation, including book debts,
                  rights, powers, franchises and undertaking, to secure any debt
                  obligations or any money borrowed or other debt or liability
                  of the Corporation.

                  The Board of Directors may from time to time delegate to such
one or more of the directors and officers of the Corporation as may be
designated by the Board all or any of the powers conferred on the Board above to
such extent and in such manner as the Board shall determine at the time of each
such delegation.






[LOGO]   Industry Canada            Industrie Canada





CERTIFICATE                                    CERTIFICAT
OF AMALGAMATION                                DE FUSION

CANADA BUSINESS                                LOI CANADIENNE SUR
CORPORATIONS ACT                               LES SOCIETES PAR ACTIONS








   BOWES PUBLISHERS LIMITED                                    310244-1
   -----------------------------------------------        --------------------
   Name of corporation - Denomination de la societe        Corporation number
                                                          Numero de la societe


   I hereby certify that the above-      Je certifie que la societe
   named corporation resulted from       susmentionnee est issue d'une fusion,
   an amalgamation, under section 185    en vertu de l'article 185 de la
   of the CANADA BUSINESS CORPORATIONS   LOI CANADIENNE SUR LES SOCIETES PAR
   ACT, of the corporations set out      ACTIONS, des societes dont les
   in the attached articles of           denominations apparaissent dans
   amalgamation.                         les statuts de fusion ci-joints.






   /s/ [illegible]                       December 31, 1994/le 31 decembre 1994
       Director - Directeur              Date of Amalgamation - Date de fusion





   [CANADA LOGO]





                                                                                     
[LOGO]                  Consumer and                          Consommation et
                        Corporate Affairs Canada              Affaires commerciales Canada

                                                                       FORM 9                     FORMULE 9
Canada Business         Loi regissant les societes            ARTICLES OF AMALGAMATION         STATUS DE FUSION
Corporations Act        par actions de regime federal               (SECTION 185)                (ARTICLE 185)
- ----------------------------------------------------------------------------------------------------------------------------------
 1 - Name of amalgamated corporation                            Denomination de la societe issue de la fusion

     BOWES PUBLISHERS LIMITED
- ----------------------------------------------------------------------------------------------------------------------------------
 2 - The place in Canada where the registered office            Lieu au Canada ou doit etre situe le siege social
     is to be situated

     London, Ontario
- ----------------------------------------------------------------------------------------------------------------------------------
 3 - The classes and any maximum number of shares that the      Categories et tout nombre maximal d'actions que la societe
     corporation is authorized to issue                         est autorisee a emettre

     The authorized capital of the Corporation shall consist of One Million Ten Thousand (1,010,000) Common Shares.
- ----------------------------------------------------------------------------------------------------------------------------------
 4 - Restrictions, if any, on share transfers                   Restrictions sur le transfer des actions, s'il y a lieu

     See Schedule Attached.
- ----------------------------------------------------------------------------------------------------------------------------------
 5 - Number (or minimum and maximum number) of directors        Nombre (ou nombre minimal et maximal) d'administrateurs

     The number of directors of the Corporation shall consist of five (5) directors.
- ----------------------------------------------------------------------------------------------------------------------------------
 6 - Restrictions, if any, on business the corporation may      Limites imposees a l'activite commerciale de la societe,
     carry on                                                   s'il y a lieu

     There are no restrictions in these Articles on the business which the Corporation may carry on.
- ----------------------------------------------------------------------------------------------------------------------------------
 7 - Other provisions if any                                    Autres dispositions, s'il y a lieu

     See Schedule Attached.
- ----------------------------------------------------------------------------------------------------------------------------------
 8 - The amalgamation has been approved pursuant                La fusion a ete approuvee en accord avec l'article ou le
     to that section or subsection of the Act                   paragraphe de la Loi indique ci-apres.
     which is indicated as follows:

                                          / / 183   / / 184(1)   /X/ 184(2)
- ----------------------------------------------------------------------------------------------------------------------------------
 9 -  Name of amalgamating corporations         Corporation No.    Signature                 Date             Title
      Denomination des societes fusionnantes    No de la societe                          D-J/M/Y-A           Titre
- ----------------------------------------------------------------------------------------------------------------------------------
      Bowes Publishers Limited                      278070-4        /s/ William Dempsey    21/12/94          Director
                                                                        William Dempsey
- ----------------------------------------------------------------------------------------------------------------------------------
      Bowes Realty Limited                          310243-2        /s/ William Dempsey    21/12/94          Director
                                                                        William Dempsey
- ----------------------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------------------------------------------------
 FOR DEPARTMENTAL USE ONLY - A L'USAGE DU MINISTERE SEULEMENT       Filed - Deposee
 Corporation number - Numero de la societe

     310244-1                                                       JAN - 4 1995
- ----------------------------------------------------------------------------------------------------------------------------------
                             HARRISON, ELWOOD, BARRISTERS AND SOLICITORS, LONDON, ONTARIO

style us corporation SoftDocs-Registration Trademark- 3.11/Toronto - Canada                                          STYLEUS 10/1993







                                    SCHEDULE

                       to Form 9, Articles of Amalgamation
                           pursuant to Section 185 of
                        CANADA BUSINESS CORPORATIONS ACT

4.       RESTRICTIONS IF ANY ON SHARE TRANSFERS:

         No share of the capital stock of the Corporation shall be transferred
         without the previous sanction of the Board of Directors of the
         Corporation expressed by a resolution passed at a meeting of the Board
         of Directors or by an instrument or instruments in writing signed by
         all of the directors of the Corporation.

7.       OTHER PROVISIONS IF ANY:

         (a)      the number of shareholders of the Corporation shall be limited
                  to fifty (50), not including persons who are in the employment
                  of the Corporation and persons who, having been formally in
                  the employment of the Corporation, were, while in that
                  employment and have continued after the termination of that
                  employment to be, shareholders of the Corporation;

         (b)      any invitation to the public to subscribe to subscribe for
                  securities of the Corporation is prohibited.

         (c)      Without in any way limited the power conferred upon the
                  Corporation and its directors by the Canada Business
                  Corporations Act, the Board of Directors may, from time to
                  time, in such amounts and on such terms as it deems expedient,
                  charge, mortgage, hypothecate or pledge, or grant any form of
                  security interest in, all or any of the currently owned or
                  subsequently acquired, real or personal, moveable or
                  immoveable, property of the Corporation, including book debts,
                  rights, powers, franchises and undertaking, to secure any debt
                  obligations or any money borrowed or other debt or liability
                  of the Corporation.

                  The Board of Directors may from time to time delegate to such
one or more of the directors and officers of the Corporation as may be
designated by the Board all or any of the powers conferred on the Board above to
such extent and in such manner as the Board shall determine at the time of each
such delegation.




[LOGO]   Industry Canada            Industrie Canada





CERTIFICATE                                    CERTIFICAT
OF AMALGAMATION                                DE FUSION

CANADA BUSINESS                                LOI CANADIENNE SUR
CORPORATIONS ACT                               LES SOCIETES PAR ACTIONS








   BOWES PUBLISHERS LIMITED                                    315262-6
   ------------------------------------------------       --------------------
   Name of corporation - Denomination de la societe        Corporation number -
                                                          Numero de la societe


   I hereby certify that the above-      Je certifie que la societe
   named corporation resulted from       susmentionnee est issue d'une fusion,
   an amalgamation, under section 185    en vertu de l'article 185 de la
   of the CANADA BUSINESS CORPORATIONS   LOI CANADIENNE SUR LES SOCIETES PAR
   ACT, of the corporations set out      ACTIONS, des societes dont les
   in the attached articles of           denominations apparaissent dans
   amalgamation.                         les statuts de fusion ci-joints.






   /s/ [illegible]                       June 1, 1995/le 1 juin 1995
       Director - Directeur              Date of Amalgamation - Date de fusion





   [CANADA LOGO]                         IC 3411 (ic-94) (cca 2140)





CONSUMER AND                                                              FORM 9
CORPORATE AFFAIRS CANADA                                ARTICLES OF AMALGAMATION
                                                                   (SECTION 185)
CANADA BUSINESS
CORPORATIONS ACT


- --------------------------------------------------------------------------------
1 - Name of Amalgamated Corporation

         BOWES PUBLISHERS LIMITED

- --------------------------------------------------------------------------------
2 - The place within Canada where the registered office is to be situated

         LONDON, ONTARIO

- --------------------------------------------------------------------------------
3 - The classes and any maximum number of shares that the corporation is
    authorized to issue

         THE AUTHORIZED CAPITAL OF THE CORPORATION SHALL CONSIST OF ONE MILLION
         TEN THOUSANDS (1,010,000) COMMON SHARES.

- --------------------------------------------------------------------------------
4 - Restrictions if any on share transfers

         SEE SCHEDULE ATTACHED.

- --------------------------------------------------------------------------------
5 - Number (or minimum and maximum number) of directors

         THE NUMBER OF DIRECTORS OF THE CORPORATION SHALL CONSIST OF FIVE (5)
         DIRECTORS.

- --------------------------------------------------------------------------------
6 - Restrictions if any on business the corporation may carry on

         THERE ARE NO RESTRICTIONS IN THESE ARTICLES ON THE BUSINESS WHICH THE
         CORPORATION MAY CARRY ON.

- --------------------------------------------------------------------------------
7 - Other provisions if any

         SEE SCHEDULE ATTACHED.



                                                                          Page 2
- --------------------------------------------------------------------------------
8 - The amalgamation agreement has been approved
         by special resolution of shareholders of each
         of the amalgamating corporations listed in
         item 10 below in accordance with Section 183
         of the Canada Business Corporations Act.                    -----------

         The amalgamation has been approved by a
         resolution of the directors of each of the
         amalgamating corporations listed in item 10
         below in accordance with Section 184 of the
         Canada Business Corporations Act. These
         articles of amalgamation are the same as
         the articles of incorporation of                               XXXXX
         BOWES PUBLISHERS LIMITED                                    -----------

- --------------------------------------------------------------------------------
9 - Name of the amalgamating Corporation the by-laws
    of which are to be the by-laws of the amalgamated corporation

         BOWES PUBLISHERS LIMITED

- --------------------------------------------------------------------------------
10 - Name of          Corporation     Signature      Date         Description of
    Amalgamating      No.                                         Office
    Corporations

- --------------------------------------------------------------------------------

B O W E S             3102441         /s/ [ILLEGIBLE]    1995/06/01    Director
PUBLISHERS
LIMITED

- --------------------------------------------------------------------------------

3 1 4 5 7 0 1         3145701         /s/ [ILLEGIBLE]    1995/06/01    Director
CANADA INC.

- --------------------------------------------------------------------------------
FOR DEPARTMENTAL USE ONLY
Corporation No.                                                            Filed

             315262-6                                                 Jun 2 1995
                                                                      Juin
- --------------------------------------------------------------------------------


G26\SINGERD\4073200.1




                                                                          Page 3

                                    SCHEDULE

                       to Form 9, Articles of Amalgamation
                           pursuant to Section 185 of
                        CANADA BUSINESS CORPORATIONS ACT

4.       RESTRICTIONS IF ANY ON SHARE TRANSFERS:

         No share of the capital stock of the Corporation shall be transferred
         without the previous sanction of the Board of Directors of the
         Corporation expressed by a resolution passed at a meeting of the Board
         of Directors or by an instrument or instruments in writing signed by
         all of the directors of the Corporation.

7.       OTHER PROVISIONS IF ANY:

         (a)      the number of shareholders of the Corporation shall be limited
                  to fifty (50), not including persons who are in the employment
                  of the Corporation and persons who, having been formerly in
                  the employment of the Corporation, were, while in that
                  employment and have continued after the termination of that
                  employment to be, shareholders of the Corporation;

         (b)      any invitation to the public to subscribe for securities of
                  the Corporation is prohibited.

         (c)      Without in any way limiting the power conferred upon the
                  Corporation and its directors by the CANADA BUSINESS
                  CORPORATIONS ACT, the Board of Directors may from time to
                  time, in such amounts and on such terms as it deems expedient,
                  charge, mortgage, hypothecate or pledge, or grant any form of
                  security interest in, all or any of the currently owned or
                  subsequently acquired, real or personal, moveable or
                  immoveable, property of the Corporation, including book debts,
                  rights, powers, franchises and undertaking, to secure any debt
                  obligations or any money borrowed or other debt or liability
                  of the Corporation.

                  The Board of Directors may from time to time delegate to such
one or more of the directors and officers of the Corporation as may be
designated by the Board all or any of the powers conferred on the Board above to
such extent and in such manner as the Board shall determine at the time of each
such delegation.






[LOGO]   Industry Canada            Industrie Canada





CERTIFICATE                                    CERTIFICAT
OF AMALGAMATION                                DE FUSION

CANADA BUSINESS                                LOI CANADIENNE SUR
CORPORATIONS ACT                               LES SOCIETES PAR ACTIONS








   BOWES PUBLISHERS LIMITED                                    324011-8
   ------------------------------------------------       ---------------------
   Name of corporation - Denomination de la societe        Corporation number -
                                                          Numero de la societe


   I hereby certify that the above-      Je certifie que la societe
   named corporation resulted from       susmentionnee est issue d'une fusion,
   an amalgamation, under section 185    en vertu de l'article 185 de la
   of the CANADA BUSINESS CORPORATIONS   LOI CANADIENNE SUR LES SOCIETES PAR
   ACT, of the corporations set out      ACTIONS, des societes dont les
   in the attached articles of           denominations apparaissent dans
   amalgamation.                         les statuts de fusion ci-joints.






   /s/ [illegible]                       March 18, 1996/le 18 mars 1996
       Director - Directeur              Date of Amalgamation - Date de fusion





   [CANADA LOGO]





CONSUMER AND                                                              FORM 9
CORPORATE AFFAIRS CANADA                                ARTICLES OF AMALGAMATION
                                                                   (SECTION 185)
CANADA BUSINESS
CORPORATIONS ACT


- --------------------------------------------------------------------------------
1 - Name of Amalgamated Corporation

         BOWES PUBLISHERS LIMITED

- --------------------------------------------------------------------------------
2 - The place within Canada where the registered office is to be situated

         LONDON, ONTARIO

- --------------------------------------------------------------------------------
3 - The classes and any maximum number of shares that the corporation is
    authorized to issue

         THE AUTHORIZED CAPITAL OF THE CORPORATION SHALL CONSIST OF ONE MILLION
         TEN THOUSANDS (1,010,000) COMMON SHARES.

- --------------------------------------------------------------------------------
4 - Restrictions if any on share transfers

         SEE SCHEDULE ATTACHED.

- --------------------------------------------------------------------------------
5 - Number (or minimum and maximum number) of directors

         THE NUMBER OF DIRECTORS OF THE CORPORATION SHALL CONSIST OF FIVE (5)
         DIRECTORS.

- --------------------------------------------------------------------------------
6 - Restrictions if any on business the corporation may carry on

         THERE ARE NO RESTRICTIONS IN THESE ARTICLES ON THE BUSINESS WHICH THE
         CORPORATION MAY CARRY ON.

- --------------------------------------------------------------------------------
7 - Other provisions if any

         SEE SCHEDULE ATTACHED.



                                                                          Page 2

- --------------------------------------------------------------------------------
8 - The amalgamation agreement has been approved
         by special resolution of shareholders of each
         of the amalgamating corporations listed in
         item 10 below in accordance with Section 183
         of the Canada Business Corporations Act.                    -----------

         The amalgamation has been approved by a
         resolution of the directors of each of the
         amalgamating corporations listed in item 10
         below in accordance with Section 184 of the
         Canada Business Corporations Act. These
         articles of amalgamation are the same as
         the articles of incorporation of                               XXXXX
         BOWES PUBLISHERS LIMITED                                    -----------

- --------------------------------------------------------------------------------
9 - Name of the amalgamating Corporation the by-laws
    of which are to be the by-laws of the amalgamated corporation

         BOWES PUBLISHERS LIMITED

- --------------------------------------------------------------------------------
10 - Name of          Corporation     Signature      Date         Description of
    Amalgamating      No.                                         Office
    Corporations

- --------------------------------------------------------------------------------

B O W E S             315262-6        /s/ [ILLEGIBLE]    1996/18/3    Director
PUBLISHERS
LIMITED

- --------------------------------------------------------------------------------

3 1 8 5 1 8 4         318518-4        /s/ [ILLEGIBLE]    1996/18/3    Director
CANADA INC.

- --------------------------------------------------------------------------------
FOR DEPARTMENTAL USE ONLY
Corporation No.                                                            Filed

             324011-8                                                MAR 19 1996

- --------------------------------------------------------------------------------




                                                                          Page 3

                                    SCHEDULE

                       to Form 9, Articles of Amalgamation
                           pursuant to Section 185 of
                        CANADA BUSINESS CORPORATIONS ACT

4.       RESTRICTIONS IF ANY ON SHARE TRANSFERS:

         No share of the capital stock of the Corporation shall be transferred
         without the previous sanction of the Board of Directors of the
         Corporation expressed by a resolution passed at a meeting of the Board
         of Directors or by an instrument or instruments in writing signed by
         all of the directors of the Corporation.

7.       OTHER PROVISIONS IF ANY:

         (a)      the number of shareholders of the Corporation shall be limited
                  to fifty (50), not including persons who are in the employment
                  of the Corporation and persons who, having been formerly in
                  the employment of the Corporation, were, while in that
                  employment and have continued after the termination of that
                  employment to be, shareholders of the Corporation;

         (b)      any invitation to the public to subscribe for securities of
                  the Corporation is prohibited.

         (c)      Without in any way limiting the power conferred upon the
                  Corporation and its directors by the CANADA BUSINESS
                  CORPORATIONS ACT, the Board of Directors may from time to
                  time, in such amounts and on such terms as it deems expedient,
                  charge, mortgage, hypothecate or pledge, or grant any form of
                  security interest in, all or any of the currently owned or
                  subsequently acquired, real or personal, moveable or
                  immoveable, property of the Corporation, including book debts,
                  rights, powers, franchises and undertaking, to secure any debt
                  obligations or any money borrowed or other debt or liability
                  of the Corporation.

                  The Board of Directors may from time to time delegate to such
one or more of the directors and officers of the Corporation as may be
designated by the Board all or any of the powers conferred on the Board above to
such extent and in such manner as the Board shall determine at the time of each
such delegation.





                                SUPPLEMENTARY

                                LETTERS PATENT

                                      TO

                            BOWES PUBLISHERS LIMITED




                     DATED     1st October, 1969.
                          ----------------------------------

                     RECORDED    17th October, 1969.
                             -------------------------------

                                  FILM   246   DOCUMENT  194
                                      --------         ------


                                      /s/ L. McCann
                            -----------------------------------
                            DEPUTY REGISTRAR GENERAL OF CANADA.



                                     [LOGO]

                                     CANADA

BY THE MINISTER OF CONSUMER AND CORPORATE AFFAIRS.

TO ALL TO WHOM THESE PRESENTS SHALL COME, OR WHOM THE SAME MAY IN ANYWISE
CONCERN,

                                                                       GREETING:

WHEREAS BOWES PUBLISHERS LIMITED (hereinafter referred to as "the Company") was
duly incorporated under the provisions of Part I of The Companies Act, 1934, by
letters patent dated the twenty-fifth (25th) day of September, one thousand nine
hundred and fifty (1950), with a capital stock consisting of one hundred (100)
Class A preferred shares of the par value of one hundred dollars ($100) each,
four hundred (400) Class B preferred shares of the par value of one hundred
dollars ($100) each and one hundred (100) common shares without nominal or par
value;

         AND WHEREAS the provisions of the said letters patent were amended by
the issue of supplementary letters patent dated the eighteenth (18th) day of
October, one thousand nine hundred and fifty-seven (1957), as a consequence of
which the presently authorized capital of the Company consists of one hundred
(100) Class A preferred shares of the par value of one hundred dollars ($100)
each, four hundred (400) Class B preferred shares of the par value of one
hundred dollars ($100) each, six hundred (600) Class C preferred shares of the
par value of one hundred dollars ($100) each and one hundred (100) common shares
without nominal or par value, provided, however, that the aggregate
consideration for the issue of the said one hundred (100) common shares without
nominal or par value shall not exceed in amount or value the sum of one



hundred dollars ($100) or such greater amount as the board of directors of the
Company may deem expedient and as may be authorized by the Minister of Consumer
and Corporate Affairs on payment of the requisite fees applicable to such
greater amount;

         AND WHEREAS the Company has applied by petition to the Minister of
Consumer and Corporate Affairs for the issue of supplementary letters patent
under the provisions of Part I of the Canada Corporations Act confirming By-law
No. 8 (as amended), which by-law was duly enacted by the directors and
sanctioned in the prescribed manner by the shareholders of the Company,
increasing the capital of the Company as hereinafter set forth;

         AND WHEREAS the Company has satisfactorily established the sufficiency
of all proceedings by the said Act required to be taken and the truth of all
facts by the said Act required to be established previous to the granting of
such supplementary letters patent;

         NOW KNOW YE that the Minister of Consumer and Corporate Affairs, by
virtue of the power vested in him by the said Act and of any other power or
authority whatever in him vested in this behalf, does by these supplementary
letters patent confirm the said By-law No. 8 (as amended) of the Company, duly
enacted and sanctioned as aforesaid, increasing the capital of the Company by
the creation of one thousand five hundred (1,500) Class D preferred shares of
the par value of one hundred dollars ($100) each, so that the authorized capital
of the Company shall consist of one hundred (100) Class A preferred shares of
the par value of one hundred dollars ($100) each, four hundred (400) Class B
preferred shares of the par value of one hundred dollars ($100) each, six
hundred (600) Class C preferred shares of the par value of one



hundred dollars ($100) each, one thousand five hundred (1,500) Class D preferred
shares of the par value of one hundred dollars ($100) each and one hundred (100)
common shares without nominal or par value, provided, however, that the
aggregate consideration for the issue of the said one hundred (100) common
shares without nominal or par value shall not exceed in amount or value the sum
of one hundred dollars ($100) or such greater amount as the board of directors
of the Company may deem expedient and as may be authorized by the Minister of
Consumer and Corporate Affairs on payment of the requisite fees applicable to
such greater amount, the said Class A preferred shares, the said Class B
preferred shares, the said Class C preferred shares and the said common shares
to carry and be subject to the rights, restrictions, conditions and limitations
set forth in supplementary letters patent granted to the Company under date the
said eighteenth (18th) day of October, one thousand nine hundred and fifty-seven
(1957), and the said Class D preferred shares to rank in priority to the said
common shares but subsequent to the Class A, Class B and Class C preferred
shares and to have attached thereto the following terms and conditions:

         "(a) The Class D preferred shares shall carry the right to a fixed
cumulative preferential dividend (preferential to the common shares but
subsequent to the rights of the holders of Class A, Class B and Class C
preferred shares) at the rate of five per cent (5%) per annum. The said dividend
shall accrue from the respective dates of issue of the said Class D preferred
shares and shall be payable in quarterly, semi-annual or annual installments, on
such date or dates as the directors may determine, at par at any branch in
Canada of the Company's bankers for the time being.




         (b) The Class D preferred shares shall carry the right on liquidation
or winding up of the Company to repayment of capital in priority to the common
shares, but subsequent to the Class A, Class B and Class C preferred shares, but
they shall not confer the right to any further participation in profits or
assets.

         (c) Pursuant to the provisions of section 49(3) of the Canada
Corporations Act, the said Class D preferred shares or any part thereof shall be
redeemable at par with thirty (30) days' notice at any time at the option of the
directors of the Company without the consent of the holders thereof and if less
than the whole amount of the outstanding Class D preferred shares shall be so
redeemed, the shares to be redeemed shall be selected by lot or PRO RATA in such
manner as the board of directors may determine. Not less than thirty (30) days'
notice of such redemption shall be given by mailing such notice in writing to
the registered holders of the shares to be redeemed, specifying the date and
place or places of redemption; if notice of any such redemption be given by the
Company in the manner aforesaid and an amount sufficient to redeem the shares be
deposited with any trust company or chartered bank as specified in the notice on
or before the date fixed for redemption, dividends on the Class D preferred
shares to be redeemed shall cease after the date so fixed for redemption and the
holders thereof shall thereafter have no rights against the Company in respect
thereof except, upon the surrender of certificates for such shares, to receive
payment therefor out of the moneys so deposited. The preferred shares so
redeemed shall be cancelled and the capital stock of the Company shall be
decreased accordingly upon due compliance with the provisions of section 62 of
the Canada Corporations Act.




         (d) The holders of the Class D preferred shares shall not have any
voting rights for the election of directors or for any other purpose nor shall
they be entitled to attend shareholders' meetings unless and until the Company
shall have failed for a period of two (2) years, consecutive or not, to pay any
dividend on the Class D preferred shares, whereupon and whenever the same shall
occur, the holders of the Class D preferred shares shall, until all arrears of
dividends have been paid on the Class D preferred shares, be entitled to attend
all shareholders' meetings and shall have one (1) vote thereat for each Class D
preferred share then held by them respectively."

         GIVEN under the seal of office of the Minister of Consumer and
Corporate Affairs at Ottawa this first day of October, one thousand nine hundred
and sixty-nine.

                                 /s/ [illegible]
                          for the Minister of Consumer
                              and Corporate Affairs.

[seal]





[LOGO]   Consumer and Corporate Affairs     Consommation et Corporations

         Canada Corporations Act            Loi canadienne sur les corporations

                                     CANADA

                          SUPPLEMENTARY LETTERS PATENT

                                    issued to

                            BOWES PUBLISHERS LIMITED

The Minister of Consumer and Corporate Affairs, by virtue of the power vested in
him by the Canada Corporations Act, does hereby confirm the alteration of the
capital of BOWES PUBLISHERS LIMITED as provided in By-law No. 11 of the said
Company, a copy of which is annexed hereto to form part of these presents.

Date of Supplementary Letters Patent - June 4, 1976.

GIVEN under the seal of office of the Minister of Consumer and Corporate Affairs

                                   /s/ [illegible]
                                   for the Minister of Consumer
                                   and Corporate Affairs.

                                   RECORDED 21st June, 1976
[seal]
                                   Film 404 Document 161

                                   /s/ L. McCann
                                   Deputy Registrar Central of Canada







                                  BY-LAW NO. 11

                             BEING A BY-LAW SUBDIVIDING
                             SHARES AND AUTHORIZING AN
                             APPLICATION FOR
                             SUPPLEMENTARY LETTERS PATENT

WHEREAS the authorized capital of the Company consists of one hundred (100)
Class A preferred shares of the par value of One hundred dollars ($100) each,
four hundred (400) Class B preferred shares of the par value of One hundred
dollars ($100) each, six hundred (600) Class C preferred shares of the par value
of One hundred dollars ($100) each, one thousand five hundred (1500) Class D
preferred shares of the par value of One hundred dollars ($100) each and one
hundred (100) common shares without nominal or par value; provided, however,
that the aggregate consideration for the issue of the said one hundred (100)
common shares without nominal or par value shall not exceed in amount or value
the sum of One hundred dollars ($100) or such greater amount as the board of
directors of the Company may deem expedient and as may be authorized by the
Minister of Consumer and Corporate Affairs on payment of the requisite fees
applicable to such greater amount, of which one hundred and ten (110) Class B
preferred shares, sixty (60) Class C preferred shares and all of the common
shares are presently issued and outstanding; and

WHEREAS it is deemed to be in the interest of the Company to obtain
supplementary letters patent confirming this by-law subdividing the shares of
the Company as herein provided;



NOW THEREFORE BE IT ENACTED as By-law No. 11 of BOWES PUBLISHERS LIMITED (herein
called the "Company") that:

1.   Subject to confirmation by supplementary letters patent the one hundred
(100) common shares without nominal or par value of the capital of the Company
be subdivided into one million (1,000,000) common shares without nominal or par
value.

2.   The Company be and is hereby authorized to make application to the
Minister of Consumer and Corporate Affairs for supplementary letters patent
confirming this By-law.

3.   The directors and officers be and are hereby authorized and directed to do,
sign and execute all things, deeds and documents necessary or desirable for the
due carrying out of the foregoing.

     ENACTED this 31st day of March 1976.

     WITNESS the corporate seal of the Company.

                                                                (corporate seal)

     "J.E. Bowes"                              "E.C. Elwood"
     -----------------------                   -----------------------
                   President                                 Secretary

Certified to be a true copy of By-law No. 11 of BOWES PUBLISHERS LIMITED duly
enacted on the 31st day of March 1976 at a meeting of the board of directors of
Bowes Publishers Limited, and subsequently sanctioned at a duly constituted
special general meeting of the shareholders of Bowes Publishers Limited held on
the 12th day of May 1976, which said By-law is in full force and effect at the
date hereof.

      Dated the 26th day of May 1976.

                                               /s/ Edward Cayley Elwood
                                               --------------------------------
                                               Edward Cayley Elwood - Secretary

EX-3.6

                                                                    Exhibit 3.6


                                                  THE ORIGINAL OF THIS DOCUMENT
                                                  WAS FILED AND REGISTERED WITH
                                                  THE REGISTRAR OF COMPANIES ON

                                                           JUL 03 2001






                                   SCHEDULE 2

                                    ARTICLES

                                       OF

                            BOWES PUBLISHERS LIMITED






                                TABLE OF CONTENTS
                                                                       
PART 1 - INTERPRETATION....................................................3

PART 2 - ISSUE OF SHARES...................................................3

PART 3 - SHARE CERTIFICATES................................................4

PART 4 - TRANSFER OF SHARES, GENERAL.......................................4

PART 5 - TRANSMISSION OF SHARES............................................5

PART 6 - BORROWING AND CAPITAL.............................................5

PART 7 - MEETINGS..........................................................6

PART 8 - PROCEEDINGS AT GENERAL MEETINGS...................................7

PART 9 - VOTES OF MEMBERS..................................................9

PART 10 - DIRECTORS.......................................................10

PART 11 - INDEMNIFICATION.................................................12

PART 12 - PROCEEDINGS OF DIRECTORS........................................14

PART 13 - OFFICERS........................................................15

PART 14 - EXECUTION OF INSTRUMENTS........................................16

PART 15 - DIVIDENDS.......................................................16

PART 16 - ACCOUNTS........................................................17

PART 17 - NOTICES.........................................................17

PART 18 - FEES............................................................18

PART 19 - TRANSFER OF SHARES. RESTRICTIONS................................18

PART 20 - SPECIAL RIGHTS AND RESTRICTIONS.................................19






                            PART 1 - INTERPRETATION

1.1  In these Articles, unless the context otherwise requires:

     (a)  "directors" means the director or directors of the Company for the
          time being;

     (b)  "Company Act" means the Company Act of the Province of British
          Columbia from time to time in force and all amendments thereto and all
          Regulations and amendments thereto made pursuant to that Act;

     (c)  "register" means the register of members to be kept pursuant to the
          Company Act;

     (d)  "registered address" of a member means his address as recorded in the
          register;

     (e)  "registered address" of a director means his address as recorded in
          the Company's register of directors to be kept at the records office
          of the Company pursuant to the Company Act.

1.2  Words importing the singular include the plural and vice versa, and words
     importing a male person include a female person and a corporation.

1.3  The definitions in the Company Act in force and as amended from time to
     time shall, with necessary changes and so far as applicable, apply to these
     Articles.

1.4  The regulations contained in Table A in the First Schedule to the Company
     Act shall not apply to the Company.


                            PART 2 - ISSUE OF SHARES

2.1  Subject to the Company Act and to these Articles, the issue of shares of
     the Company shall be under the control of the directors who may, subject to
     the rights of holders of shares of the Company for the time being
     outstanding, allot or otherwise dispose of, and/or grant options on, shares
     authorized but not yet issued at such times and to such persons, including
     directors, and in such manner and upon such terms and conditions and at
     such price or for such consideration as the directors in their absolute
     discretion may determine.

2.2  Whenever the Company is not a reporting company, the directors, before
     allotting any shares, shall first offer those shares pro rata to the
     members, but where there are classes of shares, the directors shall first
     offer the shares to be allotted pro rata to the members holding shares of
     the class proposed to be allotted, and, if any shares remain, the directors
     shall then offer the remaining shares pro rata to the other members. The
     offer shall be made by notice specifying the number of shares offered and
     the time, which shall be not less than seven days, for acceptance of the
     offer. After the expiration of the time for acceptance or on receipt of
     written confirmation from the person to whom such an offer is made that he
     declines to accept the offer, and where there are no other members holding
     shares who should first receive an offer, the directors may, for three
     months thereafter, offer shares to such persons and in such manner as they
     think most beneficial to the Company, but the offer to those persons shall
     not be at a price less than, or on terms more favourable than, the offer to
     the members. Whenever the Company is a reporting company, the directors may
     allot and issue its shares at such times and in such manner and to such
     persons or class of persons as the directors may determine and as the
     Company Act, the Securities Act, and all other applicable laws permit.

2.3  When the Company is authorized to issue shares without par value, the
     directors are authorized to determine the price or consideration for which
     such shares shall be allotted or issued, and notwithstanding that the price
     or


                                      -4-

     consideration for a share may be other than cash, the price or
     consideration for a share shall, at the time when the share is allotted, be
     expressed in terms of money and so recorded in the proceedings of the
     directors of the Company.

2.4  No share shall be issued until the Company has received the full
     consideration therefore in cash, property, or services, provided that:

     (a)  a document or book account evidencing indebtedness of the allottee
          does not constitute property;

     (b)  services shall be past services actually performed for the Company;
          and,

     (c)  the value of property or services shall be the value the directors
          determine by resolution to be, in all the circumstances of the
          transaction, the fair market value.

2.5  Subject to the provisions and restrictions contained in the Company Act
     applicable to the shares without par value or otherwise, the Company may
     pay a commission or allow a discount in an amount not exceeding 25% of the
     amount of the subscription price to any person in consideration of his
     subscribing or agreeing to subscribe, or procuring or agreeing to procure
     subscriptions, whether absolutely or conditionally for shares. The Company
     may pay such brokerage as may be lawful.


                          PART 3 - SHARE CERTIFICATES

3.1  Every share certificate issued by the Company shall be in such form as the
     directors approve and shall comply with the requirements of the Company
     Act.

3.2  If any share certificate is worn out or defaced, then upon production of
     that certificate to the directors or the transfer agent of the Company, the
     directors or that transfer agent may declare the same to be cancelled and
     cause it to be so marked and may issue a new certificate in place of the
     certificate cancelled. If any share certificate is lost or destroyed, then,
     upon proof of the loss or destruction to the satisfaction of the directors,
     and upon giving such indemnity as the directors deem adequate, a new
     certificate shall be issued to the party entitled to it. In any such case
     where a new share certificate is issued, the fee prescribed in Part 18 of
     these Articles must be paid if requested.

3.3  A share certificate registered in the names of two or more persons shall be
     delivered to the person first named on the register.


                      PART 4 - TRANSFER OF SHARES, GENERAL

4.1  Subject to the restrictions, if any, set forth in these Articles, any
     member may transfer his shares by instrument in writing executed by or on
     behalf of such member and delivered to the Company or its transfer agent.
     The instrument of transfer of any share of the Company shall be in the
     form, if any, on the back of the certificate of the share being
     transferred, or in any other form which the directors may approve. If the
     directors so require, each instrument of transfer shall be in respect of
     only one class of shares.

4.2  Every instrument of transfer shall be executed by the transferor and left
     at the registered office of the Company or at an authorized office of its
     transfer agent for registration, together with the certificate for the
     shares to be transferred and such other evidence, if any, as the directors
     or the transfer agent may require to prove the title of the transferor or
     his right to transfer the shares. All instruments of transfer which are
     registered shall be retained by the Company or its transfer agent, but any
     instrument of transfer where the transfer is not registered shall be
     returned to the person depositing the same, together with the share
     certificate which accompanied the same


                                      -5-

     when tendered for registration. The transferor shall remain the holder of
     the share until the name of the transferee is entered on the register in
     respect of that share.

4.3  The signature of the registered owner of any shares, or of his duly
     authorized attorney, upon the form of transfer constitutes an authority to
     the Company to register the shares specified in the form of transfer in the
     name of the person named in that form as transferee or, if no person is so
     named, then in any name designated in writing by the person depositing the
     share certificate and the form of transfer with the Company or its agents.
     The Company or its transfer agent may require proof or guarantee of the
     signature of any transferor.

4.4  Neither the Company nor any director, officer or agent is bound to enquire
     into the title of the transferee of shares to be transferred, nor is any
     such person liable to the registered or any intermediate owner of the
     shares for registering the transfer.

4.5  The Company may keep its register of members either at its records office
     or at any office in the Province of British Columbia of a trust company
     registered under the Trust Company Act, and may keep, or cause to be kept
     within the Province by a trust company registered as aforesaid, one or more
     branch registers of members.

4.6  Whenever the Company is a reporting company, but not otherwise, it may
     cause one or more branch registers of members to be kept outside the
     Province of British Columbia.


                        PART 5 - TRANSMISSION OF SHARES


5.1  In the case of the death or bankruptcy of a member, his personal
     representative or trustee in bankruptcy shall be the only person recognized
     by the Company as having any title to or interest in the shares registered
     in the name of the deceased. Before recognizing any personal representative
     or trustee in bankruptcy the directors may require him to produce and
     deposit the documents required by the Company Act.

5.2  Notwithstanding anything otherwise provided in these Articles, if a person
     becomes entitled to a share as a result of an order of a Court of competent
     jurisdiction or pursuant to a statute, then, upon producing such evidence
     as the directors think sufficient that he is so entitled, such person may
     be registered as holder of the share.


                         PART 6 - BORROWING AND CAPITAL

6.1  Subject to any restriction which may from time to time be included in the
     memorandum of the Company or these Articles or contained in the Company Act
     or the terms, rights or restrictions of any shares or securities of the
     Company outstanding, the directors may at their discretion authorize the
     Company to borrow any sum of money and may raise or secure the repayment of
     such sum in such manner and upon such terms and conditions, in all
     respects, as they think fit, and in particular, and without limiting the
     generality of the foregoing, by the issue of bonds or debentures, or any
     mortgage or charge, whether specific or floating, or by granting any other
     security on the undertaking, or the whole or any part of the property, of
     the Company, both present and future.

6.2  The directors may make any debentures, bonds or other debt obligations
     issued by the Company, by their terms assignable free from any equities
     between the Company and the person to whom they may be issued or any other
     person who lawfully acquires the same by assignment, purchase, or
     otherwise, howsoever.

6.3  The directors may authorize the issue of any debentures, bonds or other
     debt obligations of the Company at a discount, premium or otherwise, and
     with special or other rights or privileges as to redemption, surrender,
     entitlement to interest or share of income, allotment of, or conversion
     into,


                                      -6-

     or exchange for shares, attendance at general meetings of the Company, and
     otherwise as the directors may determine at or before the time of issue,
     but no debenture shall be issued which the Company has not the power to
     reissue until the members by resolution determine such debenture shall be
     cancelled unless such debenture expressly provides by its terms that it
     shall not be reissued. The Company may cause one or more branch registers
     of its debenture holders to be kept.

6.4  The Company by ordinary resolution of the members and insofar as the
     Company Act shall permit, may alter its memorandum to increase its
     authorized capital by:

     (a)  creating shares with par value, or shares without par value, or both;

     (b)  increasing the number of shares with par value, or shares without par
          value, or both;

     (c)  increasing the par value of a class of shares with par value, if no
          shares of that class are issued; or

     (d)  creating shares of different classes with special rights or
          restrictions.

6.5  The Company may, by resolution of the directors and subject to the
     provisions of the Company Act and the specific provisions of any special
     rights or restrictions attached to any class or classes of its shares,
     purchase or otherwise acquire any of its shares if, at the time of the
     proposed purchase or acquisition the Company is not insolvent or likely to
     be rendered insolvent by such purchase or acquisition and if, where a
     proposed purchase of shares is not to be made through a stock exchange, the
     Company shall make its offer to purchase pro rata to every member who holds
     shares of the class or kind to be purchased unless the Company is
     purchasing shares from a dissenting member pursuant to the Company Act.

6.6  The Company may, by resolution of the directors and subject to the
     provisions of the Company Act and the specific provisions of any special
     rights or restrictions attached to any class or classes of its shares by
     the Memorandum or these Articles, redeem any of its issued shares that have
     a right of redemption attached thereto provided that at the time of such
     redemption the Company is not insolvent or likely to be rendered insolvent
     by such redemption and where the Company proposes to redeem some, but not
     all, of its shares of a particular class or kind, the directors shall have
     absolute discretion to determine in such manner as they deem proper which
     shares shall be redeemed, and, without limiting the generality of the
     foregoing, may redeem shares which have been purchased by the Company in
     priority to shares which are held by members.

6.7  The banking business of the Company, or any part thereof, shall be
     transacted with such bank, trust company or other firm or body corporate as
     the board may designate, appoint or authorize from time to time and all
     such banking business, or part thereof, shall be transacted on the
     Company's behalf by such one or more officers or other persons as the board
     may designate, direct or authorize from time to time and to the extent
     thereby provided.


                               PART 7 - MEETINGS

7.1  Meetings of the Company shall be held at such time and place, in accordance
     with the Company Act, as the directors appoint, and, unless otherwise
     specifically provided, the provisions of these Articles relating to
     meetings shall apply with necessary changes to a meeting of members holding
     a particular class of shares.

7.2  Every meeting, other than an annual general meeting or a class meeting,
     shall be called an extraordinary general meeting.


                                      -7-

7.3  The directors may, whenever they think fit, convene an extraordinary
     general meeting.

7.4  Notice of a meeting shall be given not less than 21 days and not more than
     50 days prior to the date of the meeting and shall specify the place, the
     day and the hour of meeting, and, in case of special business, the general
     nature of that business. The accidental omission to give notice of any
     meeting to, or the non-receipt of any notice by, any of the members
     entitled to receive notice, shall not invalidate any proceedings at that
     meeting.

7.5  If any special business includes presenting, considering, approving,
     ratifying or authorizing the execution of any document, then the portion of
     any notice relating to that document is sufficient if it states that a copy
     of the document or proposed document is or will be available for inspection
     by members at an office of the Company in the Province of British Columbia
     or at one or more designated places in the Province during business hours
     on any specified or unspecified business day or days prior to the date of
     the meeting, and at the meeting.

7.6  Meetings of members shall be held at the registered office of the Company
     or elsewhere in the municipality in which the registered office is situate
     or, if the board shall so determine, at some other place in Canada or, if
     all members entitled to vote at the meeting agree, at some place outside
     Canada, and a member who attends a meeting outside Canada is deemed to have
     so agreed except when he attends such meeting for the express purpose of
     objecting to the transaction of any business on the grounds that the
     meeting is not lawfully held.

7.7  The Company shall prepare a list of members entitled to receive notice of
     meetings, arranged in alphabetical order and showing the number of shares
     entitled to be voted at the meeting held by each member. The list shall be
     available for examination by any member during usual business hours at the
     registered office of the Company or at the place where the securities
     register is kept and at the place where the meeting is held.


                    PART 8 - PROCEEDINGS AT GENERAL MEETINGS

8.1  The following business at a general meeting shall be deemed to be special
     business:

     (a)  All business at an extraordinary general meeting;

     (b)  All business that is transacted at an annual general meeting, with the
          exception of the consideration of the financial statements and the
          report of the directors and auditors, the election of directors, the
          appointment of the auditors and such other business as, under these
          Articles or in accordance with the Company Act, ought to be transacted
          at an annual general meeting or is business which is brought under
          consideration by the report of the directors issued with the notice
          convening the meeting;

     and no special business shall be conducted at any meeting unless notice of
     that business has been given to the members in accordance with these
     Articles or members holding at least 75% of the shares entitled to be
     voted at that meeting are present and consent to the conduct of such
     business.

8.2  No business, other than the election of a chairman and the adjournment or
     termination of the meeting, shall be conducted at any meeting at any time
     when a quorum is not present. A quorum shall be two persons holding or
     representing by proxy not less than one-half of the outstanding shares of
     the Company which are entitled to be voted at the meeting, unless the
     Company has only one member, in which case the quorum shall be that member
     who may conduct the business of the Company by proceedings recorded in
     writing and signed by him. If at any time during a meeting there ceases to
     be a quorum present, any business then in progress shall be suspended
     until there is a quorum present or until the meeting is adjourned or
     terminated, as the case may be.


                                      -8-

8.3  If within 30 minutes from the time appointed for a meeting a quorum is not
     present, the meeting, if convened upon the requisition of members, shall be
     terminated. In any other case, it shall stand adjourned to the same day in
     the next week, at the same time and place, and if, at the adjourned
     meeting, a quorum is not present within half an hour from the time
     appointed for the meeting, the member or members present shall be a quorum.

8.4  Subject to Article 8.5, the chairman of the directors, if there is one,
     failing whom the president of the Company, failing whom one of the
     directors present chosen by the directors from among their number, shall
     preside as chairman of every meeting.

8.5  If at any general meeting there is no chairman or president or director
     present within 15 minutes after the time appointed for holding the meeting,
     or if the chairman or president and all the directors present are unwilling
     to act as chairman, the members present shall choose someone of their
     number to be chairman.

8.6  The chairman of a meeting may, with the consent of any meeting at which a
     quorum is present, and shall, if so directed by the meeting, adjourn the
     meeting from time to time and from place to place, but no business shall be
     transacted at any adjourned meeting other than the business left unfinished
     at the meeting from which the adjournment took place. When a meeting is
     adjourned for 30 days or more, notice of the adjourned meeting shall be
     given as in the case of the original meeting. Except as aforesaid, it is
     not necessary to give any notice of an adjournment or of the business to be
     transacted at an adjourned meeting.

8.7  No resolution proposed at a meeting need be seconded, and the chairman of
     any meeting is entitled to move or propose a resolution.

8.8  In case of an equality of votes either on a show of hands or on a poll, the
     chairman shall have a casting or second vote in addition to the vote or
     votes to which he may be entitled as a member, which vote or votes he is
     entitled to cast without vacating the chair.

8.9  In the case of any dispute as to the admission or rejection of a proxy or a
     vote, the chairman shall determine the same and his determination, made in
     good faith, is final and conclusive.

8.10 A member entitled to more than one vote need not, if he votes, use all his
     votes or cast all the votes he uses in the same way.

8.11 Subject to these Articles, if a poll is duly demanded it shall be taken in
     such manner as the chairman directs within seven days of the demand for the
     same. The result of the poll shall be deemed to be the resolution of the
     meeting at which the poll is demanded. A demand for a poll may be withdrawn
     at any time before it has been taken.

8.12 A poll demanded on a question of adjournment shall be taken at the meeting
     without adjournment.

8.13 The demand for a poll shall not, unless the chairman so rules, prevent the
     continuance of a meeting for the transaction of any business other than the
     question on which a poll has been demanded or questions which depend or
     bear upon that question.

8.14 Subject always to any contrary or specific provision of the Company Act, a
     resolution that has been submitted to all of the members who would have
     been entitled to vote thereon in person or by proxy at a meeting and that
     has been consented to in writing by such members holding not less than 75%
     of the shares of the Company shall be deemed to be an ordinary resolution
     passed at a meeting.


                                      -9-

8.15 Subject always to any contrary or specific provision of the Company Act, a
     resolution consented to in writing by every member of the Company who would
     have been entitled to vote thereon in person or by proxy at a meeting shall
     be deemed to be a special resolution passed at a meeting.

8.16 Subject always to the provisions of the Company Act, whenever the Company
     is not a reporting company, where all the members entitled to attend and
     vote at the annual general meeting of the Company consent in writing to all
     the business required to be transacted at the meeting, it is not necessary
     for the Company to hold that annual general meeting.

8.17 The only persons entitled to be present at a meeting of members shall be
     those entitled to vote thereat, the directors and the auditor of the
     Company and others who, although not entitled to vote, are entitled or
     required under any provision of the Company Act or the articles to be
     present at the meeting. Any other person may be admitted only on the
     invitation of the chairman of the meeting or with the consent of the
     meeting.


                           PART 9 - VOTES OF MEMBERS

9.1  Subject to any rights or restrictions for the time being attached to any
     class or classes of shares, on a show of hands every member over the age of
     eighteen years present in person or by proxy has one vote, and on a poll
     every such member present in person or by proxy has one vote for each share
     he holds on the record date except that no member which is a corporation
     which is a subsidiary of the Company shall be entitled to vote its shares
     of the Company, and the Company itself shall not vote in respect of any
     share of the Company that it has redeemed purchased, or otherwise acquired.

9.2  Any person who is not registered as a member but who is entitled to vote at
     any meeting in respect of a share, may vote the share in the same manner as
     if he were a member, but, unless the directors have previously admitted his
     right to vote at that meeting in respect of the share, if so required by
     any director he shall satisfy the directors of his right to vote the share
     before the time for holding the meeting, or adjourned meeting, as the case
     may be, at which he proposes to vote.

9.3  Where there are joint members registered in respect of any share, any one
     of the joint members may vote at any meeting, either personally or by
     proxy, in respect of the share as if he were solely entitled to it. If more
     than one of the joint members is present at any meeting, personally or by
     proxy, the joint member present whose name stands first on the register in
     respect of the share shall alone be entitled to vote in respect of that
     share. Several executors or administrators of a deceased member in whose
     sole name any share stands shall, for the purposes of this Article, be
     deemed joint members.

9.4  Subject to the provisions of the Company Act, a corporation which is a
     member and is not a subsidiary of the Company may vote by up to two duly
     authorized representatives, who are entitled to speak and vote, either in
     person or by proxy, and in all other respects exercise the rights of a
     member and those representatives shall be reckoned as a member for all
     purposes in connection with any meeting of the Company.

9.5  A member for whom a committee has been duly appointed may vote, whether on
     a show of hands or on a poll, by his committee and that committee may
     appoint a proxyholder.

9.6  Unless the directors otherwise determine, the instrument appointing a
     proxyholder and the power of attorney or other authority, if any, under
     which it is signed, or a notarially certified copy thereof, shall be
     deposited at a place specified for that purpose in the notice convening the
     meeting, not less than 48 hours before the time for holding the meeting at
     which the proxyholder proposes to vote, or, if no such place is specified,
     then it shall be deposited with the chairman of the meeting prior to the
     commencement of the meeting.


                                      -10-

9.7  A vote given in accordance with the terms of an instrument of proxy is
     valid notwithstanding the previous death or incapability of the member, or
     revocation of the proxy, or of the authority under which the proxy was
     executed, or the transfer of the share in respect of which the proxy is
     given, if, but only if, no prior notice in writing of the death,
     incapability, revocation or transfer has been received at the registered
     office of the Company or by the chairmen of the meeting or adjourned
     meeting before the vote is given.

9.8  An instrument appointing a proxyholder, whether for a specified meeting or
     otherwise, shall be, subject to the requirements of the Company Act, in the
     form approved by the directors.

9.9  A proxy or an instrument appointing a duly authorized representative of a
     corporation shall be in writing, under the hand of the appointor or of his
     attorney duly authorized in writing, or, if such appointor is a
     corporation, either under its seal or under the hand of an officer or
     attorney duly authorized.

9.10 Any person may act as a proxyholder whether or not he is entitled on his
     own behalf to be present and to vote at the meeting at which he acts as
     proxyholder.

9.11 The directors may fix in advance a date, preceding the date of any meeting
     of members by not more than 50 days and not less than 21 days, as a record
     for the determination of the members entitled to notice of the meeting,
     provided that notice of any such record date is given, not less than 14
     days before such record date, by newspaper advertisement in the place where
     the registered office of the Company is situate. If no record date is so
     fixed, the record date for the determination of the members entitled to
     receive notice of the meeting shall be at the close of business on the day
     immediately preceding the day on which the notice is given or, if no notice
     is given, the day on which the meeting is held.


                              PART 10 - DIRECTORS

10.1 The directors named in the Instrument of Continuation at the coming into
     force of these Articles, shall be the directors of the Company unless and
     until such person:

     (a)  dies;

     (b)  resigns in writing;

     (c)  is no longer qualified in accordance with these Articles or the
          Company Act; or

     (d)  is removed from office by ordinary resolution of the members.

10.2 The management of the business of the Company shall be vested in the
     directors and the directors may exercise all such powers and do all such
     acts and things as the Company may exercise and do which are not by these
     Articles or by the Company Act or otherwise lawfully directed or required
     to be exercised or done by the Company in general meeting, but subject,
     nevertheless, to the provisions of all laws affecting the Company and of
     these Articles and to any rules, not being inconsistent with these Articles
     which are made from time to time by the Company in general meeting,
     provided that no rule made by the Company in general meeting shall
     invalidate any prior act of the directors that would have been valid if
     that rule had not been made.

10.3 The number of directors shall be at least one as long as the Company is not
     a reporting company, and shall be at least three whenever the Company is a
     reporting company, and no more than 25. Subject to the foregoing, the
     number of directors may be determined from time to time by resolution of
     the members, and provided that the number of directors holding office shall
     not fall below the minimum numbers above mentioned, the number of directors
     shall be automatically


                                      -11-

     reduced upon the death, resignation, removal or disqualification of any
     director and automatically increased upon the appointment of any additional
     director or directors in accordance with these Articles.

10.4 A director is not required to hold a share of the Company as qualification
     to be a director, but in order to be qualified he must not be:

     (a)  under the age of 18 years; or,

     (b)  found to be incapable of managing his own affairs by reason of mental
          infirmity; or,

     (c)  a corporation; or,

     (d)  an undischarged bankrupt; or,

     (e)  unless the Supreme Court of British Columbia orders otherwise,
          convicted within or without the Province of British Columbia of an
          offence

          (i)  in connection with the promotion, formation, or management of a
               corporation; or,

          (ii) involving fraud,

          unless five years have elapsed since the expiration of the period
          fixed for suspension of the passing of sentence without sentencing, or
          since a fine was imposed, or the term of imprisonment and probation
          imposed, if any, was concluded, whichever is the latest, but the
          disability imposed by this clause ceases upon a pardon being granted
          under the Criminal Records Act (Canada);

     and every director must not be subject to any other disqualifications as to
     office according to the Company Act, provided always that no person who is
     not ordinarily resident in Canada shall be appointed a director of the
     Company if, upon his appointment, the majority of the directors of the
     Company would not be persons ordinarily resident in Canada.

10.5 In the event of the death, resignation, removal or disqualification of a
     director and his consequent vacating of office in accordance with these
     Articles or the Company Act in circumstances in which the majority of the
     directors of the Company would thereafter not be persons ordinarily
     resident in Canada, then the last appointed director who is not ordinarily
     resident in Canada shall, ipso facto, be disqualified from office and be no
     longer a director of the Company. In the event there are on the happening
     of such an event two or more persons who are not ordinarily resident in
     Canada who were last appointed and appointed at the same time, then the
     Secretary shall determine by lot which of the two or more so last appointed
     shall have ceased to hold office by reason of this paragraph. Subject to
     the foregoing, if a casual vacancy should occur in the board, the remaining
     directors if constituting a quorum may appoint a qualified person to fill
     the vacancy for the remainder of the term. Where a vacancy or vacancies
     exist on the board, the remaining directors may exercise all of the powers
     of the board so long as a quorum remains in office.

10.6 If the Company removes any director by ordinary resolution, it may by
     ordinary resolution, appoint another person in his stead.

10.7 Any person not being a member of the Company who becomes a director shall
     be deemed to have agreed to be bound by the provisions of the Articles to
     the same extent as if he were a member of the Company.


                                      -12-

10.8  Subject to the provisions of any ordinary resolution, the remuneration of
      the directors as such may from time to time be determined by the directors
      themselves, and such remuneration may be in addition to any salary or
      other remuneration paid to any officer or employee of the Company as such,
      who is also a director. The directors shall be repaid such reasonable
      expenses as they may incur in and about the business of the Company, and
      if any director shall perform any professional or other services for the
      Company that are outside the ordinary duties of a director, or shall
      otherwise be specifically occupied in or about the Company's business, he
      may be paid a special remuneration to be fixed by the directors in
      addition to any other remuneration that he may be entitled to receive and
      the same shall be charged as part of the ordinary working expenses. Unless
      otherwise determined by ordinary resolution, the directors on behalf of
      the Company may pay a gratuity or pension or allowance on retirement to
      any person who has held any office of employment with the Company or to
      his spouse or dependants and may make contributions under any plan or to
      any fund and pay premiums for the purchase or provision of any such
      gratuity, benefit, pension or allowance.

10.9  The directors may from time to time and at any time by power of attorney
      appoint any company, firm or person or body of persons to be the attorney
      or attorneys of the Company for such purposes and with such powers,
      authorities and discretion, not exceeding those vested in or exercisable
      by the directors under these Articles, and for such period, and subject to
      such conditions, as they may think fit.

10.10 A director who is in any way directly or indirectly interested in a
      proposed contract or transaction with the Company shall disclose the
      nature and extent of his interest at a meeting of the directors in
      accordance with the provisions of the Company Act. A director shall not
      vote in respect of any contract or transaction with the Company in which
      he is interested, and if he shall do so his vote shall not be counted, but
      he may be counted in the quorum present at the meeting at which such vote
      is taken.

10.11 A director may hold any office or place of profit under the Company other
      than auditor, for such period, and on such terms as to remuneration or
      otherwise, as the directors may determine. Subject to compliance with the
      Company Act, no director shall be disqualified by his office from
      contracting with the Company either with regard to his tenure of any
      office or place of profit or as vendor, purchaser or otherwise.

10.12 Any director may act by himself or his firm in any professional capacity
      for the Company except as auditor, and he or his firm shall be entitled to
      remuneration for professional services as if he were not a director.

10.13 At each annual general meeting of the Company all the directors shall
      retire from office, but are eligible for re-election and the members shall
      by ordinary resolution elect a board of directors consisting of the number
      of directors so retiring or determined by resolution or recommendation of
      the directors. If in any calendar year the Company does not hold an annual
      general meeting the directors then in office shall be deemed to have been
      elected as directors on the last day on which the meeting should have been
      held pursuant to the Company Act, and the directors so elected may hold
      office until other directors are appointed or elected or until the day on
      which the next annual general meeting is held.


                           PART 11 - INDEMNIFICATION

11.1  The Company shall indemnify any director, officer, employee or agent of
      the Company who was or is a party or is threatened to be made a party to
      any threatened, pending or completed action or proceeding and whether
      civil, criminal or administrative, by reason of the fact that he is or was
      a director, officer, employee, or agent of the Company or any act or thing
      occurring at a time when he is or was serving at the request of the
      Company as a director, officer, employee or agent of another corporation,
      partnership, joint venture, trust or other enterprise, against all costs,
      charges and expenses, including legal fees and any amount paid to settle
      the action or


                                      -13-

      proceeding or satisfy a judgment, if he acted honestly and in good faith
      with a view to the best interests of the corporation or other legal entity
      or enterprise as aforesaid of which he is or was a director, officer,
      employee or agent, as the case may be, and exercised the care, diligence
      and skill of a reasonably prudent person, and with respect to any criminal
      or administrative action or proceeding, he had reasonable ground for
      believing that his conduct was lawful; provided that no indemnification of
      a director or former director of the Company, or director or former
      director of a corporation in which the Company is or was a shareholder,
      shall be made except to the extent approved by the Court pursuant to the
      Company Act or any other statute. The determination of any action, suit or
      proceeding by judgment, order, settlement, conviction or otherwise shall
      not, of itself, create a presumption that the person did not act honestly
      and in good faith and in the best interests of the Company and did not
      exercise the care, diligence and skill of a reasonably prudent person and,
      with respect to any criminal action or proceeding, did not have reasonable
      grounds to believe that his conduct was lawful.

11.2  The Company shall indemnify any person in respect of any loss, damage,
      costs or expenses whatsoever incurred by him while acting as an officer,
      employee or agent for the Company unless such loss, damage, costs or
      expenses shall arise out of failure to comply with instructions, wilful
      act or default or fraud by such person, in any of which events the Company
      shall only indemnify such person if the directors, in their absolute
      discretion, so decide or the Company by ordinary resolution shall so
      direct.

11.3  The indemnification provided by this Article shall not be deemed exclusive
      of any other rights to which those seeking indemnification may be entitled
      under any other Article, or any valid and lawful agreement, vote of
      members or disinterested directors or otherwise, both as to action in his
      official capacity and as to action in another capacity while holding such
      office, and shall continue as to a person who has ceased to be a director,
      officer, employee or agent and shall entire to the benefit of the heirs,
      executors and administrators of such person The indemnification provided
      by this Article shall not be exclusive of any powers, rights, agreements
      or undertakings which may be legally permissible or authorized by or under
      any applicable law. Notwithstanding any other provisions set forth in this
      Article, the indemnification authorized by this Article shall be
      applicable only to the extent that any such indemnification shall not
      duplicate indemnity or reimbursement which that person has received or
      shall receive otherwise than under this Part.

11.4  The directors are authorized from time to time to cause the Company to
      give indemnities to any director, officer, employee, agent or other person
      who has undertaken or is about to undertake any liability on behalf of the
      Company or any corporation controlled by it.

11.5  Subject to the Company Act, no director or officer or employee for the
      time being of the Company shall be liable for the acts, receipts, neglects
      or defaults of any other director or officer or employee, or for joining
      in any receipt or act for conformity, or for any loss, damage or expense
      happening to the Company through the insufficiency or deficiency of title
      to any property acquired by order of the Board for the Company, or for the
      insufficiency or deficiency of any security in or upon which any of the
      moneys of or belonging to the Company shall be invested or for any loss or
      damages arising from the bankruptcy, insolvency, or tortious act of any
      person, firm or corporation with whom or which any moneys, securities or
      effects shall be lodged or deposited or for any loss occasioned by any
      error of judgment or oversight on his part or for any other loss, damage
      or misfortune whatever which may happen in the execution of the duties of
      his respective office or trust or in relation thereto unless the same
      shall happen by or through his own wilful act or default, negligence,
      breach of trust or breach of duty.

11.6  Directors may rely upon the accuracy of any statement of fact represented
      by an officer of the Company to be correct or upon statements in a written
      report of the auditor of the Company and shall not be responsible or held
      liable for any loss or damage resulting from the paying of any dividends
      or otherwise acting in good faith upon any such statement.


                                      -14-

11.7  The directors may cause the Company to purchase and maintain insurance for
      the benefit of any person who is or was a director, officer, employee or
      agent of the Company or is or was serving at the request of the Company as
      a director, officer, employee or agent of another corporation,
      partnership, joint venture, trust or other enterprise against any
      liability incurred by him as a director, officer, employee or agent.


                      PART 12 - PROCEEDINGS OF DIRECTORS

12.1  Notice of the time and place of each meeting of the board shall be given
      to each director not less than 48 hours before the time when the meeting
      is to be held. A notice of meeting of directors need not specify the
      purpose of or business to be transacted at the meeting except where the
      Company Act requires such purpose or business to be specified. The
      directors, when there is more than one, may meet together at such places
      as they think fit for the dispatch of business, adjourn and otherwise
      regulate their meetings and proceedings as they see fit.

12.2  The quorum shall be a majority of the directors then in office, and when
      an even number of directors are holding office, shall be one more than
      half of their number.

12.3  Unless and until the directors shall elect one of their number to be
      chairman of the board of directors, the president of the Company shall be
      chairman of all meetings of the directors; but if at any meeting a
      chairman elected by the directors or the president is not present within
      30 minutes after the time appointed for holding the meeting, the directors
      present may choose someone of their number to be chairman at that meeting.

12.4  Any director may waive notice of any meeting of directors. Accidental
      omission to give notice of a meeting of directors to, or non-receipt of
      notice by, any director, shall not invalidate the proceedings of any
      meeting of the directors.

12.5  Provided a quorum of directors is present, each newly elected board may
      without notice hold its first meeting following the meeting of members at
      which such board is elected. Notice of an adjourned meeting of the board
      is not required if the time and place of the adjourned meeting is
      announced at the original meeting.

12.6  Except as provided in the Company Act, the Directors may participate in a
      meeting of the Directors by means of telephone or other communications
      facilities that permit all Directors participating in the meeting to
      communicate with each other. A meeting so held in accordance with this
      Article shall be deemed to be an actual meeting of the board and any
      resolution passed at such meeting shall be as valid and effectual as if it
      had been passed at a meeting where the Directors are physically present. A
      Director participating in a meeting in accordance with this Article shall
      be deemed to be present at the meeting and to have so agreed and shall be
      counted in the quorum therefore and be entitled to participate in and vote
      thereat.

12.7  The directors, or any committee of directors, may take any action required
      or permitted to be taken by them and may exercise all or any of the
      authorities, powers and discretion for the time being vested in or
      exercisable by them by resolution either passed at a meeting at which a
      quorum is present and at which a majority of the directors present are
      resident Canadians or authorized by resolution consented to in writing
      signed by all the directors in accordance with the Company Act. The board
      may transact business at a meeting of directors where a majority of
      resident Canadian directors is not present if a resident Canadian director
      who is unable to be present approves in writing or by telephone or other
      communications facilities the business transacted at the meeting, and a
      majority of Canadian resident directors would have been present had that
      director been present at the meeting.

12.8  The directors may delegate any, but not all, of their powers to committees
      consisting of such director or directors as they think fit. Any committee
      so formed in the exercise of the powers so


                                      -15-

      delegated shall conform to any rules that may from time to time be imposed
      on it by the directors, and shall report every act or thing done in
      exercise of those powers to the first meeting of the directors held after
      it has been done.

12.9  A committee of more than one director may elect a chairman of its meetings
      and if no chairman is elected, or if at any meeting the chairman is not
      present within 30 minutes after the time appointed for holding the
      meeting, the directors present who are members of the committee may choose
      one of their number to be chairman of the meeting.

12.10 The member or members of a committee may govern their procedure as they
      think proper, subject to any rules imposed by the directors. Each
      committee shall have the power to fix its quorum at not less than a
      majority of its members. Questions arising shall be determined by the
      member, if there be only one, or by a majority of votes of the members
      present, but in case of an equality of votes the chairman of a committee
      shall not have a second or casting vote.

12.11 Any director of the Company who may be absent from the Province of British
      Columbia may file at the registered office of the Company by letter or
      facsimile a waiver of notice of any meeting of the directors and may, at
      any time and by one of the means mentioned aforesaid, withdraw the waiver,
      but until the waiver is withdrawn, no notice of meetings of directors need
      be sent to that director, and any and all meetings of the directors of the
      Company held after receipt of such waiver and held prior to its withdrawal
      shall, provided a quorum of the directors is present, be valid and
      effective without notice of such meeting given to that director.

12.12 Questions arising at any meeting of the directors shall be decided by a
      majority of votes. In case of an equality of votes, the chairman shall
      have a second or casting vote.

12.13 No resolution proposed at a meeting of directors need be seconded, and the
      chairman of any meeting is entitled to move or propose and vote upon a
      resolution of the directors.

12.14 All acts done by any meeting of the directors or by a committee of
      directors or by any person acting as a director shall, notwithstanding
      that it shall be afterwards discovered that there was some defect in the
      appointment of any such director or person acting as aforesaid, or that
      they or any of them were disqualified be as valid as if every such person
      had been duly appointed and was qualified to be a director.


                               PART 13 - OFFICERS

13.1  The Company shall have a president and a secretary whom the directors
      shall appoint. The President must be a director of the Company. Except
      when the Company has only one member, the President and Secretary shall be
      different persons. Subject to the foregoing, the board may from time to
      time appoint such other officers as the board may determine.

13.2  All appointments of officers shall be made at such remuneration, whether
      by way of salary, fee, commission, participation in profits, or otherwise,
      as the directors think fit, and every appointment of an officer by the
      directors shall be in force until revoked by the directors or until the
      death or resignation in writing of the officer unless otherwise provided
      in the resolution of appointment.

13.3  Every officer of the Company who holds any office or possesses any
      property whereby, whether directly or indirectly, duties or interests
      might be created in conflict with his duties or interests as an officer of
      the Company shall, in writing, disclose to the President the fact and the
      nature, character and extent of the conflict.


                                      -16-

                       PART 14 - EXECUTION OF INSTRUMENTS

14.1  The Secretary or any other officer or any director may sign certificates
      and similar instruments (other than share certificates) on the Company's
      behalf with respect to any factual matters relating to the Company's
      business affairs, including certificates verifying copies of the articles,
      by-laws, resolutions and minutes of meetings of the Company. Subject to
      the foregoing, deeds, transfers, assignments, contracts, obligations,
      certificates and other instruments shall be signed on behalf of the
      Company by two persons, one of whom holds the office of Chairman of the
      Board, President, Managing Director, Vice-President or director and the
      other of whom holds one of the said offices or the office of Secretary,
      Treasurer, Assistant Secretary or Assistant Treasurer or any other office
      created by by-law or by resolution of the board. In addition, the board
      may from time to time direct the manner in which and the person or persons
      by whom any particular instrument or class of instruments may or shall be
      signed.

14.2  The directors may, but shall not be required to, provide a common seal for
      the Company. They shall have power from time to time to destroy the same
      or substitute a new seal in place of the seal destroyed or to cause the
      affairs of the Company to be conducted without a common seal. In the event
      a seal is provided, then unless otherwise provided by the directors, the
      same may be affixed to any document by the signing officers designated in
      Article 14.1.

14.3  Subject to the provisions of the Company Act, the directors may provide
      for use in any other province, state, territory or country an official
      seal, which shall be a facsimile of the common seal of the Company, with
      the addition on its face of the name of the province, state, territory or
      country where it is to be used.

14.4  The signature of any officer of the Company may be printed, lithographed,
      engraved or otherwise mechanically reproduced upon all instruments
      executed or issued by the Company or any officer thereof; and, subject to
      the Company Act, any instrument on which the signature of any such person
      is so reproduced, shall be deemed to have been manually signed by such
      person whose signature is so reproduced and shall be as valid to all
      intents and purposes as if such instrument had been signed manually, and
      notwithstanding that the person whose signature is so reproduced may have
      ceased to hold office at the date of the delivery or issue of such
      instrument. The term "instrument" as used in this Article shall include
      all paper and electronic writings.


                              PART 15 - DIVIDENDS

15.1  The directors may declare dividends and fix the date of record therefore
      and the date for payment thereof, provided that the record date may
      precede the payment date by not more than 50 days and notice of such
      record date is given not less than 14 days before such record date by
      advertisement in a newspaper published or distributed in the place where
      the Company has its registered office. If no record date is fixed then the
      record date shall be the close of business on the day on which the
      resolution relating to such dividend is passed by the board.

15.2  Subject to the terms of shares with special rights or restrictions, all
      dividends shall be declared according to the number of shares held.

15.3  Dividends may only be payable out of the profits of the Company. No
      dividend shall bear interest against the Company. A transfer of a share
      shall not pass the right to any dividend thereon before the registration
      of the transfer in the register.

15.4  A resolution declaring a dividend may direct payment of the dividend
      wholly or partly by the distribution of specific assets or of paid-up
      shares, bonds, debentures or other debt obligations of the Company, or in
      any one or more of those ways, and, where any difficulty arises in regard
      to the distribution, the directors may settle the same as they think
      expedient, and in particular may fix the value for distribution of
      specific assets, and may determine that cash payments shall be




                                      -17-

      made to a member upon the basis of the value so fixed in place of
      fractional shares, bonds, debentures or other debt obligations in order to
      adjust the rights of all parties, and may vest any of those specific
      assets in trustees upon such trusts for the persons entitled as may seem
      expedient to the directors.

15.5  Any dividend or other moneys payable in cash in respect of a share may be
      paid by cheque sent through the post to the member in a prepaid letter,
      envelope or wrapper addressed to the member at his registered address, or
      in the case of joint members, to the registered address of the joint
      member who is the first named on the register, or to such person and to
      such address as the member or joint members, as the case may be, in
      writing direct. Any one of two or more joint members may give effectual
      receipts for any dividend or other moneys payable or assets distributable
      in respect of a share held by them.

15.6  No notice of the declaration of a dividend need be given to any member.

15.7  The directors may, before declaring any dividend, set aside out of the
      profits of the Company such sums as they think proper as a reserve or
      reserves which shall, at the discretion of the directors, be applicable
      for meeting contingencies, or for equalizing dividends, or for any other
      purpose to which the profits of the Company may be properly applied, and
      pending that application may, at the like discretion, either be employed
      in the business of the Company or be invested in such investments, as the
      directors may from time to time think fit, including shares of the Company
      purchased or acquired in accordance with these Articles.

15.8  The directors may capitalize any undistributed surplus on hand of the
      Company and may from time to time issue as fully paid and non-assessable
      any unissued shares or any bonds, debentures or other debt obligations of
      the Company as a dividend representing such undistributed surplus on hand
      or any part thereof.

15.9  Should any dividend result in any shareholder being entitled to a
      fractional share, the directors shall have the right to pay such
      shareholders the cash equivalent of such fractional part, and shall have
      the further right to carry out such distribution and to adjust the rights
      of the shareholders with respect thereto on as practical and equitable a
      basis as possible.

15.10 Any dividend unclaimed after a period of six years from the date on which
      the same has been declared to be payable shall be forfeited and shall
      revert to the Company.


                               PART 16 - ACCOUNTS

16.1  The directors shall cause records and books of accounts to be kept as
      necessary to record properly the financial affairs and conditions of the
      Company and to comply with the provisions of the Company Act and all
      statutes applicable to the Company.

16.2  The fiscal period of the Company shall terminate on such day in each year
      as the Board of Directors may from time to time, by resolution, determine.


                               PART 17 - NOTICES

17.1  A notice may be given to any member or director, either by personal
      service or by sending it by post to him in a letter, envelope or wrapper
      or by facsimile addressed to the member or director at his registered
      address or in any manner approved by the directors and not prohibited by
      the Company Act.

17.2  A notice may be given by the Company to joint members in respect of a
      share registered in their names by giving the notice to the joint member
      first named in the register of members in respect of that share.



                                      -18-

17.3  A notice may be given by the Company to the persons entitled to a share in
      consequence of the death or bankruptcy of a member by sending it through
      the post in a prepaid letter, envelope or wrapper addressed to them by
      name, or by the title of representatives of the deceased or trustee of the
      bankrupt, or by any like description, at the address, if any, supplied for
      the purpose by the persons claiming to be so entitled, or, until that
      address has been so supplied, by giving the notice in any manner in which
      the same might have been given if the death or bankruptcy had not
      occurred.

17.4  Any notice or document sent by post to, or left at, the registered address
      of any member, shall, notwithstanding that member is then deceased, and
      whether or not the Company has notice of his death, be deemed to have been
      duly served in respect of any registered shares, whether held solely or
      jointly with other persons by that deceased member, until some other
      person is registered in his stead as the member or joint member in respect
      of those shares, and that service shall for all purposes of these Articles
      be deemed a sufficient service of such notice or document on his personal
      representatives and all persons, if any, jointly interested with him in
      those shares.

17.5  Any notice sent by post shall be deemed to have been served on the second
      day following that on which the letter, envelope or wrapper containing the
      same is posted exclusive of any day upon which the mail is not regularly
      delivered or handled in either the place of posting or the place of
      delivery, and in proving service it is sufficient to prove that the
      letter, envelope or wrapper containing the notice was properly addressed
      and put in a Canadian government post office, postage prepaid, subject
      always to it being proved by the person to whom the notice was addressed
      that the mail was not regularly delivered or handled as aforesaid on or
      between the day of posting and the day of delivery.

17.6  Notice of every general meeting shall be given in the manner hereinbefore
      authorized to:

      (a)   every member holding a share or shares carrying the right to vote at
            such meetings on the record date or, if no record date was
            established by the directors, on the date of personal service or
            mailing;

      (b)   every person upon whom the ownership of a share has devolved by
            reason of his being a legal personal representative or a trustee in
            bankruptcy of a member where the member, but for his death or
            bankruptcy, would be entitled to receive notice of the meeting; and

      (c)   the auditor of the Company.

      Subject to any provisions in any instrument of the Company or in the
      special rights or restrictions attached to any shares, no other person is
      entitled to receive notice of general meetings.


                                 PART 18 - FEES

18.1  The Company may charge the following fee to issue a new certificate in
      exchange for an existing certificate or a defaced or worn out certificate
      or to replace a lost or destroyed certificate:

      Per new certificate: $1.00


                   PART 19 - TRANSFER OF SHARES. RESTRICTIONS

19.1  A share or shares in the Company may be transferred by an instrument of
      transfer and in accordance with these Articles by any member, or the
      personal representative of any deceased member or the trustee in
      bankruptcy of any bankrupt member or by the liquidator of any member which
      is a corporation, only with the approval of a resolution of the directors.



                                      -19-

19.2  Notwithstanding anything otherwise provided in these Articles, the
      directors may, in their absolute discretion, refuse to allow and decline
      to register any transfer of shares to any person, even if the foregoing
      conditions and other provisions of these Articles are complied with, and
      the directors shall not be bound or required to disclose their reasons for
      any such refusal to anyone.

19.3  The number of members of the Company shall be limited to 50, not including
      persons who are in the employment of the Company and persons who, having
      been formerly in the employment of the Company were, while in that
      employment and have continued after the termination of that employment to
      be, shareholders of the Company.

19.4  Any invitation to the public to subscribe for securities of the Company is
      prohibited.


                   PART 20 - SPECIAL RIGHTS AND RESTRICTIONS

CLASS A COMMON SHARES

20.1  The holders of the Class A Common Shares shall be entitled to one vote for
      each such share so held at all meetings of members.

20.2  Subject the rights of the holders of any Class B Preferred Shares
      established by series, the directors shall be at liberty in their absolute
      discretion to declare dividends on any one or more class or classes of the
      Class A Common Shares or the Class B Preferred Shares to the exclusion of
      the other.

20.3  Subject to the rights of holders of any Class B Preferred Shares
      established by series, in the event of the liquidation, dissolution or
      wind-up of the Company, whether voluntary or involuntary, the holders of
      the Class A Common Shares shall be entitled to participate on a pro rata
      basis in the distribution of the remaining assets of the Company.

CLASS B PREFERRED SHARES

20.4  Class B Preferred Shares may be issued by the directors in one or more
      series, and the directors may, from time to time, by resolution passed:

      (a)   alter the Memorandum of the Company to fix the number of shares in,
            and to determine the designation of the shares of, each series; and

      (b)   alter the Memorandum or the Articles of the Company to create,
            define and attach special rights and restrictions to the shares of
            each series, subject to the special rights and restrictions attached
            to the shares of the Class, including without in any way limiting or
            restricting the generality of the foregoing, the following:

            (i)   the rate, amount or method of calculation of dividends, if
                  any, and whether the same are subject to adjustments;

            (ii)  whether such dividends are cumulative, partly cumulative or
                  non-cumulative;

            (iii) the dates, manner and currency of payments of dividends and
                  the dates from which dividends accrue or become payable;

            (iv)  if redeemable or purchasable, the redemption or purchase
                  prices and the terms and conditions of redemption or purchase,
                  with or without provision for sinking or similar funds;

            (v)   any conversion, exchange or reclassification rights; and



                                      -20-

            (vi)  any other rights, privileges, restrictions and conditions not
                  inconsistent with these provisions.

20.5  The Class B Preferred Shares of each series shall, with respect to the
      payment of dividends and the distribution of assets in the event of the
      liquidation, dissolution or winding-up of the Company, whether voluntary
      or involuntary, or any other distribution of the assets of the Company
      among its members for the purpose of winding-up its affairs, rank on a
      parity with the Class B Preferred Shares of every other series and be
      entitled to a preference over the Class A Common Shares and any other
      class ranking junior to the Class B Preferred Shares. The Class B
      Preferred Shares of any series shall also be entitled to such other
      preferences, not inconsistent with these provisions, over the Class A
      Common Shares and the shares of any other class ranking junior to the
      Class B Preferred Shares, as may be fixed in accordance with Article 20.4.

20.6  The approval of the holders of Class B Preferred Shares as a class, as to
      any matters referred to in these provisions or required by law may be
      given as specified below:

      (a)   any approval given by the holders of the Class B Preferred Shares
            shall be deemed to have been sufficiently given if it shall have
            been given in writing by the holders of all of the outstanding Class
            B Preferred Shares or by a resolution passed at a meeting of holders
            of Class B Preferred Shares duly called and held for such purpose
            upon not less than 21 days' notice at which the holders of at least
            a majority of the outstanding Class B Preferred Shares are present
            or are represented by proxy and carried by the affirmative vote of
            not less than 75% of the votes cast at such meeting. If at any such
            meeting the holders of a majority of the outstanding Class B
            Preferred Shares are not present or represented by proxy within
            one-half hour after the time appointed for such meeting, then the
            meeting shall be adjourned to such date not less than 15 days
            thereafter and to such time and place as may be designated by the
            chairman of the meeting and not less than ten days' written notice
            shall be given of such adjourned meeting but it shall not be
            necessary in such notice to specify the purpose for which the
            meeting was originally called. At such adjournment meeting the
            holders of Class B Preferred Shares present or represented by proxy
            shall form a quorum and may transact the business for which the
            meeting was originally called and a resolution passed thereat by the
            affirmative vote of not less than 75% of the votes cast at such
            meeting shall constitute the approval of the holders of the Class B
            Preferred Shares; and

      (b)   on every poll taken at any such meeting each holder of Class B
            Preferred Shares shall be entitled to one vote in respect of each
            Class B Preferred Share held. Subject to the foregoing, the
            formalities to be observed with respect to the giving or waiving of
            notice of any such meeting and the conduct thereof shall be those
            from time to time prescribed in the Company Act and the Articles of
            the Company with respect to meetings of shareholders.

20.7  Except as otherwise provided in the Company Act or these provisions, the
      holders of Class B Preferred Shares shall not, as such, be entitled to
      receive notice of, or attend or vote at, any meeting of the members of the
      Company.

EX-3.7

                                                                Exhibit 3.7


[GRAPHIC]



                                COMPANY ACT








I HEREBY CERTIFY THAT the documents annexed hereto and relating to SUN MEDIA
(TORONTO) CORPORATION are true copies of the documents on file with the
Registrar of Companies.




GRAPHIC                                ISSUED UNDER MY HAND AND SEAL OF OFFICE
                                            AT VICTORIA, BRITISH COLUMBIA
                                                  ON FEBRUARY 3, 2003


                                                        [SIGNATURE]


                                                       JOHN S. POWELL
                                                   Registrar of Companies
                                               PROVINCE OF BRITISH COLUMBIA
                                                           CANADA





                                   DUPLICATE


[GRAPHICS]                                                    NUMBER: C-658494




                                   CERTIFICATE
                                       OF
                                   CONTINUATION


                                   COMPANY ACT







I HEREBY CERTIFY THAT SUN MEDIA (TORONTO) CORPORATION, which was incorporated
under the laws of Ontario, has this day been granted a Certificate of
Continuation under the COMPANY ACT.






[SEAL]                     ISSUED UNDER MY HAND AT VICTORIA, BRITISH COLUMBIA,
                                            ON NOVEMBER 13, 2002


                                                [SIGNATURE]


                                                JOHN S. POWELL
                                            REGISTRAR OF COMPANIES
                                         PROVINCE OF BRITISH COLUMBIA
                                                    CANADA








[LOGO]                       Mailing Address:
                             PO Box 9431 Stn Prov Govt
                             Victoria BC  V8W 9V3

                             Location:
Ministry of Finance          2nd Floor - 940 Blanshard Street
Corporate and Personal       Victoria BC
Property Registries
                             Telephone: 250 387-2700


                 INSTRUMENT OF CONTINUATION
                  (Section 36 COMPANY ACT)
                          FORM 23

FREEDOM OF INFORMATION AND PROTECTION OF PRIVACY ACT (FIPPA)
The personal information requested on this form is made available to the
public under the authority of the COMPANY ACT. Questions about how the FIPPA
applies to this personal information can be directed to the Administrative
Analyst. Corporate and Personal Property Registries at 250 356-0944. PO Box
9431 Stn Prov Govt, Victoria BC V8W 9V3.

Additional information and forms are available on the internet at:
www.fin.gov.bc.ca/registries

1.  Full name of corporation

    SUN MEDIA (TORONTO) CORPORATION

2.  Date of incorporation or amalgamation

    YYYY/MM/DD
    2002/03/28

3.  Current jurisdiction of incorporation

    Business Corporations Act (Ontario)

4.  List the charter documents of the corporation - ATTACH COPIES, VERIFIED
    BY THE PROPER GOVERNMENT AUTHORITY IN THE COMPANY'S CURRENT JURISDICTION.
    PLEASE REFER TO INSTRUCTIONS FOR DEFINITION AND REQUIREMENTS FOR
    VERIFYING CHARTER DOCUMENTS.

    DATE OF DOCUMENT     NATURE OF DOCUMENT
    ----------------     ------------------
      YYYY/MM/DD
      2002/03/28         Certificate and Articles of amalgamation

      YYYY/MM/DD
      2002/03/28         By-law No. 1: General by-laws

5.  Full names and residential addresses of all directors of the corporation




LAST NAME       FIRST NAME AND INITIALS (IF ANY)      RESIDENTIAL ADDRESS            CITY             PROV.       POSTAL CODE
- ---------       --------------------------------      -------------------            ----             -----       -----------
                                                                                                   
Francoeur       Pierre                                177 Chamonix Street            Ste-Adele        QC          J0R 1L0
Lee             Kin-Man                               96 Pathlane Road               Richmond Hill    ON          L4B 4C7
Pyette          Lester                                792 Wellington Street          London           ON          N6A 3S3
Roper           Thomas A.                             4036 28th West Avenue          Vancouver        BC          V6S 1S8

                                                                                            FILED AND REGISTERED
                                                                                                NOV 13 2002
                                                                                           REGISTRAR OF COMPANIES





6.   Full names and residential addresses of all officers of the corporation.




LAST NAME      FIRST NAME AND INITIALS (IF ANY)   OFFICE HELD       RESIDENTIAL ADDRESS    CITY              PROV.     POSTAL CODE
- ---------      --------------------------------   -----------       -------------------    ----              -----     -----------
                                                                                                     
Francoeur      Pierre                             President & CEO   177 Chamonix Street    Ste-Adele         QC        J0R 1L0
Jamieson       John                               VP-Finance        783 Millbank Road      Pickering         ON        L1V 3L6
Lee            Kin-Man                            VP, Corp.         50 Kanata Crescent     London            ON        N6J 4S6
                                                  Controller
Menicucci      Piero                              Treasurer         1065 Victoria Park     Toronto           ON        M4B 2G7
                                                                    Avenue, Apt. 302
Pyette         Lester                             CEO, The          792 Wellington Street  London            ON        N6A 3S3
                                                  Toronto Sun
Rendle         Nancy                              Director of       55 Charles Street      Toronto           ON        M5S 2W9
                                                  Finance           West, Apt. 301
Saint-Arnaud   Louis                              Secretary         1291 Noiseaux Street   Mont St-Hilaire   QC        J3G 4S6
Tremblay       Claudine                           Assistant-        101 des Passereaux      Verdun            QC        H3E 1X3
                                                  Secretary         Street


7.   Is the corporation a reporting company as defined by the British
     Columbia COMPANY ACT (See Definitions)  / / Yes     /x/ No

8.   The corporation hereby adopts the memorandum and articles drawn pursuant
     to the British Columbia COMPANY ACT. These are appended hereto as
     schedules 1 and 2 and initialled for identification by an officer or
     director.


WITNESS

In witness whereof, the seal of the corporation was affixed.

SIGNATURE OF DIRECTOR OR OFFICER                 DATE SIGNED
- --------------------------------                 -----------
                                                 YYYY/MM/DD
Louis Saint-Arnaud                               2002/11/11


AFFIDAVIT

NAME OF CORPORATION
- -------------------
SUN MEDIA (TORONTO) CORPORATION

I Louis Saint-Arnaud,
  -------------------------, solemnly declare that the information contained
  NAME OF DIRECTOR OR OFFICER (must be same person who signed above)

in this statement is true and correct and I make this solemn declaration
conscientiously believing it to be true, and knowing that it is of the same
force and effect as if made under oath and by virtue of the CANADA EVIDENCE
ACT.

Declared before me Lilian O'Neill at Montreal, Quebec
                   -------------     -----------------

    YYYY/MM/DD
on  2002/11/11

Declared before a notary public or Commissioner for Oaths and Affidavits



NAME OF NOTARY PUBLIC OR COMMISSIONER  SIGNATURE OF NOTARY PUBLIC OR COMMISSIONER
- -------------------------------------  ------------------------------------------
                                    
Lilian O'Neill                        (Signature)           #88 983



ADDRESS OF NOTARY PUBLIC OR COMMISSIONER
- ----------------------------------------
3233, Chantal, Laval (Quebec) H7P 4B5



                                  SCHEDULE 1
                                  ----------

                                  COMPANY ACT

                                  MEMORANDUM


1.   The name of the company is SUN MEDIA (TORONTO) CORPORATION

2.   The authorized capital of the company consists of Thirty Billion
     (30,000,000,000) shares divided into:

     (a)  Ten Billion (10,000,000,000) Class A Common Shares without par value;

     (b)  Ten Billion (10,000,000,000) Class B Preferred Shares without par
          value; and

     (c)  Ten Billion (10,000,000,000) Class C Preferred Shares without par
          value.





                                  SCHEDULE 2
                                  ----------

                                   ARTICLES
                                      OF
                       SUN MEDIA (TORONTO) CORPORATION




                             TABLE OF CONTENTS
                             -----------------

PART 1 - INTERPRETATION ..................................................  1
PART 2 - ISSUE OF SHARES .................................................  1
PART 3 - SHARE CERTIFICATES ..............................................  2
PART 4 - TRANSFER OF SHARES, GENERAL .....................................  3
PART 5 - TRANSMISSION OF SHARES ..........................................  3
PART 6 - BORROWING AND CAPITAL ...........................................  4
PART 7 - MEETINGS ........................................................  5
PART 8 - PROCEEDINGS AT GENERAL MEETINGS .................................  6
PART 9 - VOTES OF MEMBERS ................................................  8
PART 10 - DIRECTORS ......................................................  9
PART 11 - INDEMNIFICATION ................................................ 12
PART 12 - PROCEEDINGS OF DIRECTORS ....................................... 14
PART 13 - OFFICERS ....................................................... 15
PART 14 - EXECUTION OF INSTRUMENTS ....................................... 17
PART 15 - DIVIDENDS ...................................................... 18
PART 16 - ACCOUNTS ....................................................... 19
PART 17 - NOTICES ........................................................ 19
PART 18 - FEES ........................................................... 20
PART 19 - TRANSFER OF SHARES. RESTRICTIONS ............................... 20
PART 20 - SPECIAL RIGHTS AND RESTRICTIONS ................................ 21





                            PART 1 - INTERPRETATION

1.1   In these Articles, unless the context otherwise requires:

      (a)  "directors" means the director or directors of the Company for the
           time being;

      (b)  "Company Act" means the Company Act of the Province of British
           Columbia from time to time in force and all amendments thereto and
           all Regulations and amendments thereto made pursuant to that Act;

      (c)  "register" means the register of members to be kept pursuant 1:0 to
           the Company Act;

      (d)  "registered address" of a member means his address as recorded in
           the register;

      (e)  "registered address" of a director means his address as recorded
           in the Company's register of directors to be kept at the records
           office of the Company pursuant to the Company Act.

1.2   Words importing the singular include the plural and vice versa, and
      words importing a male person include a female person and a corporation.

1.3   The definitions in the Company Act in force and as amended from time to
      time shall, with necessary changes and so far as applicable,
      apply to these Articles.

1.4   The regulations contained in Table A in the First Schedule to the
      Company Act shall not apply to the Company.


                           PART 2 - ISSUE OF SHARES

2.1   Subject to the Company Act and to these Articles, the issue of shares
      of the Company shall be under the control of the directors who may,
      subject to the rights of holders of shares of the Company for the time
      being outstanding, allot or otherwise dispose of, and/or grant options
      on, shares authorized but not yet issued at such times and to such
      persons, including directors, and in such manner and upon such terms
      and conditions and at such price or for such consideration as the
      directors in their absolute discretion may determine.

2.2   Whenever the Company is not a reporting company, the directors, before
      allotting any shares, shall first offer those shares pro rata to the
      members, but where there are classes of shares, the directors shall
      first offer the shares to be allotted pro rata to the members holding
      shares of the class proposed to be allotted, and, if any shares remain,
      the directors shall then offer the remaining shares pro rata to the
      other members. The offer shall be made by notice specifying the number
      of shares offered and the time, which shall be not less than seven
      days, for acceptance of the offer. After the expiration of the time for
      acceptance or on receipt of written confirmation from the person to
      whom such an offer is made that he declines to accept the offer, and
      where there are no other members holding shares who should first
      receive an offer, the directors may, for three months thereafter,
      offer shares to





                                    - 2 -


      such persons and in such manner as they think most beneficial to the
      Company, but the offer to those persons shall not be at a price less
      than, or on terms more favourable than, the offer to the members.
      Whenever the Company is a reporting company, the directors may allot and
      issue its shares at such times and in such manner and to such persons or
      class of persons as the directors may determine and as the Company Act,
      the Securities Act, and all other applicable laws permit.

2.3   When the Company is authorized to issue shares without par value, the
      directors are authorized to determine the price or consideration for
      which such shares shall be allotted or issued, and notwithstanding that
      the price or consideration for a share may be other than cash, the
      price or consideration for a share shall, at the time when the share is
      allotted, be expressed in terms of money and so recorded in the
      proceedings of the directors of the Company.

2.4   No share shall be issued until the Company has received the full
      consideration therefore in cash, property, or services, provided that:

      (a)   a document or book account evidencing indebtedness of the
            allottee does not constitute property;

      (b)   services shall be past services actually performed for the
            Company; and

      (c)   the value of property or services shall be the value the
            directors determine by resolution to be, in all the circumstances
            of the transaction, the fair market value.

2.5   Subject to the provisions and restrictions contained in the Company Act
      applicable to the shares without par value or otherwise, the Company
      may pay a commission or allow a discount in an amount not exceeding 25%
      of the amount of the subscription price to any person in consideration
      of his subscribing or agreeing to subscribe, or procuring or agreeing
      to procure subscriptions, whether absolutely or conditionally for
      shares. The Company may pay such brokerage as may be lawful.


                          PART 3 - SHARE CERTIFICATES

3.1   Every share certificate issued by the Company shall be in such form as
      the directors approve and shall comply with the requirements of the
      Company Act.

3.2   If any share certificate is worn out or defaced, then upon production
      of that certificate to the directors or the transfer agent of the
      Company, the directors or that transfer agent may declare the same to
      be cancelled and cause it to be so marked and may issue a new
      certificate in place of the certificate cancelled. If any share
      certificate is lost or destroyed, then, upon proof of the loss or
      destruction to the satisfaction of the directors, and upon giving such
      indemnity as the directors deem adequate, a new certificate shall be
      issued to the party entitled to it. In any such case where a new share
      certificate is issued, the fee prescribed in Part 18 of these Articles
      must be paid if requested.

3.3   A share certicate registered in the names of two or more persons shall
      be delivered to the person first named on the register.





                                    - 3 -


                     PART 4 - TRANSFER OF SHARES, GENERAL

4.1   Subject to the restrictions, if any, set forth in these Articles, any
      member may transfer his shares by instrument in writing executed by or
      on behalf of such member and delivered to the Company or its transfer
      agent. The instrument of transfer of any share of the Company shall be
      in the form, if any, on the back of the certificate of the share being
      transferred, or in any other form which the directors may approve. If
      the directors so require, each instrument of transfer shall be in
      respect of only one class of shares.

4.2   Every instrument of transfer shall be executed by the transferor and left
      at the registered office of the Company or at an authorized office of
      its transfer agent for registration, together with the certificate for
      the shares to be transferred and such other evidence, if any, as the
      directors or the transfer agent may require to prove the title of the
      transferor or his right to transfer the shares. All instruments of
      transfer which are registered shall be retained by the Company or its
      transfer agent, but any instrument of transfer where the transfer is
      not registered shall be returned to the person depositing the same,
      together with the share certificate which accompanied the same when
      tendered for registration. The transferor shall remain the holder of
      the share until the name of the transferee is entered on the register
      in respect of that share.

4.3   The signature of the registered owner of any shares, or of his duly
      authorized attorney, upon the form of transfer consitutes an authority
      to the Company to register the shares specified in the form of
      transfer in the name of the person named in that form as transferee or,
      if no person is so named, then in any name designated in writing by the
      person depositing the share certificate and the form of transfer with
      the Company or its agents. The Company or its transfer agent may
      require proof or guarantee of the signature of any transferor.

4.4   Neither the Company nor any director, officer or agent is bound to
      enquire into the title of the transferee of shares to be transferred,
      nor is any such person liable to the registered or any intermediate
      owner of the shares for registering the transfer.

4.5   The Company may keep its register of members either at its records
      office or at any office in the Province of British Columbia of a trust
      company registered under the Trust Company Act, and may keep, or cause
      to be kept within the Province by a trust company registered as
      aforesaid, one or more branch registers of members.

4.6   Whenever the Company is a reporting company, but not otherwise, it may
      cause one or more branch registers of members to be kept outside the
      Province of British Columbia.

                       PART 5 - TRANSMISSION OF SHARES

5.1   In the case of the death or bankruptcy of a member, his personal
      representative or trustee in bankruptcy shall be the only person
      recognized by the Company as having any title to or interest in the
      shares registered in the name of the deceased. Before recognizing any
      personal representative or trustee in bankruptcy the directors may
      require him to produce and deposit the documents required by the
      Company Act.




                                      - 4 -


      Notwithstanding anything otherwise provided in these Articles, if a
      person becomes entitled to a share as a result of an order of a Court
      of competent jurisdiction or pursuant to a statute, then, upon
      producing such evidence as the directors think sufficient that he is so
      entitled, such person may be registered as holder of the share.

                        PART 6 - BORROWING AND CAPITAL
                        ------------------------------

6.1   Subject to any restriction which may from time to time be included in
      the memorandum of the Company or these Articles or contained in the
      Company Act or the terms, rights or restrictions of any shares or
      securities of the Company outstanding, the directors may at their
      discretion authorize the Company to borrow any sum of money and may
      raise or secure the repayment of such sum in such manner and upon such
      terms and conditions, in all respects, as they think fit, and in
      particular, and without limiting the generality of the foregoing, by
      the issue of bonds or debentures, or any mortgage or charge, whether
      specific or floating, or by granting any other security on the
      undertaking, or the whole or any part of the property, of the Company,
      both present and future.

6.2   The directors may make any debentures, bonds or other debt obligations
      issued by the Company, by their terms assignable free from any equities
      between the Company and the person to whom they may be issued or any
      other person who lawfully acquires the same by assignment, purchase, or
      otherwise, howsoever.

6.3   The directors may authorize the issue of any debentures, bonds or other
      debt obligations of the Company at a discount, premium or otherwise,
      and with special or other rights or privileges as to redemption,
      surrender, entitlement to interest or share of income, allotment of, or
      conversion into, or exchange for shares, attendance at general meetings
      of the Company, and otherwise as the directors may determine at or
      before the time of issue, but no debenture shall be issued which the
      Company has not the power to reissue until the members by resolution
      determine such debenture shall be cancelled unless such debenture
      expressly provides by its terms that it shall not be reissued. The
      Company may cause one or more branch registers of its debenture holders
      to be kept.

6.4   The Company by ordinary resolution of the members and insofar as the
      Company Act shall permit, may alter its memorandum to increase its
      authorized capital by:

      (a)   creating shares with par value, or shares without par value, or
            both;

      (b)   increasing the number of shares with par value, or shares without
            par value, or both;

      (c)   increasing the par value of a class of shares with par value, if
            no shares of that class are issued; or

      (d)   creating shares of different classes with special rights or
            restrictions.

6.5   The Company may, by resolution of the directors and subject to the
      provisions of the Company Act and the specific provisions of any
      special rights or restrictions attached to any class or classes of its
      shares, purchase or otherwise acquire any of its shares





                                      - 5 -


      if, at the time of the proposed purchase or acquisition the Company is
      not insolvent or likely to be rendered insolvent by such purchase or
      acquisition and if, where a proposed purchase of shares is not to be
      made through a stock exchange, the Company shall make its offer to
      purchase pro rata to every member who holds shares of the class or kind
      to be purchased unless the Company is purchasing shares from a
      dissenting member pursuant to the Company Act.

6.6   The Company may, by resolution of the directors and subject to the
      provisions of the Company Act and the specific provisions of any
      special rights or restrictions attached to any class or classes of its
      shares by the Memorandum or these Articles, redeem any of its issued
      shares that have a right of redemption attached thereto provided that
      at the time of such redemption the Company is not insolvent or likely
      to be rendered insolvent by such redemption and where the Company
      proposes to redeem some, but not all, of its shares of a particular
      class or kind, the directors shall have absolute discretion to
      determine in such manner as they deem proper which shares shall be
      redeemed, and, without limiting the generality of the foregoing, may
      redeem shares which have been purchased by the Company in priority to
      shares which are held by members.


                             PART 7 - MEETINGS
                             -----------------

7.1   Meetings of the Company shall be held at such time and place, in
      accordance with the Company Act, as the directors appoint, and, unless
      otherwise specifically provided, the provisions of these Articles
      relating to meetings shall apply with necessary changes to a meeting of
      members holding a particular class of shares. Notwithstanding the
      foregoing, a meeting of members may only be held outside Canada if all
      members entitled to vote at that meeting so agree, and a shareholder
      who attends a meeting of members held outside Canada is deemed to have
      so agreed except when he attends the meeting for the express purpose of
      objecting to the transaction of any business on the grounds that the
      meeting is not lawfully held.

7.2   Every meeting, other than an annual general meeting or a class meeting,
      shall be called an extraordinary general meeting.

7.3   The directors may, whenever they think fit, convene an extraordinary
      general meeting.

7.4   Notice of a meeting shall specify the place, the day and the hour of
      meeting, and, in case of special business, the general nature of that
      business. Notice shall be given no less than 21 days or more than 50
      days before the meeting. The accidental omission to give notice of any
      meeting to, or the non-receipt of any notice by, any of the members
      entitled to receive notice, shall not invalidate any proceedings at
      that meeting.

7.5   If any special business includes presenting, considering, approving,
      ratifying or authorizing the execution of any document, then the
      portion of any notice relating to that document is sufficient if it
      states that a copy of the document or proposed document is or will be
      available for inspection by members at an office of the Company in the
      Province of British Columbia or at one or more designated places in





                                      - 6 -


      the Province during business hours on any specified or unspecified
      business day or days prior to the date of the meeting, and at the
      meeting.


                   PART 8 - PROCEEDINGS AT GENERAL MEETINGS
                   ----------------------------------------

8.1   The following business at a general meeting shall be deemed to be
      special business:

      (a)   All business at an extraordinary general meeting;

      (b)   All business that is transacted at an annual general meeting,
            with the exception of the consideration of the financial
            statements and the report of the directors and auditors, the
            election of directors, the appointment of the auditors and such
            other business as, under these Articles or in accordance with the
            Company Act, ought to be transacted at an annual general meeting
            or is business which is brought under consideration by the report
            of the directors issued with the notice convening the meeting;

      and no special business shall be conducted at any meeting unless notice
      of that business has been given to the members in accordance with these
      Articles or members holding at least 75% of the shares entitled to be
      voted at that meeting are present and consent to the conduct of such
      business.

8.2   No business, other than the election of a chairman and the adjournment
      or termination of the meeting, shall be conducted at any meeting at any
      time when a quorum is not present. A quorum shall be one person holding
      or representing by proxy not less than one-half of the outstanding
      shares of the Company which are entitled to be voted at the meeting,
      unless the Company has only one member, in which case the quorum shall
      be that member who may conduct the business of the Company by
      proceedings recorded in writing and signed by him. If at any time
      during a meeting there ceases to be a quorum present, any business then
      in progress shall be suspended until there is a quorum present or until
      the meeting is adjourned or terminated, as the case may be.

8.3   If within 30 minutes from the time appointed for a meeting a quorum is
      not present, the meeting, if convened upon the requisition of members,
      shall be terminated. In any other case, it shall stand adjourned to the
      same day in the next week, at the same time and place, and if, at the
      adjourned meeting, a quorum is not present within half an hour from the
      time appointed for the meeting, the member or members present shall be
      a quorum.

8.4   Subject to Article 8.5, the chairman of the board of directors, if
      there is one, failing whom the president of the Company, failing whom
      one of the directors present chosen by the directors from among their
      number, shall preside as chairman of every meeting.

8.5   If at any general meeting there is no chairman or president or director
      present within 15 minutes after the time appointed for holding the
      meeting, or if the chairman or president and all the directors present
      are unwilling to act as chairman, the members present shall choose
      someone of their number to be chairman.




                                    - 7 -

8.6  The chairman of a meeting may, with the consent of any meeting at which
     a quorum is present, and shall, if so directed by the meeting, adjourn
     the meeting from time to time and from place to place, but no business
     shall be transacted at any adjourned meeting other than the business
     left unfinished at the meeting from which the adjournment took place.
     When a meeting is adjourned for 30 days or more, notice of the adjourned
     meeting shall be given as in the case of the original meeting. Except as
     aforesaid, it is not necessary to give any notice of an adjournment or
     of the business to be transacted at an adjourned meeting.

8.7  No resolution proposed at a meeting need be seconded, and the chairman
     of any meeting is entitled to move or propose a resolution.

8.8  In case of an equality of votes the chairman shall not, either on a show
     of hands or on a poll, have a casting or second vote in addition to the
     vote or votes to which he may be entitled as a member, which vote or
     votes he is entitled to cast without vacating the chair.

8.9  In the case of any dispute as to the admission or rejection of a proxy
     or a vote, the chairman shall determine the same and his determination,
     made in good faith, is final and conclusive.

8.10 A member entitled to more than one vote need not, if he votes, use all
     his votes or cast all the votes he uses in the same way.

8.11 Subject to these Articles, if a poll is duly demanded it shall be taken
     in such manner as the chairman directs within seven days of the demand
     for the same. The result of the poll shall be deemed to be the
     resolution of the meeting at which the poll is demanded. A demand for a
     poll may be withdrawn at any time before it has been taken.

8.12 A poll demanded on a question of adjournment shall be taken at the
     meeting without adjournment.

8.13 The demand for a poll shall not, unless the chairman so rules, prevent
     the continuance of a meeting for the transaction of any business other
     than the question on which a poll has been demanded or questions which
     depend or bear upon that question.

8.14 Subject always to any contrary or specific provision of the Company Act,
     a resolution that has been submitted to all of the members who would
     have been entitled to vote thereon in person or by proxy at a meeting
     and that has been consented to in writing by such members holding not
     less than 75% of the shares of the Company shall be deemed to be an
     ordinary resolution passed at a meeting.

8.15 Subject always to any contrary or specific provision of the Company Act,
     a resolution consented to in writing by every member of the Company who
     would have been entitled to vote thereon in person or by proxy at a
     meeting shall be deemed to be a special resolution passed at a meeting.

8.16 Subject always to the provisions of the Company Act, whenever the
     Company is not a reporting company, where all the members entitled to
     attend and vote at the annual general meeting of the Company consent in
     writing to all the business




                                  - 8 -


     required to be transacted at the meeting, it is not necessary for the
     Company to hold that annual general meeting.


                           PART 9 - VOTES OF MEMBERS
                           -------------------------

9.1  Subject to any rights or restrictions for the time being attached to any
     class or classes of shares, on a show of hands every member present in
     person or by proxy has one vote, and on a poll every such member present
     in person or by proxy has one vote for each share he holds on the record
     date except that no member which is a corporation which is a subsidiary
     of the Company shall be entitled to vote its shares of the Company, and
     the Company itself shall not vote in respect of any share of the Company
     that it has redeemed purchased, or otherwise acquired.

9.2  Any person who is not registered as a member but who is entitled to vote
     at any meeting in respect of a share, may vote the share in the same
     manner as if he were a member, but, unless the directors have previously
     admitted his right to vote at that meeting in respect of the share, if
     so required by any director he shall satisfy the directors of his right
     to vote the share before the time for holding the meeting, or adjourned
     meeting, as the case may be, at which he proposes to vote.

9.3  Where there are joint members registered in respect of any share, any
     one of the joint members may vote at any meeting, either personally or
     by proxy, in respect of the share as if he were solely entitled to it.
     If more than one of the joint members is present at any meeting,
     personally or by proxy, the joint member present whose name stands first
     on the register in respect of the share shall alone be entitled to vote
     in respect of that share. Several executors or administrators of a
     deceased member in whose sole name any share stands shall, for the
     purposes of this Article, be deemed joint members.

9.4  Subject to the provisions of the Company Act, a corporation which is a
     member and is not a subsidiary of the Company may vote by up to two duly
     authorized representatives, who are entitled to speak and vote, either
     in person or by proxy, and in all other respects exercise the rights of
     a member and those representatives shall be reckoned as a member for all
     purposes in connection with any meeting of the Company.

9.5  A member for whom a committee has been duly appointed may vote, whether
     on a show of hands or on a poll, by his committee and that committee may
     appoint a proxyholder.

9.6  Unless the directors otherwise determine, the instrument appointing a
     proxyholder and the power of attorney or other authority, if any, under
     which it is signed, or a notarially certified copy thereof, shall be
     deposited at a place specified for that purpose in the notice convening
     the meeting, not less than 48 hours before the time for holding the
     meeting at which the proxyholder proposes to vote, or, if no such place
     is specified, then it shall be deposited with the chairman of the
     meeting prior to the commencement of the meeting.

9.7  A vote given in accordance with the terms of an instrument of proxy is
     valid notwithstanding the previous death or incapability of the member,
     or revocation of





                                       - 9 -


     the proxy, or of the authority under which the proxy was executed, or
     the transfer of the share in respect of which the proxy is given, if,
     but only if, no prior notice in writing of the death, incapability,
     revocation or transfer has been received at the registered office of the
     Company or by the chairmen of the meeting or adjourned meeting before
     the vote is given.

9.8  An instrument appointing a proxyholder, whether for a specified meeting
     or otherwise, shall be, subject to the requirements of the Company Act,
     in the form approved by the directors.

9.9  A proxy or an instrument appointing a duly authorized representative of
     a corporation shall be in writing, under the hand of the appointor or of
     his attorney duly authorized in writing, or, if such appointor is a
     corporation, either under its seal or under the hand of an officer or
     attorney duly authorized.

9.10 Any person may act as a proxyholder whether or not he is entitled on his
     own behalf to be present and to vote at the meeting at which he acts as
     proxyholder.

9.11 The directors may, by resolution, fix in advance a date and time as the
     record for the determination of the members entitled to receive notice
     of a meeting of the members, but such record date shall not precede by
     more than 50 days or by less than 21 days the date on which the meeting
     is to be held. If the directors fail to fix in advance a date and time
     as the record date in respect of all or any of the matters described
     above for any meeting of the members of the Company, the following
     provisions shall apply, as the case may be:

     (a)  the record date for the determination of the members entitled to
          receive notice of a meeting of members shall be at the close of
          business on the day immediately preceding the day on which notice
          is given or sent;

     (b)  the record date for the determine of the members entitled to
          receive the financial statements of the Company shall be the close
          of business on the day on which the directors pass the resolution
          relating thereto.


                              PART 10 - DIRECTORS
                              -------------------

10.1 The directors named in the Instrument of Continuation at the coming into
     force of these Articles, shall be the directors of the Company unless
     and until such person:

     (a)  dies;

     (b)  resigns in writing;

     (c)  is no longer qualified in accordance with these Articles or the
          Company Act; or

     (d)  is removed from office by ordinary resolution of the members.

10.2 The management of the business of the Company shall be vested in the
     directors and the directors may exercise all such powers and do all such
     acts and things as the Company may exercise and do which are not by
     these Articles or by the Company Act or otherwise lawfully directed or
     required to be exercised or done by




                                      - 10 -

     the Company in general meeting, but subject, nevertheless, to the
     provisions of all laws affecting the Company and of these Articles and
     to any rules, not being inconsistent with these Articles which are made
     from time to time by the Company in general meeting, provided that no
     rule made by the Company in general meeting shall invalidate any prior
     act of the directors that would have been valid if that rule had not
     been made.

10.3 The number of directors shall be at least one as long as the Company is
     not a reporting company, and shall be at least three whenever the Company
     is a reporting company, and no more than 25. Subject to the foregoing,
     the number of directors may be determined from time to time by
     resolution of the members, and provided that the number of directors
     holding office shall not fall below the minimum numbers above mentioned,
     the number of directors shall be automatically reduced upon the death,
     resignation, removal or disqualification of any director and
     automatically increased upon the appointment of any additional director
     or directors in accordance with these Articles.

10.4 A director is not required to hold a share of the Company as
     qualification to be a director, but in order to be qualified he must not
     be:

     (a)  under the age of 18 years; or,

     (b)  found to be incapable of managing his own affairs by reason of
          mental infirmity; or,

     (c)  a corporation; or,

     (d)  an undischarged bankrupt; or,

     (e)  unless the Supreme Court of British Columbia orders otherwise,
          convicted within or without the Province of British Columbia of an
          offence

          (i)   in connection with the promotion, formation, or management of
                a corporation; or,

          (ii)  involving fraud,

          unless five years have elapsed since the expiration of the period
          fixed for suspension of the passing of sentence without sentencing,
          or since a fine was imposed, or the term of imprisonment and
          probation imposed, if any, was concluded, whichever is the latest,
          but the disability imposed by this clause ceases upon a pardon being
          granted under the Criminal Records Act (Canada);

     and every director must not be subject to any other disqualifications as
     to office according to the Company Act, provided always that no person
     who is not ordinarily resident in Canada shall be appointed a director
     of the Company if, upon his appointment, the majority of the directors
     of the Company would not be persons ordinarily resident in Canada.

10.5 In the event of the death, resignation, removal or disqualification of a
     director and his consequent vacating of office in accordance with these
     Articles or the Company Act




                                      - 11 -



      in circumstances in which the majority of the directors of the Company
      would thereafter not be persons ordinarily resident in Canada, then the
      last appointed director who is not ordinarily resident in Canada shall,
      ipso facto, be disqualified from office and be no longer a director of
      the Company. In the event there are on the happening of such an event
      two or more persons who are not ordinarily resident in Canada who were
      last appointed and appointed at the same time, then the Secretary shall
      determine by lot which of the two or more so last appointed shall have
      ceased to hold office by reason of this paragraph. Subject to the
      foregoing, if a casual vacancy should occur in the board, the remaining
      directors if constituting a quorum may appoint a qualified person to
      fill the vacancy for the remainder of the term. Where a vacancy or
      vacancies exist on the board, the remaining directors may exercise all
      of the powers of the board so long as a quorum remains in office.

10.6  If the Company removes any director by ordinary resolution, it may by
      ordinary resolution, appoint another person in his stead.

10.7  Any person not being a member of the Company who becomes a director
      shall be deemed to have agreed to be bound by the provisions of the
      Articles to the same extent as if he were a member of the Company.

10.8  Subject to the provisions of any ordinary resolution, the remuneration
      of the directors as such may from time to time be determined by the
      directors themselves, and such remuneration may be in addition to any
      salary or other remuneration paid to any officer or employee of the
      Company as such, who is also a director. The directors shall be repaid
      such reasonable expenses as they may incur in and about the business of
      the Company, and if any director shall perform any professional or other
      services for the Company that are outside the ordinary duties of a
      director, or shall otherwise be specifically occupied in or about the
      Company's business, he may be paid a special remuneration to be fixed by
      the directors in addition to any other remuneration that he may be
      entitled to receive and the same shall be charged as part of the
      ordinary working expenses. Unless otherwise determined by ordinary
      resolution, the directors on behalf of the Company may pay a gratuity or
      pension or allowance on retirement to any person who has held any office
      of employment with the Company or to his spouse or dependants and may
      make contributions under any plan or to any fund and pay premiums for
      the purchase or provision of any such gratuity, benefit, pension or
      allowance.

10.9  The directors may from time to time and at any time by power of attorney
      appoint any company, firm or person or body of persons to be the
      attorney or attorneys of the Company for such purposes and with such
      powers, authorities and discretion, not exceeding those vested in or
      exercisable by the directors under these Articles, and for such period,
      and subject to such conditions, as they may think fit.

10.10 A director who is in any way directly or indirectly interested in a
      proposed contract or transaction with the Company shall disclose the
      nature and extent of his interest at a meeting of the directors in
      accordance with the provisions of the Company Act. A director shall not
      vote in respect of any contract or transaction with the Company in which
      he is interested, and if he shall do so his vote shall not be counted,
      but he may be counted in the quorum present at the meeting at which such
      vote is taken.






                                   - 12 -

10.11 A director may hold any office or place of profit under the Company
      other than auditor, for such period, and on such terms as to
      remuneration or otherwise, as the directors may determine. Subject to
      compliance with the Company Act, no director shall be disqualified by
      his office from contracting with the Company either with regard to his
      tenure of any office or place of profit or as vendor, purchaser or
      otherwise.

10.12 Any director may act by himself or his firm in any professional
      capacity for the Company except as auditor, and he or his firm shall be
      entitled to remuneration for professional services as if he were not a
      director.

10.13 At each annual general meeting of the Company all the directors shall
      retire from office, but are eligible for re-election and the members
      shall by ordinary resolution elect a board of directors consisting of
      the number of directors so retiring or determined by resolution or
      recommendation of the directors. If in any calendar year the Company
      does not hold an annual general meeting the directors then in office
      shall be deemed to have been elected as directors on the last day on
      which the meeting should have been held pursuant to the Company Act,
      and the directors so elected may hold office until other directors are
      appointed or elected or until the day on which the next annual general
      meeting is held.


                         PART 11 - INDEMNIFICATION
                         -------------------------

11.1  The Company shall indemnify any director, officer, employee or agent of
      the Company who was or is a party or is threatened to be made a party
      to any threatened, pending or completed action or proceeding and
      whether civil, criminal or administrative, by reason of the fact that
      he is or was a director, officer, employee, or agent of the Company or
      any act or thing occurring at a time when he is or was serving at the
      request of the Company as a director, officer, employee or agent of
      another corporation, partnership, joint venture, trust or other
      enterprise, against all costs, charges and expenses, including legal
      fees and any amount paid to settle the action or proceeding or satisfy
      a judgment, if he acted honestly and in good faith with a view to the
      best interests of the corporation or other legal entity or enterprise
      as aforesaid of which he is or was a director, officer, employee or
      agent, as the case may be, and exercised the care, diligence and skill
      of a reasonably prudent person, and with respect to any criminal or
      administrative action or proceeding, he had reasonable ground for
      believing that his conduct was lawful; provided that no indemnification
      of a director or former director of the Company, or director or former
      director of a corporation in which the Company is or was a shareholder,
      shall be made except to the extent approved by the Court pursuant to
      the Company Act or any other statute. The determination of any action,
      suit or proceeding by judgment, order, settlement, conviction or
      otherwise shall not, of itself, create a presumption that the person
      did not act honestly and in good faith and in the best interests of the
      Company and did not exercise the care, diligence and skill of a
      reasonably prudent person and, with respect to any criminal action or
      proceeding, did not have reasonable grounds to believe that his conduct
      was lawful.

11.2  The Company shall indemnify any person in respect of any loss, damage,
      costs or expenses whatsoever incurred by him while acting as an
      officer, employee or agent





                                   - 13 -


      for the Company unless such loss, damage, costs or expenses shall arise
      out of failure to comply with instructions, wilful act or default or
      fraud by such person, in any of which events the Company shall only
      indemnify such person if the directors, in their absolute discretion,
      so decide or the Company by ordinary resolution shall so direct.

11.3  The indemnification provided by this Article shall not be deemed
      exclusive of any other rights to which those seeking indemnification
      may be entitled under any other Article, or any valid and lawful
      agreement, vote of members or disinterested directors or otherwise,
      both as to action in his official capacity and as to action in another
      capacity while holding such office, and shall continue as to a person
      who has ceased to be a director, officer, employee or agent and shall
      entire to the benefit of the heirs, executors and administrators of
      such person. The indemnification provided by this Article shall not be
      exclusive of any powers, rights, agreements or undertakings which may
      be legally permissible or authorized by or under any applicable law.
      Notwithstanding any other provisions set forth in this Article, the
      indemnification authorized by this Article shall be applicable only to
      the extent that any such indemnification shall not duplicate indemnity
      or reimbursement which that person has received or shall receive
      otherwise than under this Part.

11.4  The directors are authorized from time to time to cause the Company to
      give indemnities to any director, officer, employee, agent or other
      person who has undertaken or is about to undertake any liability on
      behalf of the Company or any corporation controlled by it.

11.5  Subject to the Company Act, no director or officer or employee for the
      time being of the Company shall be liable for the acts, receipts,
      neglects or defaults of any other director or officer or employee, or
      for joining in any receipt or act for conformity, or for any loss,
      damage or expense happening to the Company through the insufficiency or
      deficiency of title to any property acquired by order of the Board for
      the Company, or for the insufficiency or deficiency of any security in
      or upon which any of the moneys of or belonging to the Company shall be
      invested or for any loss or damages arising from the bankruptcy,
      insolvency, or tortious act of any person, firm or corporation with
      whom or which any moneys, securities or effects shall be lodged or
      deposited or for any loss occasioned by any error of judgment or
      oversight on his part or for any other loss, damage or misfortune
      whatever which may happen in the execution of the duties of his
      respective office or trust or in relation thereto unless the same shall
      happen by or through his own wilful act or default, negligence, breach
      of trust or breach of duty.

11.6  Directors may rely upon the accuracy of any statement of fact
      represented by an officer of the Company to be correct or upon
      statements in a written report of the auditor of the Company and shall
      not be responsible or held liable for any loss or damage resulting from
      the paying of any dividends or otherwise acting in good faith upon any
      such statement.

11.7  The directors may cause the Company to purchase and maintain insurance
      for the benefit of any person who is or was a director, officer,
      employee or agent of the Company or is or was serving at the request of
      the Company as a director, officer, employee or agent of another
      corporation, partnership, joint venture, trust or other





                                   - 14 -


      enterprise against any liability incurred by him as a director,
      officer, employee or agent.


                      PART 12 - PROCEEDINGS OF DIRECTORS.
                      -----------------------------------


12.1  Notice of the time and place of a directors meeting shall be given to
      each director no less than two days (exclusive of the day on which the
      notice is given) before the date of the meeting. For the first meeting
      of directors held immediately after election at a meeting of members,
      no notice of such meeting need be given, provided a quorum of directors
      is present. Notice for the time and place of special meetings of
      directors shall be delivered or faxed to each director not less than
      four hours before that special meeting.

12.2  The directors, when there is more than one, may meet together at such
      places as they think fit for the dispatch of business, and may adjourn
      and otherwise regulate their meetings and proceedings as they see fit.

12.3  The quorum shall be a majority of the directors then in office, and when
      an even number of directors are holding office, shall be one more than
      half of their number.

12.4  Unless and until the directors shall elect one of their number to be
      chairman of the board of directors, the president of the Company shall
      be chairman of all meetings of the directors; but if at any meeting a
      chairman elected by the directors or the president is not present
      within 30 minutes after the time appointed for holding the meeting, the
      directors present may choose someone of their number to be chairman at
      that meeting.

12.5  Any director may waive notice of any meeting of directors. Accidental
      omission to give notice of a meeting of directors to, or non-receipt of
      notice by, any director, shall not invalidate the proceedings of any
      meeting of the directors.

12.6  Except as provided in the Company Act, the Directors may participate in
      a meeting of the Directors by means of telephone or other
      communications facilities that permit all Directors participating in
      the meeting to communicate with each other. A meeting so held in
      accordance with this Article shall be deemed to be an actual meeting of
      the board and any resolution passed at such meeting shall be as valid
      and effectual as if it had been passed at a meeting where the Directors
      are physically present. A Director participating in a meeting in
      accordance with this Article shall be deemed to be present at the
      meeting and to have so agreed and shall be counted in the quorum
      therefore and be entitled to participate in and vote thereat.

12.7  The directors, or any committee of directors, may take any action
      required or permitted to be taken by them and may exercise all or any
      of the authorities, powers and discretion for the time being vested in
      or exercisable by them by resolution either passed at the meeting at
      which a quorum is present or authorized by resolution consented to in
      writing signed by all the directors in accordance with the Company Act.

12.8  The directors may delegate any, but not all, of their powers to
      committees consisting of such director or directors as they think fit.
      A majority of the members of any such





                                   - 15 -


      committee must be resident Canadians. Any committee so formed in the
      exercise of the powers so delegated shall conform to any rules that may
      from time to time be imposed on it by the directors, and shall report
      every act or thing done in exercise of those powers to the first
      meeting of the directors held after it has been done.

12.9  A committee of more than one director may elect a chairman of its
      meetings and if no chairman is elected, or if at any meeting the
      chairman is not present within 30 minutes after the time appointed for
      holding the meeting, the directors present who are members of the
      committee may choose one of their number to be chairman of the meeting.

12.10 The member or members of a committee may govern their procedure as they
      think proper, subject to any rules imposed by the directors. Questions
      arising shall be determined by the member, if there be only one, or by
      a majority of votes of the members present, but in case of an equality
      of votes the chairman of a committee shall not have a second or casting
      vote.

12.11 Any director of the Company who may be absent from the Province of
      British Columbia may file at the registered office of the Company by
      letter or facsimile a waiver of notice of any meeting of the directors
      and may, at any time and by one of the means mentioned aforesaid,
      withdraw the waiver, but until the waiver is withdrawn, no notice of
      meetings of directors need be sent to that director, and any and all
      meetings of the directors of the Company held after receipt of such
      waiver and held prior to its withdrawal shall, provided a quorum of the
      directors is present, be valid and effective without notice of such
      meeting given to that director.

12.12 Questions arising at any meeting of the directors shall be decided by a
      majority of votes. In case of an equality of votes, the chairman shall
      not have a second or casting vote.

12.13 No resolution proposed at a meeting of directors need be seconded, and
      the chairman of any meeting is entitled to move or propose and vote
      upon a resolution of the directors.

12.14 All acts done by any meeting of the directors or by a committee of
      directors or by any person acting as a director shall, notwithstanding
      that it shall be afterwards discovered that there was some defect in
      the appointment of any such director or person acting as aforesaid, or
      that they or any of them were disqualified be as valid as if every such
      person had been duly appointed and was qualified to be a director.


                                PART 13 - OFFICERS
                                ------------------

13.1  The Company shall have a president and a secretary whom the directors
      shall appoint. The President must be a director of the Company. Except
      when the Company has only one member, the President and Secretary
      shall be different persons. Subject to the foregoing, the board may
      from time to time appoint such other officers as the board may
      determine.

13.2  All appointments of officers shall be made at such remuneration,
      whether by way of salary, fee, commission, participation in profits, or
      otherwise, as the directors think





                                   - 16 -


      fit, and every appointment of an officer by the directors shall be in
      force until revoked by the directors or until the death or resignation
      in writing of the officer unless otherwise provided in the resolution of
      appointment.

13.3  Every officer of the Company who holds any office or possesses any
      property whereby, whether directly or indirectly, duties or interests
      might be created in conflict with his duties or interests as an officer
      of the Company shall, in writing, disclose to the President the fact
      and the nature, character and extent of the conflict.

13.4  The chairman of the board of directors, if any, shall, if present,
      preside at all meetings of the board of directors and of members. He
      shall sign such contracts, documents or instruments in writing as
      require his signature and shall have such other powers and duties as
      may from time to time be assigned to him by resolution of the directors.

13.5  The president, who may also be the chief executive officer of the
      Company, shall exercise general supervision over the business and
      affairs of the Company. In the absence or inability of the chairman of
      the board of directors, the president shall, when present, preside at
      all meetings of the board of directors and members; he shall sign such
      contracts, documents or instruments in writing as require his signature
      and shall have such other powers and shall perform such other duties as
      may from time to time be assigned to him by resolution of the board of
      directors or as are incident to his office.

13.6  The vice president, or, if more than one, the vice presidents, in order
      of seniority, shall be vested with all the powers and shall perform all
      the duties of the president in the absence or inability or refusal to
      act of the president, provided, however, that a vice president, who is
      not a director, shall not preside as chairman at any meeting of
      members. The vice president or, if more than one, the vice presidents,
      in order of seniority, shall sign such contracts, documents or
      instruments in writing as require his or their signatures and shall
      also have such other powers and duties as may from time to time be
      assigned to him or them by resolution of the board of directors.

13.7  The secretary, if any, shall give or cause to be given notices for all
      meetings of the board of directors, or committees thereof, if any, and
      of members when directed to do so and shall have charge, subject to the
      Articles, of the corporate records and of the corporate seal or seals,
      if any. He shall sign such contracts, documents or instruments in
      writing as require his signature and shall have such other powers and
      duties as may from time to time be assigned to him by resolution of the
      board of directors or as are incident to his office.

13.8  Subject to the provisions of any resolution of the board of directors,
      the treasurer, if any, shall have the care and custody of all the funds
      and securities of the Company and shall deposit the same in the name of
      the Company in such bank or banks or with such other depositary or
      depositaries as the board of directors may, by resolution, direct. He
      shall prepare, maintain and keep or cause to be kept adequate books of
      accounts and accounting records. He shall sign such contracts,
      documents or instruments in writing as require his signature and shall
      have such other powers and duties as may from time to time be assigned
      to him by resolution of the board of directors or as are incident to
      his office. He may be required to give such bond for





                                   - 17 -


      the faithful performance of his duties as the board of directors, in
      their absolute discretion, may require, and no director shall be liable
      for failure to require any such bond or for the insufficiency of any
      such bond or for any loss by reason of the failure of the Company to
      receive any indemnity thereby provided.

13.9  The assistant secretary or, if more than one, the assistant
      secretaries, in order of seniority, and the assistant treasurer or, if
      more than one, the assistant treasurers, in order of seniority, shall
      respectivey perform all the duties of the secretary and treasurer,
      respectively, when required to do so. The assistant secretary or
      assistant secretaries, if more than one, and the assistant treasurer or
      assistant treasurers, if more than one, shall sign such contracts,
      documents or instruments in writing as require his or their signatures
      respectively and shall have such other powers and duties as may from
      time to time be assigned to them by resolution of the board of
      directors.

13.10 The board of directors may from time to time appoint from their number
      a managing director, who is a resident Canadian, and may, subject to
      the Company Act, delegate to him any of the powers of the board of
      directors. The managing director shall conform to all lawful orders
      given to him by the board of directors of the Company and shall, at all
      reasonable times, give to the directors, or any of them, all
      information they may require regarding the affairs of the Company. Any
      agent of employee appointed by the managing director shall be subject
      to discharge by the board of directors.


                       PART 14 - EXECUTION OF INSTRUMENTS
                       ----------------------------------

14.1  Contracts, documents or instruments in writing requiring the signature
      of the Company may be signed any director or any officer of the
      Company, or by any person authorized by resolution of the board of
      directors. All contracts, documents or instruments in writing so signed
      shall be binding upon the Company without any further authorization or
      formality. The board of directors is authorized from time to time, by
      resolution, to appoint any officer or officers or any other person or
      persons on behalf of the Company, either to sign contracts, documents
      or instruments in writing generally or to sign specific contracts,
      documents or instruments in writing. Where the Company has only one
      director and officer being the same person, that person may sign all
      such contracts, documents or other written instruments.

14.2  The directors may, but shall not be required to, provide a common seal
      for the Company. They shall have power from time to time to destroy the
      same or substitute a new seal in place of the seal destroyed or to
      cause the affairs of the Company to be conducted without a common seal.
      In the event a seal is provided, then unless otherwise provided by the
      directors, the same may be affixed to any document by the signing
      officers designated in Article 14.1.

14.3  Subject to the provisions of the Company Act, the directors may provide
      for use in any other province, state, territory or country an official
      seal, which shall be a facsimile of the common seal of the Company,
      with the addition on its face of the name of the province, state,
      territory or country where it is to be used.




                                     - 18 -


14.4  The signature of any officer of the Company may be printed,
      lithographed, engraved or otherwise mechanically reproduced upon all
      instruments executed or issued by the Company or any officer thereof;
      and, subject to the Company Act, any instrument on which the signature
      of any such person is so reproduced, shall be deemed to have been
      manually signed by such person whose signature is so reproduced and
      shall be as valid to all intents and purposes as if such instrument had
      been signed manually, and notwithstanding that the person whose
      signature is so reproduced may have ceased to hold office at the date of
      the delivery or issue of such instrument. The term "instrument" as used
      in this Article shall include all paper and electronic writings.


                             PART 15 - DIVIDENDS
                             -------------------

15.1  The directors may declare dividends and fix the date of record
      therefore and the date for payment thereof.

15.2  Subject to the terms of shares with special rights or restrictions, all
      dividends shall be declared according to the number of shares held.

15.3  Dividends may only be payable out of the profits of the Company. No
      dividend shall bear interest against the Company. A transfer of a share
      shall not pass the right to any dividend thereon before the
      registration of the transfer in the register.

15.4  A resolution declaring a dividend may direct payment of the dividend
      wholly or partly by the distribution of specific assets or of paid-up
      shares, bonds, debentures or other debt obligations of the Company, or
      in any one or more of those ways, and, where any difficulty arises in
      regard to the distribution, the directors may settle the same as they
      think expedient, and in particular may fix the value for distribution
      of specific assets, and may determine that cash payments shall be made
      to a member upon the basis of the value so fixed in place of fractional
      shares, bonds, debentures or other debt obligations in order to adjust
      the rights of all parties, and may vest any of those specific assets in
      trustees upon such trusts for the persons entitled as may seem
      expedient to the directors.

15.5  Any dividend or other moneys payable in cash in respect of a share may
      be paid by cheque sent through the post to the member in a prepaid
      letter, envelope or wrapper addressed to the member at his registered
      address, or in the case of joint members, to the registered address of
      the joint member who is the first named on the register, or to such
      person and to such address as the member or joint members, as the case
      may be, in writing direct. Any one of two or more joint members may
      give effectual receipts for any dividend or other moneys payable or
      assets distributable in respect of a share held by them.

15.6  No notice of the declaration of a dividend need by given to any member.

15.7  The directors may, before declaring any dividend, set aside out of the
      profits of the Company such sums as they think proper as a reserve or
      reserves which shall, at the discretion of the directors, be applicable
      for meeting contingencies, or for equalizing dividends, or for any
      other purpose to which the profits of the Company may be properly
      applied, and pending that application may, at the like discretion,





                                     - 19 -


      either be employed in the business of the Company or be invested in
      such investments, as the directors may from time to time think fit,
      including shares of the Company purchased or acquired in accordance
      with these Articles.

15.8  The directors may capitalize any undistributed surplus on hand of the
      Company and may from time to time issue as fully paid and
      non-assessable any unissued shares or any bonds, debentures or other
      debt obligations of the Company as a dividend representing such
      undistributed surplus on hand or any part thereof.

15.9  Should any dividend result in any shareholder being entitled to a
      fractional share, the directors shall have the right to pay such
      shareholders the cash equivalent of such fractional part, and shall
      have the further right to carry out such distribution and to adjust the
      rights of the shareholders with respect thereto on as practical and
      equitable a basis as possible.


                             PART 16 - ACCOUNTS
                             ------------------


16.1  The directors shall cause records and books of accounts to be kept as
      necessary to record properly the financial affairs and conditions of
      the Company and to comply with the provisions of the Company Act and
      all statutes applicable to the Company.

16.2  The fiscal period of the Company shall terminate on such day in each
      year as the board of directors may from time to time, by resolution,
      determine.


                             PART 17 - NOTICES
                             -----------------

17.1  A notice may be given to any member or director, either by personal
      service or by sending it by post to him in a letter, envelope or
      wrapper, or by facsimile addressed to the member or director at his
      registered address or in any manner approved by the directors and not
      prohibited under the Company Act.

17.2  A notice may be given by the Company to joint members in respect of a
      share registered in their names by giving the notice to the joint
      member first named in the register of members in respect of that share.

17.3  A notice may be given by the Company to the persons entitled to a share
      in consequence of the death or bankruptcy of a member by sending it
      through the post in a prepaid letter, envelope or wrapper addressed to
      them by name, or by the title of representatives of the deceased or
      trustee of the bankrupt, or by any like description, at the address, if
      any, supplied for the purpose by the persons claiming to be so
      entitled, or, until that address has been so supplied, by giving the
      notice in any manner in which the same might have been given if the
      death or bankruptcy had not occurred.

17.4  Any notice or document sent by post to, or left at, the registered
      address of any member, shall, notwithstanding that member is then
      deceased, and whether or not the Company has notice of his death, be
      deemed to have been duly served in respect of any registered shares,
      whether held solely or jointly with other persons by that deceased
      member, until some other person is registered in his stead as the





                                     - 20 -


      member or joint member in respect of those shares, and that service
      shall for all purposes of these Articles be deemed a sufficient service
      of such notice or document on his personal representatives and all
      persons, if any, jointly interested with him in those shares.

17.5  Any notice sent by post shall be deemed to have been served on the
      second day following that on which the letter, envelope or wrapper
      containing the same is posted exclusive of any day upon which the mail
      is not regularly delivered or handled in either the place of posting or
      the place of delivery, and in proving service it is sufficient to prove
      that the letter, envelope or wrapper containing the notice was properly
      addressed and put in a Canadian government post office, postage
      prepaid, subject always to it being proved by the person to whom the
      notice was addressed that the mail was not regularly delivered or
      handled as aforesaid on or between the day of posting and the day of
      delivery.

17.6  Notice of every general meeting shall be given in the manner
      hereinbefore authorized to:

      (a)   every member holding a share or shares carrying the right to vote
            at such meetings on the record date or, if no record date was
            established by the directors, on the date of personal service or
            mailing;

      (b)   every person upon whom the ownership of a share has devolved by
            reason of his being a legal personal representative or a trustee
            in bankruptcy of a member where the member, but for his death or
            bankruptcy, would be entitled to receive notice of the meeting;
            and

      (c)   the auditor of the Company.

      Subject to any provisions in any instrument of the Company or in the
      special rights or restrictions attached to any shares, no other person
      is entitled to receive notice of general meetings.


                                PART 18 - FEES
                                --------------

18.1  The Company may charge the following fee to issue a new certificate in
      exchange for an existing certificate or a defaced or worn out
      certificate or to replace a lost or destroyed certificate:

      Per new certificate: $1.00


                  PART 19 - TRANSFER OF SHARES. RESTRICTIONS
                  ------------------------------------------

19.1  A share or shares in the Company may be transferred by an instrument of
      transfer and in accordance with these Articles by any member, or the
      personal representative of any deceased member or the trustee in
      bankruptcy of any bankrupt member or by the liquidator of any member
      which is a corporation, only with the approval of a resolution of the
      directors.





                                     - 21 -


19.2  Notwithstanding anything otherwise provided in these Articles, the
      directors may, in their absolute discretion, refuse to allow and
      decline to register any transfer of shares to any person, even if the
      foregoing conditions and other provisions of these Articles are
      complied with, and the directors shall not be bound or required to
      disclose their reasons for any such refusal to anyone.

19.3  The number of shareholders of the Company is limited to 50, excluding
      persons who are currently or were formerly employees of the Company.
      Where two or more persons jointly hold one (1) or more shares, such
      persons shall be considered as one and the same shareholder.

19.4  All public offerings or public invitations to subscribe for or purchase
      securities is prohibited.


                   PART 20 - SPECIAL RIGHTS AND RESTRICTIONS
                   -----------------------------------------


CLASS A COMMON SHARES
- ---------------------

20.1  The holders of the Class A Common Shares shall be entitled to one vote
      for each such share so held at all meetings of members.

20.2  Subject the rights of the holders of the Class B Preferred Shares and
      any Class C Preferred Shares established by series, the directors shall
      be at liberty in their absolute discretion to declare dividends on any
      one or more class or classes of the Class A Common Shares, the Class B
      Preferred Shares or the Class C Preferred Shares to the exclusion of the
      others.

20.3  Subject to the rights of holders of the Class B Preferred Shares and
      any Class C Preferred Shares established by series, in the event of the
      liquidation, dissolution or wind-up of the Company, whether voluntary
      or involuntary, the holders of the Class A Common Shares shall be
      entitled to participate on a pro rata basis in the distribution of the
      remaining assets of the Company.

CLASS B PREFERRED SHARES
- ------------------------

20.4  Subject to the rights of the Class C Preferred Shares, the holders of
      Class B Preferred Shares shall be entitled to receive a preferred
      non-cumulative dividend the rate of which shall be determined from time
      to time by the board of directors of the Company, such dividend to be
      payable at such time and in such manner as shall be determined by the
      board.

20.5  Subject to the rights of the Class C Preferred Shares, in the event of
      winding-up or liquidation or any other distribution of the assets of
      the Company, the Class B Preferred Shares shall rank prior to all other
      shares of the Company as to the payment of the paid-up share capital
      and any dividends attributable thereto. The Class B Preferred Shares
      shall not otherwise share in the profits and surplus assets of the
      Company.

20.6  Subject to the terms of the Company Act, the holders of Class B
      Preferred Shares shall not, as such, be entitled to receive notice of,
      or attend or vote at, any meeting of members of the Company.





                                     - 22 -


20.7  Subject to the Company Act, the Class B Preferred Shares shall be
      redeemable at the option of the Company, upon a 30-day notice in
      writing, at a price that shall include the amount paid plus any
      declared and unpaid dividends. Where only part of the shares are
      redeemed, such redemption shall be made on a pro rata basis of the
      shares held by all members, without taking fractional shares into
      consideration.

20.8  Subject to the Company Act, the Company shall have the right, where it
      deems appropriate to do so and without notice, to purchase by mutual
      agreement all or part of the then issued Class B Preferred Shares, at
      the best possible price. Where only part of the shares are purchased,
      such purchase shall be made on a pro rata basis as set forth hereabove
      or in any other manner as may be agreed upon unanimously by the holders
      of the outstanding Class B Preferred Shares.

20.9  On the date of purchase, the Class B Preferred Shares thus redeemed or
      purchased shall be cancelled.

CLASS C PREFERRED SHARES
- ------------------------

20.10 Class C Preferred Shares may be issued by the directors in one or more
      series, and the directors may, from time to time, by resolution passed:

      (a)   alter the Memorandum of the Company to fix the number of shares
            in, and to determine the designation of the shares of, each
            series; and

      (b)   alter the Memorandum or the Articles of the Company to create,
            define and attach special rights and restrictions to the shares
            of each series, subject to the special rights and restrictions
            attached to the shares of the Class, including without in any way
            limiting or restricting the generality of the foregoing, the
            following:

            (i)   the rate, amount or method of calculation of dividends, if
                  any, and whether the same are subject to adjustments;

            (ii)  whether such dividends are cumulative, partly cumulative or
                  non-cumulative;

            (iii) the dates, manner and currency of payments of dividends and
                  the dates from which dividends accrue or become payable;

            (iv)  if redeemable or purchasable, the redemption or purchase
                  prices and the terms and conditions of redemption or
                  purchase, with or without provision for sinking or similar
                  funds;

            (v)   any conversion, exchange or reclassification rights; and

            (vi)  any other rights, privileges, restrictions and conditions
                  not inconsistent with these provisions.

20.11 The Class C Preferred Shares of each series shall, with respect to the
      payment of dividends and the distribution of assets in the event of the
      liquidation, dissolution or winding-up of the Company, whether
      voluntary or involuntary, or any other distribution of the assets of
      the Company among its members for the purpose of winding-up its
      affairs, rank on a parity with the Class C Preferred Shares of every





                                     - 23 -


      other series and be entitled to a preference over the Class A Common
      Shares, Class B Preferred Shares and any other class ranking junior to
      the Class C Preferred Shares. The Class C Preferred Shares of any
      series shall also be entitled to such other preferences, not
      inconsistent with these provisions, over the Class A Common Shares, the
      Class B Preferred Shares and the shares of any other class ranking
      junior to the Class C Preferred Shares, as may be fixed in accordance
      with Article 20.10.

20.12 The approval of the holders of Class C Preferred Shares as a class, as
      to any matters referred to in these provisions or required by law may
      be given as specified below:

      (a)   any approval given by the holders of the Class C Preferred Shares
            shall be deemed to have been sufficiently given if it shall have
            been given in writing by the holders of all of the outstanding
            Class C Preferred Shares or by a resolution passed at a meeting of
            holders of Class C Preferred Shares duly called and held for such
            purpose upon not less than 21 days' notice at which the holders
            of at least a majority of the outstanding Class C Preferred
            Shares are present or are represented by proxy and carried by the
            affirmative vote of not less than 75% of the votes cast at such
            meeting. If at any such meeting the holders of a majority of the
            outstanding Class C Preferred Shares are not present or
            represented by proxy within 30 minutes after the time appointed
            for such meeting, then the meeting shall be adjourned to such
            date not less than 15 days thereafter and to such time and place
            as may be designated by the chairman of the meeting and not less
            than ten days' written notice shall be given of such adjourned
            meeting but it shall not be necessary in such notice to specify
            the purpose for which the meeting was originally called. At such
            adjournment meeting the holders of Class C Preferred Shares
            present or represented by proxy shall form a quorum and may
            transact the business for which the meeting was originally called
            and a resolution passed thereat by the affirmative vote of not
            less than 75% of the votes cast at such meeting shall constitute
            the approval of the holders of the Class C Preferred Shares;
            and

      (b)   on every poll taken at any such meeting each holder of Class C
            Preferred Shares shall be entitled to one vote in respect of each
            Class C Preferred Share held. Subject to the foregoing, the
            formalities to be observed with respect to the giving or waiving
            of notice of any such meeting and the conduct thereof shall be
            those from time to time prescribed in the Company Act and the
            articles of the Company with respect to meetings of shareholders.

20.13 Except as otherwise provided in the Company Act or these provisions,
      the holders of Class C Preferred Shares shall not, as such, be entitled
      to receive notice of, or attend or vote at, any meeting of the members
      of the Company.



                                         Ontario Corporation Number
                                      Numero de la societe en Ontario
                                      -------------------------------
                                                  1333248



                           ARTICLES OF INCORPORATION
                              STATUS CONSTITUTIFS

1. The name of the corporation is:         Denomination sociale de la societe:

   SUN MEDIA (TORONTO) CORPORATION

2. The address of the registered           Adresse du siege social:
   office is:

   323 KING STREET EAST
- ------------------------------------------------------------------------------
  (Street & Number, or R.R. Number & if Multi-Office Building give Room No.)
 (Rue et numero, ou numero de la R.R. et, s'il s'agit d'un edifice a bureaux,
                             numero du bureau)

   TORONTO, ONTARIO                                    M5A 3X5
- ------------------------------------------------------------------------------
    (Name of Municipality or Post Office)             (Postal Code)
(Nom de la municipalite ou du bureau de poste)        (Code postal)

3. Number (or minimum and maximum number)        Nombre (ou nombres minimal et
   of directors is:                              maximal) d'administrateurs:

        MINIMUM 1, MAXIMUM 20

4. The first director(s) is/are:   Premier(s) administrateur(s);     Resident
                                                                     Canadian
                                   Residence address, giving Street  State
   First name, initials and        & No. or R.R. No.                 Yes/No
   surname                         Municipality and Postal Code.     Resident
   PRENOM, INITIALES ET NOM        Adresse personnelle, y compris    canadien
   DE FAMILLE                      la rue et le numero, le numero    Oui/Non
                                   de la R.R. le nom de la
                                   municipality et le code postal.
- ------------------------------------------------------------------------------
   TRUDY A. EAGAN                  52 CHESTNUT PARK ROAD                YES
                                   TORONTO, ONTARIO M4W 1W8



5. Restrictions, if any, on business        Limites, s'il a lieu, imposees aux
   the corporation may carry on or on       activites commerciales ou aux
   powers the corporation may exercise.     pouvoirs de la societe.

   There are no restrictions on business the Corporation may carry on, or on
   powers the Corporation may exercise.

6. The classes and any maximum number of    Categories et nombre maximal, s'il
   shares that the corporation is           y a lieu, d'actions que la societe
   authorized to issue:                     est autorisee a emettre:

   The Corporation is authorized to issue an unlimited number of shares of
   one class, designated as Common Shares.




7. Rights, privileges, restrictions and     Droits, privileges, restrictions
   conditions (if any) attaching to each    et conditions, s'il y a lieu,
   class of shares and directors            rattaches a chaque categorie
   with respect to any class of shares      d'actions et pouvoirs des
   which may be issued in series:           administrateurs relatifs a chaque
                                            categorie d'actions qui peut etre
                                            emise en serie:

   The rights of the holders of Common Shares of the Corporation are equal
   in all respects and include the rights,

   (a)  to vote at all meetings of shareholders; and

   (b)  to receive the remaining property of the Corporation upon
         dissolution.




8. The issue, transfer or ownership of      L'emission, le transfert ou la
   shares is/is not restricted and the      propriete d'actions est/n'est pas
   restrictions (if any) are as follows:    restreint. Les restrictions, s'il
                                            y a lieu, sont les suivantes:

   No shares of the Corporation shall be transferred without the consent of
   the directors of the Corporation expressed by a resolution passed by the
   board of directors or by an instrument or instruments in writing signed
   by all of the directors then in office.







                                                             
9.         Other provisions, if any are:                        AUTRES DISPOSITIONS, S'IL Y A LIEU:

      (a)  The number of shareholders of the Corporation, exclusive of
           persons who are in the employment of the Corporation and exclusive
           of persons who, having been formerly in the employment of the
           Corporation, were, while in that employment, and have continued
           after termination of that employment to be, shareholders of the
           Corporation, is limited to not more than fifty, two or more
           persons who are the joint registered owners or one or more shares
           being counted as one shareholder.

      (b)  Any invitation to the public to subscribe for securities of the
           Corporation is prohibited.

      (c)  Subject to the provisions of the BUSINESS CORPORATIONS ACT
           (Ontario) as amended or re-enacted from time to time, the
           directors may, without authorization of the shareholders:

           (i)    borrow money on the credit of the Corporation;

           (ii)   issue, re-issue, sell or pledge debt obligations of the
                  Corporation;

           (iii)  give a guarantee on behalf of the Corporation to secure
                  performance of an obligations of any person;

           (iv)   mortgage, hypothecate, pledge or otherwise create a
                  security interest in all or any property of the
                  Corporation, owned or subsequently acquired, to secure any
                  obligation of the Corporation;

                  Nothing in this subparagraph shall limit or restrict the
                  borrowing of money by the Corporation on bills of exchange
                  or promissory notes made, drawn, accepted or endorsed by or
                  on behalf of the Corporation.

           (d)    Except in the case of any class or series of shares of the
                  Corporation listed on a stock exchange, the Corporation
                  shall have a lien on the shares registered in the name of a
                  shareholder or his legal representative for a debt of that
                  shareholder to the Corporation.

           (e)    The holders of any fractional shares issued by the
                  Corporation shall be entitled to exercise voting rights and
                  to receive dividends in respect of each such fractional
                  share.






                                                             
10.  The names and addresses of the incorporations are          NOM ET ADRESSE DES FONDATEURS

                                                                Full residence address or address of registered office
                                                                or of principal place of business giving street & No.
First name, initials and surname or corporate name              or R.R. No., municipality and postal code
PRENOM, INITIALE ET NOM DE FAMILLE OU DENOMINATION              ADRESSE PERSONNELLE AU COMPLET, ADRESSE DU SIEGE
SOCIALE                                                         SOCIAL OU ADRESSE DE L'ETABLISSEMENT PRINCIPAL, Y
                                                                COMPRIS LA RUE ET LE NUMERO, LE NUMERO DE LA R.R., LE
                                                                NOM DE LA MINICIPALITE ET DE CODE POSTAL

- -----------------------------------------------------------------------------------------------------------------------------------

TRUDY A. EAGAN                                                  52 CHESTNUT PARK ROAD
                                                                TORONTO, ONTARIO M4W 1W8










      These articles are signed in duplicate                         LES PRESENTS STATUS SONT SIGNES EN DOUBLE EXEMPLAIRE

- -----------------------------------------------------------------------------------------------------------------------------------
                           Signatures of incorporators / SIGNATUARES DES FONDATEURS



                                            /s/ Trudy A. Eagan
                          ----------------------------------------------------------
                                              TRUDY A. EAGAN









                                                ONTARIO CORPORATION NO. 1333248



                              CERTIFIED COPY OF A
                     SPECIAL RESOLUTION OF THE SHAREHOLDER
                                      OF
                        SUN MEDIA (TORONTO) CORPORATION



     RESOLVED AS A SPECIAL RESOLUTION that the number of directors of the
Corporation be fixed at three, and that the board of directors of the
Corporation be empowered to determine from time to time the number of
directors of the Corporation, such determination to be made by resolution of
the board of directors.

     CERTIFIED to be a true copy of a special resolution of the shareholder
of Sun Media (Toronto) Corporation signed by the sole shareholder entitled to
vote at a meeting of shareholders on the 29th day of December, 1998, which
resolution is in full force and effect, unamended, as of the date thereof.

     DATED the 29th day of December, 1998.



                                          /s/ Trudy A. Eagan
                                          ------------------------------
                                          Trudy A. Eagan
                                          Secretary




[MINISTRY LETTERHEAD]                            Ontario Corporation Number
                                               Numero de la societe en Ontario


                                                          1519309



- -------------------------------------------------------------------------------
              APPLICATION FOR AUTHORIZATION TO CONTINUE IN ANOTHER JURISDICTION
                              DEMANDE D'AUTORISATION DE MAINTIEN
                       SOUS LE REGIME D'UNE AUTRE AUTORITE LEGISLATIVE



                                                               
     1.    The name of the corporation is:                           DENOMINATION SOCIALE DE LA SOCIETE:

- ---------------------------------------------------------------------------------------------------------------------------------
S U N   M E D I A   ( T O R O N T O )   C O R P O R A T I O N
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------

    2.     Date of incorporation/amalgamation:                       DATE DE LA CONSTITUTION OU DE LA FUSION:

                                                        2002, 03, 28
- ---------------------------------------------------------------------------------------------------------------------------------
                                                     (Year, Month, Day)
                                                     (ANNEE, MOIS, JOUR)

3.    The corporation is not offering securities to the              LA SOCIETE OFFRE DES VALEURS AU PUBLIC AU SENS
      public within the meaning of subsection 1(6) of                DU PARAGRAPHE 1(6) DE LA LOI SUR LES SOCIETES PAR ACTIONS.
      the Business Corporations Act.


4.    The corporation is not in default in filing notices            LA SOCIETE A DEPOSE TOUS LES AVIS REQUIS PAR LA LOI SUR LES
      and returns under the Corporations Information Act.            RENSEIGNEMENTS EXIGES DES PERSONNES MORALES.


5.    There are no actions, suits or proceedings pending             AUCUNE ACTION NI AUCUNE INSTANCE N'EST EN COURS CONTRE LA
      against the corporation and no unsatisfied                     SOCIETE ET LES JUGEMENTS OU LES ORDONNANCES A L'ENCONTRE
      judgements or orders outstanding against the                   DE LA SOCIETE ONT ETE EXECUTES A L'EXCEPTION DE CE QUI SUIT:
      corporation, except as follows:


      Not applicable






6.    It is requested that the corporation be authorized             LA SOCIETE DEMANDE L'AUTORISATION AUX TERMES DE L'ARTICLE 181
      under section 181 of the Business Corporations Act             DE LA LOI SUR LES SOCIETES PAR ACTIONS DE S'ADRESSER AU
      to apply to the proper officer for an instrument of            FONCTIONNAIRE COMPETENT POUR OBTENIR UN CERTIFICAT DE
      continuance continuing the corporation as is it had            MAINTIEN LA MAINTENANT DE LA MEME FACON QUE SI ELLE AVAIT
      been incorporated under the laws of                            ETE CONSTITUEE EN VERTU DES LOIS DE/DU


                                                       British Columbia
                                    ----------------------------------------------------------






                                                               
7.    The necessity therefor is as follows:                          LA PRESENT DEMANDE SE FONDE SUR LES MOTIFS SUIVANTS:

      The laws of British Columbia are better adapted to the Corporation's corporate structure and new
      growth and development plan.






8.    The laws of the jurisdiction to which the corporation          LES LOIS DE L'AUTORITE LEGISLATIVE A LAQUELLE LA SOCIETE
      will apply for an instrument of continuance provide in         DEMANDERA UN CERTIFICAT DE MAINTIEN PREVOIENT CE QUI
      effect that:                                                   SUIT:

      (a) The property of the corporation continues to be            (A) LES BIENS DE LA SOCIETE DEVIENNENT LES BIENS DE LA
          the property of the body corporate;                            PERSONNE MORALE;

      (b) The body corporate continues to be liable for the          (B) LA PERSONNE MORALE CONTINUE D'ETRE TENUE DES
          obligations of the corporation;                                OBLIGATIONS DE LA SOCIETE;

      (c) An existing cause of action, claim or liability to         (C) LE MAINTIEN N'A PAS DE CONSEQUENCE SUR LES CAUSES
          prosecution is unaffected;                                     D'ACTION, LES CREANCES ET LES POURSUITES DONT LA
                                                                         SOCIETE EST PASSIBLE;

      (d) A civil, criminal, or administrative action or             (D) LES INSTANCES CIVILES, PENALES OU ADMINISTRATIVES
          proceeding pending by or against the corporation               AUXQUELLES LA SOCIETE EST PARTIE PEUVENT ETRE
          may be continued to be prosecuted by or against                CONTINUEES PAR LA PERSONNE MORALE OU CONTRE ELLE; ET
          the body corporate; and

      (e) A conviction against the corporation may be enforced       (E) LES CONDAMNATIONS PRONONCEES A L'ENCONTRE DE LA SOCIETE
          against the body corporate or a ruling, order or               SONT SUSCEPTIBLES D'EXECUTION A L'ENCONTRE DE LA PERSONNE
          judgement in favour of or against the corporation may          MORALE ET LES ORDINNANCES OU LES JUGEMENTS PRONONCES EN
          be enforced by or against the body corporate.                  FAVEUR DE LA SOCIETE OU CONTRE ELLE SONT SUSCEPTIBLES
                                                                         D'EXECUTION PAR LA PERSONNE MORALE OU CONTRE ELLE.





9.    This application has been authorized by a special              LA PRESENTE DEMANDE A ETE AUTORISEE PAR RESOLUTION
      resolution.                                                    SPECIALE.


10.   This application is accompanied by the consent of:             LA PRESENTE DEMANDE EST ACCOMPAGNEE DU CONSENTEMENT:

      (a) The Corporations Tax Branch of the Ministry of             (a) D'UNE PART, DE LA DIRECTION DE L'IMPOSITION DES
          Finance.                                                       CORPORATIONS DU MINISTERE DES FINANCES.


This application is signed in duplicate.                             LA PRESENTE DEMANDE EST SIGNEE EN DOUBLE EXEMPLAIRE.

                                                                              SUN MEDIA (TORONTO) CORPORATION
                                                                    ----------------------------------------------------
                                                                                   (Name of Corporation)
                                                                           (DENOMINATION SOCIALE DE LA SOCIETE)



                                                                    By:/PAR:   /s/ Louis Saint Arnaud
                                                                            ---------------------------------------------
                                                                              (Signature)         (Description of Office)
                                                                              (SIGNATURE)               (FONCTION)








MINISTRY OF FINANCE       MINISTERE DES FINANCES

Corporations Tax          Direction de l'imposition     [ONTARIO TRILLIUM LOGO]
Branch                    des compagnies                OSHAWA (905)433-6578
33 King Street West       33 rue King ouest             TORONTO (416)920-9048
PO Box 622                CP 622                                Ext.6576
Oshawa ON L1H 8H6         Oshawa ON L1H 8H6             ONTARIO & QUEBEC
                                                        1-800-262-0784 Ext.6576



November 5, 2002

Ogilvy Renault, Barristers & Solicitors
1981 McGill College Avenue
Suite 1100
Montreal, Quebec  H3A 3C1

Attention: Michelle Gagne

Dear Madam or Sir:

Re:   Sun Media (Toronto) Corporation
      Account Number 8135930
      Consent - Transfer of Ontario Corporation

In accordance with the Business Corporations Act, we are pleased to advise
you that the Corporations Tax Branch of the Ministry of Finance consents to
the issuance of an instrument of continuation to Sun Media (Toronto)
Corporation, continuing the company as if it were incorporated under the laws
of the Government of British Columbia.

This consent is only valid for sixty days from the date of this letter and
must be filed within this specified period with the Companies Branch,
Ministry of Consumer and Business Services.

Please be advised that, if the corporation intends to continue to conduct
business in Ontario, it is required that the corporation file a Form 2 with
the:

                  Ministry of Consumer and Business Services
                               Companies Branch
                       393 University Avenue, Suite 200
                           Toronto, Ontario M5G 2M2
                       (416) 314-8880 or 1-800-361-3223

The Form 2 is available on the internet at:
http://www.cbs.gov.on.ca/mcbs/english/4VWQQC.htm

For your assistance, I have attached guidelines for Authorization to Continue
in Another Jurisdiction.

Your truly,


/s/ [illegible]
Tax Roll Services Representative
Tax Roll Administration Unit
Corporations Tax Branch





                                      1.

                                                                    
                                  For Ministry Use Only                                               ONTARIO CORPORATION NUMBER
                             A L'USAGE EXCLUSIF DU MINISTERE                                      NUMERO DE LA COMPAGNIE EN ONTARIO

                                                                                                               1519309

                             

                      [DATE STAMP]


                              -----------------------------------------------------------------------------------------------------
                                                                     ARTICLES OF AMALGAMATION
                                                                        STATUTS DE FUSION
                                                                                     
           Form 4
          Business            1. The name of the amalgamated corporation is:               DENOMINATION SOCIALE DE LA COMPAGNIE
        Corporations                                                                       ISSUE DE LA FUSION:
            Act               -----------------------------------------------------------------------------------------------------
                               S U N   M E D I A   ( T O R O N T O )   C O R P O R A T I O N
                              -----------------------------------------------------------------------------------------------------

          FORMULE             -----------------------------------------------------------------------------------------------------
         NUMERO 4
        LOI SUR LES           -----------------------------------------------------------------------------------------------------
        COMPAGNIES
                              -----------------------------------------------------------------------------------------------------

                              2. The address of the registered office is:                  ADRESSE DU SIEGE SOCIAL:

                                                                     333 KING STREET EAST
                              -----------------------------------------------------------------------------------------------------
                                           (Street & Number, or R.R. Number & if Multi-Office Building give Room No.)
                                   (RUE ET NUMERO, OU NUMERO DE LA R.R. ET, S'IL S'AGIT EDIFICE A BUREAUX, NUMERO DU BUREAU)

                                                                        TORONTO, ONTARIO                                  M 5 A 3 X
                              -----------------------------------------------------------------------------------------------------
                                                (Name of Municipality - Post Office)                      (Postal Code/CODE POSTAL)
                                           (NOM DE LA MUNICIPALITE OU DU BUREAU DE POSTE)




                              3. Number (or minimum and maximum number)                      NOMBRE (OU NOMBRES MINIMAL ET MAXIMAL)
                                 of directors                                                D'ADMINISTRATEURS:

                                 MINIMUM 1, MAXIMUM 20

                              4. The director(s) is/are:                                     ADMINISTRATEUR(S):




                                                                                                                       Resident
                                                                                                                       Canadian
                                                                Address for service, giving Street & No. or R.R. No.,  State
                              First name, initials and surname  Municipality and Postal Code                           Yes or No
                              PRENOM, INITIALES ET NOM DE       DOMICILE ELU, Y COMPRIS LA RUE ET LE NUMERO,           RESIDENT
                              FAMILLE                           LE NUMERO DE LE R.R. OU LE NOM DE LA MUNICIPALITE      CANADIEN
                                                                ET LE CODE POSTAL                                      OUI/NON
                              -----------------------------------------------------------------------------------------------------
                                                                                                                 
                               PIERRE FRANCOEUR                 177, RUE CHAMONIX                                        YES
                                                                SAINTE-ADELE, QUEBEC J0R 1L0

                               TRUDY A. EAGAN                   52 CHESTNUT PARK ROAD                                    YES
                                                                TORONTO, ONTARIO M4W 1W8

                               KIN-MAN LEE                      50 KANATA CRESCENT                                       YES
                                                                LONDON, ONTARIO N6J 4S6



                                                                             2.
                                                                               
                              5. (A) The amalgamation agreement has been duly        (A) LES ACTIONNAIRES DE CHAQUE COMPAGNIE QUI
                                     adopted by the shareholders of each of the          FUSIONNE ONT DUMENT ADOPTE LA CONVENTION
                                     amalgamating corporations as required by            DE FUSION CONFORMEMENT AU PARAGRAPHE 176
                                     subsection 176 (4) of the Business                  (4) DE LA LOI SUR LES COMPAGNIES A LA DATE
                                     Corporations Act on the date set out below.         MENTIONNEES CI-DESSOUS.



                                                                          [GRAPHIC]



                                 (B) The amalgamation has been approved by the       (B) LES ADMINISTRATEURS DE CHAQUE COMPAGNIE
                                     directors of each amalgamating corporation          QUI FUSIONNE ONT APPROUVE LA FUSION PAR
                                     by a resolution as required by section 177          VOIE DE RESOLUTION CONFORMEMENT A
                                     of the Business Corporations Act on the date        L'ARTICLE 177 DE LA LOI SUR LES
                                     set out below.                                      COMPAGNIES A LA DATE MENTIONNEE
                                                                                         CI-DESSOUS.
                                     The articles of amalgamation in substance           LES STATUTS DE FUSION REPRENNENT
                                     contain the provisions of the articles of           ESSENTIELLEMENT LES DISPOSITIONS DES
                                     incorporation of                                    STATUTS CONSTITUTIFS DE


                                                                 SUN MEDIA (TORONTO) CORPORATION
                              -----------------------------------------------------------------------------------------------------
                                     and are more particularly set out in these          ET SONT ENONCES TEXTUELLEMENT AUX PRESENTS
                                     articles.                                           STATUTS.





                                Names of amalgamating          Ontario Corporation Number      Date of Adoption/Approval
                                corporations                   NUMERO DE LA COMPAGNIE EN       DATE D'ADOPTION OU D'APPROBATION
                                DENOMINATION SOCIALE DES       ONTARIO
                                COMPAGNIES QUI FUSIONNENT
                              -----------------------------------------------------------------------------------------------------
                                                                                      
                              SUN MEDIA (TORONTO)              1333248                         MARCH 27, 2002
                              CORPORATION




                              THE RECORDER AND                 964235                          MARCH 27, 2002
                              TIMES LIMITED




                                      3.
                                                                               
                              6. Restrictions, if any, on business the corporation   LIMITES, S'IL Y A LIEU, IMPOSEES AUX ACTIVITES
                                 may carry on or on powers the corporation may       COMMERCIALES OU AUX POUVOIRS DE LA COMPAGNIE.
                                 exercise.

                                 NONE
























                              7. The classes and any maximum number of shares that   CATEGORIES ET NOMBRE MAXIMAL, S'IL Y A LIEU,
                                 the corporation is authorized to issue:             D'ACTIONS QUE LA COMPAGNIE EST AUTORISEE A
                                                                                     EMETTRE:

                                 The Corporation is authorized to issue the following classes of shares:

                                 a) an unlimited number of common shares;

                                 b) an unlimited number of Class A shares;

                                 c) an unlimited number of Class B shares;

                                 d) an unlimited number of Class C shares;

                                 e) an unlimited number of Class D shares;

                                 f) an unlimited number of Class E shares; and

                                 g) an unlimited number of Class F shares.






                                                                            4.

8  Rights, privileges, restrictions and      DROITS, PRIVILEGES, RESTRICTIONS
   conditions (if any) attaching to each     ET CONDITIONS, S'IL Y A LIEU,
   class of shares and directors authority   RATTACHES A CHAQUE CATEGORIE
   with respect to any class of shares       D'ACTIONS ET POUVOIRS DES
   which may be issued in series:            ADMINISTRATEURS RELATIFS A CHAQUE
                                             CATEGORIE D'ACTIONS QUI PEUT ETRE
                                             EMISE EN SERIE:

8.1    CLASS A SHARES, CLASS B SHARES AND CLASS C SHARES

8.1.a  In the event of the liquidation, dissolution or winding up of the
       Corporation or other distribution of assets of the Corporation among
       shareholders for the purpose of winding up its affairs, before payment
       to the holders of any other class of shares, the holders of the Class
       A shares shall shall be entitled to receive from the assets and
       property of the Corporation the Redemption Amount as provided for in
       Clause 8.1.h hereof, together with all declared and unpaid dividends,
       before any amount shall be paid or any property or assets of the
       Corporation distributed to the holders of Class B shares and Class C
       shares. After such payment to the holders of the Class A shares, the
       holders of the Class B shares shall be entitled to receive the
       Redemption Amount as provided for in Clause 8.1.h hereof, together
       with all declared and unpaid dividends, before any amount shall be
       paid or any property or assets of the Corporation distributed to the
       holders of the Class C shares. After such payment to the holders of
       the Class A shares and Class B shares, the holders of the Class C
       shares shall be entitled to receive the Redemption Amount as provided
       for in Clause 8.1.h hereof, together with any declared and unpaid
       dividends and no more. Once the above amounts payable to holders of
       the Class A shares, the Class B shares and the Class C shares have
       been paid as above provided, they shall not be entitled to share in
       any further distribution of the property or assets of the Corporation.

8.1.b  The directors may from time to time and in their sole discretion
       declare and the Corporation shall pay dividends on any class of shares
       of the Corporation in such amounts and on such date or dates as may be
       determined by the directors except that dividends payable on Class A
       shares, Class B shares and Class C shares shall not exceed the annual
       rate of 12% of their Redemption Amount; and provided that in any year
       the directors shall not declare and the Corporation shall not pay any
       dividends on any shares of any class ranking junior to the Class A
       shares, Class B shares and Class C shares or redeem or purchase for
       cancellation or make a capital distribution in respect of any other
       class ranking junior to the Class A shares, Class B shares and Class C
       shares, unless after giving effect to such action an amount equal to
       the product obtained by multiplying the aggregate number of Class A
       shares, Class B shares and Class C shares issued and outstanding at
       the time of such action by




                                                                           4-A


       $1.00 is less than or equal to the amount, if any, by which the
       shareholder's equity of the Corporation exceeds the paid up capital of
       the Corporation; and in calculating shareholders' equity of the
       Corporation, adjustments shall be made to reflect the market value of
       the assets of the Corporation.

8.1.c  The holders of the Class A shares, Class B shares and Class C shares
       shall not be entitled to receive notice of, to attend or to vote at
       any meetings of the shareholders of the Corporation except meetings of
       the holders of Class A shares, Class B shares or Class C shares.

8.1.d  The Corporation may, upon giving notice as hereinafter provided,
       redeem at any time the whole or from time to time any part of the then
       outstanding Class A shares, Class B shares or Class C shares on
       payment for each share to be redeemed of the Redemption Amount as set
       out in Clause 8.1.h, together with all declared and unpaid
       non-cumulative dividends thereon.

8.1.e  In the case of redemption of Class A shares, Class B shares or Class C
       shares under the provisions of Clause 8.1.d herein, the Corporation
       shall at least thirty (30) days before the date specified for
       redemption, mail to each person who at the date of mailing is a
       registered holder of Class A shares, Class B shares or Class C shares
       to be redeemed, a notice in writing of the intention of the
       Corporation to redeem such Class A shares, Class B shares or Class C
       shares. Such notice shall be mailed in a postage prepaid letter
       addressed to each such holder at his address as it appears on the
       books of the Corporation or in the event of the address of any such
       shareholder not so appearing, then to the last known address of such
       shareholder; provided however, that accidental failure to give any
       such notice to one or more of such shareholders shall not affect the
       validity of such redemption. Such notice shall set out the Redemption
       Amount and the date on which redemption is to take place, and if only
       part of the shares held by the person to whom it is addressed is to be
       redeemed, the number thereof so to be redeemed. On or after the date
       so specified for redemption, the Corporation shall pay or cause to be
       paid to or to the order of the registered holders of the Class A
       shares, Class B shares or Class C shares to be redeemed the amount
       payable in accordance with Clause 8.1.h on presentation and surrender
       at the head office of the Corporation or any other place designated in
       such notice of the




                                                                           4-B

       certificate representing the Class A shares, Class B shares or Class C
       shares called for redemption. If part only of the shares represented
       by any certificate are to be redeemed, a new certificate for the
       balance shall be issued at the expense of the Corporation. From and
       after the dates specified in any such notice, the Class A shares,
       Class B shares or Class C shares called for redemption shall cease to
       be entitled to dividends and the holders thereof shall not be entitled
       to exercise any of the rights of shareholders in respect thereof
       unless payment of the amount payable in accordance with Clause 8.1.h
       shall not be made upon presentation of certificates in accordance with
       the foregoing provisions, in which case the rights of the shareholders
       shall remain unaffected. The Corporation shall have the right at any
       time after the mailing of notice of its intention to redeem any Class
       A shares, Class B shares or Class C shares to deposit the amount
       payable in accordance with Clause 8.1.h in respect of the said shares
       represented by certificates which have not at the date of such deposit
       been surrendered by the holders thereof in connection with such
       redemption, to a special account at any chartered bank or trust
       company in Canada named in such notice, to be paid without interest to
       or to the order of the respective holders of such Class A shares,
       Class B shares or Class C shares called for redemption, upon
       presentation and surrender to such bank or trust company of the
       certificates representing the same and, upon such deposit being made
       or upon the date specified for redemption in such notice whichever is
       the later, the Class A shares, Class B shares or Class C shares in
       respect whereof such deposit shall have been made shall be redeemed
       and the rights of the holders thereof after such deposit or such
       redemption date, as the case may be, shall be limited to receiving
       without interest their proportionate part of the total amount so
       deposited against presentation and surrender of the said certificates
       held by them respectively.

8.1.f  The holder of the Class A shares, Class B shares or Class C shares
       may, upon giving notice as hereinafter provided in Clause 8.1.g, require
       the Corporation to redeem the whole or from time to time any part of
       the then outstanding Class A shares, Class B shares or Class C shares
       at the Redemption Amount as set out in Clause 8.1.h, together with all
       declared and unpaid non-cumulative dividends thereon.

8.1.g  In the case of a redemption pursuant to Clause 8.1.f herein, a holder
       of Class A shares, Class B shares or




                                                                           4-C


       Class C shares shall be entitled to require the Corporation to redeem
       at any time or times, all or any of the Class A shares, Class B shares
       or Class C shares registered in the name of such holders on the books
       of the Corporation by tendering to the Corporation at its head office
       a share certificate or certificates representing the Class A shares,
       Class B shares or Class C shares which the registered holder desires
       to have the Corporation redeem together with a request in writing
       specifying (a) that the registered holder desires to have the Class A
       shares, Class B shares or Class C shares represented by such
       certificate or certificates redeemed by the Corporation and (b) the
       business day (in this clause referred to as the "Redemption Date") on
       which the holder desires to have the Corporation redeem such Class A
       shares, Class B shares or Class C shares. Requests in writing shall
       specify a Redemption Date which shall not be less than thirty (30)
       days after the day on which the request in writing is given to the
       Corporation. Upon receipt of a share certificate or certificates
       representing the Class A shares, Class B shares or Class C shares
       which the registered holder desires to have the Corporation redeem
       together with such a request, the Corporation shall on the Redemption
       Date redeem such Class A shares, Class B shares or Class C shares by
       paying to such registered holder for each such share an amount equal
       to the Redemption Amount as set out in Clause 8.1.h plus all declared
       and unpaid non-cumulative dividends thereon. Such payment shall be
       made by cheque payable at par at any branch of the Corporation's
       bankers for the time being in Canada. The said Class A shares, Class B
       shares or Class C shares shall be redeemed on the Redemption Date and
       from and after the Redemption Date such shares shall cease to be
       entitled to dividends, and the holders thereof shall not be entitled
       to exercise any of the rights of the holders of Class A shares, Class
       B shares or Class C shares in respect thereof unless payment of the
       amount payable as aforesaid is not made on the Redemption Date, in
       which event the rights of the holders of the said shares shall remain
       unaffected.

8.1.h  The Redemption Amount of each Class A share, Class B share or Class C
       share shall be One Dollar ($1.00).

8.2    CLASS D VOTING SHARES

8.2.a  In the event of the liquidation, dissolution or winding-up of the
       Corporation or other distribution of




                                                                           4-D

       property or assets of the Corporation among shareholders for the
       purpose of winding-up its affairs, the holders of the Class D Voting
       shares shall be entitled to receive from the property and assets of
       the Corporation, after payment to the holders of the Class A shares,
       Class B shares or Class C shares as hereinbefore provided, an amount
       equal to $1.00 per share, together with all declared and unpaid
       dividends thereon, before any amount shall be paid or any property or
       assets of the Corporation distributed to the holders of any Common
       shares or shares of any other class ranking junior to the Class D
       Voting shares. After payment to the holders of the Class D Voting
       shares of the amounts so payable to them as provided above, they shall
       not be entitled to share in any further distribution of the property
       or assets of the Corporation.

8.2.b  The holders of the Class D Voting shares shall not be entitled to
       receive dividends.

8.2.c  The holders of the Class D Voting shares shall be entitled to one (1)
       vote for each Class D Voting share held by them at all shareholders'
       meetings.

8.3    CLASS E COMMON SHARES

8.3.a  In the event of the liquidation, dissolution or winding-up of the
       Corporation, whether voluntary or involuntary, the holders of the
       Class E Common shares shall be entitled to receive, after payment to
       the holders of the Class A shares, Class B shares, Class C shares
       and Class D Voting shares as hereinbefore provided, the remaining
       assets and property of the Corporation.

8.3.b  The holders of the Class E Common shares shall not be entitled to
       receive notice of, to attend or to vote at any meetings of the
       shareholders of the Corporation except meetings of the holders of
       Class E Common shares.

8.3.c  The holders of the Class E Common shares shall be entitled, subject to
       Clause 8.1.b, to receive dividends as and when the Directors shall in
       their discretion declare dividends on the Class E Common shares and
       pay the same.




                                                                         4-E

8.4      CLASS F SHARES
The rights, privileges, restrictions and conditions attaching to the Class F
shares are as follows:

8.4.a    the holders of the Class F shares shall in each year, in the
         discretion of the directors, be entitled, out of any or all profits
         or surplus available for dividends, to non-cumulative dividends in
         an amount of 6% per annum of the Redemption Amount (as hereinafter
         defined); the holders of Class F shares shall not be entitled to any
         dividend other than or in excess of the non-cumulative dividends at
         the said rate hereinbefore provided for and in any financial year
         the directors in their discretion shall not declare a dividend or
         any part thereof on the Class F shares then the right of the holders
         of the Class F shares to such dividend or any greater dividend than
         the dividend actually declared for such financial year shall be
         forever extinguished;

8.4.b    The Redemption Amount of each Class F share shall be $1.00 (the
         "Redemption Amount");

8.4.c    The Corporation may, upon giving notice as hereinafter provided,
         redeem the whole or any part of the Class F shares on payment for
         each share to be redeemed of the Redemption Amount, together with
         all dividends declared thereon and unpaid, the whole constituting
         and being herein referred to as the "Redemption Price"; not less
         than thirty (30) days' notice in writing of such redemption shall be
         given by mailing such notice to the registered holders of the Class
         F shares to be redeemed, specifying the date and place or places of
         redemption; if notice of any such redemption be given by the
         Corporation in the manner aforesaid and an amount sufficient to
         redeem the shares be deposited with any trust company or chartered
         bank in Canada, as specified in the notice, on or before the date
         fixed for redemption, dividends on the Class F shares to be redeemed
         shall cease after the date so fixed for redemption, and the holders
         thereof shall thereafter have no rights against the Corporation in
         respect thereof except, upon the surrender of certificates for such
         shares, to receive payment therefor out of the moneys so deposited;
         provided that, if payment of the Redemption Price is not made on the
         redemption date, the rights of the holder of the said Class F shares
         shall remain unaffected until payment of the Redemption Price is
         made. If less than all of the Class F shares represented by any
         certificate or certificates are to be redeemed, the registered
         holder shall be entitled to receive, at the expense of the
         Corporation, a new certificate representing the Class F shares
         comprised in the certificate or certificates surrendered as
         aforesaid which are not to be redeemed;


                                                                         4-F

8.4.d    any holder of Class F shares shall be entitled to require the
         Corporation to redeem at any time or times all or any of the Class F
         shares registered in the name of such holder on the books of the
         Corporation by tendering to the Corporation a share certificate or
         certificates representing the Class F shares which the registered
         holder desires to have the Corporation redeem together with a
         request in writing specifying

         (A)   that the registered holder desires to have all or any of the
               Class F shares represented by such certificate or certificates
               redeemed by the Corporation, and

         (B)   the business day, being not less than fourteen (14) days and
               not more than thirty (30) days from the date of giving such
               notice to the Corporation (in this paragraph referred to as
               the "redemption date") on which the holder desires to have the
               Corporation redeem such Class F shares.

         Upon receipt of a share certificate or certificates representing the
         Class F shares which the registered holder desires to have the
         Corporation redeem together with such a request, the Corporation
         shall on the redemption date redeem such Class F shares by paying to
         such registered holder the Redemption Price in respect of each Class
         F share redeemed, such payment to be made by cheque payable at par
         at any branch of the Corporation's bank for the time being in
         Canada. The said Class F shares shall be redeemed on the redemption
         date and thereafter the holder of such Class F shares shall not be
         entitled to exercise any of the rights of holders of Class F shares
         in respect thereof; provided that, if payment of the Redemption
         Price is not made on the redemption date, the rights of the holder
         of the said Class F shares shall remain unaffected until payment of
         the Redemption Price is made. If less than all of the Class F shares
         represented by any certificate or certificates are to be redeemed,
         the registered holder shall be entitled to receive, at the expense
         of the Corporation, a new certificate representing the Class F
         shares comprised in the certificate or certificates surrendered as
         aforesaid which are not to be redeemed;

8.4.e    in the event of the liquidation, dissolution of winding-up of the
         Corporation, whether voluntary or involuntary, the holders of the
         Class F shares shall be entitled to receive, before any distribution
         of any part of the assets of the Corporation among the holders of
         any of the other classes of shares of the Corporation other than the
         Class A shares, Class B shares, and the Class C shares, an amount
         per share equal to the Redemption Price in respect of each Class F
         share, and no more;


                                                                           4-G

8.4.f    except as provided by the Business Corporation Act, as amended from
         time to time, the holders of the Class F shares shall not be
         entitled to receive a notice of or to attend any meetings of the
         shareholders of the Corporation and shall not be entitled to vote at
         any meetings of the shareholders of the Corporation but shall be
         entitled to notice of meetings of shareholders called for the
         purpose of authorizing the dissolution of the Corporation or the
         sale, lease or exchange of all or substantially all the property of
         the Corporation other than in the ordinary course of business of the
         Corporation.



8.5      COMMON SHARES

         The rights, privileges, restrictions and conditions attaching to the
common shares are as follows:

8.5.a    Payment of Dividends: The holders of the common shares shall be
         entitled to receive dividends if, as and when declared by the board
         of directors of the Corporation out of the assets of the Corporation
         properly applicable to the payment of dividends in such amounts and
         payable in such manner as the board of directors may from time to
         time determine. Subject to the rights of the holders of any other
         class of shares of the Corporation entitled to receive dividends in
         priority to or concurrently with the holders of the common shares,
         the board of directors may in its sole discretion declare dividends
         on the common shares to the exclusion of any other class of shares
         of the Corporation.

8.5.b    Participation upon Liquidation, Dissolution or Winding Up: In the
         event of the liquidation, dissolution or winding up of the
         Corporation or other distribution of assets of the Corporation among
         its shareholders for the purpose of winding up its affairs, the
         holders of the common shares shall, subject to the rights of the
         holders of any other class of shares of the Corporation entitled to
         receive assets of the Corporation upon such a distribution in
         priority to or concurrently with the holders of the common shares,
         be entitled to participate in the distribution. Such distribution
         shall be made in equal amounts per share on all the common shares at
         the time outstanding without preference or distinction.

8.5.c    Voting Rights: The holders of the common shares shall be entitled to
         receive notice of and to attend all annual and special meetings of
         the shareholders of the Corporation and to one vote in respect of
         each common share held at all such meetings.


                                                                            5.

                                                                 
9.       The issue, transfer or ownership of shares is/is not          L'EMISSION, LE TRANSFERT OU LA PROPRIETE D'ACTIONS EST/N'EST
         restricted and the restrictions (if any) are as follows:      PAS RESTREINTE. LES RESTRICTIONS, S'IL Y A LIEU, SONT LES
                                                                       SUIVANTES:



         No share in the capital of the Corporation shall be transferred
         without the consent of the directors expressed by the votes of a
         majority of the directors at a meeting of the directors or by an
         instrument or instruments in writing signed by a majority of the
         directors.









10.      Other provisions, (if any):        AUTRES DISPOSITIONS, S'IL Y A LIEU:

(1)      The number of shareholders of the Corporation, exclusive of persons
         who are in its employment and exclusive of persons who, having been
         formerly in the employment of the Corporation, were, while in that
         employment and have continued after the termination of that
         employment to be, shareholders of the Corporation, is limityed to
         not more than 50, two or more persons who are the joint registered
         owners of one or more shares being counted as one shareholder.

(2)      Any invitation to the public to subscribe for securities of the
         Corporation is prohibited.









                                                           
11.      The statements required by subsection 178(2) of the     LES DECLARATIONS EXIGEES AUX TERMES DU PARAGRAPHE 178(2)
         Business Corporations Act are attached as Schedule      DE LA LOI SUR LES COMPAGNIES CONSTITUENT L'ANNEXE "A"
         "A"

12.      A copy of the amalgamation agreement or directors       UNE COPIE DE LA CONVERSION DE FUSION OU LES RESOLUTIONS DES
         resolutions (as the case may be) is/are attached as     ADMINISTRATEURS (SELON LE CAS) CONSTITUE(NT) L'ANNEXE "B"
         Schedule "B"





                                                                             6
                                                     
         These articles are signed in duplicate.                 LES PRESENTS STATUTS SONT SIGNES EN DOUBLE EXEMPLAIRE.












         -------------------------------------------------------------------------------------------------------------------------
         Names of the amalgamating corporations are              DENOMINATION SOCIALE DES COMPAGNIES QUI FUSIONNENT
         signatures and descriptions of office of their          SIGNATURE ET FONCTION DE LEURS DIRIGEANTS REGULIEREMENT
         proper officers.                                        DESIGNES.


         SUN MEDIA (TORONTO) CORPORATION





         Per: [Illegible]
              ------------------------------------


         THE RECORDER AND TIMES LIMITED





         Per: [Illegible]
              ------------------------------------


         



                                                                              7.
                                  SCHEDULE "A"

                       STATEMENT OF DIRECTOR OR OFFICER

     The undersigned, being the President of Sun Media (Toronto) Corporation,
one of the amalgamating corporations (hereinafter called the "Corporation"),
hereby states and certifies that there are reasonable grounds for believing
that:

1.   the Corporation is, and the corporation continuing from the amalgamation
     of the Corporation and The Recorder and Times Limited (the "Amalgamated
     Corporation") will be able to pay its liabilities as they become due;

2.   the realizable value of the Amalgamated Corporation's assets will not be
     less than the aggregate of its liabilities and stated capital of all
     classes; and

3.   no creditor of the Corporation will be prejudiced by the amalgamation.

     This statement is made and attached to the articles of amalgamation of
the Amalgamated Corporation pursuant to subsection 178(2) of the BUSINESS
CORPORATIONS ACT (Ontario).

     DATED the 27th day of March, 2002.


                                             /s/ Pierre Francoeur
                                       -----------------------------------
                                       Pierre Francoeur, President




                                                                              8.

                                  SCHEDULE "A"

                       STATEMENT OF DIRECTOR OR OFFICER

     The undersigned, being the President of The Recorder and Times Limited,
one of the amalgamating corporations (hereinafter called the "Corporation"),
hereby states and certifies that there are reasonable grounds for believing
that:

1.   the Corporation is, and the corporation continuing from the amalgamation
     of the Corporation and Sun Media (Toronto) Limited (the "Amalgamated
     Corporation") will be able to pay its liabilities as they become due;

2.   the realizable value of the Amalgamated Corporation's assets will not be
     less than the aggregate of its liabilities and stated capital of all
     classes; and

3.   no creditor of the Corporation will be prejudiced by the amalgamation.

     This statement is made and attached to the articles of amalgamation of
the Amalgamated Corporation pursuant to subsection 178(2) of the BUSINESS
CORPORATIONS ACT (Ontario).

     DATED the 27th day of March, 2002.


                                             /s/ William R. Dempsey
                                       -----------------------------------
                                       William R. Dempsey, President




                                                                              9.


                               SCHEDULE "B"

                RESOLUTION APPROVING THE AMALGAMATION

     WHEREAS The Recorder and Times Limited (the "Corporation") has agreed to
amalgamate with Sun Media (Toronto) Corporation, pursuant to Section 177(2)
of the BUSINESS CORPORATIONS ACT (Ontario):

     BE IT RESOLVED THAT:

1.   The amalgamation of the Corporation with Sun Media (Toronto) Corporation
     under the BUSINESS CORPORATIONS ACT (Ontario) pursuant to Section 177(2)
     thereof, be and the same is hereby approved;

2.   Effective upon issuance of a Certificate of Amalgamation pursuant to
     Section 178 of the BUSINESS CORPORATIONS ACT (Ontario), and without
     affecting the validity of the incorporation and existence of the
     Corporation under its articles of incorporation and of any act done
     thereunder, all shares of the authorized capital of The Recorder and
     Times Limited, including all such shares which have been issued and are
     outstanding at the date hereof, be and the same are hereby cancelled
     without repayment of capital in respect thereof.;

3.   The by-laws of the amalgamated corporation shall be the same as the
     by-laws of Sun Media (Toronto) Corporation;

4.   The Articles of Amalgamation of the amalgamated corporation shall be the
     same as the articles of Sun Media (Toronto) Corporation;

5.   The stated capital of The Recorder and Times Limited shall be added to
     the stated capital of Sun Media (Toronto) Corporation upon amalgamation;
     and

6.   The proper officers of the Corporation be and they are hereby authorized
     to do all things and execute all instruments and documents necessary or
     desirable to carry out and give effect to the foregoing.

     I, William R. Dempsey, the President of The Recorder and Times Limited,
hereby certify that the foregoing is a true and correct copy of a resolution
of the Board of Directors of The Recorder and Times Limited and that such
resolution is in full force and effect.

     DATED the 27th day of March, 2002


                                          /s/ William R. Dempsey
                                       ------------------------------
                                       William R. Dempsey, President




                                                                             10.


                               SCHEDULE "B"

                RESOLUTION APPROVING THE AMALGAMATION

     WHEREAS Sun Media (Toronto) Corporation (the "Corporation") has agreed
to amalgamate with The Recorder and Times Limited pursuant to Section 177(2)
of the BUSINESS CORPORATIONS ACT (Ontario):

     BE IT RESOLVED THAT:

1.   The amalgamation of the Corporation with The Recorder and Times Limited
     under the BUSINESS CORPORATIONS ACT (Ontario) pursuant to Section 177(2)
     thereof, be and the same is hereby approved;

2.   Effective upon issuance of a Certificate of Amalgamation pursuant to
     Section 178 of the BUSINESS CORPORATIONS ACT (Ontario), and without
     affecting the validity of the incorporation and existence of the
     Corporation under its articles of incorporation and of any act done
     thereunder, all shares of the authorized capital of The Recorder and
     Times Limited, including all such shares which have been issued and are
     outstanding at the date hereof, be and the same are hereby cancelled
     without repayment of capital in respect thereof;

3.   The by-laws of the amalgamated corporation shall be the same as the
     by-laws of Sun Media (Toronto) Corporation;

4.   The Articles of Amalgamation of the amalgamated corporation shall be the
     same as the articles of Sun Media (Toronto) Corporation;

5.   The stated capital of The Recorder and Times Limited shall be added to
     the stated capital of Sun Media (Toronto) Corporation upon amalgamation;
     and

6.   The proper officers of the Corporation be and they are hereby authorized
     to do all things and execute all instruments and documents necessary or
     desirable to carry out and give effect to the foregoing.

     I, Pierre Francoeur, the President of Sun Media (Toronto) Corporation,
hereby certify that the foregoing is a true and correct copy of a resolution
of the Board of Directors of Sun Media (Toronto) Corporation and that such
resolution is in full force and effect.

     DATED the 27th day of March, 2002


                                           /s/ Pierre Francoeur
                                       ------------------------------
                                       Pierre Francoeur, President

EX-3.8

                                                                Exhibit 3.8


                                  SCHEDULE 2
                                  ----------

                                   ARTICLES
                                      OF
                       SUN MEDIA (TORONTO) CORPORATION




                             TABLE OF CONTENTS
                             -----------------

PART 1 - INTERPRETATION ..................................................  1
PART 2 - ISSUE OF SHARES .................................................  1
PART 3 - SHARE OF CERTIFICATES ...........................................  2
PART 4 - TRANSFER OF SHARES, GENERAL .....................................  3
PART 5 - TRANSMISSION OF SHARES ..........................................  3
PART 6 - BORROWING AND CAPITAL ...........................................  4
PART 7 - MEETINGS ........................................................  5
PART 8 - PROCEEDINGS AT GENERAL MEETINGS .................................  6
PART 9 - VOTES OF MEMBERS ................................................  8
PART 10 - DIRECTORS ......................................................  9
PART 11 - INDEMNIFICATION ................................................ 12
PART 12 - PROCEEDINGS OF DIRECTORS ....................................... 14
PART 13 - OFFICERS ....................................................... 15
PART 14 - EXECUTION OF INSTRUMENTS ....................................... 17
PART 15 - DIVIDENDS ...................................................... 18
PART 16 - ACCOUNTS ....................................................... 19
PART 17 - NOTICES ........................................................ 19
PART 18 - FEES ........................................................... 20
PART 19 - TRANSFER OF SHARES, RESTRICTIONS ............................... 20
PART 20 - SPECIAL RIGHTS AND RESTRICTIONS ................................ 21





                            PART 1 - INTERPRETATION

1.1   In these Articles, unless the context otherwise requres:

      (a)  "directors" means the director or directors of the Company for the
           time being;

      (b)  "Company Act" means the Company Act of the Province of British
           Columbia from time to time in force and all amendments thereto and
           all Regulations and amendments thereto made pursuant to that Act;

      (c)  "register" means the register of members to be kept pursuant to
           the Company Act;

      (d)  "registered address" of a member means his address as recorded in
           the register;

      (e)  "registered address" of a director means his address as recorded
           in the Company's register of directors to be kept at the records
           office of the Company pursuant to the Company Act.

1.2   Words importing the singular include the plural and vice versa, and
      words importing a male person include a female person and a corporation.

1.3   The definitions in the Company Act in force and as amended from time to
      time shall, with necessary changes and so far as applicable,
      apply to these Articles.

1.4   The regulations contained in Table A in the First Schedule to the
      Company Act shall not apply to the Company.


                           PART 2 - ISSUE OF SHARES

2.1   Subject to the Company Act and to these Articles, the issue of shares
      of the Company shall be under the control of the directors who may,
      subject to the rights of holders of shares of the Company for the time
      being outstanding, allot or otherwise dispose of, and/or grant options
      on, shares authorized but not yet issued at such times and to such
      persons, including directors, and in such manner and upon such terms
      and conditions and at such price or for such consideration as the
      directors in their absolute discretion may determine.

2.2   Whenever the Company is not a reporting company, the directors, before
      allotting any shares, shall first offer those shares pro rata to the
      members, but where there are classes of shares, the directors shall
      first offer the shares to be allotted pro rata to the members holding
      shares of the class proposed to be allotted, and, if any shares remain,
      the directors shall then offer the remaining shares pro rata to the
      other members. The offer shall be made by notice specifying the number
      of shares offered and the time, which shall be not less than seven
      days, for acceptance of the offer. After the expiration of the time for
      acceptance or on receipt of written confirmation from the person to
      whom such an offer is made that he declines to accept the offer, and
      where there are no other members holding shares who should first
      receive an offer, the directors may, for three months thereafter,
      offer shares to





                                    - 2 -


      such persons and in such manner as they think most beneficial to the
      Company, but the offer to those persons shall not be at a price less
      than, or on terms more favourable than, the offer to the members.
      Whenever the Company is a reporting company, the directors may allot and
      issue its shares at such times and in such manner and to such persons or
      class of persons as the directors may determine and as the Company Act,
      the Securities Act, and all other applicable laws permit.

2.3   When the Company is authorized to issue shares without par value, the
      directors are authorized to determine the price or consideration for
      which such shares shall be allotted or issued, and notwithstanding that
      the price or consideration for a share may be other than cash, the
      price or consideration for a share shall, at the time when the share is
      allotted, be expressed in terms of money and so recorded in the
      proceedings of the directors of the Company.

2.4   No share shall be issued until the Company has received the full
      consideration therefore in cash, property, or services, provided that:

      (a)   a document or book account evidencing indebtedness of the
            allottee does not constitute property;

      (b)   services shall be past services actually performed for the
            Company; and

      (c)   the value of property or services shall be the value the
            directors determine by resolution to be, in all the circumstances
            of the transaction, the fair market value.

2.5   Subject to the provisions and restrictions contained in the Company Act
      applicable to the shares without par value or otherwise, the Company
      may pay a commission or allow a discount in an amount not exceeding 25%
      of the amount of the subscription price to any person in consideration
      of his subscribing or agreeing to subscribe, or procuring or agreeing
      to procure subscriptions, whether absolutely or conditionally for
      shares. The Company may pay such brokerage as may be lawful.


                          PART 3 - SHARE CERTIFICATES

3.1   Every share certificate issued by the Company shall be in such form as
      the directors approve and shall comply with the requirements of the
      Company Act.

3.2   If any share certificate is worn out or defaced, then upon production
      of that certificate to the directors or the transfer agent of the
      Company, the directors or that transfer agent may declare the same to
      be cancelled and cause it to be so marked and may issue a new
      certificate in place of the certificate cancelled. If any share
      certificate is lost or destroyed, then, upon proof of the loss or
      destruction to the satisfaction of the directors, and upon giving such
      indemnity as the directors deem adequate, a new certificate shall be
      issued to the party entitled to it. In any such case where a new share
      certificate is issued, the fee prescribed in Part 18 of these Articles
      must be paid if requested.

3.3   A share certicate registered in the names of two or more persons shall
      be delivered to the person first named on the register.





                                    - 3 -


                     PART 4 - TRANSFER OF SHARES, GENERAL

4.1   Subject to the restrictions, if any, set forth in these Articles, any
      member may transfer his shares by instrument in writing executed by or
      on behalf of such member and delivered to the Company or its transfer
      agent. The instrument of transfer of any share of the Company shall be
      in the form, if any, on the back of the certificate of the share being
      transferred, or in any other form which the directors may approve. If
      the directors so require, each instrument of transfer shall be in
      respect of only one class of shares.

4.2   Every instrument of transfer shall be executed by the transferor and left
      at the registered office of the Company or at an authorized office of
      its transfer agent for registration, together with the certificate for
      the shares to be transferred and such other evidence, if any, as the
      directors or the transfer agent may require to prove the title of the
      transferor or his right to transfer the shares. All instruments of
      transfer which are registered shall be retained by the Company or its
      transfer agent, but any instrument of transfer where the transfer is
      not registered shall be returned to the person depositing the same,
      together with the share certificate which accompanied the same when
      tendered for registration. The transferor shall remain the holder of
      the share until the name of the transferee is entered on the register
      in respect of that share.

4.3   The signature of the registered owner of any shares, or of his duly
      authorized attorney, upon the form of transfer consitutes an authority
      to the Company to register the shares specified in the form of
      transfer in the name of the person named in that form as transferee or,
      if no person is so named, then in any name designated in writing by the
      person depositing the share certificate and the form of transfer with
      the Company or its agents. The Company or its transfer agent may
      require proof or guarantee of the signature of any transferor.

4.4   Neither the Company nor any director, officer or agent is bound to
      enquire into the title of the transferee of shares to be transferred,
      nor is any such person liable to the registered or any intermediate
      owner of the shares for registering the transfer.

4.5   The Company may keep its register of members either at its records
      office or at any office in the Province of British Columbia of a trust
      company registered under the Trust Company Act, and may keep, or cause
      to be kept within the Province by a trust company registered as
      aforesaid, one or more branch registers of members.

4.6   Whenever the Company is a reporting company, but not otherwise, it may
      cause one or more branch registers of members to be kept outside the
      Province of British Columbia.

                       PART 5 - TRANSMISSION OF SHARES

5.1   In the case of the death or bankruptcy of a member, his personal
      representative or trustee in bankruptcy shall be the only person
      recognized by the Company as having any title to or interest in the
      shares registered in the name of the deceased. Before recognizing any
      personal representative or trustee in bankruptcy the directors may
      require him to produce and deposit the documents required by the
      Company Act.




                                      - 4 -


      Notwithstanding anything otherwise provided in these Articles, if a
      person becomes entitled to a share as a result of an order of a Court
      of competent jurisdiction or pursuant to a statute, then, upon
      producing such evidence as the directors think sufficient that he is so
      entitled, such person may be registered as holder of the share.

                        PART 6 - BORROWING AND CAPITAL
                        ------------------------------

6.1   Subject to any restriction which may from time to time be included in
      the memorandum of the Company or these Articles or contained in the
      Company Act or the terms, rights or restrictions of any shares or
      securities of the Company outstanding, the directors may at their
      discretion authorize the Company to borrow any sum of money and may
      raise or secure the repayment of such sum in such manner and upon such
      terms and conditions, in all respects, as they think fit, and in
      particular, and without limiting the generality of the foregoing, by
      the issue of bonds or debentures, or any mortgage or charge, whether
      specific or floating, or by granting any other security on the
      undertaking, or the whole or any part of the property, of the Company,
      both present and future.

6.2   The directors may make any debentures, bonds or other debt obligations
      by the Company, by their terms assignable free from any equities
      between the Company and the person to whom they may be issued or any
      other person who lawfully acquires the same by assignment, purchase, or
      otherwise, howsoever.

6.3   The directors may authorize the issue of any debentures, bonds or other
      debt obligations of the Company at a discount, premium or otherwise,
      and with special or other rights or privileges as to redemption,
      surrender, entitlement to interest or share of income, allotment of, or
      conversion into, or exchange for shares, attendance at general meetings
      of the Company, and otherwise as the directors may determine at or
      before the time of issue, but no debenture shall be issued which the
      Company has not the power to reissue until the members by resolution
      determine such debenture shall be cancelled unless such debenture
      expressly provides by its terms that it shall not be reissued. The
      Company may cause one or more branch registers of its debenture holders
      to be kept.

6.4   The Company by ordinary resolution of the members and insofar as the
      Company Act shall permit, may alter its memorandum to increase its
      authorized capital by:

      (a)   creating shares with par value, or shares without par value, or
            both;

      (b)   increasing the number of shares with par value, or shares without
            par value, or both;

      (c)   increasing the par value of a class of shares with par value, if
            no shares of that class are issued; or

      (d)   creating shares of different classes with special rights or
            restrictions.

6.5   The Company may, by resolution of the directors and subject to the
      provisions of the Company Act and the specific provisions of any
      special rights or restrictions attached to any class or classes of its
      shares, purchase or otherwise acquire any of its shares





                                      - 5 -


      if, at the time of the proposed purchase or acquisition the Company is
      not insolvent or likely to be rendered insolvent by such purchase or
      acquisition and if, where a proposed purchase of shares is not to be
      made through a stock exchange, the Company shall make its offer to
      purchase pro rata to every member who holds shares of the class or kind
      to be purchased unless the Company is purchasing shares from a
      dissenting member pursuant to the Company Act.

6.6   The Company may, by resolution of the directors and subject to the
      provisions of the Company Act and the specific provisions of any
      special rights or restrictions attached to any class or classes of its
      shares by the Memorandum or these Articles, redeem any of its issued
      shares that have a right of redemption attached thereto provided that
      at the time of such redemption the Company is not insolvent or likely
      to be rendered insolvent by such redemption and where the Company
      proposes to redeem some, but not all, of its shares of a particular
      class or kind, the directors shall have absolute discretion to
      determine in such manner as they deem proper which shares shall be
      redeemed, and, without limiting the generality of the foregoing, may
      redeem shares which have been purchased by the Company in priority to
      shares which are held by members.


                             PART 7 - MEETINGS
                             -----------------

7.1   Meetings of the Company shall be held at such time and place, in
      accordance with the Company Act, as the directors appoint, and, unless
      otherwise specifically provided, the provisions of these Articles
      relating to meetings shall apply with necessary changes to a meeting of
      members holding a particular class of shares. Notwithstanding the
      foregoing, a meeting of members may only be held outside Canada if all
      members entitled to vote at that meeting so agree, and a shareholder
      who attends a meeting of members held outside Canada is deemed to have
      so agreed except when he attends the meeting for the express purpose of
      objecting to the transaction of any business on the grounds that the
      meeting is not lawfully held.

7.2   Every meeting, other than an annual general meeting or a class meeting,
      shall be called an extraordinary general meeting.

7.3   The directors may, whenever they think fit, convene an extraordinary
      general meeting.

7.4   Notice of a meeting shall specify the place, the day and the hour of
      meeting, and, in case of special business, the general nature of that
      business. Notice shall be given no less than 21 days or more than 50
      days before the meeting. The accidental omission to give notice of any
      meeting to, or the non-receipt of any notice by, any of the members
      entitled to receive notice, shall not invalidate any proceedings at
      that meeting.

7.5   If any special business includes presenting, considering, approving,
      ratifying or authorizing the execution of any document, then the
      portion of any notice relating to that document is sufficient if it
      states that a copy of the document or proposed document is or will be
      available for inspection by members at an office of the Company in the
      Province of British Columbia or at one or more designated places in





                                      - 6 -


      the Province during business hours on any specified or unspecified
      business day or days prior to the date of the meeting, and at the
      meeting.


                   PART 8 - PROCEEDINGS AT GENERAL MEETINGS
                   ----------------------------------------

8.1   The following business at a general meeting shall be deemed to be
      special business:

      (a)   All business at an extraordinary general meeting;

      (b)   All business that is transacted at an annual general meeting,
            with the exception of the consideration of the financial
            statements and the report of the directors and auditors, the
            election of directors, the appointment of the auditors and such
            other business as, under these Articles or in accordance with the
            Company Act, ought to be transacted at an annual general meeting
            or is business which is brought under consideration by the report
            of the directors issued with the notice convening the meeting;

      and no special business shall be conducted at any meeting unless notice
      of that business has been given to the members in accordance with these
      Articles or members holding at least 75% of the shares entitled to be
      voted at that meeting are present and consent to the conduct of such
      business.

8.2   No business, other than the election of a chairman and the adjournment
      or termination of the meeting, shall be conducted at any meeting at any
      time when a quorum is not present. A quorum shall be one person holding
      or representing by proxy not less than one-half of the outstanding
      shares of the Company which are entitled to be voted at the meeting,
      unless the Company has only one member, in which case the quorum shall
      be that member who may conduct the business of the Company by
      proceedings recorded in writing and signed by him. If at any time
      during a meeting there ceases to be a quorum present, any business then
      in progress shall be suspended until there is a quorum present or until
      the meeting is adjourned or terminated, as the case may be.

8.3   If within 30 minutes from the time appointed for a meeting a quorum is
      not present, the meeting, if convened upon the requisition of members,
      shall be terminated. In any other case, it shall stand adjourned to the
      same day in the next week, at the same time and place, and if, at the
      adjourned meeting, a quorum is not present within half an hour from the
      time appointed for the meeting, the member or members present shall be
      a quorum.

8.4   Subject to Article 8.5, the chairman of the board of directors, if
      there is one, failing whom the president of the Company, failing whom
      one of the directors present chosen by the directors from among their
      number, shall preside as chairman of every meeting.

8.5   If at any general meeting there is no chairman or president or director
      present within 15 minutes after the time appointed for holding the
      meeting, or if the chairman or president and all the directors present
      are unwilling to act as chairman, the members present shall choose
      someone of their number to be chairman.




                                    - 7 -

8.6  The chairman of a meeting may, with the consent of any meeting at which
     a quorum is present, and shall, if so directed by the meeting, adjourn
     the meeting from time to time and from place to place, but no business
     shall be transacted at any adjourned meeting other than the business
     left unfinished at the meeting from which the adjournment took place.
     When a meeting is adjourned for 30 days or more, notice of the adjourned
     meeting shall be given as in the case of the original meeting. Except as
     aforesaid, it is not necessary to give any notice of an adjournment or
     of the business to be transacted at an adjourned meeting.

8.7  No resolution proposed at a meeting need be seconded, and the chairman
     of any meeting is entitled to move or propose a resolution.

8.8  In case of an equality of votes the chairman shall not, either on a show
     of hands or on a poll, have a casting or second vote in addition to the
     vote or votes to which he may be entitled as a member, which vote or
     votes he is entitled to cast without vacating the chair.

8.9  In the case of any dispute as to the admission or rejection of a proxy
     or a vote, the chairman shall determine the same and his determination,
     made in good faith, is final and conclusive.

8.10 A member entitled to more than one vote need not, if he votes, use all
     his votes or cast all the votes he uses in the same way.

8.11 Subject to these Articles, if a poll is duly demanded it shall be taken
     in such manner as the chairman directs within seven days of the demand
     for the same. The result of the poll shall be deemed to be the
     resolution of the meeting at which the poll is demanded. A demand for a
     poll may be withdrawn at any time before it has been taken.

8.12 A poll demanded on a question of adjournment shall be taken at the
     meeting without adjournment.

8.13 The demand for a poll shall not, unless the chairman so rules, prevent
     the continuance of a meeting for the transaction of any business other
     than the question on which a poll has been demanded or questions which
     depend on bear upon that question.

8.14 Subject always to any contrary or specific provision of the Company Act,
     a resolution that has been submitted to all of the members who would
     have been entitled to vote thereon in person or by proxy at a meeting
     and that has been consented to in writing by such members holding not
     less than 75% of the shares of the Company shall be deemed to be an
     ordinary resolution passed at a meeting.

8.15 Subject always to any contrary or specific provision of the Company Act,
     a resolution consented to in writing by every member of the Company who
     would have been entitled to vote thereon in person or by proxy at a
     meeting shall be deemed to be a special resolution passed at a meeting.

8.16 Subject always to the provisions of the Company Act, whenever the
     Company is not a reporting company, where all the members entitled to
     attend and vote at the annual general meeting of the Company consent in
     writing to all the business




                                  - 8 -


     required to be transacted at the meeting, it is not necessary for the
     Company to hold that annual general meeting.


                           PART 9 - VOTES OF MEMBERS
                           -------------------------

9.1  Subject to any rights or restrictions for the time being attached to any
     class or classes of shares, on a show of hands every member present in
     person or by proxy has one vote, and on a poll every such member present
     in person or by proxy has one vote for each share he holds on the record
     date except that no member which is a corporation which is a subsidiary
     of the Company shall be entitled to vote its shares of the Company, and
     the Company itself shall not vote in respect of any share of the Company
     that it has redeemed purchased, or otherwise acquired.

9.2  Any person who is not registered as a member but who is entitled to vote
     at any meeting in respect of a share, may vote the share in the same
     manner as if he were a member, but, unless the directors have previously
     admitted his right to vote at that meeting in respect of the share, if
     so required by any director he shall satisfy the directors of his right
     to vote the share before the time for holding the meeting, or adjourned
     meeting, as the case may be, at which he proposes to vote.

9.3  Where there are joint members registered in respect of any share, any
     one of the joint members may vote at any meeting, either personally or
     by proxy, in respect of the share as if he were solely entitled to it.
     If more than one of the joint members is present at any meeting,
     personally or by proxy, the joint member present whose name stands first
     on the register in respect of the share shall alone be entitled to vote
     in respect of that share. Several executors or administrators of a
     deceased member in whose sole name any share stands shall, for the
     purposes of this Article, be deemed joint members.

9.4  Subject to the provisions of the Company Act, a corporation which is a
     member and is not a subsidiary of the Company may vote by up to two duly
     authorized representatives, who are entitled to speak and vote, either
     in person or by proxy, and in all other respects exercise the rights of
     a member and those representatives shall be reckoned as a member for all
     purposes in connection with any meeting of the Company.

9.5  A member for whom a committee has been duly appointed may vote, whether
     on a show of hands or on a poll, by his committee and that committee may
     appoint a proxyholder.

9.6  Unless the directors otherwise determine, the instrument appointing a
     proxyholder and the power of attorney or other authority, if any, under
     which it is signed, or a notarially certified copy thereof, shall be
     deposited at a place specified for that purpose in the notice convening
     the meeting, not less than 48 hours before the time for holding the
     meeting at which the proxyholder proposes to vote, or, if no such place
     is specified, then it shall be deposited with the chairman of the
     meeting prior to the commencement of the meeting.

9.7  A vote given in accordance with the terms of an instrument of proxy is
     valid notwithstanding the previous death or incapability of the member,
     or revocation of





                                       - 9 -


     the proxy, or of the authority under which the proxy was executed, or
     the transfer of the share in respect of which the proxy is given, if,
     but only if, no prior notice in writing of the death, incapability,
     revocation or transfer has been received at the registered office of the
     Company or by the chairmen of the meeting or adjourned meeting before
     the vote is given.

9.8  An instrument appointing a proxyholder, whether for a specified meeting
     or otherwise, shall be, subject to the requirements of the Company Act,
     in the form approved by the directors.

9.9  A proxy or an instrument appointing a duly authorized representative of
     a corporation shall be in writing, under the hand of the appointor or of
     his attorney duly authorized in writing, or, if such appointor is a
     corporation, either under its seal or under the hand of an officer or
     attorney duly authorized.

9.10 Any person may act as a proxyholder whether or not he is entitled on his
     own behalf to be present and to vote at the meeting at which he acts as
     proxyholder.

9.11 The directors may, by resolution, fix in advance a date and time as the
     record for the determination of the members entitled to receive notice
     of a meeting of the members, but such record date shall not precede by
     more than 50 days or by less than 21 days the date on which the meeting
     is to be held. If the directors fail to fix in advance a date and time
     as the record date in respect of all or any of the matters described
     above for any meeting of the members of the Company, the following
     provisions shall apply, as the case may be:

     (a)  the record date for the determination of the members entitled to
          receive notice of a meeting of members shall be a the close of
          business on the day immediately preceding the day on which notice
          is given or sent;

     (b)  the record date for the determine of the members entitled to
          receive the financial statements of the Company shall be the close
          of business on the day on which the directors pass the resolution
          relating thereto.


                              PART 10 - DIRECTORS
                              -------------------

10.1 The directors named in the Instrument of Continuation at the coming into
     force of these Articles, shall be the directors of the Company unless
     and until such person:

     (a)  dies;

     (b)  resigns in writing;

     (c)  is no longer qualified in accordance with these Articles or the
          Company Act; or

     (d)  is removed from office by ordinary resolution of the members.

10.2 The management of the business of the Company shall be vested in the
     directors and the directors may exercise all such powers and do all such
     acts and things as the Company may exercise and do which are not by
     these Articles or by the Company Act or otherwise lawfully directed or
     required to be exercised or done by




                                      - 10 -

     the Company in general meeting, but subject, nevertheless, to the
     provisions of all laws affecting the Company and of these Articles and
     to any rules, not being inconsistent with these Articles which are made
     from time to time by the Company in general meeting, provided that no
     rule made by the Company in general meeting shall invalidate any prior
     act of the directors that would have been valid if that rule had not
     been made.

10.3 The number of directors shall be at least one as long as the Company is
     not a reporting company, and shall be at least three whenever the Company
     is a reporting company, and no more than 25. Subject to the foregoing,
     the number of directors may be determined from time to time by
     resolution of the members, and provided that the number of directors
     holding office shall not fall below the minimum numbers above mentioned,
     the number of directors shall be automatically reduced upon the death,
     resignation, removal or disqualification of any director and
     automatically increased upon the appointment of any additional director
     or directors in accordance with these Articles.

10.4 A director is not required to hold a share of the Company as
     qualification to be a director, but in order to be qualified he must not
     be:

     (a)  under the age of 18 years; or,

     (b)  found to be incapable of managing his own affairs by reason of
          mental infirmity; or,

     (c)  a corporation; or,

     (d)  an undischarged bankrupt; or,

     (e)  unless the Supreme Court of British Columbia orders otherwise,
          convicted within or without the Province of British Columbia of an
          offence

          (i)   in connection with the promotion, formation, or management of
                a corporation; or,

          (ii)  involving fraud,

          unless five years have elapsed since the expiration of the period
          fixed for suspension of the passing of sentence without sentencing,
          or since a fine was imposed, or the term of imprisonment and
          probation imposed, if any, was concluded, whichever is the latest,
          but the disability imposed by the clause ceases upon a pardon being
          granted under the Criminal Records Act (Canada);

     and every director must not be subject to any other disqualifications as
     to office according to the Company Act, provided always that no person
     who is not ordinarily resident in Canada shall be appointed a director
     of the Company if, upon his appointment, the majority of the directors
     of the Company would not be persons ordinarily resident in Canada.

10.5 In the event of the death, resignation, removal or disqualification of a
     director and his consequent vacating of office in accordance with these
     Articles or the Company Act




                                      - 11 -



      in circumstances in which the majority of the directors of the Company
      would thereafter not be persons ordinarily resident in Canada, then the
      last appointed director who is not ordinarily resident in Canada shall,
      ipso facto, be disqualified from office and be no longer a director of
      the Company. In the event there are on the happening of such an event
      two or more persons who are not ordinarily resident in Canada who were
      last appointed and appointed at the same time, then the Secretary shall
      determine by lot which of the two or more so last appointed shall have
      ceased to hold office by reason of this paragraph. Subject to the
      foregoing, if a casual vacancy should occur in the board, the remaining
      directors if constituting a quorum may appoint a qualified person to
      fill the vacancy for the remainder of the term. Where a vacancy or
      vacancies exist on the board, the remaining directors may exercise all
      of the powers of the board so long as a quorum remains in office.

10.6  If the Company removes any director by ordinary resolution, it may by
      ordinary resolution, appoint another person in his stead.

10.7  Any person not being a member of the Company who becomes a director
      shall be deemed to have agreed to be bound by the provisions of the
      Articles to the same extent as if he were a member of the Company.

10.8  Subject to the provisions of any ordinary resolution, the remuneration
      of the directors as such may from time to time be determined by the
      directors themselves, and such remuneration may be in addition to any
      salary or other remuneration paid to any officer or employee of the
      Company as such, who is also a director. The directors shall be repaid
      such reasonable expenses as they may incur in and about the business of
      the Company, and if any director shall perform any professional or other
      services for the Company that are outside the ordinary duties of a
      director, or shall otherwise be specifically occupied in or about the
      Company's business, he may be paid a special remuneration to be fixed by
      the directors in addition to any other remuneration that he may be
      entitled to receive and the same shall be charged as part of the
      ordinary working expenses. Unless otherwise determined by ordinary
      resolution, the director on behalf of the Company may pay a gratuity or
      pension or allowance on retirement to any person who has held any office
      of employment with the Company or to his spouse or dependants and may
      make contributions under any plan or to any fund and pay premiums for
      the purchase or provision of any such gratuity, benefit, pension or
      allowance.

10.9  The directors may from time to time and at any time by power of attorney
      appoint any company, firm or person or body of persons to be the
      attorney or attorneys of the Company for such purposes and with such
      powers, authorities and discretion, not exceeding those vested in or
      exercisable by the directors under these Articles, and for such period,
      and subject to such conditions, as they may think fit.

10.10 A director who is in any way directly or indirectly interested in a
      proposed contract or transaction with the Company shall disclose the
      nature and extent of his interest at a meeting of the directors in
      accordance with the provisions of the Company Act. A director shall not
      vote in respect of any contract or transaction with the Company in which
      he is interested, and if he shall do so his vote shall not be counted,
      but he may be counted in the quorum present at the meeting at which such
      vote is taken.






                                   - 12 -

10.11 A director may hold any office or place of profit under the Company
      other than auditor, for such period, and on such terms as to
      remuneration or otherwise, as the directors may determine. Subject to
      compliance with the Company Act, no director shall be disqualified by
      his office from contracting with the Company either with regard to his
      tenure of any office or place of profit or as vendor, purchaser or
      otherwise.

10.12 Any director may act by himself or his firm in any professional
      capacity for the Company except as auditor, and he or his firm shall be
      entitled to remuneration for professional services as if he were not a
      director.

10.13 At each annual general meeting of the Company all the directors shall
      retire from office, but are eligible for re-election and the members
      shall by ordinary resolution elect a board of directors consisting of
      the number of directors so retiring or determined by resolution or
      recommendation of the directors. If in any calendar year the Company
      does not hold an annual general meeting the directors then in office
      shall be deemed to have been elected as directors on the last day on
      which the meeting should have been held pursuant to the Company Act,
      and the directors so elected may hold office until other directors are
      appointed or elected or until the day on which the next annual general
      meeting is held.


                         PART 11 - INDEMNIFICATION
                         -------------------------

11.1  The Company shall indemnify any director, officer, employee or agent of
      the Company who was or is a party or is threatened to be made a party
      to any threatened, pending or completed action or proceeding and
      whether civil, criminal or administrative, by reason of the fact that
      he is or was a director, officer, employee, or agent of the Company or
      any act or thing occurring at a time when he is or was serving at the
      request of the Company as a director, officer, employee or agent of
      another corporation, partnership, joint venture, trust or other
      enterprise, against all costs, charges and expenses, including legal
      fees and any amount paid to settle the action or proceeding or satisfy
      a judgment, if he acted honestly and in good faith with a view to the
      best interests of the corporation or other legal entity or enterprise
      as aforesaid of which he is or was a director, officer, employee or
      agent, as the case may be, and exercised the care, diligence and skill
      of a reasonably prudent person, and with respect to any criminal or
      administrative action or proceeding, he had reasonable ground for
      believing that his conduct was lawful; provided that no indemnification
      of a director or former director of the Company, or director or former
      director of a corporation in which the Company is or was a shareholder,
      shall be made except to the extent approved by the Court pursuant to
      the Company Act or any other statute. The determination of any action,
      suit or proceeding by judgment, order, settlement, conviction or
      otherwise shall not, of itself, create a presumption that the person
      did not act honestly and in good faith and in the best interests of the
      Company and did not exercise the care, diligence and skill of a
      reasonably prudent person and, with respect to any criminal action or
      proceeding, did not have reasonable grounds to believe that his conduct
      was lawful.

11.2  The Company shall indemnify any person in respect of any loss, damage,
      costs or expenses whatsoever incurred by him while acting as an
      officer, employee or agent





                                   - 13 -


      for the Company unless such loss, damage, costs or expenses shall arise
      out of failure to comply with instructions, wilful act or default or
      fraud by such person, in any of which events the Company shall only
      indemnify such person if the directors, in their absolute discretion,
      so decide or the Company by ordinary resolution shall so direct.

11.3  The indemnification provided by this Article shall not be deemed
      exclusive of any other rights to which those seeking indemnification
      may be entitled under any other Article, or any valid and lawful
      agreement, vote of members or disinterested directors or otherwise,
      both as to action in his official capacity and as to action in another
      capacity while holding such office, and shall continue as to a person
      who has ceased to be a director, officer, employee or agent and shall
      entire to the benefit of the heirs, executors and administrators of
      such person. The indemnification provided by this Article shall not be
      exclusive of any powers, rights, agreements or undertakings which may
      be legally permissible or authorized by or under any applicable law.
      Notwithstanding any other provisions set forth in this Article, the
      indemnification authorized by this Article shall be applicable only to
      the extent that any such indemnification shall not duplicate indemnity
      or reimbursement which that person has received or shall receive
      otherwise than under this Part.

11.4  The directors are authorized from time to time to cause the Company to
      give indemnities to any director, officer, employee, agent or other
      person who has undertaken or is about to undertake any liability on
      behalf of the Company or any corporation controlled by it.

11.5  Subject to the Company Act, no director or officer or employee for the
      time being of the Company shall be liable for the acts, receipts,
      neglects or defaults of any other director or officer or employee, or
      for joining in any receipt or act for conformity, or for any loss,
      damage or expense happening to the Company through the insufficiency or
      deficiency of title to any property acquired by order of the Board for
      the Company, or for the insufficiency or deficiency of any security in
      or upon which any of the moneys of or belonging to the Company shall be
      invested or for any loss or damages arising from the bankruptcy,
      insolvency, or tortious act of any person, firm or corporation with
      whom or which any moneys, securities or effects shall be lodged or
      deposited or for any loss occasioned by any error of judgment or
      oversight on his part or for any other loss, damage or misfortune
      whatever which may happen in the execution of the duties of his
      respective office or trust or in relation thereto unless the same shall
      happen by or through his own wilful act or default, negligence, breach
      of trust or breach of duty.

11.6  Directors may rely upon the accuracy of any statement of fact
      represented by an officer of the Company to be correct or upon
      statements in a written report of the auditor of the Company and shall
      not be responsible or held liable for any loss or damage resulting from
      the paying of any dividends or otherwise acting in good faith upon any
      such statement.

11.7  The directors may cause the Company to purchase and maintain insurance
      for the benefit of any person who is or was a director, officer,
      employee or agent of the Company or is or was serving at the request of
      the Company as a director, officer, employee or agent of another
      corporation, partnership, joint venture, trust or other





                                   - 14 -


      enterprise against any liability incurred by him as a director,
      officer, employee or agent.


                      PART 12 - PROCEEDINGS OF DIRECTORS
                      ----------------------------------


12.1  Notice of the time and place of a directors meeting shall be given to
      each director no less than two days (exclusive of the day on which the
      notice is given) before the date of the meeting. For the first meeting
      of directors held immediately after election at a meeting of members,
      no notice of such meeting need be given, provided a quorum of directors
      is present. Notice for the time and place of special meetings of
      directors shall be delivered or faxed to each director not less than
      four hours before that special meeting.

12.2  The directors, when there is more than one, may meet together at such
      places as they think fit for the dispatch of business, and may adjourn
      and otherwise regulate their meetings and proceedings as they see fit.

12.3  The quorum shall be a majority of the directors then in office, and when
      an even number of directors are holding office, shall be one more than
      half of their number.

12.4  Unless and until the directors shall elect one of their number to be
      chairman of the board of directors, the president of the Company shall
      be chairman of all meetings of the directors; but if at any meeting a
      chairman elected by the directors or the president is not present
      within 30 minutes after the time appointed for holding the meeting, the
      directors present may choose someone of their number to be chairman at
      that meeting.

12.5  Any director may waive notice of any meeting of directors. Accidental
      omission to give notice of a meeting of directors to, or non-receipt of
      notice by, any director, shall not invalidate the proceedings of any
      meeting of the directors.

12.6  Except as provided in the Company Act, the Directors may participate in
      a meeting of the Directors by means of telephone or other
      communications facilities that permit all Directors participating in
      the meeting to communicate with each other. A meeting so held in
      accordance with this Article shall be deemed to be an actual meeting of
      the board and any resolution passed at such meeting shall be as valid
      and effectual as if it had been passed at a meeting where the Directors
      are physically present. A Director participating in a meeting in
      accordance with this Article shall be deemed to be present at the
      meeting and to have so agreed and shall be counted in the quorum
      therefore and be entitled to participate in and vote thereat.

12.7  The directors, or any committee of directors, may take any action
      required or permitted to be taken by them and may exercise all or any
      of the authorities, powers and discretion for the time being vested in
      or exercisable by them by resolution either passed at the meeting at
      which a quorum is present or authorized by resolution consented to in
      writing signed by all the directors in accordance with the Company Act.

12.8  The directors may delegate any, but not all, of their powers to
      committees consisting of such director or directors as they think fit.
      A majority of the members of any such





                                   - 15 -


      committee must be resident Canadians. Any committee so formed in the
      exercise of the powers so delegated shall conform to any rules that may
      from time to time be imposed on it by the directors, and shall report
      every act or thing done in exercise of those powers to the first
      meeting of the directors held after it has been done.

12.9  A committee of more than one director may elect a chairman of its
      meetings and if no chairman is elected, or if at any meeting the
      chairman is not present within 30 minutes after the time appointed for
      holding the meeting, the directors present who are members of the
      committee may choose one of their number to be chairman of the meeting.

12.10 The member or members of a committee may govern their procedure as they
      think proper, subject to any rules imposed by the directors. Questions
      arising shall be determined by the member, if there be only one, or by
      a majority of votes of the members present, but in case of an equality
      of votes the chairman of a committee shall not have a second or casting
      vote.

12.11 Any director of the Company who may be absent from the Province of
      British Columbia may file at the registered office of the Company by
      letter or facsimile a waiver of notice of any meeting of the directors
      and may, at any time and by one of the means mentioned aforesaid,
      withdraw the waiver, but until the waiver is withdrawn, no notice of
      meetings of directors need be sent to that director, and any and all
      meetings of the directors of the Company held after receipt of such
      waiver and held prior to its withdrawal shall, provided a quorum of the
      directors is present, be valid and effective without notice of such
      meeting given to that director.

12.12 Questions arising at any meeting of the directors shall be decided by a
      majority of votes. In case of an equality of votes, the chairman shall
      not have a second or casting vote.

12.13 No resolution proposed at a meeting of directors need be seconded, and
      the chairman of any meeting is entitled to move or propose and vote
      upon a resolution of the directors.

12.14 All acts done by any meeting of the directors or by a committee of
      directors or by any person acting as a director shall, notwithstanding
      that it shall be afterwards discovered that there was some defect in
      the appointment of any such director or person acting as aforesaid, or
      that they or any of them were disqualified be as valid as if every such
      person had been duly appointed and was qualified to be a director.


                                PART 13 - OFFICERS
                                ------------------

13.1  The Company shall have a president and a secretary whom the directors
      shall appoint. The President must be a director of the Company. Except
      when the Company has only one member, the President and Secretary
      shall be different persons. Subject to the foregoing, the board may
      from time to time appoint such other officers as the board may
      determine.

13.2  All appointments of officers shall be made at such remuneration,
      whether by way of salary, fee, commission, participation in profits, or
      otherwise, as the directors think





                                   - 16 -


      fit, and every appointment of an officer by the directors shall be in
      force until revoked by the directors or until the death or resignation
      in writing of the officer unless otherwise provided in the resolution of
      appointment.

13.3  Every officer of the Company who holds any office or possesses any
      property whereby, whether directly or indirectly, duties or interests
      might be created in conflict with his duties or interests as an officer
      of the Company shall, in writing, disclose to the President the fact
      and the nature, character and extent of the conflict.

13.4  The chairman of the board of directors, if any, shall, if present,
      preside at all meetings of the board of directors and of members. He
      shall sign such contracts, documents or instruments in writing as
      require his signature and shall have such other powers and duties as
      may from time to time be assigned to him by resolution of the directors.

13.5  The president, who may also be the chief executive officer of the
      Company, shall exercise general supervision over the business and
      affairs of the Company. In the absence or inability of the chairman of
      the board of directors, the president shall, when present, preside at
      all meetings of the board of directors and members; he shall sign such
      contracts, documents or instruments in writing as require his signature
      and shall have such other powers and shall perform such other duties as
      may from time to time be assigned to him by resolution of the board of
      directors or as are incident to his office.

13.6  The vice president, or, if more than one, the vice presidents, in order
      of seniority, shall be vested with all the powers and shall perform all
      the duties of the president in the absence or inability or refusal to
      act of the president, provided, however, that a vice president, who is
      not a director, shall not preside as chairman at any meeting of
      members. The vice president or, if more than one, the vice presidents,
      in order of seniority, shall sign such contracts, documents or
      instruments in writing as require his or their signatures and shall
      also have such other powers and duties as may from time to time be
      assigned to him or them by resolution of the board of directors.

13.7  The secretary, if any, shall give or cause to be given notices for all
      meetings of the board of directors, or committees thereof, if any, and
      of members when directed to do so and shall have charge, subject to the
      Articles, of the corporate records and of the corporate seal or seals,
      if any. He shall sign such contracts, documents or instruments in
      writing as require his signature and shall have such other powers and
      duties as may from time to time be assigned to him by resolution of the
      board of directors or as are incident to his office.

13.8  Subject to the provisions of any resolution of the board of directors,
      the treasurer, if any, shall have the care and custody of all the funds
      and securities of the Company and shall deposit the same in the name of
      the Company in such bank or banks or with such other depositary or
      depositaries as the board of directors may, by resolution, direct. He
      shall prepare, maintain and keep or cause to be kept adequate books of
      accounts and accounting records. He shall sign such contracts,
      documents or instruments in writing as require his signature and shall
      have such other powers and duties as may from time to time be assigned
      to him by resolution of the board of directors or as are incident to
      his office. He may be required to give such bond for





                                   - 17 -


      the faithful performance of his duties as the board of directors, in
      their absolute discretion, may require, and no director shall be liable
      for failure to require any such bond or for the insufficiency of any
      such bond or for any loss by reason of the failure of the Company to
      receive any indemnity thereby provided.

13.9  The assistant secretary or, if more than one, the assistant
      secretaries, in order of seniority, and the assistant treasurer or, if
      more than one, the assistant treasurers, in order of seniority, shall
      respectivey perform all the duties of the secretary and treasurer,
      respectively, when required to do so. The assistant secretary or
      assistant secretaries, if more than one, and the assistant treasurer or
      assistant treasurers, if more than one, shall sign such contracts,
      documents or instruments in writing as require his or their signatures
      respectively and shall have such other powers and duties as may from
      time to time be assigned to them by resolution of the board of
      directors.

13.10 The board of directors may from time to time appoint from their number
      a managing director, who is a resident Canadian, and may, subject to
      the Company Act, delegate to him any of the powers of the board of
      directors. The managing director shall conform to all lawful orders
      given to him by the board of directors of the Company and shall, at all
      reasonable times, give to the directors, or any of them, all
      information they may require regarding the affairs of the Company. Any
      agent of employee appointed by the managing director shall be subject
      to discharge by the board of directors.


                       PART 14 - EXECUTION OF INSTRUMENTS
                       ----------------------------------

14.1  Contracts, documents or instruments in writing requiring the signature
      of the Company may be signed any director or any officer of the
      Company, or by any person authorized by resolution of the board of
      directors. All contracts, documents or instruments in writing so signed
      shall be binding upon the Company without any further authorization or
      formality. The board of directors is authorized from time to time, by
      resolution, to appoint any officer or officers or any other person or
      persons on behalf of the Company, either to sign contracts, documents
      or instruments in writing. Where the Company has only one director and
      officer being the same person, that person may sign all such contracts,
      documents or other written instruments.

14.2  The directors may, but shall not be required to, provide a common seal
      for the Company. They shall have power from time to time to destroy the
      same or substitute a new seal in place of the seal destroyed or to
      cause the affairs of the Company to be conducted without a common seal.
      In the event a seal is provided, then unless otherwise provided by the
      directors, the same may be affixed to any document by the signing
      officers designated in Article 14.1.

14.3  Subject to the provisions of the Company Act, the directors may provide
      for use in any other province, state, territory or country an official
      seal, which shall be a facsimile of the common seal of the Company,
      with the addition on its face of the name of the province, state,
      territory or country where it is to be used.




                                     - 18 -


14.4  The signature of any officer of the Company may be printed,
      lithographed, engraved or otherwise mechanically reproduced upon all
      instruments executed or issued by the Company or any officer thereof;
      and, subject to the Company Act, any instrument on which the signature
      of any such person is so reproduced, shall be deemed to have been
      manually signed by such person whose signature is so reproduced and
      shall be as valid to all intents and purposes as if such instrument had
      been signed manually, and notwithstanding that the person whose
      signature is so reproduced may have ceased to hold office at the date of
      the delivery or issue of such instrument. The term "instrument" as used
      in this Article shall include all paper and electronic writings.


                             PART 15 - DIVIDENDS
                             -------------------

15.1  The directors may declare dividends and fix the date of record
      therefore and the date for payment thereof.

15.2  Subject to the terms of shares with special rights or restrictions, all
      dividends shall be declared according to the number of shares held.

15.3  Dividends may only be payable out of the profits of the Company. No
      dividend shall bear interest against the Company. A transfer of a share
      shall not pass the right to any dividend thereon before the
      registration of the transfer in the register.

15.4  A resolution declaring a dividend may direct payment of the dividend
      wholly or partly by the distribution of specific assets or of paid-up
      shares, bonds, debentures or other debt obligations of the Company, or
      in any one or more of those ways, and, where any difficulty arises in
      regard to the distribution, the directors may settle the same as they
      think expedient, and in particular may fix the value for distribution
      of specific assets, and may determine that cash payments shall be made
      to a member upon the basis of the value so fixed in place of fractional
      shares, bonds, debentures or other debt obligations in order to adjust
      the rights of all parties, and may vest any of those specific assets in
      trustees upon such trusts for the persons entitled as may seem
      expedient to the directors.

15.5  Any dividend or other moneys payable in cash in respect of a share may
      be paid by cheque sent through the post to the member in a prepaid
      letter, envelope or wrapper addressed to the member at his registered
      address, or in the case of joint members, to the registered address of
      the joint member who is the first named on the register, or to such
      person and to such address as the member or joint members, as the case
      may be, in writing direct. Any one of two or more joint members may
      give effectual receipts for any dividend or other moneys payable or
      assets distributable in respect of a share held by them.

15.6  No notice of the declaration of a dividend need by given to any member.

15.7  The directors may, before declaring any dividend, set aside out of the
      profits of the Company such sums as they think proper as a reserve or
      reserves which shall, at the discretion of the directors, be applicable
      for meeting contingencies, or for equalizing dividends, or for any
      other purpose to which the profits of the Company may be properly
      applied, and pending that application may, at the like discretion,





                                     - 19 -


      either be employed in the business of the Company or be invested in
      such investments, as the directors may from time to time think fit,
      including shares of the Company purchased or acquired in accordance
      with these Articles.

15.8  The directors may capitalize any undistributed surplus on hand of the
      Company and may from time to time issue as fully paid and
      non-assessable any unissued shares or any bonds, debentures or other
      debt obligations of the Company as a dividend representing such
      undistributed surplus on hand or any part thereof.

15.9  Should any dividend result in any shareholder being entitled to a
      fractional share, the directors shall have the right to pay such
      shareholders the cash equivalent of such fractional part, and shall
      have the further right to carry out such distribution and to adjust the
      rights of the shareholders with respect thereto on as practical and
      equitable a basis as possible.


                             PART 16 - ACCOUNTS
                             ------------------


16.1  The directors shall cause records and books of accounts to be kept as
      necessary to record properly the financial affairs and conditions of
      the Company and to comply with the provisions of the Company Act and
      all statutes applicable to the Company.

16.2  The fiscal period of the Company shall terminate on such day in each
      year as the board of directors may from time to time, by resolution,
      determine.


                             PART 17 - NOTICES
                             -----------------

17.1  A notice may be given to any member or director, either by personal
      service or by sending it by post to him in a letter, envelope or
      wrapper, or by facsimile addressed to the member or director at his
      registered address or in any manner approved by the directors and not
      prohibited under the Company Act.

17.2  A notice may be given by the Company to joint members in respect of a
      share registered in their names by giving the notice to the joint
      member first named in the register of members in respect of that share.

17.3  A notice may be given by the Company to the persons entitled to a share
      in consequence of the death or bankruptcy of a member by sending it
      through the post in a prepaid letter, envelope or wrapper addressed to
      them by name, or by the title of representatives of the deceased or
      trustee of the bankrupt, or by any like description, at the address, if
      any, supplied for the purpose by the persons claiming to be so
      entitled, or, until that address has been so supplied, by giving the
      notice in any manner in which the same might have been given if the
      death or bankruptcy had not occurred.

17.4  Any notice or document sent by post to, or left at, the registered
      address of any member, shall, notwithstanding that member is then
      deceased, and whether or not the Company has notice of his death, be
      deemed to have been duly served in respect of any registered shares,
      whether held solely or jointly with other persons by that deceased
      member, until some other person is registered in his stead as the





                                     - 20 -


      member or joint member in respect of those shares, and that service
      shall for all purposes of these Articles be deemed a sufficient service
      of such notice or document on his personal representatives and all
      persons, if any, jointly interested with him in those shares.

17.5  Any notice sent by post shall be deemed to have been served on the
      second day following that on which the letter, envelope or wrapper
      containing the same is posted exclusive of any day upon which the mail
      is not regularly delivered or handled in either the place of posting or
      the place of delivery, and in proving service it is sufficient to prove
      that the letter, envelope or wrapper containing the notice was properly
      addressed and put in a Canadian government post office, postage
      prepaid, subject always to it being proved by the person to whom the
      notice was addressed that the mail was not regularly delivered or
      handled as aforesaid on or between the day of posting and the day of
      delivery.

17.6  Notice of every general meeting shall be given in the manner
      hereinbefore authorized to:

      (a)   every member holding a share or shares carrying the right to vote
            at such meetings on the record date or, if no record date was
            established by the directors, on the date of personal service or
            mailing;

      (b)   every person upon whom the ownership of a share has devolved by
            reason of his being a legal personal representative or a trustee
            in bankruptcy of a member where the member, but for his death or
            bankruptcy, would be entitled to receive notice of the meeting;
            and

      (c)   the auditor of the Company.

      Subject to any provisions in any instrument of the Company or in the
      special rights or restrictions attached to any shares, no other person
      is entitled to receive notice of general meetings.


                                PART 18 - FEES
                                --------------

18.1  The Company may charge the following fee to issue a new certificate in
      exchange for an existing certificate or a defaced or worn out
      certificate or to replace a lost or destroyed certificate:

      Per new certificate: $1.00


                  PART 19 - TRANSFER OF SHARES, RESTRICTIONS
                  ------------------------------------------

19.1  A share or shares in the Company may be transferred by an instrument of
      transfer and in accordance with these Articles by any member, or the
      personal representative of any deceased member or the trustee in
      bankruptcy of any bankrupt member or by the liquidator of any member
      which is a corporation, only with the approval of a resolution of the
      directors.





                                     - 21 -


19.2  Notwithstanding anything otherwise provided in these Articles, the
      directors may, in their absolute discretion, refuse to allow and
      decline to register any transfer of shares to any person, even if the
      foregoing conditions and other provisions of these Articles are
      complied with, and the directors shall not be bound or required to
      disclose their reasons for any such refusal to anyone.

19.3  The number of shareholders of the Company is limited to 50, excluding
      persons who are currently or were formerly employees of the Company.
      Where two or more persons jointly hold one (1) or more shares, such
      persons shall be considered as one and the same shareholder.

19.4  All public offerings or public invitations to subscribe for or purchase
      securities is prohibited.


                   PART 20 - SPECIAL RIGHTS AND RESTRICTIONS
                   -----------------------------------------


CLASS A COMMON SHARES
- ---------------------

20.1  The holders of the Class A Common Shares shall be entitled to one vote
      for each such share so held at all meetings of members.

20.2  Subject the rights of the holders of the Class B Preferred Shares and
      any Class C Preferred Shares established by series, the directors shall
      be at liberty in their absolute discretion to declare dividends on any
      one or more class or classes of the Class A Common Shares, the Class B
      Preferred Shares or the Class C Preferred Shares to the exclusion of the
      others.

20.3  Subject to the rights of holders of the Class B Preferred Shares and
      any Class C Preferred Shares established by series, in the event of the
      liquidation, dissolution or wind-up of the Company, whether voluntary
      or involuntary, the holders of the Class A Common Shares shall be
      entitled to participate on a pro rata basis in the distribution of the
      remaining assets of the Company.

CLASS B PREFERRED SHARES
- ------------------------

20.4  Subject to the rights of the Class C Preferred Shares, the holders of
      Class B Preferred Shares shall be entitled to receive a preferred
      non-cumulative dividend the rate of which shall be determined from time
      to time by the board of directors of the Company, such dividend to be
      payable at such time and in such manner as shall be determined by the
      board.

20.5  Subject to the rights of the Class C Preferred Shares, in the event of
      winding-up or liquidation or any other distribution of the assets of
      the Company, the Class B Preferred Shares shall rank prior to all other
      shares of the Company as to the payment of the paid-up share capital
      and any dividends attributable thereto. The Class B Preferred Shares
      shall not otherwise share in the profits and surplus assets of the
      Company.

20.6  Subject to the terms of the Company Act, the holders of Class B
      Preferred Shares shall not, as such, be entitled to receive notice of,
      or attend or vote at, any meeting of members of the Company.





                                     - 22 -


20.7  Subject to the Company Act, the Class B Preferred Shares shall be
      redeemable at the option of the Company, upon a 30-day notice in
      writing, at a price that shall include the amount paid plus any
      declared and unpaid dividends. Where only part of the shares are
      redeemed, such redemption shall be made on a pro rata basis of the
      shares held by all members, without taking fractional shares into
      consideration.

20.8  Subject to the Company Act, the Company shall have the right, where it
      deems appropriate to do so and without notice, to purchase by mutual
      agreement all or part of the then issued Class B Preferred Shares, at
      the best possible price. Where only part of the shares are purchased,
      such purchase shall be made on a pro rata basis as set forth hereabove
      or in any other manner as may be agreed upon unanimously by the holders
      of the outstanding Class B Preferred Shares.

20.9  On the date of purchase, the Class B Preferred Shares thus redeemed or
      purchased shall be cancelled.

CLASS C PREFERRED SHARES
- ------------------------

20.10 Class C Preferred Shares may be issued by the directors in one or more
      series, and the directors may, from time to time, by resolution passed:

      (a)   alter the Memorandum of the Company to fix the number of shares
            in, and to determine the designation of the shares of, each
            series; and

      (b)   alter the Memorandum or the Articles of the Company to create,
            define and attach special rights and restrictions to the shares
            of each series, subject to the special rights and restrictions
            attached to the shares of the Class, including without in any way
            limiting or restricting the generality of the foregoing, the
            following:

            (i)   the rate, amount or method of calculation of dividends, if
                  any, and whether the same are subject to adjustments;

            (ii)  whether such dividends are cumulative, partly cumulative or
                  non-cumulative;

            (iii) the dates, manner and currency of payments of dividends and
                  the dates from which dividends accrue or become payable;

            (iv)  if redeemable or purchasable, the redemption or purchase
                  prices and the terms and conditions of redemption or
                  purchase, with or without provision for sinking or similar
                  funds;

            (v)   any conversion, exchange or reclassification rights; and

            (vi)  any other rights, privileges, restrictions and conditions
                  not inconsistent with these provisions.

20.11 The Class A Preferred Shares of each series shall, with respect to the
      payment of dividends and the distribution of assets in the event of the
      liquidation, dissolution or winding-up of the Company, whether
      voluntary or involuntary, or any other distribution of the assets of
      the Company among its members for the purpose of winding-up its
      affairs, rank on a parity with the Class C Preferred Shares of every





                                     - 23 -


      other series and be entitled to a preference over the Class A Common
      Shares, Class B Preferred Shares and any other class ranking junior to
      the Class C Preferred Shares. The Class C Preferred Shares of any
      series shall also be entitled to such other preferences, not
      inconsistent with these provisions, over the Class A Common Shares, the
      Class B Preferred Shares and the shares of any other class ranking
      junior to the Class C Preferred Shares, as may be fixed in accordance
      with Article 20.10.

20.12 The approval of the holders of Class C Preferred Shares as a class, as
      to any matters referred to in these provisions or required by law may
      be given as specified below:

      (a)   any approval given by the holders of the Class C Preferred Shares
            shall be deemed to have been sufficiently given if it shall have
            been given in writing by the holders of all of the outstanding
            Class C Preferred Shares or by a resolution passed at a meeting of
            holders of Class C Preferred Shares duly called and held for such
            purpose upon not less than 21 days' notice at which the holders
            of at least a majority of the outstanding Class C Preferred
            Shares are present or are represented by proxy and carried by the
            affirmative vote of not less than 75% of the votes cast at such
            meeting. If at any such meeting the holders of a majority of the
            outstanding Class C Preferred Shares are not present or
            represented by proxy within 30 minutes after the time appointed
            for such meeting, then the meeting shall be adjourned to such
            date not less than 15 days thereafter and to such time and place
            as may be designated by the chairman of the meeting and not less
            than ten days' written notice shall be given of such adjourned
            meeting but it shall not be necessary in such notice to specify
            the purpose for which the meeting was originally called. At such
            adjournment meeting the holders of Class C Preferred Shares
            present or represented by proxy shall form a quorum and may
            transact the business for which the meeting was originally called
            and a resolution passed thereat by the affirmative vote of not
            less than 75% of the votes cast at such meeting shall constitute
            the approval of the holders of the Class C Preferred Shares;
            and

      (b)   on every poll taken at any such meeting each holder of Class C
            Preferred Shares shall be entitled to one vote in respect of each
            Class C Preferred Share held. Subject to the foregoing, the
            formalities to be observed with respect to the giving or waiving
            of notice of any such meeting and the conduct thereof shall be
            those from time to time prescribed in the Company Act and the
            articles of the Company with respect to meetings of shareholders.

20.13 Except as otherwise provided in the Company Act or these provisions,
      the holders of Class C Preferred Shares shall not, as such, be entitled
      to receive notice of, or attend or vote at, any meeting of the members
      of the Company.

EX-3.9

                                                                     EXHIBIT 3.9

                                                  ONTARIO CORPORATION NUMBER
                                                NUMERO DE LA SOCIETE EN ONTARIO

                                                           1333329






                              -----------------------------------------------------------------------------------------------------
                                                                     ARTICLES OF INCORPORATION
                                                                       STATUTS CONSTITUTIFS
                                                                                     

                              1. The name of the corporation is:                           DENOMINATION SOCIALE DE LA SOCIETE:
                              -----------------------------------------------------------------------------------------------------
                               S  M  C    N  O  M  I  N  E  E  C  O    I  N  C  .
            Form 1            -----------------------------------------------------------------------------------------------------
           Business
         Corporations         -----------------------------------------------------------------------------------------------------
             Act
                              -----------------------------------------------------------------------------------------------------
          FORMULE 1
         LOI SUR LES          -----------------------------------------------------------------------------------------------------
          SOCIETES
         PAR ACTIONS          2. The address of the registered office is:                  ADRESSE DU SIEGE SOCIAL:

                               333 KING STREET EAST
                              -----------------------------------------------------------------------------------------------------
                                           (Street & Number, or R.R. Number & if Multi-Office Building give Room No.)
                                   (RUE ET NUMERO, OU NUMERO DE LA R.R. ET S'IL S'AGIT D'UN EDIFICE A BUREAUX, NUMERO DU BUREAU)

                               TORONTO, ONTARIO                                                                         M 5 A 3 X 5
                              -----------------------------------------------------------------------------------------------------
                                                (Name of Municipality - Post Office)                                  (Postal Code)
                                             (NOM DE LA MUNICIPALITE OU BUREAU DE POSTE)                              (CODE POSTAL)

                              3. Number (or minimum and maximum number)                       NOMBRE (OU NOMBRE MINIMAL ET MAXIMAL)
                                 of directors                                                 D'ADMINISTRATEURS:

                                         MINIMUM 1, MAXIMUM 20

                              4. The first director(s) is are:             PREMIER(S) ADMINISTRATEUR(S):




                                                                                                                       Resident
                                                                                                                       Canadian
                                                                Residence address, giving Street & No. or R.R. No.     State Yes/No
                              Last name, initials and surname   Municipality and Postal Code.                          RESIDENT
                              PRENOM, INITIALES ET NOM DE       ADRESSE PERSONNELLE, Y COMPRIS LA RUE ET LE NUMERO     CANADIEN
                              FAMILLE                           DE LA R.R.  LE NOM DE LA MUNICIPALITE                  OUI/NON
                                                                ET LE CODE POSTAL.
                              -----------------------------------------------------------------------------------------------------
                                                                                                                 
                                TRUDY A. EAGAN                 52 CHESTNUT PARK ROAD                                        YES
                                                               TORONTO, ONTARIO M4W 1W8
                              


                                                                              2
                                                                               
                              5. Restrictions, if any, on business the corporation   LIMITES, S'IL Y A LIEU, IMPOSEES AUX ACTIVITES
                                 may carry on or on powers the corporation may       COMMERCIALES OU AUX POUVOIRS DE LA SOCIETE.
                                 exercise.

                                 THERE ARE NO RESTRICTIONS ON BUSINESS THE CORPORATION MAY CARRY ON, OR ON
                                 POWERS THE CORPORATION MAY EXERCISE.















                              6. The classes and any maximum number of shares        CATEGORIES ET NOMBRE MAXIMAL, S'IL Y A LIEU,
                                 that the corporation is authorized to issue:        D'ACTIONS QUE LA SOCIETE EST AUTORISE A
                                                                                     EMETTRE:


                                 THE CORPORATION IS AUTHORIZED TO ISSUE AN UNLIMITED NUMBER OF SHARES OF ONE
                                 CLASS, DESIGNATED AS COMMON SHARES.




                                                                              3
                                                                              
                              7. Rights, privileges, restrictions and conditions    DROITS, PRIVILEGES, RESTRICTIONS ET CONDITIONS,
                                 (if any) attaching to each class of shares and     S'IL Y A LIEU, RATTACHES A CHAQUE CATEGORIE
                                 directors authority with respect to any class      D'ACTIONS ET POUVOIRS DES ADMINISTRATEURS
                                 of shares which may be issued in series:           RELATIFS A CHAQUE CATEGORIE D'ACTIONS QUI PEUT
                                                                                    ETRE EMISE EN SERIE:


                                 THE RIGHTS OF THE HOLDERS OF COMMON SHARES OF THE CORPORATION ARE EQUAL IN
                                 ALL RESPECTS AND INCLUDE THE RIGHTS,

                                 (A) TO VOTE AT ALL MEETINGS OF SHAREHOLDERS; AND

                                 (B) TO RECEIVE THE REMAINING PROPERTY OF THE CORPORATION UPON DISSOLUTION.





                                                                              5
                                                                              
                              9. Other provisions, if any, are:                     AUTRES DISPOSITIONS, S'IL Y A LIEU:


                                 (A) THE NUMBER OF SHAREHOLDERS OF THE CORPORATION, EXCLUSIVE OF PERSONS WHO ARE IN THE
                                     EMPLOYMENT OF THE CORPORATION AND EXCLUSIVE OF PERSONS WHO, HAVING BEEN FORMERLY IN THE
                                     EMPLOYMENT OF THE CORPORATION, WERE, WHILE IN THAT EMPLOYMENT, AND HAVE CONTINUED AFTER
                                     TERMINATION OF THAT EMPLOYMENT TO BE, SHAREHOLDERS OF THE CORPORATION, IS LIMITED TO NOT MORE
                                     THAN FIFTY, TWO OR MORE PERSONS WHO ARE THE JOINT REGISTERED OWNERS OR ONE OR MORE SHARES
                                     BEING COUNTED AS ONE SHAREHOLDER.

                                 (B) ANY INVITATION TO THE PUBLIC TO SUBSCRIBE FOR SECURITIES OF THE CORPORATION IS PROHIBITED.

                                 (C) SUBJECT TO THE PROVISIONS OF THE BUSINESS CORPORATIONS ACT (ONTARIO) AS AMENDED OR RE-ENACTED
                                     FROM TIME TO TIME, THE DIRECTORS MAY, WITHOUT AUTHORIZATION OF THE SHAREHOLDERS:

                                     (I)   BORROW MONEY ON THE CREDIT OF THE CORPORATION;

                                     (II)  ISSUE, RE-ISSUE, SELL OR PLEDGE DEBT OBLIGATIONS OF THE CORPORATION;

                                     (III) GIVE A GUARANTEE ON BEHALF OF THE CORPORATION TO SECURE PERFORMANCE OF AN OBLIGATION
                                           OF ANY PERSON;

                                     (IV)  MORTGAGE, HYPOTHECATE, PLEDGE OR OTHERWISE CREATE A SECURITY INTEREST IN ALL OR ANY
                                           PROPERTY OF THE CORPORATION, OWNED OR SUBSEQUENTLY ACQUIRED, TO SECURE ANY OBLIGATION
                                           OF THE CORPORATION;

                                     (V)   BY RESOLUTION, DELEGATE ANY OR ALL SUCH POWERS TO A DIRECTOR, A COMMITTEE OF DIRECTORS
                                           OR AN OFFICER OF THE CORPORATION.

                                     NOTHING IN THIS SUBPARAGRAPH SHALL LIMIT OR RESTRICT THE BORROWING OF MONEY BY THE CORPORATION
                                     ON BILLS OF EXCHANGE OR PROMISSORY NOTES MADE, DRAWN, ACCEPTED OR ENDORSED BY OR ON BEHALF OF
                                     THE CORPORATION.

                                 (D) EXCEPT IN THE CASE OF ANY CLASS OR SERIES OF SHARES OF THE CORPORATION LISTED ON A STOCK
                                     EXCHANGE, THE CORPORATION SHALL HAVE A LIEN ON THE SHARES REGISTERED IN THE NAME OF A
                                     SHAREHOLDER OR HIS LEGAL REPRESENTATIVE FOR A DEBT OF THAT SHAREHOLDER TO THE CORPORATION.

                                 (E) THE HOLDERS OF ANY FRACTIONAL SHARES ISSUED BY THE CORPORATION SHALL BE ENTITLED TO EXERCISE
                                     VOTING RIGHTS AND TO RECEIVE DIVIDENDS IN RESPECT OF EACH SUCH FRACTIONAL SHARE.




                                                                              6
                                                                              
                             10. The names and addresses of the incorporators are   NOM ET ADRESSE DES FONDATEURS

                                                                                    Full residence address or address of registered
                                                                                    office or of principal place of business giving
                                 First name, initials and surname of corporate      street & No. or R.R. No., municipality and
                                 name                                               postal code
                                 PRENOM, INITIALE ET NOM DE FAMILLE OU              ADRESSE PERSONNELLE AU COMPLET, ADRESSE DU
                                 DENOMINATION SOCIALE                               SIEGE SOCIAL OU ADRESSE DE L'ETABLISSEMENT
                                                                                    PRINCIPAL, Y COMPRIS LA RUE ET LE NUMERO, LE
                                                                                    NUMERO DE LA R.R., LE NOM DE LA MUNICIPALITE ET
                                                                                    LE CODE POSTAL

                             ------------------------------------------------------------------------------------------------------

                              TRUDY A. EAGAN                                    52 CHESTNUT PARK ROAD
                                                                                TORONTO, ONTARIO M4W 1W8















                                 These articles are signed in duplicate             LES PRESENTS STATUTS SONT SIGNES EN DOUBLE
                                                                                    EXEMPLAIRE.
                             ------------------------------------------------------------------------------------------------------
                                                   Signatures of incorporators / SIGNATURES DES FONDATEURS




                                                                      /s/ Trudy A. Eagan
                             ------------------------------------------------------------------------------------------------------
                                                                        TRUDY A. EAGAN




                                                ONTARIO CORPORATION NO. 1333329


                            CERTIFIED COPY OF A
                    SPECIAL RESOLUTION OF THE SHAREHOLDER
                                    OF
                             SMC NOMINEECO INC.


     RESOLVED AS A SPECIAL RESOLUTION that the number of directors of the
Corporation be fixed at three, and that the board of directors of the
Corporation be empowered to determine from time to time the number of
directors of the Corporation, such determination to be made by resolution of
the board of directors.

     CERTIFIED to be a true copy of a special resolution of the shareholder
of SMC Nomineeco Inc. signed by the sole shareholder entitled to vote at a
meeting of shareholders on the 29th day of December, 1998, which resolution
is in full force and effect, unamended, as of the date hereof.

     DATED the 29th day of December, 1998.



                                    /s/ Trudy A. Eagan
                                    -----------------------------
                                    Trudy A. Eagan
                                    Secretary



                                    [STAMP]

EX-3.10

                                                                   EXHIBIT 3.10

                                  BY-LAW NO. 1

              A by-law relating generally to the regulation of the

                             business and affairs of

                               SMC NOMINEECO INC.


                                    CONTENTS



                                            
                    ONE                        INTERPRETATION
                    TWO                        DIRECTORS
                    THREE                      MEETINGS OF DIRECTORS
                    FOUR                       COMMITTEES
                    FIVE                       OFFICERS
                    SIX                        PROTECTION OF DIRECTORS,
                                               OFFICERS AND OTHERS
                    SEVEN                      MEETINGS OF SHAREHOLDERS
                    EIGHT                      SECURITIES
                    NINE                       DIVIDENDS AND RIGHTS
                    TEN                        EXECUTION OF DOCUMENTS
                                               AND VOTING OF SECURITIES
                    ELEVEN                     NOTICES


     RESOLVED as a by-law of SMC NOMINEECO INC. (hereinafter called the
"Corporation") as follows:

                                   SECTION ONE
                                 INTERPRETATION

1.1       DEFINITIONS.

     In this by-law and in all other by-laws of the Corporation, unless the
context otherwise requires:

     (a)  "Act" means the Business Corporations Act (Ontario) as amended or
          re-enacted from time to time and includes the regulations made
          pursuant thereto;

     (b)  "board" means the board of directors of the Corporation;

     (c)  "by-laws" means all by-laws of the Corporation;

     (d)  "director" means a director of the Corporation; and

     (e)  "non-business day" means Saturday, Sunday and any other day that is a
          holiday as defined in the Interpretation Act (Ontario);

          and

     (f)  "number of directors" means the number of directors provided for in
          the articles or, where a minimum and maximum number of directors is
          provided for in the articles, the number of directors determined by a
          special resolution or resolution of the board where it is empowered by
          special resolution to determine the number of directors.

Exhibit 3.10



                                      -2-


1.2      All terms used in the by-laws of the Corporation which are defined in
the Act shall have the meanings given to such terms under the Act.

1.3      In all by-laws of the Corporation, the singular shall include the
plural and the plural the singular and words importing gender include the
masculine, feminine and neuter genders.

1.4      Headings used in the by-laws are for convenience of reference only and
shall not affect the construction or interpretation thereof.

1.5      If any of the provisions contained in this by-law are inconsistent with
those contained in the articles or a unanimous shareholder agreement, the
provisions contained in the articles or unanimous shareholder agreement, as the
case may be, shall prevail.


                                   SECTION TWO
                                    DIRECTORS

2.1  QUORUM. The quorum for the transaction of business at any meeting of the
board shall consist of a majority of the number of directors; provided that
where the number of directors of the Corporation is two directors, both
directors must be present at any meeting of the board to constitute a quorum.

2.2  QUALIFICATION. No person shall be qualified for election as a director if
he is less than 18 years of age; if he is of unsound mind and has been so found
by a court in Canada or elsewhere; if he is not an individual; or if he has the
status of a bankrupt. A director need not be a shareholder. A majority of the
directors shall be resident Canadians provided that if the number of directors
is fewer than three, at least one shall be a resident Canadian.

2.3  ELECTION AND TERM. The election of directors shall take place at the first
meeting of shareholders and at each annual meeting of shareholders. A director
not elected for an expressly stated term shall cease to hold office at the close
of the first annual meeting following his election or appointment, If an
election of directors is not held at the proper time, the incumbent directors
shall continue in office until their successors are elected.

2.4  REMOVAL OF DIRECTORS. Subject to the provisions of the Act, the
shareholders may by ordinary resolution passed at an annual or special meeting
remove any director from office and the vacancy created by such removal may be
filled at the same meeting failing which it may be filled by the directors.

2.5  VACATION OF OFFICE. A director ceases to hold office when he dies; he is
removed from office by the shareholders; he ceases to be qualified for election
as a director; or his written resignation is received by the Corporation, or if
a time is specified in such resignation, at the time so specified, whichever is
later; provided that a director named in the articles is not permitted to resign
his office unless at the time the resignation is to become effective a successor
is elected or appointed.

2.6  VACANCIES. Subject to the provisions of the Act, if a quorum of the board
remains in office, the board may fill a vacancy in the board, except:

          (a)  a vacancy resulting from (i) an increase in the number of
               directors otherwise than by a resolution of the directors, or in
               the maximum number of directors, or from (ii) a failure to elect
               the number of directors required to be elected at any meeting of
               the shareholders; or

          (b)  where the directors are empowered to determine the number of
               directors, if, after such appointment, the total number of
               directors would be greater than one and one-third times the
               number of directors required to have been elected at the last
               annual meeting of shareholders.

               In the absence of a quorum of the board, or if the board is not
               permitted to fill such vacancy, the



                                      -3-


board shall forthwith call a special meeting of shareholders to fill the
vacancy. If the board fails to call such meeting or if there are no such
directors then in office, any shareholder may call the meeting.

2.7  REMUNERATION AND EXPENSES. The directors shall be paid such remuneration
for their services as the board may from time to time determine and shall also
be entitled to be reimbursed for travelling and other expenses properly incurred
by them in attending meetings of the board or any committee thereof. Nothing
herein contained shall preclude any director from serving the Corporation in any
other capacity and receiving remuneration therefor.

                                  SECTION THREE
                              MEETINGS OF DIRECTORS

3.1  CANADIAN MAJORITY. The board shall not transact business at a meeting,
other than filling a vacancy in the board, unless a majority of the directors
present are resident Canadians, except where

     (a)  a resident Canadian director who is unable to be present approves in
          writing or by telephone or other communications facilities the
          business transacted at the meeting;

     (b)  a majority of resident Canadians would have been present had that
          director been present at the meeting; and

     (c)  the Corporation has only one or two directors, that director or one of
          the two directors, as the case may be, shall be a resident Canadian.

3.2  MEETINGS BY TELEPHONE. If all the directors present at or participating in
the meeting consent, any or all of the directors may participate in a meeting of
the board or of a committee of the board by means of such telephone, electronic
or other communications facilities as to permit all persons participating in the
meeting to communicate with each other, simultaneously and instantaneously, and
any director participating in such a meeting by such means is deemed to be
present at the meeting. Any such consent shall be effective whether given before
or after the meeting to which it relates and may be given with respect to all
meetings of the board and of committees of the board held while a director holds
office.

3.3  PLACE OF MEETINGS. Meetings of the board may be held at any place within or
outside Ontario. In any financial year of the Corporation, a majority of the
meetings of the board need not be held within Canada.

3.4  CALLING OF MEETINGS. Meetings of the board may be convened at any time by
the president or any director upon notice given to all directors in accordance
with subsection 3.5.

3.5  NOTICE OF MEETING. Notice of the time and place of each meeting of the
board shall be given in the manner provided in subsection 11.1 to each director
(a) not less than 48 hours before the time when the meeting is to be held if the
notice is mailed, or (b) not less than 24 hours before the time the meeting is
to be held if the notice is given personally or is delivered or is sent by any
means of transmitted or recorded communication.

3.6  WAIVER OF NOTICE. A director may in any manner or at any time waive notice
of or otherwise consent to a meeting of the board. Attendance of a director at a
meeting of the board shall constitute a waiver of notice of that meeting except
where a director attends for the express purpose of objecting to the transaction
of any business on the grounds that the meeting has not been properly called.

3.7  FIRST MEETING OF NEW BOARD. Provided a quorum of directors is present, each
newly elected board may without notice hold its first meeting immediately
following the meeting of shareholders at which such board is elected.

3.8  ADJOURNED MEETING. Notice of an adjourned meeting of the board is not
required if the time and place of the adjourned meeting is announced at the
original meeting.



                                      -4-


3.9  REGULAR MEETINGS. The board may appoint a day or days in any month or
months for regular meetings of the board at a place and hour to be named. A
copy of any resolution of the board fixing the place and time of such regular
meetings shall be sent to each director forthwith after being passed, but no
other notice shall be required for any such regular meeting except where the
Act requires the purpose thereof or the business to be transacted thereat to
be specified.

3.10  CHAIRMAN. The chairman of any meeting of the board shall be the first
mentioned of such of the following officers as have been appointed and who,
with the exception of the Chairman of the Board, is a director and is present
at the meeting: chairman of the board, managing director, president, or a
vice-president (in order of seniority). If no such officer is present, the
directors present shall choose one of their number to be chairman.

3.11  VOTES TO GOVERN. At all meetings of the board, every question shall be
decided by a majority of the votes cast on the question. In case of an
equality of votes, the chairman of the meeting shall not be entitled to a
second or casting vote.

3.12  ONE DIRECTOR MEETING. Where the board consists of only one director,
that director may constitute a meeting.

                                  SECTION FOUR
                                   COMMITTEES

4.1  COMMITTEE OF DIRECTORS. The board may appoint from their number one or
more committees of the board, however designated, and delegate to such
committee any of the powers of the board except those which, under the Act, a
committee of the board has no authority to exercise. A majority of the
members of any such committee shall be resident Canadians.

4.2  AUDIT COMMITTEE. If the Corporation is an offering corporation the board
shall, and otherwise the board may, constitute an audit committee composed of
not fewer than three directors, a majority of whom are not officers or
employees of the Corporation or any of its affiliates, and who shall hold
office until the next annual meeting of shareholders. The audit committee
shall have the powers and duties provided in the Act.

4.3  TRANSACTION OF BUSINESS. The powers of a committee of the board may be
exercised by a meeting at which a quorum is present or by resolution in
writing signed by all the members of such committee who would have been
entitled to vote on that resolution at a meeting of the committee. Meetings
of such committee may be held at any place within or outside Ontario.

4.4  PROCEDURE. Unless otherwise determined by the board, each committee
shall have the power to fix its quorum at not less than a majority of its
members, to elect its chairman and to regulate its procedure. To the extent
that the board or the committee does not establish rules to regulate the
procedure of the committee, the provisions of this by-law applicable to
meetings of the board shall apply mutatis mutandis.

                                  SECTION FIVE
                                    OFFICERS

5.1  APPOINTMENT. The board may designate the offices of the Corporation and
from time to time appoint a chairman of the board, managing director
(provided he is a resident Canadian), president, one or more vice-presidents
(to which title may be added words indicating seniority or function), a
secretary, a treasurer and such other officers as the board may determine,
including one or more assistants to any of the officers so appointed. The
board may specify the duties of and, in accordance with this by-law and
subject to the provisions of the Act, delegate to such officers powers to
manage the business and affairs of the Corporation. One person may hold more
than one office and, except for the chairman of the board and the managing
director, an officer need not be a director.

5.2  CHAIRMAN OF THE BOARD. If appointed, the board may assign to the
chairman of the


                                      -5-


board any of the powers and duties that are by any provisions of this by-law
assigned to the managing director or to the president and subject to the Act,
such other powers and duties as the board may specify. The chairman of the board
shall, when present, preside at all meetings of the board and shareholders.
Subject to subsections 3.10 and 7.9, during the absence or disability of the
chairman of the board, his duties shall be performed and his powers exercised by
the first mentioned of the following officers then in office: the managing
director, the president, or a vice-president (in order of seniority).

5.3  MANAGING DIRECTOR. If appointed, the managing director shall be the
chief executive officer and, subject to the authority of the board, shall
have general supervision of the business and affairs of the Corporation; and
he shall, subject to the provisions of the Act, have such other powers and
duties as the board may specify. During the absence or disability of the
president, or if no president has been appointed, the managing director shall
also have the powers and duties of that office.

5.4  PRESIDENT. If appointed, the president shall have general supervision of
the business and affairs of the Corporation, subject to the direction and
authority of the board, the chairman of the board and the managing director;
and he shall have such other powers and duties as the board may specify.
During the absence or disability of the managing director, or if no managing
director has been appointed, the president shall also have the powers and
duties of that office. In the absence of the appointment of a managing
director or the designation of the chairman of the board as such, the
president shall be the chief executive officer of the Corporation. Otherwise,
the president shall be the chief operating officer of the Corporation.

5.5  VICE-PRESIDENT. The vice-president, or if more than one, the
vice-presidents, in order of seniority as designated by the board, shall be
vested with all the powers and perform all the duties of the president in his
absence, inability or refusal to act except that he shall not preside at any
meeting of the directors unless he is appointed to do so by the board. A
vice-president shall have such powers and duties as the board or the chief
executive officer may specify.

5.6  SECRETARY. The secretary shall attend and be the secretary of all
meetings of the board, shareholders and committees of the board and shall
enter or cause to be entered in records kept for that purpose minutes of all
proceedings thereat; he shall give or cause to be given, as and when
instructed, all notices to shareholders, directors, officers and auditors; he
shall be the custodian of all books, papers, records, documents and
instruments belonging to the Corporation, except when some other officer or
agent has been appointed for that purpose; and he shall have such other
powers and duties as the board or the chief executive officer may specify.

5.7  TREASURER. The treasurer shall keep or cause to be kept proper
accounting records in compliance with the Act and shall be responsible for
the deposit of money, the safekeeping of securities and the disbursement of
funds of the Corporation; he shall render to the board whenever required an
account of all his transactions as treasurer and of the financial position of
the corporation; and he shall have such other powers and duties as the board
or the chief executive officer may specify.

5.8  POWERS AND DUTIES OF OTHER OFFICERS. The powers and duties of all other
officers shall be such as the terms of their engagement call for or as the
board or the chief executive officer may specify. Any of the powers and
duties of an officer to whom an assistant has been appointed may be exercised
and performed by such assistant, unless the board or the chief executive
officer otherwise directs.

5.9  VARIATION OF POWERS AND DUTIES. Subject to the provisions of the Act,
the board may from time to time vary, add to or limit the powers and duties
of any officer.

5.10  TERM OF OFFICE. The board, in its discretion, may remove any officer of
the Corporation, without prejudice to such officer's rights under any
employment contract. Otherwise, each officer appointed by the board shall
hold office until his successor is appointed, except that the term of office
of the chairman of the board or managing director shall expire when the
holder thereof ceases to be a director.

5.11  AGENTS AND ATTORNEYS. The board shall have power from time to time to
appoint agents or attorneys for the Corporation in or out of Ontario with
such powers of management or otherwise (including the


                                      -6-


power to sub-delegate) as may be thought fit.

5.12  FIDELITY BONDS. The board may require such officers, employees and
agents of the Corporation as the board deems advisable to furnish bonds for
the faithful discharge of their duties, in such form and with such surety as
the board may from time to time prescribe.

                                   SECTION SIX
                      PROTECTION OF DIRECTORS AND OFFICERS

6.1  LIMITATION OF LIABILITY. No director or officer shall be liable for the
acts, receipts, neglects or defaults of any other director, officer,
employee, or agent, or for joining in any receipt or other act for
conformity, or for any loss, damage or expense happening to the Corporation
through the insufficiency or deficiency of title to any property acquired for
or on behalf of the Corporation, or for the insufficiency or deficiency of
any security in or upon which any of the moneys of the Corporation shall be
invested, or for any loss or damage arising from the bankruptcy, insolvency
or tortious acts of any person with whom any of the moneys, securities or
effects of the Corporation shall be deposited, or for any loss occasioned by
any error of judgment or oversight on his part, or for any other loss, damage
or misfortune whatever which shall happen in the execution of the duties of
his office or in relation thereto, unless the same are occasioned by his own
wilful neglect or default; provided that nothing herein shall relieve any
director or officer from the duty to act in accordance with the Act or from
liability for any breach thereof.

6.2  INDEMNITY. The Corporation shall indemnify and save harmless every
director or officer, every former director or officer, and every person who
acts or acted at the Corporation's request as a director or officer of a body
corporate of which the Corporation is or was a shareholder or creditor (or a
person who undertakes or has undertaken any liability on behalf of the
Corporation or any such body corporate) and his heirs and legal
representatives, from and against all costs, charges and expenses, including
an amount paid to settle an action or satisfy a judgment, reasonably incurred
by him in respect of any civil, criminal or administrative action or
proceeding to which he is made a party by reason of being or having been a
director or officer of the Corporation or such body corporate, if:

     (a)  he acted honestly and in good faith with a view to the best interests
          of the Corporation; and

     (b)  in the case of a criminal or administrative action or proceeding that
          is enforced by a monetary penalty, he had reasonable grounds for
          believing that his conduct was lawful.

6.3  INSURANCE. Subject to the limitations contained in the Act, the
Corporation may purchase and maintain such insurance for the benefit of any
person referred to in subsection 6.2 hereof, as the board may from time to
time determine.

                                  SECTION SEVEN
                            MEETINGS OF SHAREHOLDERS

7.1  ANNUAL MEETINGS. The annual meeting of shareholders shall be held at
such time in each year and, subject to subsection 7.3, at such place as the
board, the chairman of the board, the managing director or the president may
from time to time determine, for the purpose of considering the financial
statements and reports required by the Act to be placed before the annual
meeting, electing directors, appointing auditors and fixing or authorizing
the board to fix their remuneration, and for the transaction of such other
business as may properly be brought before the meeting.

7.2  SPECIAL MEETINGS. The board, the chairman of the board, the managing
director or the president or any registered shareholder shall have power to
call a special meeting of shareholders at any time.

7.3  PLACE OF MEETINGS. Meetings of shareholders shall be held at the place
where the registered office of the Corporation is situate or, if the board
shall so determine, at some other place within or outside of Ontario.


                                      -7-


7.4  MEETINGS BY TELEPHONE. If all the shareholders present at or
participating in the meeting consent, any or all of the shareholders may
participate in a meeting of the shareholders by means of such telephone,
electronic or other communications facilities as to permit all persons
participating in the meeting to communicate with each other, simultaneously
and instantaneously, and any shareholder participating in such a meeting by
such means is deemed to be present at the meeting. Any such consent shall be
effective whether given before or after the meeting to which it relates and
may be given with respect to all meetings of the shareholders while such
individual(s) continue to be a shareholder.

7.5  NOTICE OF MEETINGS. Notice of the time and place of each meeting of
shareholders (and of each meeting of shareholders adjourned for an aggregate
of 30 days or more) shall be given in the manner provided in subsection 11 .1
not less than ten days (or such lesser number of days then required under the
Act or any other applicable legislation, regulation or administrative
policy), unless the Corporation is an offering corporation in which case not
less than 21 days, nor, in either case, more than 50 days before the date of
the meeting, to each director, to the auditor and to each shareholder who at
the close of business on the record date for notice, if any, is entered in
the securities register as the holder of one or more shares carrying the
right to vote at the meeting. Notice of a meeting of shareholders called for
any purpose other than consideration of the financial statements and
auditor's report, election of directors and re-appointment of the incumbent
auditor shall state the nature of such business in sufficient detail to
permit a shareholder to form a reasoned judgment thereon and shall state the
text of any special resolution or by-law to be submitted to the meeting. A
shareholder and any other person entitled to attend a meeting of shareholders
may in any manner and at any time waive notice of or otherwise consent to a
meeting of shareholders. Attendance of any such person at a meeting of
shareholders shall constitute a waiver of notice of the meeting except where
he attends a meeting for the express purpose of objecting to the transaction
of any business on the grounds that the meeting is not properly called.

7.6  LIST OF SHAREHOLDERS ENTITLED TO NOTICE. For every meeting of
shareholders, the Corporation shall prepare a list of shareholders entitled
to receive notice of the meeting, arranged in alphabetical order and showing
the number of shares entitled to vote at the meeting held by each
shareholder. If a record date for the meeting is fixed pursuant to subsection
7.7, the shareholders listed shall be those registered at the close of
business on the record date and such list shall be prepared not later than
ten days after such record date. If no record date is fixed, the list shall
be prepared at the close of business on the day immediately preceding the day
on which notice of the meeting is given, or where no such notice is given,
the day on which the meeting is held and shall list all shareholders
registered at such time. The list shall be available for examination by any
shareholder during usual business hours at the registered office of the
Corporation or at the place where the securities register is kept and at the
place where the meeting is held.

7.7  RECORD DATE FOR NOTICE. The board may fix in advance a record date,
preceding the date of any meeting of shareholders by not more than 50 days
and not less than 21 days, for the determination of the shareholders entitled
to notice of the meeting; and notice of any such record date shall be given
not less than seven days before such record date by newspaper advertisement
in the manner provided in the Act. If no record date is so fixed, the record
date for the determination of the shareholders entitled to notice of the
meeting shall be the close of business on the day immediately preceding the
day on which the notice is given.

7.8  MEETINGS WITHOUT NOTICE. A meeting of shareholders may be held without
notice at any time and place permitted by the Act in accordance with the
requirements of the Act and any other applicable legislation, regulation or
administrative policy. At such a meeting, any business may be transacted
which the Corporation at a meeting of shareholders may transact.

7.9  CHAIRMAN, SECRETARY AND SCRUTINEERS. The chairman of any meeting of
shareholders shall be the first mentioned of such of the following officers
as have been appointed and who is present at the meeting: chairman of the
board, managing director, president, or a vice-president who is a
shareholder. If no such officer is present within 15 minutes from the time
fixed for holding the meeting, the persons present and entitled to vote shall
choose one of their number to be chairman. If the secretary of the
Corporation is absent, the chairman shall appoint some person, who need not
be a shareholder, to act as secretary of the meeting. If desired, one or more
scrutineers, who need not be shareholders, may be appointed by a resolution
or by the chairman with the consent of the meeting.


                                      -8-


7.10  PERSONS ENTITLED TO BE PRESENT. The only persons entitled to be present
at a meeting of the shareholders shall be those entitled to vote thereat, the
directors and auditor of the Corporation and others who, although not
entitled to vote, are entitled or required under any provision of the Act,
the articles or the by-laws to be present at the meeting. Any other person
may be admitted only on the invitation of the chairman of the meeting or with
the consent of the meeting.

7.11  QUORUM. A quorum for the transaction of business at any meeting of
shareholders shall be two persons, present in person, each being a
shareholder entitled to vote thereat or a duly appointed proxy for an absent
shareholder so entitled. Notwithstanding the foregoing, if the Corporation
has only one shareholder, or only one shareholder of any class or series of
shares, the shareholder present in person or by proxy constitutes a meeting
and a quorum for such meeting.

7.12  RIGHT TO VOTE. Subject to the provisions of the Act as to authorized
representatives of any other body corporate, at any meeting of shareholders
in respect of which the Corporation has prepared the list referred to in
subsection 7.6, every person who is named in such list shall be entitled to
vote the shares shown thereon opposite his name except to the extent that
such person has transferred any of his shares after the date on which the
list is prepared or, where a record date has been fixed, after the record
date and the transferee, upon producing properly endorsed certificates
evidencing such shares or otherwise establishing that he owns such shares,
demands at any time prior to the meeting that his name be included to vote
the transferred shares at the meeting. In the absence of a list prepared as
aforesaid in respect of a meeting of shareholders, every person shall be
entitled to vote at the meeting who at the time is entered in the securities
register as the holder of one or more shares carrying the right to vote at
such meeting.

7.13  PROXIES. Every shareholder entitled to vote at a meeting of
shareholders may appoint a proxyholder, or one or more alternate
proxyholders, who need not be shareholders, to attend and act at the meeting
in the manner and to the extent authorized and with the authority conferred
by the proxy. A proxy shall be in writing executed by the shareholder or his
attorney and shall conform with the requirements of the Act.

7.14  TIME FOR DEPOSIT OF PROXIES. The board may specify in a notice calling
a meeting of shareholders a time, preceding the time of such meeting by not
more than 48 hours exclusive of non-business days, before which time proxies
to be used at such meeting must be deposited. A proxy shall be acted upon
only if, prior to the time so specified, it shall have been deposited with
the Corporation or an agent thereof specified in such notice or, if no such
time is specified in such notice, unless it has been received by the
secretary of the Corporation or by the chairman of the meeting or any
adjournment thereof prior to the time of voting.

7.15  JOINT SHAREHOLDERS. If two or more persons hold shares jointly, any one
of them present in person or represented by proxy at a meeting of
shareholders may, in the absence of the other or others, vote the shares; but
if two or more of those persons are present in person or represented by proxy
and vote, they shall vote as one the shares jointly held by them.

7.16  VOTES TO GOVERN. At any meeting of shareholders every question shall,
unless otherwise required by law, be determined by the majority of the votes
cast on the question. In the case of an equality of votes either upon a show
of hands or upon a ballot, the chairman of the meeting shall not be entitled
to a second or casting vote.

7.17  SHOW OF HANDS. Subject to the provisions of the Act, any question at a
meeting of shareholders shall be decided by a show of hands unless a ballot
thereon is required or demanded as hereinafter provided. Upon a show of
hands, every person who is present and entitled to vote shall have one vote.
Whenever a vote by show of hands shall have been taken upon a question,
unless a ballot thereon is so required or demanded, a declaration by the
chairman of the meeting as to the result of the vote upon the question and an
entry to that effect in the minutes of the meeting shall be prima facie
evidence of the fact without proof of the number or proportion of the votes
recorded in favour of or against any resolution or other proceeding in
respect of such question, and the result of the vote so taken shall be the
decision of the shareholders upon such question.

7.18  BALLOTS. On any question proposed for consideration at a meeting of
shareholders, and whether or not a show of hands has been taken thereon, any
shareholder or proxyholder entitled to vote at the


                                      -9-


meeting may demand a ballot. A ballot so demanded shall be taken in such manner
as the chairman shall direct. A demand for a ballot may be withdrawn at any time
prior to the taking of the ballot. The result of the ballot so taken shall be
the decision of the shareholders upon the question.

7.19  RESOLUTION IN WRITING. A resolution in writing signed by all of the
shareholders entitled to vote on that resolution at a meeting of shareholders
(or such lesser number of shareholders as are then required for a written
resolution to be effective pursuant to the Act and any other applicable
legislation, regulation or administrative policy) is as valid as if it had
been passed at a meeting of the shareholders unless a written statement with
respect to the subject matter of the resolution is submitted by a director or
the auditor in accordance with the Act.

                                  SECTION EIGHT
                                   SECURITIES

8.1  REGISTRATION OF TRANSFER. Subject to the provisions of the Act, no
transfer of shares shall be registered in a securities register except upon
presentation of the certificate representing such shares with a transfer
endorsed thereon or delivered therewith duly executed by the registered
holder or by his attorney or successor duly appointed, together with such
reasonable assurance or evidence of signature, identification and authority
to transfer as the board may from time to time prescribe, upon payment of all
applicable taxes and any fees prescribed by the board, upon compliance with
such restrictions on transfer as are authorized by the articles and upon
satisfaction of any lien referred to in subsection 8.4.

8.2  TRANSFER AGENTS AND REGISTRARS. The board may from time to time appoint
a registrar to maintain the securities register and a transfer agent to
maintain the register of transfers and may also appoint one or more branch
registrars to maintain branch securities registers and one or more branch
transfer agents to maintain branch registers of transfers, but one person may
be appointed both registrar and transfer agent. The board may at any time
terminate any such appointment.

8.3  LIEN ON SHARES. The Corporation has a lien on any share or shares
registered in the name of a shareholder or his legal representative for any
debt of that shareholder to the Corporation.

8.4  ENFORCEMENT OF LIEN. The lien referred to in subsection 8.3 may be
enforced by any means permitted by law and:

     (a)  where the share or shares are redeemable pursuant to the articles of
          the Corporation by redeeming such share or shares and applying the
          redemption price to the debt;

     (b)  subject to the Act, by purchasing the share or shares for cancellation
          for a price equal to the book value of such share or shares and
          applying the proceeds to the debt;

     (c)  by selling the share or shares to any third party whether or not such
          party is at arm's length to the Corporation, and including, without
          limitation, any officer or director of the Corporation, for the best
          price which the directors consider to be obtainable for such share or
          shares; or

     (d)  by refusing to register a transfer of such share or shares until the
          debt is paid.

8.5  SECURITY CERTIFICATES. Every holder of securities of the Corporation
shall be entitled, at his option, to a security certificate, or to a
non-transferable written acknowledgement of his right to obtain a security
certificate, stating the number and designation, class or series of
securities held by him as shown on the securities register. Security
certificates and acknowledgements of a securities holder's right to a
security certificate, respectively, shall be in such form as the board shall
from time to time approve. Any security certificate shall be signed in
accordance with subsection 10.1. A security certificate shall be signed
manually by at least one director or officer of the Corporation or by or on
behalf of the transfer agent and/or registrar. Any additional signatures
required may be printed or otherwise mechanically reproduced. A security
certificate executed as aforesaid shall be valid notwithstanding that one of
the directors or officers whose facsimile signature appears thereon no longer
holds


                                      -10-


office at the date of issue of the certificate.

8.6  REPLACEMENT OF SECURITY CERTIFICATES. The board, any officer or any
agent designated by the board may in its or his discretion direct the issue
of a new security certificate in lieu of and upon cancellation of a security
certificate that has been mutilated. In the case of a security certificate
claimed to have been lost, destroyed or wrongfully taken, the board, any
officer or any agent designated by the board shall issue a substitute
security certificate if so requested before the Corporation has notice that
the security has been acquired by a bona fide purchaser. The issuance of the
substitute security certificate shall be on such reasonable terms as to
indemnity, reimbursement of expenses and evidence of loss and of title as the
board or the officer or the agent designated by the board responsible for
such issuance may from time to time prescribe, whether generally or in any
particular case.

8.7  JOINT SHAREHOLDERS. If two or more persons are registered as joint
holders of any security, the Corporation shall not be bound to issue more
than one certificate in respect thereof, and delivery of such certificate to
one of such persons shall be sufficient delivery to all of them. Any one of
such persons may give effectual receipts for the certificate issued in
respect thereof or for any dividend, bonus, return of capital or other money
payable or warrant issuable in respect of such security.

8.8  DECEASED SECURITY HOLDERS. Subject to the provisions of paragraph 8.9
below, in the event of the death of a holder of any security, the Corporation
shall not be required to make any entry in the securities register in respect
thereof or to make payment of any dividends thereon except upon production of
all such documents as may be required by law and upon compliance with the
reasonable requirements of the Corporation, which reasonable requirements
shall in the discretion of the board not necessarily include the production
of letters probate or letters of administration.

8.9  DECEASED JOINTLY-HELD SECURITY HOLDERS. Where a share is registered in
the name of two or more persons as joint holders with rights of survivorship,
upon satisfactory proof of the death of one joint holder and without the
requirement of letters probate or letters of administration, the Corporation
shall treat the surviving joint holder(s) as the sole owner(s) of the share
effective as of the date of death of such joint holder and the Corporation
shall make the appropriate entry in the securities register to reflect such
ownership.

                                  SECTION NINE
                              DIVIDENDS AND RIGHTS

9.1  DIVIDENDS. Subject to the provisions of the Act, the board may from time
to time by resolution declare and the Corporation may pay dividends to the
shareholders according to their respective rights and interests in the
Corporation.

Dividends may be paid in money or property, subject to the restrictions on the
declaration and payment thereof under the Act, or by issuing fully paid shares
of the Corporation or options or rights to acquire fully paid shares of the
Corporation.

9.2  DIVIDEND CHEQUES. A dividend payable in cash shall be paid by cheque
drawn on the Corporation's bankers or one of them to the order of each
registered holder of shares of the class or series in respect of which it has
been declared and mailed by prepaid ordinary mail to such registered holder
at his recorded address, unless such holder otherwise directs. In the case of
joint holders the cheque shall, unless such joint holders otherwise direct,
be made payable to the order of all of such joint holders and mailed to them
at their recorded address. The mailing of such cheque as aforesaid, unless
the same is not paid on due presentation, shall satisfy and discharge the
liability for the dividend to the extent of the sum represented thereby plus
the amount of any tax which the Corporation is required to and does withhold.

9.3  NON-RECEIPT OF CHEQUES. In the event of non-receipt of any dividend
cheque by the person to whom it is sent as aforesaid, the Corporation shall
issue to such person a replacement cheque for a like amount on such terms as
to indemnity, reimbursement of expenses and evidence of non-receipt and of
title as the board may from time to time prescribe, whether generally or in
any particular case.


                                      -11-


9.4  RECORD DATE FOR DIVIDENDS AND RIGHTS. The board may fix in advance a
date as a record date for the determination of the persons entitled to
receive payment of dividends and to subscribe for securities of the
Corporation, provided that such record date shall not precede by more than 50
days the particular action to be taken. Notice of any such record date shall
be given not less than seven days before such record date, by newspaper
advertisement in the manner provided in the Act, unless notice of the record
date is waived by every holder of a share of the class or series affected
whose name is set out in the securities register at the close of business on
the day the directors fix the record date. If the shares of the Corporation
are listed for trading on one or more stock exchanges in Canada, notice of
such record date shall also be sent to such stock exchanges. Where no record
date is fixed in advance as aforesaid, the record date for the determination
of the persons entitled to receive payment of any dividend or to exercise the
right to subscribe for securities of the Corporation shall be at the close of
business on the day on which the resolution relating to such dividend or
right to subscribe is passed by the board.

9.5  UNCLAIMED DIVIDENDS. Any dividend unclaimed after a period of six years
from the date on which it has been declared to be payable shall be forfeited
and shall revert to the Corporation.

                                   SECTION TEN
                                     GENERAL

10.1  EXECUTION OF INSTRUMENTS. Contracts, documents and other instruments in
writing may be signed on behalf of the Corporation by such person or persons
as the board may from time to time by resolution designate. In the absence of
an express designation as to the persons authorized to sign either contracts,
documents or instruments in writing generally or to sign specific contracts,
documents or instruments in writing, any one of the directors or officers of
the Corporation may sign contracts, documents or instruments in writing on
behalf of the Corporation. The corporate seal, if any, of the Corporation may
be affixed to any contract, obligation or instrument in writing requiring the
corporate seal of the Corporation by any person authorized to sign the same
on behalf of the Corporation.

     The phrase "contracts, documents and other instruments in writing" as used
in this provision shall include deeds, mortgages, hypothecs, charges,
conveyances, transfers and assignments of property, real or personal, immovable
or movable, agreements, releases, receipts and discharges for the payment of
money or other obligations, conveyances, transfers and assignments of
securities, all paper writings, all cheques, drafts or orders for the payment of
money and all notes, acceptances and bills of exchange.

10.2  VOTING RIGHTS IN OTHER CORPORATIONS. All securities carrying voting
rights of any other corporation held from time to time by the Corporation may
be voted at any and all meetings of shareholders, bond holders, debenture
holders or holders of other securities (as the case may be) of such other
corporation and in such manner as the board may from time to time determine.
Any person or persons authorized to sign on behalf of the Corporation may
also from time to time execute and deliver for and on behalf of the
Corporation proxies and/or arrange for the issuance of voting certificates
and/or other evidence of the right to vote in such names as they may
determine.

                                 SECTION ELEVEN
                                     NOTICES

11.1  METHOD OF SENDING NOTICE. Any notice (which term includes any
communication or document) to be sent pursuant to the Act, the articles, the
by-laws or otherwise to a shareholder, director, officer, or to the auditor
shall be sufficiently sent if delivered personally to the person to whom it
is to be sent or if delivered to his recorded address or if mailed to him at
his recorded address by prepaid mail or if sent to him at his recorded
address by any means of prepaid transmitted or recorded communication. A
notice so delivered shall be deemed to have been sent when it is delivered
personally or to the recorded address as aforesaid; a notice so mailed shall
be deemed to have been sent when deposited in a post office or public letter
box and shall be deemed to have been received on the fifth day after so
depositing; and a notice so sent by any means of transmitted or recorded
communication shall be deemed to have been sent when dispatched by the
Corporation if it uses its own facilities and otherwise when delivered to the
appropriate communication company or agency or its representative for
dispatch. The secretary may change or cause to be changed the recorded
address of any shareholder, director, officer


                                      -12-


or auditor in accordance with any information believed by him to be reliable.
The recorded address of a director shall be his latest address as shown in the
records of the Corporation or in the most recent notice filed under the
Corporations Information Act, whichever is the more current.

11.2  NOTICE TO JOINT SHAREHOLDERS. If two or more persons are registered as
joint holders of any share, any notice shall be addressed to all of such
joint holders but notice sent to one of such persons shall be sufficient
notice to all of them.

11.3  COMPUTATION OF TIME. In computing the date when notice must be sent
under any provision requiring a specified number of days notice of any
meeting or other event, both the date of sending the notice and the date of
the meeting or other event shall be excluded.

11.4  UNDELIVERED NOTICES. If any notice sent to a shareholder pursuant to
subsection 11.1 is returned on three consecutive occasions because the
shareholder cannot be found, the Corporation shall not be required to give
any further notices to such shareholder until he informs the Corporation in
writing of his new address.

11.5  OMISSIONS AND ERRORS. The accidental omission to send any notice to any
shareholder, director, officer or to the auditor or the non-receipt of any
notice by any such person or any error in any notice not affecting the
substance thereof shall not invalidate any action taken at any meeting held
pursuant to such notice or otherwise founded thereon.

11.6  PERSONS ENTITLED BY OPERATION OF LAW. Every person who, by operation of
law, transfer or by any other means whatsoever, shall become entitled to any
share, shall be bound by every notice in respect of such share which shall
have been duly sent to the shareholder from whom he derives his title to such
share prior to his name and address being entered on the securities register
(whether such notice was given before or after the happening of the event
upon which he became so entitled).

11.7  DECEASED SHAREHOLDERS. Any notice duly sent to any shareholder shall be
deemed to have been duly served in respect of the shares held by the
shareholder (whether held solely or with other persons), notwithstanding that
such shareholder is then deceased and whether or not the Corporation has
notice of his death, until some other person is entered in his stead in the
securities register of the Corporation as the holder or as one of the holders
thereof and such service shall for all purposes be deemed a sufficient
service of notice to his heirs, executors or administrators and all persons,
if any, interested with him in such shares.

11.8  WAIVER OF NOTICE. Any shareholder (or his duly appointed proxyholder),
director, officer or auditor may at any time waive any notice, or waive or
abridge the time for any notice, required to be given to him under any
provisions of the Act, the regulations thereunder, the articles, the by-laws
or otherwise and such waiver or abridgement shall cure any default in the
giving or in the time of such notice, as the case may be. Any such waiver or
abridgement shall be in writing except a waiver of notice of a meeting of
shareholders or of the board which may be given in any manner.

11.9  EXECUTION OF NOTICES. The signature of any director or officer of the
Corporation to any notice may be written, stamped, typewritten or printed or
partly written, stamped, typewritten or printed.

11.10  PROOF OF SERVICE. A certificate of any officer or director of
the Corporation in office at the time of making of the certificate or of an
agent of the Corporation as to facts in relation to the sending of any
notice to any shareholder, director, officer or auditor or publication of
any notice shall be conclusive evidence thereof and shall be binding on every
shareholder, director, officer or auditor of the Corporation, as the case may
be.

     The foregoing resolution making By-law No. 1 of the Corporation, being a
by-law relating generally to the regulation of the business and affairs of the
Corporation, is hereby signed by all of the directors of the Corporation.



                                      -13-


     DATED the 29th day of December, 1998.








/s/ Paul V. Godfrey                    /s/ Trudy A. Eagan
- ----------------------                 ----------------------
    Paul V. Godfrey                        Trudy A. Eagan



                                       /s/ Bruce L. Jackson
                                       ----------------------
                                           Bruce L. Jackson



                                      -14-


     The foregoing By-law No. 1 of the Corporation, made by all of the
directors, is hereby confirmed by the sole shareholder of the Corporation
entitled to vote at a meeting of shareholders.

     DATED the 29th day of December, 1998.



                                       SUN MEDIA (TORONTO)
                                       CORPORATION



                                  Per: /s/ Bruce L. Jackson
                                       ----------------------
                                           Bruce L. Jackson

EX-3.11

                                                                    EXHIBIT 3.11

                                                               STATE OF DELAWARE
                                                              SECRETARY OF STATE
                                                        DIVISION OF CORPORATIONS
                                                       FILED 11:30 AM 11/26/1996
                                                             960346271 - 2688195


                          CERTIFICATE OF INCORPORATION
                                       OF
                         TORONTO SUN INTERNATIONAL, INC.


         The undersigned, in order to form a corporation for the purposes
hereinafter stated, under and pursuant to the General Corporation Law of the
State of Delaware, does hereby certify as follows:

         1. NAME. The name of the corporation is Toronto Sun International, Inc.
("Corporation").

         2. REGISTERED OFFICE AND REGISTERED AGENT. The address of the
Corporation's registered office in the State of Delaware is Corporation Trust
Center, 1209 Orange Street, City of Wilmington, County of New Castle, State of
Delaware, and the name of its registered agent at such address is The
Corporation Trust Company.

         3. PURPOSE. The purpose of the Corporation is to engage in any lawful
act or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.

         4. CAPITALIZATION. The Corporation shall be authorized to issue 1,000
shares of stock, all of which shall be common stock without par value ("Common
Stock").

         5. INCORPORATOR. The name and mailing address of the incorporator is:

         NAME                        ADDRESS

Richard M. Graf                      555 Twelfth Street, N.W.
                                     Washington, D.C. 20004

         6. COMPROMISE. Whenever a compromise or arrangement is proposed
between this Corporation and its creditors or any class of them and/or
between this Corporation and its stockholders or any class of them, any court
of equitable jurisdiction within the State of Delaware may, on the
application in a summary way of this Corporation or of any creditor or
stockholder thereof or on the application of any receiver or receivers
appointed for this Corporation under the provisions of Section 291 of Title 8
of the Delaware Code or on the application of trustees in dissolution or of
any receiver or receivers appointed for this



                                     - 2 -

Corporation under the provisions of Section 279 of Title 8 of
the Delaware Code order a meeting of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of this Corporation, as
the case may be, to be summoned in such manner as said court directs. If a
majority in number representing three-fourths in value of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of
this Corporation, as the case may be, agree to any compromise or arrangement
and to any reorganization of this Corporation as a consequence of such
compromise or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the said
application has been made, be binding on all the creditors or class of
creditors, and/or on all the stockholders or class of stockholders, of this
Corporation, as the case may be, and also on this Corporation.

         7. ELECTION. Elections of Directors need not be by written ballot.

         8. LIABILITY OF DIRECTORS. A Director of the Corporation shall, to the
maximum extent permitted by the laws of Delaware, have no personal liability to
the Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a Director.

         9. BYLAWS. The Board of Directors may from time-to-time (after adoption
by the undersigned of the original bylaws of the Corporation) make, alter or
repeal the bylaws of the Corporation; provided, that any bylaws made, amended or
repealed by the Board of Directors may be amended or repealed, and any bylaws
may be made, by the stockholders of the Corporation.

         I, THE UNDERSIGNED, being the incorporator hereinbefore named, for the
purpose of forming a corporation pursuant to the General Corporation Law of the
State of Delaware, do make this Certificate, hereby declaring and certifying
that this is my act and deed and that the facts herein stated are true, and
accordingly have hereunto set my hand this 26th day of November, 1996.



                                 /s/ RICHARD M. GRAF
                                 --------------------------------
                                 Richard M. Graf

EX-3.12

                                                                    EXHIBIT 3.12

                                    BYLAWS OF
                         TORONTO SUN INTERNATIONAL, INC.

ARTICLE I.    NAME. The name of the corporation is Toronto Sun International,
Inc. (the "Corporation").

ARTICLE II.   STOCKHOLDERS

     SECTION 1 - ANNUAL MEETING. The annual meeting of the stockholders shall be
held annually at a time and place to be set by the Board of Directors.

     SECTION 2 - SPECIAL MEETING. Special meetings of the stockholders, for any
purpose or purposes, unless otherwise prescribed by statute, may be called by
the Chairman, the President, the Secretary or the Board of Directors.

     SECTION 3 - NOTICE OF MEETING. Notice of meetings of stockholders shall be
given as required by applicable law.

     SECTION 4 - PLACE OF MEETING. Meetings of the stockholders shall be held at
the principal executive office of the Corporation or at such other place within
or without the State of Delaware as shall be specified or fixed in the notice of
such meetings or in the waiver of notice thereof.

     SECTION 5 - QUORUM. A majority in voting power of the outstanding shares of
the Corporation shall constitute a quorum.

ARTICLE III.  BOARD OF DIRECTORS

     SECTION 1 - GENERAL POWERS. Management and conduct of the affairs of the
Corporation shall be vested in and controlled by the Board of Directors.

     SECTION 2 - NUMBER. The Board of Directors shall consist of three members,
provided that the Board of Directors by resolution from time-to-time may
increase or decrease the number of Directors to any number not less than one,
and provided further that no reduction in the number of Directors shall have the
effect of shortening the term of any Director in office at the time such
resolution becomes effective.


                                     - 2 -


     SECTION 3 - QUALIFICATION. Directors shall be elected at the annual meeting
of stockholders and the term of office of each Director shall be until the next
annual meeting of stockholders and the election and qualification of his
successor. Members of the Board of Directors need not be residents of the State
of Delaware and need not be stockholders of the Corporation.

     SECTION 4 - TERMINATION OF OFFICE OF DIRECTOR; ELECTION OF SUCCESSOR OR NEW
DIRECTOR. The tenure of any Director of the Corporation shall automatically
terminate upon the effective date of his resignation submitted in writing to the
Board of Directors, upon his death or upon an affirmative vote by the Board of
Directors (in accordance with Section 5 of this Article III) to remove him from
office. Upon the termination of office of any Director as specified in the
preceding sentence, a successor to such Director shall be elected by vote of the
Board of Directors. Such successor shall, upon assuming office as a Director, be
subject to and governed by all the provisions of these Bylaws. In the event the
number of Directors is increased, the additional Directors shall be appointed by
the Board of Directors and, upon assuming office, shall be subject to and
governed by all the provisions of these Bylaws.

     SECTION 5 - DECISIONS BY BOARD OF DIRECTORS; QUORUM FOR MEETINGS. A
majority of the then members of the Board of Directors shall constitute a quorum
in order to permit the transaction of any business. In the absence of a quorum,
a majority of those Directors present may adjourn the meeting. The affirmative
vote of a majority of the Directors present at a Board of Directors' meeting at
which a quorum is present shall be necessary and sufficient to making of
decisions by the Board of Directors.

     Decisions made in accordance with the above provisions shall be the act of
the Board of Directors for any and all purposes.

     SECTION 6 - MEETINGS

     (a) IN GENERAL. Except as otherwise provided in these Bylaws, decisions of
the Board of Directors shall be made at duly constituted meetings. Regular
meetings may be held either within or without the State of Delaware, and shall
be held at such times and in such places as the Board of Directors may by
resolution determine in advance. Special meetings shall be convened at the
request of the Chairman of the Board of


                                     - 3 -


Directors, the President or any two members of the Board of Directors, and shall
be held at the time and place specified in such request. Nothing in these Bylaws
shall prohibit the Board of Directors from taking any action otherwise required
or permitted to be taken at a duly constituted meeting in any other manner
consistent with applicable law.

     (b) NOTICE. Notice of each special meeting of the Board shall, if mailed,
be addressed to each Director at the address designated by him for that purpose
or, if none is designated, at his last-known address at least three days before
the date on which the meeting is to be held; or such notice shall be sent to
each Director at such address by telegraph, cable, telecopy or telex, or be
delivered to him personally, not later than the day before the date on which
such meeting is to be held. Every such notice shall state the time and place of
the meeting but need not state the purposes of he meeting, except to the extent
required by law. If mailed, each notice shall be deemed given when deposited,
with postage thereon prepaid, in a post office or official depository under the
exclusive care and custody of the United States Postal Service. Such mailing
shall be by first-class mail. Whenever notice is required to be given any
Director under any provision of the General Corporation Law of the State of
Delaware or of the Corporation's Certificate of Incorporation or Bylaws, a
written waiver thereof, signed by the person entitled to notice, whether before
or after the time stated therein, shall be deemed equivalent to notice.
Attendance of a person at a meeting shall constitute a waiver of notice of such
meeting, except when the person attends a meeting for the express purpose of
objecting, at the beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
Directors need be specified in any written waiver of notice.

ARTICLE IV.   OFFICERS

     SECTION 1 - OFFICERS. The officers of the Corporation shall consist of a
Chairman, a President, a Treasurer and Secretary and such other officers and
assistant officers as the Board of Directors of the Corporation may from
time-to-time appoint, or authorize the President to appoint.


                                     - 4 -


     SECTION 2 - QUALIFICATIONS AND TENURE. Officers and assistant officers of
the Corporation may, but need not, also be members of the Board of Directors.
The tenure in office of any officer shall terminate by the same acts or events
which are specified as terminating the tenure of a Director. In addition,
however, any officer or assistant officer appointed by the President and, if the
President is so authorized by the Board of Directors of the Corporation, any
officer or assistant officer appointed by the Board of Directors of the
Corporation, may be removed from office by the President upon such terms as the
President may specify in writing to such officer. Should any vacancy occur among
the officers by reason of any of the specified acts or events, the position
shall be filled by appointment made by the Board of Directors of the Corporation
or by the President, if he is so authorized by the Board of Directors of the
Corporation.

     SECTION 3 - DUTIES. The powers and duties of the several officers shall be
as provided from time-to-time by resolution or other directive of the Board of
Directors. In the absence of such provisions, the respective officers shall have
the powers and shall discharge the duties customarily and usually held and
performed by like officers of a corporation similar in organization and business
purposes to the Corporation.

     SECTION 4 - PAYMENT. Officers may be paid such reasonable compensation, if
any, as the Board of Directors may from time-to-time authorize and direct.

ARTICLE V.    CONTRACT, LOANS, CHECKS, AND DEPOSITS

     SECTION 1 - CONTRACTS. The Board of Directors may authorize any officer,
employee or agent to enter into any contract or execute and deliver any
instrument in the name and on behalf of the Corporation. Such authority may be
general or confined to specific instances and if the Board of Directors so
provides may be delegated by the person so authorized.

     SECTION 2 - LOANS. No loans shall be contracted on behalf of the
Corporation and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the Board of Directors. Such authority may be
general or confined to specific instances and if the Board of Directors so
provides may be delegated by the person so authorized.


                                     - 5 -


     SECTION 3 - CHECKS, DRAFTS, OR ORDERS. All checks, drafts, or other orders
for the payment of money, notes, or other evidences of indebtedness issued in
the name of the Corporation shall be signed by such officers, employees or
agents of the Corporation and in such manner as shall from time-to-time be
determined by resolution of the Board of Directors.

     SECTION 4 - DEPOSITS. All funds of the Corporation not otherwise employed
shall be deposited from time-to-time to the credit of the Corporation in such
banks, trust companies, or other depositaries as the Board of Directors may
select, or as may be selected by an officer, employee or agent of the
Corporation to whom such power may from time-to-time be delegated by the Board
of Directors.

ARTICLE VI.   CERTIFICATES FOR SHARES, TRANSFERS

     SECTION 1 - CERTIFICATES FOR SHARES. Certificates representing shares of
the Corporation shall be in such form (consistent with applicable law) as shall
be determined by the Board of Directors. All certificates for shares shall be
consecutively numbered or otherwise identified. The name and address of the
person to whom the shares represented thereby are issued, with the number of
shares and date of issue, shall be entered on the stock transfer books of the
Corporation. All certificates surrendered to the Corporation for transfer shall
be cancelled and no new certificate shall be issued until the former certificate
for a like number of shares shall have been surrendered and cancelled, except
that in case of a lost, destroyed, or mutilated certificate a new one may be
issued therefor on such terms and indemnity to the Corporation as the Board of
Directors may prescribe.

     SECTION 2 - TRANSFER OF SHARES. Transfer of shares of the Corporation shall
be made in the manner specified in the Uniform Commercial Code. The Corporation
shall maintain stock transfer books, and any transfer shall be registered
thereon only on request and surrender of the stock certificate representing the
transferred shares, duly endorsed. The Corporation shall have the absolute right
to recognize as the owner of any shares of stock issued by it, the person or
persons in whose name the certificate representing such shares stands according
to the books of the Corporation for all proper corporate purposes, including the
voting of the shares represented by the certificate at a


                                     - 6 -


regular or special meeting of stockholders, and the issuance and payment of
dividends on such shares.

ARTICLE VII.  FISCAL YEAR

     The fiscal year of the Corporation shall be set by the Board of Directors.

ARTICLE VIII. DIVIDENDS

     The Board of Directors may from time-to-time declare, and the Corporation
may pay, dividends on its outstanding shares in the manner and on the terms and
conditions provided by law.

ARTICLE IX.   SEAL

     The Board of Directors shall provide a corporate seal, which shall be
circular in form and shall have inscribed thereon the name of the Corporation
and the state and year of incorporation and the words "Corporate Seal." The seal
shall be stamped or affixed to such documents as may be prescribed by law or
custom or by the Board of Directors.

ARTICLE X.    VOTING OF SHARES HELD

     Unless otherwise provided by resolution of the Board, the President may,
from time-to-time, appoint one or more attorneys or agents of the Corporation,
in the name and on behalf of the Corporation, to cast the votes which the
Corporation may be entitled to cast as a stockholder or otherwise in any other
corporation, any of whose shares or securities may be held by the Corporation,
at meetings of the holders of stock or other securities of such other
corporation, or to consent in writing to any action by any such other
corporation, and may instruct the person or persons so appointed as to the
manner of casting such votes or giving such consent, and may execute or cause to
be executed on behalf of the Corporation and under its corporate seal, or
otherwise, such written proxies, consents, waivers, or other instruments as he
may deem necessary or proper in the premises; or the President may himself
attend any meeting of the holders of the stock or other securities of any such
other corporation and thereat vote or exercise any or all other powers of


                                     - 7 -


the Corporation as the holder of such stock or other securities of such other
corporation.

ARTICLE XI.   INDEMNIFICATION

     Without limitation, the Corporation shall indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a director, officer,
employee, or agent of the Corporation, or is or was serving at the request of
the Corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding to the full extent permitted by the General
Corporation Law of Delaware, upon such determination having been made as to his
good faith and conduct as is required by said General Corporation Law. Expenses
incurred in defending a civil or criminal action, suit or proceeding shall be
paid by the Corporation in advance of the final disposition of such action, suit
or proceeding upon receipt of an undertaking by or on behalf of the director,
officer, employee or agent to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the Corporation.

ARTICLE XII.  AMENDMENTS

     The holders of a majority in voting power of the outstanding shares of the
Corporation or the Board of Directors shall have the power by majority vote to
alter, amend, repeal, or add to any of the Bylaws of the Corporation, and to
adopt new bylaws in the place of any provisions deleted.

EX-3.13

                                                                    EXHIBIT 3.13

                                                                           FILED
                                                              APRIL 15, 1988 9AM
                                                                     [ILLEGIBLE]
                                                              SECRETARY OF STATE

                          CERTIFICATE OF INCORPORATION

                                       OF

                                TS Printing, Inc.

     I, the undersigned, for the purpose of incorporating and organizing a
corporation under the General Corporation Law of the State of Delaware, do
hereby certify as follows:

     FIRST:  The name of the corporation (hereinafter called the "Corporation")
is TS Printing, Inc.

     SECOND:  The address of the Corporation's registered office in the State of
Delaware is 229 South State Street, City of Dover, County of Kent. The name of
the Corporation's registered agent at such address is The Prentice-Hall
Corporation System, Inc.

     THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware.

     FOURTH: (1) COMMON STOCK. The total number of shares of Common Stock which
the Corporation shall have authority to issue is one thousand (1,000), and all
such shares shall be of the par value of one cent ($0.01) per share.

     (a) IDENTICAL RIGHTS. All outstanding shares of Common Stock shall be
identical and shall entitle the holders thereof to the same powers, privileges
and rights and shall be subject to the same qualifications, limitations and
restrictions. The holders of Common Stock shall have no preemptive or
preferential rights of subscription to any shares of any class of capital stock
of the Corporation.

     (b) DIVIDENDS AND DISTRIBUTION. When and as dividends or distributions are
declared on outstanding shares of Common Stock, whether payable in cash, in
property or in securities of the Corporation (other than shares of Common
Stock), the holders of outstanding shares of Common Stock shall be entitled to
share equally, share for share, in such dividends and distributions.



                                     - 2 -


     (c) LIQUIDATION. Upon any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the holders of outstanding shares
of Common Stock shall be entitled to share equally, share for share, in the
assets of the Corporation to be distributed among the holders of shares of the
Common Stock.

     (d) VOTING RIGHTS. The holders of outstanding shares of Common stock shall
have the right to vote on all matters on which stockholders generally are
entitled to vote. On matters with respect to which the holders of outstanding
shares of Common Stock shall be entitled to vote, holders shall each be entitled
to one vote per share.

     (2) PREFERRED STOCK. The total number of shares of preferred stock which
the Corporation shall have authority to issue is one thousand (1,000), and all
such shares shall have a par value of one cent ($0.01) per share. The Board of
Directors shall establish by resolution the powers, privileges, preferences and
rights, and the qualifications, limitations or restrictions thereof, in respect
of any issue of preferred stock.

     FIFTH: The Corporation is to have perpetual existence.

     SIXTH: The name and mailing address of the incorporator is:

                         Caroline H. Little
                         1200 New Hampshire Avenue, N.W.
                         Washington, D.C. 20036

     SEVENTH: The Corporation shall, to the fullest extent permitted by Section
145 of the Delaware General Corporation Law, as amended from time to time,
indemnify all persons whom it may indemnify pursuant thereto.

     EIGHTH: Meetings of stockholders may be held within or without the State of
Delaware, as the By-Laws may provide. The books of the Corporation may be kept
(subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the By-Laws of the Corporation. Election of directors
need not be by written consent unless the By-Laws of the Corporation shall so
provide.



                                     - 3 -


     NINTH: Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for the Corporation under the provisions of Section 279 of Title 8 of the
Delaware Code, order a meeting of the creditors, or class of creditors, and/or
of the stockholders or class of stockholders of this Corporation, as the case
may be to be, summoned in such manner as the said court directs. If a majority
in number representing three-fourths in value of the creditors or class of
creditors and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of this Corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement, and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of this Corporation, as the case may be,
and also on this Corporation.

     TENTH: (1) Each person who was or is made a party or is threatened to be
made a party to or is otherwise involved in any action, suit or proceeding,
whether civil, criminal, administrative or investigation (hereinafter a
"proceeding"), by reason of the fact: (i) that he or she is or was a director or
officer of the Corporation, or (ii) that he or she, being at the time a director
or officer of the Corporation is or was serving at the request of the
Corporation as a director, trustee, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to an employee benefit plan (collectively,
"another enterprise"), whether either in case (i) or case (ii) the basis of such
proceeding is alleged action or inaction (a) in an official capacity as a
director or officer of the Corporation, or as a director, trustee, officer,
employee or agent of such other enterprise, or (b) in any other capacity related
to the Corporation or such other enterprise while so serving as a director,
trustee, officer, employee or agent, shall be



                                     - 4 -


indemnified and held harmless by the Corporation to the fullest extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Corporation to provide broader indemnification
rights than permitted prior thereto), against all expenses, liability and loss
(including without limitation attorneys' fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid in settlement) reasonably incurred or
suffered by such person in connection therewith. The persons indemnified by this
paragraph (1) of this Article TENTH are hereinafter referred to as
"indemnitees." Such indemnification as to such alleged action or inaction shall
continue as to an indemnitee who has after such alleged action or inaction
ceased to be a director or officer of the Corporation, or director, officer,
employee or agent of such other enterprise; and shall inure to the benefit of
the indemnitee's heirs, executors and administrators; PROVIDED, HOWEVER, that,
except as provided in paragraph (2) of this Article TENTH with respect to
proceedings to enforce rights to indemnification, the Corporation shall
indemnify any such indemnitee in connection with a proceeding (or portion
thereof) initiated by such indemnitee only if such proceeding (or portion
thereof) was authorized by the Board of Directors. The right to indemnification
conferred in this Article TENTH (a) shall be a contract right; (b) shall not be
affected adversely to any indemnitee by any amendment of this Certificate of
Incorporation with respect to any action or inaction occurring prior to such
amendment; and (c) shall include the right to be paid by the Corporation the
expenses incurred in defending any such proceeding in advance of its final
disposition (hereinafter an "advancement of expenses") PROVIDED, HOWEVER, that,
if and to the extent the Delaware General Corporation Law requires, an
advancement of expenses incurred by an indemnitee shall be made only upon
delivery to the Corporation of an undertaking (hereinafter an "undertaking"), by
or on behalf of such indemnitee, to repay all amounts so advanced if it shall
ultimately be determined by final judicial decision from which there is no
further right to appeal (hereinafter a "final adjudication") that such
indemnitee is not entitled to be indemnified for such expenses under this
Article TENTH or otherwise.

     (2) If a claim under paragraph (1) of this Article TENTH is not paid in
full by the Corporation within sixty days after it has been received in writing



                                     - 5 -


by the Corporation, except in the case of a claim for an advancement of
expenses, in which case the applicable period shall be twenty days, the
indemnitee may at any time thereafter bring suit against the Corporation to
recover the unpaid amount of the claim. If successful in whole or in part in any
such suit, or in a suit brought by the Corporation to recover an advancement of
expenses pursuant to the terms of an undertaking, the indemnitee shall be
entitled to be paid also the expenses of prosecuting or defending such suit. In
(i) any suit brought by the indemnitee to enforce a right to indemnification
hereunder (but not in a suit brought by the indemnitee to enforce a right to an
advancement of expenses) it shall be a defense that, and (ii) in any suit by the
Corporation to recover an advancement of expenses pursuant to the terms of an
undertaking the Corporation shall be entitled to recover such expenses only upon
a final adjudication that, the indemnitee has not met the applicable standard of
conduct set forth in the Delaware General Corporation Law. Neither the failure
of the Corporation (including the Board of Directors, independent legal counsel,
or its stockholders) to have made a determination prior to the commencement of
such suit that indemnification of the indemnitee is proper in the circumstances
because the indemnitee has met the applicable standard of conduct set forth in
the Delaware General Corporation Law, nor an actual determination by the
Corporation (including the Board of Directors, independent legal counsel, or its
stockholders) that the indemnitee has not met such applicable standard of
conduct, shall create a presumption that the indemnitee has not met the
applicable standard of conduct or, in the case of such a suit brought by the
indemnitee, be a defense to such suit. In any suit brought by the indemnitee to
enforce a right to indemnification or to an advancement of expenses hereunder,
or by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the burden of proving that the indemnitee is not
entitled to be indemnified, or to have or retain such advancement of expenses,
under this Article TENTH or otherwise, shall be on the Corporation.

     (3) The rights to indemnification and to the advancement of expenses
conferred in this Article TENTH shall not be exclusive of any other right which
any person may have or hereafter acquire under any statute, this Certificate of
Incorporation, the By-Laws, agreement, vote of stockholders or disinterested
directors or otherwise.


                                     - 6 -


     (4) The Corporation may maintain insurance, at its expense, to protect
itself and any director, trustee, officer, employee or agent of the Corporation
or another enterprise (as defined in paragraph (1) of this Article TENTH)
against any expense, liability or loss, whether or not the Corporation would
have the power to indemnify such person against such expense, liability or loss
under the Delaware General Corporation Law.

     (5) The Corporation may, to the extent authorized from time to time by the
Board of Directors, grant rights to indemnification, and to the advancement of
expenses, to any employee or agent of the Corporation (or any person serving at
the Corporation's request as a director, trustee, officer, employee, or agent of
another enterprise) or to persons who are or were a director, officer, employee
or agent of a constituent corporation absorbed by the Corporation in a
consolidation or merger or who is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
enterprise, in each case as determined by the Board, to the fullest extent of
the provisions of this Article TENTH in cases of the indemnification and
advancement of expenses of directors and officers of the Corporation, or to any
lesser extent (or greater extent, if permitted by law) determined by the Board
of Directors.

     ELEVENTH: The business and affairs of the Corporation shall be managed by
its Board of Directors, which may exercise all the powers of the Corporation and
do all such lawful acts and things that are not conferred upon or reserved to
the stockholders by law, by this Certificate of Incorporation or by the By-Laws
of the Corporation.

     TWELFTH: The private property of the stockholders of the Corporation shall
not be subject to the payment of corporate debts to any extent whatsoever.

     THIRTEENTH: Any action required to be taken at any annual or special
meeting of stockholders of the Corporation, or any action which may be taken at
any annual or special meeting of such stockholders, nay be taken without a
meeting and without a vote, upon not less than 10 days' prior notice to each
stockholder of record if consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such action



                                     - 7 -


at a meeting at which all shares entitled to vote thereon were present and
voted; PROVIDED, HOWEVER, that no such prior notice shall be required in the
case of any such consent signed by all of the holders of stock entitled to vote
on the matter.

     FOURTEENTH: A director of the Corporation shall, to the maximum extent
permitted by the laws of Delaware, have no personal liability to the Corporation
or its stockholders for monetary damages for breach of a fiduciary duty as a
director, provided that this Article FOURTEENTH shall not eliminate or reduce
the liability of a director in any case where such elimination or reduction is
not permitted by law.

     FIFTEENTH: The Board of Directors of the Corporation shall have power to
make, alter or amend By-Laws of the Corporation.

     SIXTEENTH: The Corporation reserves the right at any time and from time to
time to amend, alter, change or repeal any provision contained in this
Certificate of Incorporation, and other provisions authorized by the laws of the
State of Delaware at the time in force may be added or inserted, in the manner
now or hereafter prescribed by law; and all rights, preferences and privileges
or any other persons whomsoever by and pursuant to this Certificate of
Incorporation in its preset form or as hereafter amended are granted subject to
the right reserved in this Article.

     IN WITNESS WHEREOF, I, the undersigned, being the incorporator named, do
hereby execute this Certificate of Incorporation this 14th day of April, 1988.


                                                 /s/ CAROLINE H. LITTLE
                                        ----------------------------------------
                                                   Caroline H. Little




                                                                           FILED
                                                                 AUG 9, 1988 9AM
                                                                     [ILLEGIBLE]
                                                              SECRETARY OF STATE

                            CERTIFICATE OF AMENDMENT

                                       OF

                          CERTIFICATE OF INCORPORATION

                                       OF

                                TS PRINTING, Inc.

     TS Printing, Inc., a corporation organized and existing under and by virtue
or the General Corporation Law of the State of Delaware, does hereby certify:

     First: That the board of directors of said corporation, acting by written
consent in accordance with section 141(f) of the General Corporation Law of the
state of Delaware, adopted a resolution proposing and declaring advisable the
following amendment to the certificate of incorporation of said corporation:

          RESOLVED, that the certificate of incorporation of the corporation be
     amended by changing Section One, thereof so that, as amended, said Section
     One shall be and read as follows:

          FIRST: The name of the corporation (hereinafter called the
     "Corporation") is Comprint, Inc.

     Second: That in lieu of a meeting and vote of stockholders, the
stockholders have given written consent to said amendment in accordance with the
provisions of section 228 of the General Corporation Law of the state of
Delaware, and said written consent was filed with the corporation.

     Third: That the aforesaid amendment was duly adopted in accordance with the
applicable provisions of Sections 242 and 228 of title 8 of the Delaware Code of
1953.

     Fourth: That the capital of said corporation will not be reduced under or
by reason of said amendment.




                                     - 2 -


     In witness whereof, TS Printing, Inc. has caused this Certificate to be
signed by J. Douglas Creighton, its President and attested to by Trudy Eagan,
its Secretary, this 8th day of August 1988.

                                     By:       /s/ J. DOUGLAS CREIGHTON
                                        ----------------------------------------

        [SEAL]

Attest:    /s/ TRUDY EAGAN
       ------------------------




                                                           STATE OF DELAWARE
                                                          SECRETARY OF STATE
                                                       DIVISION OF CORPORATIONS
                                                       FILED 04:30 PM 06/28/1996
                                                          960192224 - 2157881


                                 COMPRINT, INC.

                            CERTIFICATE OF AMENDMENT
                                       OF
                          CERTIFICATE OF INCORPORATION

     COMPRINT, INC., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation"), DOES HEREBY
CERTIFY AS FOLLOWS:

FIRST:    The Board of Directors of the Corporation, by unanimous written
          consent, in accordance with Section 141(f) of the General Corporation
          Law of the State of Delaware, duly adopted a resolution in accordance
          with Section 242 of the General Corporation Law of the State of
          Delaware proposing an amendment of the Certificate of Incorporation of
          the Corporation. The resolution setting forth the amendment is as
          follows:

          RESOLVED:    That the Board of Directors hereby recommends to the
                       sole stockholder of the Corporation that Article First
                       of the Certificate of Incorporation of the Corporation
                       be amended so that it now shall read:

                       FIRST:    The name of the corporation (hereinafter
                                 called the "Corporation") is TS Printing, Inc.

SECOND:   The sole stockholder of the Corporation, by written consent, approved
          said amendment in accordance with Section 228 of the General
          Corporation Law of the State of Delaware.

THIRD:    The aforesaid amendment was duly adopted in accordance with the
          applicable provisions of Sections 242 and 228 of the General
          Corporation Law of the State of Delaware.

     IN WITNESS WHEREOF, the undersigned, COMPRINT, INC., has caused this
Certificate of Amendment of Certificate of Incorporation to be executed on its




behalf by its Chairman and attested by its Secretary as of this 13th day of
                                                                ----
March, 1996.

                                                    COMPRINT, INC,

                                     By:          /s/ PAUL V. GODFREY
                                        ----------------------------------------
                                        Paul V. Godfrey
                                        Chairman

Attest:    /s/ TRUDY EAGAN
       ------------------------
       Trudy A. Eagan
       Secretary

[SEAL]

EX-3.14

                                                                    EXHIBIT 3.14

                                     BY-LAWS

                                       OF

                                TS Printing, Inc.

                                   ARTICLE I

                                     Offices

         Section 1. REGISTERED OFFICE. The registered office of TS Printing,
Inc. (hereinafter called the "Corporation") shall be at 229 South State Street,
Dover, Delaware.

         Section 2. OTHER OFFICES. The Corporation also may have offices at such
other place or places as the Board of Directors may from time to time determine
or the business of the Corporation may require.

                                   ARTICLE II

                            Meetings of Stockholders

         Section 1. PLACE OF MEETING. All meetings of the stockholders of the
Corporation shall be held at such place, within or without the State of
Delaware, as may from time to time be fixed in the respective notices or waivers
of notices thereof.

         Section 2. ANNUAL MEETING. The annual meeting of the stockholders for
the election of directors and for the transaction of such other business as may
come before the meeting shall be held at such time and place



                                      - 2 -

as shall be determined by the President or the Board of Directors and stated in
the notice of the meeting. Written notice of the annual meeting stating the
place, date and hour of the meeting shall be given to each stockholder entitled
to vote at such meeting not less than ten (10) nor more than sixty (60) days
before the date of the meeting.

         Section 3. SPECIAL MEETINGS. Special meetings of the stockholders, for
any purpose or purposes, unless otherwise prescribed by statute or by the
Certificate of Incorporation, may be called by the President and shall be called
by the President or Secretary (i) at the request in writing of a majority of the
Board of Directors, or (ii) at the request in writing of stockholders owning a
majority in amount of the entire capital stock of the Corporation issued and
outstanding and entitled to vote. Such request shall state the purpose or
purposes of the proposed meeting. Written notice of a special meeting stating
the place, date and hour of the meeting and the purpose or purposes for which
the meeting is called shall be given not less than ten (10) nor more than sixty
(60) days before the date of the meeting to each stockholder entitled to vote at
such meeting. Business transacted at any special meeting of stockholders shall
be limited to the purposes stated in the notice.



                                     - 3 -

         Section 4. NOTICE NOT REQUIRED. Notice of any meeting of stockholders
shall not be required to be given to any stockholder who shall attend such
meeting in person or by proxy, and if any stockholder shall, in person or by
attorney thereunto authorized, in writing or by telegraph, cable or telex, waive
notice of any meeting, whether before or after such meeting shall be held,
notice thereof need not be given to him. Notice of any adjourned meeting of the
stockholders shall not be required to be given, except when expressly required
by law.

         Section 5. QUORUM. At each meeting of the stockholders, the holders of
a majority of each class of the issued and outstanding stock of the Corporation
entitled to vote at such meeting, present either in person or by proxy, shall
constitute a quorum for the transaction of business of the Corporation. In the
absence of a quorum, a majority present in person or by proxy and entitled to
vote, or, in the absence of all of the holders of each class of issued and
outstanding stock of the Corporation entitled to vote, any officer entitled to
preside or act as secretary at such meeting, shall have the power to adjourn the
meeting, from time to time, until the requisite number of stockholders of each
class shall be present or represented. At any such adjourned meeting at which a
quorum shall be present,



                                     - 4 -

any business may be transacted which might have been transacted at the meeting
as originally called.

         Section 6. VOTING. At each meeting of the stockholders, every
stockholder of record of the Corporation entitled to vote at such meeting shall
be entitled to one vote within his class or classes in person or by proxy
(executed in writing by the stockholder or by his duly authorized attorney in
fact) for each share in such class or classes of stock of the Corporation
registered in his name on the books of the Corporation on the date fixed
pursuant to Section 2 of Article VI of these By-Laws as the record date for the
determination of the stockholders entitled to vote at such meeting. Shares of
its own capital stock belonging to the Corporation shall not be voted upon
directly or indirectly. At all meetings of the stockholders, all matters (except
special cases where other provision is made in the Corporation's Certificate of
Incorporation, these By-Laws, any agreement between or among the Corporation's
stockholders or by statute) to be decided by each respective class of
stockholders shall be decided by the holders of a majority of the stock of each
class, respectively, present in person or by proxy and entitled to vote thereat,
a quorum being present. Unless demanded by a stockholder present in person or by



                                     - 5 -

proxy at any meeting and entitled to vote thereat, the vote on any question need
not be by ballot.

         Section 7. ACTION BY CONSENT. Whenever any action is required or
permitted to be taken by vote of stockholders of any class at a meeting thereof
by any provision of the statutes or of the Certificate of Incorporation or these
By-Laws or any agreement between or among the Corporation's stockholders, the
meeting and votes of stockholders of any class may be dispensed with if all the
stockholders of such class or classes who would have been entitled to vote upon
the action if such meeting were held shall consent in writing to such corporate
action being taken. Such written consent may be given by any person holding a
power of attorney for any stockholder.

                                  ARTICLE III

                               BOARD OF DIRECTORS

         Section 1. GENERAL POWERS. The business and affairs of the Corporation
shall be managed by the Board of Directors, which may exercise all such powers
of the Corporation and do all such lawful acts and things as are not by statute
or by the Certificate of Incorporation or these By-Laws or any agreement between
or among the Corporation's stockholders, directed or required to be exercised
and done by the stockholders.



                                     - 6 -

         Section 2. NUMBER AND TERM OF OFFICE. The number of directors which
shall constitute the whole Board may be as few as one (1) and may not be more
than four (4). Directors need not be stockholders. Each director shall hold
office until the annual meeting of the stockholders next following his election
or until his successor shall have been elected and shall qualify, or until his
death, or until he shall resign, or until he shall have been removed in the
manner herein provided.

         Section 3. QUORUM AND MANNER OF ACTING. Except as otherwise provided by
statute or by these By-Laws, a majority of the directors in office shall be
required to constitute a quorum for the transaction of business at any meeting,
and the act of a majority of the directors present at any meeting at which a
quorum is present shall be the act of the Board of Directors. In the absence of
a quorum, a majority of the directors present may adjourn any meeting from time
to time until a quorum shall be present. No notice other than announcement at
the meeting of any adjourned meeting need be given.

         Section 4. PLACE OF MEETINGS, ETC. The Board of Directors may hold its
meetings, have one or more offices, and keep the books and records of the
Corporation at such place or places within or without



                                     - 7 -

the State of Delaware as the Board from time to time may determine.

         Section 5. FIRST MEETING. The first meeting of each newly elected Board
of Directors shall be held at such time and place as shall be fixed by the vote
of the stockholders at the annual meeting, and no notice of such meeting shall
be necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present, or it may convene at such place and
time as shall be fixed by the consent in writing of all the directors.

         Section 6. REGULAR MEETINGS. Regular meetings of the Board of Directors
shall be held at such places and at such times as the Board shall from time to
time determine. If any day fixed for a regular meeting shall be a legal holiday
at the place where the meeting is to be held, then the meeting which otherwise
would be held on that day shall be held at said place at the same hour on the
next succeeding day not a legal holiday. Notice of regular meetings need not be
given.

         Section 7. SPECIAL MEETINGS; NOTICE. Special meetings of the Board of
Directors shall be held whenever called by the President or by a majority of the
directors. Notice of each such meeting shall be mailed to each director,
addressed to him at his residence or usual place of business, at least three (3)
days before



                                     - 8 -

the day on which the meeting is to be held, or shall be sent to him at such
place by telegraph, telex or cable, or be delivered personally by telephone, not
later than one day before the day upon which the meeting is to be held. Each
such notice shall state the time and place of the meeting but need not state the
purposes thereof except as otherwise herein expressly provided. Notice of any
meeting of the Board need not be given to any director, however, if waived by
him in writing or by telegraph, cable or wireless, whether before or after such
meeting shall be held, or if he shall be present at such meeting; and any
meeting of the Board shall be a legal meeting without any notice thereof having
been given, if all the directors of the Corporation then in office shall be
present thereat.

         Section 8. ACTION WITHOUT MEETING. Any action required or permitted to
be taken at a meeting of the Board of Directors may be taken without a meeting
if a consent in writing setting forth the action so taken shall be signed by all
of the members of the Board and filed with the minutes of proceedings of the
Board.

         Section 9. RESIGNATION. Any director of the Corporation may resign at
any time by giving written notice to the President or to the Secretary of the
Corporation. The resignation of any director shall take effect at the time
specified therein; and, unless



                                     - 9 -

otherwise specified therein, acceptance of such resignation shall not be
necessary to make it effective.

         Section 10. REMOVAL OF DIRECTORS. Any director may be removed, either
with or without cause, at any time, but such removal shall require the
affirmative vote of the holders of a majority of all of the shares of the class
of stock by whom he was elected, and the election of a director to fill the
unexpired portion of the term of any director so removed shall require a vote of
at least a majority of the outstanding shares of such class of stock of the
Corporation.

         Section 11. VACANCIES. Except as otherwise provided by statute or by
these By-Laws, any vacancy in the Board of Directors caused by death,
resignation, disqualification, or any other cause other than removal of
stockholders, may be filled either by a majority vote of the remaining
directors, though less than a quorum, or by the stockholders of the Corporation
entitled to vote by class thereon at the next annual meeting or at any special
meeting called for the purpose. A director elected to fill a vacancy shall be
elected for the unexpired term of his predecessor in office. Any directorship to
be filled by reason of an increase in a number of directors may be filled by
election at any annual meeting or at a special meeting of the class of
stockholders entitled to vote called for that purpose.



                                     - 10 -

         Section 12. COMPENSATION. Directors, as such, shall not receive any
stated salary for their services, but by resolution of the Board of Directors a
fixed sum and expenses of attendance, if any, may be allowed for attendance at
each regular and special meeting of the Board. Nothing herein contained shall be
construed so as to preclude any director from serving the Corporation in any
other capacity and receiving compensation therefor.

         Section 13. DIRECTORS' COMMITTEES. The Board of Directors may, by
resolution adopted by a majority of the directors, designate one or more
committees, each committee to consist of one or more of the directors of the
Corporation, which, to the extent provided in the resolution, shall have and may
exercise the powers of the Board of Directors in the management of the business
and affairs of the Corporation and may authorize the seal of the Corporation to
be affixed to all papers which may require it. Such a committee or committees
shall have such name or names as may be determined from time to time by
resolution adopted by the Board of Directors.



                                     - 11 -

                                   ARTICLE IV

                                    OFFICERS

         Section 1. NUMBER. The officers of the Corporation shall be a
President, a Secretary, a Chief Financial Officer and such other officers as may
be appointed by the Board of Directors.

         Section 2. ELECTION AND TERM OF OFFICE. The officers shall be elected
annually by the Board of Directors, and, except in the case of officers
appointed in accordance with the provisions of Section 7 of this Article, each
shall hold office until the next annual election of officers and until his
successor shall have been duly elected and qualified or until his death, or
until he shall resign by written notice to the Corporation, or until he shall
have been removed in the manner hereinafter provided. A vacancy in any office
because of death, resignation, removal or for any other cause shall be filled
for the unexpired portion of the term in the manner prescribed in these By-Laws
for election or appointment to such office.

         Section 3. REMOVAL. Any officer may be removed by the vote of the Board
of Directors at a regular or at a special meeting called for the purpose,
whenever in the judgment of the Board of Directors the best interests of the
Corporation will be served thereby, but



                                     - 12 -

such removal shall be without prejudice to the contract rights, if any, of the
person so removed.

         Section 4. PRESIDENT. The President shall have direct charge of the
management of the business operations of the Corporation, subject to general
control of the Board of Directors, and shall preside at all meetings of the
Board of Directors and at all meetings of the stockholders. He shall execute
bonds, mortgages, and other contracts requiring the seal of the Corporation,
except where required or permitted by law to be otherwise signed and executed
and except where the signing and execution thereof shall be expressly delegated
by the Board of Directors to some other officer or agent of the Corporation.

         Section 5. SECRETARY. The Secretary shall attend all meetings of the
Board of Directors and all meetings of the stockholders and record all the
proceedings of the meetings of the Corporation and of the Board of Directors in
a book to be kept for that purpose. He shall give, or cause to be given, notice
of all meetings of the stockholders and special meetings of the Board of
Directors, and shall perform such other duties as may be prescribed by the Board
of Directors or President, under whose supervision he shall be. He shall have
custody of the corporate seal of the Corporation and he shall have authority to
affix the



                                     - 13 -

same to any instrument requiring it and, when so affixed, it may be attested
by his signature. The Board of Directors may give general authority to any
other officer to affix the seal of the Corporation and to attest the affixing
by his signature.

         Section 6. CHIEF FINANCIAL OFFICER. If required by the Board of
Directors, the Chief Financial Officer shall give a bond for the faithful
discharge of his duties, in such sum and with such surety or sureties as the
Board of Directors shall determine. The Chief Financial Officer shall keep and
disburse the monies of the Corporation, as directed by the Board of Directors;
shall keep correct books of account; shall render to the President and to the
Board of Directors at the regular meetings thereof, or whenever requested by
them, reports of financial transactions by him and of the financial condition of
the Corporation; and, in general, shall perform all duties incident to the
office of Chief Financial Officer.

         Section 7. OTHER OFFICERS. The Corporation may have such other officers
and agents as may be deemed necessary by the Board of Directors, who shall be
appointed in such manner, have such duties, and hold their offices for such
terms as may be determined by resolution of the Board of Directors.



                                     - 14 -

         Section 8. SALARIES. The salaries of the officers shall be fixed from
time to time by the Board of Directors, and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
Corporation.

                                   ARTICLE V

                             CONTRACTS AND ACCOUNTS

         Section 1. CONTRACTS, CHECKS, NOTES, BANK ACCOUNTS, ETC. All contracts
and agreements authorized by the Board of Directors, and all checks, drafts,
notes, bonds, bills of exchange and orders for the payment of money, shall be
signed by the President, the Chief Financial Officer or such officer or officers
or employee or employees as the Board of Directors may from time to time
designate. The President, or any other officer or employee so authorized by the
Board of Directors, may enter into any contract or execute and deliver any
contract or other instrument in the name and on behalf of the Corporation, and
such authority may be general or confined to specific instances. Unless
authorized so to do by these By-Laws or by the Board of Directors, no officer,
agent or employee shall have any power or authority to bind the Corporation by
any contract or engagement, or to pledge its credit, or to



                                     - 15 -

render it liable pecuniarily for any purpose or in any amount.

         Section 2. DEPOSITS. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
as the Board of Directors, the President or the Chief Financial Officer shall
direct, in such banks, trust companies or other depositories as the Board of
Directors may select or as may be selected by any officer or officers or agent
or agents of the Corporation to whom power in that respect shall have been
delegated by the Board of Directors. For the purpose of deposit, and for the
purpose of collection for the account of the Corporation, checks, drafts and
other orders for the payment of money that are payable to the order of the
Corporation may be endorsed, assigned and delivered by any officer or agent of
the Corporation.

         Section 3. GENERAL AND SPECIAL BANK ACCOUNTS. The Board of Directors
may from time to time authorize the opening and keeping of general and special
bank accounts with such banks, trust companies or other depositories as the
Board of Directors may select, or as may be selected by any officer or officers,
agent or agents of the Corporation to whom power in that respect shall have been
delegated by the Board of Directors.



                                     - 16 -

The Board of Directors may make such special rules and regulations with respect
to such bank accounts, not inconsistent with the provisions of these By-Laws, as
it may deem expedient.

                                   ARTICLE VI

                                  CAPITAL STOCK

         Section 1. CERTIFICATES OF STOCK. Every stockholder shall be entitled
to have a certificate signed by, or in the name of the Corporation by, the
President and the Secretary of the Corporation, certifying the number of shares
of stock of the Corporation owned by him. The certificate shall be sealed with
the seal of the Corporation, or a facsimile thereof. No certificate shall be
issued for any share until such share is fully paid. Each certificate
representing shares shall state that the Corporation is organized under the laws
of the State of Delaware, the name of the person to whom issued, and the par
value of each share represented by such certificate or a statement that the
shares are without par value. Each stock certificate issued by or on behalf of
the Corporation shall have written, stamped, or printed on the face or back
thereof the words:

                  The shares represented by this
                  Certificate have not been registered
                  under the Securities Act of 1933, and



                                     - 17 -

                  such shares may not be sold or
                  transferred unless such sale or
                  transfer is in accordance with the
                  registration requirements of the
                  Securities Act of 1933, as at the time
                  amended, or unless some other exemption
                  from the registration requirements of
                  such Act is available with respect thereto.

         Such certificate shall be transferable on the stock books of the
Corporation in person or by attorney, but, except as hereinafter provided in the
case of loss, destruction or mutilation of certificates, no transfer of stock
shall be entered until the previous certificate, if any, given for the same
shall have been surrendered and canceled.

         Section 2. CLOSING OF TRANSFER BOOKS. For the purpose of determining
stockholders entitled to notice of or to vote at any meeting of stockholders, or
stockholders entitled to receive payment of any dividend, or in order to make a
determination of stockholders for any proper purpose, the Board of Directors may
provide that the stock transfer books shall be closed for a stated period but
not to exceed, in any case, sixty (60) days. If the stock transfer books shall
be closed for the purpose of determining stockholders entitled to notice of or
to vote at a meeting of stockholders, such books shall be closed for at least
ten (10) days immediately preceding such meeting. In lieu of closing the stock
transfer books,



                                     - 18 -

the Board of Directors may fix in advance a date as the record for any
determination of stockholders, such date in any case to be not more than sixty
(60) days, and in case of a meeting of stockholders not less than ten (10) days,
prior to the date upon which the particular action requiring such determination
of stockholders is to be taken. If the stock transfer books are not closed and
no record date is fixed for the determination of stockholders entitled to vote
at a meeting thereof or to receive payment of a dividend, the date on which
notice of the meeting is mailed or the date on which the resolution of the Board
of Directors declaring such dividends is adopted, as the case may be, shall be
the record date for such determination of stockholders.

         Section 3. LOST, DESTROYED OR MUTILATED CERTIFICATES. The Board of
Directors may direct a new certificate or certificates to be issued in place of
any certificate or certificates heretofore issued by the Corporation alleged to
have been lost, destroyed or mutilated upon the making of an affidavit of that
fact by the person claiming the certificates for shares to be lost or destroyed.
When authorizing such issuance of a new certificate or certificates, the Board
of Directors may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost or destroyed certificate or
certificates, or his legal



                                     - 19 -

representative, to advertise the same in such manner as it shall require, or to
give the Corporation a bond in such sums as it may direct, as indemnity against
any claim that may be made against the Corporation with respect to the
certificate alleged to have been lost or destroyed.

                                  ARTICLE VII

                                 INDEMNIFICATION

         Section 1. INDEMNIFICATION. (1) Each person who was or is made a party
or is threatened to be made a party to or is otherwise involved in any action,
suit or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact: (i) that he or she is or
was a director or officer of the Corporation, or (ii) that he or she, being at
the time a director or officer of the Corporation, is or was serving at the
request of the Corporation as a director, trustee, officer, employee or agent of
another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to an employee benefit plan
(collectively, "another enterprise"), whether either in case (i) or case (ii)
the basis of such proceeding is alleged action or inaction (a) in an official
capacity as a director or officer of the Corporation, or as a director, trustee,



                                     - 20 -

officer, employee or agent of such other enterprise, or (b) in any other
capacity related to the Corporation or such other enterprise while so serving as
a director, trustee, officer, employee or agent, shall be indemnified and held
harmless by the Corporation to the fullest extent authorized by the Delaware
General Corporation Law, as the same exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that such amendment permits
the Corporation to provide broader indemnification rights than permitted prior
thereto), against all expenses, liability and loss (including without limitation
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid in settlement) reasonably incurred or suffered by such person in connection
therewith. The persons indemnified by this paragraph (1) of this Article VII are
hereinafter referred to as "indemnitees." Such indemnification as to such
alleged action or inaction shall continue as to an indemnitee who has after such
alleged action or inaction ceased to be a director or officer of the
Corporation, or director, officer, employee or agent of such other enterprise;
and shall inure to the benefit of the indemnitee's heirs, executors and
administrators; PROVIDED, HOWEVER, that, except as provided in paragraph (2) of
this Article VII with respect to proceedings to



                                     - 21 -

enforce rights to indemnification, the Corporation shall indemnify any such
indemnitee in connection with a proceeding (or portion thereof) initiated by
such indemnitee only if such proceeding (or portion thereof) was authorized by
the Board of Directors. The right to indemnification conferred in this Article
VII (a) shall be a contract right; (b) shall not be affected adversely to any
indemnitee by any amendment of this Certificate of Incorporation with respect to
any action or inaction occurring prior to such amendment; and (c) shall include
the right to be paid by the Corporation the expenses incurred in defending any
such proceeding in advance of its final disposition (hereinafter an "advancement
of expenses"); PROVIDED, HOWEVER, that if and to the extent the Delaware General
Corporation Law requires, an advancement of expenses incurred by an indemnitee
shall be made only upon delivery to the Corporation of an undertaking
(hereinafter an "undertaking"), by or on behalf of such indemnitee, to repay all
amounts as advanced if it shall ultimately be determined by final judicial
decision from which there is no further right to appeal (hereinafter a "final
adjudication") that such indemnitee is not entitled to be indemnified for such
expenses under this Article VII or otherwise.

         (2) If a claim under paragraph (1) of this Article VII is not paid in
full by the Corporation



                                     - 22 -

within sixty days after it has been received in writing by the Corporation,
except in the case of a claim for an advancement of expenses, in which case the
applicable period shall be twenty days, the indemnitee may at any time
thereafter bring suit against the Corporation to recover the unpaid amount of
the claim. If successful in whole or in part in any such suit, or in a suit
brought by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the indemnitee shall be entitled to be paid also the
expense of prosecuting or defending such suit. In (i) any suit brought by the
indemnitee to enforce a right to indemnification hereunder (but not in a suit
brought by the indemnitee to enforce a right to an advancement of expenses) it
shall be a defense that, and (ii) in any suit by the Corporation to recover an
advancement of expenses pursuant to the terms of an undertaking the Corporation
shall be entitled to recover such expenses only upon a final adjudication that,
the indemnitee has not met the applicable standard of conduct set forth in the
Delaware General Corporation Law. Neither the failure of the Corporation
(including the Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such
suit that indemnification of the indemnitee is proper in the circumstances
because the



                                     - 23 -

indemnitee has met the applicable standard of conduct set forth in the Delaware
General Corporation Law, nor an actual determination by the Corporation
(including the Board of Directors, independent legal counsel, or its
stockholders) that the indemnitee has not met such applicable standard of
conduct, shall create a presumption that the indemnitee has not met the
applicable standard of conduct or, in the case of such a suit brought by the
indemnitee, be a defense to such suit. In any suit brought by the indemnitee to
enforce a right to indemnification or to an advancement of expenses hereunder,
or by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the burden of proving that the indemnitee is not
entitled to be indemnified, or to have or retain such advancement of expenses,
under this Article VII or otherwise, shall be on the Corporation.

         (3) The rights to indemnification and to the advancement of expenses
conferred in this Article VII shall not be exclusive of any other right which
any person may have or hereafter acquire under any statute, the Certificate of
Incorporation, these By-Laws, agreement, vote of stockholders or disinterested
directors or otherwise.

         (4) The Corporation may maintain insurance, at its expense, to protect
itself and any director,



                                     - 24 -

trustee, officer, employee or agent of the Corporation or another enterprise (as
defined in paragraph (1) of this Article VII) against any expense, liability or
loss, whether or not the Corporation would have the power to indemnify such
person against such expense, liability or loss under the Delaware General
Corporation Law.

         (5) The Corporation may, to the extent authorized from time to time by
the Board of Directors, grant rights to indemnification, and to the advancement
of expenses, to any employee or agent of the Corporation (or any person serving
at the Corporation's request as a director, trustee, officer, employee, or agent
of another enterprise) or to persons who are or were a director, officer,
employee or agent of a constituent corporation absorbed by the Corporation in a
consolidation or merger or who is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
enterprise, in each case as determined by the Board to the fullest extent of the
provisions of this Article VII in cases of the indemnification and advancement
of expenses of directors and officers of the Corporation, or to any lesser
extent (or greater extent, if permitted by law) determined by the Board of
Directors.



                                     - 25 -

                                  ARTICLE VIII

                                    DIVIDENDS

         Section 1. PAYMENT OF DIVIDENDS. The Board of Directors may declare and
the Corporation may pay dividends on its outstanding shares in cash, property,
or its shares pursuant to law and subject to the provisions of its Certificate
of Incorporation and By-Laws.

         Section 2. RESERVES. Before payment of any dividend, there may be set
aside out of any funds of the Corporation available for dividends such sum or
sums as the Board of Directors from time to time, in their absolute discretion,
deem proper as a reserve or reserves to meet contingencies, or for equalizing
dividends, or for preparing or maintaining any property of the Corporation, or
for such other purpose as the Board of Directors shall deem conducive to the
interest of the Corporation, and the Board of Directors may modify or abolish
any such reserve in the manner in which it was created.



                                     - 26 -

                                   ARTICLE IX

                                      SEAL

         The Board of Directors shall provide a corporate seal, which shall be
in form of a circle and shall have inscribed thereon the name of the
Corporation, the years of its organization and the state of incorporation. The
seal may be used by causing it or a facsimile thereof to be impressed or affixed
or reproduced or otherwise.

                                    ARTICLE X

                                   FISCAL YEAR

         The fiscal year of the Corporation shall be as determined by the Board
of Directors.

                                   ARTICLE XI

                                   AMENDMENTS

         These By-Laws, or any of them, may be altered, amended or repealed, or
new By-Laws may be made, at any meeting of the Board of Directors, by vote of a
majority of the Board of Directors, provided that the proposed action in respect
thereof shall be stated in the notice



                                     - 27 -

of waiver of notice of such meeting or that all of the directors of the
Corporation shall be present at such meeting.

EX-3.15

                                                                    EXHIBIT 3.15


                                                                           FILED
                                                               JUNE 23, 1989 9AM

                                                           [ILLEGIBLE SIGNATURE]
                                                              SECRETARY OF STATE


                          CERTIFICATE OF INCORPORATION

                                       OF

                           TS Printing (Florida), Inc.


     I, the undersigned, for the purpose of incorporating and organizing a
corporation under the General Corporation Law of the State of Delaware, do
hereby certify as follows:

     FIRST: The name of the corporation (hereinafter called the "Corporation")
is TS Printing (Florida), Inc.

     SECOND: The address of the Corporation's registered office in the State of
Delaware is 229 South State Street, City of Dover, County of Kent. The name of
the Corporation's registered agent at such address is The Prentice-Hall
Corporation System, Inc.

     THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of Delaware.

     FOURTH: (1) COMMON STOCK. The total number of shares of Common Stock which
the Corporation shall have authority to issue is one thousand (1,000), and all
such shares shall be of the par value of one cent ($0.01) per share.

     (a) IDENTICAL RIGHTS. All outstanding shares of Common Stock shall be
identical and shall entitle the holders thereof to the same powers, privileges
and rights and shall be subject to the same qualifications, limitations and
restrictions. The holders of Common Stock shall have no preemptive or
preferential rights of subscription to any shares of any class of capital stock
of the Corporation.

     (b) DIVIDENDS AND DISTRIBUTION. When and as dividends or distributions are
declared on outstanding shares of Common Stock, whether payable in cash, in
property or in securities of the Corporation (other than shares of Common
Stock), the holders of outstanding shares of Common Stock shall be entitled to
share equally, share for share, in such dividends and distributions.



                                      - 2 -


     (c) LIQUIDATION. Upon any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, the holders of outstanding shares
of Common Stock shall be entitled to share equally, share for share, in the
assets of the Corporation to be distributed among the holders of shares of the
Common Stock.

     (d) VOTING RIGHTS. The holders of outstanding shares of Common Stock shall
have the right to vote on all matters on which stockholders generally are
entitled to vote. On matters with respect to which the holders of outstanding
shares of Common Stock shall be entitled to vote, holders shall each be entitled
to one vote per share.

     (2) PREFERRED STOCK. The total number of shares of preferred stock which
the Corporation shall have authority to issue is one thousand (1,000), and all
such shares shall have a par value of one cent ($0.01) per share. The Board of
Directors shall establish by resolution the powers, privileges, preferences and
rights, and the qualifications, limitations or restrictions thereof, in respect
of any issue of preferred stock.

     FIFTH: The Corporation is to have perpetual existence.

     SIXTH: The name and mailing address of the incorporator is:

                         Margaret L. Jacobs
                         1200 New Hampshire Avenue, N.W.
                         Washington, D.C. 20036

     SEVENTH: The Corporation shall, to the fullest extent permitted by Section
145 of the Delaware General Corporation Law, as amended from time to time,
indemnify all persons whom it may indemnify pursuant thereto.

     EIGHTH: Meetings of stockholders may be held within or without the State of
Delaware, as the By-Laws may provide. The books of the Corporation may be kept
(subject to any provision contained in the statutes) outside the State of
Delaware at such place or places as may be designated from time to time by the
Board of Directors or in the By-Laws of the Corporation. Election of directors
need not be by written consent unless the By-Laws of the Corporation shall so
provide.



                                      - 3 -


     NINTH: Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them and/or between this
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for the Corporation under the provisions of Section 279 of Title 8 of the
Delaware Code, order a meeting of the creditors, or class of creditors, and/or
of the stockholders or class of stockholders of this Corporation, as the case
may be to be, summoned in such manner as the said court directs. If a majority
in number representing three-fourths in value of the creditors or class of
creditors and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of this Corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement, and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of this Corporation, as the case may be,
and also on this Corporation.

     TENTH: (1) Each person who was or is made a party or is threatened to be
made a party to or is otherwise involved in any action, suit or proceeding,
whether civil, criminal, administrative or investigation (hereinafter a
"proceeding"), by reason of the fact: (i) that he or she is or was a director or
officer of the Corporation, or (ii) that he or she, being at the time a director
or officer of the Corporation, is or was serving at the request of the
Corporation as a director, trustee, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to an employee benefit plan (collectively,
"another enterprise"), whether either in case (i) or case (ii) the basis of such
proceeding is alleged action or inaction (a) in an official capacity as a
director or officer of the Corporation, or as a director, trustee, officer,
employee or agent of such other enterprise, or (b) in any other capacity related
to the Corporation or such other enterprise while so serving as a director,



                                      - 4 -


trustee, officer, employee or agent, shall be indemnified and held harmless by
the Corporation to the fullest extent authorized by the Delaware General
Corporation Law, as the same exists or may hereafter be amended (but, in the
case of any such amendment, only to the extent that such amendment permits the
Corporation to provide broader indemnification rights than permitted prior
thereto), against all expenses, liability and loss (including without limitation
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid in settlement) reasonably incurred or suffered by such person in connection
therewith. The persons indemnified by this paragraph (1) of this Article TENTH
are hereinafter referred to as "indemnitees." Such indemnification as to such
alleged action or inaction shall continue as to an indemnitee who has after such
alleged action or inaction ceased to be a director or officer of the
Corporation, or director, officer, employee or agent of such other enterprise;
and shall inure to the benefit of the indemnitee's heirs, executors and
administrators; PROVIDED, HOWEVER, that, except as provided in paragraph (2) of
this Article TENTH with respect to proceedings to enforce rights to
indemnification, the Corporation shall indemnify any such indemnitee in
connection with a proceeding (or portion thereof) initiated by such indemnitee
only if such proceeding (or portion thereof) was authorized by the Board of
Directors. The right to indemnification conferred in this Article TENTH (a)
shall be a contract right; (b) shall not be affected adversely to any indemnitee
by any amendment of this Certificate of Incorporation with respect to any action
or inaction occurring prior to such amendment; and (c) shall include the right
to be paid by the Corporation the expenses incurred in defending any such
proceeding in advance of its final disposition (hereinafter an "advancement of
expenses") PROVIDED, HOWEVER, that, if and to the extent the Delaware General
Corporation Law requires, an advancement of expenses incurred by an indemnitee
shall be made only upon delivery to the Corporation of an undertaking
(hereinafter an "undertaking"), by or on behalf of such indemnitee, to repay all
amounts so advanced if it shall ultimately be determined by final judicial
decision from which there is no further right to appeal (hereinafter a "final
adjudication") that such indemnitee is not entitled to be indemnified for such
expenses under this Article TENTH or otherwise.

     (2) If a claim under paragraph (1) of this Article TENTH is not paid in
full by the Corporation



                                      - 5 -


within sixty days after it has been received in writing by the Corporation,
except in the case of a claim for an advancement of expenses, in which case the
applicable period shall be twenty days, the indemnitee may at any time
thereafter bring suit against the Corporation to recover the unpaid amount of
the claim. If successful in whole or in part in any such suit, or in a suit
brought by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the indemnitee shall be entitled to be paid also the
expenses of prosecuting or defending such suit. In (i) any suit brought by the
indemnitee to enforce a right to indemnification hereunder (but not in a suit
brought by the indemnitee to enforce a right to an advancement of expenses) it
shall be a defense that, and (ii) in any suit by the corporation to recover an
advancement of expenses pursuant to the terms of an undertaking the Corporation
shall be entitled to recover such expenses only upon a final adjudication that,
the indemnitee has not met the applicable standard of conduct set forth in the
Delaware General Corporation Law. Neither the failure of the Corporation
(including the Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such
suit that indemnification of the indemnitee is proper in the circumstances
because the indemnitee has met the applicable standard of conduct set forth in
the Delaware General Corporation Law, nor an actual determination by the
Corporation (including the Board of Directors, independent legal counsel, or its
stockholders) that the indemnitee has not met such applicable standard of
conduct, shall create a presumption that the indemnitee has not met the
applicable standard of conduct or, in the case of such a suit brought by the
indemnitee, be a defense to such suit. In any suit brought by the indemnitee to
enforce a right to indemnification or to an advancement of expenses hereunder,
or by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the burden of proving that the indemnitee is not
entitled to be indemnified, or to have or retain such advancement of expenses,
under this Article TENTH or otherwise, shall be on the Corporation.

     (3) The rights to indemnification and to the advancement of expenses
conferred in this Article TENTH shall not be exclusive of any other right which
any person may have or hereafter acquire under any statute, this Certificate of
Incorporation, the By-Laws, agreement, vote of stockholders or disinterested
directors or otherwise.



                                      - 6 -


     (4) The Corporation may maintain insurance, at its expense, to protect
itself and any director, trustee, officer, employee or agent of the Corporation
or another enterprise (as defined in paragraph (1) of this Article TENTH)
against any expense, liability or loss, whether or not the Corporation would
have the power to indemnify such person against such expense, liability or loss
under the Delaware General Corporation Law.

     (5) The Corporation may, to the extent authorized from time to time by the
Board of Directors, grant rights to indemnification, and to the advancement of
expenses, to any employee or agent of the Corporation (or any person serving at
the Corporation's request as a director, trustee, officer, employee, or agent of
another enterprise) or to persons who are or were a director, officer, employee
or agent of a constituent corporation absorbed by the Corporation in a
consolidation or merger or who is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
enterprise, in each case as determined by the Board, to the fullest extent of
the provisions of this Article TENTH in cases of the indemnification and
advancement of expenses of directors and officers of the Corporation, or to any
lesser extent (or greater extent, if permitted by law) determined by the Board
of Directors.

     ELEVENTH: The business and affairs of the Corporation shall be managed by
its Board of Directors, which may exercise all the powers of the Corporation and
do all such lawful acts and things that are not conferred upon or reserved to
the stockholders by law, by this Certificate of Incorporation or by the By-Laws
of the Corporation.

     TWELFTH: The private property of the stockholders of the Corporation shall
not be subject to the payment of corporate debts to any extent whatsoever.

     THIRTEENTH: Any action required to be taken at any annual or special
meeting of stockholders of the Corporation, or any action which may be taken at
any annual or special meeting of such stockholders, may be taken without a
meeting and without a vote, upon not less than 10 days' prior notice to each
stockholder of record if consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes


                                      - 7 -


that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted; PROVIDED, HOWEVER,
that no such prior notice shall be required in the case of any such consent
signed by all of the holders of stock entitled to vote on the matter.

     FOURTEENTH: A director of the Corporation shall, to the maximum extent
permitted by the laws of Delaware, have no personal liability to the Corporation
or its stockholders for monetary damages for breach of a fiduciary duty as a
director, provided that this Article FOURTEENTH shall not eliminate or reduce
the liability of a director in any case where such elimination or reduction is
not permitted by law.

     FIFTEENTH: The Board of Directors of the Corporation shall have power to
make, alter or amend By-Laws of the Corporation.

     SIXTEENTH: The Corporation reserves the right at any time and from time to
time to amend, alter, change or repeal any provision contained in this
Certificate of Incorporation, and other provisions authorized by the laws of the
State of Delaware at the time in force may be added or inserted, in the manner
now or hereafter prescribed by law; and all rights, preferences and privileges
or any other persons whomsoever by and pursuant to this Certificate of
Incorporation in its present form or as hereafter amended are granted subject to
the right reserved in this Article.

     IN WITNESS WHEREOF, I, the undersigned, being the incorporator named, do
hereby execute this Certificate of Incorporation this 22nd day of June, 1989.


                                                  /s/ MARGARET L. JACOBS
                                         ---------------------------------------
                                                    Margaret L. Jacobs




                                                                           FILED
                                                            OCTOBER 27, 1989 9AM

                                                           [ILLEGIBLE SIGNATURE]
                                                              SECRETARY OF STATE


                   CERTIFICATE OF AMENDMENT OF CERTIFICATE OF

                                INCORPORATION OF

                           TS PRINTING (Florida), Inc.


     It is hereby certified that:

     1. The name of the corporation (hereinafter called the "Corporation") is:
TS Printing (Florida), Inc.

     2. The certificate of incorporation of the Corporation is hereby amended by
striking out Article One thereof so that, as amended, said Article One shall be
and read in the entirety as follows:

"FIRST: The name of the corporation (hereinafter called the "Corporation") is
TS Publications, Inc."

     3. The amendment of the certificate of incorporation herein certified has
been duly adopted in accordance with the provisions of section 228 and 242 of
the General Corporation Law of the State of Delaware.




                                     - 2 -

     Signed and attested to on October 20, 1989.


                                                 /s/ J. DOUGLAS CREIGHTON
                                         ---------------------------------------
                                         J. Douglas Creighton
                                         President

Attest:

     /s/ WILLIAM R. DEMPSEY
- -------------------------------
William R. Dempsey
Secretary



    STATE OF DELAWARE
    SECRETARY OF STATE
 DIVISION OF CORPORATIONS
FILED 09:00 AM 11/16/1992
   9232 15528 - 2200291

                            CERTIFICATE OF AMENDMENT
                                       OF
                          CERTIFICATE OF INCORPORATION
                                       OF
                              TS PUBLICATIONS, INC.

     TS Publications, Inc., a corporation organized and existing under and by
virtue or the General Corporation Law of the State of Delaware (the
"Corporation"), DOES HEREBY CERTIFY:

     FIRST: That pursuant to a unanimous written consent of the Corporation's
Board of Directors dated October 30, 1992, a resolution was adopted setting
forth a proposed amendment to the Certificate of Incorporation of the
Corporation, declaring said amendment to be advisable and proposed to submit
said amendment to the stockholder of the Corporation for consideration thereof.
Such resolution read as follows:

     RESOLVED, that the Board of Directors of the Corporation does hereby
     declare it advisable and in the best interests of the Corporation and its
     stockholder that the Corporation amend its Certificate of Incorporation to
     change its name so that Article FIRST of the Certificate of Incorporation
     be amended to read as follows:

     "FIRST: The name of the corporation (hereinafter called the "Corporation")
     is: Florida Sun Publications, Inc."

     SECOND: That the said amendment has been consented to and authorized by the
holders of a majority of the issued and outstanding stock entitled to vote by
written consent given in accordance with the provisions of Section 228 of the
General Corporation Law of the State of Delaware.

     THIRD: That the aforesaid amendment was duly adopted in accordance with the
applicable provisions of Section 242 and 228 of the General Corporation Law of
the State of Delaware.

     IN WITNESS WHEREOF, said corporation has caused this Certificate to be
signed by Mario Sgroi, its President, and attested by William R. Dempsey, its
Secretary, this 30th day of October, 1992.

                                                    /s/ MARIO SGROI
                                        ----------------------------------------
                                        President

                            Attested by:         /s/ WILLIAM R. DEMPSEY
                                        ----------------------------------------
                                        Secretary

EX-3.16

                                                                    EXHIBIT 3.16

                                     BY-LAWS

                                       OF

                           TS PRINTING (FLORIDA), INC.

                              A Delaware Corporation

                                    ARTICLE I.

                                     OFFICES

     Section 1. REGISTERED OFFICE. The registered office of TS Printing
(Florida), Inc. (hereinafter called the "Corporation") within the State of
Delaware shall be at 229 South State Street, Dover, Delaware.

     Section 2. OTHER OFFICES. The Corporation may also have offices at such
other place or places as the Board of Directors shall from time to time
determine or the business of the Corporation may require.


                                   ARTICLE II.

                            MEETINGS OF STOCKHOLDERS

     Section 1. PLACE OF MEETING. All meetings of the stockholders shall be held
at any such place, either within or without the State of Delaware, as shall be
designated from time to time by the Board of Directors and stated in the notice
of meeting or in a duly executed waiver thereof.

     Section 2. ANNUAL MEETING. The annual meeting of the stockholders for the
election of directors and for the transaction of such other business as may come



                                     - 2 -


before the meeting shall be held at such time and place as shall be determined
by the President or the Board of Directors and stated in the notice of the
meeting. Written notice of the annual meeting stating the place, date and hour
of the meeting shall be given to each stockholder entitled to vote at such
meeting not less than ten (10) nor more than sixty (60) days before the date of
the meeting.

     Section 3. SPECIAL MEETINGS. Special meetings of the stockholders, for any
purpose or purposes, unless otherwise prescribed by statute or by the
Certificate of Incorporation, may be called by the President and shall be called
by the President or Secretary (i) at the request in writing of a majority of the
Board of Directors, or (ii) at the request in writing of stockholders owning a
majority in amount of the entire capital stock of the Corporation issued and
outstanding and entitled to vote. Such request shall state the purpose or
purposes of the proposed meeting. Written notice of a special meeting stating
the place, date and hour of the meeting and the purpose or purposes for which
the meeting is called shall be given not less than ten (10) nor more than sixty
(60) days before the date of the meeting to each stockholder entitled to vote at
such meeting. Business transacted at any special



                                     - 3 -


meeting of stockholders shall be limited to the purposes stated in the notice.

     Section 4. NOTICE NOT REQUIRED. Notice of any meeting of stockholders shall
not be required to be given to any stockholder who shall attend such meeting in
person or by proxy, and if any stockholder shall, in person or by attorney
thereunto authorized, in writing or by telegraph, cable or telex, waive notice
of any meeting, whether before or after such meeting shall be held, notice
thereof need not be given to him. Notice of any adjourned meeting of the
stockholders shall not be required to be given, except when expressly required
by law.

     Section 5. QUORUM. At each meeting of the stockholders, the holders of a
majority of each class of the issued and outstanding stock of the Corporation
entitled to vote at such meeting, present either in person or by proxy, shall
constitute a quorum for the transaction of business of the Corporation. In the
absence of a quorum, a majority present in person or by proxy and entitled to
vote, or, in the absence of all of the holders of each class of issued and
outstanding stock of the Corporation entitled to vote, any officer entitled to
preside or act as secretary at such meeting, shall have the power to adjourn the
meeting, from time to time, until the requisite number of stockholders of



                                     - 4 -


each class shall be present or represented. At any such adjourned meeting at
which a quorum shall be present, any business may be transacted which might have
been transacted at the meeting as originally called.

     Section 6. VOTING. At each meeting of the stockholders, every stockholder
of record of the Corporation entitled to vote at such meeting shall be entitled
to one vote within his class or classes in person or by proxy (executed in
writing by the stockholder or by his duly authorized attorney in fact) for each
share in such class or classes of stock of the Corporation registered in his
name on the books of the Corporation on the date fixed pursuant to Section 2 of
Article VI of these By-Laws as the record date for the determination of the
stockholders entitled to vote at such meeting. Shares of its own capital stock
belonging to the Corporation shall not be voted upon directly or indirectly. At
all meetings of the stockholders, all matters (except special cases where other
provision is made in the Corporation's Certificate of Incorporation, these
By-Laws, any agreement between or among the Corporation's stockholders or by
statute) to be decided by each respective class of stockholders shall be decided
by the holders of a majority of the stock of each class, respectively, present
in person or by proxy and entitled to vote thereat, a quorum being



                                     - 5 -


present. Unless demanded by a stockholder present in person or by proxy at any
meeting and entitled to vote thereat, the vote on any question need not be by
ballot.

     Section 7. ACTION BY CONSENT. Whenever any action is required or permitted
to be taken by vote of stockholders of any class at a meeting thereof by any
provision of the statutes or of the Certificate of Incorporation or these
By-Laws or any agreement between or among the Corporation's stockholders, the
meeting and votes of stockholders of any class may be dispensed with if all the
stockholders of such class or classes who would have been entitled to vote upon
the action if such meeting were held shall consent in writing to such corporate
action being taken. Such written consent may be given by any person holding a
power of attorney for any stockholder.


                                  ARTICLE III.

                               BOARD OF DIRECTORS

     Section 1. GENERAL POWERS. The business and affairs of the Corporation
shall be managed by the Board of Directors, which may exercise all such powers
of the Corporation and do all such lawful acts and things as are not by statute
or by the Certificate of Incorporation or these By-Laws or any agreement between



                                     - 6 -


or among the Corporation's stockholders, directed or required to be exercised
and done by the stockholders.

     Section 2. NUMBER AND TERM OF OFFICE. The number of directors which shall
constitute the whole Board may be as few as one (1) and may not be more than
four (4). Directors need not be stockholders. Each director shall hold office
until the annual meeting of the stockholders next following his election or
until his successor shall have been elected and shall qualify, or until his
death, or until he shall resign, or until he shall have been removed in the
manner herein provided.

     Section 3. QUORUM AND MANNER OF ACTING. Except as otherwise provided by
statute or by these By-Laws, a majority of the directors in office shall be
required to constitute a quorum for the transaction of business at any meeting,
and the act of a majority of the directors present at any meeting at which a
quorum is present shall be the act of the Board of Directors. In the absence of
a quorum, a majority of the directors present may adjourn any meeting from time
to time until a quorum shall be present. No notice other than announcement at
the meeting of any adjourned meeting need be given.

     Section 4. PLACE OF MEETINGS, ETC. The Board of Directors may hold its
meetings, have one or more offices, and keep the books and records of the



                                     - 7 -


Corporation at such place or places within or without the State of Delaware as
the Board from time to time may determine.

     Section 5. FIRST MEETING. The first meeting of each newly elected Board of
Directors shall be held at such time and place as shall be fixed by the vote of
the stockholders at the annual meeting, and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present, or it may convene at such place and
time as shall be fixed by the consent in writing of all the directors.

     Section 6. REGULAR MEETINGS. Regular meetings of the Board of Directors
shall be held at such places and at such times as the Board shall from time to
time determine. If any day fixed for a regular meeting shall be a legal holiday
at the place where the meeting is to be held, then the meeting which otherwise
would be held on that day shall be held at said place at the same hour on the
next succeeding day not a legal holiday. Notice of regular meetings need not be
given.

     Section 7. SPECIAL MEETINGS; NOTICE. Special meetings of the Board of
Directors shall be held whenever called by the President or by a majority of the
directors. Notice of each such meeting shall be mailed to each director,
addressed to him at his residence or



                                     - 8 -


usual place of business, at least three (3) days before the day on which the
meeting is to be held, or shall be sent to him at such place by telegraph,
telex or cable, or be delivered personally by telephone, not later than one
day before the day upon which the meeting is to be held. Each such notice
shall state the time and place of the meeting but need not state the purposes
thereof except as otherwise herein expressly provided. Notice of any meeting
of the Board need not be given to any director, however, if waived by him in
writing or by telegraph, cable or wireless, whether before or after such
meeting shall be held, or if he shall be present at such meeting; and any
meeting of the Board shall be a legal meeting without any notice thereof
having been given, if all the directors of the Corporation then in office
shall be present thereat.

     Section 8. ACTION WITHOUT MEETING. Any action required or permitted to be
taken at a meeting of the Board of Directors may be taken without a meeting if a
consent in writing setting forth the action so taken shall be signed by all of
the members of the Board and filed with the minutes of proceedings of the Board.

     Section 9. RESIGNATION. Any director of the Corporation may resign at any
time by giving written notice to the President or to the Secretary of the
Corporation. The resignation of any director shall take



                                     - 9 -


effect at the time specified therein; and, unless otherwise specified therein,
acceptance of such resignation shall not be necessary to make it effective.

     Section 10. REMOVAL OF DIRECTORS. Any director may be removed, either with
or without cause, at any time, but such removal shall require the affirmative
vote of the holders of a majority of all of the shares of the class of stock by
whom he was elected, and the election of a director to fill the unexpired
portion of the term of any director so removed shall require a vote of at least
a majority of the outstanding shares of such class of stock of the Corporation.

     Section 11. VACANCIES. Except as otherwise provided by statute or by these
By-Laws, any vacancy in the Board of Directors caused by death, resignation,
disqualification, or any other cause other than removal of stockholders, may be
filled either by a majority vote of the remaining directors, though less than a
quorum, or by the stockholders of the Corporation entitled to vote by class
thereon at the next annual meeting or at any special meeting called for the
purpose. A director elected to fill a vacancy shall be elected for the unexpired
term of his predecessor in office. Any directorship to be filled by reason of an
increase in a number of directors may be filled by election at any



                                     - 10 -


annual meeting or at a special meeting of the class of stockholders entitled to
vote called for that purpose.

     Section 12. COMPENSATION. Directors, as such, shall not receive any stated
salary for their services, but by resolution of the Board of Directors a fixed
sum and expenses of attendance, if any, may be allowed for attendance at each
regular and special meeting of the Board. Nothing herein contained shall be
construed so as to preclude any director from serving the Corporation in any
other capacity and receiving compensation therefor.

     Section 13. DIRECTORS' COMMITTEES. The Board of Directors may, by
resolution adopted by a majority of the directors, designate one or more
committees, each committee to consist of one or more of the directors of the
Corporation, which, to the extent provided in the resolution, shall have and may
exercise the powers of the Board of Directors in the management of the business
and affairs of the Corporation and may authorize the seal of the Corporation to
be affixed to all papers which may require it. Such a committee or committees
shall have such name or names as may be determined from time to time by
resolution adopted by the Board of Directors.



                                     - 11 -


                                   ARTICLE IV.

                                    OFFICERS

     Section 1. NUMBER. The officers of the Corporation shall be a President, a
Secretary and such other officers as may be appointed by the Board of Directors.

     Section 2. ELECTION AND TERM OF OFFICE. The officers shall be elected
annually by the Board of Directors, and, except in the case of officers
appointed in accordance with the provisions of Section 7 of this Article, each
shall hold office until the next annual election of officers and until his
successor shall have been duly elected and qualified or until his death, or
until he shall resign by written notice to the Corporation, or until he shall
have been removed in the manner hereinafter provided. A vacancy in any office
because of death, resignation, removal or for any other cause shall be filled
for the unexpired portion of the term in the manner prescribed in these By-Laws
for election or appointment to such office.

     Section 3. REMOVAL. Any officer may be removed by the vote of the Board of
Directors at a regular or at a special meeting called for the purpose, whenever
in the judgment of the Board of Directors the best interests of the Corporation
will be served thereby, but



                                     - 12 -


such removal shall be without prejudice to the contract rights, if any, of the
person so removed.

     Section 4. PRESIDENT. The President shall have direct charge of the
management of the business operations of the Corporation, subject to general
control of the Board of Directors, and shall preside at all meetings of the
Board of Directors and at all meetings of the stockholders. He shall execute
bonds, mortgages, and other contracts requiring the seal of the Corporation,
except where required or permitted by law to be otherwise signed and executed
and except where the signing and execution thereof shall be expressly delegated
by the Board of Directors to some other officer or agent of the Corporation.

     Section 5. SECRETARY. The Secretary shall attend all meetings of the Board
of Directors and all meetings of the stockholders and record all the proceedings
of the meetings of the Corporation and of the Board of Directors in a book to be
kept for that purpose. He shall give, or cause to be given, notice of all
meetings of the stockholders and special meetings of the Board of Directors, and
shall perform such other duties as may be prescribed by the Board of Directors
or President, under whose supervision he shall be. He shall have custody of the
corporate seal of the Corporation and he shall have authority to affix the



                                     - 13 -


same to any instrument requiring it and, when so affixed, it may be attested by
his signature. The Board of Directors may give general authority to any other
officer to affix the seal of the Corporation and to attest the affixing by his
signature.

     Section 6. OTHER OFFICERS. The Corporation may have such other officers and
agents as may be deemed necessary by the Board of Directors, who shall be
appointed in such manner, have such duties, and hold their offices for such
terms as may be determined by resolution of the Board of Directors.

     Section 7. SALARIES. The salaries of the officers shall be fixed from time
to time by the Board of Directors, and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
Corporation.


                                   ARTICLE V.

                             CONTRACTS AND ACCOUNTS

     Section 1. CONTRACTS, CHECKS, NOTES, BANK ACCOUNTS, ETC. All contracts and
agreements authorized by the Board of Directors, and all checks, drafts, notes,
bonds, bills of exchange and orders for the payment of money, shall be signed by
the President or such officer or officers or employee or employees as the Board
of Directors may from time to time designate. The



                                     - 14 -


President, or any other officer or employee so authorized by the Board of
Directors, may enter into any contract or execute and deliver any contract or
other instrument in the name and on behalf of the Corporation, and such
authority may be general or confined to specific instances. Unless authorized so
to do by these By-Laws or by the Board of Directors, no officer, agent or
employee shall have any power or authority to bind the Corporation by any
contract or engagement, or to pledge its credit, or to render it liable
pecuniarily for any purpose or in any amount.

     Section 2. DEPOSITS. All funds of the Corporation not otherwise employed
shall be deposited from time to time to the credit of the Corporation as the
Board of Directors, the President or such officer or officers or employee or
employees as the Board of Directors may from time to time designate shall
direct, in such banks, trust companies or other depositories as the Board of
Directors may select or as may be selected by any officer or officers or agent
or agents of the Corporation to whom power in that respect shall have been
delegated by the Board of Directors. For the purpose of deposit, and for the
purpose of collection for the account of the Corporation, checks, drafts and
other orders for the payment of money that are payable to the order of the
Corporation may be endorsed,



                                     - 15 -


assigned and delivered by any officer or agent of the Corporation.

     Section 3. GENERAL AND SPECIAL BANK ACCOUNTS. The Board of Directors may
from time to time authorize the opening and keeping of general and special bank
accounts with such banks, trust companies or other depositories as the Board of
Directors may select, or as may be selected by any officer or officers, agent or
agents of the Corporation to whom power in that respect shall have been
delegated by the Board of Directors. The Board of Directors may make such
special rules and regulations with respect to such bank accounts, not
inconsistent with the provisions of these By-Laws, as it may deem expedient.


                                  ARTICLE VI.

                                  CAPITAL STOCK

     Section 1. CERTIFICATES OF STOCK. Every stockholder shall be entitled to
have a certificate signed by, or in the name of the Corporation by, the
President and the Secretary of the Corporation, certifying the number of shares
of stock of the Corporation owned by him. The certificate shall be sealed with
the seal of the Corporation, or a facsimile thereof. No certificate shall be
issued for any share until such share is fully paid. Each certificate




                                     - 16 -


representing shares shall state that the Corporation is organized under the laws
of the State of Delaware, the name of the person to whom issued, and the par
value of each share represented by such certificate or a statement that the
shares are without par value. Each stock certificate issued by or on behalf of
the Corporation shall have written, stamped, or printed on the face or back
thereof the words:

     The shares represented by this Certificate have not been registered under
     the Securities Act of 1933, and such shares may not be sold or transferred
     unless such sale or transfer is in accordance with the registration
     requirements of the Securities Act of 1933, as at the time amended, or
     unless some other exemption from the registration requirements of such Act
     is available with respect thereto.

Such certificate shall be transferable on the stock books of the Corporation in
person or by attorney, but, except as hereinafter provided in the case of loss,
destruction or mutilation of certificates, no transfer of stock shall be entered
until the previous certificate, if any, given for the same shall have been
surrendered and canceled.

     Section 2. CLOSING OF TRANSFER BOOKS. For the purpose of determining
stockholders entitled to notice of or to vote at any meeting of stockholders, or
stockholders entitled to receive payment of any



                                     - 17 -


dividend, or in order to make a determination of stockholders for any proper
purpose, the Board of Directors may provide that the stock transfer books shall
be closed for a stated period but not to exceed, in any case, sixty (60) days.
If the stock transfer books shall be closed for the purpose of determining
stockholders entitled to notice of or to vote at a meeting of stockholders, such
books shall be closed for at least ten (10) days immediately preceding such
meeting. In lieu of closing the stock transfer books, the Board of Directors may
fix in advance a date as the record for any determination of stockholders, such
date in any case to be not more than sixty (60) days, and in case of a meeting
of stockholders not less than ten (10) days, prior to the date upon which the
particular action requiring such determination of stockholders is to be taken.
If the stock transfer books are not closed and no record date is fixed for the
determination of stockholders entitled to vote at a meeting thereof or to
receive payment of a dividend, the date on which notice of the meeting is mailed
or the date on which the resolution of the Board of Directors declaring such
dividends is adopted, as the case may be, shall be the record date for such
determination of stockholders.

     Section 3. LOST, DESTROYED OR MUTILATED CERTIFICATES. The Board of
Directors may direct a new



                                     - 18 -


certificate or certificates to be issued in place of any certificate or
certificates heretofore issued by the Corporation alleged to have been lost,
destroyed or mutilated upon the making of an affidavit of that fact by the
person claiming the certificates for shares to be lost or destroyed. When
authorizing such issuance of a new certificate or certificates, the Board of
Directors may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost or destroyed certificate or
certificates, or his legal representative, to advertise the same in such manner
as it shall require, or to give the Corporation a bond in such sums as it may
direct, as indemnity against any claim that may be made against the Corporation
with respect to the certificate alleged to have been lost or destroyed.

                                  ARTICLE VII.

                                 INDEMNIFICATION

     Section 1. INDEMNIFICATION. (1) Each person who was or is made a party or
is threatened to be made a party to or is otherwise involved in any action, suit
or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact: (i) that he or she is or
was a director or officer of the Corporation, or (ii) that he or she,



                                     - 19 -


being at the time a director or officer of the Corporation, is or was serving at
the request of the Corporation as a director, trustee, officer, employee or
agent of another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to an employee benefit plan
(collectively, "another enterprise"), whether either in case (i) or case (ii)
the basis of such proceeding is alleged action or inaction (a) in an official
capacity as a director or officer of the Corporation, or as a director, trustee,
officer, employee or agent of such other enterprise, or (b) in any other
capacity related to the Corporation or such other enterprise while so serving as
a director, trustee, officer, employee or agent, shall be indemnified and held
harmless by the Corporation to the fullest extent authorized by the Delaware
General Corporation Law, as the same exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that such amendment permits
the Corporation to provide broader indemnification rights than permitted prior
thereto), against all expenses, liability and loss (including without limitation
attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts
paid in settlement) reasonably incurred or suffered by such person in connection
therewith. The persons indemnified by this paragraph (1) of this



                                     - 20 -


Article VII are hereinafter referred to as "indemnitees." Such
indemnification as to such alleged action or inaction shall continue as to an
indemnitee who has after such alleged action or inaction ceased to be a
director or officer of the Corporation, or director, officer, employee or
agent of such other enterprise; and shall inure to the benefit of the
indemnitee's heirs, executors and administrators; PROVIDED, HOWEVER, that,
except as provided in paragraph (2) of this Article VII with respect to
proceedings to enforce rights to indemnification, the Corporation shall
indemnify any such indemnitee in connection with a proceeding (or portion
thereof) initiated by such indemnitee only if such proceeding (or portion
thereof) was authorized by the Board of Directors. The right to
indemnification conferred in this Article VII (a) shall be a contract right;
(b) shall not be affected adversely to any indemnitee by any amendment of
this Certificate of Incorporation with respect to any action or inaction
occurring prior to such amendment; and (c) shall include the right to be paid
by the Corporation the expenses incurred in defending any such proceeding in
advance of its final disposition (hereinafter an "advancement of expenses");
PROVIDED, HOWEVER, that if and to the extent the Delaware General Corporation
Law requires, an advancement of expenses



                                     - 21 -


incurred by an indemnitee shall be made only upon delivery to the Corporation of
an undertaking (hereinafter an "undertaking"), by or on behalf of such
indemnitee, to repay all amounts as advanced if it shall ultimately be
determined by final judicial decision from which there is no further right to
appeal (hereinafter a "final adjudication") that such indemnitee is not entitled
to be indemnified for such expenses under this Article VII or otherwise.

     (2) If a claim under paragraph (1) of this Article VII is not paid in full
by the Corporation within sixty days after it has been received in writing by
the Corporation, except in the case of a claim for an advancement of expenses,
in which case the applicable period shall be twenty days, the indemnitee may at
any time thereafter bring suit against the Corporation to recover the unpaid
amount of the claim. If successful in whole or in part in any such suit, or in a
suit brought by the Corporation to recover an advancement of expenses pursuant
to the terms of an undertaking, the indemnitee shall be entitled to be paid also
the expense of prosecuting or defending such suit. In (i) any suit brought by
the indemnitee to enforce a right to indemnification hereunder (but not in a
suit brought by the indemnitee to enforce a right to an advancement of expenses)
it shall be a defense that, and (ii) in any



                                     - 22 -


suit by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking the Corporation shall be entitled to recover such
expenses only upon a final adjudication that, the indemnitee has not met the
applicable standard of conduct set forth in the Delaware General Corporation
Law. Neither the failure of the Corporation (including the Board of Directors,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such suit that indemnification of the indemnitee is
proper in the circumstances because the indemnitee has met the applicable
standard of conduct set forth in the Delaware General Corporation Law, nor an
actual determination by the Corporation (including the Board of Directors,
independent legal counsel, or its stockholders) that the indemnitee has not met
such applicable standard of conduct, shall create a presumption that the
indemnitee has not met the applicable standard of conduct or, in the case of
such a suit brought by the indemnitee, be a defense to such suit. In any suit
brought by the indemnitee to enforce a right to indemnification or to an
advancement of expenses hereunder, or by the Corporation to recover an
advancement of expenses pursuant to the terms of an undertaking, the burden of
proving that the indemnitee is not entitled to be indemnified, or to have or
retain



                                     - 23 -


such advancement of expenses, under this Article VII or otherwise, shall
be on the Corporation.

     (3) The rights to indemnification and to the advancement of expenses
conferred in this Article VII shall not be exclusive of any other right which
any person may have or hereafter acquire under any statute, the Certificate of
Incorporation, these By-Laws, agreement, vote of stockholders or disinterested
directors or otherwise.

     (4) The Corporation may maintain insurance, at its expense, to protect
itself and any director, trustee, officer, employee or agent of the Corporation
or another enterprise (as defined in paragraph (1) of this Article VII) against
any expense, liability or loss, whether or not the Corporation would have the
power to indemnify such person against such expense, liability or loss under the
Delaware General Corporation Law.

     (5) The Corporation may, to the extent authorized from time to time by the
Board of Directors, grant rights to indemnification, and to the advancement of
expenses, to any employee or agent of the Corporation (or any person serving at
the Corporation's request as a director, trustee, officer, employee, or agent of
another enterprise) or to persons who are or were a director, officer, employee
or agent of a constituent



                                     - 24 -


corporation absorbed by the Corporation in a consolidation or merger or who is
or was serving at the request of such constituent corporation as a director,
officer, employee or agent of another enterprise, in each case as determined by
the Board to the fullest extent of the provisions of this Article VII in cases
of the indemnification and advancement of expenses of directors and officers of
the Corporation, or to any lesser extent (or greater extent, if permitted by
law) determined by the Board of Directors.


                                 ARTICLE VIII.

                                    DIVIDENDS

     Section 1. PAYMENT OF DIVIDENDS. The Board of Directors may declare and the
Corporation may pay dividends on its outstanding shares in cash, property, or
its shares pursuant to law and subject to the provisions of its Certificate of
Incorporation and By-Laws.

     Section 2. RESERVES. Before payment of any dividend, there may be set aside
out of any funds of the Corporation available for dividends such sum or sums as
the Board of Directors from time to time, in their absolute discretion, deem
proper as a reserve or reserves to meet contingencies, or for equalizing
dividends, or for preparing or maintaining any property



                                     - 25 -


of the Corporation, or for such other purpose as the Board of Directors shall
deem conducive to the interest of the Corporation, and the Board of Directors
may modify or abolish any such reserve in the manner in which it was created.


                                  ARTICLE IX.

                                      SEAL

     The Board of Directors shall provide a corporate seal, which shall be in
form of a circle and shall have inscribed thereon the name of the Corporation,
the years of its organization and the state of incorporation. The seal may be
used by causing it or a facsimile thereof to be impressed or affixed or
reproduced or otherwise.


                                   ARTICLE X.

                                   FISCAL YEAR

     The fiscal year of the Corporation shall be as determined by the Board of
Directors.

                                  ARTICLE XI.

                                   AMENDMENTS

         These By-Laws, or any of them, may be altered, amended or repealed, or
new By-Laws may be made, at any meeting of the Board of Directors, by vote of a
majority of the Board of Directors, provided that the proposed



                                     - 26 -


action in respect thereof shall be stated in the notice of waiver of notice of
such meeting or that all of the directors of the Corporation shall be present at
such meeting.

EX-3.17

                                                                  Exhibit 3.17


[LOGO] Industry Canada          Industrie Canada


                                              
CERTIFICATE                                      CERTIFICAT
OF INCORPORATION                                 DE CONSTITUTION

CANADA BUSINESS                                  LOI CANADIENNE SUR
CORPORATIONS ACT                                 LES SOCIETES PAR ACTIONS




- ------------------------------------------------------------------------------


                                              
3661458 CANADA INC.                                      366145-8


- ----------------------------------------------   ---------------------------------------
Name of corporation-Denomination de la societe   Corporation number-numero de la societe


I hereby certify that the above-named            Je certifie que la societe susmentionnnee, dont
corporation, the articles of incorporation of    les statuts constitutifs sont joints, a ete
which are attached, was incorporated under       constituee en societe en vertu de la
the CANADA BUSINESS CORPORATIONS ACT.            LOI CANADIENNE SUR LES SOCIETES PAR ACTIONS.


/s/ [Illegible]                                  September 15, 1999 / le 15 septembre 1999

Director - Directeur                             Date of Incorporation - Date de constitution




- ------------------------------------------------------------------------------



                                                                              

INDUSTRY CANADA         INDUSTRIE CANADA                         FORM 1                      FORMULE 1
CANADA BUSINESS         LOI CANADIENNE SUR LES        ARTICLES OF INCORPORATION        STATS CONSTITUTIFS
CORPORATIONS ACT        SOCIETEES PAR ACTIONS                 (SECTION 6)                   (ARTICLE 6)
- ---------------------------------------------------------------------------------------------------------
[Illegible]                                                    [Illegible]

    3661458      CANADA INC.
- ---------------------------------------------------------------------------------------------------------
[Illegible]                                                    [Illegible]

     City of Toronto, Province of Ontario
- ---------------------------------------------------------------------------------------------------------
[Illegible]                                                    [Illegible]

     The Corporation is authorized to issue an unlimited number of Common Shares.
- ---------------------------------------------------------------------------------------------------------
[Illegible]                                                    [Illegible]

     No shares of the Corporation shall be transferred without the consent of the directors of the
     Corporation expressed resolution passed by the board of directors or by an instrument or instruments
     in writing signed by all of the directors then in office.
- ---------------------------------------------------------------------------------------------------------
[Illegible]                                                    [Illegible]

     Minimum 1, Maximum 20
- ---------------------------------------------------------------------------------------------------------
[Illegible]                                                    [Illegible]

     There are no restrictions on business the Corporation may carry on or on powers the Corporation may
exercise.

- ---------------------------------------------------------------------------------------------------------





                                       -2-
                                                                              
- ---------------------------------------------------------------------------------------------------------
[Illegible]                                                    [Illegible]




         shall be a condition of the articles that:

     (a) The directors of the Corporation may, without authorization of the
         shareholders, from time to time, in such amount and on such terms as
         they deem expedient:

         (i)   borrow money upon the credit of the Corporation;

         (ii)  issue, re-issue, sell or pledge debt obligations of the
               Corporation;

         (iii) give a guarantee on behalf of the Corporation to secure
               performance of an obligation of any  person; and

         (iv)  mortgage, hypothecate, pledge or otherwise create a security
               interest in all or any property of the Corporation owned or
               subsequently acquired, to secure any obligation of the
               Corporation.

         The directors may, from time to time, by resolution or by-law,
         delegate all or any of the powers referred to above to such an
         extent, and in such manner, to such one or more directors, officers
         or a committee of directors, as the directors shall determine at the
         time of each such delegation.

         Nothing in this subparagraph (a) shall limit or restrict the
         borrowing of money by the Corporation on bills of exchange or
         promissory notes made, drawn, accepted or endorsed by or on behalf
         of the Corporation.

     (b) The number of shareholders is limited to 50 persons, exclusive of
         persons who are in its employment and exclusive of persons who,
         having been formerly in its employment, were, while in that
         employment, and have, after the termination of that employment,
         continued to be Shareholders of the Corporation, two or more persons
         who are the registered joint owners of one of more shares being counted
         as one shareholder.

     (c) Any invitation to the public to subscribe for any shares or other
         securities of the Corporation is prohibited.

     (d) Except in the case of any class or series of shares of the
         Corporation listed on a stock exchange, the Corporation shall have a
         lien on the shares registered in the name of a shareholder or his
         legal representative for a debt of the shareholder to the
         Corporation.

     (e) The holders of any fractional shares issued by the Corporation shall
         be entitled to exercise voting rights and to receive dividends in
         respect of each such fractional share.

     (f) The directors of the Corporation may increase the size of the board
         of directors by appointing one or more director who shall hold
         office for a term expiring not later than the close of the next
         annual meeting of shareholders, but the total number of directors so
         appointed may not exceed one third of the number of directors
         elected at the previous annual meeting of shareholders.



                                       -3-

                                                                        
- --------------------------------------------------------------------------------------------
Incorporators - Fondateurs
- --------------------------------------------------------------------------------------------
Name(s) - Nom(s)                     Address (including postal code)          Signature
                                    Adresse (enclure la code postale)
- --------------------------------------------------------------------------------------------
David Matlow                        810 Briar Hill Avenue                   /s/ David Matlow
                                    Toronto, Ontario M5N 1N2
- --------------------------------------------------------------------------------------------


- --------------------------------------------------------------------------------------------


- --------------------------------------------------------------------------------------------
FOR DEPARTMENTAL USE ONLY-ALL L'USAGE DU MINISTERE SEULEMENT   [Illegible]
Corporation No.-No. de la societe
                   366145-8                                                  SEP 16 1999
- --------------------------------------------------------------------------------------------

EX-3.18

                                                                  EXHIBIT 3.18

                                  BY-LAW NO. 1

              A by-law relating generally to the regulation of the

                             business and affairs of

                               3661458 CANADA INC.

                                    CONTENTS

                      ONE            INTERPRETATION
                      TWO            DIRECTORS
                      THREE          MEETINGS OF DIRECTORS
                      FOUR           COMMITTEES
                      FIVE           OFFICERS
                      SIX            PROTECTION OF DIRECTORS,
                                     OFFICERS AND OTHERS
                      SEVEN          MEETINGS OF SHAREHOLDERS
                      EIGHT          SECURITIES
                      NINE           DIVIDENDS AND RIGHTS
                      TEN            EXECUTION OF DOCUMENTS
                                     AND VOTING OF SECURITIES
                      ELEVEN         NOTICES

      RESOLVED as a by-law of 3661458 CANADA INC. (hereinafter called the
"Corporation") as follows:

                                   SECTION ONE
                                 INTERPRETATION

1.1 DEFINITIONS.

      In this by-law and in all other by-laws of the Corporation, unless the
context otherwise requires:

      (a)   "Act" means the Canada Business Corporations Act as amended or
            re-enacted from time to time and the Regulations made pursuant
            thereto;

      (b)   "board" means the board of directors of the Corporation;

      (c)   "by-laws" means all by-laws of the Corporation;

      (d)   "contracts, documents or instruments in writing" includes deeds,
            mortgages hypothecs, charges, conveyances, transfers and assignments
            of property, real or personal, immovable or movable, agreements,
            releases, receipts and discharges for the payment of money or
            shares, share warrants, bonds, debentures or other securities and
            all paper writings;

      (e)   "director" means a director of the Corporation;

      (f)   "non-business day" means Saturday, Sunday and any other day that is
            a holiday as defined in the Interpretation Act (Canada);

      (g)   "number of directors" means the number of directors provided for in
            the articles or, where a minimum and maximum number of directors is
            provided for in the articles, the number of


                                      -2-

            directors determined by special resolution and the Form 6 filed
            pursuant to the Act;

      (h)   the singular includes the plural and the plural includes the
            singular; and

      (i)   all words importing gender includes the masculine, feminine and
            neuter genders.

1.2 All terms used in the by-laws of the Corporation which are defined in the
Act shall have the meanings given to such terms under the Act.

1.3 Headings used in the by-laws are for convenience of reference only and shall
not affect the construction or interpretation thereof.

1.4 If any of the provisions contained in this by-law are inconsistent with
those contained in the Act, the articles or a unanimous shareholders' agreement,
the provisions contained in the articles or unanimous shareholders' agreement,
as the case may be, shall prevail.

                                   SECTION TWO
                                    DIRECTORS

2.1 QUORUM. The quorum for the transaction of business at any meeting of the
board shall consist of a majority of the number of directors.

2.2 QUALIFICATION. No person shall be qualified for election as a director if he
is less than 18 years of age; if he is of unsound mind and has been so found by
a court in Canada or elsewhere; if he is not an individual; or if he has the
status of a bankrupt. A director need not be a shareholder. A majority of the
directors shall be resident Canadians provided that if the number of directors
is fewer than three, at least one shall be a resident Canadian.

2.3 ELECTION AND TERM. The election of directors shall take place at the first
meeting of shareholders and at each annual meeting of shareholders. A director
not elected for an expressly stated term shall cease to hold office at the close
of the first annual meeting following his election or appointment. If an
election is not held at the proper time, the incumbent directors shall continue
in office until their successors are elected.

2.4 REMOVAL OF DIRECTORS. Subject to the provisions of the Act, the shareholders
may by ordinary resolution passed at a special meeting remove any
director from office and the vacancy created by such removal may be filled at
the same meeting failing which it may be filled by the directors.

2.5 VACATION OF OFFICE. A director ceases to hold office when he dies; he is
removed from office by the shareholders; he ceases to be qualified for election
as a director; or his written resignation is sent to the Corporation; or if
a time is specified in such resignation, at the time so specified, whichever is
later.

2.6 VACANCIES. Subject to the Act, a quorum of the board may fill a vacancy in
the board, except a vacancy, resulting from an increase in the number or minimum
number of directors or from a failure of the shareholders to elect the number or
minimum number of directors required by the articles.

2.7 REMUNERATION AND EXPENSES. The directors shall be paid such remuneration for
their services as the board may from time to time determine and shall also be
entitled to be reimbursed for travelling and other expenses properly incurred by
them in attending meetings of the board or any committee thereof. Nothing herein
contained shall preclude any director from serving the Corporation in any other
capacity and receiving remuneration therefor.



                                      -3-

                                  SECTION THREE
                              MEETINGS OF DIRECTORS

3.1 CANADIAN MAJORITY. The board shall not transact business at a meeting, other
than filling a vacancy in the board, unless a majority of the directors present
are resident Canadians, except where:

      (a)   a resident Canadian director who is unable to be present approves in
            writing or by telephone or other communications facilities the
            business transacted at the meeting; and

      (b)   a majority of resident Canadian directors would have been present
            had that director been present at the meeting.

3.2 MEETINGS BY TELEPHONE. If all the directors present at or participating in
the meeting consent, a director may participate in a meeting of the board or of
a committee of the board by means of such telephone or other communications
facilities as ? permit all persons participating in the meeting to hear each
other; and a director participating in such a meeting by such means is deemed to
be present at the meeting. Any such consent shall be effective whether given
before or after the meeting to which it relates and may be given with respect to
all meetings of the board and of committees of the board held while a director
holds office.

3.3 PLACE OF MEETINGS. Meetings of the board may be held at any place within or
outside Canada. In any financial year of the Corporation, a majority of the
meetings of the board need not be held within Canada.

3.4 CALLING OF MEETINGS. Meetings of the board may be held at any time by
the president or any director upon notice given to all directors in accordance
with Section 3.5.

3.5 NOTICE. Notice of the time and place of each meeting of the board shall be
given in the manner provided in subsection 11.1 to each director (a) not less
than 48 hours before the time when the meeting is to be held if the notice is
mailed, or (b) not less than 24 hours before the time the meeting is to be held
if the notice is given personally or is delivered or is sent by any means of
transmitted or recorded communication.

3.6 WAIVER OF NOTICE. A director may in any manner or at any time waive notice
of or otherwise consent to a meeting of the board. Attendance of a director at a
meeting of the board shall constitute a waiver of notice of that meeting,
except where a director attends for the express purpose of objecting to the
transaction of any business on the grounds that the meeting is not lawfully
called.

3.7 FIRST MEETING OF NEW BOARD. Provided a quorum of directors is present, each
newly elected board may without notice hold its first meeting immediately
following the meeting of shareholders at which such board is elected.

3.8 ADJOURNED MEETING. Notice of an adjourned meeting of the board is not
required if the time and place of the adjourned meeting is announced at the
original meeting.

3.9 REGULAR MEETINGS. The board may appoint a day or days in any month or months
for regular meetings of the board at a place and hour to be named. A copy of any
resolution of the board fixing the place and time of such regular meetings shall
be sent to each director forthwith after being passed, but no other notice shall
be required for any such regular meeting except where the Act requires the
purpose thereof or the business to be transacted thereat to be specified.

3.10 CHAIRMAN. The chairman of any meeting of the board shall be the first
mentioned of such of the following officers as have been appointed and who, with
the exception of the Chairman of the Board, is a director and is present at the
meeting: chairman of the board, managing director, president, or a
vice-president (in order of seniority). If no such officer is present, the
directors present shall choose one of their number to be chairman.

3.11 VOTES TO GOVERN. At all meetings of the board, every question shall be
decided by a majority of the votes cast on the question. In case of an equality
of votes, the Chairman of the meeting shall not be entitled to a second or
casting vote.


                                      -4-

3.12 ONE DIRECTOR MEETING. Where the board consists of only one director, that
director may constitute a meeting.

                                  SECTION FOUR
                                   COMMITTEES

4.1 COMMITTEE OF DIRECTORS. The board may appoint from their number one or more
committees of the board, however designated, and delegate to such committee any
of the powers of the board except those which, under the Act, a committee of the
board has no authority to exercise. A majority of the members of any such
committee shall be resident Canadian.

4.2 AUDIT COMMITTEE. If the Corporation is an offering corporation, the board
shall, and otherwise the board may, constitute an audit committee composed of
not fewer than three directors, a majority of whom are not officers or employees
of the Corporation or any of its affiliates, and who shall hold office until the
next annual meeting of shareholders. The audit committee shall have the powers
and duties provided in the Act.

4.3 TRANSACTION OF BUSINESS. The powers of a committee of the board may be
exercised by a meeting at which a quorum is present or by resolution in writing
signed by all the members of such committee who would have been entitled to vote
on that resolution at a meeting of the committee. Meetings of such committee may
be held at any place within or outside Canada.

4.4 PROCEDURE. Unless otherwise determined by the board, each committee shall
have the power to fix its quorum at not less than a majority of its members, to
elect its chairman and to regulate its procedure. To the extent that the board
or the committee does not establish rules to regulate the procedure of the
committee, the provisions of this by-law applicable to meetings of the board
shall apply mutatis mutandis.

                                  SECTION FIVE
                                    OFFICERS

5.1 APPOINTMENT. The board may designate the offices of the Corporation and from
time to time appoint a chairman of the board, managing director (provided he is
a resident Canadian), president, one or more vice-presidents (to which title may
be added words indicating seniority or function), a secretary, a treasurer and
such other officers as the board may determine, including one or more assistants
to any of the officers so appointed. The board may specify the duties of and,
subject to the provisions of the Act, delegate to such officers powers to
manage the business and affairs of the Corporation. One person may hold more
than one office and, except for the chairman of the board and the managing
director, an officer need not be a director.

5.2 CHAIRMAN OF THE BOARD. If appointed, the board may assign to the chairman of
the board any of the powers and duties that are by any provisions of this by-law
assigned to the managing director or to the president and subject to the Act,
such other powers and duties as the board may specify. The chairman of the board
shall, when present, preside at all meetings of the board and shareholders.
Subject to subsections 3.10 and 7.8, during the absence or disability of the
chairman of the board, his duties shall be performed and his powers exercised by
the first mentioned of the following officers then in office: the managing
director, the president, or a vice-president (in order of seniority).

5.3 MANAGING DIRECTOR. If appointed, the managing director shall be the chief
executive officer and, subject to the authority of the board, shall have general
supervision of the business and affairs of the Corporation; and he shall,
subject to the provisions of the Act, have such other powers and duties as the
board may specify. During the absence or disability of the president, or if no
president has been appointed, the managing director shall also have the powers
and duties of that office.

5.4 PRESIDENT. If appointed, the president shall have general supervision of the
business and affairs of the Corporation, subject to the direction and authority
of the board, the chairman of the board and the managing director; and he shall
have such other powers and duties as the board may specify. During the absence
or


                                      -5-

disability of the managing director, or if no managing director has been
appointed, the president shall also have the powers and duties of that
office. In the absence of the chairman of the board as such, the president
shall be the chief executive officer of the Corporation. Otherwise, the
president shall be the chief operating officer of the Corporation.

5.5 VICE PRESIDENT. The vice-president, or if more than one, the
vice-presidents, in order of seniority, as designated by the board, shall be
vested with all the powers and perform all the duties of the president in his
absence, inability or refusal to act except that he shall not preside at any
meeting of the directors unless he is appointed to do so by the board. A
vice-president shall have such powers and duties as the board or the chief
executive officer may specify.

5.6 SECRETARY. The secretary shall attend and be the secretary of all meetings
of the board, shareholders and committees of the board and shall enter or cause
to be entered in records kept for that purpose minutes of all proceedings
thereat; he shall give or cause to be given, as and when instructed, all notices
to shareholders, directors, officers and auditors; he shall be the custodian of
all books, papers, records, documents and instruments belonging to the
Corporation, except when some other officer or agent has been appointed for that
purpose; and he shall have such other duties and powers as the board or the
chief executive officer may specify.

5.7 TREASURER. The treasurer shall keep or cause to be kept proper accounting
records in compliance with the Act and shall be responsible for the deposit of
money, the safekeeping of securities and the disbursement of funds of the
Corporation; he shall render to the board, whenever required, an account of all
his transactions as treasurer and of the financial position of the corporation;
and he shall have such other powers and duties as the board or the chief
executive officer may specify.

5.8 POWERS AND DUTIES OF OTHER OFFICERS. The powers and duties of all other
officers shall be such as the terms of their engagement call for the board
or the chief executive officer may specify. Any of the powers and duties of an
officer to whom an assistant has been appointed may be exercised and performed
by such assistant unless the board otherwise directs.

5.9 VARIATION OF POWERS AND DUTIES. Subject to the provisions of the Act, the
board may from time to time vary, add to or limit the powers and duties of any
officer.

5.10 TERM OF OFFICE. The board, in its discretion, may remove any officer of the
Corporation, without prejudice to such officer's rights under any employment
contract. Otherwise, such officer appointed by the board shall hold office until
his successor is appointed, except that the term of office of the chairman of
the board or managing director shall expire when the holder thereof ceases to be
a director.

5.11 AGENTS AND ATTORNEYS. The board shall have power from time to time to
appoint agents or attorneys for the Corporation in or out of Ontario with such
powers of management or otherwise (including the power to sub-delegate) as may
be thought fit.

5.12 FIDELITY BONDS. The board may require such officers, employees and agents
of the Corporation as the board deems advisable to furnish bonds for the
faithful discharge of their duties, in such form and with such surety as the
board may from time to time prescribe.

                                   SECTION SIX
                      PROTECTION OF DIRECTORS AND OFFICERS

6.1 LIMITATION OF LIABILITY. No director or officer shall be liable for the
acts, receipts, neglects or defaults of any other director, officer, employee,
or agent, or for joining in any receipt or other act for conformity, or for any
loss, damage or expense happening to the Corporation through the insufficiency
or deficiency of title to any property acquired for or on behalf of the
Corporation, or for the insufficiency or deficiency of any security in or upon
which any of the moneys of the Corporation shall be invested, or for any loss or
damage arising from the bankruptcy, insolvency or tortious acts of any person
with whom any of the moneys, securities or effects of the Corporation shall be
deposited, or for any loss occasioned by any error of judgment or oversight on
his part, or for any other loss, damage or misfortune whatever which shall
happen in the execution of the duties of his office or


                                      -6-

in wilful neglect or default; provided that nothing herein shall relieve any
director or officer from the duty to act in accordance with the Act or from
liability for any breach thereof.

6.2 INDEMNITY. The Corporation shall indemnify and save harmless every director
or officer, every former director or officer, and every person who acts or acted
at the Corporation's request as a director or officer of a body corporate of
which the Corporation is or was a shareholder or creditor (or a person who
undertakes or has undertaken any liability on behalf of the Corporation or any
such body corporate) and his heirs and legal representatives, from and against
all costs, charges and expenses, including an amount paid to settle an action or
satisfy a judgment, reasonably incurred by him in respect of any civil, criminal
or administrative action or proceeding to which he is made a party by reason of
being or having been a director or officer of the Corporation or such body
corporate, if:

      (a)   he acted honestly and in good faith with a view to the best
            interests of the Corporation; and

      (b)   in the case of a criminal or administrative action or proceeding
            that is enforced by a monetary penalty, he had reasonable grounds
            for believing that his conduct was lawful.

6.3 INSURANCE. Subject to the limitations contained in the Act, the Corporation
may purchase and maintain such insurance for the benefit of any person referred
to in subsection 6.2 hereof, as the board may from time to time determine.

                                  SECTION SEVEN
                            MEETINGS OF SHAREHOLDERS

7.1 ANNUAL MEETINGS. The annual meeting of shareholders shall be held at such
time in each year and, subject to subsection 7.3, at such place as the board,
the chairman of the board, the managing director or the president may from time
to time determine, for the purpose of considering the financial statements and
reports required by the Act to be placed before the annual meeting, electing
directors, appointing auditors and fixing or authorizing the board to fix their
remuneration, and for the transaction of such other business as may properly be
brought before the meeting.

7.2 SPECIAL MEETINGS. The board, the chairman of the board, the managing
director or the president shall have power to call a special meeting of
shareholders at any time.

7.3 PLACE OF MEETINGS. Meetings of shareholders shall be held at the place where
the registered office of the Corporation is situated or, if the board shall so
determine, at some other place in Canada or, if all the shareholders entitled to
vote at the meeting so agree, at some place outside Canada.

7.4 NOTICE OF MEETINGS. Notice of the time and place of each meeting of
shareholders (and of each meeting of shareholders adjourned for an aggregate of
30 days or more) shall be given not less than 21 days and not more than 50 days
before the date of the meeting to each director, to the auditor and to each
shareholder who at the close of business on the record date for notice, if any,
is entered in the securities register as the holder of one or more shares
carrying the right to vote at the meeting. Notice of a meeting of shareholders
called for any purpose other than consideration of the directors and
re-appointment of the incumbent auditor shall specify the time and place of the
meeting shall state the nature of such business in sufficient detail to permit
the shareholder to form a reasoned judgment thereon and shall state the text of
any special resolution to be submitted to the meeting. A shareholder and any
other person entitled to attend a meeting of shareholders may in any manner
waive notice of a meeting of shareholders, and attendance of any such person at
a meeting of shareholders is a waiver of notice of the meeting except where he
attends a meeting for the express purpose of objecting to the transaction of any
business on the grounds that the meeting is not lawfully called.

7.5 LIST OF SHAREHOLDERS ENTITLED TO NOTICE. For every meeting of shareholders,
the Corporation shall prepare a list of shareholders entitled to receive notice
of the meeting, arranged in alphabetical order and showing the number of shares
entitled to vote at the meeting held by each shareholder. If a record date for
the meeting is fixed pursuant to subsection 7.6, the shareholders listed shall
be those registered at the close of


                                      -7-

business on the record date and such list shall be prepared not later than
ten days after such record date. If no record date is fixed, the list shall
be prepared at the close of business on the day immediately preceding the day
on which notice of the meeting is given, or where no such notice is given,
the day on which the meeting is held and shall list all shareholders
registered at such time. The list shall be available for examination by any
shareholder during usual business hours at the registered office of the
Corporation or at the place where the securities register is kept and at the
place where the meeting is held.

7.6 RECORD DATE FOR NOTICE. The board may fix in advance a record date,
preceding the date of any meeting of shareholders by not more than 50 days and
not less than 21 days, for the determination of the shareholders entitled to
notice of the meeting; and notice of any such record date shall be given not
less than seven days before such record date by newspaper advertisement in the
manner provided in the Act. If no record date is so fixed, the record date for
the determination of the shareholders entitled to notice of the meeting shall be
the close of business on the day immediately preceding the day on which the
notice is given.

7.7 MEETINGS WITHOUT NOTICE. A meeting of shareholders may be held without
notice at any time and place permitted by the Act:

      (a)   if all the shareholders entitled to vote thereat are present in
            person or represented by proxy or if those not present or
            represented by proxy waive notice of or otherwise consent to such
            meeting being held; and

      (b)   if the auditor and the directors are present or waive notice of or
            otherwise consent to such meeting being held.

At such a meeting, any business may be transacted which the Corporation at a
meeting of shareholders may transact.

7.8 CHAIRMAN, SECRETARY AND SCRUTINEERS. The chairman of any meeting of
shareholders shall be the first mentioned of such of the following officers as
have been appointed and who is present at the meeting: chairman of the board,
managing director, president, or a vice-president who is a shareholder. If no
such officer is present within 15 minutes from the time fixed for holding the
meeting, the persons present and entitled to vote shall choose one of their
number to be chairman. If the secretary of the Corporation is absent, the
chairman shall appoint some person, who need not be a shareholder, to act as
secretary of the meeting. If desired, one or more scrutineers, who need not be
shareholders, may be appointed by a resolution or by the chairman with the
consent of the meeting.

7.9 PERSONS ENTITLED TO BE PRESENT. The only persons entitled to attend a
meeting of shareholders shall be those entitled to vote thereat, the
directors, the auditor of the Corporation and others who, although not entitled
to vote, are entitled or required under any provision of the Act, the articles
or the by-laws to be present at the meeting. Any other person may be admitted
only on the invitation of the chairman of the meeting or with the consent of the
meeting.

7.10 QUORUM. A quorum for the transaction of business at any meeting of
shareholders shall be two persons present in person, each being a shareholder
entitled to vote thereat or a duly appointed proxy for an absent shareholder so
entitled. Notwithstanding the foregoing, if the Corporation has only one
shareholder, or only one shareholder of any class or series of shares, the
shareholder present in person or by proxy constitutes a meeting and a quorum for
such meeting.

7.11 RIGHT TO VOTE. Subject to the provisions of the Act as to authorized
representatives of any other body corporate, at any meeting of shareholders in
respect of which the Corporation has prepared the list referred to in subsection
7.5, every person who is named in such list shall be entitled to vote the shares
shown thereon opposite his name except to the extent that such person has
transferred any of his shares after the date on which the list is prepared or,
where a record date has been fixed, after the record date and the transferee,
upon producing properly endorsed certificates evidencing such shares or
otherwise establishing that he owns such shares, demands at any time prior to
the meeting that his name be included to vote the transferred shares at the
meeting. In the absence of a list prepared as aforesaid in respect of a meeting
of shareholders, every person shall be entitled to


                                      -8-

vote at the meeting who at the time is entered in the securities register as
the holder of one or more shares carrying the right to vote at such meeting.

7.12 PROXIES. Every shareholder entitled to vote at a meeting of shareholders
may appoint a proxyholder, or one or more alternate proxyholders, who need not
be shareholders, to attend and act at the meeting in the manner and to the
extent authorized and with the authority conferred by the proxy. A proxy shall
be in writing, executed by the shareholder or his attorney, shall conform with
the requirements of the Act.

7.13 TIME FOR DEPOSIT OF PROXIES. The board may specify in a notice calling a
meeting of shareholders a time, preceding the time of such meeting by not more
than 48 hours exclusive of non-business days, before which time proxies shall
be acted upon only if, prior to the time so specified, it shall have been
deposited with the Corporation or an agent thereof specified in such notice or,
if no such time is specified in such notice, unless it has been received by
the secretary of the Corporation or by the chairman of the meeting or any
adjournment thereof prior to the time of voting.

7.14 JOINT SHAREHOLDERS. If two or more persons hold shares jointly, any one of
them present in person or represented by proxy at a meeting of shareholders may,
in the absence of the other or others, vote the shares; but if two or more of
those persons are present in person or represented by proxy and vote, they shall
vote as one the shares jointly held by them.

7.15 VOTES TO GOVERN. At any meeting of shareholders every question shall,
unless otherwise required by law, be determined by the majority of the votes
cast on the question. In the case of an equality of votes either upon a show of
hands or upon a ballot, the chairman of the meeting shall not be entitled to a
second or casting vote.

7.16 SHOW OF HANDS. Subject to the provisions of the Act, any question at a
meeting of shareholders shall be decided by a show of hands unless a ballot
thereon is required or demanded as hereinafter provided. Upon a show of hands,
every person who is present and entitled to vote shall have one vote. Whenever a
vote by show of hands shall have been taken upon a question, unless a ballot
thereon is so required or demanded, a declaration by the chairman of the meeting
as to the result of the vote upon the question and an entry to that effect in
the minutes of the meeting shall be prima facie evidence of the fact without
proof of the number or proportion of the votes recorded in favour of or against
any resolution or other proceeding in respect of such question, and the result
of the vote so taken shall be the decision of the shareholders upon such
question.

7.17 BALLOTS. On any question proposed for consideration at a meeting of
shareholders, and whether or not a show of hands has been taken thereon, any
shareholder or proxyholder entitled to vote at the meeting may demand a ballot.
A ballot so demanded shall be taken in such manner as the chairman shall direct.
A demand for a ballot may be withdrawn at any time prior to the taking of the
ballot. The result of the ballot so taken shall be the decision of the
shareholders upon the question.

7.18 RESOLUTION IN WRITING. A resolution in writing signed by all of the
shareholders entitled to vote on that resolution at a meeting of shareholders is
as valid as if it had been passed at a meeting of the shareholders unless a
written statement with respect to the subject matter of the resolution is
submitted by a director or the auditor in accordance with the Act.

                                  SECTION EIGHT
                                   SECURITIES

8.1 REGISTRATION OF TRANSFER. Subject to the provisions of the Act, no transfer
of shares shall be registered in a securities register except upon presentation
of the certificate representing such shares with a transfer endorsed thereon or
delivered therewith duly executed by the registered holder or by his attorney or
successor duly appointed, together with such reasonable assurance or evidence of
signature, identification and authority to transfer as the board may from time
to time prescribe, upon payment of all applicable taxes and any fees prescribed
by the board, upon compliance with such restrictions on transfer as are
authorized by the articles and upon satisfaction of any lien referred to in
subsection 8.4.


                                      -9-

8.2 TRANSFER AGENTS AND REGISTRARS. The board may from time to time appoint a
registrar to maintain the securities register and a transfer agent to maintain
the register of transfers and may also appoint one or more branch registrars to
maintain branch securities registers and one or more branch transfer agents to
maintain branch registers of transfers, but one person may be appointed both
registrar and transfer agent. The board may at any time terminate any such
appointment.

8.3 LIEN ON SHARES. The Corporation has a lien on shares registered in the
name of a shareholder or his legal representative for a debt of that
shareholder to the Corporation.

8.4 ENFORCEMENT OF LIEN. The lien referred to in subsection 8.3 may be enforced
by any means permitted by law and:

      (a)   where the share or shares are redeemable pursuant to the articles of
            the Corporation by redeeming such share or shares and applying the
            redemption price to the debt;

      (b)   subject to the Act, by purchasing the share or shares for
            cancellation for a price equal to the book value of such share or
            shares and applying the proceeds to the debt;

      (c)   by selling the share or shares to any third party whether or not
            such party is at arm's length to the Corporation, and including,
            without limitation, any officer or director of the Corporation, for
            the best price which the directors consider to be obtainable for
            such share or shares; or

      (d)   by refusing to register a transfer of such share or shares until the
            debt is paid.

8.5 SECURITY CERTIFICATES. Every holder of securities of the Corporation shall
be entitled, at his option, to a security certificate, or to a non-transferable
written acknowledgement of his right to obtain a security certificate, stating
the number and designation, class or series of securities held by him as shown
on the securities register. Security certificates and acknowledgements of a
securities holder's right to a security certificate, respectively, shall be in
such form as the board shall from time to time approve. Any security certificate
shall be signed in accordance with subsection 10.1. A security certificate shall
be signed manually by at least one director or officer of the Corporation or by
or on behalf of the transfer agent and/or registrar. Any additional signatures
required may be printed or otherwise mechanically reproduced. A security
certificate executed as aforesaid shall be valid notwithstanding that one of the
directors or officers whose facsimile signature appears thereon no longer holds
office at the date of issue of the certificate.

8.6 REPLACEMENT OF SECURITY CERTIFICATES. The board, any officer or any agent
designated by the board may in its or his discretion direct the issue of a new
security certificate in lieu of and upon cancellation of a security certificate
that has been mutilated. In the case of a security certificate claimed to have
been lost, destroyed or wrongfully taken, the board, any officer or any agent
designated by the board shall issue a substitute security certificate if so
requested before the Corporation has notice that the security has been acquired
by a bona fide purchaser. The issuance of the substitute security certificate
shall be on such reasonable terms as to indemnity, reimbursement of expenses and
evidence of loss and of title as the board or the officer or the agent
designated by the board responsible for such issuance may from time to time
prescribe, whether generally or in any particular case.

8.7 JOINT SHAREHOLDERS. If two or more persons are registered as joint holders
of any security, the Corporation shall not be bound to issue more than one
certificate in respect thereof, and delivery of such certificate to one of such
persons shall be sufficient delivery to all of them. Any one of such persons may
give effectual receipts for the certificate issued in respect thereof or for any
dividend, bonus, return of capital or other money payable or warrant issuable in
respect of such security.

8.8 DECEASED SECURITY HOLDERS. Subject to the provisions of paragraph 8.9 below,
in the event of the death of a holder of any security, the Corporation shall not
be required to make any entry in the securities register in respect thereof or
to make payment of any dividends thereon except upon production of all such
documents as may be required by law and upon compliance with the reasonable
requirements of the Corporation,


                                      -10-

which reasonable requirements shall in the discretion of the board not
necessarily include the production of letters probate or letters of
administration.

8.9 DECEASED JOINTLY-HELD SECURITY HOLDERS. Where a share is registered in the
name of two or more persons as joint holders with rights of survivorship, upon
satisfactory proof of the death of one joint holder and without the requirement
of letters probate or letters of administration, the Corporation shall treat the
surviving joint holder(s) as the sole owner(s) of the share effective as of the
date of death of such joint holder and the Corporation shall make the
appropriate entry in the securities register to reflect such ownership.

                                  SECTION NINE
                              DIVIDENDS AND RIGHTS

9.1 DIVIDENDS. Subject to the provisions of the Act, the board may from time to
time by resolution declare and the Corporation may pay dividends to the
shareholders according to their respective rights and interests in the
Corporation. Dividends may be paid in money or property, subject to the
restrictions on the declaration and payment thereof under the Act, or by issuing
fully paid shares of the Corporation or options or rights to acquire fully paid
shares of the Corporation.

9.2 DIVIDEND CHEQUES. A dividend payable in cash shall be paid by cheque drawn
on the Corporation's bankers or one of them to the order of each registered
holder of shares of the class or series in respect of which it has been declared
and mailed by prepaid ordinary mail to such registered holder at his recorded
address, unless such holder otherwise directs. In the case of joint holders the
cheque shall, unless such joint holders otherwise direct, be made payable to the
order of all of such joint holders and mailed to them at their recorded address.
The mailing of such cheque as aforesaid, unless the same is not paid on due
presentation, shall satisfy and discharge the liability for the dividend to the
extent of the sum represented thereby plus the amount of any tax which the
Corporation is required to and does withhold.

9.3 NON-RECEIPT OF CHEQUES. In the event of non-receipt of any dividend cheque
by the person to whom it is sent as aforesaid, the Corporation shall issue to
such person a replacement cheque for a like amount on such terms as to
indemnity, reimbursement of expenses and evidence of non-receipt and of title as
the board may from time to time prescribe, whether generally or in any
particular case.

9.4 RECORD DATE FOR DIVIDENDS AND RIGHTS. The board may fix in advance a date as
a record date for the determination of the persons entitled to receive payment
of dividends and to subscribe for securities of the Corporation, provided that
such record date shall not precede by more than 50 days the particular action to
be taken. Notice of any such record date shall be given not less than seven days
before such record date, by newspaper advertisement in the manner provided in
the Act, unless notice of the record date is waived by every holder of a share
of the class or series affected whose name is set out in the securities register
at the close of business on the day the directors fix the record date. If the
shares of the Corporation are listed for trading on one or more stock exchanges
in Canada, notice of such record date shall also be sent to such stock
exchanges. Where no record date is fixed in advance as aforesaid, the record
date for the determination of the persons entitled to receive payment of any
dividend or to exercise the right to subscribe for securities of the Corporation
shall be at the close of business on the day on which the resolution relating to
such dividend or right to subscribe is passed by the board.

9.5 UNCLAIMED DIVIDENDS. Any dividend unclaimed after a period of six years from
the date on which it has been declared to be payable shall be forfeited and
shall revert to the Corporation.

                                   SECTION TEN
                 EXECUTION OF DOCUMENTS AND VOTING OF SECURITIES

10.1 EXECUTION OF INSTRUMENTS. Contracts, documents and other instruments in
writing may be signed on behalf of the Corporation by such person or persons as
the board may from time to time by resolution designate. In the absence of an
express designation as to the persons authorized to sign either contracts,
documents or instruments in writing generally or to sign specific contracts,
documents or instruments in writing, any of the directors and officers of
the Corporation may sign contracts, documents or



                                      -11-

instruments in writing on behalf of the Corporation. The corporate seal, if
any, of the Corporation may be affixed to any contract, obligation or
instrument in writing requiring the corporate seal of the Corporation by any
person authorized to sign the same on behalf of the Corporation.

      The phrase "contracts, documents and other instruments in writing" as used
in this provision shall include deeds, mortgages, hypothecs, charges,
conveyances, transfers and assignments of property, real or personal, immovable
or movable, agreements, releases, receipts and discharges for the payment of
money or other obligations, conveyances, transfers and assignments of
securities, all paper writings, all cheques, drafts or orders for the payment of
money and all notes, acceptances and bills of exchange.

10.2 VOTING RIGHTS IN OTHER CORPORATIONS. All securities carrying voting rights
of any other corporation held from time to time by the Corporation may be voted
at any and all meetings of shareholders, bond holders, debenture holders or
holders of other securities (as the case may be) of such other corporation and
in such manner as the board may from time to time determine. Any person or
persons authorized to sign on behalf of the Corporation may also from time to
time execute and deliver for and on behalf of the Corporation proxies and/or
arrange for the issuance of voting certificates and/or other evidence of the
right to vote in such names as they may determine.

                                 SECTION ELEVEN
                                     NOTICES

11.1 METHOD OF SENDING NOTICE. Any notice (which term includes any communication
or document) to be sent pursuant to the Act, the articles, the by-laws or
otherwise to a shareholder, director, officer, or to the auditor shall be
sufficiently sent if delivered personally to the person to whom it is to be sent
or if delivered to his recorded address or if mailed to him at his recorded
address by prepaid mail or if sent to him at his recorded address by any means
of prepaid transmitted or recorded communication. A notice so delivered shall be
deemed to have been sent when it is delivered personally or to the recorded
address as aforesaid; a notice so mailed shall be deemed to have been sent when
deposited in a post office or public letter box and shall be deemed to have been
received on the fifth day after so depositing; and a notice so sent by any means
of transmitted or recorded communication shall be deemed to have been sent when
dispatched by the Corporation if it uses its own facilities and otherwise when
delivered to the appropriate communication company or agency or its
representative for dispatch. The secretary may change or cause to be changed the
recorded address of any shareholder, director, officer or auditor in accordance
with any information believed by him to be reliable. The recorded address of a
director shall be his latest address as shown in the records of the Corporation.

11.2 NOTICE TO JOINT SHAREHOLDERS. If two or more persons are registered as
joint holders of any share, any notice shall be addressed to all of such joint
holders but notice sent to one of such persons shall be sufficient notice to all
of them.

11.3 COMPUTATION OF TIME. In computing the date when notice must be sent under
any provision requiring a specified number of days notice of any meeting or
other event, both the date of sending the notice and the date of the meeting or
other event shall be excluded.

11.4 UNDELIVERED NOTICES. If any notice sent to a shareholder pursuant to
subsection 11.1 is returned on three consecutive occasions because the
shareholder cannot be found, the Corporation shall not be required to give any
further notices to such shareholder until he informs the Corporation in writing
of his new address.

11.5 OMISSIONS AND ERRORS. The accidental omission to send any notice to any
shareholder, director, officer or to the auditor or the non-receipt of any
notice by any such person or any error in any notice not affecting the substance
thereof shall not invalidate any action taken at any meeting held pursuant to
such notice or otherwise founded thereon.

11.6 PERSONS ENTITLED BY OPERATION OF LAW. Every person who, by operation of
law, transfer or by


                                      -12-

any other means whatsoever, shall become entitled to any share, shall be
bound by every notice in respect of such share which shall have been duly
sent to the shareholder from whom he derives his title to such share prior to
his name and address being entered on the securities register (whether such
notice was given before or after the happening of the event upon which he
became so entitled).

11.7 DECEASED SHAREHOLDERS. Any notice duly sent to any shareholder shall be
deemed to have been duly served in respect of the shares held by the shareholder
(whether held solely or with other persons), notwithstanding that such
shareholder is then deceased and whether or not the Corporation has notice of
his death, until some other person is entered in his stead in the securities
register of the Corporation as the holder or as one of the holder thereof and
such service shall for all purposes be deemed a sufficient service of notice to
his heirs, executors or administrators and all persons, if any, interested with
him in such shares.

11.8 WAIVER OF NOTICE. Any shareholder (or his duly appointed proxyholder),
director, officer or auditor may at any time waive any notice, or waive or
abridge the time for any notice, required to be given to him under any
provisions of the Act, the regulations thereunder, the articles, the by-laws or
otherwise and such waiver or abridgement shall cure any default in the giving or
in the time of such notice, as the case may be. Any such waiver or abridgement
shall be in writing except a waiver of notice of a meeting of shareholders or of
the board which may be given in any manner.

11.9 EXECUTION OF NOTICES. The signature of any director or officer of the
Corporation to any notice may be written, stamped, typewritten or printed or
partly written, stamped, typewritten or printed.

11.10 PROOF OF SERVICE. A certificate of any officer or director of the
Corporation in office at the time of making of the certificate or of an agent of
the Corporation as to facts in relation to the sending of any notice to any
shareholder, director, officer or auditor or publication of any notice shall be
conclusive evidence thereof and shall be binding on every shareholder, director,
officer or auditor of the Corporation, as the case may be.

      The foregoing resolution making By-law No. 1 of the Corporation, being a
by-law relating generally to the regulation of the business and affairs of the
Corporation, is hereby signed by all of the directors of the Corporation.

      DATED the 15th day of September, 1999

      /s/ Douglas W. Knight                     /s/ David Wayne Parrish
      ---------------------                     -----------------------
      Douglas W. Knight                         David Wayne Parrish

      The foregoing By-law No. 1 of the Corporation, made by all of the
directors, is hereby confirmed by the sole shareholder of the Corporation
entitled to vote at a meeting of shareholders.

      DATED the 15th day of September, 1999.



                                                       SUN MEDIA CORPORATION
                                                   Per: /s/ Paul V. Godfrey

EX-3.19

[CANADA LOGO] INDUSTRY CANADA    INDUSTRIE CANADA                  EXHIBIT 3.19


CERTIFICATE                              CERTIFICAT
OF INCORPORATION                         DE CONSTITUTION

CANADA BUSINESS                          LOI CANADIENNE SUR
CORPORATIONS ACT                         LES SOCIETES PAR ACTIONS

- -------------------------------------------------------------------------------



3351611 CANADA INC.                          335161-1


- -------------------------------------     -------------------------------------
Name of corporation-denomination de       Corporation number-Numero de la
societe                                   societe


I hereby certify that the above-named     Je certifie que la societe
corporation, the articles of              susmentionnee, dont les statuts
incorporation of which are attached,      constitutifs sont joints, a ete
was incorporated under the CANADA         constituee en societe en vertu de la
BUSINESS CORPORATIONS ACT.                LOI CANADIENNE SUR LES SOCIETES PAR
                                          ACTIONS.



     /s/ [illegible]                      March 3, 1997/le 3 mars 1997

  Director - Directeur                    Date of Incorporation - Date de
                                          constitution

- -------------------------------------------------------------------------------

[CANADA LOGO]




                               CANADA BUSINESS
                              CORPORATIONS ACT
                                   FORM 1
                          ARTICLES OF INCORPORATION
                                  (SECTION 6)
                          -------------------------


1  - NAME OF CORPORATION

          3351611     CANADA INC.

2  - THE PLACE IN CANADA WHERE THE REGISTERED OFFICE IS TO BE SITUATED

     Metropolitan Region of Montreal, Province of Quebec

3  - THE CLASSES AND ANY MAXIMUM NUMBER OF SHARES THAT THE CORPORATION IS
     AUTHORIZED TO ISSUE

     Unlimited number of common shares;
     Unlimited number of class A preferred shares; and
     Unlimited number of class B preferred shares.

I.   THE COMMON SHARES SHALL HAVE ATTACHED THERETO THE FOLLOWING RIGHTS,
     PRIVILEGES, RESTRICTIONS AND CONDITIONS:

     (a)  Each common share shall entitle the holder thereof to one (1) vote
          at all meetings of the shareholders of the Corporation (except
          meetings at which only holders of another specified class of shares
          are entitled to vote pursuant to the provisions hereof or pursuant
          to the provisions of the CANADA BUSINESS CORPORATIONS ACT
          (hereinafter referred to as the "Act")).

     (b)  The holders of the common shares shall be entitled to receive
          during each year, as and when declared by the board of directors,
          subject to the rights, privileges, restrictions and conditions
          attaching to the class A preferred shares and the class B preferred
          shares, dividends payable in money, property or by the issue of
          fully paid shares of the capital of the Corporation.


21738.  (FS03)




                                    - 2 -

    (c)  In the event of the liquidation, dissolution or winding-up of the
         Corporation, whether voluntary or involuntary, or other distribution
         of assets of the Corporation among shareholders for the purpose of
         winding-up its affairs, subject to the rights, privileges,
         restrictions and conditions attaching to the class A preferred
         shares and the class B preferred shares, the holders of the common
         shares shall be entitled to receive the remaining property of the
         Corporation.

II.      THE CLASS A PREFERRED SHARES SHALL HAVE ATTACHED THERETO THE
         FOLLOWING RIGHTS, PRIVILEGES, RESTRICTIONS AND CONDITONS:

    (a)  Subject to the provisions of the Act or as otherwise expressly
         provided herin, the holders of the class A preferred shares shall
         not be entitled to receive notice of, nor to attend or vote at
         meetings of the shareholders of the Corporation.

    (b)  The holders of the class A preferred shares shall be entitled to
         receive, during each year, as and when declared by the board of
         directors, but always in preference and priority to any payment of
         dividends  on the class B preferred shares, the common shares or any
         other shares ranking junior to the class A preferred shares,
         non-cumulative dividends at a rate ranging between 0% and 10% per
         annum calculated on the class A prefered redemption price (as
         hereinafter defined in paragraph II. (h)) of each such share payable
         in money, property  or by the issue of fully paid shares of any
         class of the Corporation. The holders of the class A preferred shares
         shall not be entitled to any dividend in excess of the dividend
         hereinbefore provided for.

    (c)  In the event of the liquidation, dissolution or winding-up of the
         Corporation, whether voluntary or involuntary, or other distribution
         of assets of the Corporation among shareholders for the purpose of
         winding-up its affairs, the holders of the class A preferred shares
         shall be entitled to receive for each class A preferred share, in
         preference and priority to any distribution of the property or
         assets of the Corporation to the holders of the class B preferred
         shares, the common shares or any other shares ranking junior to the
         class A preferred shares, an amount equal to the class A preferred
         redemption price plus all declared and unpaid dividends thereon, but
         shall not be entitled to share any further in the distribution of
         the property or assets of the Corporation.




                                    - 3 -

    (d)  The Corporation may, in the manner hereinafter provided, redeem at
         any time all, or from time to time any part, of the outstanding
         class A preferred shares on payment of the class A preferred
         redempton price for each class A preferred share to be redeemed,
         plus all declared and unpaid dividends thereon (for purposes of
         paragraphs II. (e), (f) and (g), the "redemption price").

    (e)  Before redeeming any class A preferred shares, the Corporation shall
         mail or deliver to each person who, at the date of such mailing or
         delivery, shall be a registered holder of class A preferred shares
         to be redeemed, notice of the intention  of the Corporation to
         redeem such shares held by such registered holder; such notice
         shall be delivered to, or mailed by ordinary prepaid post addressed
         to, the last address of such holder as it appears on the records of
         the Corporation, or in the event of the address of any such holder
         not appearing on the records of the Corporation, then to the last
         address  of such holder known to the Corporation, at least one (1)
         day before the date specified for redemption; such notice shall set
         out the redemption price, the date on which the redemption is to
         take place and, if part only of the class A preferred shares held
         by the person to whom it is addressed is to be redeemed, the number
         thereof to be so redeemed; on or after the date so specified for
         redemption, the Corporation shall pay or cause to be paid the
         redemption price to the registered holders of the class A preferred
         shares to be redeemed, the whole on presentation and surrender of
         the certificates for the class A preferred shares so called for
         redemption at the registered office of the Corporation or at such
         other place or places and may be specified in such notice, and the
         certificates for such class A preferred shares shall thereupon be
         cancelled, and the class A preferred shares represented thereby
         shall thereupon be redeemed; from and after the date specified for
         redemption in such notice, the holders of the class A preferred
         shares called for redemption shall cease to be entitled to
         dividends in respect of such shares and shall not be entitled to
         exercise any of the rights of the holders thereof, except the right
         to receive the redemption price, unless payment of the redemption
         price shall not be made by the Corporation in accordance with the
         foregoing provisions, in which case the rights of the holders of
         such shares shall remain unaffected; on or before the date
         specified for redemption, the corporation shall have the right to
         deposit the redemption price of the class A preferred shares called
         for redemption in a special account with any chartered bank or
         trust company in Canada named in the notice of redemption, to be
         paid without interest, to or to the order of the respective holders
         of such class



                                    - 4 -

         A preferred shares called for redemption, the whole upon
         presentation and surrender of the certificates representing the same
         and, upon such deposit being made or upon the date specified for
         redemption, whichever is later, the class A preferred shares in
         respect whereof such deposit shall have been made, shall be deemed
         to be redeemed and the rights of the respective holders thereof,
         after such deposit or after such redemption date, as the case may,
         shall be limited to receiving, out of the moneys so deposited,
         without interest, the redemption price applicable to their
         respective class A preferred shares, the whole against presentation
         and surrender of the certificates representing such class A
         preferred shares. If less than all the class A preferred shares are
         to be redeemed, the shares to be redeemed shall be redeemed pro
         rata, disregarding fractions, unless the holders of the class A
         preferred shares unanimously agree to the adoption of another method
         of selection of the class A preferred shares to be redeemed. If less
         than all the class A preferred shares represented by any certificate
         be redeemed, a new certificate for the balance shall be issued.

    (f)  A holder of class A preferred shares shall be entitled to require
         the Corporation to redeem at any time all, or from time to time
         any part, of class A preferred shares registered in the name of such
         holder by tendering to the Corporation, at its registered office,
         the share certificate(s)  representing the class A preferred shares
         which  the registered holder desires to have the Corporation redeem,
         which share certificates shall be accompanied by a request in
         writing specifying (i) the number of class A preferred shares which
         the registered holder desires to have redeemed by the Corporation and
         (ii) the business day (in this paragraph referred to as the
         "redemption date")  on which the holder desires to have the
         Corporation redeem such class A preferred shares, which redemption
         date shall not be less than five (5) days after the day on which the
         said request in writing is given to the Corporation. Upon receipt of
         the share certificate(s)  representing the class A Preferred shares
         which the registed holder desires to have the Corporation redeem,
         together with the said written request, the Corporation shall on, or
         at its option, before, the redemption date redeem such class A
         preferred shares by paying to the registered holder thereof, for
         each share to be redeemed, an amount equal to the redemtion price in
         respect thereof; such payment shall be made by cheque payable at par
         at any branch of the Corporation's bankers for the time being in
         Canada. The said class A preferred shares shall be deemed to be
         redeemed on the date of payment of the redemption price and, from
         and after such date,



                                    - 5 -

         such class A preferred shares shall cease to be entitled to
         dividends and the holders thereof shall not be entitled to exercise
         any of the rights of the holders of class A preferred shares in
         respect thereof. Notwithstanding the foregoing, the Corporation
         shall only be obliged to redeem class A preferred shares so tendered
         for redemption to the extent that such redemption would not be
         contrary to any applicable law, and if such redemption of any such
         class A preferred shares would be contrary to any applicable law,
         the Corporation shall only be obliged to redeem such class A
         preferred shares to the extent that the moneys applied thereto
         shall be such amount (rounded to the next lower multiple of one
         hundred dollars ($100.00)) as would not be contrary to such law, in
         which case the Corporation shall pay to each holder his pro rata
         share of the purchase moneys so allocated. If less than all the class
         A preferred shares represented by any certificate be redeemed, a new
         certificate for the balance shall be issued.

    (g)  The Corporation may purchase for cancellation at any time all, or
         from time to time any part, of the class A preferred shares
         outstanding, by private contract at any price, with the unanimous
         consent of the holders of the class A preferred shares then
         outstanding, or by invitation for tenders addressed to all the
         holders of the class A preferred shares a the lowest price at which,
         in the opinion of the directors, such shares are obtainable but not
         exceeding the redemption price thereof. If less than all the class A
         preferred shares represented by any certificate be purchased for
         cancellation, a new certificate for the balance shall be issued.

    (h)  For the purposes of the foregoing paragraphs II. (b), (c) and (d),
         the "class A preferred redemption price" of each class A preferred
         share shall be an amount equal to (i) the monetary consideration
         received by the Corporation upon the issuance of such share
         (denominated in the currency in which such consideration was paid to
         the Corporation), if such share has been issued for money; or (ii)
         the fair market value of the consideration received by the
         Corporation (including, without limitation, shares of another class
         of the Corporation) upon the issuance of such share, if such share
         has been issued for a consideration other than money. Subject to the
         provisions of the following sub-paragraph, such fair market value is
         to be determined  by the directors on the basis of generally
         accepted accounting and evaluation principles.



                                      - 6 -

         The fair market value determined as hereinabove provided for shall
         be subject to revision in accordance with any binding agreement
         with, or decision by, the appropriate taxation authorities, or any
         judgment of a court of competent jurisdiction. In the event that any
         such agreement, decision or judgment shall result in a final
         determination under the provisions of the appropriate taxation
         legislation and the amount thereby determined is an amount other
         than the amount for which such share was originally issued as
         determined by the directors in accordance with the preceding
         subparagraph, such finally determined amount for the purpose of the
         appropriate taxation legislation shall then be deemed to have been
         the fair market value of the consideration received by the
         Corporation  upon the issuance of such class A preferred share. Such
         final determination shall reflect any assessment by the Minister of
         National Revenue or other taxing authority to which no appeal is
         taken or any agreement reached by the Corporation or any holder of a
         class A preferred share and a said taxing authority in settlement of
         a dispute regarding such assessment or proposed assessment, or any
         decision by a court or tribunal of competent jurisdiction regarding
         the fair market value of the class A preferred share or the
         consideration received by the Corporation upon the issuance of such
         class A preferred share to which no appeal may be taken or the
         period during which an appeal may be taken has expired.

         In the event that, subsequent to any redemption of class A preferred
         shares, the class A preferred redemption price of each class A
         preferred share is adjusted pursuant to a revision of fair market
         value as aforementioned, either the Corporation shall pay out to the
         former holders of such redeemed class A preferred shares or the said
         former holders of the redeemed class A preferred shares will
         reimburse the Corporation as the case may be, the difference between
         the class A preferred redemption price of the said class A preferred
         shares as adjusted and the amount paid by the Corporation upon
         redemption, within sixty (60) days from the date of adjustment of
         the class A preferred redemption price.

    (i)  In the event that only part of the amount of the consideration
         received by the Corporation for any class A preferred shares issued
         by the Corporation is added to the stated capital account of the
         class A preferred shares, such class A preferred shares shall be
         deemded to have been issued for the full amount of the consideration
         received, for all purposes of the articles (except only with respect
         to the stated capital




                                    - 7 -

         of such class A preferred shares) including, but without limiting
         the generality of the foregoing, dividend rights, redemption rights
         and rights upon liquidation and dissolution.

    (j)  No change to any of the provisions of paragraphs II. (a) to (i) or
         of this paragraph (j) shall have any force or effect until it has
         been approved by a majority of not less than two-thirds (2/3) of the
         votes cast by the holders of the class A preferred shares, voting
         separately as a class at a meeting of such holders specially called
         for that purpose, or by a resolution in writing signed by all the
         holders of the class A preferred shares in addition to any other
         approval required by the Act.

III.     THE CLASS B PREFERRED SHARES SHALL HAVE ATTACHED THERETO THE
         FOLLOWING RIGHTS, PRIVILEGES, RESTRICTIONS AND CONDITIONS:

    (a)  Subject to the provisions of the Act or as otherwise expressly
         provided herein, the holders of the class B preferred shares shall
         not be entitled to receive notice of, nor to attend or vote at
         meetings of the shareholders of the Corporation.

    (b)  The holders of the class B preferred shares shall be entitled to
         receive, during each year, as and when declared by the board of
         directors, but always in preference and priority to any payment of
         dividends on the common shares or any other shares ranking junior to
         the class B preferred shares, but after payment of dividends to the
         holders of the class A preferred shares, non-cumulative dividends
         at a rate ranging between 0% and 10% per annum calculated on the
         class B preferred redemption price (as hereinafter defined in
         paaragraph III. (h)) of each such share payable in money, property
         or by the issue of fully paid shares of any class of the
         Corporation. The holders of the class B preferred shares shall not
         be entitled to any dividend in excess of the dividend hereinbefore
         provided for.

    (c)  In the event of the liquidation, dissolution or winding-up of the
         Corporation, whether voluntary or involuntary, or other distribution
         of assets of the Coroporation among shareholders for the purpose of
         winding-up its affairs, the holders of the class B preferred shares
         shall be entitled to receive for each class B preferred share, in
         preference and priority  to any distribution of the property or
         assets of the Corporation to the holders of the common shares or
         any other shares ranking junior to



                                        - 8 -


         the class B preferred shares, but after distribution to the holders
         of the the class A preferred shares, an amount equal to the class B
         preferred redemption price plus all declared and unpaid dividends
         theron, but shall not be entitled to share any further in the
         distribution of the property or assets of the Corporation.

    (d)  The Corporation may, in the manner hereinafter provided, redeem at
         any time all, or from time to time any part, of the outstanding
         class B preferred shares on payment of the class B preferred
         redemption price for each class B preferred share to be redeemed,
         plus all declared and unpaid dividends thereon (for purposes of
         paragraphs III. (e), (f) and (g), the "redemption price").

    (e)  Before redeeming any class B preferred shares, the Corporation shall
         mall or deliver to each person who, at the date of such mailing or
         delivery, shall be a registered holder of class B preferred shares
         to be redeemed, notice of the intention of the Corporation to redeem
         such shares held by such registered holder; such notice shall be
         delivered to, or mailed by ordinary prepaid post addressed to, the
         last address of such holder as it appears  on the records of the
         Corporation, or in the event of the address of any such holder not
         appearing on the records of the Corporation, then to the last
         address of such holder known to the Corporation, at least one (1)
         day before the date specified for redemption; such notice shall set
         out the redemption price, the date on which the redemption is to
         take place and, if part only of the class B preferred shares held by
         the person to whom it is addressed is to be redeemed, the number
         thereof to be so redeemed; on or after the date so specified for
         redemption, the Corporation shall pay or cause to be paid the
         redemption price to the registered holders of the class B preferred
         shares to be redeemed, the whole on presentation and surrender of
         the certificates for the class B preferred shares so called for
         redemption at the registered office of the Corporation or at such
         other place or places as may be specified in such notice, and the
         certificates for such class B preferred shares shall thereupon be
         cancelled, and the class B preferred shares represendted thereby
         shall thereupon be redeemed; from and after the date specified for
         redemption in such notice, the holders of the class B preferred
         shares called for redemption shall cease to be entitled to dividends
         in respect of such shares and shall not be entitled to exercise any
         of the rights of the holders therof, except the right to receive the
         redemption price, unless payment of the redemption price shall not
         be made by the Corporation in accordance with the foregoing
         provisions, in which case the rights of



                                    - 9 -

         the holders of such shares shall remain unaffected; on or before the
         date specified for redemption, the Corporation shall have the right
         to deposit the redemption price of the class B preferred shares
         called for redemption in a specified account with any chartered
         bank or trust company in Canada named in the notice of redemption,
         to be paid, without interest, to or to the order of the respective
         holders of such class B preferred shares called for redemption, the
         whole upon presentation and surrender of the certificates
         representing the same and, upon such deposit being made or upon the
         date specified for redemption, whichever is later, the class B
         preferred shares in respect whereof such deposit shall have been
         made, shall be deemed to be redeemed and the rights of the
         respective holders thereof, after such deposit or after such
         redemption date, as the case may be, shall be limited to receiving,
         out of the moneys so deposited, without interest, the redemption
         price applicable to their respective class B preferred shares, the
         whole against presentation and surrender of the certificates
         representing such class B preferred shares. If less than all the
         class B preferred shares are to be redeemed, the shares to be
         redeemed shall be redeemed pro rata, disregarding fractions, unless
         the holders of the class B preferred shares unanimously agree to
         the adoption of another method of selection of the class B
         preferred shares to be redeemed. If less than all the class B
         preferred shares represented by any certificate be redeemed, a new
         certificate for the balance shall be issued.

    (f)  A holder of class B preferred shares shall be entitled to require
         the Corporation to redeem at any time all, or from time to time any
         part, of the class B preferred shares registered in the name of
         such holder by tendering to the Corporation, at its registered
         office, the share certificate(s) representing the class B preferred
         shares which the registered holder desires to have the Corporation
         redeem, which share certificates shall be accompanied by a request
         in writing specifying (i) the number of class B preferred shares
         which the registered holder desires to have redeemed by the
         Corporation and (ii) the business day (in this paragraph referred
         to as the "redemption date") on which the holder desires to have
         the Corporation redeem such class B preferred shares, which
         redemption date shall not be less than five (5) days after the day
         on which the said request in writing is given to the Corporation.
         Upon receipt of the share certificate(s) representing the class B
         preferred shares which the registered holder desires to have the
         Corporation redeem, together with the said written request, the
         Corporation shall on, or at its option, before, the redemption date
         redeem such class B



                                    - 10 -

          preferred shares by paying to the registered holder thereof, for
          each share to be redeemed, an amount equal to the redemption price
          in respect thereof; such payment shall be made by cheque payable at
          par at any branch of the Corporation's bankers for the time being
          in Canada. The said class B preferred shares shall be deemed to be
          redeemed on the date of payment of the redemption price and, from
          and after such date, such class B preferred shares cease to be
          entitled to dividends and the holders thereof shall not be entitled
          to exercise any of the rights of the holders of class B preferred
          shares in respect thereof. Notwithstanding the foregoing, the
          Corporation shall only be obliged to redeem class B preferred
          shares so tendered for redemption to the extent that such
          redemption would not be contrary to any applicable law, and if such
          redemption of any such class B preferred shares would be contrary
          to any applicable law, the Corporation shall only be obliged to
          redeem such class B preferred shares to the extent that the moneys
          applied thereto shall be such amount (rounded to the next lower
          multiple of one hundred dollars ($100.00)) as would not be contrary
          to such law, in which case the Corporation shall pay to each holder
          his pro rata share of the purchase moneys so allocated. If less
          than all of the class B preferred shares represented by any
          certificate be redeemed, a new certificate for the balance shall be
          issued.

     (g)  The Corporation may purchase for cancellation at any time all, or
          from time to time any part, of the class B preferred shares
          outstanding, by private contract at any price, with the unanimous
          consent of the holders of the class B preferred shares then
          outstanding, or by invitation for tenders addressed to all the
          holders of the class B preferred shares at the lowest price at
          which, in the opinion of the directors, such shares are obtainable
          but not exceeding the redemption price thereof. If less than all
          the class B preferred shares represented by any certificate be
          purchased for cancellation, a new certificate for the balance shall
          be issued.

     (h)  For the purposes of the foregoing paragraphs III. (b) and (d), the
          "class B  preferred redemption price" of each class B preferred
          share shall be an amount equal to (i) the monetary consideration
          received by the Corporation upon the issuance of such share
          (denominated in the currency in which such consideration was paid
          to the Corporation), if such share has been issued for money; or
          (ii) the fair market value of the consideration received by the
          Corporation (including, without limitation, shares of another class
          of the Corporation) upon the issuance of such



                                    - 11 -

          share, if such share has been issued for a consideration other than
          money. Subject to the provisions of the following sub-paragraph,
          such fair market value is to be determined by the directors on the
          basis of generally accepted accounting and valuation principles.

          The fair market value determined as hereinabove provided for shall
          be subject to revision in accordance with any binding agreement
          with, or decision by, the appropriate taxation authorities, or any
          judgment of a court of competent jurisdiction. In the event that
          any such agreement, decision or judgment shall result in a final
          determination under the provisions of the appropriate taxation
          legislation and the amount thereby determined is an amount other
          than the amount for which such share was originally issued as
          determined by the directors in accordance with the preceding
          subparagraph, such finally determined amount for the purpose of the
          appropriate taxation legislation shall then be deemed to have been
          the fair market value of the consideration received by the
          Corporation upon the issuance of such class B preferred share. Such
          final determination shall reflect any assessment by the Minister of
          National Revenue or other taxing authority to which no appeal is
          taken or any agreement reached by the Corporation or any holder of
          a class B preferred share and a said taxing authority in settlement
          of a dispute regarding such assessment or proposed assessment, or
          any decision by a court or tribunal of competent jurisdiction
          regarding the fair market value of the class B preferred share or
          the consideration received by the Corporation upon the issuance of
          such class B preferred share to which no appeal may be taken or the
          period during which an appeal may be taken has expired.

          In the event that, subsequent to any redemption of class B
          preferred shares, the class B preferred redemption price of each
          class B preferred share is adjusted pursuant to a revision of fair
          market value as aforementioned, either the Corporation shall pay
          out to the former holders of such redeemed class B preferred shares
          or the said former holders of the redeemed class B preferred shares
          will reimburse the Corporation as the case may be, the difference
          between the class B preferred redemption price of the said class B
          preferred shares as adjusted and the amount paid by the Corporation
          upon redemption, within sixty (60) days from the date of adjustment
          of the class B preferred redemption price.




                                    - 12 -


     (i)  in the event that only part of the amount of the consideration
          received by the Corporation for any class B preferred share
          issued by the Corporation is added to the stated capital
          account of the class B preferred shares, such class B
          preferred share shall be deemed to have been issued for the
          full amount of the consideration received, for all purposes of
          these articles (except only with respect to the stated capital
          of such class B preferred shares) including, but without
          limiting the generality of the foregoing, dividend rights,
          redemption rights and rights upon liquidation and dissolution.

     (j)  No change to any of the provisions of paragraphs III. (a) to
          (i) or of this paragraph (j) shall have any force or effect
          until it has been approved by a majority of not less than
          two-thirds (2/3) of the votes cast by the holders of the class
          B preferred shares, voting separately as a class at a meeting
          of such holders specially called for that purpose, or by a
          resolution in writing signed by all the holders of the class B
          preferred shares, in addition to any other approval required
          by the Act.

4.        RESTRICTIONS IF ANY ON SHARE TRANSFERS

          No share in the share capital of the Corporation shall be
          transferred nor shall it be assigned without the approval of the
          directors certified by a resolution of the board of directors.

5.        NUMBER (OR MINIMUM AND MAXIMUM NUMBER) OF DIRECTORS

          A minimum of one (1) director and a maximum of ten (10) directors.


6.        RESTRICTIONS IF ANY ON BUSINESS THE CORPORATION MAY CARRY ON

          None.


7.        OTHER PROVISIONS IF ANY

          (1)  the number of the shareholders of the Corporation is limited
               to fifty (50) exclusive of present or former employees of the
               Corporation or of a



                                    - 13 -

          subsidiary of the Corporation, two or more persons holding one or
          more shares jointly being counted as a single shareholder;

     (2)  any distribution of securities to the public or invitation to the
          public to subscribe for the Corporation's securities is prohibited;
          and

     (3)  the directors may appoint one or more directors, who shall hold
          office for a term expiring not later than the close of the next
          annual meeting of shareholders, but the total number of directors
          so appointed may not exceed one third of the number of directors
          elected at the previous annual meeting of shareholders.

8.   INCORPORATORS



     NAME                       ADDRESS

                             
     Sylvie Bordet              1155 Rene-Levesque Boulevard West
                                40th Floor
                                Montreal, Quebec
                                H3B 3V2



SIGNATURE

/s/ Sylvie Bordet
- ------------------------
Sylvie Bordet



- -------------------------------------------------------------------------------
                         FOR DEPARTMENTAL USE ONLY

Corporation No. 335161-1                         Filed Mar-4 1997

EX-3.20

                                                                   EXHIBIT 3-20


                             3351611 CANADA INC.
                             -------------------

                               BY-LAW NO. ONE
                               --------------




                                                         Article           Page
                                                         -------           ----
                                                                     
DEFINITIONS..........................................       1                1
     Act.............................................       1                1
     articles........................................       1                1
     by-law..........................................       1                2
     unanimous shareholder agreement.................       1                2
REGISTERED OFFICE....................................       2                2
CORPORATE SEAL.......................................       3                2
DIRECTORS............................................                        3
     Number and Powers...............................       4                3
     Vacancies.......................................       5                3
     Term of Office..................................       6                3
     Vacation of Office..............................       7                3
     Election........................................       8                4
MEETINGS OF DIRECTORS................................                        4
     Place of Meeting................................       9                4
     Notice..........................................       9                4
     Waiver of Notice................................       9                5
     Telephone Participation.........................       9                5
     Adjournment.....................................      10                5
     Quorum and Voting...............................      11                5
     Resolution in lieu of meeting...................      12                6
REMUNERATION OF DIRECTORS............................      13                6
SUBMISSION OF CONTRACTS OR TRANSACTIONS
TO SHAREHOLDERS FOR APPROVAL.........................      14                6





                                                         Article           Page
                                                         -------           ----
                                                                     
INDEMNITIES TO DIRECTORS AND OTHERS..................      15                7
OFFICERS.............................................                        7
     Appointment of Officers.........................      16                7
     Remuneration and Removal of Officers............      17                8
     Duties of Officers may be Delegated.............      18                8
     Chairman of the Board...........................      19                8
     President.......................................      20                8
     Vice-President..................................      21                8
     Secretary.......................................      22                9
     Treasurer.......................................      23                9
     Assistant Secretary and Assistant Treasurer.....      24                9
MANAGING DIRECTOR....................................      25               10
COMMITTEES...........................................      26               10
SHAREHOLDERS' MEETINGS...............................                       10
     Annual Meeting..................................      27               10
     Special Meetings................................      28               10
     Place of Meetings...............................      29               11
     Notice..........................................      30               11
     Omission of Notice..............................      31               11
     Record Date.....................................      32               12
     Votes...........................................      33               12
     Proxies.........................................      34               13
     Adjournment.....................................      35               15
     Quorum..........................................      36               15
     Resolution in lieu of meeting...................      37               16
SECURITIES...........................................                       16





                                                         Article           Page
                                                         -------           ----
                                                                     
     Certificates....................................      38               16
     Registrar and Transfer Agent....................      39               16
     Surrender of Share Certificates.................      40               17
     Defaced, Destroyed, Stolen or Lost Certificates.      41               17
DIVIDENDS............................................      42               17
NOTICE...............................................                       18
     Shares registered in more than one name.........      43               18
     Persons becoming entitled by operation of law...      44               18
     Deceased Shareholder............................      45               18
     Signatures to Notices...........................      46               18
     Computation of Time.............................      47               18
     Proof of Service................................      48               19
CHEQUES, DRAFTS, NOTES, ETC..........................      49               19
CUSTODY OF SECURITIES................................      50               19
EXECUTION OF CONTRACTS, ETC..........................      51               19
DECLARATIONS.........................................      52               21
FISCAL YEAR..........................................      53               22



              ----------------------------------------------------
                                   RESOLUTION
                            OF THE BOARD OF DIRECTORS
                                      OF
                              3351611 CANADA INC.
              ----------------------------------------------------

RESOLVED:

           THAT the following by-law be and the same is hereby adopted:

                                ---------------
                                 BY-LAW NO. ONE
                                ---------------

          being a by-law relating generally to the transaction of
          the business and affairs of the Corporation.


     BE IT ADOPTED as BY-LAW NO. ONE of 3351611 CANADA INC.
(hereinafter referred to as the "Corporation"):

DEFINITIONS
- -----------

1.   In this by-law and all other by-laws of the Corporation, unless the
context otherwise specifies or requires:

     (a)  "ACT" means the CANADA BUSINESS CORPORATIONS ACT, R.S.C., 1985,
          chapter C-44, and any statute that may be substituted therefor,
          as from time to time amended;

     (b)  "ARTICLES" means the articles of the Corporation, as from time
          to time amended or restated;

     (c)  "BY-LAW" means this by-law and all other by-laws of the
          Corporation from time to time in force and effect;



                                     -2-

     (d)  "UNANIMOUS SHAREHOLDERS AGREEMENT" means an agreement as
          described in subsection 146(2) of the Act made by the
          shareholders of the Corporation;

     (e)  words importing the singular number only shall include the
          plural and vice versa; words importing the masculine gender
          shall include the feminine and neuter genders and vice versa;
          words importing persons shall include bodies corporate,
          corporations, companies, partnerships, syndicates, trusts and
          any number or aggregate of individuals;

     (f)  the headings used in the by-laws are inserted for reference
          purposes only and are not to be considered or taken into account
          in construing the terms or provisions thereof or to be deemed in
          any way to clarify, modify or explain the effect of any such terms
          or provisions; and

     (g)  all terms contained in the by-laws and which are defined in the
          Act shall have the meanings given to such terms in the Act.

REGISTERED OFFICE
- -----------------

2.   The Corporation may from time to time (i) by resolution of the board of
directors change the location of the address of the registered office of the
Corporation within the place specified in the articles and (ii) by articles
of amendment change the place in which its registered office is situated to
another place within Canada.

CORPORATE SEAL
- --------------

3.   The Corporation may have one or more corporate seals which shall be such
as the board of directors may by resolution from time to time adopt and
change.


                                     -3-

DIRECTORS
- ---------

4.   NUMBER AND POWERS. There shall be a board of directors consisting of
such fixed number, or minimum and maximum number of directors as may be set
out in the articles, but a Corporation, any of the issued securities of which
are or were part of a distribution to the public and remain outstanding and
are held by more than one person, shall not have fewer than three (3)
directors, at least two (2) of whom are not officers or employees of the
Corporation or its affiliates. A majority of the board of directors must be
resident Canadians unless the Corporation is a holding Corporation referred
to in subsection 105(4) of the Act.

5.   VACANCIES. If the number of directors is increased, the resulting
vacancies shall be filled at a meeting of shareholders duly called for that
purpose. Notwithstanding the provisions of this by-law and subject to the
provisions of the Act, if a vacancy should otherwise occur in the board, the
remaining directors, if constituting a quorum, may appoint a qualified person
to fill the vacancy for the remainder of the term. In the absence of a
quorum, the remaining directors shall forthwith call a meeting of
shareholders to fill the vacancy pursuant to subsection 111(2) of the Act.
Where a vacancy or vacancies exist in the board, the remaining directors may
exercise all of the powers of the board so long as a quorum remains in office.

6.   TERM OF OFFICE. A director's term of office shall be from the meeting at
which he is elected or appointed until the annual meeting next following or
until his successor is elected or appointed, or until, if earlier, he dies or
resigns, or is removed or disqualified pursuant to the provisions of the Act.

7.   VACATION OF OFFICE. The office of a director shall ipso facto be vacated
if:

     (a)  he dies;

     (b)  by notice in writing to the Corporation he resigns his office
          and such resignation, if not effective immediately, becomes
          effective in accordance with its terms;

     (c)  he is removed from office in accordance with section 109 of the
          Act; or


                                     -4-

     (d)  he ceases to be qualified to be a director.

8.   ELECTION. Directors shall be elected by the shareholders by ordinary
resolution in a general meeting on show of hands unless a poll is demanded
and if a poll is demanded such election shall be by ballot.

     A retiring director shall retain office until the adjournment or
termination of the meeting at which his successor is elected unless such
meeting was called for the purpose of removing him from office as a director
in which case the director so removed shall vacate office forthwith upon the
passing of the resolution for his removal.

MEETINGS OF DIRECTORS
- ---------------------

9.   PLACE OF MEETING. Subject to the articles, meetings of directors may be
held at any place within or outside Canada as the directors may from time to
time determine or the person convening the meeting may give notice. A meeting
of the board of directors may be convened by the chairman of the board, if
any, the president if any, or any director at any time. The secretary, if
any, shall upon direction of any of the foregoing convene a meeting of the
board of directors.

     NOTICE. Notice of the time and place for the holding of any such meeting
shall be delivered, mailed, telegraphed, cabled or telexed to each director
at his latest address as shown on the records of the Corporation not less
than two (2) days (exclusive of the day on which the notice is delivered,
mailed, telegraphed, cabled or telexed but inclusive of the day for which
notice is given) before the date of the meeting; provided that meetings of
the board of directors may be held at any time without notice if all the
directors have waived notice.

     For the first meeting of the board of directors to be held immediately
following the election of directors at an annual or special meeting of the
shareholders, no notice of such meeting need be given to the newly elected or
appointed director or directors in order for the meeting to be duly
constituted, provided a quorum of the dirctors is present.

     A notice of a meeting of directors shall specify any matter referred to
in subsection 115(3) of the Act that is to be dealt with at the meeting.


                                     -5-

     WAIVER OF NOTICE. Notice of any meeting of the board of directors or any
irregularity in any meeting or in the notice thereof may be waived by any
director in writing or by telegram, cable or telex addressed to the
Corporation or in any other manner, and such waiver may be validly given
either before or after the meeting to which such waiver relates. The
attendance of a director at a meeting of directors is a waiver of notice of
the meeting except where a director attends a meeting for the express purpose
of objecting to the transaction of any business on the grounds that the
meeting is not lawfully called.

     TELEPHONE PARTICIPATION. A director may, if all the directors of the
Corporation consent thereto (either before, during or after the meeting),
participate in a meeting of directors by means of such telephone or other
communications facilities as permit all persons participating in the meeting
to hear each other, and a director participating in such a meeting by such
means shall be deemed to be present at that meeting.

10.  ADJOURNMENT. Any meeting of the board of directors may be adjourned from
time to time by the chairman of the meeting, with the consent of the meeting,
to a fixed time and place and no notice of the time and place for the
continuance of the adjourned meeting need be given to any director. Any
adjourned meeting shall be duly constituted if held in accordance with the
terms of the adjournment and a quorum present thereat. The directors who
formed a quorum at the original meeting are not required to form the quorum
at the adjourned meeting. If there is no quorum present at the adjourned
meeting, the original meeting shall be deemed to have terminated forthwith
after its adjournment.

11.  QUORUM AND VOTING. Subject to the articles, a majority of the number of
directors in office at the time shall constitute a quorum for the transaction
of business. Subject to subsection 117(1) of the Act, no business shall be
transacted by the directors except at a meeting of directors at which a
quorum of the board is present. Questions arising at any meeting of the board
of directors shall be decided by a majority of votes cast. In case of an
equality of votes, the chairman of the meeting, in addition to his original
vote shall not have a second or casting vote. Where the Corporation has only
one director, that director may constitute the meeting.


                                     -6-

12.  RESOLUTION IN LIEU OF MEETING. A resolution in writing, signed by all
the directors entitled to vote on that resolution at a meeting of directors,
is as valid as if it had been passed at a meeting of directors or committee
of directors.

     A copy of every such resolution shall be kept with the minutes of the
proceedings of the directors or committee of directors.

REMUNERATION OF DIRECTORS
- -------------------------

13.  Subject to the articles or any unanimous shareholders agreement, the
remuneration to be paid to the directors shall be such as the board of
directors shall from time to time determine and such remuneration shall be in
addition to the salary paid to any officer of the Corporation who is also a
member of the board of directors. The directors may also by resolution award
special remuneration to any director undertaking any special services on the
Corporation's behalf other than the routine work ordinarily required of a
director by the Corporation. The confirmation of any such resolution or
resolutions by the shareholders shall not be required. The directors shall
also be entitled to be paid their travelling and other expenses properly
incurred by them in connection with the affairs of the Corporation.

SUBMISSION OF CONTRACTS OR TRANSACTIONS TO SHAREHOLDERS FOR APPROVAL
- --------------------------------------------------------------------

14.  The board of directors in their discretion may submit any contract, act
or transaction for approval, ratification or confirmation at any annual
meeting of the shareholders or at any special meeting of the shareholders
called for the purpose of considering the same and any contract, act or
transaction that shall be approved, ratified or confirmed by resolution
passed by a majority of the votes cast at any such meeting (unless any
different or additional requirement is imposed by the Act or by the
Corporation's articles or any other by-law) shall be as valid and as binding
upon the Corporation and upon all the shareholders as though it had been
approved, ratified or confirmed by every shareholder of the Corporation.



                                     -7-

INDEMNITIES TO DIRECTORS AND OTHERS
- -----------------------------------

15.  Except in respect of an action by or on behalf of the Corporation or
another body corporate (as hereinafter defined), the Corporation shall
indemnify each director and officer of the Corporation and each former
director and officer of the Corporation and each person who acts or acted at
the Corporation's request as a director or officer of another body corporate,
and his heirs and legal representatives, against all costs, charges and
expenses, including any amount paid to settle an action or satisfy a
judgment, reasonably incurred by him in respect of any civil, criminal or
administrative action or proceeding to which he is made a party by reason of
being or having been a director or officer of the Corporation or another body
corporate, as the case may be, if

     (a)  he acted honestly and in good faith with a view to the best
          interests of the Corporation; and

     (b)  in the case of a criminal or administrative action or proceeding
          that is enforced by a monetary penalty, he had reasonable grounds for
          believing that his conduct was lawful.

"another body corporate" as used herein means a body corporate of which the
Corporation is or was a shareholder or creditor.

OFFICERS
- --------

16.  APPOINTMENT OF OFFICERS. Subject to the articles or any unanimous
shareholders agreement, the board of directors, annually or as often as may
be required, may appoint from among themselves a chairman of the board and
may appoint a president and a secretary and, if deemed advisable, may also
appoint one or more vice-presidents, a treasurer and one or more assistant
secretaries and/or one or more assistant treasurers. None of such officers,
except the chairman of the board, need be a director of the Corporation. Any
two (2) or more of such offices may be held by the same person. In case and
whenever the same person holds the offices of secretary and treasurer he may,
but need not, be known as the secretary-treasurer. The board of directors may
from time to time designate such other offices and appoint such other
officers, employees and agents as it shall deem necessary who shall have such
authority and shall perform such functions and duties, as may from time to
time be prescribed by resolution of the board of directors.



                                     -8-

17.  REMUNERATION AND REMOVAL OF OFFICERS. Subject to the articles or any
unanimous shareholders agreement, the remuneration of all officers, employees
and agents elected or appointed by the board of directors may be determined
from time to time by resolution of the board of directors. The fact that any
officer, employee or agent is a director or shareholder of the Corporation
shall not disqualify him from receiving such remuneration as may be so
determined. The board of directors may by resolution remove any officer,
employee or agent at any time, with or without cause.

18.  DUTIES OF OFFICERS MAY BE DELEGATED. In case of the absence or inability
or refusal to act of any officer of the Corporation or for any other reason
that the board of directors may deem sufficient, the board may delegate all
or any of the powers of such officer to any other officer or to any director
for the time being.

19.  CHAIRMAN OF THE BOARD. The chairman of the board, if any, shall, if
present, preside at all meetings of the board of directors and of
shareholders. He shall sign such contracts, documents or instruments in
writing as require his signature and shall have such other powers and duties
as may from time to time be assigned to him by resolution of the board of
directors.

20.  PRESIDENT. The president, if any, shall be the chief executive officer
of the Corporation and shall exercise general supervision over the business
and affairs of the Corporation. In the absence of the chairman of the board,
if any, the president shall, when present, preside at all meetings of the
board of directors and shareholders; he shall sign such contracts, documents
or instruments in writing as require his signature and shall have such other
powers and shall perform such other duties as may from time to time be
assigned to him by resolution of the board of directors or as are incident to
his office.

21.  VICE-PRESIDENT. The vice-president or, if more than one, the
vice-presidents in order of seniority, shall be vested with all the powers
and shall perform all the duties of the president in the absence or inability
or refusal to act of the president, provided, however, that a vice-president
who is not a director shall not preside as chairman at any meeting of
shareholders. The vice-president or, if more than one, the vice-presidents in
order of seniority, shall sign such contracts, documents or instruments in
writing as require his or their signatures and shall also have such other
powers and duties as may from time to time be assigned to him or them by
resolution of the board of directors.


                                     -9-

22.  SECRETARY. The secretary, if any, shall give or cause to be given
notices for all meetings of the board of directors, of committees thereof, if
any, and of shareholders when directed to do so and shall have charge,
subject to the provisions of this by-law, of the records referred to in
section 20 of the Act (except the accounting records) and of the corporate
seal or seals, if any. He shall sign such contracts, documents or instruments
in writing as require his signature and shall have such other powers and
duties as may from time to time be assigned to him by resolution of the board
of directors or as are incident to his office.

23.  TREASURER. Subject to the provisions of any resolution of the board of
directors, the treasurer, if any, shall have the care and custody of all the
funds and securities of the Corporation and shall deposit the same in the
name of the Corporation in such bank or banks or with such other depositary
or depositaries as the board of directors may by resolution direct. He shall
prepare, maintain and keep or cause to be kept adequate books of accounts and
accounting records. He shall sign such contracts, documents or instruments in
writing as require his signature and shall have such other powers and duties
as may from time to time be assigned to him by resolution of the board of
directors or as are incident to his office. He may be required to give such
bond for the faithful performance of his duties as the board of directors in
their uncontrolled discretion may require and no director shall be liable for
failure to require any such bond or for the insufficiency of any such bond or
for any loss by reason of the failure of the Corporation to receive any
indemnity thereby provided.

24.  ASSISTANT SECRETARY AND ASSISTANT TREASURER. The assistant secretary or,
if more than one, the assistant Secretaries in order of seniority, and the
assistant treasurer or, if more than one, the assistant treasurers in order
or seniority, shall respectively perform all the duties of the secretary and
treasurer, respectively, in the absence or inability to act of the secretary
or treasurer as the case may be. The assistant secretary or assistant
secretaries, if more than one, and the assistant treasurer or assistant
treasurers, if more than one, shall sign such contracts, documents or
instruments in writing as require his or their signatures respectively and
shall have such other powers and duties as may from time to time be assigned
to them by resolution of the board of directors.


                                     -10-

MANAGING DIRECTOR
- -----------------

25.  The board of directors may from time to time appoint from their number a
managing director who is a resident Canadian and may delegate to him any of
the powers of the board of directors except as provided in subsection 115(3)
of the Act. The managing director shall conform to all lawful orders given to
him by the board of directors of the Corporation and shall at all reasonable
times give to the directors or any of them all information they may require
regarding the affairs of the Corporation. Any agent or employee appointed by
the managing director shall be subject to discharge by the board of directors.

COMMITTEES

26.  The board of directors may from time to time appoint from their number
one or more committees consisting of one or more individuals and delegate to
such committee or committees any of the powers of the directors except as
provided in subsection 115(3) of the Act. Except in the case of a holding
Corporation referred to in subsection 105(4) of the Act, a majority of the
members of any such committee must be resident Canadians. Unless otherwise
ordered by the board, a committee of directors shall have power to fix its
quorum, to elect its chairman and to regulate its proceedings.

SHAREHOLDERS' MEETINGS

27.  ANNUAL MEETING. Subject to compliance with section 133 of the Act, the
annual meeting of the shareholders shall be convened on such day in each year
and at such time as the board of directors may by resolution determine.

28.  SPECIAL MEETINGS. Other meetings of the shareholders may be convened by
order of the chairman of the board, the president or a vice-president who is
a director or by the board of directors, to be held at such time and place as
may be specified in such order.

     Special meetings of shareholders may also be called by written
requisition to the board of directors signed by shareholders holding between
them not less than five percent (5%) of the outstanding shares of the capital
of the Corporation entitled to vote thereat. Such requisition shall state the
business


                                     -11-


to be transacted at the meeting and shall be sent to the registered office of
the Corporation.

     Except as otherwise provided in subsection 143(3) of the Act, it shall
be the duty of the board of directors on receipt of such requisition, to
cause the meeting to be called by the secretary of the Corporation.

     If the board of directors does not, within twenty-one (21) days after
receiving such requisition call a meeting, any shareholder who signed the
requisition may call the meeting.

29.  PLACE OF MEETINGS. Meetings of shareholders of the Corporation shall be
held at the registered office of the Corporation or at such other place in
Canada as may be specified in the notice convening such meeting.
Notwithstanding the foregoing, a meeting of shareholders may be held outside
Canada if all the shareholders entitled to vote at the meeting so agree, and
a shareholder who attends a meeting of shareholders held outside Canada is
deemed to have so agreed except when he attends the meeting for the express
purpose of objecting to the transaction of any business on the grounds that
the meeting is not lawfully held.

30.  NOTICE. A printed, written or typewritten notice stating the day, hour
and place of meeting and, subject to subsection 135(6) of the Act, the general
nature of the business to be transacted shall be served to each person who is
entitled to vote at such meeting, each director of the Corporation and the
auditor of the Corporation, either personally or by sending such notice by
prepaid mail not less than twenty-one (21) days or more than fifty (50) days
before the meeting. If such notice is served by mail it shall be directed to
the latest address as shown in the records of the Corporation, of the
intended recipient. Notice of any meeting of shareholders or any irregularity
in any such meeting or in the notice thereof may be waived by any
shareholder, the duly appointed proxy of any shareholder, any directors or
the auditor of the Corporation in writing, by telegram, cable or telex
addressed to the Corporation or by any other manner, and any such waiver may
be validly given either before or after the meeting to which such waiver
relates.

31.  OMISSION OF NOTICE. The accidental omission to give notice of any
meeting to or the non-receipt of any notice by any person shall not
invalidate any resolution passed or any proceeding taken at any meeting of
shareholders.


                                     -12-

32.  RECORD DATE. The board of directors may by resolution fix in advance a
date and time as the record date for the determination of the shareholders
entitled to receive notice of a meeting of the shareholders, but such record
date shall not precede by more than fifty (50) days or by less than
twenty-one (21) days the date on which the meeting is to be held.

     If the directors fail to fix in advance a date and time as the record
date in respect of all or any of the matters described above for any meeting
of the shareholders of the Corporation the following provisions shall apply,
as the case may be:

     (a)  the record date for the determination of the shareholders entitled
          to receive notice of a meeting of shareholders shall be at the close
          of business on the day immediately preceding the day on which notice
          is given or sent;

     (b)  the record date for the determination of the shareholders entitled
          to vote at a meeting of shareholders shall be the day on which the
          meeting is held; and

     (c)  the record date for the determination of the shareholders entitled
          to receive the financial statements of the Corporation shall be the
          close of business on the day on which the directors pass the
          resolution relating thereto.

33.  VOTES. Voting at a meeting of shareholders shall be by show of hands
except where a ballot is demanded by a shareholder entitled to vote at the
meeting. A shareholder may demand a ballot either before or after any vote by
show of hands.

     Every question submitted to any meeting of shareholders shall be decided
in the first instance, unless a ballot is demanded, on a show of hands and in
case of an equality of votes the chairman of the meeting shall not, both on a
show of hands and on a ballot, have a second or casting vote in addition to
the vote or votes to which he may be entitled as a shareholder.

     At any meeting, unless a ballot is demanded, a declaration by the
chairman of the meeting that a resolution has been carried or carried
unanimously or by a particular majority or lost or not carried by a particular


                                     -13-

majority shall be conclusive evidence of the fact without proof of the number
or proportion of votes recorded in favour of or against the motion.

     In the absence of the chairman of the board, the president and every
vice-president who is a director, the shareholders present entitled to vote
shall choose another director as chairman of the meeting and if no director
is present or if all the directors present decline to take the chair then the
shareholders present shall choose one of their number to be chairman.

     If at any meeting a ballot is demanded on the election of a chairman or
on the question of adjournment or termination it shall be taken forthwith
without adjournment. If a ballot is demanded on any other question or as to
the election of directors it shall be taken in such manner and either at once
or later at the meeting or after adjournment as the chairman of the meeting
directs. The result of a ballot shall be deemed to be the resolution of the
meeting at which the ballot was demanded. A demand for a ballot may be
withdrawn.

     Where a person holds shares as a personal representative, such person or
his proxy is the person entitled to vote at all meetings of shareholders in
respect of the shares so held by him.

     Where a person mortgages or hypothecates his shares, such person or his
proxy is the person entitled to vote at all meetings of shareholders in
respect of such shares unless, in the instrument creating the mortgage or
hypothec, he has expressly empowered the person holding the mortgage or
hypothec to vote in respect of such shares, in which case, subject to the
Corporation's articles, such holder or his proxy is the person entitled to
vote in respect of the shares.

     Where two (2) or more persons hold the same share or shares jointly, any
one of such persons present at a meeting of shareholders has the right, in
the absence of the other or others, to vote in respect of such share or
shares, but if more than one of such persons are present or represented by
proxy and vote, they shall vote together as one on the share or shares
jointly held by them.

34.  PROXIES. A shareholder, including a shareholder that is a body
corporate, entitled to vote at a meeting of shareholders may by means of a
proxy appoint a proxyholder or one or more alternate proxyholders, who are
not required to be shareholders, to attend and act at the meeting in the
manner and to the extent authorized by the proxy and with the authority
conferred by the proxy.


                                     -14-

     An instrument appointing a proxyholder shall be in writing and shall be
executed by the shareholder or his attorney authorized in writing or, if the
shareholder is a body corporate, either under its seal or by an officer or
attorney thereof, duly authorized. A proxy is valid only at the meeting in
respect of which it is given or any adjournment thereof.

     Unless the Act requires another form, an instrument appointing a
proxyholder may be in the following form:

     "The undersigned shareholder of                        hereby appoints of
                or           failing him,             of             as
the nominee of the undersigned to attend and act for and on behalf of the
undersigned at the meeting of the shareholders of the said Corporation to be
held on the        day of      , 19   , and at any adjournment thereof to the
same extent and with the same power as if the undersigned were personally
present at the said meeting or such adjournment thereof.

     Dated the          day of            , 19  .


                                         -------------------------------------
                                         Signature of Shareholder

NOTE:

This form of proxy must be signed by a shareholder or his attorney authorized
in writing or, if the shareholder is a body corporate, either under its seal
or by an officer or attorney thereof duly authorized."

     The directors may from time to time pass regulations regarding the
deposit of instruments appointing a proxyholder at some place or places other
than the place at which a meeting or adjourned meeting of shareholders is to
be held and for particulars of such instruments to be telegraphed, cabled,
telexed or sent in writing before the meeting or adjourned meeting to the
Corporation or any agent of the Corporation for the purpose of receiving such
particulars and providing that instruments appointing a proxyholder so lodged
may be voted upon as though the instruments themselves were produced at the
meeting or adjourned meeting and votes given in accordance with such


                                     -15-

regulations shall be valid and shall be counted. The chairman of any meeting
of shareholders may, subject to any regulations made as aforesaid, in his
discretion accept telegraphic, telex, cable or written communication as to
the authority of anyone claiming to vote on behalf of and to represent a
shareholder notwithstanding that no instrument of proxy conferring such
authority has been lodged with the Corporation, and any votes given in
accordance with such telegraphic, telex, cable or written communication
accepted by the chairman of the meeting shall be valid and shall be counted.

35.  ADJOURNMENT. The chairman of the meeting may with the consent of the
meeting adjourn any meeting of shareholders from time to time to a fixed time
and place. If a meeting of shareholders is adjourned less than thirty (30)
days, it is not necessary to give notice of the adjourned meeting other than
by announcement at the earliest meeting that is adjourned. If a meeting of
shareholders is adjourned by one or more adjournments for an aggregate of
thirty (30) days or more, notice of the adjourned meeting shall be given as
for an original meeting but, unless the meeting is adjourned by one or more
adjournments for an aggregate of more than ninety (90) days, the
requirements of subsection 149(1) of the Act relating to mandatory
solicitation of proxies do not apply.

     Any adjourned meeting shall be duly constituted if held in accordance
with the terms of the adjournment and a quorum is present thereat. The
persons who formed a quorum at the original meeting are not required to form
a quorum at the adjourned meeting. If there is no quorum present at the
adjourned meeting, the original meeting shall be deemed to have terminated
forthwith after its adjournment. Any business may be brought before or dealt
with at any adjourned meeting which might have been brought before or dealt
with at the original meeting in accordance with the notice calling same.

36.  QUORUM. One (1) person present and holding or representing by proxy at
least one (1) issued share of the Corporation shall be a quorum of any
meeting of shareholders for the choice of a chairman of the meeting and for
the adjournment of the meeting: for all other purposes a quorum for any
meeting (unless a different number of shareholders and/or a different number
of shares are required to be represented by the Act or by the articles or by
any other by-law) shall be persons present being not less than two (2) in
number and holding or representing by proxy a majority of the shares entitled
to vote at such meeting. If a quorum is present at the opening of a meeting
of the shareholders, the shareholders present may proceed with the business
of the


                                     -16-

meeting, notwithstanding that a quorum is not present throughout the meeting.
Where the Corporation has only one shareholder or only one holder of any
class or series of shares, the shareholder present in person or by proxy
constitutes a meeting.

37.  RESOLUTION IN LIEU OF MEETING. Except where a written statement is
submitted by a director under subsection 110(2) of the Act or by an auditor
under subsection 168(5) of the Act, a resolution in writing signed by all the
shareholders entitled to vote on that resolution at a meeting of shareholders
is as valid as if it had been passed at a meeting of the shareholders.

     A copy of every such resolution shall be kept with the minutes of the
meetings of shareholders.

SECURITIES
- ----------

38.  CERTIFICATES. Share certificates (and the form of stock transfer power
on the reverse side thereof) shall (subject to compliance with section 49 of
the Act) be in such form and be signed by such director(s) or officer(s) as
the board of directors may from time to time by resolution determine.

39.  REGISTRAR AND TRANSFER AGENT. The board of directors may from time to
time by resolution appoint or remove one or more registrars and/or branch
registrars (which may but need not be the same person) to keep the register
of security holders and/or one or more transfer agents and/or branch
transfer agents (which may but need not be the same person) to keep the
register of transfer, and (subject to section 50 of the Act) may provide for
the registration of issues and the registration of transfers of the
securities of the Corporation in one or more places and such registrars
and/or branch registrars and/or transfer agents and/or branch transfer agents
shall keep all necessary books and registers of the Corporation for the
registration of the issuance and the registration of transfers of the
securities of the Corporation for which they are so appointed. All
certificates issued after any such appointment representing securities issued
by the Corporation shall be countersigned by or on behalf of one of the said
registrars and/or branch registrars and/or transfer agents and/or branch
transfer agents, as the case may be.


                                     -17-

40.  SURRENDER OF SHARE CERTIFICATES. No tranfer of a share issued by the
Corporation shall be recorded or registered unless or until the certificate
representing the share to be transferred has been surrendered and cancelled
or, if no certificate has been issued by the Corporation in respect of such
share, unless or until a duly executed share transfer power in respect
thereof has been presented for registration.

41.  DEFACED, DESTROYED, STOLEN OR LOST CERTIFICATES. If the defacement,
destruction or apparent destruction, theft, or other wrongful taking or loss
of a share certificate is reported by the owner to the Corporation or to a
registrar, branch registrar, transfer agent or branch transfer agent of the
Corporation (hereinafter, in this paragraph, called the "Corporation's
tranfer agent") and such owner gives to the Corporation or the Corporation's
transfer agent a written statement verified by oath or statutory declaration
as to the defacement, destruction or apparent destruction, theft, or other
wrongful taking or loss and the circumstances concerning the same, a request
for the issuance of a new certificate to replace the one so defaced,
destroyed, wrongfully taken or lost and a bond of a surety company (or other
security approved by the board of directors) in such form as is approved by
the board of directors or by the chairman of the board, the president, a
vice-president, the secretary or the treasurer of the Corporation,
indemnifying the Corporation (and the Corporation's transfer agent, if any),
against all loss, damage or expense, which the Corporation and/or the
Corporation's transfer agent may suffer or be liable for by reason of the
issuance of a new certificate to such shareholder, a new certificate may be
issued in replacement of the one defaced, destroyed or apparently destroyed,
stolen or otherwise wrongfully taken or lost, if such issuance is ordered and
authorized by any one of the chairman of the board, the president, a
vice-president, the secretary or the treasurer of the Corporation or by
resolution of the board of directors.

DIVIDENDS
- ---------

42.  Subject to the relevant provisions of the Act, the board of directors
may from time to time by resolution declare and the Corporation may pay
dividends on its issued shares, subject to the relevant provisions, if any,
of the articles.


                                     -18-

NOTICE
- ------

43.  SHARES REGISTERED IN MORE THAN ONE NAME. All notices or other documents
required to be sent to a shareholder by the Act, the regulations under the
Act, the articles or the by-laws of the Corporation shall, with respect to
any shares in the capital of the Corporation registered in more than one
name, be given to whichever of such persons is named first in the records of
the Corporation and any notice or other document so given shall be sufficient
notice or delivery of such document to all the holders of such shares.

44.  PERSONS BECOMING ENTITLED BY OPERATION OF LAW. Every person who by
operation of law, transfer or by any other means whatsoever shall become
entitled to any share in the capital of the Corporation shall be bound by
every notice or other document in respect of such shares which prior to his
name and address being entered on the records of the Corporation shall have
been duly given to the person or persons from who he derives his title to
such shares.

45.  DECEASED SHAREHOLDER. Any notice or other document delivered or sent by
post or left at the address of any shareholder as the same appears in the
records of the Corporation shall, notwithstanding that such shareholder be
then deceased and whether or not the Corporation has notice of his decease,
be deemed to have been duly served in respect of the shares held by such
shareholder (whether held solely or with other persons) until some other
person be entered in his stead in the records of the Corporation as the
holder or one of the holders thereof and such service shall for all purposes
be deemed a sufficient service of such notice or other document on his heirs,
executors or administrators and all persons, if any, interested with him in
such shares.

46.  SIGNATURES TO NOTICES. The signature of any director or officer of the
Corporation to any notice may be written, stamped, typewritten or printed or
partly written, stamped, typewritten or printed.

47.  COMPUTATION OF TIME. Where a given number a days' notice or notice
extending over any period is required to be given under any provisions of the
articles or by-laws of the Corporation, the day of service or posting of the
notice shall, unless it is otherwise provided, be counted in such number of
days or other period and such notice shall be deemed to have been given or
sent on the day of service or posting.


                                     -19-

48.  PROOF OF SERVICE. A certificate of any officer of the Corporation in
office at the time of the making of the certificate or of a transfer officer
of any transfer agent or branch transfer agent of shares of any class of the
Corporation as to facts in relation to the mailing or delivery or service of
any notice or other documents to any shareholder, director, officer or
auditor or publication of any notice or other document shall be conclusive
evidence thereof and shall be binding on every shareholder, director, officer
or auditor of the Corporation as the case may be.

CHEQUES, DRAFTS, NOTES, ETC.
- ----------------------------

49.  All cheques, drafts or orders for the payment of money and all notes,
acceptances and bills of exchange shall be signed by such officer or officers
or other person or persons, whether or not officers of the Corporation, and
in such manner as the board of directors may from time to time designate by
resolution.

CUSTODY OF SECURITIES
- ---------------------

50.  All securities, including warrants, owned by the Corporation shall be
lodged, in the name of the Corporation, with a chartered bank or a trust
company or in a safety deposit box or, if so authorized by resolution of the
board of directors, with such other depositaries or in such other manner as
may be determined from time to time by the board of directors.

     All securities, including warrants, belonging to the Corporation may be
issued and held in the name of a nominee or nominees of the Corporation, and
if issued or held in the names of more than one nominee shall be held in the
names of the nominees jointly with right of survivorship and shall be
endorsed in blank with endorsement guaranteed in order to enable transfer
thereof to be completed and registration thereof to be effected.

EXECUTION OF CONTRACTS, ETC.
- ----------------------------

51.  Contracts, documents or instruments in writing requiring the signature
of the Corporation may be signed by two (2) persons, one of whom holds the
office of chairman of the board, president, managing director, vice-president
or director and the other of whom holds one of the said offices or the office
of


                                     -20-

secretary, treasurer, assistant secretary or assistant treasurer or any other
office created by by-law or by resolution of the board. All contracts,
documents or instruments in writing so signed shall be binding upon the
Corporation without any further authorization or formality. The board of
directors is authorized from time to time by resolution to appoint any
officer or officers or any other person or persons on behalf of the
Corporation either to sign contracts, documents or instruments in writing
generally or to sign specific contracts, documents or instruments in writing.
Where the Corporation has only one director and officer being the same
person, that person may sign all such contracts, documents or other written
instruments.

     The corporate seal, if any, may, when required, be affixed to contracts,
documents or instruments in writing signed as aforesaid or by an officer or
officers, person or persons appointed as aforesaid by resolution of the board
of directors.

     The term "contracts, documents or instruments in writing" as used in
this by-law shall include deeds, mortgages, hypothecs, charges, conveyances,
transfers and assignments of property, real or personal, immoveable or
moveable, agreements, releases, receipts and discharges for the payment of
money or other obligations, conveyances, transfers and assignments of shares,
warrants, bonds, debentures or other securities and all paper writings.

     In particular, without limiting the generality of the foregoing, two (2)
persons, one of whom holds the office of chairman of the board, president,
managing director, vice-president or director and the other of whom holds one
of the said offices or the office of secretary, treasurer, assistant
secretary or assistant treasurer or any other office created by by-law or by
resolution of the board are hereby authorized to sell, assign, transfer,
exchange, convert or convey all shares, bonds, debentures, rights, warrants
or other securities owned by or registered in the name of the Corporation and
to sign and execute, under the seal of the Corporation or otherwise, all
assignments, transfers, conveyances, powers of attorney and other instruments
that may be necessary for the purpose of selling, assigning, transferring,
exchanging, converting or conveying or enforcing or exercising any voting
rights in respect of any such shares, bonds, debentures, rights, warrants or
other securities. Where the Corporation has only one director and officer,
being the same person, that person may perform the functions and exercise the
powers herein contemplated.



                                     -21-

     The signature or signatures of any officer or director of the
Corporation and/or of any other officer or officers, person or persons
appointed as aforesaid by resolution of the board of directors may, if
specifically authorized by resolution of the directors, be printed, engraved,
lithographed or otherwise mechanically reproduced upon all contracts,
documents or instruments in writing or, subject to subsections 49(4) and
49(5) of the Act, bonds, debentures or other securities of the Corporation
executed or issued by or on behalf of the Corporation and all contracts,
documents or instruments in writing or bonds, debentures or other securities
of the Corporation on which the signatures of any of the foregoing officers,
directors or persons shall be so reproduced, by authorization by resolution
of the board of directors, shall, subject to subsections 49(4) and 49(5) of
the Act, be deemed to have been duly signed by such officers, shall be as
valid to all intents and purposes as if they had been signed manually and
notwithstanding that the officers, directors or persons whose signature or
signatures is or are so reproduced may have ceased to hold office at the date
of delivery or issue of such contracts, documents or instruments in writing
or bonds, debentures or other securities of the Corporation.

DECLARATIONS
- ------------

57.  The chariman of the board, if appointed, the president, the
vice-presidents, secretary and/or treasurer, the assistant secretaries and/or
assistant treasurers, comptroller, accountant, chief clerk, or any one of
them, is authorized and empowered to appear and make answer for the
Corporation to all writs, orders and interrogatories upon articulated facts
issued out of any court and to declare for and on behalf of the Corporation
any answer to writs of attachment by way of garnishment in which the
Corporation is garnishee, and to make all affidavits and sworn declarations
in connection therewith or in connection with any or all judicial proceedings
to which the Corporation is a party and to make demands of abandonment or
petitions for winding up or bankruptcy orders upon any debtor of the
Corporation and to attend and vote at all meetings of creditors of any of the
Corporation's debtors and grant Proxies in connection therewith.


                                     -22-

FISCAL YEAR
- -----------

53.  The fiscal period of the Corporation shall terminate on such day in each
year as the board of directors may from time to time by resolution determine.


The foregoing resolution is hereby consented to by the signature of the sole
director of 3351611 CANADA INC., pursuant to subsection 117(1) of the CANADA
BUSINESS CORPORATIONS ACT, effective as of the 3rd day of March, 1997.


                                        C. SALISBURY
                                        -------------------------------------
                                        Catherine Salisbury

EX-4.2

                                                                    EXHIBIT 4.2

================================================================================








                              SUN MEDIA CORPORATION


                                 US$205,000,000


                            7-5/8% SENIOR NOTES DUE 2013


                         ------------------------------


                                    INDENTURE


                          DATED AS OF FEBRUARY 7, 2003


                         ------------------------------


                               NATIONAL CITY BANK,
                                   AS TRUSTEE






================================================================================





                                                           TABLE OF CONTENTS





                                                                                                     PAGE
                                                                                               

ARTICLE 1.        DEFINITIONS AND INCORPORATION BY REFERENCE............................................1

         Section 1.01.     Definitions..................................................................1

         Section 1.02.     Other Definitions...........................................................21

         Section 1.03.     Incorporation by Reference of Trust Indenture Act...........................22

         Section 1.04.     Rules of Construction.......................................................22

ARTICLE 2.        THE NOTES............................................................................23

         Section 2.01.     Form and Dating.............................................................23

         Section 2.02.     Execution and Authentication................................................24

         Section 2.03.     Registrar and Paying Agent..................................................24

         Section 2.04.     Paying Agent to Hold Money in Trust.........................................24

         Section 2.05.     Holder Lists................................................................25

         Section 2.06.     Transfer and Exchange.......................................................25

         Section 2.07.     Replacement Notes...........................................................35

         Section 2.08.     Outstanding Notes...........................................................35

         Section 2.09.     Treasury Notes..............................................................35

         Section 2.10.     Temporary Notes.............................................................36

         Section 2.11.     Cancellation................................................................36

         Section 2.12.     Defaulted Interest..........................................................36

         Section 2.13.     CUSIP or ISIN Numbers.......................................................36

         Section 2.14.     Special Interest............................................................36

         Section 2.15.     Issuance of Additional Notes................................................37

ARTICLE 3.        REDEMPTION AND PREPAYMENT............................................................37

         Section 3.01.     Notices to Trustee..........................................................37

         Section 3.02.     Selection of Notes to Be Redeemed...........................................37

         Section 3.03.     Notice of Redemption........................................................38

         Section 3.04.     Effect of Notice of Redemption..............................................38

         Section 3.05.     Deposit of Redemption Price.................................................38

         Section 3.06.     Notes Redeemed in Part......................................................39

         Section 3.07.     Optional Redemption.........................................................39

         Section 3.08.     Mandatory Redemption........................................................40

         Section 3.09.     Offers To Purchase..........................................................40

ARTICLE 4.        COVENANTS............................................................................42

         Section 4.01.     Payment of Notes............................................................42

         Section 4.02.     Maintenance of Office or Agency.............................................42



                                                                   i



                                                           TABLE OF CONTENTS
                                                              (CONTINUED)



                                                                                                     PAGE
                                                                                               

         Section 4.03.     Reports.....................................................................42

         Section 4.04.     Compliance Certificate......................................................43

         Section 4.05.     Taxes.......................................................................43

         Section 4.06.     Stay, Extension and Usury Laws..............................................43

         Section 4.07.     Corporate Existence.........................................................44

         Section 4.08.     Payments for Consent........................................................44

         Section 4.09.     Incurrence of Indebtedness and Issuance of Preferred Shares.................44

         Section 4.10.     Restricted Payments.........................................................46

         Section 4.11.     Liens.......................................................................49

         Section 4.12.     Asset Sales.................................................................49

         Section 4.13.     Dividend and Other Payment Restrictions Affecting Subsidiaries..............51

         Section 4.14.     Transactions with Affiliates................................................53

         Section 4.15.     Sale and Leaseback Transactions.............................................54

         Section 4.16.     Issuances and Sales of Equity Interests in Subsidiaries.....................54

         Section 4.17.     Designation of Restricted and Unrestricted Subsidiaries.....................55

         Section 4.18.     Repurchase at the Option of Holders Upon a Change of Control................56

         Section 4.19.     Future Guarantors...........................................................56

         Section 4.20.     Additional Amounts..........................................................56

ARTICLE 5.        SUCCESSORS...........................................................................57

         Section 5.01.     Merger, Consolidation and Sale of Assets of
                           the Company and Subsidiary Guarantors.......................................57

         Section 5.02.     Successor Corporation Substituted...........................................58

ARTICLE 6.        DEFAULTS AND REMEDIES................................................................59

         Section 6.01.     Events of Default...........................................................59

         Section 6.02.     Acceleration................................................................60

         Section 6.03.     Other Remedies..............................................................61

         Section 6.04.     Waiver of Past Defaults.....................................................61

         Section 6.05.     Control by Majority.........................................................62

         Section 6.06.     Limitation on Suits.........................................................62

         Section 6.07.     Rights of Holders to Receive Payment........................................62

         Section 6.08.     Collection Suit by Trustee..................................................62

         Section 6.09.     Trustee May File Proofs of Claim............................................62

         Section 6.10.     Priorities..................................................................63

         Section 6.11.     Undertaking for Costs.......................................................63

ARTICLE 7.        TRUSTEE..............................................................................63


                                                           ii



                                                           TABLE OF CONTENTS
                                                              (CONTINUED)



                                                                                                     PAGE
                                                                                               

         Section 7.01.     Duties of Trustee...........................................................63

         Section 7.02.     Rights of Trustee...........................................................64

         Section 7.03.     Individual Rights of Trustee................................................65

         Section 7.04.     Trustee's Disclaimer........................................................65

         Section 7.05.     Notice of Defaults..........................................................65

         Section 7.06.     Reports by Trustee to Holders...............................................65

         Section 7.07.     Compensation and Indemnity..................................................66

         Section 7.08.     Replacement of Trustee......................................................66

         Section 7.09.     Successor Trustee by Merger, etc............................................67

         Section 7.10.     Eligibility; Disqualification...............................................67

         Section 7.11.     Preferential Collection of Claims Against Company...........................67

ARTICLE 8.        LEGAL DEFEASANCE AND COVENANT DEFEASANCE.............................................68

         Section 8.01.     Option to Effect Legal Defeasance or Covenant Defeasance....................68

         Section 8.02.     Legal Defeasance and Discharge..............................................68

         Section 8.03.     Covenant Defeasance.........................................................68

         Section 8.04.     Conditions to Legal or Covenant Defeasance..................................69

         Section 8.05.     Deposited Cash and Government Securities to be Held in Trust;
                           Other Miscellaneous Provisions..............................................70

         Section 8.06.     Repayment to Company........................................................70

         Section 8.07.     Reinstatement...............................................................70

ARTICLE 9.        AMENDMENT, SUPPLEMENT AND WAIVER.....................................................71

         Section 9.01.     Without Consent of Holders of Notes.........................................71

         Section 9.02.     With Consent of Holders of Notes............................................71

         Section 9.03.     Compliance with Trust Indenture Act.........................................73

         Section 9.04.     Revocation and Effect of Consents...........................................73

         Section 9.05.     Notation on or Exchange of Notes............................................73

         Section 9.06.     Trustee to Sign Amendments, etc.............................................73

ARTICLE 10.       SUBSIDIARY GUARANTEES................................................................73

         Section 10.01.    Guarantee...................................................................73

         Section 10.02.    Limitation on Subsidiary Guarantor Liability................................75

         Section 10.03.    Execution and Delivery of Subsidiary Guarantee..............................75

         Section 10.04.    Subsidiary Guarantors May Consolidate, etc., on Certain Terms...............75

         Section 10.05.    Releases Following Sale of Assets...........................................76

ARTICLE 11.       SATISFACTION AND DISCHARGE...........................................................76

         Section 11.01.    Satisfaction and Discharge..................................................76


                                                           iii



                                                           TABLE OF CONTENTS
                                                              (CONTINUED)



                                                                                                     PAGE
                                                                                               

         Section 11.02.    Deposited Cash and Government Securities to be Held in Trust;
                           Other Miscellaneous Provisions..............................................77

         Section 11.03.    Repayment to Company........................................................77

ARTICLE 12.       MISCELLANEOUS........................................................................77

         Section 12.01.    Trust Indenture Act Controls................................................77

         Section 12.02.    Notices.....................................................................78

         Section 12.03.    Communication by Holders of Notes with Other Holders of Notes...............79

         Section 12.04.    Certificate and Opinion as to Conditions Precedent..........................79

         Section 12.05.    Statements Required in Certificate or Opinion...............................79

         Section 12.06.    Rules by Trustee and Agents.................................................79

         Section 12.07.    No Personal Liability of Directors, Officers, Employees and Shareholders....80

         Section 12.08.    Governing Law...............................................................80

         Section 12.09.    No Adverse Interpretation of Other Agreements...............................80

         Section 12.10.    Successors..................................................................80

         Section 12.11.    Severability................................................................80

         Section 12.12.    Consent to Jurisdiction and Service of Process..............................80

         Section 12.13.    Conversion of Currency......................................................81

         Section 12.14.    Currency Equivalent.........................................................81

         Section 12.15.    Counterpart Originals.......................................................82

         Section 12.16.    Table of Contents, Headings, etc............................................82

         Section 12.17.    Qualification of this Indenture.............................................82


EXHIBIT A:  FORM OF GLOBAL NOTE
EXHIBIT B:  FORM OF CERTIFICATE OF TRANSFER
EXHIBIT C:  FORM OF CERTIFICATE OF EXCHANGE
EXHIBIT D:  FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL
            ACCREDITED INVESTOR
EXHIBIT E:  FORM OF NOTATION OF GUARANTEE
EXHIBIT F:  FORM OF SUBORDINATION AGREEMENT


                                                      iv



                                                          CROSS-REFERENCE TABLE




 TIA SECTION REFERENCE                                        INDENTURE
                                                              SECTION
                                                           
310(a)(1).........................................            7.10
(a)(2)............................................            7.10
(a)(3)............................................            N.A.
(a)(4)............................................            N.A.
(a)(5)............................................            7.10
(b)...............................................            7.08, 7.10
(c)...............................................            N.A.
311(a)............................................            7.11
(b)...............................................            7.11
(c)...............................................            N.A.
312(a)............................................            2.05
(b)...............................................            12.03
(c)...............................................            12.03
313(a)............................................            7.06
(b)(1)............................................            N.A.
(b)(2)............................................            7.06, 7.07
(c)...............................................            7.06, 12.02
(d)...............................................            7.06
314(a)............................................            4.03, 4.04, 12.02
(b)...............................................            N.A.
(c)(1)............................................            12.04
(c)(2)............................................            12.04
(c)(3)............................................            N.A.
(d)...............................................            N.A.
(e)...............................................            12.05
315(a)............................................            7.01
(b)...............................................            7.05, 12.02
(c)...............................................            7.01
(d)...............................................            7.01
(e)...............................................            6.11
316(a) (last sentence)............................            2.09
(a)(1)(A).........................................            6.05
(a)(1)(B).........................................            6.04
(a)(2)............................................            N.A.
(b)...............................................            6.07
317(a)(1).........................................            6.08
(a)(2)............................................            6.09
(b)...............................................            2.04
318(a)............................................            12.01

N.A. means Not Applicable.


Note:  This Cross-Reference Table shall not, for any purpose, be deemed to be
       part of this Indenture.



                                                                  EXECUTION COPY

                  This INDENTURE, dated as of February 7, 2003, is by and among
SUN MEDIA CORPORATION, a company continued under the laws of the Province of
British Columbia, each Subsidiary Guarantor listed on the signature pages
hereto, and NATIONAL CITY BANK, as trustee (the "TRUSTEE").

                  The Company, each Subsidiary Guarantor and the Trustee agree
as follows for the benefit of each other and for the equal and ratable benefit
of the Holders of the 7-5/8% Senior Notes due 2013 (the "NOTES"):

                                     ARTICLE 1.

                   DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01.     DEFINITIONS.

                  For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:

                  "144A GLOBAL NOTE" means a Global Note in the form of Exhibit
A hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold for initial resale in reliance on Rule 144A.

                  "ACQUIRED DEBT" means, with respect to any specified Person:

                  (1) Indebtedness of any other Person existing at the time such
                  other Person is merged with or into or becomes a Subsidiary of
                  such specified Person, whether or not such Indebtedness is
                  incurred in connection with, or in contemplation of, such
                  other Person merging with or into, or becoming a Subsidiary of
                  such specified Person; and

                  (2) Indebtedness secured by a Lien encumbering any asset
                  acquired by such specified Person.

                  "ADDITIONAL NOTES" means any Notes (other than Initial Notes
and Exchange Notes and Notes issued under Sections 2.06, 2.07, 2.10 and 3.06
hereof) issued under this Indenture in accordance with Sections 2.02, 2.15 and
4.09 hereof, as part of the same series as the Initial Notes or as an additional
series.

                  "AFFILIATE" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control," as used with respect to any Person, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise; PROVIDED, HOWEVER, that beneficial
ownership of more than 10% of the Voting Stock of a Person shall be deemed to be
control. For purposes of this definition, the terms "controlling," "controlled
by" and "under common control with" shall have correlative meanings.

                  "AGENT" means any Registrar, co-registrar, Paying Agent or
additional paying agent.

                  "APPLICABLE PROCEDURES" means, with respect to any transfer,
redemption or exchange of or for beneficial interests in any Global Note, the
rules and procedures of the Depositary, Euroclear and Clearstream that apply to
such transfer, redemption or exchange.

                  "ASSET ACQUISITION" means (a) an Investment by the Company or
any Restricted Subsidiary in any other Person pursuant to which such Person
shall become a Restricted Subsidiary or shall be consolidated or merged with or
into the Company or any Restricted Subsidiary or (b) any acquisition by the
Company or any Restricted Subsidiary of the assets of any Person that constitute
substantially all of an operating unit, a division or line of business of such
Person or that is otherwise outside of the ordinary course of business.



                  "ASSET SALE" means:

                  (1) the sale, lease, conveyance or other disposition of any
         assets or rights, other than sales of inventory in the ordinary course
         of business; PROVIDED, HOWEVER, that the sale, conveyance or other
         disposition of all or substantially all of the assets of the Company
         and its Subsidiaries, taken as a whole, shall be governed by the
         provisions of Sections 4.18 and 5.01 hereof and not by the provisions
         of Section 4.12 hereof; and

                  (2) the issuance of Equity Interests of any Restricted
         Subsidiary or the sale of Equity Interests in any Restricted
         Subsidiary.

                  Notwithstanding the preceding, the following items shall not
be deemed to be Asset Sales:

                  (1) any single transaction or series of related transactions
         that involves assets having a fair market value (as determined by the
         Board of Directors of the Company and evidenced by a resolution of the
         Board of Directors of the Company set forth in an Officers' Certificate
         and delivered to the Trustee) of less than US$1.0 million;

                  (2) a sale, lease, conveyance or other disposition of assets
         between or among the Company and the Subsidiary Guarantors;

                  (3) an issuance of Equity Interests by a Restricted Subsidiary
         to the Company or to another Restricted Subsidiary;

                  (4) the sale, lease, conveyance or other disposition of
         equipment, inventory, accounts receivable or other assets in the
         ordinary course of business;

                  (5) the sale or other disposition of cash or Cash Equivalents;

                  (6) any Tax Benefit Transaction; and

                  (7) a Restricted Payment or Permitted Investment that is
         permitted by Section 4.10 hereof.

                  "ASSET SWAP" means an exchange of assets by the Company or a
Restricted Subsidiary for:

                  (1) one or more Permitted Businesses;

                  (2) a controlling equity interest in any Person whose assets
         consist primarily of one or more Permitted Businesses; and/or

                  (3) long-term assets that are used in a Permitted Business in
         a like-kind exchange or transfer pursuant to Section 1031 of the Code
         or any similar or successor provision of the Code or Sections 51, 85,
         85.1, 86, 87 or 88(1) of the INCOME TAX ACT (Canada) or any similar or
         successor provisions of the INCOME TAX ACT (Canada).

                  "ATTRIBUTABLE DEBT" in respect of a sale and leaseback
transaction means, at the time of determination, the present value of the
obligation of the lessee for net rental payments during the remaining term of
the lease included in such sale and leaseback transaction including any period
for which such lease has been extended or may, at the option of the lessor, be
extended. Such present value shall be calculated using a discount rate equal to
the rate of interest implicit in such transaction, determined in accordance with
GAAP.

                  "BACK-TO-BACK DEBT" means any loans made or debt instruments
issued as part of a Back-to-Back Transaction and in which each party to such
Back-to-Back Transaction, other than a Sun Media Entity, executes a
subordination agreement in favor of the Holders in substantially the form
attached hereto as Exhibit F.

                                       2



                  "BACK-TO-BACK PREFERRED SHARES" means Preferred Shares issued:

                  (1) to a Sun Media Entity by an Affiliate of the Company in
         circumstances where, immediately prior to or after, as the case may be,
         the issuance of such Preferred Shares, an Affiliate of such Sun Media
         Entity has loaned on an unsecured basis to such Sun Media Entity, or an
         Affiliate of such Sun Media Entity has subscribed for Preferred Shares
         of such Sun Media Entity in, an amount equal to the requisite
         subscription price for such Preferred Shares;

                  (2) by a Sun Media Entity to one of its Affiliates in
         circumstances where, immediately prior to or after, as the case may be,
         the issuance of such Preferred Shares, such Sun Media Entity has loaned
         an amount equal to the proceeds of such issuance to an Affiliate on an
         unsecured basis; or

                  (3) by a Sun Media Entity to one of its Affiliates in
         circumstances where, immediately prior to or after, as the case may be,
         the issuance of such Preferred Shares, such Sun Media Entity has used
         the proceeds of such issuance to subscribe for Preferred Shares issued
         by an Affiliate;

                  in each case on terms whereby:

                   (i) the aggregate redemption amount applicable to the
         Preferred Shares issued to or by such Sun Media Entity is identical:

                   (A)     in the case of (1) above, to the principal amount of
                           the loan made or the aggregate redemption amount of
                           the Preferred Shares subscribed for by such
                           Affiliate;

                   (B)     in the case of (2) above, to the principal amount of
                           the loan made to such Affiliate; or

                   (C)     in the case of (3) above, to the aggregate redemption
                           amount of the Preferred Shares issued by such
                           Affiliate;

                   (ii) the dividend payment date applicable to the Preferred
         Shares issued to or by such Sun Media Entity shall:

                   (A)     in the case of (1) above, be immediately prior to, or
                           on the same date as, the interest payment date
                           relevant to the loan made or the dividend payment
                           date on the Preferred Shares subscribed for by such
                           Affiliate;

                   (B)     in the case of (2) above, be immediately after, or on
                           the same date as, the interest payment date relevant
                           to the loan made to such Affiliate; or

                   (C)     in the case of (3) above, be immediately after, or on
                           the same date as, the dividend payment date on the
                           Preferred Shares issued by such Affiliate;

                   (iii) the amount of dividends provided for on any payment
         date in the share conditions attaching to the Preferred Shares issued:

                  (A)      to a Sun Media Entity in the case of (1) above, shall
                           be equal to or in excess of the amount of interest
                           payable in respect of the loan made or the amount of
                           dividends provided for in respect of the Preferred
                           Shares subscribed for by such Affiliate;


                                       3



                  (B)      by a Sun Media Entity in the case of (2) above, shall
                           be less than or equal to the amount of interest
                           payable in respect of the loan made to such
                           Affiliate; or

                  (C)      by a Sun Media Entity in the case of (3) above, shall
                           be equal to the amount of dividends in respect of the
                           Preferred Shares issued by such Affiliate.

                  "BACK-TO-BACK SECURITIES" means Back-to-Back Preferred Shares
or Back-to-Back Debt or both, as the context requires.

                  "BACK-TO-BACK TRANSACTION" means any of the transactions
described under the definition of Back-to-Back Preferred Shares.

                  "BANKRUPTCY LAW" means Title 11, U.S. Code or any similar
federal or state law for the relief of debtors, the BANKRUPTCY AND INSOLVENCY
ACT (Canada), the COMPANIES' CREDITORS ARRANGEMENT ACT (Canada) or any other
Canadian federal or provincial law or the law of any other jurisdiction relating
to bankruptcy, insolvency, winding up, liquidation, reorganization or relief of
debtors.

                  "BENEFICIAL OWNER" has the meaning assigned to such term in
Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the
beneficial ownership of any particular "person" (as such term is used in Section
13(d)(3) of the Exchange Act), such "person" shall be deemed to have beneficial
ownership of all securities that such "person" has the right to acquire by
conversion or exercise of other securities, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition.

                  "BOARD OF DIRECTORS" means:

                  (1) with respect to a corporation, the board of directors of
         the corporation;

                  (2) with respect to a partnership, the board of directors of
         the general partner of the partnership; and

                  (3) with respect to any other Person, the board or committee
         of such Person serving a similar function.

                  "BOARD RESOLUTION" means a copy of a resolution certified by
the secretary or an assistant secretary (or individual performing comparable
duties) of the applicable Person to have been duly adopted by the Board of
Directors of such Person and to be in full force and effect on the date of such
certification, and delivered to the Trustee.

                  "BUSINESS DAY" means any day other than a Legal Holiday.

                  "CANADIAN TAXING AUTHORITY" means any federal, provincial,
territorial or other Canadian government or any authority or agency thereof
having the power to tax.

                  "CAPITAL LEASE OBLIGATION" means, at the time any
determination thereof is to be made, the amount of the liability in respect of a
capital lease that would at that time be required to be capitalized on a balance
sheet in accordance with GAAP.

                  "CAPITAL STOCK" means:

                  (1) in the case of a corporation, corporate stock;

                                       4


                  (2) in the case of an association or business entity, any and
         all shares, interests, participations, rights or other equivalents
         (however designated) of corporate stock;

                  (3) in the case of a partnership or limited liability company,
         partnership or membership interests (whether general or limited); and

                  (4) any other interest or participation that confers on a
         Person the right to receive a share of the profits and losses of, or
         distributions of assets of, the issuing Person.

                  "CAPITAL STOCK SALE PROCEEDS" means the aggregate net cash
proceeds received by the Company after the Issue Date:

                  (1) as a contribution to the common equity capital or from the
         issue or sale of Equity Interests of the Company (other than
         Disqualified Stock or Back-to-Back Securities); or

                  (2) from the issue or sale of convertible or exchangeable
         Disqualified Stock or convertible or exchangeable debt securities of
         the Company that have been converted into or exchanged for such Equity
         Interests,

other than, in either (1) or (2), Equity Interests (or convertible or
exchangeable Disqualified Stock or convertible or exchangeable debt securities)
sold to a Subsidiary of the Company.

                  "CASH EQUIVALENTS" means:

                  (1) United States dollars or Canadian dollars;

                  (2) investments in securities with maturities of one year or
         less from the date of acquisition issued or fully guaranteed by any
         state, commonwealth, territory or province of the United States of
         America or Canada, or by any political subdivision or taxing authority
         thereof, and rated in the "R-1" category by the Dominion Bond Rating
         Service Limited;

                  (3) certificates of deposit and eurodollar time deposits with
         maturities of one year or less from the date of acquisition, bankers'
         acceptances with maturities not exceeding one year and overnight bank
         deposits, in each case, with any domestic commercial bank having
         capital and surplus in excess of US$500.0 million;

                  (4) repurchase obligations with a term of not more than seven
         days for underlying securities of the types described in clauses (2)
         and (3) above entered into with any financial institution meeting the
         qualifications specified in clause (3) above;

                  (5) commercial paper having the highest rating obtainable from
         Moody's Investors Service, Inc. or Standard & Poor's Rating Services
         and in each case maturing within one year after the date of acquisition
         or with respect to commercial paper in Canada, a rating in the "R-1"
         category by the Dominion Bond Rating Service Limited; and

                  (6) money market funds at least 90% of the assets of which
         constitute Cash Equivalents of the kinds described in clauses (1)
         through (5) of this definition.

                  "CHANGE OF CONTROL" means the occurrence of any of the
following:

                                       5


                  (1) the direct or indirect sale, transfer, conveyance or other
         disposition (other than by way of merger or consolidation), in one or a
         series of related transactions, of all or substantially all of the
         properties or assets of the Company and the Restricted Subsidiaries,
         taken as a whole, to any "person" (as that term is used in Section
         13(d)(3) of the Exchange Act) other than a Permitted Holder or a
         Related Party;

                  (2) the adoption of a plan relating to the liquidation or
         dissolution of the Company;

                  (3) the consummation of any transaction (including, without
         limitation, any merger or consolidation) the result of which is that
         any Person, other than a Permitted Holder or a Related Party, becomes
         the Beneficial Owner, directly or indirectly, of more than 50% of the
         Voting Stock of the Company, measured by voting power rather than
         number of shares; or

                  (4) during any consecutive two year period, the first day on
         which individuals who constituted the Board of Directors of the Company
         as of the beginning of such two year period (together with any new
         directors who were nominated for election or elected to such Board of
         Directors with the approval of a majority of the individuals who were
         members of such Board of Directors, or whose nomination or election was
         previously so approved at the beginning of such two-year period) cease
         to constitute a majority of the Board of Directors of the Company.

                  "CLEARSTREAM" means Clearstream Banking S.A. and any successor
thereto.

                  "CODE" means the U.S. Internal Revenue Code of 1986, as
amended.

                  "COMMISSION" means the U.S. Securities and Exchange Commission
and any successor entity thereto.

                  "COMMON STOCK" of any Person means all Capital Stock of such
Person that is generally entitled to (i) vote in the election of directors of
such Person or (ii) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or others
that will control the management and policies of such Person.

                  "COMPANY" means Sun Media Corporation and any successor
thereto.

                  "CONSOLIDATED CASH FLOW" means, with respect to any specified
Person for any period, the Consolidated Net Income of such Person for such
period plus:

                  (1) an amount equal to any extraordinary loss plus any net
         loss realized by such Person or any of its Restricted Subsidiaries in
         connection with an Asset Sale, to the extent such losses were deducted
         in computing such Consolidated Net Income; plus

                  (2) provision for taxes based on income or profits of such
         Person and its Restricted Subsidiaries for such period, to the extent
         that such provision for taxes was deducted in computing such
         Consolidated Net Income; plus

                  (3) Consolidated Interest Expense of such Person and its
         Restricted Subsidiaries for such period to the extent that any such
         expense was deducted in computing such Consolidated Net Income; plus

                  (4) depreciation, amortization (including amortization of
         goodwill and other intangibles) and other non-cash expenses (excluding
         any such non-cash expense to the extent that it represents an accrual
         of or reserve for cash expenses in any future

                                       6



         period) of such Person and its Restricted Subsidiaries for such period,
         to the extent that such depreciation, amortization and other non-cash
         expenses were deducted in computing such Consolidated Net Income; minus

                  (5) any interest and other payments made to Persons other than
         any Sun Media Entity in respect of Back-to-Back Securities or the
         Existing Back-to-Back Debt to the extent such interest and other
         payments were not deducted in computing such Consolidated Net Income;
         minus

                  (6) non-cash items increasing such Consolidated Net Income for
         such period, other than the accrual of revenue in the ordinary course
         of business,

         in each case, on a consolidated basis and determined in accordance with
         GAAP.

                  Notwithstanding the foregoing, the provision for taxes based
on the income or profits of, and the depreciation and amortization and other
non-cash charges of a Restricted Subsidiary shall be added to Consolidated Net
Income to compute Consolidated Cash Flow of the Company only to the extent that
a corresponding amount would be permitted at the date of determination to be
dividended to the Company by such Restricted Subsidiary without prior
governmental approval (unless such approval has been obtained), and without
direct or indirect restriction pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to that Restricted Subsidiary or its
shareholders.

                  "CONSOLIDATED INDEBTEDNESS" means, with respect to any Person
as of any date of determination, the sum, without duplication, of (i) the total
amount of Indebtedness of such Person and its Restricted Subsidiaries, plus (ii)
the total amount of Indebtedness of any other Person, to the extent that such
Indebtedness has been guaranteed by the referent Person or one or more of its
Restricted Subsidiaries, plus (iii) the aggregate liquidation value of all
Disqualified Stock of such Person and all Preferred Shares of Restricted
Subsidiaries of such Person, in each case, determined on a consolidated basis in
accordance with GAAP.

                  "CONSOLIDATED INTEREST EXPENSE" means, with respect to any
Person, for any period, without duplication, the sum of (i) the consolidated
interest expense of such Person and its Restricted Subsidiaries for such period,
whether paid or accrued (including, without limitation, amortization of original
issue discount, non-cash interest payments, the interest component of any
deferred payment Obligations, the interest component of all payments associated
with Capital Lease Obligations, imputed interest with respect to Attributable
Debt, commissions, discounts, and other fees, and charges incurred in respect of
letter of credit or bankers' acceptance financings), all calculated after taking
into account the effect of all Hedging Obligations, (ii) the consolidated
interest expense of such Person and its Restricted Subsidiaries that was
capitalized during such period, (iii) any interest expense on Indebtedness of
another Person that is guaranteed by such Person or any of its Restricted
Subsidiaries or secured by a Lien on assets of such Person or any of its
Restricted Subsidiaries (whether or not such guarantee or Lien is called upon),
(iv) the product of (a) all dividend payments on any series of Preferred Shares
of such Person or any of its Restricted Subsidiaries, times (b) a fraction, the
numerator of which is one and the denominator of which is one minus the then
current combined federal, state, provincial, territorial and local statutory tax
rate of such Person, expressed as a decimal, in each case, on a consolidated
basis and in accordance with GAAP, and (v) to the extent not included in clause
(iv) above for purposes of GAAP, the product of (a) all dividend payments on any
series of Disqualified Stock of such Person or any of its Restricted
Subsidiaries, times (b) a fraction, the numerator of which is one and the
denominator of which is one minus the then current combined federal, state,
provincial, territorial and local statutory tax rate of such Person, expressed
as a decimal, in each case, on a consolidated basis and in accordance with GAAP.
Interest and other payments on Back-to-Back Securities or the Existing
Back-to-Back Debt shall not be included as Consolidated Interest Expense.

                  "CONSOLIDATED NET INCOME" means, with respect to any specified
Person for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; PROVIDED, HOWEVER, that:

                  (1) the Net Income (but not loss) of any Person that is not a
         Restricted Subsidiary (other than an Unrestricted Subsidiary) or that
         is accounted for by the equity


                                       7


         method of accounting shall be included; PROVIDED, that the Net Income
         shall be included only to the extent of the amount of dividends or
         distributions paid in cash to the specified Person or a Restricted
         Subsidiary thereof;

                  (2) the Net Income of any Restricted Subsidiary shall be
         excluded to the extent that the declaration or payment of dividends or
         similar distributions by that Restricted Subsidiary of that Net Income
         is not at the date of determination permitted without any prior
         governmental approval (unless such approval has been obtained) or,
         directly or indirectly, by operation of the terms of its charter or any
         agreement, instrument, judgment, decree, order, statute, rule or
         governmental regulation applicable to that Subsidiary or its
         shareholders;

                  (3) the Net Income of any Person acquired in a pooling of
         interests transaction for any period prior to the date of such
         acquisition shall be excluded;

                  (4) the cumulative effect of a change in accounting
         principles shall be excluded;

                  (5) the Net Income (but not loss) of any Unrestricted
         Subsidiary shall be excluded, whether or not distributed to the
         specified Person or one of its Subsidiaries; PROVIDED, HOWEVER, that
         for purposes of Sections 4.09 and 4.10 hereof, the Net Income of any
         Unrestricted Subsidiary shall be included to the extent it would
         otherwise be included under clause (1) of this definition; and

                  (6) any non-cash compensation expense realized for grants of
         performance shares, stock options or other rights officers, directors
         and employees of the Company or any Restricted Subsidiary shall be
         excluded, PROVIDED that such shares, options or other rights can be
         redeemed at the option of the holders thereof for Capital Stock of the
         Company (other than Disqualified Stock).

                  "CONSOLIDATED REVENUES" means the gross revenues of the
Company and the Restricted Subsidiaries determined on a consolidated basis in
accordance with GAAP; PROVIDED that (1) any portion of gross revenues derived
directly or indirectly from Unrestricted Subsidiaries, including dividends or
distributions from Unrestricted Subsidiaries, shall be excluded from such
calculation, and (2) any portion of gross revenues derived directly or
indirectly from a Person (other than a Subsidiary of the Company or a Restricted
Subsidiary) accounted for by the equity method of accounting shall be included
in such calculation only to the extent of the amount of dividends or
distributions actually paid to the Company or a Restricted Subsidiary by such
Person.

                  "CORPORATE TRUST OFFICE OF THE TRUSTEE" shall be at the
address of the Trustee specified in Section 12.02 hereof, or such other address
as to which the Trustee may give notice to the Company.

                  "CREDIT FACILITIES" means, one or more debt facilities
(including, without limitation, the New Credit Facility) or commercial paper
facilities, in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including through the
sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as amended, restated, modified, renewed, refunded, replaced or refinanced
in whole or in part from time to time.

                  "CURRENCY EXCHANGE PROTECTION AGREEMENT" means, in respect of
a Person, any foreign exchange contract, currency swap agreement, currency
option or other similar agreement or arrangement designed to protect such Person
against fluctuations in currency exchange rates entered into with any commercial
bank or other financial institutions having capital and surplus in excess of
US$500.0 million.

                  "CUSTODIAN" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section
2.03(c) hereof as Custodian with respect to the Notes, and any and all
successors

                                       8


thereto appointed as custodian hereunder and having become such pursuant to the
applicable provisions of this Indenture.

                  "DEBT TO CASH FLOW RATIO" means, as of any date of
determination (the "Determination Date"), the ratio of (a) the Consolidated
Indebtedness of the Company as of such Determination Date to (b) the
Consolidated Cash Flow of the Company for the most recently ended four full
fiscal quarters ending immediately prior to such Determination Date for which
interim financial statements are available (each, a "Measurement Period" and,
together, the "Measurement Periods"), determined on a PRO FORMA basis after
giving effect to all acquisitions or dispositions of assets made by the Company
and the Restricted Subsidiaries from the beginning of the first of such quarters
through and including such Determination Date (including any related financing
transactions) as if such acquisitions and dispositions had occurred at the
beginning of such quarter. For purposes of calculating Consolidated Cash Flow
for each Measurement Period immediately prior to the relevant Determination
Date, (i) any Person that is a Restricted Subsidiary on the Determination Date
(or would become a Restricted Subsidiary on such Determination Date in
connection with the transaction that requires the determination of such
Consolidated Cash Flow) shall be deemed to have been a Restricted Subsidiary at
all times during the applicable Measurement Period; (ii) any Person that is not
a Restricted Subsidiary on such Determination Date (or would cease to be a
Restricted Subsidiary on such Determination Date in connection with the
transaction that requires the determination of such Consolidated Cash Flow)
shall be deemed not to have been a Restricted Subsidiary at any time during the
applicable Measurement Period; (iii) if the Company or any Restricted Subsidiary
shall have in any manner (x) acquired (including through an Asset Acquisition or
the commencement of activities constituting such operating business) or (y)
disposed of (including by way of an Asset Sale or the termination or
discontinuance of activities constituting such operating business) any operating
business during the applicable Measurement Period or after the end of such
period and on or prior to such Determination Date, such calculation shall be
made on a PRO FORMA basis in accordance with GAAP, as if, in the case of an
Asset Acquisition or the commencement of activities constituting such operating
business, all such transactions had been consummated on the first day of the
applicable Measurement Period, and, in the case of an Asset Sale or termination
or discontinuance of activities constituting such operating business, all such
transactions had been consummated prior to the first day of the applicable
Measurement Period; (iv) if (A) since the beginning of the applicable
Measurement Period, the Company or any Restricted Subsidiary has incurred any
Indebtedness that remains outstanding or has repaid any Indebtedness, or (B) the
transaction giving rise to the need to calculate the Debt to Cash Flow Ratio is
an incurrence or repayment of Indebtedness, Consolidated Interest Expense for
such Measurement Period shall be calculated after giving effect on a PRO FORMA
basis to such incurrence or repayment as if such Indebtedness was incurred or
repaid on the first day of such period, PROVIDED that, in the event of any such
repayment of Indebtedness, Consolidated Cash Flow for such period shall be
calculated as if the Company or such Restricted Subsidiary had not earned any
interest income actually earned during such period in respect of the funds used
to repay such Indebtedness; and (v) if any Indebtedness bears a floating rate of
interest and is being given PRO FORMA effect, the interest expense on such
Indebtedness shall be calculated as if the base interest rate in effect for such
floating rate of interest on the Determination Date had been the applicable base
interest rate for the entire Measurement Period (taking into account any
Interest Rate Agreement applicable to such Indebtedness if such Interest Rate
Agreement has a remaining term in excess of twelve months).

                  "DEFAULT" means any event that is, or with the passage of time
or the giving of notice or both would be, an Event of Default.

                  "DEFERRED MANAGEMENT FEES" means, for any period, any
Management Fees that were payable during any prior period, the payment of which
was not effected when due.

                  "DEFINITIVE NOTE" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06 or 2.10
hereof, in substantially the form of Exhibit A hereto except that such Note
shall not bear the Global Note Legend and shall not have the "Schedule of
Exchanges of Interests in the Global Note" attached thereto.

                  "DEPOSITARY" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section
2.03(b) hereof as the Depositary with respect to the Notes, and any and all
successors thereto appointed as depositary hereunder and having become such
pursuant to the applicable provisions of this Indenture

                                       9


                  "DISQUALIFIED STOCK" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case at the option of the holder thereof), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder thereof, in whole or in part, on or prior to the date that is 91 days
after the date on which the Notes mature. Notwithstanding the preceding
sentence, (i) Back-to-Back Preferred Shares shall not constitute Disqualified
Stock and (ii) any Capital Stock that would constitute Disqualified Stock solely
because the holders thereof have the right to require the Company to repurchase
such Capital Stock upon the occurrence of a change of control or an asset sale
shall not constitute Disqualified Stock if the terms of such Capital Stock
provide that the Company may not repurchase or redeem any such Capital Stock
pursuant to such provisions unless such repurchase or redemption complies with
the provisions of Section 4.10 hereof.

                  "DISTRIBUTION COMPLIANCE PERIOD" means the 40-day distribution
compliance period as defined in Regulation S.

                  "EQUITY INTERESTS" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).

                  "EQUITY OFFERING" means an offering by the Company of Equity
Interests (other than Disqualified Stock or Back-to-Back Securities) however
designated and whether voting or non-voting or an equity contribution by a
direct or indirect parent company to the common equity of the Company.

                  "EUROCLEAR" means Euroclear Bank, S.A./N.V., as operator of
the Euroclear systems, and any successor thereto.

                  "EXCHANGE ACT" means the U.S. Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder, including any successor
legislation and rules and regulations.

                  "EXCHANGE NOTES" means Notes registered under the Securities
Act to be exchanged for Notes not so registered, pursuant to and as set forth in
a Registration Rights Agreement relating to such an exchange.

                  "EXCHANGE OFFER" has the meaning set forth in a Registration
Rights Agreement relating to an exchange of Notes registered under the
Securities Act for Notes not so registered.

                  "EXCHANGE OFFER REGISTRATION STATEMENT" has the meaning set
forth in a Registration Rights Agreement.

                  "EXISTING BACK-TO-BACK DEBT" means each of the 12.15%
Convertible Obligation due July 14, 2007 and 12.15% Convertible Obligation due
November 28, 2008 of the Company; the 12.25% Convertible Obligation due July 14,
2007 of Bowes Publishers Limited; and the 12.25% Convertible Obligation due
November 28, 2008 of Sun Media (Toronto) Corporation, in each case in aggregate
principal amount outstanding on the Issue Date and with respect to which each
party thereto, other than a Sun Media Entity, has executed a subordination
agreement in favor of the Holders in substantially the form attached hereto as
Exhibit F.

                  "EXISTING BACK-TO-BACK SECURITIES" means the Existing
Back-to-Back Debt and the Existing Quebecor Preferred Shares.

                  "EXISTING INDEBTEDNESS" means Indebtedness of the Company and
the Restricted Subsidiaries (other than Indebtedness under the New Credit
Facility) in existence on the Issue Date, until such amounts are repaid.

                  "EXISTING QUEBECOR PREFERRED SHARES" means the 12.50%
Cumulative First Preferred Shares, Series A, of Quebecor Media in aggregate
liquidation amount outstanding on the Issue Date.

                  "GAAP" means generally accepted accounting principles
consistently applied as in effect in Canada from time to time.

                                       10


                  "GLOBAL NOTE LEGEND" means the legend set forth in Section
2.06(g)(ii) hereof, which is required to be placed on all Global Notes issued
under this Indenture.

                  "GLOBAL NOTES" means the global Notes in the form of Exhibit A
hereto issued in accordance with Article 2 hereof.

                  "GOVERNMENT SECURITIES" means direct obligations of, or
obligations guaranteed by, either the United States of America or Canada, and
the payment for which either the United States of America or Canada pledges its
full faith and credit.

                  "GUARANTEE" means a guarantee other than by endorsement of
negotiable instruments for collection in the ordinary course of business, direct
or indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.

                  "HEDGING OBLIGATIONS" means, with respect to any specified
Person, the obligations of such Person pursuant to any Interest Rate Agreement
or Currency Exchange Protection Agreement.

                  "HOLDER" means a Person in whose name a Note is registered.

                  "IAI GLOBAL NOTE" means a Global Note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold to Institutional Accredited Investors, if any, to the extent
required by Applicable Procedures.

                  "INCUR" means, with respect to any Indebtedness or other
Obligation of any Person, to create, incur, issue, assume, guarantee or
otherwise become indirectly or directly liable, contingently or otherwise, with
respect of such Indebtedness or other Obligation.

                  "INDEBTEDNESS" means, with respect to any specified Person,
any indebtedness of such Person, whether or not contingent:

                  (1) representing principal of and premium, if any, in respect
         of borrowed money;

                  (2) representing principal of and premium, if any, evidenced
         by bonds, notes, debentures or similar instruments or letters of credit
         (or reimbursement agreements in respect thereof);

                  (3) in respect of bankers' acceptances;

                  (4) representing Capital Lease Obligations of such Person and
         all Attributable Debt in respect of sale and leaseback transactions
         entered into by such Person;

                  (5) representing the balance deferred and unpaid of the
         purchase price of any property, except any such balance that
         constitutes an accrued expense or trade payable;

                  (6) representing the amount of all obligations of such Person
         with respect to the repayment of any Disqualified Stock or, with
         respect to any Subsidiary of such Person, any Preferred Stock (but
         excluding, in each case, any accrued dividends); or

                  (7) representing any Hedging Obligations,

                                       11


if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the guarantee
by the specified Person of any indebtedness of any other Person. The term
"Indebtedness" shall not include Back-to-Back Securities or the Existing
Back-to-Back Securities.

                  The amount of any Indebtedness outstanding as of any date
shall be:

                  (1) the accreted value of the Indebtedness, in the case of any
         Indebtedness issued with original issue discount, and

                  (2) the principal amount thereof, together with any interest
         thereon that is more than 30 days past due, in the case of any other
         Indebtedness;

PROVIDED, HOWEVER, that the amount of any Indebtedness denominated in a currency
other than Canadian dollars shall be adjusted to the extent of any positive or
negative (to the extent the Obligation under such Currency Exchange Protection
Agreement is not otherwise included as Indebtedness of such Person) value of any
Currency Exchange Protection Agreement relating to any such Indebtedness.

                  "INDENTURE" means this instrument, as originally executed or
as it may from time to time be supplemented or amended in accordance with
Article 9 hereof.

                  "INDIRECT PARTICIPANT" means a Person who holds a beneficial
interest in a Global Note through a Participant.

                  "INITIAL NOTES" means US$205.0 million aggregate principal
amount of Notes issued under this Indenture on the date hereof.

                  "INSTITUTIONAL ACCREDITED INVESTOR" means an institution that
is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act.

                  "INTEREST PAYMENT DATES" shall have the meaning set forth in
paragraph 1 of each Note.

                  "INTEREST RATE AGREEMENT" means, for any Person, any interest
rate swap agreement, interest rate cap agreement, interest rate collar agreement
or other similar agreement or arrangement designed to protect against
fluctuations in interest rates entered into with any commercial bank or other
financial institution having capital and surplus in excess of US$500.0 million.

                  "INVESTMENTS" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including guarantees or other Obligations), advances or
capital contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP and include the
designation of a Restricted Subsidiary as an Unrestricted Subsidiary. If the
Company or any Restricted Subsidiary sells or otherwise disposes of any Equity
Interests of any direct or indirect Restricted Subsidiary such that, after
giving effect to any such sale or disposition, such Person is no longer a
Subsidiary of the Company, the Company shall be deemed to have made an
Investment on the date of any such sale or disposition equal to the fair market
value of the Equity Interests of such Subsidiary so sold or disposed of in an
amount determined as provided in Section 4.10(c) hereof. The acquisition by the
Company or any Restricted Subsidiary of a Person that holds an Investment in a
third Person shall be deemed to be an Investment by the Company or such
Restricted Subsidiary in such third Person in an amount equal to the fair market
value of the Investment held by the acquired Person in such third Person in an
amount determined as provided in Section 4.10(c) hereof.

                                       12


                  "ISSUE DATE" means February 7, 2003.

                  "LEGAL HOLIDAY" means a Saturday, a Sunday or a day on which
banking institutions in each of the City of New York, Toronto, the city in which
the Corporate Trust Office of the Trustee is located or any other place of
payment on the Notes are authorized by law, regulation or executive order to
remain closed.

                  "LIEN" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest, hypothecation, assignment for security or
encumbrance of any kind in respect of such asset, whether or not filed, recorded
or otherwise perfected under applicable law, including any conditional sale or
capital lease or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell or give a security interest in
and any filing of or agreement to give any financing statement under the Uniform
Commercial Code (or equivalent statutes) of any jurisdiction.

                   "LETTER OF TRANSMITTAL" means the letter of transmittal, or
its electronic equivalent in accordance with the Applicable Procedures, to be
prepared by the Company and sent to all Holders of the Initial Notes or any
Additional Notes for use by such Holders in connection with an Exchange Offer.

                  "MANAGEMENT FEES" means any amounts payable by the Company or
any Restricted Subsidiary in respect of management or similar services.

                  "NET INCOME" means, with respect to any specified Person, the
net income (loss) of such Person, determined in accordance with GAAP and before
any reduction in respect of Preferred Shares dividends, excluding, however:

                  (1) any gain (but not loss), together with any related
         provision for taxes on such gain (but not loss), realized in connection
         with: (a) any Asset Sale or (b) the disposition of any securities by
         such Person or any of its Restricted Subsidiaries or the extinguishment
         of any Indebtedness of such Person or any of its Restricted
         Subsidiaries; and

                  (2) any extraordinary gain (but not loss), together with any
         related provision for taxes on such extraordinary gain (but not loss).

                  "NET PROCEEDS" means the aggregate cash proceeds received by
the Company or any Restricted Subsidiary in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
(a) the direct costs relating to such Asset Sale, including, without limitation,
legal, accounting and investment banking fees, and sales commissions, (b) any
relocation expenses incurred as a result of the Asset Sale, (c) taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, (d)
amounts required to be applied to the repayment of Indebtedness, other than
Indebtedness under a Credit Facility, secured by a Lien on the asset or assets
that were the subject of such Asset Sale, (e) any reserve for adjustment in
respect of the sale price of such asset or assets established in accordance with
GAAP, and (f) all distributions and other payments required to be made to
minority interest holders in Subsidiaries or joint ventures of the Company or
such Restricted Subsidiary as a result of such Asset Sale; PROVIDED, HOWEVER,
that the proceeds from the sale, transfer or other disposition of all of the
outstanding Capital Stock or all or substantially all of the assets of Toronto
Sun International, Inc. within 180 days of the Issue Date shall not constitute
Net Proceeds.

                  "NEW CREDIT FACILITY" means the credit facility between the
Company, Bank of America, N.A., Banc of America Securities LLC and Credit Suisse
First Boston Corporation, as lead arrangers, Bank of America, N.A., as
administrative agent, and the lenders thereto to be entered into on or prior to
the Issue Date.

                  "NON-RECOURSE DEBT" means Indebtedness:

                  (1) as to which neither the Company nor any Restricted
         Subsidiary (a) provides credit support of any kind (including any
         undertaking, agreement or

                                       13



         instrument that would constitute Indebtedness), (b) is directly or
         indirectly liable as a guarantor or otherwise or (c) constitutes the
         lender;

                  (2) no default with respect to which (including any rights
         that the holders thereof may have to take enforcement action against an
         Unrestricted Subsidiary) would permit upon notice, lapse of time or
         both any holder of any other Indebtedness (other than the Notes ) of
         the Company or any Restricted Subsidiary to declare a default on such
         other Indebtedness or cause the payment thereof to be accelerated or
         payable prior to its Stated Maturity; and

                  (3) as to which the lenders have been notified in writing that
         they will not have any recourse to the stock or assets of the Company
         or any Restricted Subsidiary.

                  "OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.

                  "OFFICER" means the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Operating Officer, the Chief Financial
Officer, the Treasurer, any Assistant Treasurer, the Controller, the Secretary
or any Vice President of the Company.

                  "OFFICERS' CERTIFICATE" means a certificate signed by two
Officers of the Company, at least one of whom shall be the principal executive
officer, principal financial officer or the principal accounting officer of the
Company, and delivered to the Trustee.

                  "OPINION OF COUNSEL" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee. The counsel may be an
employee of or counsel to the Company, an Affiliate of the Company or the
Trustee.

                  "PARTICIPANT" means, with respect to the Depositary, Euroclear
or Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively, and, with respect to DTC, shall include Euroclear and
Clearstream.

                  "PERMITTED BUSINESS" means the business conducted by the
Company and its Subsidiaries on the Issue Date or anything related or ancillary
thereto.

                  "PERMITTED HOLDERS" means one or more of the following persons
or entities:

                  (1) Quebecor Inc.;

                  (2) Quebecor Media;

                  (3) any issue of the late Pierre Peladeau;

                  (4) any trust having as its sole beneficiaries one or more of
         the persons listed in clause (3) above;

                  (5) any corporation, partnership or other entity controlled by
         one or more of the persons or trusts referred to in clause (3) or (4)
         above or in this clause (5); and

                  (6) Capital Communications CDPQ Inc.

                  "PERMITTED INVESTMENTS" means:

                  (1) any Investment in the Company or in a Restricted
         Subsidiary;

                                       14


                  (2) any Investment in cash or Cash Equivalents;

                  (3) any Investment by the Company or any Restricted Subsidiary
         in a Person, if as a result of such Investment:

                           (a) such Person becomes a Restricted Subsidiary; or

                           (b) such Person is merged, consolidated or
                  amalgamated with or into, or transfers or conveys
                  substantially all of its assets to, or is liquidated into, the
                  Company or any Restricted Subsidiary,

                  PROVIDED that, in each case, such Person's primary business is
a Permitted Business;

                  (4) any Investment made as a result of the receipt of non-cash
         consideration from an Asset Sale that was made pursuant to and in
         compliance with the provisions of Section 4.12 hereof;

                  (5) any acquisition of assets solely in exchange for the
         issuance of Equity Interests (other than Disqualified Stock or
         Back-to-Back Securities) of the Company;

                  (6) Hedging Obligations entered into in the ordinary course of
         business of the Company or any Restricted Subsidiary and not for
         speculative purposes;

                  (7) loans and advances to officers, directors and employees of
         the Company and the Restricted Subsidiaries for business related travel
         expenses, moving expenses and other similar expenses in each case
         incurred in the ordinary course of business not to exceed US$2.5
         million outstanding at any time;

                  (8) any Investment in connection with Back-to-Back
         Transactions;

                  (9) any Investment existing on the Issue Date;

                  (10) other Investments in any Person engaged in a Permitted
         Business having an aggregate fair market value (measured on the date
         each such Investment was made and without giving effect to subsequent
         changes in value), when taken together with all other Investments made
         pursuant to this clause (10) since the Issue Date not to exceed US$25.0
         million; and

                  (11) other Investments in any Person having an aggregate fair
         market value (measured on the date each such Investment was made and
         without giving effect to subsequent changes in value), when taken
         together with all other Investments made pursuant to this clause (11)
         since the Issue Date not to exceed US$10.0 million.

                  "PERMITTED LIENS" means:

                  (1) Liens of Restricted Subsidiaries securing Indebtedness and
         other Obligations of Restricted Subsidiaries under Credit Facilities,
         which Indebtedness was permitted by the terms of this Indenture to be
         incurred, PROVIDED, HOWEVER, that the aggregate principal amount of
         such Indebtedness secured by such Liens shall not exceed an aggregate
         of (a) US$230.0 million and (b) Cdn$75.0 million at any one time
         outstanding;

                  (2) Liens in favor of the Company or a Restricted Subsidiary;

                                       15


                  (3) Liens on property of a Person existing at the time such
         Person is merged with or into or consolidated with the Company or any
         Restricted Subsidiary, PROVIDED that such Liens were in existence prior
         to the contemplation of such merger or consolidation and do not extend
         to any assets other than those of the Person merged into or
         consolidated with the Company or the Restricted Subsidiary;

                  (4) Liens on property existing at the time of acquisition
         thereof by the Company or any Restricted Subsidiary, PROVIDED that such
         Liens were in existence prior to the contemplation of such acquisition
         and do not extend to any assets other than such property;

                  (5) Liens to secure the performance of statutory obligations,
         surety or appeal bonds, performance bonds or other obligations of a
         like nature incurred in the ordinary course of business;

                  (6) Liens to secure Indebtedness (including Capital Lease
         Obligations) permitted by Section 4.09(b)(4) hereof covering only the
         assets acquired with such Indebtedness;

                  (7) Liens existing on the Issue Date;

                  (8) Liens for taxes, assessments or governmental charges or
         claims that are not yet delinquent or that are being contested in good
         faith by appropriate proceedings promptly instituted and diligently
         concluded, PROVIDED that any reserve or other appropriate provision as
         shall be required in conformity with GAAP shall have been made
         therefor;

                  (9) Liens securing Permitted Refinancing Indebtedness,
         PROVIDED that any such Lien does not extend to or cover any property,
         Capital Stock or Indebtedness other than the property, shares or debt
         securing the Indebtedness so refunded, refinanced or extended;

                  (10) attachment or judgment Liens not giving rise to a Default
         or an Event of Default;

                  (11) Liens incurred or deposits made in the ordinary course of
         business in connection with workers' compensation, unemployment
         insurance and other types of social security;

                  (12) Liens incurred or deposits made to secure the performance
         of tenders, bids, leases, statutory or regulatory obligations, bankers'
         acceptance, surety and appeal bonds, government contracts, performance
         and return-of-money bonds and other obligations of a similar nature
         incurred in the ordinary course of business, exclusive of Obligations
         for the payment of borrowed money;

                  (13) Liens of franchisors or other regulatory bodies arising
         in the ordinary course of business;

                  (14) Liens securing reimbursement obligations with respect to
         letters of credit that encumber documents and other property relating
         to such letters of credit and the products and proceeds thereof;

                  (15) Liens encumbering customary initial deposits and margin
         deposits, and other Liens that are within the general parameters
         customary in the industry and incurred in the ordinary course of
         business, in each case, securing Indebtedness under Hedging


                                       16



         Obligations and forward contracts, options, future contracts, future
         options or similar agreements or arrangements, including mark-to-market
         transactions designed solely to protect the Company or any Restricted
         Subsidiary from fluctuations in interest rates, currencies or the price
         of commodities;

                  (16) Liens consisting of any interest or title of licensor in
         the property subject to a license;

                  (17) Liens on the Capital Stock of Unrestricted Subsidiaries;

                  (18) Liens arising from sales or other transfers of accounts
         receivable which are past due or otherwise doubtful of collection in
         the ordinary course of business;

                  (19) Liens securing Indebtedness permitted to be incurred
         under Section 4.09(b)(12) hereof;

                  (20) any extensions, substitutions, replacements or renewals
         of the foregoing clauses (1) through (19); and

                  (21) Liens incurred in the ordinary course of business of the
         Company or any Restricted Subsidiary with respect to Obligations that
         do not exceed US$25 million at any one time outstanding.

                  "PERMITTED REFINANCING INDEBTEDNESS" means any Indebtedness of
the Company or any Restricted Subsidiary issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any Subsidiary Guarantor (other than
intercompany Indebtedness); PROVIDED, HOWEVER, that:

                  (1) the principal amount (or accreted value, if applicable) of
         such Permitted Refinancing Indebtedness does not exceed the principal
         amount (or accreted value, if applicable) of the Indebtedness so
         extended, refinanced, renewed, replaced, defeased or refunded (plus all
         accrued interest thereon and the amount of all expenses and premiums
         incurred in connection therewith);

                  (2) such Permitted Refinancing Indebtedness has a final
         maturity date later than the final maturity date of, and has a Weighted
         Average Life to Maturity equal to or greater than the Weighted Average
         Life to Maturity of, the Indebtedness being extended, refinanced,
         renewed, replaced, defeased or refunded;

                  (3) if the Indebtedness being extended, refinanced, renewed,
         replaced, defeased or refunded is subordinated in right of payment to
         the Notes, such Permitted Refinancing Indebtedness is subordinated in
         right of payment to, the Notes on terms at least as favorable to the
         Holders of Notes as those contained in the documentation governing the
         Indebtedness being extended, refinanced, renewed, replaced, defeased or
         refunded; and

                  (4) such Indebtedness is incurred either by the Company or by
         the Restricted Subsidiary who is the obligor on the Indebtedness being
         extended, refinanced, renewed, replaced, defeased or refunded.

                  "PERSON" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.

                  "PREDECESSOR NOTE" of any particular Note means every previous
Note evidencing all or a portion of the same Indebtedness as that evidenced by
such particular Note; and any Note authenticated and delivered under


                                       17


Section 2.07 in lieu of a lost, destroyed or stolen Note shall be deemed to
evidence the same Indebtedness as the lost, destroyed or stolen Note.

                  "PREFERRED SHARES" means any Capital Stock of a Person,
however designated, which entitles the holder thereof to a preference with
respect to the payment of dividends, or as to the distribution of assets upon
any voluntary or involuntary liquidation or dissolution of such Person, over
shares of any other class of Capital Stock issued by such Person.

                  "PRIVATE PLACEMENT LEGEND" means the legend set forth in
Section 2.06(g)(i) hereof to be placed on all Notes issued under this Indenture
except as otherwise permitted by the provisions of this Indenture.

                  "QIB" means a "qualified institutional buyer" as defined in
Rule 144A.

                  "QUEBECOR MEDIA" means Quebecor Media Inc., the indirect
parent of the Company.

                  "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of the Issue Date, among the Company, each Subsidiary
Guarantor and the initial purchasers named therein, as such agreement may be
amended, modified or supplemented from time to time and, with respect to any
Additional Notes, one or more registration rights agreements between the Company
and the other parties thereto, as such agreement(s) may be amended, modified or
supplemented from time to time, relating to rights given by the Company to the
purchasers of Additional Notes to register such Additional Notes, or exchange
such Additional Notes for registered notes, under the Securities Act.

                  "REGULAR RECORD DATE" for the interest payable on any Interest
Payment Date means the applicable date specified as a "Record Date" on the face
of the Note.

                  "REGULATION S" means Regulation S promulgated under the
Securities Act.

                  "REGULATION S GLOBAL NOTE" means a Global Note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with and registered in the name of the Depositary or its nominee
that will be issued in a denomination equal to the outstanding principal amount
of the Notes sold for initial resale in reliance on Rule 904.

                  "RELATED PARTY" means:

                  (1) any controlling shareholder, 80% (or more) owned
         Subsidiary, or immediate family member (in the case of an individual)
         of any Permitted Holder, or

                  (2) any trust, corporation, partnership or other entity, the
         beneficiaries, shareholders, partners, owners or Persons beneficially
         holding an 80% or more controlling interest of which consist of any one
         or more Permitted Holder and/or such other Persons referred to in the
         immediately preceding clause (1).

                  "RESPONSIBLE OFFICER," when used with respect to the Trustee,
means any officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject.

                  "RESTRICTED DEFINITIVE NOTE" means one or more Definitive
Notes bearing the Private Placement Legend.

                  "RESTRICTED GLOBAL NOTES" means 144A Global Notes, IAI Global
Notes and Regulation S Global Notes.

                  "RESTRICTED INVESTMENT" means an Investment other than a
Permitted Investment.


                                       18


                  "RESTRICTED PAYMENT" means:

                  (1) the declaration or payment of any dividend or making any
         other payment or distribution on account of the Company's or any
         Restricted Subsidiary's Equity Interests, including, without
         limitation, any payment in connection with any merger or consolidation
         involving the Company or any Restricted Subsidiary, or to the direct or
         indirect holders of the Company's or any Restricted Subsidiary's Equity
         Interests in their capacity as such, other than dividends or
         distributions payable in Equity Interests (other than Disqualified
         Stock) of the Company or to the Company or a Restricted Subsidiary
         (and, if such Restricted Subsidiary is not a Wholly Owned Restricted
         Subsidiary, to the other shareholders of such Restricted Subsidiary on
         a PRO RATA basis or on a basis that results in the receipt by the
         Company or a Restricted Subsidiary of dividends or distributions of
         greater value than it would receive on a PRO RATA basis);

                  (2) the purchase, redemption or other acquisition or
         retirement for value, including, without limitation, in connection with
         any merger or consolidation involving the Company, any Equity Interests
         of the Company, other than such Equity Interests of the Company held by
         the Company or any of its Affiliates, including any Restricted
         Subsidiary;

                  (3) any payment on or with respect to, or purchase,
         redemption, defeasance or other acquisition or retirement for value any
         Back-to-Back Securities, Existing Back-to-Back Securities or
         Indebtedness that is subordinated to the Notes, except, in the case of
         Indebtedness that is subordinated to the Notes, a payment of interest
         at the Stated Maturity of such interest or principal at or within one
         year of the Stated Maturity of principal of such Indebtedness;

                  (4) any Restricted Investment; or

                  (5) the payment of any amount of Management Fees (including
         Deferred Management Fees) to a Person other than the Company or a
         Restricted Subsidiary.

                  "RESTRICTED SUBSIDIARY" means any Subsidiary of the Company
that is not an Unrestricted Subsidiary.

                  "RULE 144" means Rule 144 promulgated under the Securities
Act.

                  "RULE 144A" means Rule 144A promulgated under the Securities
Act.

                  "RULE 903" means Rule 903 promulgated under the Securities
Act.

                  "RULE 904" means Rule 904 promulgated under the Securities
Act.

                  "SECURITIES ACT" means the U.S. Securities Act of 1933, as
amended, and the rules and regulations thereunder, including any successor
legislation and rules and regulations.

                  "SHELF REGISTRATION STATEMENT" has the meaning set forth in
any Registration Rights Agreement relating to registering Notes under the
Securities Act.

                  "SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the Issue Date.

                  "SPECIAL INTEREST" has the meaning set forth in any
Registration Rights Agreement and relating to amounts to be paid in the event
the Company fails to satisfy certain conditions set forth therein. For all
purposes of this Indenture, the term "interest" shall include Special Interest,
if any, with respect to the Notes.


                                       19


                  "STATED MATURITY" means, with respect to any installment of
interest or principal on any series of Indebtedness, the date on which such
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and shall not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.

                  "SUBORDINATED INDEBTEDNESS" means any Indebtedness of the
Company or its Subsidiaries (whether outstanding on the Issue Date or thereafter
incurred) that is subordinate or junior in right of payment to the Notes
pursuant to a written agreement to that effect.

                  "SUBSIDIARY" means, with respect to any specified Person:

                  (1) any corporation, association or other business entity of
         which more than 50% of the total voting power of shares of Capital
         Stock entitled (without regard to the occurrence of any contingency) to
         vote in the election of directors, managers or trustees thereof is at
         the time owned or controlled, directly or indirectly, by such Person or
         one or more of the other Subsidiaries of that Person (or a combination
         thereof); and

                  (2) any partnership (a) the sole general partner or the
         managing general partner of which is such Person or a Subsidiary of
         such Person or (b) the only general partners of which are such Person
         or one or more Subsidiaries of such Person (or any combination
         thereof).

                  "SUBSIDIARY GUARANTEE" means a guarantee on the terms set
forth in this Indenture by a Subsidiary Guarantor of the Company's obligations
with respect to the Notes.

                  "SUBSIDIARY GUARANTOR" means each Restricted Subsidiary and
any other Person that becomes a Subsidiary Guarantor pursuant to the provisions
of Section 4.19 hereof or who otherwise executes and delivers a supplemental
indenture to the Trustee providing for a Subsidiary Guarantee.

                  "SUN MEDIA ENTITY" means any of the Company or any Subsidiary
Guarantor.

                  "TAX" means any tax, duty, levy, impost, assessment or other
governmental charge (including penalties, interest and any other liabilities
related thereto).

                  "TAX BENEFIT TRANSACTION" means, for so long as the Company is
a direct or indirect Subsidiary of Quebecor Inc., any transaction between a Sun
Media Entity and Quebecor Inc. or any of its Affiliates, the primary purpose of
which is to create tax benefits for any Sun Media Entity or for Quebecor Inc. or
any of its Affiliates; PROVIDED, HOWEVER, that (1) the Sun Media Entity involved
in the transaction obtains a favorable tax ruling from a competent tax authority
or a favorable tax opinion from a nationally recognized Canadian law or
accounting firm having a tax practice of national standing as to the tax
efficiency of the transaction for such Sun Media Entity; (2) the Company
delivers to the Trustee (a) a resolution of the Board of Directors of the
Company to the effect the transaction will not prejudice the noteholders and
certifying that such transaction has been approved by a majority of the
disinterested members of such Board of Directors and (b) an opinion as to the
fairness to such Sun Media Entity of such transaction from a financial point of
view issued by an accounting, appraisal or investment banking firm of national
standing in the United States or Canada; (3) such transaction is set forth
writing; and (4) the Consolidated Cash Flow of the Company is not reduced after
giving PRO FORMA effect to the transaction as if the same had occurred at the
beginning of the most recently ended four fiscal quarter period of the Company
for which internal financial statements are available; PROVIDED, HOWEVER, that
if such transaction shall thereafter cease to satisfy the preceding requirements
as a Tax Benefit Transaction, it shall thereafter cease to be a Tax Benefit
Transaction for purposes of this Indenture and shall be deemed to have been
effected as of such date and, if the transaction is not otherwise permitted by
this Indenture as of such date, the Company shall be in default under this
Indenture if such transaction does not comply with the preceding requirements or
is not otherwise unwound within 30 days of that date.


                                       20


                  "TIA" means the U.S. Trust Indenture Act of 1939, as amended,
and the rules and regulations thereunder, including any successor legislation
and rules and regulations.

                  "TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.

                  "UNRESTRICTED DEFINITIVE NOTES" means one or more Definitive
Notes that do not and are not required to bear the Private Placement Legend.

                  "UNRESTRICTED GLOBAL NOTES" means one or more Global Notes
that do not and are not required to bear the Private Placement Legend and are
deposited with and registered in the name of the Depositary or its nominee.

                  "UNRESTRICTED SUBSIDIARY" means:

                  (1) any Subsidiary of the Company that is designated after the
         Issue Date as an Unrestricted Subsidiary as permitted or required
         pursuant to the provisions of Section 4.17 hereof and is not thereafter
         redesignated as a Restricted Subsidiary as permitted pursuant thereto;
         and

                  (2) any Subsidiary of an Unrestricted Subsidiary.

                  "VOTING STOCK" of any Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.

                  "WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:

                  (1) the sum of the products obtained by multiplying (a) the
         amount of each then remaining installment, sinking fund, serial
         maturity or other required payments of principal, including payment at
         final maturity, in respect thereof, by (b) the number of years
         (calculated to the nearest one-twelfth) that will elapse between such
         date and the making of such payment; by

                  (2) the then outstanding principal amount of such
         Indebtedness.

                  "WHOLLY OWNED RESTRICTED SUBSIDIARY" of any specified Person
means a Restricted Subsidiary of such Person all of the outstanding Capital
Stock or other ownership interests of which (other than directors' qualifying
shares) will at the time be owned by such Person or by one or more Wholly Owned
Restricted Subsidiaries of such Person.

SECTION 1.02.     OTHER DEFINITIONS.



                                                                                     Defined in
                 Term                                                                Section
                 ----                                                                -------
                                                                                  
                 "Acceleration Notice".........................................      6.02
                 "Additional Amounts"..........................................      4.20(a)(3)
                 "Affiliate Transaction".......................................      4.14(a)
                 "Allocable Excess Proceeds"...................................      4.12(e)
                 "Asset Sale Offer"............................................      4.12(e)
                 "Authentication Order"........................................      2.02(d)
                 "Base Currency"...............................................      12.13(a)
                 "Benefited Party".............................................      10.01
                 "Change of Control Offer".....................................      4.18(a)
                 "Change of Control Amount"....................................      4.18(a)


                                       21

                                                                
                 "Covenant Defeasance".........................................      8.03
                 "DTC".........................................................      2.03(b)
                 "Event of Default"............................................      6.01
                 "Excess Proceeds".............................................      4.12
                 "Excluded Holder".............................................      4.20(b)
                 "First Currency"..............................................      12.14
                 "judgment currency"...........................................      12.13(a)
                 "Legal Defeasance"............................................      8.02
                 "losses" .....................................................      7.07
                 "Offer Amount"................................................      3.09(b)(ii)
                 "Offer Period"................................................      3.09(c)
                 "Offer to Purchase"...........................................      3.09(a)
                 "Paying Agent"................................................      2.03(a)
                 "Payment Default".............................................      6.01(v)(a)
                 "Permitted Debt"..............................................      4.09(b)
                 "Purchase Date"...............................................      3.09(c)
                 "rate(s) of exchange".........................................      12.13
                 "Registrar"...................................................      2.03(a)
                 "Security Register"...........................................      3.03
                 "Surviving Company"...........................................      5.01(a)(1)
                 "Surviving Guarantor".........................................      5.01(b)(1)

                  


SECTION 1.03      INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.

                  (a) Whenever this Indenture refers to a provision of the TIA,
the provision is incorporated by reference in and made a part of this Indenture.

                  (b) The following TIA terms used in this Indenture have the
following meanings:

                  "INDENTURE SECURITIES" means the Notes;

                  "INDENTURE SECURITY HOLDER" means a Holder of a Note;

                  "INDENTURE TO BE QUALIFIED" means this Indenture;

                  "INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the
Trustee; and

                  "OBLIGOR" on the Notes means the Company and any successor
obligor upon the Notes.

                  (c) All other terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by Commission
rule under the TIA and not otherwise defined herein have the meanings so
assigned to them.

SECTION 1.04.     RULES OF CONSTRUCTION.

                  (a) Unless the context otherwise requires:

                      (i) a term has the meaning assigned to it;

                     (ii) an accounting term not otherwise defined herein has
         the meaning assigned to it in accordance with GAAP;

                    (iii) "or" is not exclusive;


                                       22


                     (iv) words in the singular include the plural, and in the
         plural include the singular;

                      (v) all references in this instrument to "Articles,"
         "Sections" and other subdivisions are to the designated Articles,
         Sections and subdivisions of this instrument as originally executed;

                     (vi) the words "herein," "hereof" and "hereunder" and other
         words of similar import refer to this Indenture as a whole and not
         to any particular Article, Section or other subdivision.

                    (vii) "including" means "including without limitation;"

                   (viii) provisions apply to successive events and
         transactions; and

                     (ix) references to sections of or rules under the
         Securities Act, the Exchange Act or the TIA shall be deemed to include
         substitute, replacement or successor sections or rules adopted by the
         Commission from time to time thereunder.

                                   ARTICLE 2.

                                   THE NOTES

SECTION 2.01.     FORM AND DATING.

         (a) GENERAL. The Notes and the Trustee's certificate of authentication
shall be substantially in the form included in Exhibit A hereto, which is hereby
incorporated in and expressly made part of this Indenture. The Notes may have
notations, legends or endorsements required by law, exchange rule or usage in
addition to those set forth on Exhibit A. Each Note shall be dated the date of
its authentication. The Notes shall be in denominations of US$1,000 and integral
multiples thereof. The terms and provisions contained in the Notes shall
constitute a part of this Indenture, and the Company, the Subsidiary Guarantors
and the Trustee, by their execution and delivery of this Indenture, expressly
agree to such terms and provisions and to be bound thereby. To the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.

         (b) FORM OF NOTES. Notes shall be issued initially in global form and
shall be substantially in the form of Exhibit A attached hereto (including the
Global Note Legend thereon and the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Notes issued in definitive form shall be
substantially in the form of Exhibit A attached hereto (but without the Global
Note Legend thereon and without the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Each Global Note shall represent such aggregate
principal amount of the outstanding Notes as shall be specified therein and each
shall provide that it shall represent the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the aggregate
principal amount of outstanding Notes represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and redemptions
and transfers of interests therein. Any endorsement of a Global Note to reflect
the amount of any increase or decrease in the aggregate principal amount of
outstanding Notes represented thereby shall be made by the Trustee or the
Custodian, at the direction of the Trustee, in accordance with instructions
given by the Holder thereof as required by Section 2.06 hereof.

         (c) BOOK-ENTRY PROVISIONS. This Section 2.01(c) shall apply only to
Global Notes deposited with the Trustee, as custodian for the Depositary.
Participants and Indirect Participants shall have no rights under this Indenture
or any Global Note with respect to any Global Note held on their behalf by the
Depositary or by the Trustee as custodian for the Depositary, and the Depositary
shall be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner of such Global Note for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depositary
or impair, as between the Depositary and its Participants or Indirect
Participants, the Applicable Procedures or the operation of customary practices
of the Depositary governing the exercise of the rights of a holder of a
beneficial interest in any Global Note.


                                       23


         (d) EUROCLEAR AND CLEARSTREAM PROCEDURES APPLICABLE. The provisions of
the "Operating Procedures of the Euroclear System" and "Terms and Conditions
Governing Use of Euroclear" and the "General Terms and Conditions of
Clearstream" and "Customer Handbook" of Clearstream shall be applicable to
transfers of beneficial interests in Global Notes that are held by Participants
through Euroclear or Clearstream.

SECTION 2.02.     EXECUTION AND AUTHENTICATION.

         (a) One Officer shall execute the Notes on behalf of the Company by
manual or facsimile signature.

         (b) If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated by the Trustee, the Note shall
nevertheless be valid.

         (c) A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.

         (d) The Trustee shall, upon a written order of the Company signed by an
Officer (an "AUTHENTICATION ORDER"), authenticate Notes for original issue.

         (e) The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Notes. Unless otherwise provided in such appointment, an
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent shall have the same rights
as an Agent with respect to Holders.

SECTION 2.03.     REGISTRAR AND PAYING AGENT.

         (a) The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("REGISTRAR") and an
office or agency where Notes may be presented for payment ("PAYING AGENT"). The
Registrar shall keep a register of the Notes and of their transfer and exchange.
The Company may appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and the term
"Paying Agent" includes any additional paying agent. The Company may change any
Paying Agent or Registrar without notice to any Holder. The Company shall notify
the Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.

         (b) The Company initially appoints The Depository Trust Company ("DTC")
to act as Depositary with respect to the Global Notes.

         (c) The Company initially appoints the Trustee to act as Registrar and
Paying Agent and to act as Custodian with respect to the Global Notes, and the
Trustee hereby agrees so to initially act.

SECTION 2.04.     PAYING AGENT TO HOLD MONEY IN TRUST.

         The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
principal, premium, if any, or interest on the Notes, and shall notify the
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all funds held
by it relating to the Notes to the Trustee. The Company at any time may require
a Paying Agent to pay all funds held by it relating to the Notes to the Trustee.
Upon payment over to the Trustee, the Paying Agent (if other than the Company or
a Subsidiary) shall have no further liability for such funds. If the Company or
a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate
trust fund for the benefit of the Holders all funds held by it as Paying Agent.
Upon any Event of Default under Sections 6.01(viii) and (ix) hereof relating to
the Company, the Trustee shall serve as Paying Agent for the Notes.


                                       24


SECTION 2.05.     HOLDER LISTS.

         The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA Section 312(a). If the Trustee
is not the Registrar, the Company shall furnish to the Trustee at least seven
Business Days before each Interest Payment Date and at such other times as the
Trustee may request in writing, a list in such form and as of such date or such
shorter time as the Trustee may allow, as the Trustee may reasonably require of
the names and addresses of the Holders and the Company shall otherwise comply
with TIA Section 312(a).

SECTION 2.06.     TRANSFER AND EXCHANGE.

         (a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may not be
transferred as a whole except by the Depositary to a nominee of the Depositary,
by a nominee of the Depositary to the Depositary or to another nominee of the
Depositary, or by the Depositary or any such nominee to a successor Depositary
or a nominee of such successor Depositary. The Company shall exchange Global
Notes for Definitive Notes if: (1) the Company delivers to the Trustee a notice
from the Depositary that the Depositary is unwilling or unable to continue to
act as Depositary for the Global Notes or that it has ceased to be a clearing
agency registered under the Exchange Act and, in either case, a successor
Depositary is not appointed by the Company within 120 days after the date of
such notice from the Depositary; (2) the Company at its option determines that
the Global Notes shall be exchanged for Definitive Notes and delivers a written
notice to such effect to the Trustee; or (3) a Default or Event of Default shall
have occurred and be continuing. Upon the occurrence of any of the preceding
events in clauses (1), (2) or (3) above, Definitive Notes shall be issued in
denominations of US$1,000 or integral multiples thereof and in such names as the
Depositary shall instruct the Trustee in writing. Global Notes also may be
exchanged or replaced, in whole or in part, as provided in Sections 2.07 and
2.10 hereof. Except as provided above, every Note authenticated and delivered in
exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to
this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and
delivered in the form of, and shall be, a Global Note. A Global Note may not be
exchanged for another Note other than as provided in this Section 2.06(a), and
beneficial interests in a Global Note may not be transferred and exchanged other
than as provided in Section 2.06(b), (c) or (f) hereof.

         (b) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN THE GLOBAL NOTES.
The transfer and exchange of beneficial interests in the Global Notes shall be
effected through the Depositary in accordance with the provisions of this
Indenture and the Applicable Procedures. Beneficial interests in Restricted
Global Notes shall be subject to restrictions on transfer comparable to those
set forth herein to the extent required by the Securities Act. Transfers of
beneficial interests in Global Notes also shall require compliance with either
clause (i) or (ii) below, as applicable, as well as one or more of the other
following clauses, as applicable:

             (i) TRANSFER OF BENEFICIAL INTERESTS IN THE SAME GLOBAL NOTE.
     Beneficial interests in any Restricted Global Note may be transferred to
     Persons who take delivery thereof in the form of a beneficial interest in
     the same Restricted Global Note in accordance with the transfer
     restrictions set forth in the Private Placement Legend and any Applicable
     Procedures; PROVIDED, HOWEVER, that prior to the expiration of the
     Distribution Compliance Period, transfers of beneficial interests in
     Regulation S Global Note may not be made to or for the account or benefit
     of a "U.S. Person" (as defined in Rule 902(k) of Regulation S) (other than
     a "distributor" (as defined in Rule 902(d) of Regulation S)). Beneficial
     interests in any Unrestricted Global Note may be transferred to Persons who
     take delivery thereof in the form of a beneficial interest in an
     Unrestricted Global Note. Except as may be required by any Applicable
     Procedures, no written orders or instructions shall be required to be
     delivered to the Registrar to effect the transfers described in this
     Section 2.06(b)(i).

             (ii) ALL OTHER TRANSFERS AND EXCHANGES OF BENEFICIAL INTERESTS IN
     GLOBAL NOTES. In connection with all transfers and exchanges of beneficial
     interests that are not subject to Section 2.06(b)(i) above, the transferor
     of such beneficial interest must deliver to the Registrar either (A)(1) a
     written order from a Participant or an Indirect Participant given to the
     Depositary in accordance with the Applicable Procedures directing the
     Depositary to credit or cause to be credited a beneficial interest in
     another Global Note in an amount equal to the beneficial interest to be
     transferred or exchanged and (2) instructions given in accordance with the
     Applicable Procedures containing information regarding the Participant
     account to be


                                       25



     credited with such increase or (B) if permitted under Section 2.06(a)
     hereof, (1) a written order from a Participant or an Indirect Participant
     given to the Depositary in accordance with the Applicable Procedures
     directing the Depositary to cause to be issued a Definitive Note in an
     amount equal to the beneficial interest to be transferred or exchanged and
     (2) instructions given by the Depositary to the Registrar containing
     information regarding the Person in whose name such Definitive Note shall
     be registered to effect the transfer or exchange referred to in (B)(1)
     above. Upon consummation of an Exchange Offer by the Company in accordance
     with Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii)
     shall be deemed to have been satisfied upon receipt by the Registrar of the
     instructions contained in the Letter of Transmittal delivered by the Holder
     of such beneficial interests in the Restricted Global Notes. Upon
     satisfaction of all of the requirements for transfer or exchange of
     beneficial interests in Global Notes contained in this Indenture and the
     Notes or otherwise applicable under the Securities Act, the Trustee shall
     adjust the principal amount of the relevant Global Note(s) pursuant to
     Section 2.06(h) hereof.

             (iii) TRANSFER OF BENEFICIAL INTERESTS IN A RESTRICTED GLOBAL NOTE
     TO ANOTHER RESTRICTED GLOBAL NOTE. A beneficial interest in any Restricted
     Global Note may be transferred to a Person who takes delivery thereof in
     the form of a beneficial interest in another Restricted Global Note if the
     transfer complies with the requirements of Section 2.06(b)(ii) above and
     the Registrar receives the following:

                   (A) if the transferee will take delivery in the form of a
         beneficial interest in a 144A Global Note, then the transferor must
         deliver a certificate in the form of Exhibit B hereto, including the
         certifications in item (1) thereof or, if permitted by Applicable
         Procedures, item (3) thereof; and

                   (B) if the transferee will take delivery in the form of a
         beneficial interest in a Regulation S Global Note, then the transferor
         must deliver a certificate in the form of Exhibit B hereto, including
         the certifications in item (2) thereof; and

                   (C) if the transferee is required by Applicable Procedures to
         take delivery in the form of a beneficial interest in an IAI Global
         Note, then the transferor must deliver a certificate in the form of
         Exhibit B hereto, including the certifications and certificates and
         Opinion of Counsel required by item (3) thereof, if applicable.

             (iv) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN A RESTRICTED
     GLOBAL NOTE FOR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL NOTE. A
     beneficial interest in any Restricted Global Note may be exchanged by any
     holder thereof for a beneficial interest in an Unrestricted Global Note or
     transferred to a Person who takes delivery thereof in the form of a
     beneficial interest in an Unrestricted Global Note only if the exchange or
     transfer complies with the requirements of Section 2.06(b)(ii) above and:

                   (A) such exchange or transfer is effected pursuant to an
         Exchange Offer in accordance with a Registration Rights Agreement and
         the holder of the beneficial interest to be transferred, in the case of
         an exchange, or the transferee, in the case of a transfer, makes any
         and all certifications in the applicable Letter of Transmittal (or is
         deemed to have made such certifications if delivery is made through the
         Applicable Procedures) as may be required by such Registration Rights
         Agreement;

                   (B) such transfer is effected pursuant to a Shelf
         Registration Statement in accordance with a Registration Rights
         Agreement;

                   (C) such transfer is effected by a broker-dealer pursuant to
         an Exchange Offer Registration Statement in accordance with a
         Registration Rights Agreement; or


                                       26


                   (D) the Registrar receives the following:

                   (1) if the holder of such beneficial interest in a Restricted
         Global Note proposes to exchange such beneficial interest for a
         beneficial interest in an Unrestricted Global Note, a certificate from
         such holder in the form of Exhibit C hereto, including the
         certifications in item (1)(a) thereof; or

                   (2) if the holder of such beneficial interest in a Restricted
         Global Note proposes to transfer such beneficial interest to a Person
         who shall take delivery thereof in the form of a beneficial interest in
         an Unrestricted Global Note, a certificate from such holder in the form
         of Exhibit B hereto, including the certifications in item (4) thereof;

         and, in each such case set forth in this clause (D), if the Registrar
         so requests or if the Applicable Procedures so require, an Opinion of
         Counsel in form reasonably acceptable to the Registrar to the effect
         that such exchange or transfer shall be effected in compliance with the
         Securities Act and that the restrictions on transfer contained herein
         and in the Private Placement Legend shall no longer be required in
         order to maintain compliance with the Securities Act.

         If any such transfer is effected pursuant to clause (B) or (D) above at
a time when an Unrestricted Global Note has not yet been issued, the Company
shall execute and, upon receipt of an Authentication Order in accordance with
Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the aggregate principal
amount of beneficial interests transferred pursuant to clause (B) or (D) above.

             (v) TRANSFER OR EXCHANGE OF BENEFICIAL INTERESTS IN UNRESTRICTED
     GLOBAL NOTES FOR BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES
     PROHIBITED. Beneficial interests in an Unrestricted Global Note may not be
     exchanged for, or transferred to Persons who take delivery thereof in the
     form of, beneficial interests in a Restricted Global Note.

         (c) TRANSFER OR EXCHANGE OF BENEFICIAL INTERESTS FOR DEFINITIVE NOTES.

             (i) BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES TO RESTRICTED
     DEFINITIVE NOTES. Subject to Section 2.06(a) hereof, if any holder of a
     beneficial interest in a Restricted Global Note proposes to exchange such
     beneficial interest for a Restricted Definitive Note or to transfer such
     beneficial interest to a Person who takes delivery thereof in the form of a
     Restricted Definitive Note, then, upon receipt by the Registrar of the
     following documentation:

                   (A) if the holder of such beneficial interest in a Restricted
         Global Note proposes to exchange such beneficial interest for a
         Restricted Definitive Note, a certificate from such holder in the form
         of Exhibit C hereto, including the certifications in item (2)(a)
         thereof;

                   (B) if such beneficial interest is being transferred to a QIB
         in accordance with Rule 144A, a certificate to the effect set forth in
         Exhibit B hereto, including the certifications in item (1) thereof;

                   (C) if such beneficial interest is being transferred to a
         "non-U.S. Person" (as defined in Rule 902(k) of Regulation S) in an
         offshore transaction in accordance with Rule 903 or Rule 904, a
         certificate to the effect set forth in Exhibit B hereto, including the
         certifications in item (2) thereof;

                   (D) if such beneficial interest is being transferred pursuant
         to an exemption from the registration requirements of the Securities
         Act in accordance with Rule 144 under the Securities Act, a certificate
         to the effect set forth in Exhibit B hereto, including the
         certifications in item (3)(a) thereof;


                                       27


                   (E) if such beneficial interest is being transferred to an
         Institutional Accredited Investor in reliance on an exemption from the
         registration requirements of the Securities Act other than those listed
         in clauses (B) through (D) above, a certificate to the effect set forth
         in Exhibit B hereto, including the certifications, certificates and
         Opinion of Counsel required by item (3)(d) thereof, as applicable; or

                   (F) if such beneficial interest is being transferred to the
         Company or any of its Subsidiaries, a certificate to the effect set
         forth in Exhibit B hereto, including the certifications in item (3)(b)
         thereof,

     the Trustee shall reduce or cause to be reduced in a corresponding amount
     pursuant to Section 2.06(h) hereof the aggregate principal amount of the
     applicable Restricted Global Note, and the Company shall execute and, upon
     receipt of an Authentication Order in accordance with Section 2.02 hereof,
     the Trustee shall authenticate and deliver a Restricted Definitive Note in
     the appropriate principal amount to the Person designated by the holder of
     such beneficial interest in instructions delivered to the Registrar by the
     Depositary and the applicable Participant or Indirect Participant on behalf
     of such holder. Any Restricted Definitive Note issued in exchange for a
     beneficial interest in a Restricted Global Note pursuant to this Section
     2.06(c)(i) shall be registered in such name or names and in such authorized
     denomination or denominations as the holder of such beneficial interest
     shall designate in such instructions. The Trustee shall deliver such
     Restricted Definitive Notes to the Persons in whose names such Notes are so
     registered. Any Restricted Definitive Note issued in exchange for a
     beneficial interest in a Restricted Global Note pursuant to this Section
     2.06(c)(i) shall bear the Private Placement Legend and shall be subject to
     all restrictions on transfer contained therein.

             (ii) BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES TO
     UNRESTRICTED DEFINITIVE NOTES. Subject to Section 2.06(a) hereof, a holder
     of a beneficial interest in a Restricted Global Note may exchange such
     beneficial interest for an Unrestricted Definitive Note or may transfer
     such beneficial interest to a Person who takes delivery thereof in the form
     of an Unrestricted Definitive Note only if:

                   (A) such exchange or transfer is effected pursuant to an
         Exchange Offer in accordance with a Registration Rights Agreement and
         the holder of such beneficial interest, in the case of an exchange, or
         the transferee, in the case of a transfer, makes any and all
         certifications in the applicable Letter of Transmittal (or is deemed to
         have made such certifications if delivery is made through the
         Applicable Procedures) as may be required by such Registration Rights
         Agreement;

                   (B) such transfer is effected pursuant to a Shelf
         Registration Statement in accordance with a Registration Rights
         Agreement;

                   (C) such transfer is effected by a broker-dealer pursuant to
         an Exchange Offer Registration Statement in accordance with a
         Registration Rights Agreement; or

                   (D) the Registrar receives the following:

                   (1) if the holder of such beneficial interest in a Restricted
         Global Note proposes to exchange such beneficial interest for an
         Unrestricted Definitive Note, a certificate from such holder in the
         form of Exhibit C hereto, including the certifications in item (1)(b)
         thereof; or

                   (2) if the holder of such beneficial interest in a Restricted
         Global Note proposes to transfer such beneficial interest to a Person
         who shall take delivery thereof in the form


                                       28


         of an Unrestricted Definitive Note, a certificate from such holder in
         the form of Exhibit B hereto, including the certifications in item (4)
         thereof;

         and, in each such case set forth in this clause (D), if the Registrar
         so requests or if the Applicable Procedures so require, an Opinion of
         Counsel in form reasonably acceptable to the Registrar to the effect
         that such exchange or transfer shall be effected in compliance with the
         Securities Act and that the restrictions on transfer contained herein
         and in the Private Placement Legend shall no longer be required in
         order to maintain compliance with the Securities Act.

         Upon satisfaction of the conditions of any of the clauses of this
     Section 2.06(c)(ii) the Company shall execute, and, upon receipt of an
     Authentication Order in accordance with Section 2.02 hereof, the Trustee
     shall authenticate and deliver an Unrestricted Definitive Note in the
     appropriate principal amount to the Person designated by the holder of such
     beneficial interest in instructions delivered to the Registrar by the
     Depositary and the applicable Participant or Indirect Participant on behalf
     of such holder, and the Trustee shall reduce or cause to be reduced in a
     corresponding amount pursuant to Section 2.06(h) hereof the aggregate
     principal amount of the applicable Restricted Global Note.

             (iii) BENEFICIAL INTERESTS IN UNRESTRICTED GLOBAL NOTES TO
     UNRESTRICTED DEFINITIVE NOTES. Subject to Section 2.06(a) hereof, if any
     holder of a beneficial interest in an Unrestricted Global Note proposes to
     exchange such beneficial interest for an Unrestricted Definitive Note or to
     transfer such beneficial interest to a Person who takes delivery thereof in
     the form of an Unrestricted Definitive Note, then, upon satisfaction of the
     applicable conditions set forth in Section 2.06(b)(ii) hereof, the Trustee
     shall reduce or cause to be reduced in a corresponding amount pursuant to
     Section 2.06(h) hereof the aggregate principal amount of the applicable
     Unrestricted Global Note, and the Company shall execute and, upon receipt
     of an Authentication Order in accordance with Section 2.02 hereof, the
     Trustee shall authenticate and deliver an Unrestricted Definitive Note in
     the appropriate principal amount to the Person designated by the holder of
     such beneficial interest in instructions delivered to the Registrar by the
     Depositary and the applicable Participant or Indirect Participant on behalf
     of such holder. Any Unrestricted Definitive Note issued in exchange for a
     beneficial interest pursuant to this Section 2.06(c)(iii) shall be
     registered in such name or names and in such authorized denomination or
     denominations as the holder of such beneficial interest shall designate in
     such instructions. The Trustee shall deliver such Unrestricted Definitive
     Notes to the Persons in whose names such Notes are so registered. Any
     Unrestricted Definitive Note issued in exchange for a beneficial interest
     pursuant to this Section 2.06(c)(iii) shall not bear the Private Placement
     Legend.

         (d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR BENEFICIAL INTERESTS.

             (i) RESTRICTED DEFINITIVE NOTES TO BENEFICIAL INTERESTS IN
     RESTRICTED GLOBAL NOTES. If any holder of a Restricted Definitive Note
     proposes to exchange such Note for a beneficial interest in a Restricted
     Global Note or to transfer such Restricted Definitive Notes to a Person who
     takes delivery thereof in the form of a beneficial interest in a Restricted
     Global Note, then, upon receipt by the Registrar of the following
     documentation:

                   (A) if the holder of such Restricted Definitive Note proposes
         to exchange such Note for a beneficial interest in a Restricted Global
         Note, a certificate from such holder in the form of Exhibit C hereto,
         including the certifications in item (2)(b) thereof;

                   (B) if such Restricted Definitive Note is being transferred
         to a QIB in accordance with Rule 144A, a certificate to the effect set
         forth in Exhibit B hereto, including the certifications in item (1)
         thereof;

                   (C) if such Restricted Definitive Note is being transferred
         to a "non-U.S. Person" (as defined in Rule 902(k) of Regulation S) in
         an offshore transaction in accordance with Rule 903 or Rule 904, a
         certificate to the effect set forth in Exhibit B hereto, including the
         certifications in item (2) thereof;


                                       29


                   (D) if such Restricted Definitive Note is being transferred
         pursuant to an exemption from the registration requirements of the
         Securities Act in accordance with Rule 144, a certificate to the effect
         set forth in Exhibit B hereto, including the certifications in item
         (3)(a) thereof;

                   (E) if such Restricted Definitive Note is being transferred
         to an Institutional Accredited Investor in reliance on an exemption
         from the registration requirements of the Securities Act other than
         those listed in clauses (B) through (D) above, a certificate to the
         effect set forth in Exhibit B hereto, including the certifications,
         certificates and Opinion of Counsel required by item (3)(d) thereof, if
         applicable; or

                   (F) if such Restricted Definitive Note is being transferred
         to the Company or any of its Subsidiaries, a certificate to the effect
         set forth in Exhibit B hereto, including the certifications in item
         (3)(b) thereof,

     the Trustee shall cancel the Restricted Definitive Note, increase or cause
     to be increased in a corresponding amount pursuant to Section 2.06(h)
     hereof the aggregate principal amount of, in the case of clause (A) above,
     the appropriate Restricted Global Note, in the case of clause (B) above, a
     144A Global Note, in the case of clause (C) above, a Regulation S Global
     Note, and in all other cases, an IAI Global Note.

             (ii) RESTRICTED DEFINITIVE NOTES TO BENEFICIAL INTERESTS IN
     UNRESTRICTED GLOBAL NOTES. A holder of a Restricted Definitive Note may
     exchange such Note for a beneficial interest in an Unrestricted Global Note
     or transfer such Restricted Definitive Note to a Person who takes delivery
     thereof in the form of a beneficial interest in an Unrestricted Global Note
     only if:

                   (A) such exchange or transfer is effected pursuant to a
         Exchange Offer in accordance with a Registration Rights Agreement and
         the holder of such beneficial interest, in the case of an exchange, or
         the transferee, in the case of a transfer, makes such certifications in
         the applicable Letter of Transmittal (or is deemed to have made such
         certifications if delivery is made through the Applicable Procedures)
         as may be required by such Registration Rights Agreement;

                   (B) such transfer is effected pursuant to a Shelf
         Registration Statement in accordance with a Registration Rights
         Agreement;

                   (C) such transfer is effected by a broker-dealer pursuant to
         an Exchange Offer Registration Statement in accordance with a
         Registration Rights Agreement; or

                   (D) the Registrar receives the following:

                   (1) if the holder of such Restricted Definitive Note proposes
         to exchange such Note for a beneficial interest in an Unrestricted
         Global Note, a certificate from such holder in the form of Exhibit C
         hereto, including the certifications in item (1)(c) thereof; or

                   (2) if the holder of such Restricted Definitive Note proposes
         to transfer such Note to a Person who shall take delivery thereof in
         the form of a beneficial interest in an Unrestricted Global Note, a
         certificate from such holder in the form of Exhibit B hereto, including
         the certifications in item (4) thereof;

         and, in each such case set forth in this clause (D), if the Registrar
         so requests or if the Applicable Procedures so require, an Opinion of
         Counsel in form reasonably acceptable to the Registrar to the


                                       30


         effect that such exchange or transfer shall be effected in compliance
         with the Securities Act and that the restrictions on transfer contained
         herein and in the Private Placement Legend shall no longer be required
         in order to maintain compliance with the Securities Act.

         Upon satisfaction of the conditions of any of the clauses in this
Section 2.06(d)(ii), the Trustee shall cancel such Restricted Definitive Note
and increase or cause to be increased in a corresponding amount pursuant to
Section 2.06(h) hereof the aggregate principal amount of the Unrestricted Global
Note.

             (iii) UNRESTRICTED DEFINITIVE NOTES TO BENEFICIAL INTERESTS IN
     UNRESTRICTED GLOBAL NOTES. A holder of an Unrestricted Definitive Note may
     exchange such Note for a beneficial interest in an Unrestricted Global Note
     or transfer such Unrestricted Definitive Note to a Person who takes
     delivery thereof in the form of a beneficial interest in an Unrestricted
     Global Note at any time. Upon receipt of a request for such an exchange or
     transfer, the Trustee shall cancel the applicable Unrestricted Definitive
     Note and increase or cause to be increased in a corresponding amount
     pursuant to Section 2.06(h) hereof the aggregate principal amount of one of
     the Unrestricted Global Notes.

             (iv) TRANSFER OR EXCHANGE OF UNRESTRICTED DEFINITIVE NOTES TO
     BENEFICIAL INTERESTS IN RESTRICTED GLOBAL NOTES PROHIBITED. An Unrestricted
     Definitive Note may not be exchanged for, or transferred to Persons who
     take delivery thereof in the form of, beneficial interests in a Restricted
     Global Note.

             (v) ISSUANCE OF UNRESTRICTED GLOBAL NOTES. If any such exchange or
     transfer of a Definitive Note for a beneficial interest in an Unrestricted
     Global Note is effected pursuant to clause (ii)(B), (ii)(D) or (iii) above
     at a time when an Unrestricted Global Note has not yet been issued, the
     Company shall issue and, upon receipt of an Authentication Order in
     accordance with Section 2.02 hereof, the Trustee shall authenticate one or
     more Unrestricted Global Notes in an aggregate principal amount equal to
     the principal amount of Definitive Notes so transferred.

         (e) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR DEFINITIVE NOTES.
Upon request by a holder of Definitive Notes and such holder's compliance with
the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such holder. In
addition, the requesting holder shall provide any additional certifications,
documents and information, as applicable, required pursuant to the following
provisions of this Section 2.06(e).

             (i) RESTRICTED DEFINITIVE NOTES TO RESTRICTED DEFINITIVE NOTES. Any
     Restricted Definitive Note may be transferred to and registered in the name
     of Persons who take delivery thereof in the form of a Restricted Definitive
     Note if the Registrar receives the following:

                   (A) if the transfer will be made pursuant to Rule 144A, a
         certificate in the form of Exhibit B hereto, including the
         certifications in item (1) thereof;

                   (B) if the transfer will be made pursuant to Rule 903 or Rule
         904, a certificate in the form of Exhibit B hereto, including the
         certifications in item (2) thereof; and

                   (C) if the transfer will be made pursuant to any other
         exemption from the registration requirements of the Securities Act, a
         certificate in the form of Exhibit B hereto, including the
         certifications, certificates and Opinion of Counsel required by item
         (3) thereof, if applicable.

             (ii) RESTRICTED DEFINITIVE NOTES TO UNRESTRICTED DEFINITIVE NOTES.
     Any Restricted Definitive Note may be exchanged by the holder thereof for
     an Unrestricted Definitive Note or transferred to a Person or Persons who
     take delivery thereof in the form of an Unrestricted Definitive Note only
     if:


                                       31


                   (A) such exchange or transfer is effected pursuant to an
         Exchange Offer in accordance with a Registration Rights Agreement and
         the holder of such beneficial interest, in the case of an exchange, or
         the transferee, in the case of a transfer, makes such certifications in
         the applicable Letter of Transmittal (or is deemed to have made such
         certifications if delivery is made through the Applicable Procedures)
         as may be required by such Registration Rights Agreement;

                   (B) any such transfer is effected pursuant to a Shelf
         Registration Statement in accordance with a Registration Rights
         Agreement;

                   (C) any such transfer is effected by a broker-dealer pursuant
         to an Exchange Offer Registration Statement in accordance with a
         Registration Rights Agreement; or

                   (D) the Registrar receives the following:

                   (1) if the holder of such Restricted Definitive Notes
         proposes to exchange such Notes for an Unrestricted Definitive Note, a
         certificate from such holder in the form of Exhibit C hereto, including
         the certifications in item (1)(d) thereof; or

                   (2) if the holder of such Restricted Definitive Notes
         proposes to transfer such Notes to a Person who shall take delivery
         thereof in the form of an Unrestricted Definitive Note, a certificate
         from such holder in the form of Exhibit B hereto, including the
         certifications in item (4) thereof;

         and, in each such case set forth in this clause (D), if the Registrar
         so requests, an Opinion of Counsel in form reasonably acceptable to the
         Registrar to the effect that such exchange or transfer shall be
         effected in compliance with the Securities Act and that the
         restrictions on transfer contained herein and in the Private Placement
         Legend shall no longer be required in order to maintain compliance with
         the Securities Act.

         Upon satisfaction of the conditions of any of the clauses of Section
         2.06(e)(ii) the Trustee shall cancel the prior Restricted Definitive
         Note and the Company shall execute, and, upon receipt of an
         Authentication Order in accordance with Section 2.02 hereof, the
         Trustee shall authenticate and deliver an Unrestricted Definitive Note
         in the appropriate principal amount to the Person designated by the
         holder of such prior Restricted Definitive Note in instructions
         delivered to the Registrar by such holder.

             (iii) UNRESTRICTED DEFINITIVE NOTES TO UNRESTRICTED DEFINITIVE
     NOTES. A holder of Unrestricted Definitive Notes may transfer such Notes to
     a Person who takes delivery thereof in the form of an Unrestricted
     Definitive Note. Upon receipt of a request to register such a transfer, the
     Registrar shall register the Unrestricted Definitive Notes pursuant to the
     instructions from the Holders thereof.

         (f) EXCHANGE OFFER. Upon the occurrence of an Exchange Offer in
accordance with a Registration Rights Agreement, the Company shall issue and,
upon receipt of an Authentication Order in accordance with Section 2.02 hereof,
the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the applicable Restricted Global Notes (A) tendered for acceptance
by Persons that make any and all certifications in the applicable Letters of
Transmittal (or are deemed to have made such certifications if delivery is made
through the Applicable Procedures) as may be required by such Registration
Rights Agreement, and (B) accepted for exchange in the Exchange Offer and (ii)
Unrestricted Definitive Notes in an aggregate principal amount equal to the
principal amount of the Restricted Definitive Notes tendered for acceptance by
Persons who made the foregoing certification and accepted for exchange in the
Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall
reduce or cause to be reduced in a corresponding amount the aggregate principal
amount of the applicable Restricted Global Notes, and


                                       32


the Company shall execute and the Trustee shall authenticate and deliver to the
Persons designated by the holders of Restricted Definitive Notes so accepted
Unrestricted Definitive Notes in the appropriate principal amount.

         (g) LEGENDS. The following legends shall appear on the face of all
Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.

            (i) PRIVATE PLACEMENT LEGEND.

                   (A) Except as permitted by clause (B) below, each Global Note
         and each Definitive Note (and all Notes issued in exchange therefor or
         substitution thereof) shall bear the legend in substantially the
         following form:

         "THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.

         THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER,
SELL, ASSIGN, TRANSFER, PLEDGE, ENCUMBER OR OTHERWISE DISPOSE OF SUCH SECURITY,
PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS
AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH SUN
MEDIA CORPORATION (THE "COMPANY") OR ANY OF ITS AFFILIATES WAS THE OWNER OF THIS
SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE COMPANY OR ANY
OF ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO
NON-U.S. PERSONS THAT OCCUR OUTSIDE OF THE UNITED STATES WITHIN THE MEANING OF
REGULATION S UNDER THE SECURITIES ACT, (E) TO AN "ACCREDITED INVESTOR" WITHIN
THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS
AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN
A MINIMUM PRINCIPAL AMOUNT OF US$250,000, FOR INVESTMENT PURPOSES ONLY AND NOT
WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION OF THE
SECURITIES IN VIOLATION OF THE SECURITIES ACT OR (F) PURSUANT TO ANY OTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE,
ASSIGNMENT, TRANSFER, PLEDGE, ENCUMBRANCE OR OTHER DISPOSITION PURSUANT TO
CLAUSES (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM. THIS LEGEND
WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE."

                   (B) Notwithstanding the foregoing, any Global Note or
         Definitive Note issued pursuant to clauses (b)(iv), (c)(ii), (c)(iii),
         (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.06 (and
         all Notes issued in exchange therefor or substitution thereof) shall
         not bear the Private Placement Legend.

             (ii) GLOBAL NOTE LEGEND. Each Global Note shall bear a legend in
     substantially the following form:


                                       33


         "THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
THE COMPANY.

         UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE COMPANY OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."

         (h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL NOTES. At such time as all
beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or
cancelled in whole and not in part, each such Global Note shall be returned to
or retained and cancelled by the Trustee in accordance with Section 2.11 hereof.
At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depositary at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.

            (i) GENERAL PROVISIONS RELATING TO TRANSFERS AND EXCHANGES.

             (i) No service charge shall be made to a Holder of a beneficial
     interest in a Global Note or to a Holder of a Definitive Note for any
     registration of transfer or exchange, but the Company may require payment
     of a sum sufficient to cover any transfer tax or similar governmental
     charge payable in connection therewith (other than any such transfer taxes
     or similar governmental charge payable upon exchange or transfer pursuant
     to Sections 2.10, 3.06, 4.12, 4.18 and 9.05 hereof).

             (ii) All Global Notes and Definitive Notes issued upon any
     registration of transfer or exchange of Global Notes or Definitive Notes
     shall be the valid obligations of the Company, evidencing the same
     Indebtedness, as the Global Notes or Definitive Notes surrendered upon such
     registration of transfer or exchange and shall be entitled to all of the
     benefits of this Indenture equally and proportionately with all other Notes
     duly issued hereunder.

             (iii) Neither the Registrar nor the Company shall be required (A)
     to issue, to register the transfer of or to exchange any Notes during a
     period beginning at the opening of business 15 days before the day of any
     selection of Notes for redemption under Section 3.02 hereof and ending at
     the close of business on the date of selection, (B) to register the
     transfer of or to exchange any Note so selected for redemption in whole


                                       34



     or in part, except the unredeemed portion of any Note being redeemed in
     part or (C) to register the transfer of or to exchange a Note between a
     record date (including a Regular Record Date) and the next succeeding
     Interest Payment Date.

             (iv) Prior to due presentment for the registration of a transfer of
     any Note, the Trustee, any Agent and the Company may deem and treat the
     Person in whose name any Note is registered as the absolute owner of such
     Note for the purpose of receiving payment of principal of and interest on
     such Note and for all other purposes, in each case regardless of any notice
     to the contrary.

             (v) All certifications, certificates and Opinions of Counsel
     required to be submitted to the Registrar pursuant to this Section 2.06 to
     effect a registration of transfer or exchange may be submitted by
     facsimile.

             (vi) The Trustee is hereby authorized and directed to enter into a
     letter of representation with the Depositary in the form provided by the
     Company and to act in accordance with such letter.

SECTION 2.07.     REPLACEMENT NOTES.

         If any mutilated Note is surrendered to the Trustee or the Company and
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Note, the Company shall issue and the Trustee, upon receipt of an
Authentication Order in accordance with Section 2.02 hereof, shall authenticate
a replacement Note. If required by the Trustee or the Company, the Holder of
such Note shall provide indemnity sufficient, in the judgment of the Trustee or
the Company, as applicable, to protect the Company, the Trustee, any Agent and
any authenticating agent from any loss that any of them may suffer in connection
with such replacement. If required by the Company, such Holder shall reimburse
the Company for its reasonable expenses in connection with such replacement.

         Every replacement Note issued in accordance with this Section 2.07
shall be the valid obligation of the Company evidencing the same Indebtedness as
the destroyed, lost or stolen Note and shall be entitled to all of the benefits
of this Indenture equally and proportionately with all other Notes duly issued
hereunder.

SECTION 2.08.     OUTSTANDING NOTES.

         (a) The Notes outstanding at any time shall be the entire principal
amount of Notes represented by all the Global Notes and Definitive Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, those subject to reductions in beneficial interests
effected by the Trustee in accordance with Section 2.06 hereof, and those
described in this Section 2.08 as not outstanding. Except as set forth in
Section 2.09 hereof, a Note shall not cease to be outstanding because the
Company or an Affiliate of the Company holds the Note; PROVIDED, HOWEVER, that
Notes held by the Company or a Subsidiary of the Company shall be deemed not to
be outstanding for purposes of Section 3.07(c) hereof.

         (b) If a Note is replaced pursuant to Section 2.07 hereof, it shall
cease to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced Note is held by a bona fide purchaser.

         (c) If the principal amount of any Note is considered paid under
Section 4.01 hereof, it shall cease to be outstanding and interest on it shall
cease to accrue.

         (d) If the Paying Agent (other than the Company, a Subsidiary or an
Affiliate of any thereof) holds, on a redemption date, a Purchase Date or
maturity date, funds sufficient to pay Notes payable on that date, then on and
after that date such Notes shall be deemed to be no longer outstanding and shall
cease to accrue interest.

SECTION 2.09.     TREASURY NOTES.

         In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Company, or by any Affiliate of the Company, shall be


                                       35



considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded.

SECTION 2.10.     TEMPORARY NOTES.

         Until certificates representing Notes are ready for delivery, the
Company may prepare and the Trustee, upon receipt of an Authentication Order in
accordance with Section 2.02 hereof, shall authenticate temporary Notes.
Temporary Notes shall be substantially in the form of Definitive Notes but may
have variations that the Company considers appropriate for temporary Notes and
as shall be reasonably acceptable to the Trustee. Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate Global Notes or
Definitive Notes in exchange for temporary Notes, as applicable.

         Holders of temporary Notes shall be entitled to all of the benefits of
this Indenture equally and proportionately with all other Notes duly issued
hereunder.

SECTION 2.11.     CANCELLATION.

         The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment.
Upon sole direction of the Company, the Trustee shall cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall destroy cancelled Notes (subject to the record retention
requirements of the Exchange Act or other applicable laws). Certification of the
destruction of all cancelled Notes shall be delivered to the Company from time
to time upon request. The Company may not issue new Notes to replace Notes that
it has paid or that have been delivered to the Trustee for cancellation.

SECTION 2.12.     DEFAULTED INTEREST.

         If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Company shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Company shall fix or cause to be fixed each such
special record date and payment date, PROVIDED that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Company (or, upon
the written request of the Company, the Trustee in the name and at the expense
of the Company) shall mail or cause to be mailed to Holders a notice that states
the special record date, the related payment date and the amount of such
interest to be paid.

SECTION 2.13.     CUSIP OR ISIN NUMBERS.

         The Company in issuing the Notes may use "CUSIP" or "ISIN" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" or "ISIN"
numbers in notices of redemption as a convenience to Holders; PROVIDED, HOWEVER,
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption or notice of an Offer to Purchase and that reliance
may be placed only on the other identification numbers printed on the Notes, and
any such redemption or Offer to Purchase shall not be affected by any defect in
or omission of such numbers. The Company shall promptly notify the Trustee of
any change in the "CUSIP" or "ISIN" numbers.

SECTION 2.14.     SPECIAL INTEREST

         If Special Interest is payable by the Company pursuant to a
Registration Rights Agreement and paragraph 1 of the Notes, the Company shall
deliver to the Trustee a certificate to that effect stating (i) the amount of
such Special Interest that is payable and (ii) the date on which such interest
is payable pursuant to Section 4.01 hereof. Unless and until a Responsible
Officer of the Trustee receives such a certificate or instruction or direction


                                       36


from the Holders in accordance with the terms of this Indenture, the Trustee may
assume without inquiry that no Special Interest is payable. The foregoing shall
not prejudice the rights of the Holders with respect to their entitlement to
Special Interest as otherwise set forth in this Indenture or the Notes and
pursuing any action against the Company directly or otherwise directing the
Trustee to take any such action in accordance with the terms of this Indenture
and the Notes. If the Company has paid Special Interest directly to the Persons
entitled to it, the Company shall deliver to the Trustee an Officers'
Certificate setting forth the details of such payment.

SECTION 2.15.     ISSUANCE OF ADDITIONAL NOTES

         The Company shall be entitled, subject to its compliance with Section
4.09 hereof, to issue Additional Notes under this Indenture which shall have
identical terms as the Initial Notes issued on the date hereof, other than with
respect to the date of issuance, issue price and rights under a related
Registration Rights Agreement, if any. The Initial Notes issued on the date
hereof, any Additional Notes and all Exchange Notes issued in exchange therefor
shall be treated as a single class for all purposes under this Indenture,
including without limitation, directions, waivers, consents, redemptions and
Offers to Purchase.

         With respect to any Additional Notes, the Company shall set forth in a
Board Resolution and an Officers' Certificate, a copy of each of which shall be
delivered to the Trustee, the following information:

         (a) the aggregate principal amount of such Additional Notes to be
authenticated and delivered pursuant to this Indenture;

         (b) the issue price, the issue date and the CUSIP and/or ISIN number of
such Additional Notes; PROVIDED, HOWEVER, that no Additional Notes may be issued
at a price that would cause such Additional Notes to have "original issue
discount" within the meaning of Section 1273 of the Code; and

         (c) whether such Additional Notes shall be subject to the restrictions
on transfer set forth in Section 2.06 hereof relating to Restricted Global Notes
and Restricted Definitive Notes.

                                   ARTICLE 3.

                            REDEMPTION AND PREPAYMENT

SECTION 3.01.     NOTICES TO TRUSTEE.

         If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days but not more than 60 days before a redemption date (or such
shorter period as allowed by the Trustee), an Officers' Certificate setting
forth (i) the applicable section of this Indenture pursuant to which the
redemption shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.

SECTION 3.02.     SELECTION OF NOTES TO BE REDEEMED.

         If less than all of the Notes are to be redeemed at any time, the
Trustee shall select the Notes to be redeemed among the Holders of the Notes in
compliance with the requirements of the principal national securities exchange,
if any, on which the Notes are listed or, if the Notes are not so listed, on a
PRO RATA basis, by lot or in accordance with any other method the Trustee
considers fair and appropriate. In the event of partial redemption by lot, the
particular Notes to be redeemed shall be selected, unless otherwise provided
herein, not less than 30 nor more than 60 days prior to the redemption date by
the Trustee from the outstanding Notes not previously called for redemption.

         The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of US$1,000 or integral multiples of
US$1,000, except that if all of the Notes of a Holder are to be redeemed, the
entire outstanding amount of Notes held by such Holder, even if not


                                       37


an integral multiple of US$1,000, shall be redeemed. Except as provided in the
preceding sentence, provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption.

SECTION 3.03.     NOTICE OF REDEMPTION.

         At least 30 days but not more than 60 days prior to a redemption date,
the Company shall mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at such Holder's
address appearing in the securities register maintained in respect of the Notes
by the Registrar (the "SECURITY REGISTER").

         The notice shall identify the Notes to be redeemed and shall state:

         (a) the redemption date;

         (b) the redemption price or if the redemption is made pursuant to
Section 3.07(b) hereof a calculation of the redemption price;

         (c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;

         (d) the name and address of the Paying Agent;

         (e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;

         (f) that, unless the Company defaults in making such redemption
payment, interest on Notes called for redemption ceases to accrue on and after
the redemption date;

         (g) the applicable section of this Indenture pursuant to which the
Notes called for redemption are being redeemed; and

         (h) that no representation is made as to the correctness of the CUSIP
or ISIN numbers, if any, listed in such notice or printed on the Notes.

         At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; PROVIDED, HOWEVER, that the
Company shall have delivered to the Trustee, at least 45 days (or such shorter
period allowed by the Trustee) prior to the redemption date, an Officers'
Certificate requesting that the Trustee give such notice (in the name and at the
expense of the Company) and setting forth the information to be stated in such
notice as provided in this Section 3.03.

SECTION 3.04.     EFFECT OF NOTICE OF REDEMPTION.

         Once notice of redemption is mailed in accordance with Section 3.03
hereof, Notes called for redemption shall become irrevocably due and payable on
the redemption date at the redemption price. A notice of redemption may not be
conditional.

SECTION 3.05.     DEPOSIT OF REDEMPTION PRICE.

         On or prior to 11:00 a.m. Eastern time on the Business Day prior to any
redemption date, the Company shall deposit with the Trustee or with the Paying
Agent money sufficient to pay the redemption price of and accrued and unpaid
interest on all Notes to be redeemed on that date. The Trustee or the Paying
Agent shall promptly return to the Company any money deposited with the Trustee
or the Paying Agent by the Company in excess of the amounts necessary to pay the
redemption price of, and accrued and unpaid interest on, all Notes to be
redeemed.

                                       38


         If the Company complies with the provisions of the preceding paragraph,
on and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption in accordance with Section 2.08(d)
hereof. If a Note is redeemed on or after a Regular Record Date but on or prior
to the related Interest Payment Date, then any accrued and unpaid interest shall
be paid to the Person in whose name such Note was registered at the close of
business on such Regular Record Date. If any Note called for redemption shall
not be so paid upon surrender for redemption because of the failure of the
Company to comply with the preceding paragraph, interest shall be paid on the
unpaid principal from the redemption date until such principal is paid, and to
the extent lawful on any interest not paid on such unpaid principal, in each
case at the rate provided in the Notes and in Section 4.01 hereof.

SECTION 3.06.     NOTES REDEEMED IN PART.

         Upon surrender of a Note that is redeemed in part, the Company shall
issue and, upon the Company's written request, the Trustee shall authenticate
for the Holder at the expense of the Company a new Note equal in principal
amount to the unredeemed portion of the Note surrendered.

SECTION 3.07.     OPTIONAL REDEMPTION

         (a) Except as set forth in clauses (b) and (c) of this Section 3.07,
the Notes shall not be redeemable at the option of the Company prior to February
15, 2008. Beginning on February 15, 2008, the Company may redeem all or a part
of the Notes, at once or over time, in accordance with Section 3.03 hereof, at
the redemption prices (expressed as percentages of principal amount) set forth
below, plus accrued and unpaid interest thereon on the Notes redeemed, to the
applicable redemption date (subject to the right of Holders of record on the
relevant Regular Record Date to receive interest due on the relevant Interest
Payment Date), if redeemed during the twelve-month period commencing on February
15 of the years indicated below:



REDEMPTION YEAR                                                       PERCENTAGE
                                                                   

2008.................................................................   103.813%
2009.................................................................   102.542%
2010.................................................................   101.271%
2011 and thereafter..................................................   100.000%


         (b) At any time and from time to time prior to February 15, 2006, the
Company may on one or more occasions redeem up to 35% of the aggregate principal
amount of the Notes issued under this Indenture at a redemption price (expressed
as a percentage of principal amount) equal to 107.625% of the principal amount
thereof, plus accrued and unpaid interest thereon to the redemption date
(subject to the right of Holders of record on the relevant Regular Record Date
to receive interest due on the relevant Interest Payment Date) with the net cash
proceeds of one or more Equity Offerings; PROVIDED, HOWEVER, that (i) at least
65% of the aggregate principal amount of the Notes issued under this Indenture
(excluding Notes held by the Company and its Subsidiaries) remain outstanding
immediately following such redemption and (ii) any such redemption shall be made
within 90 days of the date of closing of any such Equity Offering.

         (c) If the Company becomes obligated to pay any Additional Amounts
because of a change in the laws or regulations of Canada or any Canadian Taxing
Authority, or a change in any official position regarding the application or
interpretation thereof, in either case that is publicly announced or becomes
effective on or after the Issue Date, the Company may, at any time, redeem all,
but not part, of the Notes at a price equal to 100% of the principal amount
thereof, plus accrued and unpaid interest to the redemption date, PROVIDED that
at any time that the aggregate principal amount of the Notes outstanding is
greater than US$20.0 million, any Holder of the Notes may, to the extent that it
does not adversely affect the Company's after-tax position, at its option, waive
the Company's compliance with the provisions of Section 4.20 hereof; PROVIDED,
FURTHER, that if any Holder waives such compliance, the Company may not redeem
that Holder's Notes pursuant to this Section 3.07(c).

         (d) Any prepayment pursuant to this Section 3.07 shall be made pursuant
to the provisions of Sections 3.01 through 3.06 hereof.

                                       39



SECTION 3.08.     MANDATORY REDEMPTION.

         Except as set forth in Sections 4.12 and 4.18 hereof, the Company shall
not be required to make mandatory redemption or sinking fund payments with
respect to, or offers to purchase, the Notes.

SECTION 3.09.     OFFERS TO PURCHASE.

         (a) In the event that, pursuant to Section 4.12 or 4.18 hereof, the
Company shall be required to commence an Asset Sale Offer or Change of Control
Offer (each, an "OFFER TO PURCHASE"), it shall follow the procedures specified
below.

         (b) The Company shall commence the Offer to Purchase by sending, by
first-class mail, with a copy to the Trustee, to each Holder, at such Holder's
address appearing in the Security Register a notice, the terms of which shall
govern the Offer to Purchase, stating:

             (i) that the Offer to Purchase is being made pursuant to this
     Section 3.09 and Section 4.12 or 4.18, as the case may be, and, in the case
     of a Change of Control Offer, that a Change of Control has occurred, the
     transaction or transactions that constitute the Change of Control, and that
     a Change of Control Offer is being made pursuant to Section 4.18 hereof;

             (ii) the principal amount of Notes required to be purchased
     pursuant to Section 4.12 or 4.18 hereof (the "OFFER AMOUNT"), the purchase
     price, the Offer Period and the Purchase Date (each as defined below);

             (iii) except as provided in clause (ix), that all Notes timely
     tendered and not withdrawn shall be accepted for payment;

             (iv) that any Note not tendered or accepted for payment shall
     continue to accrue interest;

             (v) that, unless the Company defaults in making such payment, any
     Note accepted for payment pursuant to the Offer to Purchase shall cease to
     accrue interest after the Purchase Date;

             (vi) that Holders electing to have a Note purchased pursuant to the
     Offer to Purchase may elect to have Notes purchased in integral multiples
     of US$1,000 only;

             (vii) that Holders electing to have a Note purchased pursuant to
     the Offer to Purchase shall be required to surrender the Note, with the
     form entitled "Option of Holder to Elect Purchase" on the reverse of the
     Note completed, or transfer by book-entry transfer, to the Company, a
     Depositary, if appointed by the Company, or a Paying Agent at the address
     specified in the notice at least three days before the Purchase Date;

             (viii) that Holders shall be entitled to withdraw their election if
     the Company, the Depositary or the Paying Agent, as the case may be,
     receives, not later than the expiration of the Offer Period, a telegram,
     facsimile transmission or letter setting forth the name of the Holder, the
     principal amount of the Note (or portions thereof) the Holder delivered for
     purchase and a statement that such Holder is withdrawing his election to
     have such Note purchased;

             (ix) that, in the case of an Asset Sale Offer, if the aggregate
     principal amount of Notes surrendered by Holders exceeds the Offer Amount,
     the Company shall select the Notes to be purchased on a PRO RATA basis
     (with such adjustments as may be deemed appropriate by the Company so that
     only Notes in denominations of US$1,000 or integral multiples thereof shall
     be purchased);

             (x) that Holders whose Notes were purchased in part shall be issued
     new Notes equal in principal amount to the unpurchased portion of the Notes
     surrendered (or transferred by book-entry transfer)

                                       40


             (xi) any other procedures that Holders must follow in order to
     tender their Notes (or portions thereof) for payment.

         (c) The Offer to Purchase shall remain open for a period of at least 30
days but no more than 60 days following its commencement, except to the extent
that a longer period is required by applicable law (the "OFFER PERIOD"). No
later than five Business Days after the termination of the Offer Period (the
"PURCHASE DATE"), the Company shall purchase the Offer Amount or, if less than
the Offer Amount has been tendered, all Notes tendered in response to the Offer
to Purchase. Payment for any Notes so purchased shall be made in the same manner
as interest payments are made.

         (d) On or prior to the Purchase Date, the Company shall, to the extent
lawful:

             (i) accept for payment (on a PRO RATA basis to the extent necessary
     in connection with an Asset Sale Offer) the Offer Amount of Notes or
     portions of Notes properly tendered pursuant to the Offer to Purchase, or
     if less than the Offer Amount has been tendered, all Notes tendered;

             (ii) deposit with the Paying Agent an amount equal to the Offer
     Amount in respect of all Notes or portions of Notes properly tendered; and

             (iii) deliver or cause to be delivered to the Trustee the Notes so
     accepted together with an Officers' Certificate stating the aggregate
     principal amount of Notes or portions of Notes being purchased by the
     Company and that such Notes or portions thereof were accepted for payment
     by the Company in accordance with the terms of this Section 3.09.

         (e) The Company, the Depositary or the Paying Agent, as the case may
be, shall promptly (but in any event not later than five Business Days after the
Purchase Date) deliver to each tendering Holder of Notes properly tendered and
accepted by the Company for purchase the Purchase Amount for such Notes, and the
Company shall promptly execute and issue a new Note, and the Trustee, upon
receipt of an Authentication Order shall authenticate and deliver (or cause to
be transferred by book-entry) such new Note to such Holder, in a principal
amount equal to any unpurchased portion of the Note surrendered PROVIDED,
HOWEVER, that each such new Note shall be in a principal amount of US$1,000 or
an integral multiple of US$1,000. Any Note not so accepted shall be promptly
mailed or delivered by the Company to the Holder thereof. The Company shall
publicly announce the results of the Offer to Purchase on the Purchase Date.

         (f) If the Purchase Date is on or after a Regular Record Date and on or
before the related Interest Payment Date, any accrued and unpaid interest shall
be paid to the Person in whose name a Note is registered at the close of
business on such Regular Record Date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Offer to Purchase.

         (g) The Company shall comply with the requirements of Rule 14e-1 under
the Exchange Act and any other securities laws and regulations thereunder to the
extent those laws and regulations are applicable in connection with the Offer to
Purchase. To the extent that the provisions of any securities laws or
regulations conflict with Section 4.12 or 4.18, as applicable, this Section 3.09
or other provisions of this Indenture, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under Section 4.12 or 4.18, as applicable, this Section
3.09 or such other provision by virtue of such conflict.

         (h) Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made in accordance with the
provisions of Section 3.01 through 3.06 hereof.

                                       41


                                   ARTICLE 4.

                                   COVENANTS

SECTION 4.01.     PAYMENT OF NOTES.

         The Company shall pay or cause to be paid the principal of, premium, if
any, and interest on, the Notes on the dates and in the manner provided in the
Notes. Principal, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary thereof,
holds as of 11:00 a.m. Eastern Time on the due date money deposited by the
Company in immediately available funds and designated for and sufficient to pay
all principal, premium, if any, and interest then due. The Company shall pay
Special Interest, if any, in the same manner, on the dates and in the amounts
set forth in a Registration Rights Agreement, the Notes and this Indenture. If a
payment date is a Legal Holiday at a place of payment, payment may be made at
that place on the next succeeding day that is not a Legal Holiday, and no
interest shall accrue on such payment for the intervening period.

         The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the rate
then in effect; it shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue installments of interest
(without regard to any applicable grace periods), from time to time on demand at
the same rate to the extent lawful.

         Interest shall be computed on the basis of a 360-day year of twelve
30-day months. For the purposes of the INTEREST ACT (Canada), the yearly rate of
interest which is equivalent to the rate payable hereunder is the rate payable
multiplied by the actual number of days in the year and divided by 360.

SECTION 4.02.     MAINTENANCE OF OFFICE OR AGENCY.

         (a) The Company shall maintain in the Borough of Manhattan, The City of
New York, an office or agency (which may be an office or drop facility of the
Trustee or an affiliate of the Trustee, Registrar or co-registrar) where Notes
may be presented or surrendered for registration of transfer or for exchange and
where notices and demands to or upon the Company in respect of the Notes and
this Indenture may be served. The Company hereby initially designates the
Transfer Agent Drop Services, the Depository Trust Company, 55 Water Street, New
York, New York 10041, which is a drop facility of the Trustee or an affiliate of
the Trustee, as such an office or agency. The Company shall give prompt written
notice to the Trustee of any change in the location of such office or agency. If
at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.

         (b) The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations. The
Company shall give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.

         (c) The Company hereby designates the Corporate Trust Office of the
Trustee, as one such office, drop facility or agency of the Company in
accordance with Section 2.03 hereof.

SECTION 4.03.     REPORTS.

         (a) Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, so long as
any Notes are outstanding the Company shall file with the Commission, and shall
furnish to the Holders and the Trustee:

                                       42


                   (1) within 90 days after the end of each fiscal year of the
         Company, annual reports on Form 20-F or 40-F, as applicable, or any
         successor form; and

                   (2) (a) within 45 days after the end of each of the first
         three fiscal quarters of each fiscal year of the Company, reports on
         Form 10-Q or any successor form, or (b) within 60 days after the end of
         each of the first three fiscal quarters of each fiscal year of the
         Company, reports on Form 6-K, or any successor form, which, regardless
         of applicable requirements, shall, at a minimum, contain a
         "Management's Discussion and Analysis of Financial Condition and
         Results of Operations," and, with respect to any such reports, a
         reconciliation to U.S. GAAP as permitted by the Commission for foreign
         private issuers.

         (b) For so long as any Notes remain outstanding, the Company shall
furnish to the Holders, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.

         (c) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by this Section shall include a reasonably detailed presentation,
either on the face of the financial statements or in the footnotes thereto, and
in Management's Discussion and Analysis of Financial Condition and Results of
Operations, of the financial condition and results of operations of the Company
and the Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries of the Company.

SECTION 4.04.     COMPLIANCE CERTIFICATE.

         (a) The Company shall deliver to the Trustee, within 90 days after the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether the Company and its Subsidiaries have kept, observed,
performed and fulfilled their obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company and its Subsidiaries have kept, observed,
performed and fulfilled each and every covenant contained in this Indenture and
is not in default in the performance or observance of any of the terms,
provisions and conditions of this Indenture (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which he or she may have knowledge and what action the Company is taking or
proposes to take with respect thereto) and that to the best of his or her
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of, premium, if any, or interest on the
Notes is prohibited or if such event has occurred, a description of the event
and what action the Company is taking or proposes to take with respect thereto.

         (b) The Company shall otherwise comply with TIA Section 314(a)(2).

         (c) The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Default or Event of Default, its status and what action the Company is
taking or proposes to take with respect thereto.

SECTION 4.05.     TAXES.

         The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies,
except such as are being contested in good faith and by appropriate proceedings
or where the failure to effect such payment is not adverse in any material
respect to the Holders.

SECTION 4.06.     STAY, EXTENSION AND USURY LAWS.

         The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this

                                       43



Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law has been enacted.

SECTION 4.07.     CORPORATE EXISTENCE.

         Subject to Article 5 hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
Restricted Subsidiary, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Company or any
such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses
and franchises of the Company and the Restricted Subsidiaries; PROVIDED,
HOWEVER, that the Company shall not be required to preserve any such right,
license or franchise, or the corporate, partnership or other existence of any
Restricted Subsidiary, if the Board of Directors of the Company shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Company and the Restricted Subsidiaries, taken as a whole, and
that the loss thereof is not adverse in any material respect to the Holders of
the Notes, or that such preservation is not necessary in connection with any
transaction not prohibited by this Indenture.

SECTION 4.08.     PAYMENTS FOR CONSENT.

         The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, pay or cause to be paid any consideration, to or for
the benefit of any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid and is paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.

SECTION 4.09.     INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED SHARES.

         (a) The Company shall not, and shall not permit any of its Subsidiaries
to, Incur, directly or indirectly, any Indebtedness, including Acquired Debt,
and the Company shall not issue any Disqualified Stock and shall not permit any
of its Subsidiaries to issue any Preferred Shares; PROVIDED, HOWEVER, that the
Company may Incur Indebtedness, including Acquired Debt, or issue Disqualified
Stock, and the Subsidiary Guarantors may Incur Indebtedness, including Acquired
Debt, or issue Preferred Shares if the Company's Debt to Cash Flow Ratio at the
time of Incurrence of such Indebtedness or the issuance of such Disqualified
Stock or Preferred Shares, after giving PRO FORMA effect to such Incurrence or
issuance as of such date and to the use of proceeds therefrom, taking into
account any substantially concurrent transactions related to such Incurrence, as
if the same had occurred at the beginning of the most recently ended four fiscal
quarter period of the Company for which internal financial statements are
available, would have been no greater than 5.0 to 1.0.

         (b) Paragraph (a) of this Section 4.09 shall not prohibit the
Incurrence of any of the following items of Indebtedness or issuances of
Preferred Shares (each such item being referred to herein as "PERMITTED DEBT"):

         (1)   the Incurrence by the Company or a Subsidiary Guarantor of
               Indebtedness and letters of credit under Credit Facilities in an
               aggregate principal amount at any one time outstanding under this
               clause (1) (with letters of credit being deemed to have a
               principal amount equal to the maximum potential liability of the
               Company and the Subsidiary Guarantors thereunder) not to exceed
               an aggregate of (a) US$230.0 million and (b) Cdn$75.0 million,
               LESS the aggregate amount of all Net Proceeds of Asset Sales
               applied by the Company or any Subsidiary Guarantors subsequent to
               the Issue Date to permanently repay Indebtedness under a Credit
               Facility pursuant to the provisions of Section 4.12 hereof;

         (2)   the Incurrence by the Company and the Restricted Subsidiaries of
               the Existing Indebtedness;

                                       44


         (3)   the Incurrence by (a) the Company of Indebtedness represented by
               the Initial Notes and the Exchange Notes to be issued in exchange
               for such Initial Notes and in exchange for any Additional Notes,
               and (b) the Subsidiary Guarantors of Indebtedness represented by
               the Subsidiary Guarantees relating to the Initial Notes and the
               guarantees issued in exchange for such Subsidiary Guarantees and
               in exchange for the Subsidiary Guarantees relating to any
               Additional Notes;

         (4)   the Incurrence by the Company or a Subsidiary Guarantor of
               Indebtedness represented by Capital Lease Obligations, mortgage
               financings or purchase money obligations, in each case, Incurred
               for the purpose of financing all or any part of the purchase
               price or cost of construction or improvement of property, plant
               or equipment used in the business of the Company or such
               Subsidiary Guarantor, in an aggregate principal amount, including
               all Permitted Refinancing Indebtedness incurred to refund,
               refinance or replace any Indebtedness Incurred pursuant to this
               clause (4), not to exceed US$25.0 million at any time
               outstanding;

         (5)   the Incurrence by the Company or any Subsidiary Guarantor of
               Permitted Refinancing Indebtedness in exchange for, or the net
               proceeds of which are used to refund, refinance or replace
               Indebtedness, other than intercompany Indebtedness, that was
               permitted by this Indenture to be incurred under paragraph (a) or
               clauses (b)(2), (b)(3) and (b)(4) of this Section 4.09;

         (6)   the Incurrence by the Company or any Subsidiary Guarantor of
               intercompany Indebtedness between or among the Company and any
               Restricted Subsidiary; PROVIDED, HOWEVER, that:

               (i)      if the Company is the obligor on such Indebtedness, such
                        Indebtedness must be expressly subordinated to the prior
                        payment in full in cash of all Obligations with respect
                        to the Notes, and

               (ii)     (a) any subsequent issuance or transfer of Equity
                        Interests that results in any such Indebtedness being
                        held by a Person other than the Company or a Restricted
                        Subsidiary and (b) any sale or other transfer of any
                        such Indebtedness to a Person that is not either the
                        Company or a Restricted Subsidiary shall be deemed, in
                        each case, to constitute an Incurrence of such
                        Indebtedness by the Company or such Restricted
                        Subsidiary, as the case may be, that was not permitted
                        by this clause (6);

         (7)   the issuance by the Company or any Restricted Subsidiary of
               Preferred Shares solely to or among the Company and any
               Restricted Subsidiaries; PROVIDED, HOWEVER, that (a) any
               subsequent issuance or transfer of Equity Interests that results
               in any such Preferred Shares being held by a Person other than
               the Company or a Restricted Subsidiary and (b) any sale or other
               transfer of any such Preferred Shares to a Person that is not
               either the Company or a Restricted Subsidiary shall be deemed, in
               each case, to constitute an issuance of such Preferred Shares by
               the Company or a Restricted Subsidiary, as the case may be, that
               was not permitted by this clause (7);

         (8)   the Incurrence by the Company or any Subsidiary Guarantor of
               Hedging Obligations that are Incurred in the ordinary course of
               business of the Company or such Subsidiary Guarantor and not for
               speculative purposes; PROVIDED, HOWEVER, that, in the case of:

               (i)      any Interest Rate Agreement, the notional principal
                        amount of such Hedging Obligation does not exceed the
                        principal amount of the Indebtedness to which such
                        Hedging Obligation relates; and

                                       45


               (ii)     any Currency Exchange Protection Agreement, such Hedging
                        Obligation does not increase the principal amount of
                        Indebtedness of the Company and Subsidiary Guarantor
                        outstanding other than as a result of fluctuations in
                        foreign currency exchange rates or by reason of fees,
                        indemnities and compensation payable thereunder;

         (9)   the guarantee by the Company or a Subsidiary Guarantor of
               Indebtedness of the Company or a Subsidiary Guarantor that was
               permitted to be Incurred by another provision of this Section
               4.09;

         (10)  the Incurrence by the Company or any Restricted Subsidiary of
               Indebtedness in an aggregate principal amount, or accreted value,
               as applicable, at any time outstanding, including all Permitted
               Refinancing Indebtedness Incurred to refund, refinance or replace
               any Indebtedness Incurred pursuant to this clause (10), not to
               exceed US$25.0 million;

         (11)  the issuance of Preferred Shares by the Company's Unrestricted
               Subsidiaries or the Incurrence by the Company's Unrestricted
               Subsidiaries of Non-Recourse Debt; PROVIDED, HOWEVER, that if any
               such Indebtedness ceases to be Non-Recourse Debt of an
               Unrestricted Subsidiary, that event shall be deemed to constitute
               an Incurrence of Indebtedness by a Restricted Subsidiary that was
               not permitted by this clause (11);

         (12)  Indebtedness of the Company or any Subsidiary Guarantor in
               respect of bank overdrafts (and letters of credit in respect
               thereof) in the ordinary course of business not to exceed an
               aggregate amount of US$10.0 million; and

         (13)  the issuance of Indebtedness or Preferred Shares in connection
               with a Tax Benefit Transaction.

         (c) The accrual of interest, the accretion or amortization of original
issue discount, the payment of interest on any Indebtedness in the form of
additional Indebtedness with the same terms, and the payment of dividends on
Disqualified Stock in the form of additional shares of the same class of
Disqualified Stock shall not be deemed to be an Incurrence of Indebtedness or an
issuance of Disqualified Stock for purposes of this Section 4.09.

         (d) Neither the Company nor any Subsidiary Guarantor shall Incur any
Indebtedness, including Permitted Debt, that is contractually subordinated in
right of payment to any other Indebtedness of the Company or such Subsidiary
Guarantor, as applicable, unless such Indebtedness is also contractually
subordinated in right of payment to the Notes or the Subsidiary Guarantee, as
applicable, on substantially identical terms; PROVIDED, HOWEVER, that no
Indebtedness of the Company or a Subsidiary Guarantor shall be deemed to be
contractually subordinated in right of payment to any other Indebtedness of the
Company or such Subsidiary Guarantor, as applicable, solely by virtue of being
unsecured.

         (e) For purposes of determining compliance with this Section 4.09, in
the event that an item of proposed Indebtedness meets the criteria of more than
one of the categories of Permitted Debt described in clauses (b)(1) through (13)
above, or is entitled to be Incurred pursuant to paragraph (a) of this Section
4.09, the Company shall be permitted to classify such item of Indebtedness on
the date of its Incurrence or later reclassify all or a portion of such item of
Indebtedness, in any manner that complies with this Section. Indebtedness under
Credit Facilities outstanding on the date on which Notes are first issued and
authenticated under this Indenture shall be deemed to have been Incurred on such
date in reliance on the exception provided by either clause (1) or (2) of
paragraph (b) of this Section 4.09, as applicable.

SECTION 4.10.     RESTRICTED PAYMENTS.

         (a) The Company shall not make, and shall not permit any Restricted
Subsidiary to make, directly or indirectly, any Restricted Payment, unless, if
at the time of and after giving effect to such Restricted Payment,

                                       46


         (1)   no Default or Event of Default has occurred and is continuing or
               would occur as a consequence of such Restricted Payment; and

         (2)   the Company would have been permitted to Incur at least US$1.00
               of additional Indebtedness, other than Permitted Debt, pursuant
               to the Debt to Cash Flow Ratio test set forth in Section 4.09(a)
               hereof; and

         (3)   such Restricted Payment, together with the aggregate amount of
               all other Restricted Payments declared or made after the Issue
               Date, excluding Restricted Payments made pursuant to clauses (2),
               (3), (4), (6), (7), (8), (9), (10), (11) and (12) of paragraph
               (b) below, shall not exceed, at the date of determination, the
               sum, without duplication, of:

               (a)      an amount equal to the Company's Consolidated Cash Flow
                        from the first date of the fiscal quarter in which the
                        Issue Date occurs to the end of the Company's most
                        recently ended full fiscal quarter for which internal
                        financial statements are available, taken as a single
                        accounting period, less the sum of 1.6 times the
                        Company's Consolidated Interest Expense from the first
                        date of the fiscal quarter in which the Issue Date
                        occurs to the end of the Company's most recently ended
                        full fiscal quarter for which internal financial
                        statements are available, taken as a single accounting
                        period; plus

               (b)      an amount equal to 100% of Capital Stock Sale Proceeds,
                        less any such Capital Stock Sale Proceeds used in
                        connection with:

                        (i)  an Investment made pursuant to clause (6) of the
                             definition of "Permitted Investments;" or

                        (ii) an Incurrence of Indebtedness pursuant
                             to Section 4.09(b)(4) hereof; plus

               (c)      to the extent that any Restricted Investment that was
                        made after the Issue Date is sold for cash or otherwise
                        liquidated or repaid for cash, the lesser of (i) the
                        cash return of capital with respect to such Restricted
                        Investment, less the cost of disposition, if any, and
                        (ii) the initial amount of such Restricted Investment;
                        plus

               (d)      to the extent that the Board of Directors designates any
                        Unrestricted Subsidiary that was designated as such
                        after the Issue Date as a Restricted Subsidiary, the
                        lesser of (i) the aggregate fair market value of all
                        Investments owned by the Company and the Restricted
                        Subsidiaries in such Subsidiary at the time such
                        Subsidiary was designated as an Unrestricted Subsidiary
                        and (ii) the then aggregate fair market value of all
                        Investments owned by the Company and the Restricted
                        Subsidiaries in such Unrestricted Subsidiary.

         (b) The provisions of paragraph (a) above shall not prohibit:

         (1)   so long as no Default has occurred and is continuing or would be
               caused thereby, the payment of any dividend within 60 days after
               the date the dividend is declared, if at that date of declaration
               such payment would have complied with the provisions of this
               Indenture; PROVIDED, HOWEVER, that such dividend shall be
               included in the calculation of the amount of Restricted Payments;

         (2)   so long as no Default has occurred and is continuing or would be
               caused thereby, the redemption, repurchase, retirement,
               defeasance or other acquisition of any Subordinated Indebtedness
               of the Company or of any Equity Interests of the Company in
               exchange for, or out of the net cash proceeds of the
               substantially concurrent sale, other than to a

                                       47


               Subsidiary of the Company or an employee stock ownership plan or
               to a trust established by the Company or any Subsidiary of the
               Company for the benefit of its employees, of, Equity Interests
               (other than Disqualified Stock or Back-to-Back Securities);

         (3)   so long as no Default has occurred and is continuing or would be
               caused thereby, the defeasance, redemption, repurchase or other
               acquisition of Subordinated Indebtedness of the Company or any
               Restricted Subsidiary with the net cash proceeds from an
               Incurrence of Permitted Refinancing Indebtedness;

         (4)   so long as no Default has occurred and is continuing or would be
               caused thereby, regardless of whether any Default then exists,
               any payment by the Company or a Restricted Subsidiary to any one
               of the other of them;

         (5)   so long as no Default has occurred and is continuing or would be
               caused thereby, the repurchase, redemption or other acquisition
               or retirement for value by the Company of any Equity Interests of
               the Company held by any member of the management of the Company
               or any of its Subsidiaries pursuant to any management equity
               subscription agreement or stock option agreement in effect as of
               the Issue Date; PROVIDED, HOWEVER, that the aggregate price paid
               for all such repurchased, redeemed, acquired or retired Equity
               Interests shall not exceed US$2.0 million in any twelve-month
               period;

         (6)   payments of any kind made in connection with or in respect of
               Back-to-Back Securities or the Existing Back-to-Back Securities;
               PROVIDED, HOWEVER, that to the extent such payments shall be made
               to Affiliates of the Company (other than its Subsidiaries), all
               corresponding payments required to be paid by such Affiliates
               pursuant to the related Back-to-Back Securities or Existing
               Back-to-Back Securities shall be received, immediately prior to
               or concurrently with any such payments, by all applicable Sun
               Media Entities;

         (7)   so long as no Default has occurred and is continuing or would be
               caused thereby, the payment of dividends and other shares of
               Capital Stock of the Company in the form of Capital Stock (other
               than Disqualified Stock or Back-to-Back Securities);

         (8)   so long as no Default has occurred and is continuing or would be
               caused thereby, any Tax Benefit Transaction;

         (9)   so long as no Default has occurred and is continuing or would be
               caused thereby, the payment of any Management Fees or other
               similar expenses by the Company to its direct or indirect parent
               company for bona fide services (including reimbursement for
               expenses Incurred in connection with, or allocation of corporate
               expenses in relation to, providing such services) provided to,
               and directly related to the operations of, the Company and the
               Restricted Subsidiaries, in an aggregate amount not to exceed
               1.5% of Consolidated Revenues in any twelve-month period;

         (10)  so long as no Default has occurred and is continuing or would be
               caused thereby, Restricted Payments in an amount equal to the
               amount of income tax refunds received by the Company or any
               Restricted Subsidiary in respect of fiscal years ended prior to
               the Issue Date not to exceed an aggregate of $30.0 million;

         (11)  so long as no Default has occurred and is continuing or would be
               caused thereby, other Restricted Payments in an aggregate amount
               not to exceed US$30.0 million; and

         (12)  the payment of dividends to 3351611 Canada Inc. on the Issue Date
               in an aggregate amount not to exceed Cdn$260.0 million.

                                       48


         (c) The amount of any Restricted Payment, other than those effected in
cash, shall be the fair market value on the date of the Restricted Payment of
the asset(s) or securities proposed to be transferred or issued to or by the
Company or such Restricted Subsidiary, as the case may be, pursuant to the
Restricted Payment. The fair market value of any assets or securities that are
required to be valued pursuant to this Section 4.10 shall be determined by the
Board of Directors whose resolution with respect thereto shall be delivered to
the Trustee. The determination of the Board of Directors shall be based upon an
opinion or appraisal issued by an accounting, appraisal or investment banking
firm of national standing in the United States or Canada if the fair market
value exceeds US$25.0 million; PROVIDED, that the Board of Directors shall not
be required to obtain such an opinion or appraisal in connection with the
payment of interest on Existing Back-to-Back Debt or any payments with respect
to Back-to-Back Securities to the extent such Back-to-Back Transactions were
approved in accordance with the provisions of Section 4.14 hereof. Not later
than the date of making any Restricted Payment, the Company shall deliver to the
Trustee an Officers' Certificate stating that such Restricted Payment is
permitted and setting forth the basis upon which the calculations required by
this Section 4.10 were computed, together with a copy of any fairness opinion or
appraisal required by this Indenture.

         (d) For purposes of this Section 4.10, if (i) any Sun Media Entity
ceases to be the obligor under or issuer of any Back-to-Back Securities or
Existing Back-to-Back Debt and a Person other than a Sun Media Entity becomes
the obligor thereunder (or the issuer of any Back-to-Back Preferred Shares) or
(ii) any Subsidiary Guarantor that is an obligor under or issuer of any
Back-to-Back Securities or the obligor under any Existing Back-to-Back Debt
ceases to be a Subsidiary Guarantor other than by consolidation or merger with
the Company or another Subsidiary Guarantor, then the Company or such Subsidiary
Guarantor shall be deemed to have made a Restricted Payment in an amount equal
to the accreted value of such Back-to-Back Debt or Existing Back-to-Back Debt
(or the subscription price of any Back-to-Back Preferred Shares) at the time of
the assumption thereof by such other Person or at the time such Subsidiary
Guarantor ceases to be a Subsidiary Guarantor.

SECTION 4.11.     LIENS.

         The Company shall not, and shall not permit any Restricted Subsidiary
to, directly or indirectly, create, incur, assume or suffer to exist any Lien of
any kind on any asset owned at the Issue Date or thereafter acquired, except
Permitted Liens, unless the Company or such Restricted Subsidiary has made or
will make effective provision to secure the Notes and any applicable Subsidiary
Guarantees by such Lien equally and ratably with all other Indebtedness of the
Company or such Restricted Subsidiary secured by such Lien for so long as such
other Indebtedness is secured by such Lien.

SECTION 4.12.     ASSET SALES.

         (a) The Company shall not, and shall not permit any Restricted
Subsidiary to, consummate an Asset Sale unless:

         (1)   the Company, or the Restricted Subsidiary, as the case may be,
               receives consideration at the time of the Asset Sale at least
               equal to the fair market value of the assets or Equity Interests
               issued or sold or otherwise disposed of;

         (2)   such fair market value is determined by the Company's Board of
               Directors and evidenced by a Board Resolution set forth in an
               Officers' Certificate delivered to the Trustee; and

         (3)   at least 75% of the consideration received in such Asset Sale by
               the Company or such Restricted Subsidiary is in the form of cash
               or Cash Equivalents. For purposes of this clause (3), each of the
               following shall be deemed to be cash:

               (a)      any Indebtedness or other liabilities, as shown on the
                        Company's or such Restricted Subsidiary's most recent
                        balance sheet, of the Company or any Restricted
                        Subsidiary, other than contingent liabilities and
                        Indebtedness that are by their terms subordinated to the
                        Notes, that are assumed by the transferee of any such
                        assets pursuant to an agreement that releases the
                        Company or such

                                       49


                        Restricted Subsidiary from further liability with
                        respect to such Indebtedness or liabilities; and

               (b)      any securities, notes or other obligations received by
                        the Company or any such Restricted Subsidiary from such
                        transferee that are converted within 60 days of the
                        applicable Asset Sale by the Company or such Restricted
                        Subsidiary into cash, to the extent of the cash received
                        in such conversion.

         (b) Notwithstanding the terms of paragraph (a) above, the Company and
the Restricted Subsidiaries may engage in Asset Swaps if (i) immediately after
giving effect to any such Asset Swap, the Company would be permitted to Incur at
least US$1.00 of additional Indebtedness pursuant to the Debt to Cash Flow Ratio
test set forth in Section 4.09(a), and (ii) the Company or such Restricted
Subsidiary receives consideration at the time of such Asset Swap at least equal
to the fair market value of the assets disposed of, which fair market value
shall be determined by the Board of Directors of the Company or the Restricted
Subsidiary, as the case may be, and evidenced by a Board Resolution set forth in
an Officers' Certificate delivered to the Trustee; PROVIDED, HOWEVER, that the
determination of the Board of Directors shall be based upon an opinion or
appraisal issued by an accounting, appraisal or investment banking firm of
national standing in the United States or Canada if the fair market value
exceeds US$25.0 million.

         (c) Within 360 days after the receipt of any Net Proceeds from an Asset
Sale, the Company may apply those Net Proceeds at its option:

         (1)   to permanently repay or reduce Indebtedness, other than
               Subordinated Indebtedness, of the Company or a Subsidiary
               Guarantor and, if the Indebtedness repaid is revolving credit
               Indebtedness, to correspondingly reduce commitments with respect
               thereto;

         (2)   to acquire, or enter into a binding agreement to acquire, all or
               substantially all of the assets (other than cash, Cash
               Equivalents and securities) of any Person engaged in a Permitted
               Business; PROVIDED, HOWEVER, that any such commitment shall be
               subject only to customary conditions (other than financing), and
               such acquisition shall be consummated no later than 180 days
               after the end of such 360-day period;

         (3)   to acquire, or enter into a binding agreement to acquire, Voting
               Stock of a Person engaged in a Permitted Business from a Person
               that is not an Affiliate of the Company; PROVIDED, HOWEVER, that
               such commitment shall be subject only to customary conditions
               (other than financing) and such acquisition shall be consummated
               no later than 180 days after the end of such 360-day period; and
               PROVIDED, FURTHER, HOWEVER, that (a) after giving effect thereto,
               the Person so acquired is a Restricted Subsidiary and (b) such
               acquisition is otherwise made in accordance with this Indenture,
               including, without limitation, Section 4.10 hereof; or

         (4)   to acquire, or enter into a binding agreement to acquire, other
               long-term assets (other than securities) that are used or useful
               in a Permitted Business; PROVIDED, HOWEVER, that such commitment
               shall be subject only to customary conditions (other than
               financing) and such acquisition shall be consummated no later
               than 180 days after the end of such 360-day period.

Pending the final application of any Net Proceeds, the Company may temporarily
reduce revolving credit borrowings or otherwise invest the Net Proceeds in any
manner that is not prohibited by this Indenture.

         (d) Any Net Proceeds from Asset Sales that are not applied, invested or
segregated from the general funds of the Company for investment in identified
assets pursuant to a binding agreement, in each case as provided in paragraph
(c) above shall constitute Excess Proceeds; PROVIDED, HOWEVER, that the amount
of any Net Proceeds that ceases to be so segregated as contemplated in paragraph
(c) above shall also constitute "Excess Proceeds" at the time any such Net
Proceeds cease to be so segregated; PROVIDED FURTHER, HOWEVER, that the amount

                                       50


of any Net Proceeds that continues to be segregated for investment and that is
not actually reinvested within twenty-four months from the date of the receipt
of such Net Proceeds shall also constitute "Excess Proceeds."

         (e) When the aggregate amount of Excess Proceeds exceeds US$20.0
million, the Company shall make an offer (and "ASSET SALE OFFER") to all Holders
of Notes and all holders of other Indebtedness that is PARI PASSU in right of
payment with the Notes subject to terms and conditions similar to those set
forth in this Indenture with respect to offers to purchase or redeem with the
proceeds of sales of assets to purchase the maximum principal amount of Notes
that may be purchased with the Allocable Excess Proceeds (as defined below) in
accordance with the procedures set forth in Section 3.09 hereof. The offer price
in any Asset Sale Offer shall be equal to 100% of principal amount plus accrued
and unpaid interest to the date of purchase, and shall be payable in cash. If
any Excess Proceeds remain after consummation of an Asset Sale Offer and all
Holders of Notes have been given the opportunity to tender their Notes for
purchase in accordance with such Asset Sale Offer and this Indenture, the
Company may use such Excess Proceeds for any purpose not otherwise prohibited by
this Indenture. If the aggregate principal amount of Notes and such other PARI
PASSU Indebtedness tendered into such Asset Sale Offer exceeds the amount of
Excess Proceeds, the Trustee shall select the Notes and such other PARI PASSU
Indebtedness to be purchased on a PRO RATA basis. Upon completion of each Asset
Sale Offer, the amount of Excess Proceeds shall be reset at zero.

         The term "ALLOCABLE EXCESS PROCEEDS" shall mean the product of:

         (i)   the Excess Proceeds and

         (ii)  a fraction,

               (a)      the numerator of which is the aggregate principal amount
                        of the Notes outstanding on the date of the Asset Sale
                        Offer, and

               (b)      the denominator of which is the sum of the aggregate
                        principal amount of the Notes outstanding on the date of
                        the Asset Sale Offer and the aggregate principal amount
                        of other Indebtedness of the Company outstanding on the
                        date of the Asset Sale Offer that is PARI PASSU in right
                        of payment with the Notes and subject to terms and
                        conditions in respect of Asset Sales similar in all
                        material respects to this Section 4.12 and requiring the
                        Company to make an offer to repurchase such Indebtedness
                        at substantially the same time as the Asset Sale Offer.

         The Company shall comply with the requirements of Rule 14e-1 under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with each
repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the
provisions of any securities laws or regulations conflict with the Asset Sales
provisions of this Indenture, the Company shall comply with the applicable
securities laws and regulations and shall not be deemed to have breached its
obligations under the Asset Sale provisions of this Indenture by virtue of such
conflict.

SECTION 4.13.     DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
                  SUBSIDIARIES.

         (a) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:

         (1)   pay dividends or make any other distributions on its Equity
               Interests to the Company or any other Restricted Subsidiary, or
               with respect to any other interest or participation in, or
               measured by, its profits, or pay any Indebtedness owed to the
               Company or any other Restricted Subsidiary;

                                       51


         (2)   make loans or advances, or guarantee any such loans or advances,
               to the Company or any other Restricted Subsidiary; or

         (3)   transfer any of its properties or assets to the Company or any
               other Restricted Subsidiary.

         (b) The restrictions set forth in paragraph (a) above shall not apply
to encumbrances or restrictions existing under or by reason of:

         (1)   agreements governing Existing Indebtedness and Credit Facilities
               as in effect on the Issue Date and any amendments, modifications,
               restatements, renewals, increases, supplements, refundings,
               replacements or refinancings thereof; PROVIDED, HOWEVER, that
               such amendments, modifications, restatements, renewals,
               increases, supplements, refundings, replacement or refinancings
               are no more restrictive, taken as a whole, with respect to such
               dividend and other payment restrictions than those contained in
               such Existing Indebtedness and Credit Facilities, as in effect on
               the Issue Date;

         (2)   this Indenture and the Notes;

         (3)   applicable law or any applicable rule, regulation or order;

         (4)   any instrument governing Indebtedness or Capital Stock of a
               Person acquired by the Company or any Restricted Subsidiary as in
               effect at the time of such acquisition (except to the extent such
               Indebtedness or Capital Stock was Incurred or issued in
               connection with or in contemplation of such acquisition), which
               encumbrance or restriction is not applicable to any Person, or
               the properties or assets of any Person, other than the Person, or
               the property or assets of the Person, so acquired; PROVIDED,
               HOWEVER, that, in the case of Indebtedness, such Indebtedness was
               permitted by the terms of this Indenture to be Incurred at the
               time of such acquisition;

         (5)   customary non-assignment provisions in leases entered into in the
               ordinary course of business and consistent with past practices;

         (6)   purchase money obligations for property acquired in the ordinary
               course of business that impose restrictions on the property so
               acquired of the nature described in clause (3) of paragraph (a)
               above;

         (7)   any agreement for the sale or other disposition of a Restricted
               Subsidiary that restricts distributions by such Restricted
               Subsidiary pending its sale or other disposition;

         (8)   Permitted Refinancing Indebtedness; PROVIDED, HOWEVER, that any
               restrictions contained in the agreements governing such Permitted
               Refinancing Indebtedness shall be no more restrictive, taken as a
               whole, than those contained in the agreements governing the
               Indebtedness being refinanced;

         (9)   Liens securing Indebtedness that is permitted to be secured
               without also securing the Notes or the applicable Subsidiary
               Guarantee pursuant to Section 4.11 hereof that limit the right of
               the debtor to dispose of the assets subject to any such Lien;

         (10)  provisions with respect to the disposition or distribution of
               assets or property in joint venture agreements, asset sale
               agreements, stock sale agreements and other similar agreements
               entered into in the ordinary course of business;

         (11)  restrictions on cash or other deposits or net worth imposed by
               customers under contracts entered into in the ordinary course of
               business; and

                                       52


         (12)  any Indebtedness or any agreement pursuant to which such
               Indebtedness was issued if the encumbrance or restriction applies
               only upon a payment or financial covenant default or event of
               default contained in such Indebtedness or agreement and (A) such
               encumbrance or restriction is not materially more disadvantageous
               to the Holders than is customary in comparable financings (as
               determined in good faith by the Board of Directors of the
               Company) or (B) management of the Company delivers to the Trustee
               an Officers' Certificate evidencing its determination at the time
               such agreement is entered into, that such encumbrance or
               restriction will not materially impair the Company's ability to
               make payments on the Notes.

SECTION 4.14.     TRANSACTIONS WITH AFFILIATES.

         (a) The Company shall not, and shall not permit any Restricted
Subsidiary to, directly or indirectly, make any payment to, or sell, lease,
transfer, exchange or otherwise dispose of any of its properties or assets to,
or purchase any property or assets from, or enter into or make or amend any
transaction or series of transactions, contract, agreement, understanding, loan,
advance or guarantee with, or for the benefit of, any Affiliate, officer or
director of the Company (each, an "AFFILIATE TRANSACTION") unless:

         (1)   such Affiliate Transaction is (a) set forth in writing and (b) on
               terms that are no less favorable to the Company or the relevant
               Restricted Subsidiary than those that would have been obtained in
               a comparable arm's length transaction by the Company or such
               Restricted Subsidiary with an unrelated Person; and

         (2)   the Company delivers to the Trustee:

               (i)      with respect to any Affiliate Transaction or series of
                        related Affiliate Transactions involving aggregate
                        consideration in excess of US$10.0 million, a Board
                        Resolution set forth in an Officers' Certificate
                        certifying that such Affiliate Transaction complies with
                        this Section 4.14 and that such Affiliate Transaction
                        has been approved by a majority of the disinterested
                        members of the Board of Directors; and

               (ii)     with respect to any Affiliate Transaction or series of
                        related Affiliate Transactions involving aggregate
                        consideration in excess of US$25.0 million, an opinion
                        as to the fairness to the Company or such Restricted
                        Subsidiary of such Affiliate Transaction from a
                        financial point of view issued by an accounting,
                        appraisal or investment banking firm of national
                        standing in the United States or Canada.

         (b) The following items shall be deemed not to constitute Affiliate
Transactions and, therefore, shall not be subject to the provisions of paragraph
(a) above:

         (1)   any employment agreement entered into by the Company or any
               Restricted Subsidiary in the ordinary course of business and
               consistent with the past practice of the Company or such
               Restricted Subsidiary;

         (2)   transactions between or among the Company and/or the Restricted
               Subsidiaries;

         (3)   transactions with a Person that is an Affiliate of the Company
               solely because the Company owns an Equity Interest in such
               Person;

         (4)   payment of reasonable directors fees to Persons who are not
               otherwise Affiliates of the Company;

         (5)   sales of Equity Interests, other than Disqualified Stock, to
               Affiliates of the Company;

                                       53


         (6)   any agreement or arrangement as in effect on the Issue Date or
               any amendment thereto or any transaction contemplated thereby,
               including pursuant to any amendment thereto, in any replacement
               agreement or arrangement thereto so long as any such amendment or
               replacement agreement or arrangement is not more disadvantageous
               to the Company or the Restricted Subsidiaries, as the case may
               be, in any material respect than the original agreement as in
               effect on the Issue Date;

         (7)   Restricted Payments that are permitted by the provisions of
               Section 4.10 hereof;

         (8)   Permitted Investments;

         (9)   any transaction permitted by the provisions of Section 5.01
               hereof; and

         (10)  any Tax Benefit Transaction.

SECTION 4.15.     SALE AND LEASEBACK TRANSACTIONS.

         The Company shall not, and shall not permit any Restricted Subsidiary
to, enter into any sale and leaseback transaction; PROVIDED, HOWEVER, that the
Company or any Restricted Subsidiary may enter into a sale and leaseback
transaction if:

         (a)   the Company or that Restricted Subsidiary, as applicable, could
               have (i) Incurred Indebtedness in an amount equal to the
               Attributable Debt relating to such sale and leaseback transaction
               under the Debt to Cash Flow Ratio test set forth in Section
               4.09(a) hereof and (ii) created a Lien on such property securing
               Attributable Debt pursuant to the provisions of Section 4.11
               hereof;

         (b)   the net cash proceeds of such sale and leaseback transaction are
               at least equal to the fair market value, as determined in good
               faith by the Board of Directors and set forth in an Officers'
               Certificate delivered to the Trustee, of the property that is the
               subject of that sale and leaseback transaction; and

         (c)   the transfer of assets in such sale and leaseback transaction is
               permitted by, and the Company or such Restricted Subsidiary
               applies the proceeds of such transaction in compliance with, the
               provisions of Section 4.12 hereof.

SECTION 4.16.     ISSUANCES AND SALES OF EQUITY INTERESTS IN SUBSIDIARIES.

         (a) The Company shall not, and shall not permit any Restricted
Subsidiary to, transfer, convey, sell, lease or otherwise dispose of (including,
without limitation, by way of merger, amalgamation or otherwise) any Equity
Interests in any direct or indirect Restricted Subsidiary that is a Significant
Subsidiary of the Company or any group of Restricted Subsidiaries which, when
taken as a whole, would constitute a Significant Subsidiary, to any Person
(other than the Company or a Wholly Owned Restricted Subsidiary thereof or to
Quebecor Inc. or a direct or indirect Subsidiary of Quebecor Inc. in connection
with a Tax Benefit Transaction), unless:

         (1)   such transfer, conveyance, sale, lease or other disposition
               (whether by way of merger, amalgamation or otherwise) is of all
               the Equity Interests of such Restricted Subsidiary; and

         (2)   the Net Proceeds from such transfer, conveyance, sale, lease or
               other disposition (whether by way of merger, amalgamation or
               otherwise) are applied in accordance with the provisions of
               Section 4.12 hereof.

         (b) The Company shall not permit any direct or indirect Restricted
Subsidiary that constitutes a Significant Subsidiary or any group of Restricted
Subsidiaries which, when taken as a whole, would constitute a

                                       54



Significant Subsidiary, to issue any Equity Interests to any Person, other than,
(1) if necessary, shares of Capital Stock constituting directors' qualifying
shares or (2) to the Company or a Wholly Owned Restricted Subsidiary thereof.

SECTION 4.17.     DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.

         (a) The Board of Directors may designate any Subsidiary to be an
Unrestricted Subsidiary if such Subsidiary:

         (1)   has no Indebtedness other than Non-Recourse Debt;

         (2)   is not party to any agreement, contract, arrangement or
               understanding with the Company or any Restricted Subsidiary
               unless the terms of any such agreement, contract, arrangement or
               understanding are no less favorable to the Company or such
               Restricted Subsidiary than those that might be obtained at the
               time from Persons who are not Affiliates of the Company;

         (3)   is a Person with respect to which neither the Company nor any
               Restricted Subsidiary has any direct or indirect obligation (a)
               to subscribe for additional Equity Interests or (b) to maintain
               or preserve such Person's financial condition or to cause such
               Person to achieve any specified levels of operating results;

         (4)   except in the case of a Subsidiary Guarantor that is designated
               as an Unrestricted Subsidiary in accordance with this Indenture,
               has not guaranteed or otherwise directly or indirectly provided
               credit support for any Indebtedness of the Company or any
               Restricted Subsidiary;

         (5)   has at least one director on its Board of Directors that is not a
               director or executive officer of the Company or any Restricted
               Subsidiary and has at least one executive officer that is not a
               director or executive officer of the Company or any Restricted
               Subsidiary; and

         (6)   such designation would not cause a Default or Event of Default.

         (b) Any designation of a Subsidiary of the Company as an Unrestricted
Subsidiary shall be evidenced to the Trustee by filing with the Trustee a
certified copy of the Board Resolution giving effect to such designation and an
Officers' Certificate certifying that such designation complied with the
provisions of paragraph (a) above and was permitted by the provisions of Section
4.10 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the
requirements of the provisions of paragraph (a) above, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of this Indenture and any
Preferred Shares of such Subsidiary shall be deemed to be issued and any
Indebtedness of such Subsidiary shall be deemed to be Incurred by a Restricted
Subsidiary as of such date and, if such Preferred Shares are not permitted to be
issued or such Indebtedness is not permitted to be Incurred as of such date
under the provisions of Section 4.09 hereof, the Company shall be in default of
such Section.

         (c) If a Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate fair market value of all outstanding Investments owned
by the Company and the Restricted Subsidiaries in the Subsidiary so designated
shall be deemed to be an Investment made as of the time of such designation and
shall either reduce the amount available for Restricted Payments under Section
4.10(a) hereof or reduce the amount available for future Investments under one
or more clauses of the definition of Permitted Investments, as the Company shall
determine. Such designation shall be permitted only if such Investment would be
permitted at such time and if such Restricted Subsidiary otherwise meets the
requirements of the provisions of paragraph (a) above. Upon designation of a
Restricted Subsidiary as an Unrestricted Subsidiary in compliance with this
Section 4.17, such Subsidiary shall, by execution and delivery of a supplemental
indenture in form satisfactory to the Trustee, be released from any Subsidiary
Guarantee previously made by such Subsidiary in accordance with the provisions
of Section 10.05 hereof.

                                       55


         (d) The Board of Directors of the Company may at any time designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; PROVIDED, HOWEVER, that
such designation shall be deemed to be an Incurrence of Indebtedness by a
Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted
Subsidiary and such designation shall be permitted only if (i) such Indebtedness
is permitted under the provisions of Section 4.09 hereof, calculated on a PRO
FORMA basis as if such designation had occurred at the beginning of the
four-quarter reference period; and (ii) no Default or Event of Default would be
in existence following such designation.

SECTION 4.18.     REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL.

         (a) Upon the occurrence of a Change of Control, the Company shall,
within 30 days of a Change of Control, make an offer (the "CHANGE OF CONTROL
OFFER") pursuant to the procedures set forth in Section 3.09 hereof. Each Holder
shall have the right to accept such offer and require the Company to repurchase
all or any part (equal to US$1,000 or an integral multiple of US$1,000) of such
Holder's Notes pursuant to the Change of Control Offer at a purchase price, in
cash (the "CHANGE OF CONTROL AMOUNT"), equal to 101% of the aggregate principal
amount of Notes repurchased, plus accrued and unpaid interest on the Notes
repurchased to the purchase date.

         (b) The Company shall not be required to make a Change of Control Offer
upon a Change of Control if a third party makes a Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Indenture applicable to a Change of Control Offer made by the Company
and purchases all Notes or portions of Notes properly tendered and not withdrawn
under the Change of Control Offer.

SECTION 4.19.     FUTURE GUARANTORS.

         The Company shall cause each Person that (a) becomes a Restricted
Subsidiary following the Issue Date and (b) guarantees any Indebtedness
(including any Back-to-Back Debt or the Existing Back-to-Back Debt) of the
Company or any Subsidiary thereof to execute and deliver to the Trustee a
Subsidiary Guarantee at the time such Person becomes obligated under any such
guarantee.

SECTION 4.20.     ADDITIONAL AMOUNTS.

         (a) All payments made by or on behalf of the Company on or with respect
to the Notes shall be made without withholding or deduction for any Taxes
imposed by any Canadian Taxing Authority, unless required by law or the
interpretation or administration thereof by the relevant Taxing Authority. If
the Company or any other payor is required to withhold or deduct any amount on
account of Taxes from any payment made under or with respect to any Notes that
are outstanding on the date of the required payment, the Company shall:

         (1)   make such withholding or deduction;

         (2)   remit the full amount deducted or withheld to the relevant
               government authority in accordance with applicable law;

         (3)   pay the additional amounts ("ADDITIONAL AMOUNTS") as may be
               necessary so that the net amount received by each holder
               (including Additional Amounts) after such withholding or
               deduction will not be less than the amount the holder would have
               received if such Taxes had not been withheld or deducted;

         (4)   furnish to the Holders, within 30 days after the date the payment
               of any Taxes is due, certified copies of tax receipts evidencing
               such payment by the Company;

         (5)   indemnify and hold harmless each Holder (other than an Excluded
               Holder, as defined in paragraph (b) below) for the amount of (a)
               any Taxes paid by such Holder as a result of payments made on or
               with respect to the Notes, (b) any liability (including
               penalties, interest and expenses) arising from or with respect to
               such payments and (c) any Taxes imposed with respect to any
               reimbursement under the foregoing clauses (a) or (b), but

                                       56


               excluding any such Taxes that are in the nature of Taxes on net
               income, taxes on capital, franchise taxes, net worth taxes and
               similar taxes; and

         (6)   at least 30 days prior to each date on which any payment under or
               with respect to the Notes is due and payable, if the Company
               becomes obligated to pay Additional Amounts with respect to such
               payment, deliver to the Trustee an Officers' Certificate stating
               the amounts so payable and such other information necessary to
               enable the Trustee to pay such Additional Amounts to Holders on
               the payment date.

         (b) Notwithstanding the provisions of paragraph (a) above, no
Additional Amounts shall be payable to a Holder in respect of beneficial
ownership of a Note (an "EXCLUDED HOLDER"):

         (1)   with which the Company does not deal at arm's-length, within the
               meaning of the INCOME TAX ACT (Canada), at the time of making
               such payment;

         (2)   which is subject to such Taxes by reason of its being connected
               with Canada or any province or territory thereof otherwise than
               by the mere acquisition, holding or disposition of Notes or the
               receipt of payments thereunder; or

         (3)   if such Holder waives its right to receive Additional Amounts.

         Any reference, in any context in this Indenture, to the payment of
principal, premium, if any, redemption price, Change of Control Amount, offer
price and interest or any other amount payable under or with respect to any
Note, shall be deemed to include the payment of Additional Amounts to the extent
that, in such context, Additional Amounts are, were or would be payable.

                                   ARTICLE 5.

                                   SUCCESSORS

SECTION 5.01.     MERGER, CONSOLIDATION AND SALE OF ASSETS OF THE COMPANY AND
                  SUBSIDIARY GUARANTORS.

         (a) The Company may not directly or indirectly, (i) consolidate, merge
or amalgamate with or into another Person, whether or not the Company is the
surviving corporation, or (ii) sell, assign, transfer, convey or otherwise
dispose of all or substantially all of the properties or assets of the Company
and the Restricted Subsidiaries, taken as a whole, in one or more related
transactions, to another Person, unless, in either case,

         (1)   either (a) the Company is the surviving corporation, or (b) the
               Person formed by or surviving any such consolidation, merger or
               amalgamation (if other than the Company) or to which such sale,
               assignment, transfer, conveyance or other disposition shall have
               been made (the "SURVIVING COMPANY") is a corporation, limited
               liability company or limited partnership organized or existing
               under the laws of the United States, any state of the United
               States, the District of Columbia, Canada or any province or
               territory of Canada;

         (2)   the Surviving Company expressly assumes all the obligations of
               the Company under the Notes, this Indenture and, if applicable,
               any Registration Rights Agreements, pursuant to agreements
               reasonably satisfactory to the Trustee;

         (3)   immediately after giving effect to such transaction no Default or
               Event of Default exists; and

         (4)   the Company or the Surviving Company shall, on the date of such
               transaction after giving PRO FORMA effect thereto and any related
               financing transactions as if the same had occurred at the
               beginning of the applicable fiscal quarter, be permitted to Incur
               at least

                                       57


               US$1.00 of additional Indebtedness pursuant to the Debt to Cash
               Flow Ratio test set forth in Section 4.09(a) hereof.

         (b) Unless in connection with a disposition by the Company or a
Subsidiary Guarantor of its entire ownership interest in a Subsidiary Guarantor
or all or substantially all the assets of a Subsidiary Guarantor permitted by,
and in accordance with the applicable provisions of, this Indenture, the Company
shall cause each Subsidiary Guarantor not to directly or indirectly, (i)
consolidate, merge or amalgamate with or into another Person, whether or not
such Subsidiary Guarantor is the surviving corporation, or (ii) sell, assign,
transfer, convey or otherwise dispose of all or substantially all of the
properties or assets of such Subsidiary Guarantor, in one or more related
transactions, to another Person, unless, in either case,

         (1)   either (a) such Subsidiary Guarantor is the surviving
               corporation, or (b) the Person formed by or surviving any such
               consolidation, merger or amalgamation (if other than such
               Subsidiary Guarantor) or to which such sale, assignment,
               transfer, conveyance or other disposition shall have been made
               (the "SURVIVING GUARANTOR") is a corporation, limited liability
               company or limited partnership organized or existing under the
               laws of the United States, any state of the United States, the
               District of Columbia, Canada or any province or territory of
               Canada;

         (2)   the Surviving Guarantor expressly assumes all the obligations of
               such Subsidiary Guarantor under its Subsidiary Guarantee, this
               Indenture and, if applicable, any Registration Rights Agreements,
               pursuant to agreements reasonably satisfactory to the Trustee;

         (3)   immediately after giving effect to such transaction no Default or
               Event of Default exists; and

         (4)   such Subsidiary Guarantor or the Surviving Guarantor shall, on
               the date of such transaction after giving PRO FORMA effect
               thereto and any related financing transactions as if the same had
               occurred at the beginning of the applicable fiscal quarter, be
               permitted to Incur at least US$1.00 of additional Indebtedness
               pursuant to the Debt to Cash Flow Ratio test set forth in Section
               4.09(a) hereof.

         (c) In addition, the Company shall not, and shall cause each Subsidiary
Guarantor not to, directly or indirectly, lease all or substantially all of its
properties or assets, in one or more related transactions, to any other Person.
This Section 5.01 shall not apply to a merger, consolidation or amalgamation, or
a sale, assignment, transfer, conveyance or other disposition of assets, between
or among the Company and any Restricted Subsidiary.

SECTION 5.02.     SUCCESSOR CORPORATION SUBSTITUTED.

         Each Surviving Company and Surviving Guarantor shall succeed to, and be
substituted for, and may exercise every right and power of the Company or a
Subsidiary Guarantor, as applicable, under this Indenture; PROVIDED, HOWEVER,
that in the case of:

         (a) a sale, transfer, assignment, conveyance or other disposition
(unless such sale, transfer, assignment, conveyance or other disposition is of
all or substantially all of the assets of the Company and the Restricted
Subsidiaries, taken as a whole, or in the case of a Subsidiary Guarantor, such
sale, transfer, assignment, conveyance or other disposition is of all or
substantially all of the assets of such Subsidiary Guarantor or all of the
Capital Stock of such Subsidiary Guarantor to a Person that is not (either
before or after giving effect to such transactions) a Subsidiary of the
Company), or

         (b) a lease,

the predecessor company shall not be released from any of the obligations or
covenants under this Indenture, including with respect to the payment of the
Notes and obligations under the Subsidiary Guarantees.

                                       58


                                   ARTICLE 6.

                              DEFAULTS AND REMEDIES

SECTION 6.01.     EVENTS OF DEFAULT.

         Each of the following is an "Event of Default:"

             (i) default for 30 days in the payment when due of interest on,
     including Additional Amounts or Special Interest, if any, or with respect
     to, the Notes;

             (ii) default in payment, when due at Stated Maturity, upon
     acceleration, redemption, required repurchase or otherwise, of the
     principal of, or premium, if any, on the Notes;

             (iii) failure by the Company or any Restricted Subsidiary to comply
     with the provisions of Section 4.09, 4.10, 4.12, 4.18 or 5.01 hereof;

             (iv) failure by the Company or any Restricted Subsidiary for 30
     days after written notice thereof has been given to the Company by the
     Trustee or to the Company and the Trustee by the Holders of at least 25% of
     the aggregate principal amount of the Notes outstanding to comply with any
     of its other covenants or agreements in this Indenture;

             (v) default under any mortgage, indenture or instrument under which
     there may be issued or by which there may be secured or evidenced any
     Indebtedness by the Company or any Restricted Subsidiary, or the payment of
     which is guaranteed by the Company or any Restricted Subsidiary, whether
     such Indebtedness or guarantee now exists, or is created after the Issue
     Date, if that default:

               (a)      is caused by a failure to pay principal of, or interest
                        or premium, if any, on, such Indebtedness prior to the
                        expiration of the grace period provided in such
                        Indebtedness on the date of such default (a "PAYMENT
                        DEFAULT"); or

               (b)      results in the acceleration of such Indebtedness prior
                        to its Stated Maturity,

     and, in each case, the principal amount of any such Indebtedness, together
     with the principal amount of any other such Indebtedness under which there
     has been a Payment Default or the maturity of which has been so
     accelerated, aggregates US$25.0 million or more;

             (vi) failure by the Company or any Restricted Subsidiary to pay
     final, non-appealable judgments aggregating in excess of US$25.0 million,
     which judgments are not paid, discharged or stayed for a period of 60 days;

             (vii) any Subsidiary Guarantee of a Significant Subsidiary ceases,
     or the Subsidiary Guarantees of any group of Subsidiaries that, when taken
     together, would constitute a Significant Subsidiary cease, to be in full
     force and effect (other than in accordance with the terms of any such
     Subsidiary Guarantee) or any Subsidiary Guarantor that is a Significant
     Subsidiary denies or disaffirms its obligations under its Subsidiary
     Guarantee, or a group of Subsidiary Guarantors that, when taken together,
     would constitute a Significant Subsidiary deny or disaffirm their
     obligations under their respective Subsidiary Guarantees;

             (viii) the Company or any of its Significant Subsidiaries or any
     group of Subsidiaries that, when taken together, would constitute a
     Significant Subsidiary, pursuant to or within the meaning of any Bankruptcy
     Law:

                  (A) commences a voluntary case or gives notice of intention to
             make a proposal under any Bankruptcy Law;

                                       59


                  (B) consents to the entry of an order for relief against it in
             an involuntary case or consents to its dissolution or winding up;

                  (C) consents to the appointment of a receiver, interim
             receiver, receiver and manager, liquidator, trustee or custodian of
             it or for all or substantially all of its property;

                  (D) makes a general assignment for the benefit of its
             creditors;

                  (E) admits in writing its inability to pay its debts as they
             become due or otherwise admits its insolvency; or

                  (F) seeks a stay of proceedings against it or proposes or
             gives notice or intention to propose a compromise, arrangement or
             reorganization of any of its debts or obligations under any
             Bankruptcy Law; and

             (ix) a court of competent jurisdiction enters an order or decree
     under any Bankruptcy Law that:

                  (A) is for relief against the Company or any of its
             Significant Subsidiaries or any group of Subsidiaries that, when
             taken together, would constitute a Significant Subsidiary, in an
             involuntary case; or

                  (B) appoints a receiver, interim receiver, receiver and
             manager, liquidator, trustee or custodian of the Company or any of
             its Significant Subsidiaries or any group of Subsidiaries that,
             when taken together, would constitute a Significant Subsidiary, or
             for all or substantially all of the property of the Company or any
             of its Significant Subsidiaries or any group of Subsidiaries that,
             when taken together, would constitute a Significant Subsidiary;

                  (C) orders the liquidation of the Company or any of its
             Significant Subsidiaries or any group of Subsidiaries that, when
             taken together, would constitute a Significant Subsidiary; or

                  (D) orders the presentation of any plan or arrangement,
             compromise or reorganization of the Company or any of its
             Significant Subsidiaries or any group of Subsidiaries that, when
             taken together, would constitute a Significant Subsidiary;

             and such order or decree remains unstayed and in effect for
             60 consecutive days.

SECTION 6.02.     ACCELERATION.

         If any Event of Default (other than those of the type described in
Section 6.01(viii) or (ix) occurs and is continuing, the Trustee may, and the
Trustee upon the request of Holders of 25% in principal amount of the
outstanding Notes shall, or the Holders of at least 25% in principal amount of
outstanding Notes may, declare the principal of all the Notes, together with all
accrued and unpaid interest, premium, if any, to be due and payable by notice in
writing to the Company and the Trustee specifying the respective Event of
Default and that such notice is a notice of acceleration (the "ACCELERATION
NOTICE"), and the same shall become immediately due and payable.

         In the case of an Event of Default specified in Section 6.01(viii) or
(ix) hereof, all outstanding Notes shall become due and payable immediately
without further action or notice by the Trustee or the Holders. Holders may not
enforce this Indenture or the Notes except as provided in this Indenture.

         At any time after a declaration of acceleration with respect to the
Notes, the Holders of a majority

                                       60



in principal amount of the Notes then outstanding (by notice to the Trustee) may
rescind and cancel such declaration and its consequences if:

         (a) the rescission would not conflict with any judgment or decree of a
court of competent jurisdiction;

         (b) all existing Defaults and Events of Default have been cured or
waived except nonpayment of principal of or interest on the Notes that has
become due solely by such declaration of acceleration;

         (c) to the extent the payment of such interest is lawful, interest (at
the same rate specified in the Notes) on overdue installments of interest and
overdue payments of principal which has become due otherwise than by such
declaration of acceleration has been paid;

         (d) the Company has paid the Trustee its reasonable compensation and
reimbursed the Trustee for its reasonable expenses, disbursements and advances;
and

         (e) in the event of the cure or waiver of an Event of Default of the
type described in Section 6.01(viii) or (ix), the Trustee has received an
Officers' Certificate and Opinion of Counsel that such Event of Default has been
cured or waived.

         In the case of an Event of Default with respect to the Notes occurring
by reason of any willful action or inaction taken or not taken by the Company or
on the Company's behalf with the intention of avoiding payment of the premium
that the Company would have been required to pay if the Company had then elected
to redeem the Notes pursuant to Section 3.07 hereof, an equivalent premium shall
also become and be immediately due and payable to the extent permitted by law
upon the acceleration of the Notes. If an Event of Default occurs prior to
February 15, 2008, by reason of any willful action or inaction taken or not
taken by the Company or on the Company's behalf with the intention of avoiding
the prohibition on redemption of the Notes prior to February 15, 2008, then the
premium specified in Section 3.07 hereof shall also become immediately due and
payable to the extent permitted by law upon acceleration of the Notes.

SECTION 6.03.     OTHER REMEDIES.

         If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.

         The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies shall be
cumulative to the extent permitted by law.

SECTION 6.04.     WAIVER OF PAST DEFAULTS.

         The Holders of at least a majority in aggregate principal amount of the
Notes then outstanding by notice to the Trustee may on behalf of the Holders of
all of the Notes waive any existing Default or Event of Default, and its
consequences, except a continuing Default or Event of Default (i) in the payment
of the principal of or interest on the Notes and (ii) in respect of a covenant
or provision which under this Indenture cannot be modified or amended without
the consent of the Holder of each Note affected by such modification or
amendment. Upon any waiver of a Default or Event of Default such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed cured
for every purpose of this Indenture, but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereon.

                                       61


SECTION 6.05.     CONTROL BY MAJORITY.

         Subject to Section 7.01, Section 7.02(f) (including the Trustee's
receipt of the security or indemnification described therein) and Section 7.07
hereof, in case an Event of Default shall occur and be continuing, the Holders
of a majority in aggregate principal amount of the Notes then outstanding shall
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on the Trustee with respect to the Notes.

SECTION 6.06.     LIMITATION ON SUITS.

         No Holder shall have any right to institute any proceeding with respect
to this Indenture, or for the appointment of a receiver or trustee, or for any
remedy thereunder, unless:

         (a) such Holder has previously given to the Trustee written notice of a
continuing Event of Default,

         (b) Holders of at least 25% in aggregate principal amount of the Notes
then outstanding have made written request and offered reasonable indemnity to
the Trustee to institute such proceeding as trustee, and

         (c) the Trustee shall not have received from the Holders of a majority
in aggregate principal amount of the Notes then outstanding a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days.

         The preceding limitations shall not apply to a suit instituted by a
Holder for enforcement of payment of principal of, and premium, if any, or
interest on, a Note on or after the respective due dates for such payments set
forth in such Note.

         A Holder may not use this Indenture to affect, disturb or prejudice the
rights of another Holder or to obtain a preference or priority over another
Holder.

SECTION 6.07.     RIGHTS OF HOLDERS TO RECEIVE PAYMENT.

         Notwithstanding any other provision of this Indenture (including,
without limitation, Section 6.06 hereof), the right of any Holder to receive
payment of principal, premium, if any, and interest on the Notes held by such
Holder, on or after the respective due dates expressed in the Notes (including
in connection with an offer to purchase), or to bring suit for the enforcement
of any such payment on or after such respective dates, shall not be impaired or
affected without the consent of such Holder.

SECTION 6.08.     COLLECTION SUIT BY TRUSTEE.

         If an Event of Default specified in Section 6.01 (i) or (ii) occurs and
is continuing, the Trustee is authorized to recover judgment in its own name and
as trustee of an express trust against the Company for the whole amount of
principal of, premium, if any, and interest then due and owing (together with
interest on overdue principal and, to the extent lawful, interest) and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

SECTION 6.09.     TRUSTEE MAY FILE PROOFS OF CLAIM.

         The Trustee shall be authorized to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders allowed in any judicial proceedings relative to the Company (or any
other obligor upon the Notes), its creditors or its property and shall be
entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims and any custodian in any such
judicial proceeding is hereby authorized by each

                                       62



Holder to make such payments to the Trustee, and in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay to
the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.07 hereof. To the extent that the
payment of any such compensation, expenses, disbursements and advances of the
Trustee and its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof out of the estate in any such proceeding, shall be denied
for any reason, payment of the same shall be secured by a Lien on, and shall be
paid out of, any and all distributions, moneys, securities and any other
properties that the Holders may be entitled to receive in such proceeding
whether in liquidation or under any plan of reorganization or arrangement or
otherwise. Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder, or to authorize the Trustee to vote in respect of the
claim of any Holder in any such proceeding.

SECTION 6.10.     PRIORITIES.

         If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:

         FIRST: to the Trustee, its agents and attorneys for amounts due under
Section 7.07 hereof, including payment of all compensation, expenses and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;

         SECOND: to Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest ratably, without preference or priority
of any kind, according to the amounts due and payable on the Notes for
principal, premium, if any, and interest, respectively; and

         THIRD: to the Company or to such party as a court of competent
jurisdiction shall direct.

         The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 6.10.

SECTION 6.11.     UNDERTAKING FOR COSTS.

         In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.11 shall not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.

                                   ARTICLE 7.

                                    TRUSTEE

SECTION 7.01.     DUTIES OF TRUSTEE.

         (a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise, as a prudent Person would
exercise or use under the circumstances in the conduct of such Person's own
affairs.

         (b) Except during the continuance of an Event of Default:

               (1) the duties of the Trustee shall be determined solely by the
         express provisions of this Indenture and the Trustee need perform only
         those duties that are

                                       63


         specifically set forth in this Indenture and no others, and no implied
         covenants or obligations shall be read into this Indenture against the
         Trustee; and

               (2) in the absence of bad faith on its part, the Trustee may
         conclusively rely, as to the truth of the statements and the
         correctness of the opinions expressed therein, upon certificates or
         opinions furnished to the Trustee and conforming to the requirements of
         this Indenture. However, the Trustee shall examine the certificates and
         opinions to determine whether or not they conform to the requirements
         of this Indenture (but need not confirm or investigate the accuracy of
         mathematical calculations or other facts stated therein).

         (c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

               (1) this paragraph does not limit the effect of paragraph (b) of
         this Section;

               (2) the Trustee shall not be liable for any error of judgment
         made in good faith by a Responsible Officer, unless it is proved that
         the Trustee was negligent in ascertaining the pertinent facts; and

               (3) the Trustee shall not be liable with respect to any action it
         takes or omits to take in good faith in accordance with a direction
         received by it pursuant to Section 6.05 hereof.

         (d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to paragraphs
(a), (b) and (c) of this Section 7.01.

         (e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holders, unless such Holder shall have
offered to the Trustee security and indemnity satisfactory to it against any
loss, liability or expense.

         (f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.

SECTION 7.02.     RIGHTS OF TRUSTEE.

         (a) The Trustee may conclusively rely upon any document believed by it
to be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in any such document.

         (b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel and the written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.

         (c) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture.

         (d) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.

                                       64


         (e) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.

         (f) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
Default or Event of Default is received by a Responsible Officer of the Trustee
at the Corporate Trust Office of the Trustee from the Company or the Holders of
25% in aggregate principal amount of the outstanding Notes, and such notice
references the specific Default or Event of Default, the Notes and this
Indenture.

         (g) The Trustee shall not be required to give any bond or surety in
respect of the performance of its power and duties hereunder.

         (h) The Trustee shall have no duty to inquire as to the performance of
the Company's covenants herein.

         (i) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder.

SECTION 7.03.     INDIVIDUAL RIGHTS OF TRUSTEE.

         The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the Commission
for permission to continue as Trustee or resign. Any Agent may do the same with
like rights and duties. The Trustee shall also be subject to Sections 7.10 and
7.11 hereof.

SECTION 7.04.     TRUSTEE'S DISCLAIMER.

         The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company's use of the proceeds from the Notes or any money
paid to the Company or upon the Company's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the sale of the Notes or pursuant to this
Indenture other than its certificate of authentication.

SECTION 7.05.     NOTICE OF DEFAULTS.

         If a Default or Event of Default occurs and is continuing and if it is
known to the Trustee, the Trustee shall mail to Holders a notice of the Default
or Event of Default within 90 days after it occurs. Except in the case of a
Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders.

SECTION 7.06.     REPORTS BY TRUSTEE TO HOLDERS.

         Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders a brief report dated as of such reporting date
that complies with TIA Section 313(a) (but if no event described in TIA Section
313(a) has occurred within the twelve months preceding the reporting date, no
report need be transmitted). The Trustee also shall comply with TIA Section
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA Section 313(c).

                                       65


         A copy of each report at the time of its mailing to the Holders shall
be mailed to the Company and filed with the Commission and each stock exchange
on which the Notes are listed in accordance with TIA Section 313(d). The Company
shall promptly notify the Trustee when the Notes are listed on any stock
exchange and any delisting thereof.

SECTION 7.07.     COMPENSATION AND INDEMNITY.

         The Company shall pay to the Trustee from time to time reasonable
compensation for its acceptance of this Indenture and services hereunder. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.

         The Company shall indemnify the Trustee (in its capacity as Trustee) or
any predecessor Trustee (in its capacity as Trustee) against any and all losses,
claims, damages, penalties, fines, liabilities or expenses, including incidental
and out-of-pocket expenses and reasonable attorneys fees (for purposes of this
Article 7, "LOSSES") incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against the Company (including
this Section 7.07) and defending itself against any claim (whether asserted by
the Company or any Holder or any other Person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent such losses may be attributable to its negligence or bad faith. The
Trustee shall notify the Company promptly of any claim for which it may seek
indemnity. Failure by the Trustee to so notify the Company shall not relieve the
Company of its obligations hereunder. The Company shall defend the claim, and
the Trustee shall cooperate in the defense. The Trustee may have separate
counsel if the Trustee has been reasonably advised by counsel that there may be
one or more legal defenses available to it that are different from or additional
to those available to the Company and in the reasonable judgment of such counsel
it is advisable for the Trustee to engage separate counsel, and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need not
pay for any settlement made without its consent, which consent shall not be
unreasonably withheld. The Company need not reimburse any expense or indemnify
against any loss incurred by the Trustee through the Trustee's own negligence or
bad faith.

         The obligations of the Company under this Section 7.07 shall survive
the satisfaction and discharge of this Indenture, the resignation or removal of
the Trustee and payment in full of the Notes.

         To secure the Company's payment obligations in this Section, the
Trustee shall have a Lien prior to the Notes on all money or property held or
collected by the Trustee, except that held in trust to pay principal, premium,
if any, and interest on particular Notes. Such Lien shall survive the
satisfaction and discharge of this Indenture.

         When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(viii) or (ix) hereof occurs, the expenses and
the compensation for the services (including the fees and expenses of its agents
and counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.

SECTION 7.08.     REPLACEMENT OF TRUSTEE.

         A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.

         The Trustee may resign in writing at any time upon 30 days' prior
notice to the Company and be discharged from the trust hereby created by so
notifying the Company. The Holders of a majority in principal amount of the then
outstanding Notes may remove the Trustee by so notifying the Trustee and the
Company in writing. The Company may remove the Trustee if:

         (a) the Trustee fails to comply with Section 7.10 hereof;

                                       66


         (b) the Trustee is adjudged bankrupt or insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;

         (c) a custodian or public officer takes charge of the Trustee or its
property; or

         (d) the Trustee becomes incapable of acting.

         If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.

         If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, or
the Holders of at least 10% in principal amount of the then outstanding Notes
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.

         If the Trustee, after written request by any Holder who has been a
Holder for at least six months, fails to comply with Section 7.10 hereof, such
Holder may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.

         A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. Subject to the Lien provided for in Section 7.07 hereof,
the retiring Trustee shall promptly transfer all property held by it as Trustee
to the successor Trustee PROVIDED, HOWEVER; that all sums owing to the Trustee
hereunder shall have been paid. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations under Section 7.07
hereof shall continue for the benefit of the retiring Trustee.

SECTION 7.09.     SUCCESSOR TRUSTEE BY MERGER, ETC.

         If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation or
banking association, the successor corporation or banking association without
any further act shall, if such successor corporation or banking association is
otherwise eligible hereunder, be the successor Trustee.

SECTION 7.10.     ELIGIBILITY; DISQUALIFICATION.

         There shall at all times be a Trustee hereunder that is a Person
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least US$50.0
million (or a wholly-owned subsidiary of a bank or trust company, or of a bank
holding company, the principal subsidiary of which is a bank or trust company
having a combined capital and surplus of at least US$50.0 million) as set forth
in its most recent published annual report of condition.

         This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1), (2) and (5). The Trustee is subject to
TIA Section 310(b).

SECTION 7.11.     PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.

         The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.

                                       67


                                   ARTICLE 8.

                    LEGAL DEFEASANCE AND COVENANT DEFEASANCE

SECTION 8.01.     OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.

         The Company may, at its option and at any time, elect to have either
Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance
with the conditions set forth in this Article 8.

SECTION 8.02.     LEGAL DEFEASANCE AND DISCHARGE.

         Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.02, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "LEGAL
DEFEASANCE") and each Subsidiary Guarantor shall be released from all of its
obligations under its Subsidiary Guarantee. For this purpose, Legal Defeasance
means that the Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes, which shall thereafter be
deemed to be "outstanding" only for the purposes of Section 8.05 hereof and the
other Sections of this Indenture referred to in (a), (b) and (d) below, and to
have satisfied all its other obligations under the Notes and this Indenture (and
the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging the same), except for the following provisions
which shall survive until otherwise terminated or discharged hereunder: (a) the
rights of Holders of outstanding Notes to receive solely from the trust fund
described in Section 8.04 hereof, and as more fully set forth in such Section,
payments in respect of the principal of, premium, if any, or interest and
Additional Amounts on such Notes when such payments are due, (b) the Company's
obligations with respect to such Notes under Article 2 and Sections 4.01 and
4.02 hereof, (c) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and the Company's obligations in connection therewith and (d)
this Article 8. If the Company exercises under Section 8.01 hereof the option
applicable to this Section 8.02, subject to the satisfaction of the conditions
set forth in Section 8.04 hereof, payment of the Notes may not be accelerated
because of an Event of Default. Subject to compliance with this Article 8, the
Company may exercise its option under this Section 8.02 notwithstanding the
prior exercise of its option under Section 8.03 hereof.

SECTION 8.03.     COVENANT DEFEASANCE.

         Upon the Company's exercise under Section 8.01 hereof of the option
applicable to this Section 8.03, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Sections 4.05 and 4.06 and 4.09
through 4.19 hereof, and the operation of Sections 5.01(a)(4) and (b)(4) hereof,
with respect to the outstanding Notes on and after the date the conditions set
forth in Section 8.04 hereof are satisfied (hereinafter, "COVENANT DEFEASANCE")
and each Subsidiary Guarantor shall be released from all of its obligations
under its Subsidiary Guarantee with respect to such covenants in connection with
such outstanding Notes and the Notes shall thereafter be deemed not
"outstanding" for the purposes of any direction, waiver, consent or declaration
or act of Holders (and the consequences of any thereof) in connection with such
covenants, but shall continue to be deemed "outstanding" for all other purposes
hereunder (it being understood that such Notes shall not be deemed outstanding
for accounting purposes). For this purpose, Covenant Defeasance means that, with
respect to the outstanding Notes, the Company may omit to comply with and shall
have no liability in respect of any term, condition or limitation set forth in
any such covenant, whether directly or indirectly, by reason of any reference
elsewhere herein to any such covenant or by reason of any reference in any such
covenant to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of Default under
Section 6.01 hereof, but, except as specified above, the remainder of this
Indenture and such Notes shall be unaffected thereby. If the Company exercises
under Section 8.01 hereof the option applicable to this Section 8.03, subject to
the satisfaction of the conditions set forth in Section 8.04 hereof, payment of
the Notes may not be accelerated because of an Event of Default specified in
clause (iii) (with respect to the covenants contained in Sections 4.09, 4.10,
4.12 or 4.18 or Section 5.01(a)(4) or (b)(4) hereof), (iv) (with respect to
Sections 4.05, 4.06, 4.11, 4.13 through 4.17, and 4.19 hereof), (v), (vi),
(vii), (viii) and (ix) of such Section 6.01 (but in the case of (viii) and (ix)
of Section 6.01 hereof, with respect to Significant Subsidiaries only) or
because of the Company's failure to comply with Section 5.01(a)(4) or (b)(4)
hereof.

                                       68


SECTION 8.04.     CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.

         The following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes.

         In order to exercise Legal Defeasance or Covenant Defeasance:

         (a) the Company shall irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders cash in U.S. dollars, non-callable Government
Securities, or a combination thereof, in such amounts as will be sufficient, in
the opinion of a nationally recognized firm of independent public accountants,
to pay the principal of, or interest and premium, if any, on the outstanding
notes on the Stated Maturity or on the applicable date of redemption, as the
case may be, and the Company shall specify whether the Notes are being defeased
to maturity or to a particular date of redemption;

         (b) in the case of Legal Defeasance, the Company shall deliver to the
Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming
that (i) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling or (ii) subsequent to the Issue Date, there
has been a change in the applicable federal income tax law, in either case to
the effect that, and based thereon such Opinion of Counsel shall confirm that,
the Holders of the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance had not occurred
and the Company shall have delivered to the Trustee an Opinion of Counsel in
Canada reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes will not recognize income, gain or loss for Canadian federal,
provincial or territorial income tax purposes as a result of such Legal
Defeasance and will be subject to Canadian federal, provincial or territorial
income tax (including withholding tax) on the same amounts, in the same manner
and at the same times as would have been the case if such Legal Defeasance had
not occurred;

         (c) in the case of Covenant Defeasance, the Company shall deliver to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that Holders of the outstanding Notes will not recognize income, gain
or loss for federal income tax purposes as a result of such Covenant Defeasance
and will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred and the Company shall have delivered to the Trustee
an Opinion of Counsel in Canada reasonably acceptable to the Trustee confirming
that Holders of the outstanding Notes will not recognize income, gain or loss
for Canadian federal, provincial or territorial income tax purposes as a result
of such Covenant Defeasance and will be subject to Canadian federal, provincial
or territorial income tax (including withholding tax) on the same amounts, in
the same manner and at the same time as would have been the case if such
Covenant Defeasance had not occurred;

         (d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit, other than a Default or Event of Default
resulting from the borrowing of funds to be applied to such deposit;

         (e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under any material agreement or
instrument, other than this Indenture, to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;

         (f) the Company shall deliver to the Trustee an Opinion of Counsel to
the effect that, assuming no intervening bankruptcy of the Company between the
date of deposit and the 91st day following such deposit and assuming that no
Holder is an "insider" of the Company under applicable Bankruptcy Law, after the
91st day following such deposit, the trust funds will not be subject to the
effect of any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally;

         (g) the Company shall deliver to the Trustee an Officers' Certificate
stating that such deposit was not made by the Company with the intent of
preferring the Holders of Notes over the other creditors of the Company with the
intent of defeating, hindering, delaying or defrauding creditors of the Company
or others; and

                                       69


         (h) the Company shall deliver to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent relating
to the Legal Defeasance or the Covenant Defeasance have been complied with.

SECTION 8.05.     DEPOSITED CASH AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
                  OTHER MISCELLANEOUS PROVISIONS.

         Subject to Section 8.06 hereof, all cash and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
"TRUSTEE") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of all sums due and to become due thereon
in respect of principal, premium, if any, and interest but such cash and
securities need not be segregated from other funds except to the extent required
by law.

         The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.

         Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any cash or non-callable Government Securities held by it as provided in
Section 8.04 hereof which, in the opinion of a nationally recognized firm of
independent certified public accountants of recognized international standing
expressed in a written certification thereof delivered to the Trustee (which may
be the certification delivered under Section 8.04(a) hereof), are in excess of
the amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.

SECTION 8.06.     REPAYMENT TO COMPANY.

         Any cash or non-callable Government Securities deposited with the
Trustee or any Paying Agent, or then held by the Company, in trust for the
payment of the principal, premium, if any, or interest on any Note and remaining
unclaimed for two years after such principal, premium, if any, or interest has
become due and payable shall be paid to the Company on its request or (if then
held by the Company) shall be discharged from such trust; and the Holder shall
thereafter, as an unsecured creditor, look only to the Company for payment
thereof, and all liability of the Trustee or such Paying Agent with respect to
such cash and securities, and all liability of the Company as trustee thereof,
shall thereupon cease; PROVIDED, HOWEVER, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in THE NEW YORK TIMES and THE WALL STREET
JOURNAL (national edition), notice that such cash and securities remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such notification or publication, any unclaimed balance
of such cash and securities then remaining shall be repaid to the Company.

SECTION 8.07.     REINSTATEMENT.

         If the Trustee or Paying Agent is unable to apply any cash or
non-callable Government Securities in accordance with Section 8.02 or 8.03
hereof, as the case may be, by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such cash and securities in accordance with Section 8.02
or 8.03 hereof, as the case may be; PROVIDED, HOWEVER, that, if the Company
makes any payment of principal of, premium, if any, or interest on any Note
following the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders to receive such payment from the cash and
securities held by the Trustee or Paying Agent.

                                       70


                                   ARTICLE 9.

                        AMENDMENT, SUPPLEMENT AND WAIVER

SECTION 9.01.     WITHOUT CONSENT OF HOLDERS OF NOTES.

         Notwithstanding Section 9.02 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Notes without the consent
of any Holder to:

         (a) cure any ambiguity, defect or inconsistency;

         (b) provide for uncertificated Notes in addition to or in place of
certificated Notes (PROVIDED that the uncertificated Notes are issued in
registered form for purposes of Section 163(f) of the Code, or in a manner such
that the uncertificated Notes are described in Section 163(f)(2)(B) of the
Code);

         (c) provide for the assumption of the obligations of the Company and/or
a Subsidiary Guarantor to Holders in the case of a merger, consolidation, or
amalgamation or sale of all or substantially all of the assets of the Company
and/or a Subsidiary Guarantor; PROVIDED, HOWEVER, that the Company shall deliver
to the Trustee:

             (i) an Opinion of Counsel to the effect that Holders will not
     recognize income, gain or loss for U.S. Federal income tax purposes as a
     result of such assumption by a successor corporation and will be subject to
     U.S. federal income tax on the same amount and in the same manner and at
     the same times as would have been the case if such assumption had not
     occurred, and

             (ii) an Opinion of Counsel in Canada to the effect that Holders
     will not recognize income, gain or loss for Canadian federal, provincial or
     territorial tax purposes as a result of such assumption by a successor
     corporation and will be subject to Canadian federal, provincial or
     territorial taxes (including withholding taxes) on the same amounts, in the
     same manner and at the same times as would have been the case if such
     assumption had not occurred;

         (d) make any change that would provide any additional rights or
benefits to the Holders or that does not adversely affect the legal rights under
this Indenture of any such Holder;

         (e) add additional Guarantees with respect to the Notes or release
Subsidiary Guarantors from Subsidiary Guarantees as provided or permitted by the
terms of this Indenture;

         (f) provide for the issuance of Additional Notes in accordance with
this Indenture; or

         (g) comply with requirements of the SEC in order to effect or maintain
the qualification of this Indenture under the TIA.

SECTION 9.02.     WITH CONSENT OF HOLDERS OF NOTES.

         Except as provided below in this Section 9.02, the Company and the
Trustee may amend or supplement this Indenture and the Notes with the consent of
the Holders of at least a majority in principal amount of the Notes, including
Additional Notes, if any, then outstanding voting as a single class (including
consents obtained in connection with a purchase of or tender offer or exchange
offer for the Notes), and, subject to Sections 6.04 and 6.07 hereof, any
existing Default or Event of Default (except a continuing Default or Event of
Default (i) in the payment of principal, premium, if any, or interest on the
Notes and (ii) in respect of a covenant or provision which under this Indenture
cannot be modified or amended without the consent of the Holder of each Note
affected by such modification or amendment) or compliance with any provision of
this Indenture or the Notes may be waived with the consent of the Holders of at
least a majority in principal amount of the Notes, including Additional Notes,
if any, then outstanding voting as a single class (including consents obtained
in connection with a purchase of or tender offer or exchange offer for the
Notes).

                                       71


         Without the consent of each Holder, an amendment or waiver under this
Section 9.02 may not (with respect to any Notes held by a non-consenting
Holder):

         (a) reduce the principal amount of Notes whose Holders must consent to
an amendment, supplement or waiver;

         (b) reduce the principal of or change the Stated Maturity of any Note
or alter the provisions with respect to the redemption of the Notes, other than
provisions under Sections 4.12 and 4.18 hereof;

         (c) reduce the rate of or change the time for payment of interest on
any Note;

         (d) waive a Default or Event of Default in the payment of principal of,
or interest or premium, if any, on the Notes, except a rescission of
acceleration of the Notes by the Holders of at least a majority in aggregate
principal amount of the Notes and a waiver of the payment default that resulted
from such acceleration;

         (e) make any Note payable in money other than that stated in the Notes;

         (f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Notes to receive payments
of principal of, or interest or premium, if any, on the Notes, or to the
institute suit for the enforcement of any payment on or with respect to such
Holders' Notes or any Subsidiary Guarantee;

         (g) waive a redemption payment with respect to any Note, other than a
payment required by the provisions of Section 4.12 or 4.18 hereof;

         (h) subordinate the Notes or any Subsidiary Guarantee to any other
obligation of Sun Media or the applicable Subsidiary Guarantor;

         (i) amend or modify the provisions of Section 4.20 hereof;

         (j) amend or modify any Subsidiary Guarantee in a manner that would
adversely affect the Holders of the Notes; or

         (k) make any change in the preceding amendment and waiver provisions.

         The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Persons entitled to consent to any supplemental
indenture. If a record date is fixed, the Holders on such record date, or their
duly designated proxies, and only such Persons, shall be entitled to consent to
such supplemental indenture, whether or not such Holders remain Holders after
such record date; PROVIDED that unless such consent shall have become effective
by virtue of the requisite percentage having been obtained prior to the date
which is 120 days after such record date, any such consent previously given
shall automatically and without further action by any Holder be cancelled and of
no further effect.

         It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment or waiver,
but it shall be sufficient if such consent approves the substance thereof.

         After an amendment, supplement or waiver under this Section 9.02
becomes effective, the Company shall mail to the Holder of each Note affected
thereby to such Holder's address appearing in the Security Register a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amended or supplemental indenture
or waiver.

                                       72


SECTION 9.03.     COMPLIANCE WITH TRUST INDENTURE ACT.

         Every amendment or supplement to this Indenture or the Notes shall be
set forth in an amended or supplemental indenture that complies with the TIA as
then in effect.

SECTION 9.04.     REVOCATION AND EFFECT OF CONSENTS.

         Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion thereof that evidences the same debt as
the consenting Holder's Note, even if notation of the consent is not made on any
Note. However, any such Holder or subsequent Holder may revoke the consent as to
its Note or portion thereof if the Trustee receives written notice of revocation
before the date the waiver, supplement or amendment becomes effective. An
amendment, supplement or waiver shall become effective in accordance with its
terms and thereafter shall bind every Holder.

SECTION 9.05.     NOTATION ON OR EXCHANGE OF NOTES.

         The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall, upon receipt of an
Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.

         Failure to make the appropriate notation or issue a new Note shall not
affect the validity and effect of such amendment, supplement or waiver.

SECTION 9.06.     TRUSTEE TO SIGN AMENDMENTS, ETC.

         The Trustee shall sign any amended or supplemental indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully
protected in relying upon an Officers' Certificate and an Opinion of Counsel
stating that the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture and that such amended or supplemental
indenture is the legal, valid and binding obligations of the Company enforceable
against it in accordance with its terms, subject to customary exceptions and
that such amended or supplemental indenture complies with the provisions hereof
(including Section 9.03 hereof).

                                  ARTICLE 10.

                             SUBSIDIARY GUARANTEES

SECTION 10.01.    GUARANTEE.

         Subject to this Article 10, each of the Subsidiary Guarantors hereby
unconditionally guarantees to each Holder of a Note authenticated and delivered
by the Trustee and to the Trustee and its successors and assigns (a) the due and
punctual payment of the principal of, premium, if any, and interest on the
Notes, subject to any applicable grace period, whether at maturity, by
acceleration, redemption or otherwise, the due and punctual payment of interest
on the overdue principal and premium, if any, and to the extent permitted by
law, interest, and the due and punctual performance of all other obligations of
the Company to the Holders or the Trustee hereunder or thereunder, all in
accordance with the terms hereof and thereof; and (b) in case of any extension
of time of payment or renewal of any Notes or any of such other obligations,
that same shall be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at maturity, by acceleration
pursuant to Section 6.02 hereof, redemption or otherwise. Failing payment when
due of any amount so guaranteed or any performance so guaranteed for whatever
reason, the Subsidiary Guarantors shall be jointly and severally obligated to
pay the same immediately. Each Subsidiary Guarantor agrees that this is a
guarantee of payment and not a guarantee of collection.

                                       73


         Each Subsidiary Guarantor hereby agrees that its obligations with
regard to its Subsidiary Guarantee shall be joint and several, unconditional,
irrespective of the validity or enforceability of the Notes or the obligations
of the Company under this Indenture, the absence of any action to enforce the
same, the recovery of any judgment against the Company or any other obligor with
respect to this Indenture, the Notes or the Obligations of the Company under
this Indenture or the Notes, any action to enforce the same or any other
circumstances (other than complete performance) which might otherwise constitute
a legal or equitable discharge or defense of a Subsidiary Guarantor. Each
Subsidiary Guarantor further, to the extent permitted by law, waives and
relinquishes all claims, rights and remedies accorded by applicable law to
guarantors and agrees not to assert or take advantage of any such claims, rights
or remedies, including but not limited to: (a) any right to require any of the
Trustee, the Holders or the Company (each a "BENEFITED PARTY"), as a condition
of payment or performance by such Subsidiary Guarantor, to (1) proceed against
the Company, any other guarantor (including any other Subsidiary Guarantor) of
the Obligations under the Guarantees or any other Person, (2) proceed against or
exhaust any security held from the Company, any such other guarantor or any
other Person, (3) proceed against or have resort to any balance of any deposit
account or credit on the books of any Benefited Party in favor of the Company or
any other Person, or (4) pursue any other remedy in the power of any Benefited
Party whatsoever; (b) any defense arising by reason of the incapacity, lack of
authority or any disability or other defense of the Company including any
defense based on or arising out of the lack of validity or the unenforceability
of the Obligations under the Subsidiary Guarantees or any agreement or
instrument relating thereto or by reason of the cessation of the liability of
the Company from any cause other than payment in full of the Obligations under
the Subsidiary Guarantees; (c) any defense based upon any statute or rule of law
which provides that the obligation of a surety must be neither larger in amount
nor in other respects more burdensome than that of the principal; (d) any
defense based upon any Benefited Party's errors or omissions in the
administration of the Obligations under the Subsidiary Guarantees, except
behavior which amounts to bad faith; (e)(1) any principles or provisions of law,
statutory or otherwise, which are or might be in conflict with the terms of the
Subsidiary Guarantees and any legal or equitable discharge of such Subsidiary
Guarantor's obligations hereunder, (2) the benefit of any statute of limitations
affecting such Subsidiary Guarantor's liability hereunder or the enforcement
hereof, (3) any rights to set-offs, recoupments and counterclaims and (4)
promptness, diligence and any requirement that any Benefited Party protect,
secure, perfect or insure any security interest or lien or any property subject
thereto; (f) notices, demands, presentations, protests, notices of protest,
notices of dishonor and notices of any action or inaction, including acceptance
of the Subsidiary Guarantees, notices of default under the Notes or any
agreement or instrument related thereto, notices of any renewal, extension or
modification of the Obligations under the Subsidiary Guarantees or any agreement
related thereto, and notices of any extension of credit to the Company and any
right to consent to any thereof; (g) to the extent permitted under applicable
law, the benefits of any "One Action" rule and (h) any defenses or benefits that
may be derived from or afforded by law which limit the liability of or exonerate
guarantors or sureties, or which may conflict with the terms of the Subsidiary
Guarantees. Except to the extent expressly provided herein, including Sections
8.02, 8.03 and 10.05 hereof, each Subsidiary Guarantor hereby covenants that its
Subsidiary Guarantee shall not be discharged except by complete performance of
the obligations contained in its Subsidiary Guarantee and this Indenture.

         If any Holder or the Trustee is required by any court or otherwise to
return to the Company, the Subsidiary Guarantors or any custodian, trustee,
liquidator or other similar official acting in relation to either the Company or
the Subsidiary Guarantors, any amount paid by either to the Trustee or such
Holder, this Subsidiary Guarantee, to the extent theretofore discharged, shall
be reinstated in full force and effect.

         Each Subsidiary Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any obligations
guaranteed hereby until payment in full of all obligations guaranteed hereby.
Each Subsidiary Guarantor further agrees that, as between the Subsidiary
Guarantors, on the one hand, and the Holders and the Trustee, on the other hand,
(x) the maturity of the obligations guaranteed hereby may be accelerated as
provided in Section 6.02 hereof for the purposes of this Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby and (y) in the
event of any declaration of acceleration of such obligations as provided in
Section 6.02 hereof, such obligations (whether or not due and payable) shall
forthwith become due and payable by the Guarantors for the purpose of this
Subsidiary Guarantee. The Subsidiary Guarantors shall have the right to seek
contribution from any non-paying Subsidiary Guarantor so long as the exercise of
such right does not impair the rights of the Holders under the Subsidiary
Guarantee.

                                       74


SECTION 10.02.    LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY.

         Each Subsidiary Guarantor, and by its acceptance of Notes, each Holder,
hereby confirms that it is the intention of all such parties that the Subsidiary
Guarantee of such Subsidiary Guarantor not constitute a fraudulent transfer or
conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to
the extent applicable to any Subsidiary Guarantee. To effectuate the foregoing
intention, the Trustee, the Holders and the Subsidiary Guarantors hereby
irrevocably agree that the obligations of such Subsidiary Guarantor under this
Article 10 shall be limited to the maximum amount as shall, after giving effect
to such maximum amount and all other contingent and fixed liabilities of such
Subsidiary Guarantor that are relevant under such laws, including, if
applicable, its guarantee of all obligations under the New Credit Facility, and
after giving effect to any collections from, rights to receive contribution from
or payments made by or on behalf of any other Subsidiary Guarantor in respect of
the obligations of such other Subsidiary Guarantor under this Article 10, result
in the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee
not constituting a fraudulent transfer or conveyance.

SECTION 10.03.    EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE.

         To evidence its Subsidiary Guarantee set forth in Section 10.01 hereof,
each Subsidiary Guarantor hereby agrees that a notation of such Subsidiary
Guarantee in substantially the form included in Exhibit E attached hereto shall
be endorsed by an Officer of such Subsidiary Guarantor on each Note
authenticated and delivered by the Trustee and that this Indenture shall be
executed on behalf of such Subsidiary Guarantor by its President or one of its
Vice Presidents.

         Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee
set forth in Section 10.01 hereof shall remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such
Subsidiary Guarantee.

         If an Officer whose signature is on this Indenture or on the Subsidiary
Guarantee no longer holds that office at the time the Trustee authenticates the
Note on which a Subsidiary Guarantee is endorsed, the Subsidiary Guarantee shall
be valid nevertheless.

         The delivery of any Note by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set
forth in this Indenture on behalf of the Subsidiary Guarantors.

SECTION 10.04.    SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.

         Except as otherwise provided in Section 10.05 hereof, no Subsidiary
Guarantor may consolidate with or merge with or into (whether or not such
Subsidiary Guarantor is the Surviving Guarantor) another Person whether or not
affiliated with such Subsidiary Guarantor unless:

         (a) subject to Section 10.05 hereof, the Person formed by or surviving
any such consolidation or merger (if other than a Subsidiary Guarantor or the
Company) unconditionally assumes all the obligations of such Subsidiary
Guarantor, pursuant to a supplemental indenture in form and substance reasonably
satisfactory to the Trustee, under this Indenture, the Subsidiary Guarantee and
any Registration Rights Agreements on the terms set forth herein or therein; and

         (b) the Subsidiary Guarantor complies with the requirements of Article
5 hereof.

         In case of any such consolidation, merger, sale or conveyance and upon
the assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Subsidiary Guarantor, such successor Person shall succeed to
and be substituted for the Subsidiary Guarantor with the same effect as if it
had been named herein as a Subsidiary Guarantor. Such successor Person thereupon
may cause to be signed any or all of the Subsidiary Guarantees to be endorsed
upon all of the Notes issuable hereunder which theretofore shall not have been
signed by

                                       75



the Company and delivered to the Trustee. All the Subsidiary Guarantees so
issued shall in all respects have the same legal rank and benefit under this
Indenture as the Subsidiary Guarantees theretofore and thereafter issued in
accordance with the terms of this Indenture as though all of such Subsidiary
Guarantees had been issued at the date of the execution hereof.

         Except as set forth in Articles 4 and 5 hereof, and notwithstanding
clauses (a) and (b) above, nothing contained in this Indenture or in any of the
Notes shall prevent any consolidation or merger of a Subsidiary Guarantor with
or into the Company or another Subsidiary Guarantor, or shall prevent any sale
or conveyance of the property of a Subsidiary Guarantor as an entirety or
substantially as an entirety to the Company or another Subsidiary Guarantor.

SECTION 10.05.    RELEASES FOLLOWING SALE OF ASSETS.

         In the event of a sale or other disposition of all or substantially all
of the assets of any Subsidiary Guarantor, by way of merger, consolidation or
otherwise, or a sale or other disposition of all of the Capital Stock of any
Subsidiary Guarantor, in each case to a Person that is not (either before or
after giving effect to such transactions) a Subsidiary of the Company, then such
Subsidiary Guarantor (in the event of a sale or other disposition, by way of
merger, consolidation or otherwise, of all of the Capital Stock of such
Subsidiary Guarantor) or the corporation acquiring the property (in the event of
a sale or other disposition of all or substantially all of the assets of such
Subsidiary Guarantor) shall be released and relieved of any obligations under
its Subsidiary Guarantee; PROVIDED that the net proceeds of such sale or other
disposition shall be subject to all applicable provisions of this Indenture,
including without limitation Section 4.12 hereof. If a Restricted Subsidiary is
designated as an Unrestricted Subsidiary in accordance with the provisions of
Section 4.17 hereof, such Subsidiary shall be released and relieved of any
obligations under its Subsidiary Guarantee. Upon delivery by the Company to the
Trustee of an Officers' Certificate and an Opinion of Counsel to the effect that
such sale or other disposition or designation was made by the Company in
accordance with the provisions of this Indenture, including without limitation
Section 4.12 hereof, the Trustee shall execute any documents reasonably required
in order to evidence the release of any Subsidiary Guarantor from its
obligations under its Subsidiary Guarantee.

         Any Subsidiary Guarantor not released from its obligations under its
Subsidiary Guarantee shall remain liable for the full amount of principal of and
interest on the Notes and for the other obligations of any Subsidiary Guarantor
under this Indenture.

                                  ARTICLE 11.

                          SATISFACTION AND DISCHARGE

SECTION 11.01.    SATISFACTION AND DISCHARGE.

         This Indenture shall be discharged and shall cease to be of further
effect, except as to surviving rights of registration of transfer or exchange of
the Notes, as to all Notes issued hereunder, when:

         (a) either:

             (i) all Notes that have been previously authenticated (except lost,
     stolen or destroyed Notes that have been replaced or paid and Notes for
     whose payment money has previously been deposited in trust or segregated
     and held in trust by the Company and is thereafter repaid to the Company or
     discharged from the trust) have been delivered to the Trustee for
     cancellation; or

             (ii) all Notes that have not been previously delivered to the
     Trustee for cancellation (A) have become due and payable by reason of a
     making of a notice of redemption or otherwise or (B) will become due and
     payable within one year, and the Company has irrevocably deposited or
     caused to be deposited with the Trustee as trust funds in trust solely for
     the benefit of the Holders, cash in U.S. dollars, non-callable Government
     Securities, or a combination thereof, in such amounts as will be sufficient
     without consideration of any reinvestment of interest, to pay and discharge
     the entire Indebtedness on the Notes not

                                       76



     previously delivered to the Trustee for cancellation for principal,
     premium, if any, and interest on the Notes to the date of deposit, in the
     case of Notes that have become due and payable, or to the Stated Maturity
     or redemption date, as the case may be;

         (b) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or shall occur as a result of such
deposit and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Company is a party
or by which the Company is bound;

         (c) the Company has paid or caused to be paid all other sums payable by
it under this Indenture;

         (d) the Company shall have delivered irrevocable instructions to the
Trustee to apply the deposited money toward the payment of the Notes at maturity
or the date of redemption, as the case may be; and

         (e) the Company shall have delivered to the Trustee an Officers'
Certificate and Opinion of Counsel stating that all conditions precedent under
this Indenture relating to the satisfaction and discharge of this Indenture have
been satisfied.

SECTION 11.02.    DEPOSITED CASH AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
                  OTHER MISCELLANEOUS PROVISIONS.

         Subject to Section 11.03 hereof, all cash and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 11.02, the
"TRUSTEE") pursuant to Section 11.01 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest but
such cash and securities need not be segregated from other funds except to the
extent required by law.

SECTION 11.03.    REPAYMENT TO COMPANY.

         Any cash or non-callable Government Securities deposited with the
Trustee or any Paying Agent, or then held by the Company, in trust for the
payment of the principal of, premium, if any, or interest on, any Note and
remaining unclaimed for two years after such principal, and premium, if any, or
interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company) shall be discharged from such trust; and the
Holder shall thereafter, as an unsecured creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such cash and securities, and all liability of the Company as trustee
thereof, shall thereupon cease; PROVIDED, HOWEVER, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in THE NEW YORK TIMES and THE
WALL STREET JOURNAL (national edition), notice that such cash and securities
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such cash and securities then remaining shall be repaid to
the Company.

                                  ARTICLE 12.

                                 MISCELLANEOUS

SECTION 12.01.    TRUST INDENTURE ACT CONTROLS.

         If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA,
the provision required by the TIA shall control.

                                       77


SECTION 12.02.    NOTICES.

         Any notice or communication by the Company and/or a Subsidiary
Guarantor or the Trustee to the other is duly given if in writing and delivered
in person or mailed by first class mail (registered or certified, return receipt
requested), facsimile transmission or overnight air courier guaranteeing
next-day delivery, to the other's address:

                  If to the Company or a Subsidiary Guarantor:

                  Sun Media Corporation
                  333 King Street East
                  Toronto, Ontario, M5A 3X5
                  Canada
                  Attention:  Vice President, Corporate Controller
                  Facsimile No.:  (416) 947-3119

                  With a copy to:

                  Quebecor Media Inc.
                  300 Viger Avenue East
                  Montreal, Quebec H2X 3W4
                  Canada
                  Attention:  Vice President and Treasurer
                  Facsimile No.:  (514) 380-1983

                  And a copy to:

                  Arnold & Porter
                  399 Park Avenue
                  New York, New York  10022-4690
                  Attention: John A. Willett, Esq.
                  Facsimile No.:  (212) 715-1399

                  If to the Trustee:

                  National City Bank
                  Corporate Trust Department, Locator 01-3116
                  629 Euclid Avenue
                  Cleveland, Ohio 44114-3484
                  Attention:  Holly H. Pattison
                  Facsimile No.:  (216) 222-9326

         The Company or the Trustee, by notice to the other, may designate
additional or different addresses for subsequent notices or communications.

         All notices and communications (other than those sent to the Trustee)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when receipt acknowledged, if sent by facsimile
transmission; and the next Business Day after timely delivery to the courier, if
sent by overnight air courier guaranteeing next-day delivery. All notices and
communications to the Trustee shall be deemed duly given and effective only upon
receipt.

         Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guaranteeing next-day delivery to its address shown on the Security
Register. Any notice or communication shall also be so mailed to any Person
described in TIA Section 313(c), to the extent required by the TIA. Failure to
mail a notice or communication to a Holder or any defect in it shall not affect
its sufficiency with respect to other Holders.

                                       78


         If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.

         If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.

SECTION 12.03.    COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.

         Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA Section 312(c).

SECTION 12.04.    CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

         Upon any request or application by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee:

         (a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been complied with; and

         (b) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 12.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been complied with.

SECTION 12.05.    STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

         Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA Section 314(a)(4)) shall comply with the provisions of TIA
Section 314(e) and shall include:

         (a) a statement that the Person making such certificate or opinion has
read such covenant or condition;

         (b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;

         (c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable such Person to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and

         (d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.

With respect to matters of fact, an Opinion of Counsel may rely on an Officers'
Certificate, certificates of public officials or reports or opinions of experts.

SECTION 12.06.    RULES BY TRUSTEE AND AGENTS.

         The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.

                                       79


SECTION 12.07.    NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
                  SHAREHOLDERS.

         No past, present or future director, officer, employee, incorporator or
stockholder of the Company or any Guarantor, as such, shall have any liability
for any obligations of the Company or of the Guarantors under the Notes, this
Indenture, the Guarantees or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder of Notes by accepting a Note
waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the Notes.

SECTION 12.08.    GOVERNING LAW.

         THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO
CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

SECTION 12.09.    NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

         This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.

SECTION 12.10.    SUCCESSORS.

         All covenants and agreements of the Company in this Indenture and the
Notes shall bind its successors. All covenants and agreements of the Trustee in
this Indenture shall bind its successors.

SECTION 12.11.    SEVERABILITY.

         In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 12.12.    CONSENT TO JURISDICTION AND SERVICE OF PROCESS

         (a) Each of the Company and each of the Subsidiary Guarantors
irrevocably consents to the non-exclusive jurisdiction of the courts of the
State of New York and the courts of the United States of America located in the
Borough of Manhattan, City and State of New York over any suit, action or
proceeding with respect to this Indenture or the transactions contemplated
hereby. Each of the Company and each of the Subsidiary Guarantors waives any
objection that it may have to the venue of any suit, action or proceeding with
respect to this Indenture or the transactions contemplated hereby in the courts
of the State of New York or the courts of the United States of America, in each
case, located in the Borough of Manhattan, City and State of New York, or that
such suit, action or proceeding brought in the courts of the State of New York
or the United States of America, in each case, located in the Borough of
Manhattan, City and State of New York was brought in an inconvenient court and
agrees not to plead or claim the same.

         (b) Each of the Company and each of the Subsidiary Guarantors
irrevocably appoints CT Corporation System, as its authorized agent in the State
of New York upon which process may be served in any such suit or proceedings,
and agrees that service of process upon such agent, and written notice of said
service to CT Corporation System, by the person serving the same to the address
provided in Section 12.02 hereof, shall be deemed in every respect effective
service of process upon the Company or any Subsidiary Guarantor in any such suit
or proceeding. Each of the Company and each of the Subsidiary Guarantors further
agrees to take any and all action as may be necessary to maintain such
designation and appointment of such agent in full force and effect for a period
of ten years from the date of this Indenture.

                                       80


SECTION 12.13.    CONVERSION OF CURRENCY.

         The Company covenants and agrees that the following provisions shall
apply to conversion of currency in the case of the Notes and this Indenture.

         (a) (i) If, for the purpose of obtaining judgment in, or enforcing the
     judgment of, any court in any country, it becomes necessary to convert into
     a currency (the "JUDGMENT CURRENCY") an amount due in any other currency
     (the "BASE CURRENCY"), then the conversion shall be made at the rate of
     exchange prevailing on the Business Day before the day on which the
     judgment is given or the order of enforcement is made, as the case may be
     (unless a court shall otherwise determine).

             (ii) If there is a change in the rate of exchange prevailing
     between the Business Day before the day on which the judgment is given or
     an order of enforcement is made, as the case may be (or such other date as
     a court shall determine), and the date of receipt of the amount due, the
     Company shall pay such additional (or, as the case may be, such lesser)
     amount, if any, as may be necessary so that the amount paid in the judgment
     currency when converted at the rate of exchange prevailing on the date of
     receipt will produce the amount in the Base Currency originally due.

         (b) In the event of the winding-up of the Company at any time while any
amount or damages owing under the Notes and this Indenture, or any judgment or
order rendered in respect thereof, shall remain outstanding, the Company shall
indemnify and hold the Holders and the Trustee harmless against any deficiency
arising or resulting from any variation in rates of exchange between (1) the
date as of which the equivalent of the amount in U.S. Dollars or Canadian
Dollars, as the case may be, due or contingently due under the Notes and this
Indenture (other than under this paragraph (b)) is calculated for the purposes
of such winding-up and (2) the final date for the filing of proofs of claim in
such winding-up. For the purpose of this paragraph (b), the final date for the
filing of proofs of claim in the winding-up of the Company shall be the date
fixed by the liquidator or otherwise in accordance with the relevant provisions
of applicable law as being the latest practicable date as at which liabilities
of the Company may be ascertained for such winding-up prior to payment by the
liquidator or otherwise in respect thereto.

         (c) The obligations contained in paragraph (a)(ii) and (b) of this
Section 12.13 shall constitute obligations of the Company separate and
independent from its other respective obligations under the Notes and this
Indenture, shall give rise to separate and independent causes of action against
the Company, shall apply irrespective of any waiver or extension granted by any
Holder or the Trustee or any of them from time to time and shall continue in
full force and effect notwithstanding any judgment or order or the filing of any
proof of claim in the winding-up of the Company for a liquidated sum in respect
of amounts due hereunder (other than under paragraph (b) above) or under any
such judgment or order. Any such deficiency as aforesaid shall be deemed to
constitute a loss suffered by the Holders or the Trustee, as the case may be,
and no proof or evidence of any actual loss shall be required by the Company or
the liquidator or otherwise or any of them. In the case of paragraph (b) above,
the amount of such deficiency shall not be deemed to be reduced by any variation
in rates of exchange occurring between the said final date and the date of any
liquidating distribution.

         (d) The term "rate(s) of exchange" shall mean the rate of exchange
quoted by Royal Bank of Canada at its central foreign exchange desk in its head
office in Toronto at 12:00 noon (Toronto, Ontario time) for purchases of the
Base Currency with the judgment currency other than the Base Currency referred
to in Subsections (a) and (b) above and includes any premiums and costs of
exchange payable.

         (e) The Trustee shall have no duty or liability with respect to
monitoring or enforcing the Section 12.13.

SECTION 12.14.    CURRENCY EQUIVALENT.

         Except as provided in Section 12.13, for purposes of the construction
of the terms of this Indenture or of the Notes, in the event that any amount is
stated herein in the currency of one nation (the "FIRST CURRENCY"), as of any
date such amount shall also be deemed to represent the amount in the currency of
any other relevant nation

                                       81


which is required to purchase such amount in the First Currency at the rate of
exchange quoted by Royal Bank of Canada at its central foreign exchange desk in
its head office in Toronto at 12:00 noon (Toronto, Ontario time) on the date of
determination.

SECTION 12.15.    COUNTERPART ORIGINALS

         The parties may sign any number of copies of this Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.

SECTION 12.16.    TABLE OF CONTENTS, HEADINGS, ETC.

         The Table of Contents, Cross-Reference Table and Headings in this
Indenture have been inserted for convenience of reference only, are not to be
considered a part of this Indenture and shall in no way modify or restrict any
of the terms or provisions hereof.

SECTION 12.17.    QUALIFICATION OF THIS INDENTURE.

         The Company shall qualify this Indenture under the TIA in accordance
with the terms and conditions of any Registration Rights Agreements and shall
pay all reasonable costs and expenses (including attorneys' fees and expenses
for the Company, the Trustee and the Holders) incurred in connection therewith,
including, but not limited to, costs and expenses of qualification of this
Indenture and the Notes and printing this Indenture and the Notes. The Trustee
shall be entitled to receive from the Company any such Officers' Certificates,
Opinions of Counsel or other documentation as it may reasonably request in
connection with any such qualification of this Indenture under the TIA.

                         [Signatures on following page]


                                       82



                                   SIGNATURES
Dated as of February 7, 2003.

                     COMPANY:

                     SUN MEDIA CORPORATION

                     By: /s/ KIN-MAN LEE
                        ----------------
                     Name:        Kin-Man Lee
                     Title:       Vice President, Corporate Controller



                     SUBSIDIARY GUARANTORS:

                     BOWES PUBLISHERS LIMITED

                     By: /s/ KIN-MAN LEE
                         ----------------
                         Name:        Kin-Man Lee
                         Title:       Vice President, Finance and Administration



                     SUN MEDIA (TORONTO) CORPORATION

                     By: /s/ KIN-MAN LEE
                         ----------------
                     Name:        Kin-Man Lee
                     Title:       Vice President, Corporate Controller



                     SMC NOMINEECO INC.

                     By: /s/ PIERRE FRANCOEUR
                         --------------------
                     Name:        Pierre Francoeur
                     Title:       President and Chief Executive Officer



                     TORONTO SUN INTERNATIONAL, INC.

                     By: /s/ KIN-MAN LEE
                         ----------------
                     Name:        Kin-Man Lee
                     Title:       Vice President, Corporate Controller



                     TS PRINTING, INC.

                     By: /s/ KIN-MAN LEE
                         ----------------
                     Name:        Kin-Man Lee
                     Title:       Vice President, Corporate Controller



                            INDENTURE SIGNATURE PAGE



                     FLORIDA SUN PUBLICATIONS, INC.

                     By: /s/ KIN-MAN LEE
                        ----------------
                     Name:        Kin-Man Lee
                     Title:       Vice President, Corporate Controller



                     3661458 CANADA INC.

                     By: /s/ KIN-MAN LEE
                        ----------------
                     Name:        Kin-Man Lee
                     Title:       Vice President, Corporate Controller



                     3351611 CANADA INC.

                     By: /s/ PIERRE FRANCOEUR
                        ---------------------
                     Name:        Pierre Francoeur
                     Title:       President



                            INDENTURE SIGNATURE PAGE




                     TRUSTEE:


                     NATIONAL CITY BANK


                     By: /s/ JAMES E. SCHULTZ
                        ---------------------
                     Name:        James E. Schultz
                     Title:       Vice President



                            INDENTURE SIGNATURE PAGE




                                                                       EXHIBIT A
================================================================================

                                 (Face of Note)

                          7-5/8% SENIOR NOTES DUE 2013



                                                            CUSIP  _____________

NO.___                                                        US$_______________


                              SUN MEDIA CORPORATION

promises to pay to CEDE & CO., INC. or its registered assigns, the principal sum
of _________________  Dollars  (US$______________)  on February 15, 2013.

Interest Payment Dates:  February 15 and August 15, commencing August 15, 2003.

Record Dates: February 1 and August 1.







                  IN WITNESS WHEREOF, the Company has caused this Note to be
signed by its duly authorized officer.

                                        SUN MEDIA CORPORATION


                                        By:
                                           ------------------------------
                                           Name:
                                           Title:




This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:

NATIONAL CITY BANK,
as Trustee

By:
   ----------------------------
    Authorized Signatory


Dated _____________, 2003


                                      A-1



                                 (Back of Note)

                          7-5/8% SENIOR NOTES DUE 2013

                  [THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY
STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.

                  THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL, ASSIGN, TRANSFER, PLEDGE, ENCUMBER OR OTHERWISE DISPOSE OF SUCH
SECURITY, PRIOR TO THE DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS
TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON
WHICH SUN MEDIA CORPORATION (THE "COMPANY") OR ANY OF ITS AFFILIATES WAS THE
OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE
COMPANY OR ANY OF ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT
THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS
THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE OF THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF US$250,000,
FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION OF THE SECURITIES IN VIOLATION OF THE
SECURITIES ACT OR (F) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY'S AND
THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE, ASSIGNMENT, TRANSFER, PLEDGE,
ENCUMBRANCE OR OTHER DISPOSITION PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE
THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.]

                  [THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY
BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
THE COMPANY.

                  UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES
IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) ("DTC"), TO THE

                                      A-2


COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY
BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

                  Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.

         1. INTEREST. Sun Media Corporation, a company continued under the
laws of British Columbia (the "COMPANY"), promises to pay interest (as
defined in the Indenture) on the principal amount of this Note at 7-5/8% per
annum until maturity and shall pay Special Interest, if any, as provided in
the Registration Rights Agreement relating to these Notes. The Company shall
pay interest semi-annually on February 15 and August 15 of each year, or if
any such day is not a Business Day, on the next succeeding Business Day (each
an "INTEREST PAYMENT DATE"). Interest on the Notes shall accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from the date of issuance; PROVIDED, HOWEVER, that if there is no existing
Default in the payment of interest, and if this Note is authenticated between
a record date referred to on the face hereof and the next succeeding Interest
Payment Date, interest shall accrue from such next succeeding Interest
Payment Date; PROVIDED, FURTHER, that the first Interest Payment Date shall
be August 15, 2003. The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time at a rate that is 1% per annum in excess
of the interest rate then in effect under the Indenture and this Note; it
shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue installments of interest (without regard to
any applicable grace periods), from time to time at the same rate to the
extent lawful. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months. For the purposes of the INTEREST ACT (Canada), the
yearly rate of interest which is equivalent to the rate payable hereunder is
the rate payable multiplied by the actual number of days in the year and
divided by 360.

         2. METHOD OF PAYMENT. The Company shall pay interest on the Notes
(except defaulted interest) to the Persons in whose name this Note (or one or
more Predecessor Notes) is registered at the close of business on the February 1
or August 1 next preceding the Interest Payment Date, even if such Notes are
cancelled after such record date and on or before such Interest Payment Date,
except as provided in Section 2.12 of the Indenture with respect to defaulted
interest. The Notes shall be payable as to principal, premium, if any, and
interest at the office or agency of the Company maintained for such purpose, or,
at the option of the Company, payment of interest may be made by check mailed to
the Holders at their addresses set forth in the Security Register; PROVIDED,
HOWEVER, that payment by wire transfer of immediately available funds shall be
required with respect to principal of and interest and premium, if any, on, all
Global Notes and all other Notes the Holders of which shall have provided wire
transfer instructions to the Company or the Paying Agent. Such payment shall be
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts.

         3. PAYING AGENT AND REGISTRAR. Initially, National City Bank, the
Trustee under the Indenture, shall act as Paying Agent and Registrar. The
Company may change any Paying Agent or Registrar without notice to any Holder.
The Company or any of its Subsidiaries may act in any such capacity.

         4. INDENTURE. The Company issued the Notes under an Indenture dated as
of February 7, 2003 ("Indenture") among the Company, the guarantors party
thereto (the "Subsidiary Guarantors") and the Trustee. The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code Sections
77aaa-77bbbb). The Notes are subject to all such terms, and Holders are referred
to the Indenture and such Act for a statement of such terms. To the extent any
provision of this Note conflicts with the express provisions of the Indenture,
the provisions of the Indenture shall govern and be controlling.

                                      A-3


         5. OPTIONAL REDEMPTION.

         (a) Except as set forth in clauses (b) and (c) of this Paragraph 5, the
Notes shall not be redeemable at the option of the Company prior to February 15,
2008. Beginning on February 15, 2008, the Company may redeem all or a part of
the Notes, at once or over time, in accordance with Section 3.03 of the
Indenture, at the redemption prices (expressed as percentages of principal
amount) set forth below, plus accrued and unpaid interest thereon on the Notes
redeemed, to the applicable redemption date (subject to the right of Holders of
record on the relevant Regular Record Date to receive interest due on the
relevant Interest Payment Date), if redeemed during the twelve-month period
commencing on February 15 of the years indicated below:



REDEMPTION YEAR                                                       PERCENTAGE
                                                                   
2008.................................................................   103.813%
2009.................................................................   102.542%
2010.................................................................   101.271%
2011 and thereafter..................................................   100.000%


         (b) At any time and from time to time prior to February 15, 2006, the
Company may on one or more occasions redeem up to 35% of the aggregate principal
amount of the Notes issued under this Indenture at a redemption price (expressed
as a percentage of principal amount) equal to 107.625% of the principal amount
thereof, plus accrued and unpaid interest thereon to the redemption date
(subject to the right of Holders of record on the relevant Regular Record Date
to receive interest due on the relevant Interest Payment Date) with the net cash
proceeds of one or more Equity Offerings; PROVIDED, HOWEVER, that (i) at least
65% of the aggregate principal amount of the Notes issued under this Indenture
(excluding Notes held by the Company and its Subsidiaries) remain outstanding
immediately following such redemption and (ii) any such redemption shall be made
within 90 days of the date of closing of any such Equity Offering.

         (c) If the Company becomes obligated to pay any Additional Amounts
because of a change in the laws or regulations of Canada or any Canadian Taxing
Authority, or a change in any official position regarding the application or
interpretation thereof, in either case that is publicly announced or becomes
effective on or after the Issue Date, the Company may, at any time, redeem all,
but not part, of the Notes at a price equal to 100% of the principal amount
thereof, plus accrued and unpaid interest to the redemption date, PROVIDED that
at any time that the aggregate principal amount of the Notes outstanding is
greater than US$20.0 million, any Holder of the Notes may, to the extent that it
does not adversely affect the Company's after-tax position, at its option, waive
the Company's compliance with the provisions of Section 4.20 of the Indenture;
PROVIDED, FURTHER, that if any Holder waives such compliance, the Company may
not redeem that Holder's Notes pursuant to this clause (c).

         (d) Any prepayment pursuant to this paragraph shall be made pursuant to
the provisions of Sections 3.01 through 3.06 of the Indenture.

         6. MANDATORY REDEMPTION. Except as set forth in Sections 4.12 and 4.18
of the Indenture, the Company shall not be required to make mandatory redemption
or sinking fund payments with respect to the Notes.

         7. REPURCHASE AT OPTION OF HOLDER.

         (a) Upon the occurrence of a Change of Control, the Company shall make
an offer to all Holders to repurchase all (equal to US$1,000 or an integral
multiple of US$1,000) of such Holder's Notes at a purchase price in cash equal
to 101% of the aggregate principal amount of the Notes repurchased, plus accrued
and unpaid interest on the Notes repurchased to the purchase date in accordance
with the procedures set forth in Section 3.09 of the Indenture.

         (b) If the Company or a Restricted Subsidiary consummates any Asset
Sales, it shall not be required to apply any Net Proceeds in accordance with the
Indenture until the aggregate Excess Proceeds from all Asset Sales following the
date the Notes are first issued exceeds US$20.0 million. Thereafter, the Company
shall commence an Asset Sale Offer by applying the Excess Proceeds pursuant to
Section 3.09 of the Indenture to purchase the

                                      A-4


maximum principal amount of Notes (including any Additional Notes) that may be
purchased out of the Excess Proceeds at an offer price in cash equal to 100% of
the principal amount thereof plus accrued and unpaid interest and Special
Interest, if any, to the Purchase Date in accordance with the procedures set
forth in Section 3.09 of the Indenture. To the extent that the aggregate amount
of Notes (including Additional Notes) tendered pursuant to an Asset Sale Offer
is less than the Excess Proceeds, the Company (or such Restricted Subsidiary)
may apply such deficiency for any purpose not prohibited by the Indenture. If
the aggregate principal amount of Notes surrendered by Holders thereof exceeds
the amount of Excess Proceeds, the Trustee shall select the Notes to be
purchased on a PRO RATA basis.

         8. NOTICE OF REDEMPTION. Notices of redemption shall be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in denominations
larger than US$1,000 may be redeemed in part but only in integral multiples of
US$1,000, unless all of the Notes held by a Holder are to be redeemed. On and
after the redemption date interest shall cease to accrue on Notes or portions
thereof called for redemption.

         9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of US$1,000 and integral multiples of US$1,000.
This Note shall represent the aggregate principal amount of outstanding Notes
from time to time endorsed hereon and the aggregate principal amount of Notes
represented hereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. The transfer of Notes may be
registered and Notes may be exchanged as provided in the Indenture. The
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and the Company may require a
Holder to pay any taxes and fees required by law or permitted by the Indenture.
The Company need not exchange or register the transfer of any Note or portion of
a Note selected for redemption, except for the unredeemed portion of any Note
being redeemed in part. Also, the Company need not exchange or register the
transfer of any Notes for a period of 15 days before a selection of Notes to be
redeemed or during the period between a record date and the corresponding
Interest Payment Date.

         10. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.

         11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Company and the Trustee may amend or supplement the Indenture or the Notes
with the consent of the Holders of at least a majority in principal amount of
the then outstanding Notes, including Additional Notes, if any, voting as a
single class (including consents obtained in connection with a purchase of or
tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and
6.07 of the Indenture, any existing Default or Event of Default (except a
continuing Default or Event of Default (i) in the payment of principal, premium,
if any, interest or Special Interest or Additional Amounts, if any, on the Notes
and (ii) in respect of a covenant or provision which under the Indenture cannot
be modified or amended without the consent of the Holder of each Note affected
by such modification or amendment) or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes, including Additional
Notes, if any, then outstanding voting as a single class (including consents
obtained in connection with a purchase of or tender offer or exchange offer for
the Notes). Without the consent of any Holder, the Company and the Trustee may
amend or supplement the Indenture or the Notes to (a) cure any ambiguity, defect
or inconsistency; (b) provide for uncertificated Notes in addition to or in
place of certificated Notes (PROVIDED that the uncertificated Notes are issued
in registered form for purposes of Section 163(f) of the Code, or in a manner
such that the uncertificated Notes are described in Section 163(f)(2)(B) of the
Code); (c) provide for the assumption of the obligations of the Company and/or a
Subsidiary Guarantor to Holders in the case of a merger, consolidation, or
amalgamation or sale of all or substantially all of the assets of the Company
and/or a Subsidiary Guarantor; PROVIDED, HOWEVER, that the Company shall deliver
to the Trustee (i) an Opinion of Counsel to the effect that Holders will not
recognize income, gain or loss for U.S. Federal income tax purposes as a result
of such assumption by a successor corporation and will be subject to U.S.
federal income tax on the same amount and in the same manner and at the same
times as would have been the case if such assumption had not occurred, and (ii)
an Opinion of Counsel in Canada to the effect that Holders will not recognize
income, gain or loss for Canadian federal, provincial or territorial tax
purposes as a result of such assumption by a successor corporation and will be
subject to Canadian federal, provincial or territorial taxes (including
withholding taxes) on the same amounts, in the same manner and at the same times
as would have been the case if such assumption had not occurred; (d) make any
change that would provide any additional rights or benefits to the

                                      A-5


Holders or that does not adversely affect the legal rights under this Indenture
of any such Holder; (e) add additional Guarantees with respect to the Notes or
release Subsidiary Guarantors from Subsidiary Guarantees as provided or
permitted by the terms of the Indenture; (f) provide for the issuance of
Additional Notes in accordance with the Indenture; or (g) comply with
requirements of the SEC in order to effect or maintain the qualification of this
Indenture under the TIA.

         12. DEFAULTS AND REMEDIES. Each of the following is an Event of Default
under the Indenture: (a) default for 30 days in the payment when due of interest
on, including Additional Amounts or Special Interest, if any, or with respect
to, the Notes; (b) default in payment, when due at Stated Maturity, upon
acceleration, redemption, required repurchase or otherwise, of the principal of,
or premium, if any, on the Notes; (c) failure by the Company or any Restricted
Subsidiary to comply with the provisions of Section 4.09, 4.10, 4.12, 4.18 or
5.01 of the Indenture; (d) failure by the Company or any Restricted Subsidiary
for 30 days after written notice thereof has been given to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least 25% of the
aggregate principal amount of the Notes outstanding to comply with any of its
other covenants or agreements in the Indenture; (e) default under any mortgage,
indenture or instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness by the Company or any Restricted
Subsidiary, or the payment of which is guaranteed by the Company or any
Restricted Subsidiary, whether such Indebtedness or guarantee now exists, or is
created after the Issue Date, if that default: (i) is caused by a failure to pay
principal of, or interest or premium, if any, on, such Indebtedness prior to the
expiration of the grace period provided in such Indebtedness on the date of such
default (a "PAYMENT DEFAULT"); or (ii) results in the acceleration of such
Indebtedness prior to its Stated Maturity, and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any other
such Indebtedness under which there has been a Payment Default or the maturity
of which has been so accelerated, aggregates US$25.0 million or more; (f)
failure by the Company or any Restricted Subsidiary to pay final, non-appealable
judgments aggregating in excess of US$25.0 million, which judgments are not
paid, discharged or stayed for a period of 60 days; (g) any Subsidiary Guarantee
of a Significant Subsidiary ceases, or the Subsidiary Guarantees of any group of
Subsidiaries that, when taken together, would constitute a Significant
Subsidiary cease, to be in full force and effect (other than in accordance with
the terms of any such Subsidiary Guarantee) or any Subsidiary Guarantor that is
a Significant Subsidiary denies or disaffirms its obligations under its
Subsidiary Guarantee, or a group of Subsidiary Guarantors that, when taken
together, would constitute a Significant Subsidiary deny or disaffirm their
obligations under their respective Subsidiary Guarantees; and (h) certain events
of bankruptcy, insolvency or reorganization affecting the Company or any of its
Significant Subsidiaries.

         If any Event of Default occurs and is continuing, the Trustee or the
Holders of at least 25% in principal amount of the then outstanding Notes may
declare all the Notes to be due and payable. Notwithstanding the foregoing, in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency described in the Indenture, all outstanding Notes shall become due
and payable without further action or notice. Holders may not enforce the
Indenture or the Notes except as provided in the Indenture. Subject to certain
limitations, Holders of a majority in aggregate principal amount of the then
outstanding Notes may direct the Trustee in its exercise of any trust or power.
The Trustee may withhold from Holders notice of any continuing Default or Event
of Default (except a Default or Event of Default relating to the payment of
principal, premium, if any, or interest or Special Interest or Additional
Amounts, if any) if a majority of the Responsible Officers determines that
withholding notice is in the interests of the Holders. The Holders of a majority
in aggregate principal amount of the Notes then outstanding by notice to the
Trustee may on behalf of the Holders of all of the Notes waive any existing
Default or Event of Default and its consequences under the Indenture except a
continuing Default or Event of Default in the payment of principal, premium, if
any, or interest or Special Interest or Additional Amounts, if any. The Company
is required to deliver to the Trustee annually a statement regarding compliance
with the Indenture, and the Company is required upon becoming aware of any
Default or Event of Default, to deliver to the Trustee a statement specifying
such Default or Event of Default.

         13. TRUSTEE DEALINGS WITH COMPANY. Subject to certain limitations, the
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Company or any Affiliate of the Company
with the same rights it would have if it were not Trustee.

         14. NO RECOURSE AGAINST OTHERS. No past, present or future director,
officer, employee, incorporator or stockholder of the Company or of any
Guarantor, as such, shall have any liability for any obligations of the Company
or any Guarantor under the Indenture, the Notes, the Guarantees or for any claim
based on, in respect of,

                                      A-6


or by reason of, such obligations or their creation. Each Holder by accepting a
Note waives and releases all such liability.

         15. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.

         16. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).

         17. ADDITIONAL RIGHTS OF HOLDERS OF RESTRICTED GLOBAL NOTES AND
RESTRICTED DEFINITIVE NOTES. In addition to the rights provided to Holders of
Notes under the Indenture, Holders of Restricted Global Notes and Restricted
Definitive Notes that are Initial Notes shall have all the rights set forth in
the Registration Rights Agreement, dated as of February 7, 2003, among the
Company and the parties named on the signature pages thereto or, in the case of
Additional Notes, Holders of Restricted Global Notes and Restricted Definitive
Notes shall have the rights set forth in one or more Registration Rights
Agreements, if any, among the Company and the other parties thereto, relating to
rights given by the Company to the purchasers of such Additional Notes.

         18. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
CUSIP numbers to be printed on the Notes and has directed the Trustee to use
CUSIP numbers in notices of redemption or notices of Offers to Purchase as a
convenience to Holders. No representation is made as to the correctness of such
numbers either as printed on the Notes or as contained in any notice of
redemption or notice of an Offer to Purchase and reliance may be placed only on
the other identification numbers printed thereon and any such redemption or
Offer to Purchase shall not be affected by any defect in or omission of such
numbers.

         The Company shall furnish to any Holder upon written request and
without charge a copy of the Indenture. Requests may be made to: Sun Media
Corporation, 333 King Street East, Toronto, Ontario M5A 3XS, Canada, Attention:
Vice President, Corporate Controller.

          19. GOVERNING LAW. The internal law of the State of New York shall
govern and be used to construe this Note without giving effect to applicable
principals of conflicts of law to the extent that the application of the laws of
another jurisdiction would be required thereby.

                                      A-7



                       Option of Holder to Elect Purchase

If you want to elect to have this Note purchased by the Company pursuant to
Section 4.12 or 4.18 of the Indenture, check the box below:

[  ]         Section 4.12

[  ]         Section 4.18

If you want to elect to have only part of the Note purchased by the Company
pursuant to Section 4.12 or Section 4.18 of the Indenture, state the amount you
elect to have purchased: US$_____________________

Date:_____________  Your Signature:________________________________
                    (Sign exactly as your name appears on the face of this Note)

                    Tax Identification No.:

                    ____________________________________________


                    SIGNATURE GUARANTEE:


                    ____________________________________________

                    Signatures must be guaranteed by an "eligible guarantor
                    institution" meeting the requirements of the Registrar,
                    which requirements include membership or participation in
                    the Security Transfer Agent Medallion Program ("STAMP") or
                    such other "signature guarantee program" as may be
                    determined by the Registrar in addition to, or in
                    substitution for, STAMP, all in accordance with the
                    Securities Exchange Act of 1934, as amended.


                                      A-8



                                 ASSIGNMENT FORM

To assign this Note, fill in the form below:


(I) or (we) assign and transfer this Note to

________________________________________________________________________________
            (Insert assignee's social security or other tax I.D. no.)

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________
              (Print or type assignee's name, address and zip code)


and irrevocably appoint ________________________________________________________
as agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.


Date: ______________
                               Your Signature: _________________________________
                               (Sign exactly as your name appears on the face of
                               this Note)

                               Signature Guarantee:_____________________________

                               Signatures must be guaranteed by an "eligible
                               guarantor institution" meeting the requirements
                               of the Registrar, which requirements include
                               membership or participation in the Security
                               Transfer Agent Medallion Program ("STAMP") or
                               such other "signature guarantee program" as may
                               be determined by the Registrar in addition to, or
                               in substitution for, STAMP, all in accordance
                               with the Securities Exchange Act of 1934, as
                               amended.



                                      A-9




              SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

                  The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:




                                                                           Principal Amount
                                Amount of                                 of this Global Note       Signature of
                               decrease in         Amount of increase       following such      authorized signatory
                            Principal Amount      in Principal Amount        decrease (or           of Trustee or
Date of Exchange           of this Global Note    of this Global Note          increase)           Note Custodian
- ----------------           -------------------    -------------------          ---------           --------------
                                                                                    











                                      A-10


                                    EXHIBIT B

                         FORM OF CERTIFICATE OF TRANSFER

Sun Media Corporation
333 King Street East
Toronto, Ontario M5A 3X5
Canada
Attention:  Vice President, Corporate Controller

National City Bank
Corporate Trust Department, Locator 01-3116
629 Euclid Avenue
Cleveland, Ohio  44114-3484
Attention: Corporate Trust Department
Facsimile No.:  (216) 222-9326

         Re:          7-5/8% SENIOR NOTES DUE 2013
                      ----------------------------

                  Reference is hereby made to the Indenture, dated as of
February 7, 2003 (the "INDENTURE"), among Sun Media Corporation, as issuer (the
"COMPANY"), the Subsidiary Guarantors party thereto and National City Bank, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.

                  ___________________, (the "TRANSFEROR") owns and proposes to
transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in
the principal amount of US$___________ in such Note[s] or interests (the
"TRANSFER"), to ___________________________ (the "TRANSFEREE"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:

                             [CHECK ALL THAT APPLY]

               1. [  ] Check if Transferee will take delivery of a beneficial
interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "SECURITIES ACT"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Note is being transferred to a Person that the Transferor
reasonably believed and believes is purchasing the beneficial interest or
Definitive Note for its own account, or for one or more accounts with respect to
which such Person exercises sole investment discretion, and such Person and each
such account is a "qualified institutional buyer" within the meaning of Rule
144A in a transaction meeting the requirements of Rule 144A and such Transfer is
in compliance with any applicable blue sky securities laws of any state of the
United States. Upon consummation of the proposed Transfer in accordance with the
terms of the Indenture, the transferred beneficial interest or Definitive Note
will be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the 144A Global Note and/or the Definitive Note and
in the Indenture and the Securities Act.

               2. [  ] Check if Transferee will take delivery of a beneficial
interest in the Regulation S Global Note or a Definitive Note pursuant to
Regulation S. The Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a Person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(a) of Regulation S under the Securities Act, (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act and (iv) if the proposed transfer is being made prior to the
expiration of the Distribution Compliance Period, the transfer is not being made
to a U.S. Person or for the account or benefit of a U.S. Person (other than an
Initial Purchaser). Upon consummation of the proposed transfer in accordance
with the terms of the Indenture, the


                                      B-1


transferred beneficial interest or Definitive Note will be subject to the
restrictions on Transfer enumerated in the Private Placement Legend printed on
the Regulation S Global Note, the Temporary Regulation S Global Note and/or the
Definitive Note and in the Indenture and the Securities Act.

               3. [  ] Check and complete if Transferee will take delivery of a
beneficial interest in the IAI Global Note or a Definitive Note pursuant to any
provision of the Securities Act other than Rule 144A or Regulation S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Notes and Restricted
Definitive Notes and pursuant to and in accordance with the Securities Act and
any applicable blue sky securities laws of any state of the United States, and
accordingly the Transferor hereby further certifies that (check one):

                  (a) [  ] such Transfer is being effected  pursuant to and in
         accordance with Rule 144 under the Securities Act;

                           or

                  (b) [  ] such Transfer is being effected to the Company or a
         Subsidiary thereof;

                           or

                  (c) [  ] such Transfer is being effected pursuant to an
         effective registration statement under the Securities Act and in
         compliance with the prospectus delivery requirements of the Securities
         Act;

                           or

                  (d) [  ] such Transfer is being effected to an
         Institutional Accredited Investor and pursuant to an exemption from the
         registration requirements of the Securities Act other than Rule 144A,
         Rule 144 or Rule 904, and the Transferor hereby further certifies that
         it has not engaged in any general solicitation within the meaning of
         Regulation D under the Securities Act and the Transfer complies with
         the transfer restrictions applicable to beneficial interests in a
         Restricted Global Note or Restricted Definitive Notes and the
         requirements of the exemption claimed, which certification is supported
         by (1) a certificate executed by the Transferee in the form of Exhibit
         D to the Indenture and (2) if such Transfer is in respect of a
         principal amount of Notes at the time of transfer of less than
         US$250,000, an Opinion of Counsel provided by the Transferor or the
         Transferee (a copy of which the Transferor has attached to this
         certification), to the effect that such Transfer is in compliance with
         the Securities Act. Upon consummation of the proposed transfer in
         accordance with the terms of the Indenture, the transferred beneficial
         interest or Definitive Note will be subject to the restrictions on
         transfer enumerated in the Private Placement Legend printed on the IAI
         Global Note and/or the Definitive Notes and in the Indenture and the
         Securities Act.

               4. [  ] Check if Transferee will take delivery of a beneficial
interest in an Unrestricted Global Note or of an Unrestricted Definitive Note.

               (a) [  ] CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The
Transfer is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Indenture and any applicable blue sky securities laws of any state of the United
States and (ii) the restrictions on transfer contained in the Indenture and the
Private Placement Legend are not required in order to maintain compliance with
the Securities Act. Upon consummation of the proposed Transfer in accordance
with the terms of the Indenture, the transferred beneficial interest or
Definitive Note will no longer be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes, on Restricted Definitive Notes and in the Indenture.

               (b) [  ] CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the

                                      B-2


transfer restrictions contained in the Indenture and any applicable blue sky
securities laws of any state of the United States and (ii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Indenture, the transferred beneficial interest or Definitive Note will no longer
be subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the Restricted Global Notes, on Restricted Definitive Notes
and in the Indenture.

               (c) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Indenture and any applicable blue sky securities laws of any State of the
United States and (ii) the restrictions on transfer contained in the Indenture
and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Indenture, the transferred beneficial
interest or Definitive Note will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Notes or Restricted Definitive Notes and in the Indenture.

               This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.


                                                     ___________________________
                                                     [Insert Name of Transferor]


                                                     By:________________________
                                                        Name:
                                                        Title:

                                                     Dated:  ___________________



                                      B-3




                       ANNEX A TO CERTIFICATE OF TRANSFER

            1.       The Transferor owns and proposes to transfer the following:

                            [CHECK ONE OF (a) OR (b)]

                      (a)    [  ] a beneficial interest in the:

                        (i)  [  ] 144A Global Note (CUSIP _________), or

                        (ii) [  ] Regulation S Global Note (CUSIP _________), or

                        (iii)[  ] IAI Global Note (CUSIP _________); or

                      (b)    [  ] a Restricted Definitive Note.

            2.       After the Transfer the Transferee will hold:

                         [CHECK ONE OF (a), (b) OR (c)]

                      (a)    [  ] a beneficial interest in the:

                        (i)  [  ] 144A Global Note (CUSIP _________), or

                        (ii) [  ] Regulation S Global Note (CUSIP _________), or

                        (iii)[  ] IAI Global Note (CUSIP _________); or

                        (iv) [  ] Unrestricted Global Note (CUSIP _________); or

                      (b)    [  ] a Restricted Definitive Note; or

                      (c)    [  ] an Unrestricted Definitive Note,

                      in accordance with the terms of the Indenture.



                                      B-4


                                    EXHIBIT C

                         FORM OF CERTIFICATE OF EXCHANGE

Sun Media Corporation
333 King Street East
Toronto, Ontario M5A 3X5
Canada
Attention:

National City Bank
629 Euclid Avenue, Locator 01-3116
Cleveland, Ohio  44114-3484
Attention: Corporate Trust Department
Facsimile No.:  (216) 222-9326

         Re:          7-5/8% SENIOR NOTES DUE 2013
                      ----------------------------

                  Reference is hereby made to the Indenture, dated as of
February 7, 2003 (the "INDENTURE"), among Sun Media Corporation, as issuer (the
"COMPANY"), the Subsidiary Guarantors party thereto and National City Bank, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.

                  __________________________, (the "OWNER") owns and proposes to
exchange the Note[s] or interest in such Note[s] specified herein, in the
principal amount of US$____________ in such Note[s] or interests (the
"EXCHANGE"). In connection with the Exchange, the Owner hereby certifies that:

                  1. Exchange of Restricted Definitive Notes or Beneficial
Interests in a Restricted Global Note for Unrestricted Definitive Notes or
Beneficial Interests in an Unrestricted Global Note

                  (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Note for a beneficial interest in an Unrestricted Global Note in an equal
principal amount, the Owner hereby certifies (i) the beneficial interest is
being acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable to the
Restricted Global Note and pursuant to and in accordance with the United States
Securities Act of 1933, as amended (the "SECURITIES ACT"), (iii) the
restrictions on transfer contained in the Indenture and the Private Placement
Legend are not required in order to maintain compliance with the Securities Act
and (iv) the beneficial interest in an Unrestricted Global Note is being
acquired in compliance with any applicable blue sky securities laws of any state
of the United States.

                  (b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO UNRESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for an
Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted
Definitive Note is being acquired for the Owner's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Note and pursuant to and in
accordance with the Securities Act, (iii) the restrictions on transfer contained
in the Indenture and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Unrestricted Definitive
Note is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.

                  (c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE
TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL NOTE. In connection with the
Owner's Exchange of a Restricted Definitive Note for a beneficial interest in an
Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest
is being acquired for the Owner's own account without transfer, (ii) such
Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Notes and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Indenture and the Private Placement Legend are not required in

                                      C-1


order to maintain compliance with the Securities Act and (iv) the beneficial
interest is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.

                  (d) [ ]CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE TO
UNRESTRICTED DEFINITIVE NOTE. In connection with the Owner's Exchange of a
Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby
certifies (i) the Unrestricted Definitive Note is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Notes and
pursuant to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Indenture and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Note is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.

                  2. Exchange of Restricted Definitive Notes or Beneficial
Interests in Restricted Global Notes for Restricted Definitive Notes or
Beneficial Interests in Restricted Global Notes

                  (a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A
RESTRICTED GLOBAL NOTE TO RESTRICTED DEFINITIVE NOTE. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Note for a
Restricted Definitive Note with an equal principal amount, the Owner hereby
certifies that the Restricted Definitive Note is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Indenture, the Restricted Definitive Note
issued will continue to be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the Restricted Definitive Note and in
the Indenture and the Securities Act.

                  (b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE NOTE
TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL NOTE. In connection with the
Exchange of the Owner's Restricted Definitive Note for a beneficial interest in
the [CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note
with an equal principal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer and (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to the Restricted Definitive Note and pursuant to and in accordance
with the Securities Act, and in compliance with any applicable blue sky
securities laws of any state of the United States. Upon consummation of the
proposed Exchange in accordance with the terms of the Indenture, the beneficial
interest issued will be subject to the restrictions on transfer enumerated in
the Private Placement Legend printed on the relevant Restricted Global Note and
in the Indenture and the Securities Act.



                                      C-2



                  This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.


                                             ________________________________
                                                 [Insert Name of Transferor]


                                             By:_____________________________
                                                Name:
                                                Title:

                                             Dated:  ______________________



                                      C-3


                                    EXHIBIT D

                            FORM OF CERTIFICATE FROM
                   ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

Sun Media Corporation
333 King Street East
Toronto, Ontario M5A 3X5
Canada
Attention:

National City Bank
629 Euclid Avenue, Locator 01-3116
Cleveland, Ohio  44114-3484
Attention: Corporate Trust Department
Facsimile No.:  (216) 222-9326

         Re:          7-5/8% SENIOR NOTES DUE 2013
                      ----------------------------

                  Reference is hereby made to the Indenture, dated as of
February 7, 2003 (the "INDENTURE"), among Sun Media Corporation, as issuer (the
"COMPANY"), the Subsidiary Guarantors party thereto and National City Bank, as
trustee. Capitalized terms used but not defined herein shall have the meanings
given to them in the Indenture.

                  In connection with our proposed purchase of US$____________
aggregate principal amount of:

                  (a) [ ]   a beneficial interest in a Global Note, or

                  (b) [ ]   a Definitive Note,

                            we confirm that:

                  1. We understand that any subsequent transfer of the Notes or
any interest therein is subject to certain restrictions and conditions set forth
in the Indenture and the undersigned agrees to be bound by, and not to resell,
pledge or otherwise transfer the Notes or any interest therein except in
compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "SECURITIES ACT").

                  2. We understand that the offer and sale of the Notes have not
been registered under the Securities Act, and that the Notes and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Notes or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein) that purchases for its own
account or for the account of a qualified institutional buyer to whom notice is
given that the transfer is being made in reliance on Rule 144A under the
Securities Act, (C) to an institutional "accredited investor" (as defined below)
that, prior to such transfer, furnishes (or has furnished on its behalf by a
U.S. broker-dealer) to you and to the Company a signed letter substantially in
the form of this letter and, such transfer is in respect of a minimum principal
amount of Notes of US$250,000, (D) pursuant to offers and sales to non-U.S.
Persons that occur outside the United States in accordance with Rule 904 of
Regulation S under the Securities Act, (E) pursuant to any other available
exemption under the Securities Act or (F) pursuant to an effective registration
statement under the Securities Act, and we further agree to provide to any
Person purchasing the Definitive Note or beneficial interest in a Global Note
from us in a transaction meeting the requirements of clauses (A) through (E) of
this paragraph a notice advising such purchaser that resales thereof are
restricted as stated herein.

                  3. We understand that, on any proposed resale of the Notes or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you

                                       D-1


and the Company may reasonably require to confirm that the proposed sale
complies with the foregoing restrictions. We further understand that the Notes
purchased by us will bear a legend to the foregoing effect.

                  4. We are an institutional "accredited investor" (as defined
in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Notes, and
we and any accounts for which we are acting are each able to bear the economic
risk of our or its investment. We have had access to such financial and other
information and have been afforded the opportunity to ask such questions of
representatives of the Company and receive answers thereto, as we deem necessary
in connection with our decision to purchase the Notes.

                  5. We are acquiring the Notes or beneficial interest therein
purchased by us for our own account, or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion, for investment purposes only and are not acquiring the
Notes with a view to any distribution thereof in a transaction that would
violate the Securities Act of the securities laws of any state of the United
States or any other applicable jurisdiction.

                  You and the Company are entitled to rely upon this letter and
are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. This letter shall be governed by,
and construed in accordance with, the laws of the State of New York.


                                            ____________________________________
                                            [Insert Name of Accredited Investor]


                                            By:_________________________________
                                               Name:
                                               Title:


Dated: ______________________


                                       D-2


                                    EXHIBIT E

                          FORM OF NOTATION OF GUARANTEE

                  For value received, each Subsidiary Guarantor (which term
includes any successor Person under the Indenture), jointly and severally,
hereby unconditionally guarantees, to the extent set forth in the Indenture and
subject to the provisions in the Indenture, dated as of February 7, 2003 (the
"INDENTURE"), among Sun Media Corporation, as issuer (the "COMPANY"), the
Subsidiary Guarantors listed on the signature pages thereto and National City
Bank, as trustee (the "TRUSTEE"), (a) the due and punctual payment of the
principal of, premium, if any, and interest and Special Interest and Additional
Amounts, if any, on the Notes, whether at maturity, by acceleration, redemption
or otherwise, the due and punctual payment of interest on overdue principal and
premium, if any, and, to the extent permitted by law, interest and Special
Interest and Additional Amounts, if any, and the due and punctual performance of
all other obligations of the Company to the Holders or the Trustee under the
Notes and the Indenture, all in accordance with the terms of the Notes and the
Indenture; and (b) in case of any extension of time of payment or renewal of any
Notes or any of such other obligations, that the same shall be promptly paid in
full when due or performed in accordance with the terms of the extension or
renewal, whether at maturity, by acceleration pursuant to Section 6.02 of the
Indenture, redemption or otherwise. The obligations of the Subsidiary Guarantors
to the Holders of Notes and to the Trustee pursuant to the Subsidiary Guarantee
and the Indenture are expressly set forth in Article 10 of the Indenture and
reference is hereby made to the Indenture for the precise terms of the
Subsidiary Guarantee. Except to the extent provided in the Indenture, including
Sections 8.02, 8.03 and 10.05 thereof, this Subsidiary Guarantee shall not be
discharged except by complete performance of the obligations contained herein
and in the Indenture. Each Holder of a Note, by accepting the same agrees to and
shall be bound by such provisions. Capitalized terms used herein and not defined
are used herein as so defined in the Indenture.

                                                [NAME OF GUARANTOR]

                                                By:__________________________
                                                    Name:
                                                    Title:



                                       E-1



                                    EXHIBIT F

                         FORM OF SUBORDINATION AGREEMENT

         This SUBORDINATION AGREEMENT is dated as of          (the "Agreement").

To:      National City Bank, for itself and as trustee under the Indenture
         referred to below for the holders of the Securities (the "Trustee")

                  [OBLIGOR] (the "Obligor"), as obligor under the convertible
obligation dated as of          , made by the Obligor in favour of [HOLDER]
(the "Subordinated Note"), and [HOLDER], as holder (the "Holder") of the
Subordinated Note, for ten dollars and other good and valuable consideration
received by each of the Obligor and the Holder from the Trustee and by each
of the Obligor and the Holder from the other, agree as follows:

1.       INTERPRETATION.

         (a) "CASH, PROPERTY OR SECURITIES". "Cash, Property or Securities"
shall not be deemed to include securities of the Obligor or any other Person
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided herein with respect to the
Subordinated Note, to the payment of all Senior Indebtedness which may at the
time be outstanding; provided, however, that (i) all Senior Indebtedness is
assumed by the new Person, if any, resulting from any such reorganization or
readjustment, and (ii) the rights of the holders of the Senior Indebtedness are
not, without the consent of such holders, altered by such reorganization or
readjustment.

         (b) "PAYMENT IN FULL". "payment in full", with respect to Senior
Indebtedness, means the receipt on an irrevocable basis of cash in an amount
equal to the unpaid principal amount of the Senior Indebtedness and premium, if
any, and interest and any special interest thereon to the date of such payment,
together with all other amounts owing with respect to such Senior Indebtedness.

         (c) "SENIOR INDEBTEDNESS". "Senior Indebtedness" means, at any date all
indebtedness (including, without limitation, any and all amounts of principal,
interest, special interest, additional amounts, premium, fees, penalties,
indemnities and "post-petition interest" in bankruptcy and any reimbursement of
expenses) under (1) the Indenture, including, without limitation, the "Notes,"
the "Subsidiary Guarantees," the "Exchange Notes," the "Additional Notes" and
any "Guarantee" of the Exchange Notes or the Additional Notes (in each case, as
defined in the Indenture) and (2) the Credit Agreement, dated as of February 7,
2003, among Sun Media Corporation ("Sun Media"), the financial institutions
identified as lenders therein, Banc of America Securities LLC, as joint lead
arranger, Bank of America, N.A., as administrative agent, and Credit Suisse
First Boston Corporation, as joint lead arranger and syndication agent.

2.       AGREEMENT ENTERED INTO PURSUANT TO INDENTURE. The Obligor and the
Holder are entering into this Agreement pursuant to the provisions of the
Indenture, dated as of February 7, 2003 (the "Indenture"; capitalized terms
used herein without definition having the meanings set forth therein) among
Sun Media, the Subsidiary Guarantors and the Trustee. Pursuant to the
Indenture, Sun Media has issued and the Subsidiary Guarantors have
guaranteed, US$205,000,000 aggregate principal amount of Sun Media's 7-5/8%
Senior Notes due 2013 (the "Securities").

3.       SUBORDINATION. The indebtedness represented by the Subordinated Note
shall be subordinated as follows:

         (a) AGREEMENT TO SUBORDINATE. The Obligor, for itself and its
successors and assigns, and the Holder agree, that the indebtedness evidenced by
the Subordinated Note (including, without limitation,

                                       F-1


principal, interest, premium, fees, penalties, indemnities and "post-petition
interest" in bankruptcy and any reimbursement of expenses) is subordinate and
junior in right of payment, to the extent and in the manner provided in this
Section 3, to the prior payment in full of all Senior Indebtedness. The
provisions of this Section 3 are for the benefit of the Trustee acting on behalf
of the holders from time to time of Senior Indebtedness, and such holders are
hereby made obligees hereunder to the same extent as if their names were written
herein as such, and they (collectively or singly) may proceed to enforce such
provisions.

         (b) LIQUIDATION, DISSOLUTION OR BANKRUPTCY.

             (i) Upon any distribution of assets of the Obligor to creditors or
                 upon a liquidation or dissolution or winding-up of the Obligor
                 or in a bankruptcy, arrangement, liquidation, reorganization,
                 insolvency, receivership or similar case or proceeding relating
                 to the Obligor or its property or other marshalling of assets
                 of the Obligor:

                 (A) the holders of Senior Indebtedness shall be entitled to
                     receive payment in full of all Senior Indebtedness before
                     the Holder shall be entitled to receive any payment of
                     principal of or interest on, or any other amount owing in
                     respect of, the Subordinated Note;

                 (B) until payment in full of all Senior Indebtedness, any
                     distribution of assets of the Obligor of any kind or
                     character to which the Holder would be entitled but for
                     this Section 3 is hereby assigned to the holders of Senior
                     Indebtedness absolutely and shall be paid by the Obligor or
                     by any receiver, trustee in bankruptcy, liquidating
                     trustee, agents or other Persons making such payment or
                     distribution to the Trustee on behalf of the holders of
                     Senior Indebtedness, as their interests may appear; and

                 (C) in the event that, notwithstanding the foregoing, any
                     payment or distribution of assets of the Obligor of any
                     kind or character, whether in Cash, Property or Securities,
                     shall be received by the Holder before all Senior
                     Indebtedness is paid in full, such payment or distribution
                     shall be held in trust for the benefit of and shall be paid
                     over to the Trustee on behalf of the holders of Senior
                     Indebtedness, as their interests may appear, for
                     application to the payment of all Senior Indebtedness until
                     all Senior Indebtedness shall have been paid in full after
                     giving effect to any concurrent payment or distribution to
                     the holders of Senior Indebtedness in respect of such
                     Senior Indebtedness.

            (ii) If (A) a bankruptcy, reorganization, insolvency, receivership
                 or similar proceeding relating to the Obligor or its property
                 (a "Reorganization Proceeding") is commenced and is continuing
                 and (B) the Holder does not file proper claims or proofs of
                 claim in the form required in a Reorganization Proceeding prior
                 to 45 days before the expiration of the time to file such
                 claims, then (1) upon the request of the Trustee, the Holder
                 shall file such claims and proofs of claim in respect of the
                 Subordinated Note and execute and deliver such powers of
                 attorney, assignments and proofs of claim or proxies as may be
                 directed by the Trustee to enable it to exercise in the sole
                 discretion of the Trustee any and all voting rights
                 attributable to the Subordinated Note which are capable of
                 being voted (whether by meeting, written resolution or
                 otherwise) in a Reorganization Proceeding and enforce any and
                 all claims upon or in respect of the Subordinated Note and to
                 collect and receive any and all payments or distributions which
                 may be payable or deliverable at any time upon or in respect

                                         ii


                 of the Subordinated Note, and (2) whether or not the Trustee
                 shall take the action described in clause (1) above, the
                 Trustee shall nevertheless be deemed to have such powers of
                 attorney as may be necessary to enable the Trustee to exercise
                 such voting rights, file appropriate claims and proofs of claim
                 and otherwise exercise the powers described above for and on
                 behalf of the Holder.

         (c) SUBROGATION. After all Senior Indebtedness is paid in full and
until the Subordinated Note is paid in full, the Holder shall be subrogated to
the rights of the holders of Senior Indebtedness. For purposes of this Section
3(c), a distribution made under this Section 3 to holders of Senior Indebtedness
which otherwise would have been made to the Holder, or a payment made by the
Holder to holders of Senior Indebtedness in respect of a turnover obligation
under this Section 3, is not, as between the Obligor and such holder, a payment
by the Obligor on Senior Indebtedness.

         (d) RELATIVE RIGHTS. This Section 3 defines the relative rights of the
Holder and the holders of Senior Indebtedness. Nothing in this Section 3 shall:

             (i)   impair, as between the Obligor and the Holder, the obligation
                   of the Obligor, which is absolute and unconditional, to pay
                   the principal of and interest on the Subordinated Note in
                   accordance with its terms; or

             (ii)  affect the relative rights of the Holder and creditors of the
                   Obligor other than the holders of Senior Indebtedness; or

             (iii) affect the relative rights of the holders of Senior
                   Indebtedness among themselves; or

             (iv)  prevent the Holder from exercising its available remedies
                   upon a default, subject to the rights of the holders of
                   Senior Indebtedness to receive cash, property or other assets
                   otherwise payable to the Holder.

         (e) SUBORDINATION MAY NOT BE IMPAIRED.

             (i)   No right of any holder of Senior Indebtedness to enforce the
                   subordination of indebtedness evidenced by the Subordinated
                   Note shall in any way be prejudiced or impaired by any act or
                   failure to act by the Obligor or by any such holder or the
                   Trustee, or by any non-compliance by the Obligor with the
                   terms, provisions or covenants herein, regardless of any
                   knowledge thereof which any such holder or the Trustee may
                   have or be otherwise charged with. Neither the subordination
                   of the Subordinated Note as herein provided nor the rights of
                   the holders of Senior Indebtedness with respect hereto shall
                   be affected by any extension, renewal or modification of the
                   terms, or the granting of any security in respect of, any
                   Senior Indebtedness or any exercise or non-exercise of any
                   right, power or remedy with respect thereto.

             (ii)  The Holder agrees that all indebtedness evidenced by the
                   Subordinated Note will be unsecured by any Lien upon or with
                   respect to any property of the Obligor.

             (iii) The Holder agrees not to exercise any offset or counterclaim
                   or similar right in respect of the indebtedness evidenced by
                   the Subordinated Note except to the extent payment of such
                   indebtedness is permitted and will not assign or otherwise
                   dispose of the Subordinated Note or the indebtedness which it
                   evidences unless the assignee or acquiror, as the case may
                   be, agrees to be bound by the terms of this Agreement.

                                         iii


         (f) HOLDER ENTITLED TO RELY. Upon any payment or distribution pursuant
to this Section 3, the Holder shall be entitled to rely (i) upon any order or
decree of a court of competent jurisdiction in which any proceedings of the
nature referred to in Section 3(b) are pending, (ii) upon a certificate if the
liquidating trustee or agent or other person in such proceedings making such
payment or distribution to the Holder or its representative, if any, or (iii)
upon a certificate of the Trustee or any representative (if any) of the holders
of Senior Indebtedness for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Obligor, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Section 3.

4.       ENFORCEABILITY. Each of the Obligor and the Holder represents and
warrants that this Agreement has been duly authorized, executed and delivered
by each of the Obligor and the Holder and constitutes a valid and legally
binding obligation of each of the Obligor and the Holder, enforceable in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; and on the date hereof, the Holder shall deliver an
opinion or opinions of counsel to such effect to the Trustee for the benefit
of the holders of the Securities.

5.       MISCELLANEOUS.

         (a) Until payment in full of all the Senior Indebtedness, the Obligor
and the Holder agree that no amendment shall be made to the Subordinated Note
which would affect the rights of the holders of the Senior Indebtedness
hereunder.

         (b) This Agreement may not be amended or modified in any respect, nor
may any of the terms or provisions hereof be waived, except by an instrument
signed by the Obligor, the Holder and the Trustee.

         (c) This Agreement shall be binding upon each of the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
Trustee and each and every holder of Senior Indebtedness and their respective
successors and assigns.

         (d) This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.

         (e) The Holder and the Obligor each hereby irrevocably agrees that any
suits, actions or proceedings arising out of or in connection with this
Agreement may be brought in any state or federal court sitting in The City of
New York or any court in the Province of Quebec and submits and attorns to the
non-exclusive jurisdiction of each such court.

         (f) The Holder and the Obligor will whenever and as often as reasonably
requested to do so by the Trustee, do, execute, acknowledge and deliver any and
all such other and further acts, assignments, transfers and any instruments of
further assurance, approvals and consents as are necessary or proper in order to
give complete effect to this Agreement.

         (g) Each of the Holder and the Obligor irrevocably appoints CT
Corporation System, as its authorized agent in the State of New York upon which
process may be served in any such suit or proceedings, and agrees that service
of process upon such agent, and written notice of said service to CT Corporation
System, by the person serving the same to the addresses listed below, shall be
deemed in every respect effective service of process upon the Holder or the
Obligor, as applicable, in any such suit or proceeding.

         If to the Obligor:


                                         iv


         [        ]

         If to the Holder:

         [        ]

         Each of the Holder and the Obligor further agrees to take any and all
action as may be necessary to maintain such designation and appointment of such
agent in full force and effect for a period of ten years from the date of this
Agreement.



                                         v





                  IN WITNESS WHEREOF, the Obligor and the Holder each have
caused this Agreement to be duly executed.

                                                [OBLIGOR]
                                                by
                                                  ------------------------------
                                                   Name:     |X|
                                                   Title:    |X|

                                                [HOLDER]
                                                by
                                                  ------------------------------
                                                   Name:     |X|
                                                   Title:    |X|





                                         vi

EX-4.3

                                                                    EXHIBIT 4.3


                              SUN MEDIA CORPORATION

                            7 5/8% SENIOR NOTES DUE 2013


                          REGISTRATION RIGHTS AGREEMENT


                                                              New York, New York
                                                                February 7, 2003

Salomon Smith Barney Inc.
RBC Dominion Securities Corporation
TD Securities (USA) Inc.
BMO Nesbitt Burns Corp.
Credit Suisse First Boston Corporation
Scotia Capital (USA) Inc.
CIBC World Markets Corp.
   c/o Salomon Smith Barney Inc.
   388 Greenwich Street
   New York, New York 10013

Ladies and Gentlemen:

                  Sun Media Corporation, a company continued under the laws of
the Province of British Columbia (the "Company"), proposes to issue and sell its
7 5/8% Senior Notes due 2013 (the "Notes") to certain purchasers (the "Initial
Purchasers"), upon the terms set forth in a Purchase Agreement, dated as of
January 30, 2003, by and among the Company, the subsidiary guarantors signatory
thereto and the Initial Purchasers (the "Purchase Agreement") relating to the
initial placement of the Notes (the "Initial Placement"). The Notes will be
guaranteed (the "Guarantees" and, together with the Notes, the "Securities") on
an unsecured senior basis by each of the Company's direct and indirect
subsidiaries set forth on the signature page hereto (the "Subsidiary
Guarantors"). To induce the Initial Purchasers to enter into the Purchase
Agreement and to satisfy a condition of your obligations thereunder, the Company
and the Subsidiary Guarantors, jointly and severally, agree with you for your
benefit and the benefit of the holders from time to time of the Securities
(including the Initial Purchasers) (each a "Holder" and, together, the
"Holders"), as follows:

                  1.   DEFINITIONS. Capitalized terms used herein without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following capitalized defined terms
shall have the following meanings:

                  "Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.

                  "Affiliate" of any specified Person shall mean any other
Person that, directly or indirectly, is in control of, is controlled by, or is
under common control with, such specified








Person. For purposes of this definition, control of a Person shall mean the
power, direct or indirect, to direct or cause the direction of the management
and policies of such Person whether by contract or otherwise; and the terms
"controlling" and "controlled" shall have meanings correlative to the foregoing.

                  "Broker-Dealer" shall mean any broker or dealer registered as
such under the Exchange Act.

                  "Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in New York City.

                  "Commission" shall mean the Securities and Exchange
Commission.

                  "Company" shall have the meaning set forth in the preamble
hereto.

                  "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.

                  "Exchange Offer Registration Period" shall mean the period
following the consummation of the Registered Exchange Offer, which period shall
end on the sooner of the 180th day after the consummation of the Registered
Exchange Offer and the date on which all Exchanging Dealers have sold all New
Securities held by them (unless such period is extended pursuant to Section 5(k)
hereof).

                  "Exchange Offer Registration Statement" shall mean a
registration statement of the Company and the Subsidiary Guarantors on an
appropriate form under the Act with respect to the Registered Exchange Offer,
all amendments and supplements to such registration statement, including
post-effective amendments thereto, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.

                  "Exchanging Dealer" shall mean any Holder (which may include
any Initial Purchaser) that is a Broker-Dealer and elects to exchange for New
Securities any Securities that it acquired for its own account as a result of
market-making activities or other trading activities (but not directly from the
Company or any Affiliate of the Company).

                  "Final Memorandum" shall have the meaning set forth in the
Purchase Agreement.

                  "Guarantees" shall have the meaning set forth in the preamble
hereto.

                  "Holder" and "Holders" shall have the respective meanings set
forth in the preamble hereto.

                  "Indenture" shall mean the Indenture relating to the
Securities, dated as of February 7, 2003, among the Company, the Subsidiary
Guarantors and National City Bank, as the Trustee, as the same may be amended
from time to time in accordance with the terms thereof.



                                       2






                  "Initial Placement" shall have the meaning set forth in the
preamble hereto.

                  "Initial Purchasers" shall have the meaning set forth in the
preamble hereto.

                  "Losses" shall have the meaning set forth in Section 7(d)
hereof.

                  "Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of Securities registered or to be registered under a
Registration Statement.

                  "Managing Underwriters" shall mean the investment banker or
investment bankers and manager or managers that shall administer an underwritten
offering.

                  "New Securities" shall mean the 7 5/8% Senior Notes due 2013
issued by the Company containing terms identical in all material respects to,
and evidencing the same indebtedness as, the Securities (except that (i)
interest thereon shall accrue from the last date on which interest was paid on
the Securities or, if no such interest has been paid, from the date of their
original issue, (ii) the transfer restrictions thereon shall be eliminated and
(iii) certain provisions relating to an increase in the rate of interest thereon
shall be eliminated), to be offered to Holders in exchange for Securities
pursuant to the Registered Exchange Offer.

                  "Notes" shall have the meaning set forth in the preamble
hereto.

                  "Prospectus" shall mean the prospectus included in any
Registration Statement (including, without limitation, a prospectus that
discloses information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A under the Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Securities or the New Securities covered
by such Registration Statement, and all amendments and supplements thereto and
all material incorporated by reference therein.

                  "Purchase Agreement" shall have the meaning set forth in the
preamble hereto.


                  "Registered Exchange Offer" shall mean the proposed offer of
the Company and the Guarantors to issue and deliver to the Holders that are not
prohibited by any law or policy of the Commission from participating in such
offer, in exchange for the Securities, a like aggregate principal amount of the
New Securities.

                  "Registration Statement" shall mean any Exchange Offer
Registration Statement or Shelf Registration Statement that covers any of the
Securities or the New Securities pursuant to the provisions of this Agreement,
any amendments and supplements to such registration statement, including
post-effective amendments (in each case including the Prospectus contained
therein), all exhibits thereto and all material incorporated by reference
therein.

                  "Securities" shall have the meaning set forth in the preamble
hereto.

                  "Shelf Registration" shall mean a registration effected
pursuant to Section 3 hereof.



                                       3





                  "Shelf Registration Period" has the meaning set forth in
Section 3(b)(ii) hereof.

                  "Shelf Registration Statement" shall mean a "shelf"
registration statement of the Company and the Subsidiary Guarantors pursuant to
the provisions of Section 3 hereof which covers some or all of the Securities or
New Securities, as applicable, on an appropriate form under Rule 415 under the
Act, or any similar rule that may be adopted by the Commission, amendments and
supplements to such registration statement, including post-effective amendments,
in each case including the Prospectus contained therein, all exhibits thereto
and all material incorporated by reference therein.

                  "Subsidiary Guarantors" shall have the meaning set forth in
the preamble hereto.

                  "Trustee" shall mean the trustee with respect to the
Securities under the Indenture.

                  "underwriter" shall mean any underwriter of the Securities in
connection with an offering thereof under a Shelf Registration Statement.

                  2.   REGISTERED EXCHANGE OFFER.

                       (a)   The Company shall prepare and, not later than 45
          days following the date of the original issuance of the Securities (or
          if such 45th day is not a Business Day, the next succeeding Business
          Day), shall file with the Commission the Exchange Offer Registration
          Statement with respect to the Registered Exchange Offer. The Company
          shall use its best efforts to cause the Exchange Offer Registration
          Statement to be declared effective under the Act within 120 days of
          the date of the original issuance of the Securities (or if such 120th
          day is not a Business Day, the next succeeding Business Day).

                       (b)   Upon the effectiveness of the Exchange Offer
          Registration Statement, the Company shall promptly commence the
          Registered Exchange Offer, it being the objective of such Registered
          Exchange Offer to enable each Holder electing to exchange Securities
          for New Securities (assuming that such Holder is not an Affiliate of
          the Company, acquires the New Securities in the ordinary course of
          such Holder's business, has no arrangements with any Person to
          participate in the distribution of the New Securities and is not
          prohibited by any law or policy of the Commission from participating
          in the Registered Exchange Offer) to trade such New Securities from
          and after their receipt without any limitations or restrictions under
          the Act and without material restrictions under the securities laws of
          a substantial proportion of the several states of the United States.

                       (c)   In connection with the Registered Exchange Offer,
          the Company shall:

                             (i)   mail to each Holder a copy of the Prospectus
                    forming part of the Exchange Offer Registration Statement,
                    together with an appropriate letter of transmittal and
                    related documents;


                                       4




                             (ii)  keep the Registered Exchange Offer open for
                    not less than 30 days and not more than 45 days after the
                    date notice thereof is mailed to the Holders (or, in each
                    case, longer if required by applicable law);

                             (iii) use its best efforts to keep the Exchange
                    Offer Registration Statement continuously effective under
                    the Act, supplemented and amended as required under the Act,
                    to ensure that it is available for sales of New Securities
                    by Exchanging Dealers during the Exchange Offer Registration
                    Period;

                             (iv)  utilize the services of a depositary for the
                    Registered Exchange Offer with an address in the Borough of
                    Manhattan in New York City, which may be the Trustee or its
                    Affiliate;

                             (v)   permit Holders to withdraw tendered
                    Securities at any time prior to the close of business, New
                    York time, on the last Business Day on which the Registered
                    Exchange Offer is open;

                             (vi)  prior to effectiveness of the Exchange Offer
                    Registration Statement, if requested by the Commission,
                    provide a supplemental letter to the Commission (A) stating
                    that the Company and the Subsidiary Guarantors are
                    conducting the Registered Exchange Offer in reliance on the
                    position of the Commission in EXXON CAPITAL HOLDINGS
                    CORPORATION (pub. avail. May 13, 1988) and MORGAN STANLEY
                    AND CO., INC. (pub. avail. June 5, 1991); and (B) including
                    a representation that neither the Company nor any Subsidiary
                    Guarantor has entered into any arrangement or understanding
                    with any Person to distribute the New Securities to be
                    received in the Registered Exchange Offer and that neither
                    the Company nor any Subsidiary Guarantor will issue New
                    Securities to any Holder participating in the Registered
                    Exchange Offer who fails to certify to the Company that such
                    Holder is acquiring the New Securities in the ordinary
                    course of business and has no arrangement or understanding
                    with any Person to participate in the distribution of the
                    New Securities; and

                             (vii) comply in all respects with all applicable
                    laws.

                       (d)   As soon as practicable after the close of the
          Registered Exchange Offer, the Company and the Subsidiary Guarantors
          shall:

                             (i)   accept for exchange all Securities tendered
                    and not validly withdrawn pursuant to the Registered
                    Exchange Offer;

                             (ii)  deliver to the Trustee for cancellation in
                    accordance with Section 5(s) hereof all Securities so
                    accepted for exchange; and

                             (iii) cause the Trustee promptly to authenticate
                    and deliver to each Holder a principal amount of New
                    Securities equal to the principal amount of the Securities
                    of such Holder so accepted for exchange.


                                       5





                       (e)   With respect to any resales of New Securities
          obtained by a Holder in exchange for Securities acquired by such
          Holder directly from the Company or one of its Affiliates, each Holder
          hereby acknowledges and agrees that any Broker-Dealer and any such
          Holder using the Registered Exchange Offer to participate in a
          distribution of the New Securities, (x) could not under Commission
          policy as in effect on the date of this Agreement rely on the position
          of the Commission in MORGAN STANLEY AND CO., INC. (pub. avail. June 5,
          1991) and EXXON CAPITAL HOLDINGS CORPORATION (pub. avail. May 13,
          1988), as interpreted in the Commission's letter to Shearman &
          Sterling dated July 2, 1993 and similar no-action letters; and (y)
          must comply with the registration and prospectus delivery requirements
          of the Act in connection with any secondary resale transaction that
          must be covered by an effective registration statement containing the
          selling security holder information required by Item 507 or 508, as
          applicable, of Regulation S-K under the Act. Accordingly, each Holder
          participating in the Registered Exchange Offer shall be required to
          represent in writing to the Company that, at the time of the
          consummation of the Registered Exchange Offer:

                             (i)   any New Securities received by such Holder
                    will be acquired in the ordinary course of business;

                             (ii)  such Holder has had and will have no
                    arrangement or understanding with any Person to participate
                    in the distribution of the Securities or the New Securities
                    within the meaning of the Act; and

                             (iii) such Holder is not an Affiliate of the
                    Company or any of the Subsidiary Guarantors (or if it is
                    such an Affiliate, that it will comply with the registration
                    and prospectus delivery requirements of the Act to the
                    extent applicable).

                       (f)   If any Initial Purchaser determines that it is not
          eligible to participate in the Registered Exchange Offer with respect
          to the exchange of Securities constituting any portion of an unsold
          allotment, at the request of such Initial Purchaser, the Company and
          the Subsidiary Guarantors shall issue and deliver to such Initial
          Purchaser or the Person purchasing New Securities registered under a
          Shelf Registration Statement as contemplated by Section 3 hereof from
          such Initial Purchaser, in exchange for such Securities, a like
          principal amount of New Securities. The Company shall use its best
          efforts to cause the CUSIP Service Bureau to issue the same CUSIP
          number for such New Securities as for New Securities issued pursuant
          to the Registered Exchange Offer.

                  3.   SHELF REGISTRATION.

                       (a)   If (i) due to any change in law or applicable
          interpretations thereof by the Commission's staff, the Company
          determines upon advice of its outside counsel that it or any
          Subsidiary Guarantor is not permitted to effect the Registered
          Exchange Offer as contemplated by Section 2 hereof; or (ii) for any
          other reason the Exchange Offer Registration Statement is not declared
          effective by the Commission under the Act within 120 days of the date
          of the original issuance of the Securities (or if such 120th day is
          not a Business Day, the next succeeding Business Day) or the
          Registered Exchange


                                       6




          Offer is not consummated within 150 days of the date hereof (or if
          such 150th day is not a Business Day, the next succeeding Business
          Day); (iii) any Initial Purchaser so requests with respect to
          Securities that are not eligible to be exchanged for New Securities in
          the Registered Exchange Offer and that are held by it following
          consummation of the Registered Exchange Offer; (iv) any Holder (other
          than an Initial Purchaser) is not eligible to participate in the
          Registered Exchange Offer or does not receive freely tradeable New
          Securities in the Registered Exchange Offer, other than by reason of
          such Holder being an Affiliate of the Company and the Subsidiary
          Guarantors (it being understood that the requirement that a
          participating Broker-Dealer deliver the prospectus contained in the
          Exchange Offer Registration Statement in connection with sales of New
          Securities shall not result in such New Securities being not "freely
          tradable"); or (v) in the case of any Initial Purchaser that
          participates in the Registered Exchange Offer or acquires New
          Securities pursuant to Section 2(f) hereof, such Initial Purchaser
          does not receive freely tradeable New Securities in exchange for
          Securities constituting any portion of an unsold allotment, other than
          by reason of such Holder being an Affiliate of the Company (it being
          understood that (x) the requirement that an Initial Purchaser deliver
          a Prospectus containing the information required by Item 507 or 508 of
          Regulation S-K under the Act in connection with sales of New
          Securities acquired in exchange for such Securities shall not result
          in such New Securities being not "freely tradeable;" and (y) the
          requirement that an Exchanging Dealer deliver a Prospectus in
          connection with sales of New Securities acquired in the Registered
          Exchange Offer in exchange for Securities acquired as a result of
          market-making activities or other trading activities shall not result
          in such New Securities being not "freely tradeable"), the Company
          shall effect, at its cost, a Shelf Registration Statement in
          accordance with subsection (b) below.

                       (b)   (i)  The Company shall as promptly as practicable
          (but in no event more than 45 days after so required or requested
          pursuant to this Section 3, or if such 45th day is not a Business Day,
          the next succeeding Business Day), file with the Commission and
          thereafter shall use its best efforts to cause to be declared
          effective under the Act a Shelf Registration Statement relating to the
          offer and sale of the Securities or the New Securities, as applicable,
          by the Holders thereof from time to time in accordance with the
          methods of distribution elected by such Holders and set forth in such
          Shelf Registration Statement; PROVIDED, HOWEVER, that no Holder (other
          than an Initial Purchaser) shall be entitled to have the Securities
          held by it covered by such Shelf Registration Statement unless such
          Holder agrees in writing to be bound by all of the provisions of this
          Agreement applicable to such Holder; and PROVIDED FURTHER, that with
          respect to New Securities received by an Initial Purchaser in exchange
          for Securities constituting any portion of an unsold allotment, the
          Company may, if permitted by current interpretations by the
          Commission's staff, file a post-effective amendment to the Exchange
          Offer Registration Statement containing the information required by
          Item 507 or 508 of Regulation S-K, as applicable, in satisfaction of
          its obligations under this subsection with respect thereto, and any
          such Exchange Offer Registration Statement, as so amended, shall be
          referred to herein as, and governed by the provisions herein
          applicable to, a Shelf Registration Statement.


                                       7




                             (ii)  The Company shall use its best efforts to
                    keep the Shelf Registration Statement continuously
                    effective, supplemented and amended as required by the Act,
                    in order to permit the Prospectus forming part thereof to be
                    usable by Holders for a period of two years from the date
                    the Shelf Registration Statement is declared effective by
                    the Commission (or for such longer period if extended
                    pursuant to Section 5(k) hereof) or such shorter period that
                    will terminate when all the Securities or New Securities, as
                    applicable, covered by the Shelf Registration Statement have
                    been sold pursuant to the Shelf Registration Statement (in
                    any such case, such period being called the "Shelf
                    Registration Period"). The Company shall be deemed not to
                    have used its best efforts to keep the Shelf Registration
                    Statement effective during the requisite period if it
                    voluntarily takes any action that would result in Holders of
                    Securities covered thereby not being able to offer and sell
                    such Securities during that period, unless (A) such action
                    is required by applicable law; or (B) such action is taken
                    by the Company in good faith and for valid business reasons
                    (not including avoidance of the Company's obligations
                    hereunder), including the acquisition or divestiture of
                    assets (to the extent permitted by the terms of the
                    Indenture), so long as the Company promptly thereafter
                    complies with the requirements of Section 5(k) hereof, if
                    applicable.

                             (iii) The Company shall cause the Shelf
                    Registration Statement and the related Prospectus and any
                    amendment or supplement thereto, as of the effective date of
                    the Shelf Registration Statement or such amendment or
                    supplement, (A) to comply in all material respects with the
                    applicable requirements of the Act; and (B) not to contain
                    any untrue statement of a material fact or omit to state a
                    material fact required to be stated therein or necessary in
                    order to make the statements therein, in the light of the
                    circumstances under which they were made, not misleading.

                  4.   SPECIAL INTEREST. If (a) on or prior to the 45th day
following the original issue date of the Securities (or if such 45th day is not
a Business Day, the next succeeding Business Day), neither the Exchange Offer
Registration Statement nor the Shelf Registration Statement has been filed with
the Commission, (b) on or prior to the 120th day following the original issue
date of the Securities (or if such 120th day is not a Business Day, the next
succeeding Business Day), neither the Exchange Offer nor the Shelf Registration
Statement has been declared effective by the Commission, (c) on or prior to the
150th day following the original issue date of the Securities (or if such 150th
day is not a Business Day the next succeeding Business Day), neither has the
Exchange Offer Registration Statement been consummated nor had the Shelf
Registration Statement been declared effective, or (d) after either the Exchange
Offer Registration Statement or the Shelf Registration Statement has been
declared effective, such Registration Statement thereafter ceases to be
effective or usable in connection with resales of Securities or New Securities
in accordance with and during the periods specified in this Agreement, unless,
in the case of this clause (d), a Shelf Registration Statement or its related
Prospectus ceases to be effective or usable solely as a result of the occurrence
of material events with respect to the Company and/or the Subsidiary Guarantors
that would be required by law to be described in such Shelf Registration
Statement or the related Prospectus, PROVIDED that the Company shall promptly
and in good faith amend or supplement such Shelf Registration



                                       8





Statement and the related Prospectus to describe such events, (each such event
referred to in clauses (a) through (d), a "Registration Default"), then interest
("Special Interest") shall accrue on the principal amount of the Securities and
the New Securities (in addition to the special interest on the Securities and
New Securities) from and including the date on which any such Registration
Default shall have occurred to but excluding the date on which all Registration
Defaults have been cured. Special Interest shall accrue at a rate of 0.25% per
annum during the 90-day period immediately following the occurrence of such
Registration Default and shall increase by 0.25% per annum at the end of each
subsequent 90-day period, but in no event shall such rate exceed 1.00% per
annum.

                  All obligations of the Company and the Subsidiary Guarantors
set forth in the preceding paragraph that are outstanding with respect to any
Security at the time such Security is exchanged for a New Security shall survive
until such time as all such obligations with respect to such Security have been
satisfied in full.

                  5.   ADDITIONAL REGISTRATION PROCEDURES. In connection with
any Shelf Registration Statement and, to the extent applicable, any Exchange
Offer Registration Statement, the following provisions shall apply.

                       (a)   The Company shall:

                             (i)   furnish to you, prior to the filing thereof
                    with the Commission, a copy of any Exchange Offer
                    Registration Statement and any Shelf Registration Statement,
                    and each amendment thereof and each amendment or supplement,
                    if any, to the Prospectus included therein (including, upon
                    request, all documents incorporated by reference therein
                    after the initial filing) and shall use its best efforts to
                    reflect in each such document, when so filed with the
                    Commission, such comments as you reasonably propose;

                             (ii)  include the information set forth in Annex A
                    hereto on the facing page of the Exchange Offer Registration
                    Statement, in Annex B hereto in the forepart of the Exchange
                    Offer Registration Statement in a section setting forth
                    details of the Exchange Offer, in Annex C hereto in the
                    underwriting or plan of distribution section of the
                    Prospectus contained in the Exchange Offer Registration
                    Statement, and in Annex D hereto in the letter of
                    transmittal delivered pursuant to the Registered Exchange
                    Offer;

                             (iii) if requested by an Initial Purchaser, include
                    the information required by Item 507 or 508 of Regulation
                    S-K, as applicable, in the Prospectus contained in the
                    Exchange Offer Registration Statement; and

                             (iv)  in the case of a Shelf Registration
                    Statement, include the names of the Holders that propose to
                    sell Securities pursuant to the Shelf Registration Statement
                    as selling securityholders.



                                       9





                       (b)   The Company shall ensure that:

                             (i)   any Registration Statement and any amendment
                    thereto and any Prospectus forming part thereof and any
                    amendment or supplement thereto complies in all material
                    respects with the Act and the rules and regulations
                    thereunder; and

                             (ii)  any Registration Statement and any amendment
                    thereto and any Prospectus forming part thereof and any
                    amendment or supplement thereto does not, when the
                    Registration Statement becomes effective, contain an untrue
                    statement of a material fact or omit to state a material
                    fact required to be stated therein or necessary to make the
                    statements therein (in the case of the Prospectus, in the
                    light of the circumstances under which they were made) not
                    misleading.

                       (c)   The Company shall advise you, the Holders of
          Securities covered by any Shelf Registration Statement and any
          Exchanging Dealer under any Exchange Offer Registration Statement that
          has provided in writing to the Company a telephone or facsimile number
          and address for notices, and, if requested by you or any such Holder
          or Exchanging Dealer, shall confirm such advice in writing (which
          notice pursuant to clauses (ii) through (v) hereof shall be
          accompanied by an instruction to suspend the use of the Prospectus
          until the Company shall have remedied the basis for such suspension):

                             (i)   when a Registration Statement or any
                    amendment thereto has been filed with the Commission and
                    when the Registration Statement or any post-effective
                    amendment thereto has become effective;

                             (ii)  of any request by the Commission for any
                    amendment or supplement to the Registration Statement or the
                    Prospectus or for additional information;

                             (iii) of the issuance by the Commission of any stop
                    order suspending the effectiveness of the Registration
                    Statement or the initiation of any proceedings for that
                    purpose;

                             (iv)  of the receipt by the Company or the
                    Subsidiary Guarantors of any notification with respect to
                    the suspension of the qualification of the Securities or the
                    New Securities, as the case may be, included therein for
                    sale in any jurisdiction or the initiation of any proceeding
                    for such purpose; and

                             (v)   of the happening of any event that requires
                    any change in the Registration Statement or the Prospectus
                    so that, as of such date, the Registration Statement or the
                    Prospectus does not contain an untrue statement of a
                    material fact and does not omit to state a material fact
                    required to be stated therein or necessary to make the
                    statements therein (in the case of the Prospectus, in the
                    light of the circumstances under which they were made) not
                    misleading.

                       (d)   The Company shall make every reasonable effort to
          obtain the withdrawal of any order suspending the effectiveness of any
          Registration Statement or


                                       10




          the qualification of the securities therein for sale in any
          jurisdiction at the earliest possible time.

                       (e)   The Company shall furnish to each Holder of
          Securities or New Securities covered by any Shelf Registration
          Statement, without charge, at least one copy of such Shelf
          Registration Statement and any post-effective amendment thereto,
          including all material incorporated therein by reference, and, if the
          Holder so requests in writing, all exhibits thereto (including
          exhibits incorporated by reference therein).

                       (f)   The Company shall, during the Shelf Registration
          Period, deliver to each Holder of Securities or New Securities covered
          by any Shelf Registration Statement, without charge, as many copies of
          the Prospectus (including each preliminary Prospectus) included in
          such Shelf Registration Statement and any amendment or supplement
          thereto as such Holder may reasonably request. The Company and the
          Subsidiary Guarantors consent to the use of the Prospectus or any
          amendment or supplement thereto by each of the selling Holders of
          Securities or New Securities in connection with the offering and sale
          of the Securities or New Securities covered by the Prospectus, or any
          amendment or supplement thereto, included in the Shelf Registration
          Statement.

                       (g)   The Company shall furnish to each Exchanging Dealer
          which so requests, without charge, at least one copy of the Exchange
          Offer Registration Statement and any post-effective amendment thereto,
          including all material incorporated by reference therein, and, if the
          Exchanging Dealer so requests in writing, all exhibits thereto
          (including exhibits incorporated by reference therein).

                       (h)   The Company shall promptly deliver to each Initial
          Purchaser, each Exchanging Dealer and each other Person required to
          deliver a Prospectus during the Exchange Offer Registration Period,
          without charge, as many copies of the final Prospectus included in
          such Exchange Offer Registration Statement and any amendment or
          supplement thereto as any such Person may reasonably request. The
          Company and the Subsidiary Guarantors consent to the use of the
          Prospectus or any amendment or supplement thereto by any Initial
          Purchaser, any Exchanging Dealer and any such other Person that may be
          required to deliver a Prospectus following the Registered Exchange
          Offer in connection with the offering and sale of the New Securities
          covered by the Prospectus, or any amendment or supplement thereto,
          included in the Exchange Offer Registration Statement.

                       (i)   Prior to the Registered Exchange Offer or any
          other offering of Securities or New Securities pursuant to any
          Registration Statement, the Company and the Subsidiary Guarantors
          shall arrange, if necessary, for the qualification of the Securities
          or the New Securities for sale under the state securities or blue sky
          laws of such jurisdictions in the United States as any Holder shall
          reasonably request and will maintain such qualification in effect so
          long as required; PROVIDED that in no event shall either the Company
          or any Subsidiary Guarantor be obligated to qualify to do business or
          as a dealer in securities in any jurisdiction where it is not then so
          qualified or to take any action that would subject it to service of
          process in suits or taxation, other than suits


                                       11





          arising out of the Initial Placement, the Registered Exchange Offer or
          any offering pursuant to a Shelf Registration Statement, in any such
          jurisdiction where it is not then so subject.

                       (j)   The Company and the Subsidiary Guarantors shall
          cooperate with the Holders to facilitate the timely preparation and
          delivery of certificates representing New Securities or Securities to
          be issued or sold pursuant to any Registration Statement free of any
          restrictive legends and in such denominations and registered in such
          names as Holders may request.

                       (k)   Upon the occurrence of any event contemplated by
          subsections (c)(ii) through (v) above during any period of time in
          which the Company is required to maintain an effective Registration
          Statement, the Company shall promptly prepare a post-effective
          amendment to the applicable Registration Statement or an amendment or
          supplement to the related Prospectus or file any other required
          document so that, as thereafter delivered to initial purchasers of the
          securities included therein, the Prospectus shall not include an
          untrue statement of a material fact or omit to state any material fact
          necessary to make the statements therein, in the light of the
          circumstances under which they were made, not misleading. In such
          circumstances, the period of effectiveness of the Exchange Offer
          Registration Statement provided for in Section 2 and the Shelf
          Registration Statement provided for in Section 3(b) shall each be
          extended by the number of days from and including the date of the
          giving of a notice of suspension pursuant to Section 5(c) hereof to
          and including the date when the Initial Purchasers, the Holders of the
          Securities and any known Exchanging Dealer shall have received such
          amended or supplemented Prospectus pursuant to this Section 5(k).

                       (l)   Not later than the effective date of any
          Registration Statement, the Company shall provide a CUSIP number for
          the Securities or the New Securities, as the case may be, registered
          under such Registration Statement and provide the Trustee with printed
          certificates for such Securities or New Securities, as the case may
          be, in a form eligible for deposit with The Depository Trust Company.

                       (m)   The Company and the Subsidiary Guarantors shall
          comply with all applicable rules and regulations of the Commission and
          shall make generally available to their security holders no later than
          45 days after the end of the 12-month period (or 90 days if such
          period is a fiscal year) beginning with the first month of the
          Company's first fiscal quarter after the effective date of the
          applicable Registration Statement, an earnings statement satisfying
          the provisions of Section 11(a) of the Act.

                       (n)   The Company shall cause the Indenture to be
          qualified under the Trust Indenture Act in a timely manner.

                       (o)   The Company may require each Holder of Securities
          or New Securities to be sold pursuant to any Shelf Registration
          Statement to furnish to the Company such information regarding the
          Holder and the distribution of such Securities or New Securities as
          the Company may from time to time reasonably require for inclusion in
          such Shelf Registration Statement. The Company may exclude from such
          Shelf


                                       12





          Registration Statement the Securities or New Securities of any Holder
          that unreasonably fails to furnish such information within a
          reasonable time after receiving such request.

                       (p)   In the case of any Shelf Registration Statement,
          the Company and the Subsidiary Guarantors shall enter into such
          agreements and take all other appropriate actions (including if
          requested an underwriting agreement in customary form) in order to
          expedite or facilitate the registration or the disposition of the
          Securities or New Securities, and in connection therewith, if an
          underwriting agreement is entered into, cause the same to contain
          indemnification provisions and procedures no less favorable than those
          set forth in Section 7 (or such other provisions and procedures
          acceptable to the Majority Holders and the Managing Underwriters, if
          any) with respect to all parties to be indemnified pursuant to Section
          7.

                       (q)   In the case of any Shelf Registration Statement,
          the Company and the Subsidiary Guarantors shall:

                             (i)   make reasonably available for inspection by
                    the Holders of Securities or New Securities to be registered
                    thereunder, any underwriter participating in any disposition
                    pursuant to such Shelf Registration Statement, and any
                    attorney, accountant or other agent retained by the Holders
                    or any such underwriter all relevant financial and other
                    records, pertinent corporate documents and properties of the
                    Company and its subsidiaries; PROVIDED, HOWEVER, that the
                    foregoing inspection and information gathering shall be
                    coordinated on behalf of the Holders by the one firm or
                    counsel designated by the Majority Holders pursuant to
                    Section 6 hereof; PROVIDED, FURTHER, that any information
                    that is designated in writing by the Company or any
                    Subsidiary Guarantor, in good faith, as confidential at the
                    time of delivery of such information shall be kept
                    confidential by the Holders or any such underwriter,
                    attorney, accountant or agent, unless such disclosure is
                    made in connection with a court proceeding or required by
                    law, or such information becomes available to the public
                    generally or through a third party without an accompanying
                    obligation of confidentiality;

                             (ii)  cause the Company's and the Subsidiary
                    Guarantors' officers, directors and employees to supply all
                    relevant information reasonably requested by the Holders or
                    any underwriter, attorney, accountant or agent in connection
                    with any such Shelf Registration Statement as is customary
                    for similar due diligence examinations; PROVIDED, HOWEVER,
                    that the foregoing inspection and information gathering
                    shall be coordinated on behalf of the Holders by the one
                    firm or counsel designated by the Majority Holders pursuant
                    to Section 6 hereof; PROVIDED, FURTHER, that any information
                    that is designated in writing by the Company or any
                    Subsidiary Guarantor, in good faith, as confidential at the
                    time of delivery of such information shall be kept
                    confidential by the Holders or any such underwriter,
                    attorney, accountant or agent, unless such disclosure is
                    made in connection with a court proceeding or required by
                    law, or such information becomes available to the public
                    generally or through a third party without an accompanying
                    obligation of confidentiality;


                                       13





                             (iii) make such representations and warranties to
                    the Holders of Securities or New Securities registered
                    thereunder and the underwriters, if any, in form, substance
                    and scope as are customarily made by issuers to underwriters
                    in primary underwritten offerings and covering matters
                    including, but not limited to, those set forth in the
                    Purchase Agreement;

                             (iv)  obtain opinions of counsel to the Company and
                    updates thereof (which counsel and opinions (in form, scope
                    and substance) shall be reasonably satisfactory to the
                    Managing Underwriters, if any) addressed to each selling
                    Holder and the underwriters, if any, covering such matters
                    as are customarily covered in opinions requested in
                    underwritten offerings and such other matters as may be
                    reasonably requested by such Holders and underwriters;

                             (v)   obtain "cold comfort" letters and updates
                    thereof from the independent certified public accountants of
                    the Company (and, if necessary, any other independent
                    certified public accountants of any subsidiary of the
                    Company or of any business acquired by the Company for which
                    financial statements and financial data are, or are required
                    to be, included in such Shelf Registration Statement),
                    addressed to each selling Holder of Securities or New
                    Securities registered thereunder and the underwriters, if
                    any, in customary form and covering matters of the type
                    customarily covered in "cold comfort" letters in connection
                    with primary underwritten offerings; and

                             (vi)  deliver such documents and certificates as
                    may be reasonably requested by the Majority Holders and the
                    Managing Underwriters, if any, including those to evidence
                    compliance with Section 5(k) and with any customary
                    conditions contained in the underwriting agreement or other
                    agreement entered into by the Company and the Subsidiary
                    Guarantors.

The actions set forth in clauses (iii), (iv), (v) and (vi) of this Section 5(q)
shall be performed at (A) the effectiveness of such Registration Statement and
each post-effective amendment thereto; and (B) each closing under any
underwriting or similar agreement as and to the extent required thereunder.

                       (r)   In the case of any Exchange Offer Registration
          Statement, the Company and the Subsidiary Guarantors shall:

                             (i)   make reasonably available for inspection by
                    any Initial Purchaser, and any attorney, accountant or other
                    agent retained by such Initial Purchaser, all relevant
                    financial and other records, pertinent corporate documents
                    and properties of the Company and its subsidiaries;
                    PROVIDED, HOWEVER, that the foregoing inspection and
                    information gathering shall be coordinated on behalf of the
                    Initial Purchasers by the one firm or counsel designated by
                    Salomon Smith Barney Inc. pursuant to Section 6 hereof;
                    PROVIDED, FURTHER, that any information that is designated
                    in writing by the Company or any Subsidiary Guarantor, in
                    good faith, as confidential at the time of delivery of such
                    information shall be kept confidential by such Initial
                    Purchaser or any such attorney, accountant or agent,



                                       14





                    unless such disclosure is made in connection with a court
                    proceeding or required by law, or such information becomes
                    available to the public generally or through a third party
                    without an accompanying obligation of confidentiality;

                             (ii)  cause the Company and the Subsidiary
                    Guarantors' officers, directors and employees to supply all
                    relevant information reasonably requested by such Initial
                    Purchaser or any such attorney, accountant or agent in
                    connection with any such Exchange Offer Registration
                    Statement as is customary for similar due diligence
                    examinations; PROVIDED, HOWEVER, that the foregoing
                    inspection and information gathering shall be coordinated on
                    behalf of the Initial Purchasers by the one counsel or firm
                    designated by Salomon Smith Barney Inc. pursuant to Section
                    6 hereof; PROVIDED, FURTHER, that any information that is
                    designated in writing by the Company or any Subsidiary
                    Guarantor, in good faith, as confidential at the time of
                    delivery of such information shall be kept confidential by
                    such Initial Purchaser or any such attorney, accountant or
                    agent, unless such disclosure is made in connection with a
                    court proceeding or required by law, or such information
                    becomes available to the public generally or through a third
                    party without an accompanying obligation of confidentiality;

                             (iii) make such representations and warranties to
                    such Initial Purchaser, in form, substance and scope as are
                    customarily made by issuers to underwriters in primary
                    underwritten offerings and covering matters including, but
                    not limited to, those set forth in the Purchase Agreement;

                             (iv)  obtain opinions of counsel to the Company or
                    any Subsidiary Guarantor and updates thereof (which counsel
                    and opinions (in form, scope and substance) shall be
                    reasonably satisfactory to such Initial Purchaser and its
                    counsel), addressed to such Initial Purchaser, covering such
                    matters as are customarily covered in opinions requested in
                    underwritten offerings and such other matters as may be
                    reasonably requested by such Initial Purchaser or its
                    counsel;

                             (v)   obtain "cold comfort" letters and updates
                    thereof from the independent certified public accountants of
                    the Company (and, if necessary, any other independent
                    certified public accountants of any subsidiary of the
                    Company or of any business acquired by the Company for which
                    financial statements and financial data are, or are required
                    to be, included in such Exchange Offer Registration
                    Statement), addressed to such Initial Purchaser, in
                    customary form and covering matters of the type customarily
                    covered in "cold comfort" letters in connection with primary
                    underwritten offerings, or if requested by such Initial
                    Purchaser or its counsel in lieu of a "cold comfort" letter,
                    an agreed-upon procedures letter under Statement on Auditing
                    Standards No. 35, covering matters requested by such Initial
                    Purchaser or its counsel; and

                             (vi)  deliver such documents and certificates as
                    may be reasonably requested by such Initial Purchaser or its
                    counsel, including those to


                                       15




                    evidence compliance with Section 5(k) and with conditions
                    customarily contained in underwriting agreements.

The foregoing actions set forth in clauses (iii), (iv), (v), and (vi) of this
Section 5(r) shall be performed at the close of the Registered Exchange Offer
and the effective date of any post-effective amendment to the Exchange Offer
Registration Statement.

                       (s)   If a Registered Exchange Offer is to be
          consummated, upon delivery of the Securities by Holders to the Company
          (or to such other Person as directed by the Company) in exchange for
          the New Securities, the Company shall mark, or caused to be marked, on
          the Securities so exchanged that such Securities are being canceled in
          exchange for the New Securities. In no event shall the Securities be
          marked as paid or otherwise satisfied.

                       (t)   The Company and the Subsidiary Guarantors shall
          use their respective best efforts (i) if the Securities have been
          rated prior to the initial sale of such Securities, to confirm such
          ratings will apply to the Securities or the New Securities, as the
          case may be, covered by a Registration Statement; or (ii) if the
          Securities were not previously rated, to cause the Securities or the
          New Securities covered by a Registration Statement to be rated with at
          least one nationally recognized statistical rating agency, if so
          requested by Majority Holders with respect to the related Registration
          Statement or by any Managing Underwriters.

                       (u)   In the event that any Broker-Dealer shall
          underwrite any Securities or participate as a member of an
          underwriting syndicate or selling group or "assist in the
          distribution" (within the meaning of the Rules of Fair Practice and
          the By-Laws of the National Association of Securities Dealers, Inc.)
          thereof, whether as a Holder of such Securities or as an underwriter,
          a placement or sales agent or a broker or dealer in respect thereof,
          or otherwise, the Company and the Subsidiary Guarantors shall assist
          such Broker-Dealer in complying with the requirements of such Rules
          and By-Laws, including, without limitation, by:

                             (i)   if such Rules or By-Laws shall so require,
                    engaging a "qualified independent underwriter" (as defined
                    in such Rules) to participate in the preparation of the
                    Registration Statement, to exercise usual standards of due
                    diligence with respect thereto and, if any portion of the
                    offering contemplated by such Registration Statement is an
                    underwritten offering or is made through a placement or
                    sales agent, to recommend the yield of such Securities;

                             (ii)  indemnifying any such qualified independent
                    underwriter to the extent of the indemnification of
                    underwriters provided in Section 7 hereof; and

                             (iii) providing such information to such
                    Broker-Dealer as may be required in order for such
                    Broker-Dealer to comply with the requirements of such Rules.



                                       16




                             (v)   The Company and the Subsidiary Guarantors
                    shall use their respective best efforts to take all other
                    steps necessary to effect the registration of the Securities
                    or the New Securities, as the case may be, covered by a
                    Registration Statement.

                       6.    REGISTRATION EXPENSES. The Company shall bear all
expenses incurred in connection with the performance of its and the Subsidiary
Guarantors' obligations under Sections 2, 3 and 5 hereof , including filing
fees, if any, in respect of the trade of the New Securities by way of private
placement to those Holders in Canada, and, in the event of any Shelf
Registration Statement, will reimburse the Holders for the reasonable fees and
disbursements of one firm or counsel designated by the Majority Holders to act
as counsel for the Holders in connection therewith, and, in the case of any
Exchange Offer Registration Statement, will reimburse the Initial Purchasers for
the reasonable fees and disbursements of one firm or counsel designated by
Salomon Smith Barney Inc. to act as counsel for the Initial Purchasers in
connection therewith.

                       7.    INDEMNIFICATION AND CONTRIBUTION.

                             (a)   The Company and the Subsidiary Guarantors,
          jointly and severally, agree to indemnify and hold harmless each
          Holder of Securities or New Securities, as the case may be, covered by
          any Registration Statement (including each Initial Purchaser and, with
          respect to any Prospectus delivery as contemplated in Section 5(h)
          hereof, each Exchanging Dealer), the directors, officers, employees
          and agents of each such Holder and each Person who controls any such
          Holder within the meaning of either the Act or the Exchange Act
          against any and all losses, claims, damages or liabilities, joint or
          several, to which they or any of them may become subject under the
          Act, the Exchange Act or other Federal or state statutory law or
          regulation, at common law or otherwise, insofar as such losses,
          claims, damages or liabilities (or actions in respect thereof) arise
          out of or are based upon any untrue statement or alleged untrue
          statement of a material fact contained in the Registration Statement
          as originally filed or in any amendment thereof, or in any preliminary
          Prospectus or the Prospectus, or in any amendment thereof or
          supplement thereto or in any "wrapped" version thereof constituting an
          offering memorandum under applicable Canadian provincial securities
          legislation, or arise out of or are based upon the omission or alleged
          omission to state therein a material fact required to be stated
          therein or necessary to make the statements therein not misleading,
          and agrees to reimburse each such indemnified party, as incurred, for
          any legal or other expenses reasonably incurred by them in connection
          with investigating or defending any such loss, claim, damage,
          liability or action; PROVIDED, HOWEVER, that (i) the Company and the
          Subsidiary Guarantors will not be liable in any case to the extent
          that any such loss, claim, damage or liability arises out of or is
          based upon any such untrue statement or alleged untrue statement or
          omission or alleged omission made therein in reliance upon and in
          conformity with written information furnished to the Company and the
          Subsidiary Guarantors by or on behalf of any such Holder specifically
          for inclusion therein, (ii) with respect to any untrue statement or
          omission or alleged untrue statement or omission made in any
          preliminary Prospectus relating to a Shelf Registration Statement, the
          foregoing indemnity shall not inure to the benefit of any Holder
          (including any Exchanging Dealer) from whom the Person asserting any
          such loss, claim, damage or liability purchased the



                                       17




          Securities or the New Securities, as the case may be, to the extent
          that a final Prospectus relating to such Securities or New Securities,
          as the case may be, was required to be delivered by such Holder under
          the Act in connection with such purchase and any such loss, claim,
          damage or liability of such Holder results from the failure of such
          Holder to send to such Person, at or prior to the written confirmation
          of the sale of such Securities or New Securities, as the case may be,
          a copy of the final Prospectus if the Company had previously furnished
          copies thereof to such Holder and (iii) the Company and the Subsidiary
          Guarantors shall not be liable in any such case to the extent that
          such loss, claim, damage or liability arises out of or is based upon
          the use of a Registration Statement after (x) a stop order has been
          issued in a respect of a Registration Statement or (y) a Registration
          Statement has been suspended, so long as, in the case of each of (x)
          and (y), such Holder has received notice of such action in accordance
          with Section 5(c) hereof. This indemnity agreement will be in addition
          to any liability which the Company and the Subsidiary Guarantors may
          otherwise have.

                  The Company and the Subsidiary Guarantors also, jointly and
         severally, agree to indemnify or contribute as provided in Section 7(d)
         to Losses of any underwriter of any Securities or New Securities, as
         the case may be, registered under a Shelf Registration Statement, their
         directors, officers, employees or agents and each Person who controls
         such underwriter (within the meaning of the Act or the Exchange Act) on
         substantially the same basis as that of the indemnification of the
         Initial Purchasers and the selling Holders provided in this Section
         7(a) and shall, if requested by any Holder, enter into an underwriting
         agreement reflecting such agreement, as provided in Section 5(p)
         hereof.

                             (b)   Each Holder of Securities or New Securities,
          as the case may be, covered by a Registration Statement (including
          each Initial Purchaser and, with respect to any Prospectus delivery as
          contemplated in Section 5(h) hereof, each Exchanging Dealer) severally
          agrees to indemnify and hold harmless the Company and the Subsidiary
          Guarantors, each of their directors, each of their officers who signs
          such Registration Statement and each Person who controls the Company
          or any of the Subsidiary Guarantors within the meaning of either the
          Act or the Exchange Act, to the same extent as the foregoing indemnity
          from the Company and the Subsidiary Guarantors to each such Holder,
          but only with reference to written information furnished to the
          Company or the Subsidiary Guarantors by or on behalf of such Holder
          specifically for inclusion in the documents referred to in the
          foregoing indemnity and agrees to reimburse each such indemnified
          party for any legal or other expenses reasonably incurred, as
          incurred, by them in connection with investigation or defending such
          loss, claim, liability, damage or action. This indemnity agreement
          will be in addition to any liability which any such Holder may
          otherwise have.

                             (c)   Promptly after receipt by an indemnified
          party under this Section 7 of notice of the commencement of any
          action, such indemnified party will, if a claim in respect thereof is
          to be made against the indemnifying party under this Section 7, notify
          the indemnifying party in writing of the commencement thereof; but the
          failure so to notify the indemnifying party (i) will not relieve it
          from liability under paragraph (a) or (b) above unless and to the
          extent it did not otherwise learn of such action and such failure
          results in the forfeiture by the indemnifying party of substantial
          rights and



                                       18




          defenses; and (ii) will not, in any event, relieve the indemnifying
          party from any obligations to any indemnified party other than the
          indemnification obligation provided in paragraph (a) or (b) above. The
          indemnifying party shall be entitled to appoint counsel of the
          indemnifying party's choice at the indemnifying party's expense to
          represent the indemnified party in any action for which
          indemnification is sought (in which case the indemnifying party shall
          not thereafter be responsible for the fees and expenses of any
          separate counsel retained by the indemnified party or parties except
          as set forth below); PROVIDED, HOWEVER, that such counsel shall be
          reasonably satisfactory to the indemnified party. Notwithstanding the
          indemnifying party's election to appoint counsel to represent the
          indemnified party in an action, the indemnified party shall have the
          right to employ separate counsel (including local counsel), and the
          indemnifying party shall bear the reasonable fees, costs and expenses
          of such separate counsel if (i) the use of counsel chosen by the
          indemnifying party to represent the indemnified party would present
          such counsel with a conflict of interest; (ii) the actual or potential
          defendants in, or targets of, any such action include both the
          indemnified party and the indemnifying party and the indemnified party
          shall have reasonably concluded that there may be legal defenses
          available to it and/or other indemnified parties which are different
          from or additional to those available to the indemnifying party; (iii)
          the indemnifying party shall not have employed counsel satisfactory to
          the indemnified party to represent the indemnified party within a
          reasonable time after notice of the institution of such action; or
          (iv) the indemnifying party shall authorize the indemnified party to
          employ separate counsel at the expense of the indemnifying party. An
          indemnifying party will not, without the prior written consent of the
          indemnified parties, settle or compromise or consent to the entry of
          any judgment with respect to any pending or threatened claim, action,
          suit or proceeding in respect of which indemnification or contribution
          may be sought hereunder (whether or not the indemnified parties are
          actual or potential parties to such claim or action) unless such
          settlement, compromise or consent includes an unconditional release of
          each indemnified party from all liability arising out of such claim,
          action, suit or proceeding.

                             (d)   In the event that the indemnity provided in
          paragraph (a) or (b) of this Section 7 is unavailable to or
          insufficient to hold harmless an indemnified party for any reason,
          then each applicable indemnifying party shall have a joint and several
          obligation to contribute to the amount paid or payable by such
          indemnified party as a result of the aggregate losses, claims, damages
          and liabilities referred to in subsection (a) or (b), as the case may
          be, above, (including legal or other expenses reasonably incurred in
          connection with investigating or defending same) (collectively
          "Losses") to which such indemnified party may be subject in such
          proportion as is appropriate to reflect the relative benefits received
          by such indemnifying party, on the one hand, and such indemnified
          party, on the other hand, from the Initial Placement and the
          Registration Statement which resulted in such Losses; PROVIDED,
          HOWEVER, that in no case shall any Initial Purchaser of any Security
          or New Security be obligated to contribute in accordance with this
          paragraph (d) an amount, in the aggregate, in excess of the purchase
          discount or commission applicable to such Security, or in the case of
          a New Security, applicable to the Security that was exchangeable into
          such New Security, as set forth on the cover page of the Final
          Memorandum, nor shall any underwriter be obligated to contribute in
          accordance with this paragraph (d) an amount in excess of the
          underwriting discount or commission applicable to the securities
          purchased by such underwriter under



                                       19




          the Registration Statement which resulted in such Losses. If the
          allocation provided by the immediately preceding sentence is
          unavailable for any reason, the indemnifying party and the indemnified
          party shall contribute in such proportion as is appropriate to reflect
          not only such relative benefits but also the relative fault of such
          indemnifying party, on the one hand, and such indemnified party, on
          the other hand, in connection with the statements or omissions which
          resulted in such Losses as well as any other relevant equitable
          considerations. Benefits received by the Company and the Subsidiary
          Guarantors shall be deemed to be equal to the sum of (x) the total net
          proceeds from the Initial Placement (before deducting expenses) as set
          forth on the cover page of the Final Memorandum and (y) the total
          amount of additional interest which the Company was not required to
          pay as a result of registering the securities covered by the
          Registration Statement which resulted in such Losses. Benefits
          received by the Initial Purchasers shall be deemed to be equal to the
          total purchase discounts and commissions as set forth on the cover
          page of the Final Memorandum, and benefits received by any other
          Holders shall be deemed to be equal to the proceeds received from the
          sale of the Securities or New Securities, as applicable. Benefits
          received by any underwriter shall be deemed to be equal to the total
          underwriting discounts and commissions, as set forth on the cover page
          of the Prospectus forming a part of the Registration Statement which
          resulted in such Losses. Relative fault shall be determined by
          reference to, among other things, whether any alleged untrue statement
          or omission relates to information provided by the indemnifying party,
          on the one hand, or by the indemnified party, on the other hand, the
          intent of the parties and their relative knowledge, access to
          information and opportunity to correct or prevent such untrue
          statement or omission. The parties agree that it would not be just and
          equitable if contribution were determined by pro rata allocation (even
          if the Holders were treated as one entity for such purpose) or any
          other method of allocation which does not take account of the
          equitable considerations referred to above. Notwithstanding the
          provisions of this paragraph (d), no Person guilty of fraudulent
          misrepresentation (within the meaning of Section 11(f) of the Act)
          shall be entitled to contribution from any Person who was not guilty
          of such fraudulent misrepresentation. For purposes of this Section 7,
          each Person who controls a Holder within the meaning of either the Act
          or the Exchange Act and each director, officer, employee and agent of
          such Holder shall have the same rights to contribution as such Holder,
          and each Person who controls the Company or any of the Subsidiary
          Guarantors within the meaning of either the Act or the Exchange Act,
          each officer of the Company or any of the Subsidiary Guarantors who
          shall have signed the Registration Statement and each director of the
          Company or any of the Subsidiary Guarantors shall have the same rights
          to contribution as the Company, subject in each case to the applicable
          terms and conditions of this paragraph (d).

                             (e)   The provisions of this Section 7 will remain
          in full force and effect, regardless of any investigation made by or
          on behalf of any Holder or the Company and the Subsidiary Guarantors
          or any of the officers, directors or controlling Persons referred to
          in this Section 7, and will survive the sale by a Holder of Securities
          or New Securities covered by a Registration Statement or any
          termination or cancellation of this Agreement.



                                       20




                       8.    UNDERWRITTEN REGISTRATIONS.

                             (a)   If any of the Securities or New Securities,
          as the case may be, covered by any Shelf Registration Statement are to
          be sold in an underwritten offering, the Managing Underwriters shall
          be selected by the Majority Holders.

                             (b)   No Person may participate in any underwritten
          offering pursuant to any Shelf Registration Statement, unless such
          Person (i) agrees to sell such Person's Securities or New Securities,
          as the case may be, on the basis reasonably provided in any
          underwriting arrangements approved by the Persons entitled hereunder
          to approve such arrangements; and (ii) completes and executes all
          questionnaires, powers of attorney, indemnities, underwriting
          agreements and other documents reasonably required under the terms of
          such underwriting arrangements.

                       9.    NO INCONSISTENT AGREEMENTS. The Company and the
Subsidiary Guarantors have not, as of the date hereof, entered into, nor shall
they, on or after the date hereof, enter into, any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders herein or
otherwise conflicts with the provisions hereof.

                       10.   AMENDMENTS AND WAIVERS. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
qualified, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, except by the Company and the written
consent of the Majority Holders (or, after the consummation of any Registered
Exchange Offer in accordance with Section 2 hereof, holders of a majority in
aggregate principal amount outstanding of New Securities); PROVIDED that, with
respect to any matter that directly or indirectly adversely affects the rights
of any Initial Purchaser (but not all of the Initial Purchasers) hereunder, the
Company shall obtain the written consent of each such Initial Purchaser against
which such amendment, qualification, supplement, waiver or consent is to be
effective. Notwithstanding the foregoing (except for the foregoing proviso), a
waiver or consent to departure from the provisions hereof with respect to a
matter that relates exclusively to the rights of some Holders whose Securities
or New Securities (the "affected Securities"), as the case may be, are being
sold pursuant to a Registration Statement and that does not directly or
indirectly affect the rights of other Holders may be given by the Holders
representing a majority of the aggregate principal amount of the affected
Securities, voting together as a single class.

                       11.   NOTICES. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand-delivery,
first-class mail, facsimile transmission or air courier guaranteeing overnight
delivery:

                             (a)   if to a Holder, at the most current address
          given by such holder to the Company in accordance with the provisions
          of this Section, which address initially is, with respect to each
          Holder, the address of such Holder maintained by the Registrar under
          the Indenture, with a copy in like manner to Salomon Smith Barney
          Inc.;

                             (b)   if to you, initially at the respective
          addresses set forth in the Purchase Agreement; and



                                       21




                             (c)   if to the Company or the Subsidiary
          Guarantors, initially at the address of the Company set forth in the
          Purchase Agreement.

                  All such notices and communications shall be deemed to have
been duly given when received.

                  The Initial Purchasers, the Company or the Subsidiary
Guarantors by notice to the other parties may designate additional or different
addresses for subsequent notices or communications.

                       12.   SUCCESSORS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including, without the need for an express assignment or any consent by
the Company thereto, subsequent Holders of Securities and the New Securities.
The Company hereby agrees to extend the benefits of this Agreement to any Holder
of Securities and the New Securities, and any such Holder may specifically
enforce the provisions of this Agreement as if an original party hereto.

                       13.   COUNTERPARTS. This Agreement may be in signed
counterparts, each of which shall an original and all of which together shall
constitute one and the same agreement.

                       14.   HEADINGS. The headings used herein are for
convenience only and shall not affect the construction hereof.

                       15.   APPLICABLE LAW. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York applicable
to contracts made and to be performed in the State of New York.

                       16.   SEVERABILITY. In the event that any one or more of
the provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal or unenforceable in any respect for any
reason, the validity, legality and enforceability of any such provision in every
other respect and of the remaining provisions hereof shall not be in any way
impaired or affected thereby, it being intended that all of the rights and
privileges of the parties shall be enforceable to the fullest extent permitted
by law.

                       17.   SECURITIES HELD BY THE COMPANY, ETC. Whenever the
consent or approval of Holders of a specified percentage of principal amount of
Securities or New Securities is required hereunder, Securities or New
Securities, as applicable, held by the Company or its Affiliates (other than
subsequent Holders of Securities or New Securities if such subsequent Holders
are deemed to be Affiliates solely by reason of their holdings of such
Securities or New Securities) shall not be counted in determining whether such
consent or approval was given by the Holders of such required percentage.

                       18.   AGENT FOR SERVICE; SUBMISSION TO JURISDICTION;
WAIVER OF IMMUNITIES. By the execution and delivery of this Agreement, each of
the Company and the Subsidiary Guarantors (i) hereby irrevocably designates and
appoints CT Corporation System (and any successor entity), as its authorized
agent upon which process may be served in any suit or proceeding arising out of
or relating to this Agreement that may be instituted in any Federal or state
court in the Borough of Manhattan in the City of New York or brought under
federal or


                                       22





state securities laws, and acknowledges that CT Corporation System has accepted
such designation, (ii) submits to the nonexclusive jurisdiction of any such
court in any such suit or proceeding, and (iii) agrees that service of process
upon CT Corporation System and written notice of said service to the Company
shall be deemed in every respect effective service of process upon it in any
such suit or proceeding. Each of the Company and the Subsidiary Guarantors
further agrees to take any and all action, including the execution and filing of
any and all such documents and instruments, as may be necessary to continue such
designation and appointment of CT Corporation System in full force and effect so
long as any of the Securities or New Securities shall be outstanding. To the
extent that either the Company or any Subsidiary Guarantor may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property, each
of them hereby irrevocably waives such immunity in respect of this Agreement, to
the fullest extent permitted by law.




                                       23





                  If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this Agreement and your acceptance shall represent a binding agreement
among the Company, the Subsidiary Guarantors and the several Initial Purchasers.


                                           Very truly yours,


                          COMPANY:

                          SUN MEDIA CORPORATION

                          By: /s/ Kin-Man Lee
                              -------------------------------------------------
                              Name:  Kin-Man Lee
                              Title: Vice President, Corporate Controller



                          SUBSIDIARY GUARANTORS:

                          BOWES PUBLISHERS LIMITED

                          By: /s/ Kin-Man Lee
                              -------------------------------------------------
                              Name:  Kin-Man Lee
                              Title: Vice President, Finance and Administration



                          SUN MEDIA (TORONTO) CORPORATION

                          By: /s/ Kin-Man Lee
                              -------------------------------------------------
                              Name:  Kin-Man Lee
                              Title: Vice President, Corporate Controller



                          SMC NOMINEECO INC.

                          By: /s/ Pierre Francoeur
                              -------------------------------------------------
                              Name:  Pierre Francoeur
                              Title: President and Chief Executive Officer



                          TORONTO SUN INTERNATIONAL, INC.

                          By: /s/ Kin-Man Lee
                              -------------------------------------------------
                              Name:  Kin-Man Lee
                              Title: Vice President, Corporate Controller







                          TS PRINTING, INC.

                          By: /s/ Kin-Man Lee
                              -------------------------------------------------
                              Name:  Kin-Man Lee
                              Title: Vice President, Corporate Controller



                          FLORIDA SUN PUBLICATIONS, INC.

                          By: /s/ Kin-Man Lee
                              -------------------------------------------------
                              Name:  Kin-Man Lee
                              Title: Vice President, Corporate Controller



                          3661458 CANADA INC.

                          By: /s/ Kin-Man Lee
                              -------------------------------------------------
                              Name:  Kin-Man Lee
                              Title: Vice President, Corporate Controller



                          3351611 CANADA INC.

                          By: /s/ Pierre Francoeur
                              -------------------------------------------------
                              Name:  Pierre Francoeur
                              Title: President








The foregoing Agreement is hereby confirmed and
accepted as of the date first above written.



SALOMON SMITH BARNEY INC.
RBC DOMINION SECURITIES CORPORATION
TD SECURITIES (USA) INC.
BMO NESBITT BURNS CORP.
CREDIT SUISSE FIRST BOSTON CORPORATION
SCOTIA CAPITAL (USA) INC.
CIBC WORLD MARKETS CORP.


By: SALOMON SMITH BARNEY INC.

By:      /s/ Kevin M. Sisson
    ----------------------------------
     Name:  Kevin Sisson
     Title: Vice President





                                                                        ANNEX A



                  Each broker-dealer that receives new securities for its own
account pursuant to the exchange offer must acknowledge that it will deliver a
prospectus in connection with any resale of these new securities. The letter of
transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of new securities received in exchange for securities where those
securities were acquired by this broker-dealer as a result of market-making
activities or other trading activities. We have agreed that, starting on the
expiration date and ending on the close of business 180 days after the
expiration date, we will make this prospectus available to any broker-dealer for
use in connection with any such resale. See "Plan of Distribution."



                                       27




                                                                        ANNEX B



                  Each broker-dealer that receives new securities for its own
account in exchange for securities, where those securities were acquired by this
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of those new securities. See "Plan of Distribution."



                                       28




                                                                        ANNEX C



                              PLAN OF DISTRIBUTION

                  Each broker-dealer that receives new securities for its own
account pursuant to the exchange offer must acknowledge that it will deliver a
prospectus in connection with any resale of these new securities. This
prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of new securities received in
exchange for securities where those securities were acquired as a result of
market-making activities or other trading activities. We and the subsidiary
guarantors have agreed that, starting on the expiration date and ending on the
close of business 180 days after the expiration date, we will make this
prospectus, as amended or supplemented, available to any broker-dealer for use
in connection with any such resale. In addition, until __________, 200__, all
dealers effecting transactions in the new securities may be required to deliver
a prospectus.

                  We will not receive any proceeds from any sale of new
securities by broker-dealers. New securities received by broker-dealers for
their own account pursuant to the exchange offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the new securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer and/or the purchasers of any such new
securities. Any broker-dealer that resells new securities that were received by
it for its own account pursuant to the exchange offer and any broker or dealer
that participates in a distribution of such new securities may be deemed to be
an "underwriter" within the meaning of the Securities Act and any profit of any
such resale of new securities and any commissions or concessions received by any
such persons may be deemed to be underwriting compensation under the Securities
Act. The letter of transmittal states that by acknowledging that it will deliver
and by delivering a prospectus, a broker-dealer will not be deemed to admit that
it is an "underwriter" within the meaning of the Securities Act.

                  For a period of 180 days after the expiration date, we and the
Subsidiary Guarantors will promptly send additional copies of this prospectus
and any amendment or supplement to this prospectus to any broker-dealer that
requests such documents in the letter of transmittal. We have agreed to pay all
expenses incident to the exchange offer (including the expenses of one counsel
for the holders of the securities) other than commissions or concessions of any
brokers or dealers and will indemnify the holders of the securities (including
any broker-dealers) against certain liabilities, including liabilities under the
Securities Act.



                                       29




                                                                        ANNEX D



Rider A
                  CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
                  ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
                  AMENDMENTS OR SUPPLEMENTS THERETO.

                  Name:     _______________________________
                  Address:  _______________________________
                            _______________________________

Rider B

If the undersigned is not a broker-dealer, the undersigned represents that it
acquired the new securities in the ordinary course of its business, it is not
engaged in, and does not intend to engage in, a distribution of new securities
and it has no arrangements or understandings with any person to participate in a
distribution of the new securities. If the undersigned is a broker-dealer that
will receive new securities for its own account in exchange for securities, it
represents that the securities to be exchanged for new securities were acquired
by it as a result of market-making activities or other trading activities and
acknowledges that it will deliver a prospectus in connection with any resale of
such new securities; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.


                                       30

EX-4.4

                                                                     EXHIBIT 4.4



                             SUBORDINATION AGREEMENT

This SUBORDINATION AGREEMENT is dated as of February 7, 2003 (the "Agreement").

To:   National City Bank, for itself and as trustee under the Indenture referred
      to below for the holders of the Securities (the "Trustee")

          Sun Media Corporation, a British Columbia company (the "Obligor"), as
obligor under the convertible obligations dated as of July 9, 2001 and November
28, 2002 in the principal amount of Cdn$1,600,000,000 and Cdn$350,000,000,
respectively, made by the Obligor in favour of Quebecor Media Inc. (the
"Subordinated Notes"), and Quebecor Media Inc., as holder (the "Holder") of the
Subordinated Notes, for ten dollars and other good and valuable consideration
received by each of the Obligor and the Holder from the Trustee and by each of
the Obligor and the Holder from the other, agree as follows:

1.        INTERPRETATION.

     (a) "CASH, PROPERTY OR SECURITIES". "Cash, Property or Securities" shall
not be deemed to include securities of the Obligor or any other Person provided
for by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided herein with respect to the
Subordinated Notes, to the payment of all Senior Indebtedness which may at the
time be outstanding; provided, however, that (i) all Senior Indebtedness is
assumed by the new Person, if any, resulting from any such reorganization or
readjustment, and (ii) the rights of the holders of the Senior Indebtedness are
not, without the consent of such holders, altered by such reorganization or
readjustment.

     (b) "PAYMENT IN FULL". "payment in full", with respect to Senior
Indebtedness, means the receipt on an irrevocable basis of cash in an amount
equal to the unpaid principal amount of the Senior Indebtedness and premium, if
any, and interest and any special interest thereon to the date of such payment,
together with all other amounts owing with respect to such Senior Indebtedness.

     (c) "SENIOR INDEBTEDNESS". "Senior Indebtedness" means, at any date all
indebtedness (including, without limitation, any and all amounts of principal,
interest, special interest, additional amounts, premium, fees, penalties,
indemnities and "post-petition interest" in bankruptcy and any reimbursement of
expenses) under (1) the Indenture, including, without limitation, the "Notes,"
the "Subsidiary Guarantees," the "Exchange Notes," the "Additional Notes" and
any "Guarantee" of the Exchange Notes or the Additional Notes (in each case, as
defined in the Indenture) and (2) the Credit Agreement, dated as of February 7,
2003, among the Obligor, the financial institutions identified as lenders
therein, Banc of America Securities LLC, as joint lead arranger, Bank of
America, N.A., as administrative agent, and Credit Suisse First Boston
Corporation, as joint lead arranger and syndication agent.

2.        AGREEMENT ENTERED INTO PURSUANT TO INDENTURE. The Obligor and the
Holder are entering into this Agreement pursuant to the provisions of the
Indenture, dated as of February 7, 2003 (the "Indenture"; capitalized terms used
herein without definition having the meanings set forth therein) among the
Obligor, the Subsidiary Guarantors and the Trustee. Pursuant to the Indenture,
the Obligor has issued and the Subsidiary Guarantors have guaranteed,



                                      - 2 -

US$205,000,000 aggregate principal amount of the Obligor's 7 5/8% Senior Notes
due 2013 (the "Securities").

3.        SUBORDINATION. The indebtedness represented by the Subordinated
Notes shall be subordinated as follows:

     (a) AGREEMENT TO SUBORDINATE. The Obligor, for itself and its successors
and assigns, and the Holder agree, that the indebtedness evidenced by the
Subordinated Notes (including, without limitation, principal, interest, premium,
fees, penalties, indemnities and "post-petition interest" in bankruptcy and any
reimbursement of expenses) is subordinate and junior in right of payment, to the
extent and in the manner provided in this Section 3, to the prior payment in
full of all Senior Indebtedness. The provisions of this Section 3 are for the
benefit of the Trustee acting on behalf of the holders from time to time of
Senior Indebtedness, and such holders are hereby made obligees hereunder to the
same extent as if their names were written herein as such, and they
(collectively or singly) may proceed to enforce such provisions.

     (b) LIQUIDATION, DISSOLUTION OR BANKRUPTCY.

          (i) Upon any distribution of assets of the Obligor to creditors or
              upon a liquidation or dissolution or winding-up of the Obligor or
              in a bankruptcy, arrangement, liquidation, reorganization,
              insolvency, receivership or similar case or proceeding relating to
              the Obligor or its property or other marshalling of assets of the
              Obligor:

              (A)  the holders of Senior Indebtedness shall be entitled to
                   receive payment in full of all Senior Indebtedness before the
                   Holder shall be entitled to receive any payment of principal
                   of or interest on, or any other amount owing in respect of,
                   the Subordinated Notes;

              (B)  until payment in full of all Senior Indebtedness, any
                   distribution of assets of the Obligor of any kind or
                   character to which the Holder would be entitled but for this
                   Section 3 is hereby assigned to the holders of Senior
                   Indebtedness absolutely and shall be paid by the Obligor or
                   by any receiver, trustee in bankruptcy, liquidating trustee,
                   agents or other Persons making such payment or distribution
                   to the Trustee on behalf of the holders of Senior
                   Indebtedness, as their interests may appear; and

              (C)  in the event that, notwithstanding the foregoing, any payment
                   or distribution of assets of the Obligor of any kind or
                   character, whether in Cash, Property or Securities, shall be
                   received by the Holder before all Senior Indebtedness is paid
                   in full, such payment or distribution shall be held in trust
                   for the benefit of and shall be paid over to the Trustee on
                   behalf of the holders of Senior Indebtedness, as their
                   interests may appear, for application to the payment of all
                   Senior Indebtedness until all Senior Indebtedness shall have
                   been paid in full after giving effect to any concurrent

                                        2


                                      - 3 -

                   payment or distribution to the holders of Senior Indebtedness
                   in respect of such Senior Indebtedness.

          (ii) If (A) a bankruptcy, reorganization, insolvency, receivership or
               similar proceeding relating to the Obligor or its property (a
               "Reorganization Proceeding") is commenced and is continuing and
               (B) the Holder does not file proper claims or proofs of claim in
               the form required in a Reorganization Proceeding prior to 45 days
               before the expiration of the time to file such claims, then (1)
               upon the request of the Trustee, the Holder shall file such
               claims and proofs of claim in respect of the Subordinated Notes
               and execute and deliver such powers of attorney, assignments and
               proofs of claim or proxies as may be directed by the Trustee to
               enable it to exercise in the sole discretion of the Trustee any
               and all voting rights attributable to the Subordinated Notes
               which are capable of being voted (whether by meeting, written
               resolution or otherwise) in a Reorganization Proceeding and
               enforce any and all claims upon or in respect of the Subordinated
               Notes and to collect and receive any and all payments or
               distributions which may be payable or deliverable at any time
               upon or in respect of the Subordinated Notes, and (2) whether or
               not the Trustee shall take the action described in clause (1)
               above, the Trustee shall nevertheless be deemed to have such
               powers of attorney as may be necessary to enable the Trustee to
               exercise such voting rights, file appropriate claims and proofs
               of claim and otherwise exercise the powers described above for
               and on behalf of the Holder.

     (c) SUBROGATION. After all Senior Indebtedness is paid in full and until
the Subordinated Notes are paid in full, the Holder shall be subrogated to the
rights of the holders of Senior Indebtedness. For purposes of this Section 3(c),
a distribution made under this Section 3 to holders of Senior Indebtedness which
otherwise would have been made to the Holder, or a payment made by the Holder to
holders of Senior Indebtedness in respect of a turnover obligation under this
Section 3, is not, as between the Obligor and such holder, a payment by the
Obligor on Senior Indebtedness.

     (d) RELATIVE RIGHTS. This Section 3 defines the relative rights of the
Holder and the holders of Senior Indebtedness. Nothing in this Section 3 shall:

          (i)  impair, as between the Obligor and the Holder, the obligation of
               the Obligor, which is absolute and unconditional, to pay the
               principal of and interest on the Subordinated Notes in accordance
               with their terms; or

          (ii) affect the relative rights of the Holder and creditors of the
               Obligor other than the holders of Senior Indebtedness; or

          (iii) affect the relative rights of the holders of Senior Indebtedness
                among themselves; or

                                        3



                                      - 4 -

          (iv) prevent the Holder from exercising its available remedies upon a
               default, subject to the rights of the holders of Senior
               Indebtedness to receive cash, property or other assets otherwise
               payable to the Holder.

     (e) SUBORDINATION MAY NOT BE IMPAIRED.

          (i)  No right of any holder of Senior Indebtedness to enforce the
               subordination of indebtedness evidenced by the Subordinated Notes
               shall in any way be prejudiced or impaired by any act or failure
               to act by the Obligor or by any such holder or the Trustee, or by
               any non-compliance by the Obligor with the terms, provisions or
               covenants herein, regardless of any knowledge thereof which any
               such holder or the Trustee may have or be otherwise charged with.
               Neither the subordination of the Subordinated Notes as herein
               provided nor the rights of the holders of Senior Indebtedness
               with respect hereto shall be affected by any extension, renewal
               or modification of the terms, or the granting of any security in
               respect of, any Senior Indebtedness or any exercise or
               non-exercise of any right, power or remedy with respect thereto.

          (ii) The Holder agrees that all indebtedness evidenced by the
               Subordinated Notes will be unsecured by any Lien upon or with
               respect to any property of the Obligor.

          (iii) The Holder agrees not to exercise any offset or counterclaim or
               similar right in respect of the indebtedness evidenced by the
               Subordinated Notes except to the extent payment of such
               indebtedness is permitted and will not assign or otherwise
               dispose of the Subordinated Notes or the indebtedness which it
               evidences unless the assignee or acquiror, as the case may be,
               agrees to be bound by the terms of this Agreement.

     (f) HOLDER ENTITLED TO RELY. Upon any payment or distribution pursuant to
this Section 3, the Holder shall be entitled to rely (i) upon any order or
decree of a court of competent jurisdiction in which any proceedings of the
nature referred to in Section 3(b) are pending, (ii) upon a certificate if the
liquidating trustee or agent or other person in such proceedings making such
payment or distribution to the Holder or its representative, if any, or (iii)
upon a certificate of the Trustee or any representative (if any) of the holders
of Senior Indebtedness for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Obligor, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Section 3.

4.        ENFORCEABILITY. Each of the Obligor and the Holder represents and
warrants that this Agreement has been duly authorized, executed and delivered by
each of the Obligor and the Holder and constitutes a valid and legally binding
obligation of each of the Obligor and the Holder, enforceable in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles; and on the date
hereof, the Holder

                                        4



                                      - 5 -

shall deliver an opinion or opinions of counsel to such effect to the
Trustee for the benefit of the holders of the Securities.

5.        MISCELLANEOUS.

     (a) Until payment in full of all the Senior Indebtedness, the Obligor and
the Holder agree that no amendment shall be made to either of the Subordinated
Notes which would affect the rights of the holders of the Senior Indebtedness
hereunder.

     (b) This Agreement may not be amended or modified in any respect, nor may
any of the terms or provisions hereof be waived, except by an instrument signed
by the Obligor, the Holder and the Trustee.

     (c) This Agreement shall be binding upon each of the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
Trustee and each and every holder of Senior Indebtedness and their respective
successors and assigns.

     (d) This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.

     (e) The Holder and the Obligor each hereby irrevocably agrees that any
suits, actions or proceedings arising out of or in connection with this
Agreement may be brought in any state or federal court sitting in The City of
New York or any court in the Province of Quebec and submits and attorns to the
non-exclusive jurisdiction of each such court.

     (f) The Holder and the Obligor will whenever and as often as reasonably
requested to do so by the Trustee, do, execute, acknowledge and deliver any and
all such other and further acts, assignments, transfers and any instruments of
further assurance, approvals and consents as are necessary or proper in order to
give complete effect to this Agreement.

     (g) Each of the Holder and the Obligor irrevocably appoints CT Corporation
System, as its authorized agent in the State of New York upon which process may
be served in any such suit or proceedings, and agrees that service of process
upon such agent, and written notice of said service to CT Corporation System, by
the person serving the same to the addresses listed below, shall be deemed in
every respect effective service of process upon the Holder or the Obligor, as
applicable, in any such suit or proceeding.

     If to the Obligor:

     Sun Media Corporation
     333 King Street East
     Toronto, Ontario M5A 3XS
     Canada

     If to the Holder:

     Quebecor Media Inc.
     612 Saint-Jacques Street

                                        5



                                      - 6 -

     Montreal, Quebec H3C 4M8
     Canada

     Each of the Holder and the Obligor further agrees to take any and all
action as may be necessary to maintain such designation and appointment of such
agent in full force and effect for a period of ten years from the date of this
Agreement.

                                        6


          IN WITNESS WHEREOF, the Obligor and the Holder each have caused this
Agreement to be duly executed.

                                   SUN MEDIA CORPORATION

                                   By:   /s/ Kin-Man Lee
                                         ---------------------------------------
                                         Name:     Kin-Man Lee
                                         Title:    Vice President, Corporate
                                                   Controller



























                     SUBORDINATION AGREEMENT SIGNATURE PAGE



                                   QUEBECOR MEDIA INC.

                                   By:   /s/ Louis Saint-Arnaud
                                         ---------------------------------------
                                         Name:     Louis Saint-Arnaud
                                         Title:    Vice-president, Affaires
                                                   juridiques et Secretaire


                                   By:    /s/ Claudine Tremblay
                                          --------------------------------------
                                          Name:     Claudine Tremblay
                                          Title:    Directeur, Secretariat
                                                    corporatif et Secretaire
                                                    adjoint






















                     SUBORDINATION AGREEMENT SIGNATURE PAGE



Acknowledged and agreed to
as of the date set forth above

NATIONAL CITY BANK


By:      /s/ James E. Schultz
         --------------------------------
         Name:     James E. Schultz
         Title:    Vice President



























                     SUBORDINATION AGREEMENT SIGNATURE PAGE

EX-5.1

                          [ARNOLD & PORTER LETTERHEAD]



                                 March 24, 2003



Sun Media Corporation
333 King Street East
Toronto, Ontario M5A 3X5
Canada


         Re:      U.S.$205,000,000 7-5/8% Senior Notes due 2013
                  ---------------------------------------------


Ladies and Gentlemen:

     We have acted as U.S. counsel to Sun Media Corporation, a corporation
continued under the laws of British Columbia (the "Company"), the Company's
Canadian subsidiaries named on SCHEDULE I attached hereto (collectively, the
"Canadian Guarantors") and Toronto Sun International, Inc., TS Printing, Inc.
and Florida Sun Publications, Inc. (collectively, the "U.S. Guarantors," and
together with the Canadian Guarantors, the "Guarantors") in connection with the
Company's new 7-5/8% Senior Notes due 2013 and the accompanying guarantees by
the Guarantors (collectively, the "Exchange Notes") in aggregate principal
amount of up to U.S.$205,000,000. The Company and the Guarantors have filed with
the Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "Act"), a Registration Statement on Form F-4 (the
"Registration Statement") relating to the Company's offer to exchange the
Exchange Notes for all of its outstanding 7-5/8% Senior Notes due 2013 and the
accompanying guarantees by the Guarantors (collectively, the "Outstanding Notes"
and, together with the Exchange Notes, the "Notes") as set forth in the
prospectus forming a part of the Registration Statement (the "Prospectus"). The
Exchange Notes will be issued, and the Outstanding Notes were issued, pursuant
to an indenture (the "Indenture") dated as of February 7, 2003 by and among the
Company, the Guarantors and National City Bank, as trustee (the "Trustee").
Capitalized terms used herein and not otherwise defined herein shall have the
meanings ascribed to such terms in the Prospectus.

     We have reviewed the Registration Statement and the Indenture, including
the form of the Notes attached thereto, filed as Exhibit 4.2 to the Registration
Statement, such corporate records of the U.S. Guarantors, such certificates of
officers of the U.S. Guarantors, public officials and others and original,
copies or facsimiles of such other agreements, instruments, certificates and
documents as we have deemed necessary or appropriate as a basis for our opinion
hereinafter set forth. We have also made such legal and factual examinations and
inquiries as we have deemed necessary or appropriate for





Sun Media Corporation
March 24, 2003
Page 2


purposes of this opinion. We have assumed that the issuance and exchange of the
Exchange Notes for the Outstanding Notes have been duly authorized by the
requisite corporate action on the part of the Company and the Canadian
Guarantors and the Indenture has been duly authorized, executed and delivered by
the Company and the Canadian Guarantors. Furthermore, we have assumed the
authority of the Trustee to enter into the Indenture and to authenticate the
Exchange Notes, the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, and the conformity to authentic
originals of all documents submitted to us as copies.

     We express this opinion as members of the bar of the State of New York, and
we do not express any opinion herein as to matters governed by any laws other
than the laws of the State of New York and the General Corporation Law of the
State of Delaware. We understand that Ogilvy Renault, Canadian counsel for the
Company, has delivered an opinion with respect to the due authorization,
execution and delivery of the Indentures and the Exchange Notes by the Company
and the Canadian Guarantors, which is filed as Exhibit 5.2 to the Registration
Statement.

     Based upon and subject to the foregoing, we are of the opinion that (i) the
Indenture has been duly authorized, executed and delivered by the U.S.
Guarantors, and that the Exchange Notes have been duly authorized by the U.S.
Guarantors and when issued, executed and delivered by the U.S. Guarantors and
authenticated by the Trustee pursuant to the terms and conditions of the
Indenture, the Exchange Notes will be validly issued, executed and delivered by
the U.S. Guarantors, and (ii) when the Registration Statement has become
effective under the Act and the Exchange Notes have been duly executed and
authenticated in accordance with the Indenture and exchanged for the Outstanding
Notes as contemplated in the Registration Statement, the Exchange Notes will
constitute valid and legally binding obligations of the Company and the
Guarantors, enforceable against the Company and the Guarantors in accordance
with their terms, subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium, receivership and similar laws relating to or affecting
creditors' rights generally and to equitable principles (regardless of whether
enforcement is sought in a proceeding in equity or at law).

     This opinion speaks only as of its date and is limited to present statutes,
regulations, judicial interpretations, orders, directives and decrees applicable
to the facts as they presently exist. In rendering this opinion, we assume no
obligation to revise or supplement this opinion should the present laws be
changed by legislative or regulatory action, judicial decision or otherwise.

     We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to this firm under the headings
"Legal Matters" and "Tax





Sun Media Corporation
March 24, 2003
Page 2


Considerations - U.S. Federal Income Tax Considerations" in the Registration
Statement. In giving the foregoing consent, we do not thereby admit that we are
in the category of persons whose consent is required under Section 7 of the Act
or the rules and regulations of the Commission thereunder.


                                             Very truly yours,

                                             /s/ Arnold & Porter





                                   SCHEDULE I
                                   ----------


                  Bowes Publishers Limited

                  Sun Media (Toronto) Corporation

                  SMC Nomineeco Inc.

                  3661458 Canada Inc.

                  3351611 Canada Inc.

EX-5.2

Montreal, March 24, 2003


Sun Media Corporation
333 King Street East
Toronto, Ontario
M5A 3X5


Ladies and Gentlemen:


RE:      US$205,000,000 7-5/8% SENIOR NOTES DUE 2013
- ----------------------------------------------------


We have acted as Canadian counsel to Sun Media Corporation, a company continued
under the laws of the Province of British Columbia (the "COMPANY"), the
Company's U.S. subsidiaries named on Schedule I attached hereto (collectively,
the "U.S. GUARANTORS") and Bowes Publishers Limited, Sun Media (Toronto)
Corporation, SMC Nomineeco Inc., 3351611 Canada Inc. and 3661458 Canada Inc.
(collectively, the "CANADIAN GUARANTORS", and together with the U.S. Guarantors,
the "GUARANTORS") in connection with the Company's new 7-5/8% Senior Notes due
2013 and the accompanying guarantees by the Guarantors (collectively, the
"EXCHANGE NOTES") in aggregate principal amount of US$205,000,000. The Company
and the Guarantors have filed with the Securities and Exchange Commission (the
"COMMISSION") under the Securities Act of 1933, as amended (the "ACT"), a
Registration Statement on Form F-4 (the "REGISTRATION STATEMENT") relating to
the Company's offer to exchange the Exchange Notes for all of its outstanding
7-5/8% Senior Notes due 2013 and the accompanying guarantees by the Guarantors
(collectively, the "OUTSTANDING NOTES" and, together with the Exchange Notes,
the "NOTES") as set forth in the prospectus forming a part of the Registration
Statement (the "PROSPECTUS"). The Exchange Notes will be issued, and the
Outstanding Notes were issued, pursuant to an indenture (the "INDENTURE") dated
February 7, 2003 among the Company, National City Bank, as trustee, and the
Guarantors. Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to such terms in the Prospectus.

We have examined the Registration Statement, the Indenture, the Notes, such
corporate records of the Company and the Canadian Guarantors, such certificates
of officers of the Company and the Canadian Guarantors, public officials and
others and original, copies or facsimiles of such other agreements, instruments,
certificates and documents as we have deemed necessary or advisable as a basis
for the opinion expressed below. We have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals, and
the conformity to authentic originals of all documents submitted to us as
copies. We have assumed the accuracy and completeness of the corporate records
of the Company and the Canadian Guarantors and the certificates of officers of
the Company and the Canadian Guarantors, public officials and others, examined
by us.



                                                                          Page 2

We are solicitors qualified to practice law only in the Provinces of British
Columbia and Ontario. We express no opinion herein as to any laws, or any
matters governed by any laws, other than laws of the Provinces of British
Columbia and Ontario and the federal laws of Canada applicable therein, all as
of the date hereof. Our opinion below with respect to execution and delivery is
limited to the extent that execution and delivery are matters governed by the
laws of the Provinces of British Columbia and Ontario and the federal laws of
Canada applicable therein.

Based upon and subject to the foregoing, we are of the opinion that the
Indenture has been duly authorized, executed and delivered by the Company and
the Canadian Guarantors, and that the Exchange Notes have been duly authorized
by the Company and the Canadian Guarantors and, when issued, executed and
delivered by the Company and the Canadian Guarantors and authenticated by the
Trustee pursuant to the terms and conditions of the Indenture, the Exchange
Notes will be validly issued, executed and delivered by the Company and the
Canadian Guarantors.

We have prepared the discussion included in the Prospectus, which forms part of
the Registration Statement, under the caption "Tax Considerations - Canadian
Federal Income Tax Considerations for Non-Residents of Canada". The discussion
under that caption is our opinion of the main federal income tax consequences
applicable to Non-Resident Holders, as defined therein, subject to the
conditions, limitations and assumptions described therein.

We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to this firm under the headings
"Legal Matters", "Description of the Notes - Enforceability of Judgments" and
"Tax Considerations - Canadian Federal Income Tax Considerations for
Non-Residents of Canada" in the Registration Statement. In giving the foregoing
consent, we do not thereby admit that we are in the category of persons whose
consent is required under Section 7 of the Act or the rules and regulations of
the Commission thereunder.


Yours truly,

/s/ Ogilvy Renault




                                   SCHEDULE I
                                   ----------



                         Toronto Sun International, Inc.
                         TS Printing, Inc.
                         Florida Sun Publications, Inc.

EX-8.1

                                                               EXHIBIT 8.1


                                 March 24, 2003



Sun Media Corporation
333 King Street East
Toronto, Ontario M5A 3X5
Canada


Ladies and Gentlemen:

We have acted as special tax counsel to Sun Media Corporation ("Sun Media") in
connection with the Registration Statement on Form F-4 filed by Sun Media with
the Securities and Exchange Commission on March 24, 2003 (the "Registration
Statement"). Capitalized terms used herein but not otherwise defined herein have
the meanings ascribed to such terms in the Registration Statement.

It is our opinion that, under the laws of the United States in effect as of the
date hereof and as of the date of the Prospectus, the discussion under the
heading "TAX CONSIDERATIONS - U.S. Federal Income Tax Considerations" in the
Prospectus incorporated by reference in the Registration Statement contains,
with respect to U.S. Holders, the relevant and material provisions of present
U.S. federal income tax law and is true and correct as set forth therein.

We hereby consent to the filing with the Securities and Exchange Commission of
this letter as an exhibit to the Registration Statement and the reference to us
under the heading "TAX CONSIDERATIONS - U.S. Federal Income Tax Considerations."
In giving such consent, we do not thereby admit that we are within the category
of persons whose consent is required under Section 7 of the Securities Act of
1933.

                                        Very truly yours,


                                        /s/ ARNOLD & PORTER

EX-10.4

                                                                    EXHIBIT 10.4

                             SUN MEDIA CORPORATION

                                  as Borrower

                                    - and -

                      THE FINANCIAL INSTITUTIONS IDENTIFIED
                          ON THE SIGNATURE PAGES HERETO

                                   as Lenders

                                     - and -

                          BANC OF AMERICA SECURITIES LLC

                   as Joint Lead Arranger and Joint Bookrunner

                               BANK OF AMERICA, N.A.

                    as Administrative Agent and Issuing Lender

                                     - and -

                            CREDIT SUISSE FIRST BOSTON

        as Joint Lead Arranger, Joint Bookrunner and Syndication Agent

- --------------------------------------------------------------------------------

                              FACILITY A - C$75,000,000
                          TERM FACILITY B - US$230,000,000

                                  CREDIT AGREEMENT
                                  February 7, 2003

- --------------------------------------------------------------------------------

                                  HEENAN BLAIKIE LLP

                  MONTREAL                                    TORONTO

      1250 Rene-Levesque Blvd. West               Royal Bank Plaza, South Tower
      Suite 2500                                  Suite 2600
      Montreal (Quebec) H3B 4Y1                   Toronto, Ontario, M5J 2J4
      Telephone: (514) 846-1212                   (416) 360-6336
      Fax:       (514) 846-3427                   (416) 360-8425







                               TABLE OF CONTENTS





                                                                                                          
ARTICLE 1.          INTERPRETATION..............................................................................01
SECTION 1.01        DEFINED TERMS...............................................................................01
SECTION 1.02        GENDER AND NUMBER...........................................................................29
SECTION 1.03        INTERPRETATION NOT AFFECTED BY HEADINGS, ETC................................................29
SECTION 1.04        CURRENCY....................................................................................29
SECTION 1.05        CERTAIN PHRASES, ETC........................................................................29
SECTION 1.06        ACCOUNTING TERMS............................................................................29
SECTION 1.07        NON-BUSINESS DAYS...........................................................................30
SECTION 1.08        RATEABLE PORTION OF ACCOMMODATIONS..........................................................30
SECTION 1.09        INCORPORATION OF SCHEDULES..................................................................30

ARTICLE 2.          CREDIT FACILITY.............................................................................30
SECTION 2.01        AVAILABILITY................................................................................30
SECTION 2.02        COMMITMENTS AND FACILITY LIMITS.............................................................30
SECTION 2.03        USE OF PROCEEDS.............................................................................31
SECTION 2.04        MANDATORY REPAYMENTS AND REDUCTIONS OF COMMITMENTS..........................................32
SECTION 2.05        MANDATORY PREPAYMENTS.......................................................................32
SECTION 2.06        OPTIONAL PREPAYMENTS AND REDUCTIONS OF COMMITMENTS..........................................33
SECTION 2.07        FEES........................................................................................34
SECTION 2.08        PAYMENTS UNDER THIS AGREEMENT...............................................................34
SECTION 2.09        APPLICATION OF PAYMENTS AND PREPAYMENTS.....................................................34
SECTION 2.10        CASH COLLATERALIZATION OF CERTAIN PAYMENTS AND PREPAYMENTS..................................35
SECTION 2.11        COMPUTATIONS OF INTEREST AND FEES...........................................................35

ARTICLE 3.          ADVANCES....................................................................................36
SECTION 3.01        THE ADVANCES................................................................................36
SECTION 3.02        PROCEDURE FOR ADVANCES......................................................................37
SECTION 3.03        LIBOR ADVANCES..............................................................................38
SECTION 3.04        MARKET FOR LIBOR ADVANCES...................................................................38
SECTION 3.05        SUSPENSION OF LIBOR ADVANCE OPTION..........................................................38
SECTION 3.06        LIMITS ON LIBOR ADVANCES....................................................................38
SECTION 3.07        CONVERSIONS OF ADVANCES.....................................................................38
SECTION 3.08        INTEREST ON PRIME RATE ADVANCES.............................................................38
SECTION 3.09        INTEREST ON US PRIME RATE ADVANCES..........................................................39
SECTION 3.10        INTEREST ON LIBOR ADVANCES..................................................................39

ARTICLE 4.          BANKERS' ACCEPTANCES........................................................................40
SECTION 4.01        ACCEPTANCES AND DRAFTS......................................................................40
SECTION 4.02        FORM OF DRAFTS..............................................................................41
SECTION 4.03        PROCEDURE FOR DRAWING.......................................................................41
SECTION 4.04        SIGNATURES OF DRAFT FORMS...................................................................41
SECTION 4.05        PAYMENT, CONVERSION OR RENEWAL OF BA INSTRUMENTS............................................42
SECTION 4.06        CIRCUMSTANCES MAKING BANKERS' ACCEPTANCES UNAVAILABLE.......................................42
SECTION 4.07        DEPOSITORY BILLS AND NOTES ACT..............................................................42

ARTICLE 5.          LETTERS OF CREDIT...........................................................................43
SECTION 5.01        LETTERS OF CREDIT...........................................................................43
SECTION 5.02        REIMBURSEMENTS OF AMOUNTS DRAWN.............................................................44
SECTION 5.03        RISK OF LETTERS OF CREDIT...................................................................44
SECTION 5.04        REPAYMENTS..................................................................................46
SECTION 5.05        APPLICABILITY OF ISP98 AND UCP..............................................................47
SECTION 5.06        CONFLICT WITH LETTER OF CREDIT APPLICATION..................................................47




                                       3




                                                                                                          
ARTICLE 6.          CONDITIONS OF LENDING.......................................................................47
SECTION 6.01        CONDITIONS PRECEDENT TO THE INITIAL ACCOMMODATION...........................................47
SECTION 6.02        CONDITIONS PRECEDENT TO ALL ACCOMMODATIONS AND CONVERSIONS..................................50
SECTION 6.03        NO WAIVER...................................................................................50

ARTICLE 7.          REPRESENTATIONS AND WARRANTIES..............................................................51
SECTION 7.01        REPRESENTATIONS AND WARRANTIES..............................................................51
                    (A)    INCORPORATION AND QUALIFICATION......................................................51
                    (B)    CORPORATE POWER......................................................................51
                    (C)    CONFLICT WITH OTHER INSTRUMENTS......................................................51
                    (D)    AUTHORIZATION, GOVERNMENTAL APPROVALS, ETC...........................................51
                    (E)    EXECUTION AND BINDING OBLIGATION.....................................................52
                    (F)    CONDUCT OF BUSINESS..................................................................52
                    (G)    LOCATION OF BUSINESS.................................................................52
                    (H)    AUTHORIZATIONS, ETC..................................................................52
                    (I)    TRADEMARKS, PATENTS, ETC.............................................................53
                    (J)    OWNERSHIP OF PROPERTY................................................................53
                    (K)    LEASED PROPERTIES....................................................................53
                    (L)    EXPROPRIATION........................................................................53
                    (M)    ENCROACHMENTS........................................................................53
                    (N)    COMPLIANCE WITH LAWS.................................................................53
                    (O)    SUBSIDIARIES, ETC....................................................................54
                    (P)    NO BURDENSOME AGREEMENTS.............................................................54
                    (Q)    NO LITIGATION........................................................................54
                    (R)    PENSION PLANS AND EMPLOYMENT LIABILITIES.............................................54
                    (S)    MATERIAL AGREEMENTS..................................................................54
                    (T)    FINANCIAL STATEMENTS.................................................................54
                    (U)    BOOKS AND RECORDS....................................................................55
                    (V)    INSURANCE............................................................................55
                    (W)    SOLVENCY.............................................................................55
                    (X)    TAX LIABILITY........................................................................55
                    (Y)    CORPORATE STRUCTURE..................................................................55
                    (Z)    CONTINGENT OBLIGATIONS AND INDEBTEDNESS..............................................56
                    (AA)   DISCLOSURE...........................................................................56

SECTION 7.02        SURVIVAL OF REPRESENTATIONS AND WARRANTIES..................................................56

ARTICLE 8.          COVENANTS OF THE BORROWER...................................................................56
SECTION 8.01        AFFIRMATIVE COVENANTS.......................................................................56
                    (A)    FINANCIAL REPORTING REQUIREMENTS.....................................................56
                    (B)    ENVIRONMENTAL REPORTING..............................................................57
                    (C)    ADDITIONAL REPORTING REQUIREMENTS....................................................58
                    (D)    CORPORATE EXISTENCE..................................................................58
                    (E)    COMPLIANCE WITH LAWS, ETC............................................................58
                    (F)    MAINTENANCE OF PROPERTIES, ETC.......................................................58
                    (G)    STATUS OF ACCOUNTS AND COLLATERAL....................................................59
                    (H)    CONDUCT OF BUSINESS AND HEDGING REQUIREMENTS.........................................59
                    (I)    ENVIRONMENTAL AUDITS.................................................................59
                    (J)    AUDITORS.............................................................................59
                    (K)    PAYMENT OF TAXES AND CLAIMS..........................................................59
                    (L)    KEEPING OF BOOKS.....................................................................59




                                       4




                                                                                                          
                    (M)    VISITATION AND INSPECTION............................................................59
                    (N)    MAINTENANCE OF INSURANCE.............................................................60
                    (O)    CURE DEFECTS, PRESERVATION OF SECURITY...............................................60
                    (P)    FURTHER ASSURANCES...................................................................60

SECTION 8.02        NEGATIVE COVENANTS..........................................................................60
                    (A)    DEBT.................................................................................61
                    (B)    ENCUMBRANCES.........................................................................61
                    (C)    MERGERS, ETC.........................................................................61
                    (D)    DISPOSAL OF ASSETS GENERALLY.........................................................61
                    (E)    TRANSACTIONS WITH AFFILIATES.........................................................62
                    (F)    CHANGE IN BUSINESS...................................................................62
                    (G)    SHARE CAPITAL........................................................................62
                    (H)    DISTRIBUTIONS........................................................................62
                    (I)    LOANS, INVESTMENTS AND ACQUISITIONS..................................................63
                    (J)    RENTAL OBLIGATIONS...................................................................63
                    (K)    SUBSIDIARIES.........................................................................63
                    (L)    MAINTENANCE AND OWNERSHIP OF SUBSIDIARIES............................................63
                    (M)    CAPITAL EXPENDITURES.................................................................63
                    (N)    BUSINESS OUTSIDE CERTAIN JURISDICTIONS...............................................64
                    (O)    FINANCIAL YEAR.......................................................................64
                    (P)    AMENDMENTS...........................................................................64

SECTION 8.03        FINANCIAL COVENANTS.........................................................................64
                    (A)    LEVERAGE RATIO.......................................................................64
                    (B)    INTEREST COVERAGE RATIO..............................................................64
                    (C)    FIXED CHARGE COVERAGE RATIO..........................................................65

ARTICLE 9.          EVENTS OF DEFAULT...........................................................................65
SECTION 9.01        EVENTS OF DEFAULT...........................................................................65
SECTION 9.02        REMEDIES UPON DEMAND AND DEFAULT............................................................68
SECTION 9.03        BANKRUPTCY AND INSOLVENCY...................................................................68
SECTION 9.04        RELATIONS WITH THE BORROWER.................................................................68
SECTION 9.05        APPLICATION OF PROCEEDS.....................................................................69

ARTICLE 10.         THE ADMINISTRATIVE AGENT AND THE LENDERS....................................................69
SECTION 10.01       AUTHORIZATION AND ACTION....................................................................69
SECTION 10.02       NO LIABILITY................................................................................70
SECTION 10.03       ACCOMMODATIONS BY ADMINISTRATIVE AGENT......................................................71
SECTION 10.04       HOLDING OF SECURITY, SHARING OF PAYMENTS, ETC...............................................71
SECTION 10.05       LENDER CREDIT DECISIONS.....................................................................73
SECTION 10.06       DELEGATION..................................................................................73
SECTION 10.07       INDEMNIFICATION.............................................................................73
SECTION 10.08       LIABILITY OF THE LENDERS INTER SE...........................................................73
SECTION 10.09       SUCCESSOR ADMINISTRATIVE AGENT..............................................................73
SECTION 10.10       ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM...............................................74
SECTION 10.11       REPLACEMENT OF SCHEDULE II REFERENCE LENDERS................................................75
SECTION 10.12       IRREVOCABLE POWER OF ATTORNEY (FONDE DE POUVOIR)............................................75

ARTICLE 11.         CURRENCY AND EXCHANGE.......................................................................75
SECTION 11.1        RULES AND CONVERSION........................................................................75
SECTION 11.2        DETERMINATION OF AN EQUIVALENT CURRENCY.....................................................76

ARTICLE 12.         MISCELLANEOUS...............................................................................76




                                       5




                                                                                                          
SECTION 12.01       AMENDMENT...................................................................................76
SECTION 12.02       WAIVER......................................................................................77
SECTION 12.03       EVIDENCE OF DEBT AND ACCOMMODATION NOTICES..................................................77
SECTION 12.04       NOTICES, ETC................................................................................77
SECTION 12.05       CONFIDENTIALITY.............................................................................78
SECTION 12.06       COSTS, EXPENSES AND INDEMNITY...............................................................78
SECTION 12.07       TAXES.......................................................................................80
SECTION 12.08       SUCCESSORS AND ASSIGNS......................................................................81
SECTION 12.09       FACILITY A LENDER BECOMING NON-RESIDENT.....................................................83
SECTION 12.10       RIGHT OF SET-OFF............................................................................83
SECTION 12.11       ACCOMMODATIONS BY LENDERS...................................................................84
SECTION 12.12       RATEABLE PAYMENTS...........................................................................84
SECTION 12.13       INTEREST ON ACCOUNTS........................................................................84
SECTION 12.14       GOVERNING LAW...............................................................................84
SECTION 12.15       CONSENT TO JURISDICTION.....................................................................85
SECTION 12.16       COUNTERPARTS................................................................................85
SECTION 12.17       SEVERABILITY................................................................................85
SECTION 12.18       ASSIGNMENT TO FEDERAL RESERVE BANK..........................................................85
SECTION 12.19       GOOD FAITH AND FAIR CONSIDERATION...........................................................86



SCHEDULES



SCHEDULES

                     
SCHEDULE 1        -        FORM OF ACCOMMODATION NOTICE
SCHEDULE 2        -        FORM OF REPAYMENT NOTICE
SCHEDULE 3        -        OFFER TO TERM LENDERS
SCHEDULE 4        -        APPLICABLE MARGINS
SCHEDULE 5        -        SECURITY AND SECURITY DOCUMENTS
SCHEDULE 6        -        ASSIGNMENT AGREEMENT
SCHEDULE 7        -        GUARANTORS
SCHEDULE 8        -        SUBORDINATION AGREEMENT
SCHEDULE 9        -        FORM OF NOTE


DISCLOSURE SCHEDULES

SCHEDULE 6.01(J) REAL PROPERTY OF LOAN PARTIES TO BE MORTGAGED
SCHEDULE 7.01(A) JURISDICTION OF INCORPORATION OF BORROWER, ITS SUBSIDIARIES
SCHEDULE 7.01(G) LOCATION OF BUSINESS AND OF MINUTE BOOKS OF LOAN PARTIES
SCHEDULE 7.01(I) INTELLECTUAL PROPERTY
SCHEDULE 7.01(J) OWNED PROPERTIES
SCHEDULE 7.01(K) LEASED PROPERTIES
SCHEDULE 7.01(O) MINORITY INTERESTS
SCHEDULE 7.01(R) PENSION PLANS
SCHEDULE 7.01(S) MATERIAL AGREEMENTS
SCHEDULE 7.01(Y) CORPORATE STRUCTURE



CREDIT AGREEMENT entered into in the City of Montreal, Province of Quebec, as
of February 7, 2003

                                   
AMONG:                                SUN MEDIA CORPORATION, a corporation continued and existing under the laws of
                                      British Columbia, Canada, having its chief executive office at 333 King Street
                                      East, in the City of Toronto, Province of Ontario (hereinafter called the
                                      "BORROWER")

                                   
                                      PARTY OF THE FIRST PART

                                   
AND:                                  THE FINANCIAL  INSTITUTIONS  NAMED ON THE  SIGNATURE  PAGES HEREOF OR FROM TIME
                                      TO TIME PARTIES HERETO (the "LENDERS")

                                   
                                      PARTIES OF THE SECOND PART

                                   
AND:                                  BANK OF AMERICA, N. A., AS ADMINISTRATIVE AGENT FOR THE LENDERS, a duly
                                      constituted bank, having a place of business at 555 South Flower, 17th floor,
                                      in the City of Los Angeles, California, 90071, and at 200 Front Street West,
                                      Suite 2700, Toronto, Ontario, M5V 3L2 (hereinafter called the "ADMINISTRATIVE
                                      AGENT")




                                 PARTY OF THE THIRD PART

         WHEREAS the Borrower wishes to borrow certain amounts from the
Lenders and the Lenders have agreed to lend such amounts to the Borrower,
subject to and in accordance with the provisions hereof;

                  NOW THEREFORE the parties hereto, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
hereby covenant and agree as follows.

                                      ARTICLE 1
                                  INTERPRETATION

                  SECTION 1.01.  DEFINED TERMS.  As used in this
Agreement, the following terms have the following meanings:




                                       2

                  "ACCOMMODATION" means (i) an Advance made by a Lender; (ii)
the creation and purchase of Bankers' Acceptances or the purchase of
completed Drafts by a Lender or by any other Person on the occasion of any
Drawing; and (iii) the creation, issue, extension of expiry date, renewal or
increase of Letters of Credit by an Issuing Lender (each of which is a "TYPE"
of Accommodation).

                  "ACCOMMODATION NOTICE" means a Borrowing Notice or a
Drawing Notice, as the case may be.

                  "ACCOMMODATIONS OUTSTANDING" means, at any time, the
principal amount owed to the Lenders under the Credit Facilities, and, more
specifically, (i) under Facility A, in relation to (a) the Borrower and all
Facility A Lenders, the amount of all Accommodations outstanding thereunder
at such time made to the Borrower by the Facility A Lenders, and (b) the
Borrower and each Facility A Lender, the amount of all Accommodations
outstanding at such time made by such Facility A Lender under its Facility A
Commitment; (ii) in respect of Swingline Advances, in relation to the
Borrower and the Swingline Lender, the Accommodations outstanding at such
time made to the Borrower by the Swingline Lender; (iii) in respect of
Letters of Credit, in relation to the Borrower and the Issuing Lender, the
Face Amount of all Letters of Credit outstanding at such time issued by the
Issuing Lender to the Borrower; and (iv) under Term Facility B, in relation
to (a) the Borrower and all Term Lenders, the amount of all Accommodations
outstanding thereunder at such time made to the Borrower by the Term Lenders,
and (b) the Borrower and each Term Lender, the amount of all Accommodations
outstanding at such time made by such Term Lender under its Term Credit
Commitment. In determining Accommodations Outstanding, the aggregate amount
thereof shall be determined on the basis of (i) in the case of all Credit
Facilities, the aggregate principal amount of all Advances; and (ii) in the
case of Facility A, an amount equal to the aggregate of the principal amount
of all Swingline Advances, the Face Amount of all Letters of Credit for which
the Facility A Lenders are contingently liable pursuant to Section 3.01(2)
and Section 5.02(2), as the case may be, and the Face Amount of all
outstanding BA Instruments which any applicable Lender has purchased or
arranged to have purchased (and in respect of each Facility A Lender, a
rateable part of such amounts).

                  "ACQUISITION" means, with respect to any Person, any
transaction or series of related transactions for the direct or indirect (i)
acquisition of all or substantially all of the Assets or a business or
division of any other Person; (ii) acquisition of any shares, interests,
participations or other equivalents (including partnership interests); or
(iii) reconstruction, reorganization, consolidation, amalgamation,
winding-up, merger, transfer, sale, lease or other combination with any other
Person; and "ACQUIRE" and "ACQUIRED" have meanings correlative thereto.

                  "ADDITIONAL DISTRIBUTIONS" means an amount of up to
$37,500,000 in the aggregate during the entire term of the Credit Facility
available to be paid to Quebecor Media Inc. or one of its subsidiaries up to
the expiry of the Term of Facility A, in addition to the payment thereto of
the permitted percentage of Excess Cash Flow as set out in the definition of
"Permitted Distributions", provided that the remaining (unused) Facility A
Commitment available under Facility A after making any such payment would be
at least $25,000,000.



                                       3


                  "ADMINISTRATIVE  AGENT" means, Bank of America, N.A. as
administrative agent for the Lenders under this Agreement, with assistance
from Bank of America, N.A., Canada Branch, and any successor appointed
pursuant to Section 10.09.

                  "ADVANCES" means advances of funds in Canadian Dollars made
by a Facility A Lender under Facility A, and advances in US$ by way of Libor
Advances and US Prime Rate Advances made by a Term Lender under Term Facility
B, all in accordance with Article 3, and "ADVANCE" means any one of such
advances. Advances made or to be made available by the Swingline Lender
pursuant to Article 3 are sometimes referred to as "SWINGLINE ADVANCES".

                  "AFFILIATE" has the meaning specified in the CANADA
BUSINESS CORPORATIONS ACT on the date of this Agreement, and, with respect to
any Lender that is a fund that invests in bank loans, means any other fund
that invests in bank loans and is advised or managed by the same investment
advisor as such Lender or by an Affiliate of such investment advisor.

         "AGENCY BRANCH ACCOUNT" means, (a) for all of the Facility A
Lenders, the account at the branch of the Administrative Agent located at 200
Front Street West, Suite 2700, in the City of Toronto, Province of Ontario,
M5V 3L2, Wiring - "DIRECT through "LVTS" to: Bank of America N. A., Canada
Branch, TRANSIT #: 56792- 241, Account #90083255, SWIFT CODE: BOFACATT,
Reference: Sun Media. Att'n: Loans Processing, or such other account or
address in Canada of which the Agent may notify the Borrower from time to
time; and (b) for all of the Term Lenders, the account at the Agent's office
located at Bank of America, N. A., 1850 Gateway Blvd., 5th Floor, MC:
CA4-706-05-09, Concord, CA 94520, Phone: (925) 675-8373, Fax: (925) 969-2414,
E-mail: kristine.l.kelleher@bankofamerica.com, wiring instructions Bank of
America, N. A., ABA #: 111-000-012, Acct. #: 37508-36479, Ref: Sun Media
Corp., or such other account or address in the U.S.A. of which the
Administrative Agent may notify the Borrower from time to time.

                  "AGENT-RELATED PERSONS" means the Administrative Agent,
together with its Affiliates (including, in the case of Bank of America in
its capacity as the Administrative Agent, Banc of America Securities LLC as
joint Arranger), and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and Affiliates.

                  "AGREEMENT" means this credit agreement and all schedules
and instruments in amendment or confirmation of it; and the expressions
"ARTICLE" and "SECTION" followed by a number mean and refer to the specified
Article or Section of this Agreement.

                  "ANNUAL BUSINESS PLAN" means, for any Financial Year, (i)
detailed pro-forma balance sheets, income statements and statements of
changes in the Borrower's and its subsidiaries' financial position, prepared
in accordance with GAAP (to the extent applicable), in respect of such
Financial Year and each Financial Quarter therein for the Borrower and its
subsidiaries' consolidated operations and supported by appropriate
explanations, notes and information; (ii) detailed pro-forma balance sheets,
income statements and statements of changes in the Borrower's and its
subsidiaries' financial position in respect of, and as at the last day of,
each of the next two following Financial Years, prepared in accordance with
GAAP (to the extent applicable) for the


                                       4


Borrower's and its subsidiaries' consolidated operations and supported by
appropriate explanations, notes and information and commentary; (iii) details
of any Capital Expenditures, including the nature and type of same, to be
made in such Financial Year; and (iv) a narrative of the Business for the
Financial Year then ended, all as approved by the Borrower's board of
directors.

                  "APPLICABLE COMMITMENT FEE" means, in respect of Facility
A, the Commitment Fees set out and defined in Schedule 4 corresponding to the
applicable Leverage Ratio. The Applicable Commitment Fee shall be adjusted on
the date the Administrative Agent receives the relevant Compliance
Certificate calculating the Leverage Ratio. If at any time any Compliance
Certificate is not delivered on the applicable due date, without prejudice to
the rights of the Lenders in respect of such Default, the Borrower shall pay
Commitment Fees set out in Tier I of the relevant table in Schedule 4 from
the date such Compliance Certificate was due until it is delivered.

                  "APPLICABLE MARGINS" means, at any time, subject to the
next following sentence, the margins set forth and defined in Schedule 4
corresponding, with respect to Facility A, to the Leverage Ratio at such
time. In respect of (i) Canadian Prime Rate Advances, the Applicable Margin
shall be the margin referred to in the column "C$ PRIME RATE ADVANCES"; (ii)
Drawings and Letters of Credit, the Applicable Margin shall be the margin
referred to in the column "BA DRAWING FEE AND LETTER OF CREDIT FEE", subject,
with respect to Letters of Credit, to the fee payable to the Issuing Lender
as contemplated by Section 5.01, (iii) Libor Advances, the Applicable Margin
shall be the margin referred to in the column "LIBOR", and (iv) US Prime Rate
Advances, the Applicable Margin shall be the margin referred to in the column
"US$ PRIME RATE ADVANCES". On the Closing Date, each Applicable Margin in
respect of Facility A shall be deemed to be that set out in Tier II of the
relevant table in Schedule 4, and thereafter, shall be adjusted on the date
the Administrative Agent receives the relevant Compliance Certificate
calculating the Leverage Ratio. If at any time any Compliance Certificate is
not delivered on the applicable due date, without prejudice to the rights of
the Lenders in respect of such Default, the Applicable Margin shall be that
set out in Tier I of the relevant table in Schedule 4 from the date such
Compliance Certificate was due until the date on which it is delivered.

If at the time of a change in the BA Drawing Fee, there exist any outstanding
Drawings of the Borrower under Facility A, the Borrower shall pay to the
Administrative Agent, for the rateable benefit of the Facility A Lenders (in
the case of an increase in the BA Drawing Fee) or receive repayment or credit
from the Lenders (in the case of a decrease in the BA Drawing Fee) for, an
amount in respect of each such Drawing equal to the product obtained by
multiplying (i) the product obtained by multiplying (w) the difference
between the BA Drawing Fee in effect prior to such change and the BA Drawing
Fee in effect immediately after such change, by (x) the aggregate face amount
of such Drawing, by (ii) the quotient obtained by dividing (y) the number of
days to maturity remaining in respect of such Drawing, by (z) 365 days. Any
payment as a result of a change in the Applicable Margin shall be made, in
respect of Drawings, on the next maturity date thereof in accordance with
Article 4.

                  "APPROVED FUND" means any Fund that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.



                                       5

                  "ARM'S LENGTH" has the meaning ascribed thereto for the
purposes of the INCOME TAX ACT (Canada), as in effect as of the date hereof.

                  "ASSETS" means, with respect to any Person, all property,
rights, assets and undertakings of such Person of every kind, tangible and
intangible, and wheresoever situate, whether now owned or hereafter acquired.

                  "ASSIGNEE" has the meaning specified in Section 12.08(3).

                  "AUTHORIZATION" means, with respect to any Person, any
authorization, order, permit, approval, grant, licence, consent, right,
franchise, privilege, certificate, judgment, writ, injunction, award,
determination, direction, decree, by-law, rule or regulation of any
Governmental Entity having jurisdiction over such Person.

                  "BACK-TO-BACK DEBT" means any loans made or debt
instruments issued as part of a Back-to-Back Transaction and in which each
party to such Back-to-Back Transaction, other than a Loan Party, executes a
subordination agreement in favor of the Administrative Agent in substantially
the form attached hereto as Schedule 8.

                  "BACK-TO-BACK PREFERRED SHARES" means preferred shares
issued:

         (a) to a Loan Party by an Affiliate of the Borrower in circumstances
         where, immediately prior to the issuance of such preferred shares, an
         Affiliate of such Loan Party has loaned on an unsecured basis to such
         Loan Party, or an Affiliate of such Loan Party has subscribed for
         preferred shares of such Loan Party in an amount equal to, the
         requisite subscription price for such preferred shares;
         (b) by a Loan Party to one of its Affiliates in circumstances where,
         immediately prior to or immediately after, as the case may be, the
         issuance of such preferred shares, such Loan Party has loaned an
         amount equal to the proceeds of such issuance to an Affiliate on an
         unsecured basis; or
         (c)  by a Loan Party to one of its Affiliates in circumstances
         where, immediately after the issuance of such preferred shares, such
         Loan Party has used all of the proceeds of such issuance to
         subscribe for preferred shares issued by an Affiliate;

         in each case on terms whereby:

         (i)      the aggregate redemption amount applicable to the preferred
         shares issued to or by such Loan Party is identical:
                  (A) in the case of (a) above, to the principal amount of
                  the loan made or the aggregate redemption amount of the
                  preferred shares subscribed for by such Affiliate prior to
                  the issuance thereof;
                  (B) in the case of (b) above, to the principal amount
                  of the loan made to such Affiliate with the proceeds of the
                  issuance thereof; or



                                       6

                  (C) in the case of (c) above, to the aggregate redemption
                  amount of the preferred shares issued by such Affiliate
                  with the proceeds of the issuance thereof;

         (ii)     the dividend payment date applicable to the preferred
                  shares issued to or by such Loan Party will:
                  (A) in the case of (a) above, be immediately prior to the
                  interest payment date relevant to the loan made or the
                  dividend payment date on the preferred shares subscribed
                  for by such Affiliate immediately prior to the issuance
                  thereof;
                  (B) in the case of (b) above, be immediately after the
                  interest payment date relevant to the loan made to such
                  Affiliate with the proceeds of the issuance thereof; or
                  (C) in the case of (c) above, be immediately after the
                  dividend payment date on the preferred shares issued by
                  such Affiliate with the proceeds of the issuance thereof;

         (iii)    the amount of dividends provided for on any payment date in
                  the share conditions attaching to the preferred shares
                  issued:
                  (A) to a Loan Party in the case of (a) above, will be equal to
                  or in excess of the amount of interest payable in respect of
                  the loan made or the amount of dividends provided for in
                  respect of the preferred shares subscribed for by such
                  Affiliate prior to the issuance thereof;
                  (B) by a Loan Party in the case of (b) above, will be equal
                  to or less than the amount of interest payable in respect of
                  the loan made to such Affiliate with the proceeds of the
                  issuance thereof; or
                  (C) by a Loan Party in the case of (c) above, will be equal
                  to the amount of dividends in respect of the preferred
                  shares issued by such Affiliate with the proceeds of the
                  issuance thereof.

         Provided, for greater certainty, that in all cases, (I) the
         redemption of any preferred shares by a Loan Party, (II) the
         repayment of any Back-to-Back Debt by a Loan Party, (III) the
         payment of any dividends by a Loan Party in respect of its preferred
         shares, and (IV) the payment of any interest on Back-to-Back Debt of
         a Loan Party, may, in each case, be made by a Loan Party solely by
         delivering the relevant Back-to-Back Securities to the Affiliate in
         question, or by paying to the Affiliate an amount in cash not in
         excess of the amount already received in cash from such Affiliate.

                  "BACK-TO-BACK SECURITIES" means the Back-to-Back Preferred
Shares or the Back-to-Back Debt or both, as the context requires.

                  "BACK-TO-BACK TRANSACTIONS" means any of the transactions
described under the definition of Back-to-Back Preferred Shares.

                  "BANKERS' ACCEPTANCE" has the meaning specified in Section
4.01.

                  "BA EQUIVALENT NOTE" has the meaning specified in Section
4.03(3).




                                       7

                  "BA INSTRUMENTS" means, collectively, Bankers' Acceptances,
Drafts and BA Equivalent Notes, and, in the singular, any one of them.

                  "BANKING DAY" means any day which is at the same time a
Business Day and a day on which dealings in US Dollar deposits are conducted
by and between banks in the London interbank eurodollar market.

                  "BORROWER" means Sun Media Corporation, and its successors
and permitted assigns.

                  "BORROWING NOTICE" has the meaning specified in Section
3.02.

                  "BUILDINGS AND FIXTURES" means all plants, buildings,
structures, erections, improvements, appurtenances and fixtures (including
fixed machinery and fixed equipment) situate on the Owned Properties and
Leased Properties.

                  "BUSINESS" means, with respect to the Borrower and its
subsidiaries, the business of publishing, distributing and selling
newspapers, shoppers or other publications, internet, cable and other news
media business and the business of commercial printing and any business
complementary thereto or an extension thereof.

                  "BUSINESS DAY" means any day of the year, other than a
Saturday, Sunday or other day on which banks are required or authorized to
close in, or are in fact closed in, (a) with respect to matters pertaining
exclusively to Accommodations and repayments under Facility A, Toronto,
Ontario, or (b) with respect to all other matters, (i) Toronto, Ontario, and
(ii) California, U.S.A. or such other State in which the Administrative
Agent's office is located from time to time.

                  "CANADIAN DOLLARS" and "CDN. $" each means lawful money of
Canada.

                  "CANADIAN PRIME RATE" means, at any time, the rate of
interest per annum equal to the greater of (i) the rate which the principal
office of the Administrative Agent in Toronto, Ontario quotes, publishes and
refers to as its "PRIME RATE" and which is its reference rate of interest for
demand commercial loans in Canadian Dollars to Canadian borrowers; and (ii)
the average rate for Canadian Dollar bankers' acceptances having a term of
one month that appears on the Reuters Screen CDOR Page (or such other page as
is a replacement page for such bankers' acceptances) as of 10:00 a.m.
(Toronto time) on the date of determination, as reported by the
Administrative Agent, plus 1.00%, adjusted automatically with each quoted,
published or displayed change in such rate, all without necessity of any
notice to the Borrower or any other Person.

                  "CAPITAL EXPENDITURES" means expenditures made for the
purchase, lease or acquisition of assets (other than current assets) required
to be capitalized in accordance with GAAP, other than expenditures in
connection with Permitted Acquisitions.



                                       8


                  "CASH EQUIVALENTS" means

                  1. United States Dollars or Canadian Dollars;

                  2. investments in securities with maturities of one year or
                     less from the date of acquisition issued or fully
                     guaranteed by any state, commonwealth, territory or
                     province of the United States of America or Canada, or
                     by any political subdivision or taxing authority
                     thereof, and rated in the "R-1" category by the Dominion
                     Bond Rating Service Limited;

                  3. certificates of deposit and eurodollar time deposits
                     with maturities of one year or less from the date of
                     acquisition, bankers' acceptances with maturities not
                     exceeding one year and overnight bank deposits, in each
                     case, with any domestic commercial bank having capital
                     and surplus in excess of US$500.0 million;

                  4. repurchase obligations with a term of not more than
                     seven days for underlying securities of the types
                     described in clauses (2) and (3) above entered into with
                     any financial institution meeting the qualifications
                     specified in clause (3) above;

                  5. commercial paper having the highest rating obtainable
                     from Moody's Investors Service, Inc. or Standard &
                     Poor's Rating Services and in each case maturing within
                     one year after the date of acquisition or with respect
                     to commercial paper in Canada, a rating in the "R-1"
                     category from the Dominion Bond Rating Service Limited;
                     and

                  6. money market funds at least 90% of the assets of which
                     constitute Cash Equivalents of the kinds described in
                     clauses (1) through (5) of this definition.

                  "CHANGE OF CONTROL" means the occurrence of one or more of
the following events (whether or not approved by the board of directors of
any such Person): (i) any Person or related group of Persons acting in
concert shall at any time be, directly or indirectly, the beneficial owner of
a greater percentage of the votes attaching to Quebecor Media Inc.'s
securities entitled to vote generally in an election of Quebecor Media Inc.'s
directors than the percentage of such votes beneficially owned by Quebecor or
the Peladeau Group at such time; (ii) the designees of Quebecor or the
Peladeau Group shall cease to represent the largest group of designees of any
Person or group of Persons acting in concert on the board of directors of
Quebecor Media Inc., or the said board is or becomes controlled by any other
shareholder; (iii) any Person or related group of Persons acting in concert
shall at any time be, directly or indirectly, the beneficial owner of a
greater percentage of the votes attaching to the Borrower's securities
entitled to vote generally in an election of the Borrower's directors than
the percentage of such votes beneficially owned by Quebecor and Quebecor
Media Inc. at such time; or (iv) the designees of Quebecor or Quebecor Media
Inc. shall cease to constitute a majority of the board of directors of the
Borrower.



                                       9


                  "CLAIM" means any claim of any nature whatsoever, including
any demand, liability, obligation, cause of action, suit, proceeding,
judgment, award, assessment and reassessment.

                  "CLOSING DATE" means February 7, 2003.

                  "COLLATERAL" means the Assets of the Borrower or any of its
subsidiaries in respect of which any Lender has or will have a Security
Interest pursuant to a Security Document.

                  "COMMITMENT" means, at any time, in respect of (i) Facility
A, Cdn.$75,000,000 (the "FACILITY A COMMITMENT"), which includes the
Swingline Advances up to an amount of Cdn.$5,000,000 (the "SWINGLINE
COMMITMENT") and Letters of Credit up to an amount of Cdn.$2,000,000; and
(ii) Term Facility B, US$230,000,000 (the "TERM CREDIT COMMITMENT"), in each
case, as such amount may be decreased pursuant to Article 2. A "LENDER'S
FACILITY A COMMITMENT", a "SWINGLINE LENDER'S COMMITMENT" and a "LENDER'S
TERM CREDIT COMMITMENT" means, at any time, the relevant amount designated as
such and set forth opposite such Lender's name on the signature pages hereof.

                  "COMPLIANCE CERTIFICATE" means a certificate of the
Borrower signed on its behalf by its chief financial officer, controller,
treasurer, or any other officer acceptable to the Administrative Agent, (i)
stating that any financial statements delivered by it pursuant to Section
8.01(a) present fairly the financial position, results of operations and
changes in financial position of the Borrower in accordance with GAAP; (ii)
stating that the representations and warranties in Article 7 are true and
correct in all material respects on and as of such date; (iii) stating that
the Borrower is not in breach of any of the covenants contained in Article 8
as at the date thereof (or describing the details of any subsisting breach);
(iv) stating that no Default has occurred and is continuing and that no Event
of Default has occurred (or describing the details of any subsisting Default
and the action which the Borrower proposes to take or has taken with respect
thereto or any Event of Default); and (v) providing, in reasonable detail,
evidence of compliance, at the end of each Financial Quarter, with Section
8.03 and evidencing the calculation of the financial covenants in Section
8.03 applicable at such time.

                  "CONSOLIDATED DEBT" means, for any Person, the aggregate of
all Debt of such Person and its subsidiaries, determined in accordance with
GAAP.

                  "CONSOLIDATED EBITDA" means, for any Person, for any period
and without duplication, earnings of such Person on a consolidated basis
before non-controlling interests, extraordinary items, Consolidated Interest
Charges, foreign exchange translation gains or losses not involving the
payment of cash, amortization of deferred financing costs and other non-cash
financial charges, taxes, depreciation and amortization, less any income
received in connection with Back-to-Back Securities, and without taking into
account any goodwill adjustments, calculated on a consolidated basis, and
otherwise calculated in accordance with GAAP.

                  "CONSOLIDATED FIXED CHARGES" means, for any Person, for any
period, the aggregate of (i) Consolidated Interest Charges, (ii) all
scheduled principal payments on account of Consolidated Debt, but excluding,
for greater certainty, the amount of the prepayment of the


                                       10


Existing Notes and the Existing Credit Agreement, to the extent either (a)
prepaid and cancelled on the Closing Date, or (b) that all amounts payable
thereunder, whether for obligations due or to become due, have been
irrevocably paid on the Closing Date to the trustee or agent thereunder, as
the case may be, such that no such trustee or agent, nor any noteholder or
lender under the Existing Notes and the Existing Credit Agreement, as the
case may be, shall have any further claim in respect of such Debt against the
Borrower or its subsidiaries, the Existing Notes shall be cancelled within 30
to 60 days following the Closing Date, and the Existing Credit Agreement
shall be cancelled not more than 15 days following the Closing Date (for the
purposes hereof, such payment and cancellation or provision of payment is
herein called "DEFEASANCE"), (iii) actual Capital Expenditures made by the
Person and its subsidiaries, in each case, for such period (to the extent
made from internally generated funds), and (iv) taxes paid in cash during
such period, net of any tax recovery and without duplication of any such
recovery.

                  "CONSOLIDATED INTEREST CHARGES" means, for any Person, for
any period for the Person and its subsidiaries, the sum of, without
duplication, (i) all items properly classified as interest expense in
accordance with GAAP (other than amounts paid in respect of (A) the
Back-to-Back Transactions, including under the Existing Back-to-Back
Securities, (B) any non-cash foreign exchange gains or losses recognized in
relation to foreign currency denominated Debt and (C) the amortization of
deferred financing cost), (ii) the imputed interest component of any element
of Consolidated Debt (such as capital leases) which would not be classified
as interest expense pursuant to (i), and (iii) the aggregate of all purchase
discounts relating to the sale of (a) bankers acceptances or other
instruments sold at a discount, and (b) accounts receivable in connection
with any asset securitization program, all as determined at such time in
accordance with GAAP.

                  "CONTINGENT OBLIGATIONS" of any Person means all contingent
liabilities required to be included in the financial statements of such
Person in accordance with GAAP, excluding any notes thereto.

                  "CREDIT DOCUMENTS" means this Agreement, the BA
Instruments, the Letters of Credit, the Security Documents, the Hedging
Agreements, the subordination agreements in respect of Back-to-Back
Securities and all other documents (including guarantees) to be executed and
delivered to the Administrative Agent, the Issuing Lender or the Lenders or
their Affiliates, or all of them, by the Borrower or the Guarantors in
connection with the Credit Facilities, as well as all documents to be
executed and delivered in connection with the Overdraft Facility.

                  "CREDIT FACILITIES" means, collectively, Facility A and
Term Facility B, and, in the singular any one of them.

                  "DEBENTURES" has the meaning attributed to it in Schedule 5.

                  "DEBT" of any Person means, at any time, without
duplication, (i) all indebtedness for borrowed money including borrowings of
commodities, bankers' acceptances, letters of credit or letters of guarantee;
for the purposes of calculating the amount of Debt denominated in US $, the
Borrower shall use the exchange rate contemplated in the Hedging Agreements
entered into in


                                       11


connection with the Hedging Requirements up to the extent to which such US $
denominated Debt is covered by such Hedging Agreements, (ii) obligations in
respect of the Negative Value of Hedging Agreements, but without duplication
of any underlying Debt that may be hedged by same, and without taking into
account the currency hedging in respect of the US $ denominated Debt referred
to in paragraph (i) above, (iii) all indebtedness for the deferred purchase
price of property or services, whether or not represented by a note or other
evidence of indebtedness, other than such obligations incurred in the
ordinary course of the Person's business, and payable within a period not
exceeding 150 days from the date of their incurrence, (iv) all indebtedness
created or arising under any conditional sale or other title retention
agreement with respect to property acquired by the Person (even though the
rights and remedies of the seller or lender under such agreement in the event
of default are limited to repossession or sale of such property), (v) all
indebtedness of another Person secured by a Lien created or assumed by the
Person on any properties or assets of the Person, (vi) Contingent
Obligations, (vii) all obligations under leases which have been or should be,
in accordance with GAAP, recorded as capital leases or Synthetic Leases in
respect of which the Person is liable as lessee, (viii) the aggregate amount
at which any shares in the capital of the Person which are redeemable or
retractable at the option of the holder may be retracted or redeemed for cash
or Debt (provided all conditions precedent for such retraction or redemption
have been satisfied), and (ix) all Debt Guaranteed by the Person; but shall
not include (a) the Back-to-Back Securities and the Existing Back-to-Back
Securities, and (b) provided that Defeasance has occurred, the Existing Notes
and the Existing Credit Agreement.

                  "DEBT GUARANTEED" by any Person means the maximum amount
which may be outstanding at any time of all Debt of the kinds referred to in
(i) through (viii) of the definition of Debt which is directly or indirectly
guaranteed by the Person or which the Person has agreed (contingently or
otherwise) to purchase or otherwise acquire, or in respect of which the
Person has otherwise assured a creditor or other Person against loss.

                  "DEFAULT" means an event which, with the giving of notice
or passage of time, or both, would constitute an Event of Default.

                  "DEFEASANCE" has the meaning attributed to it in the
definition of "Consolidated Fixed Charges".

                  "DESIGNATED PERIOD" means, with respect to a Libor Advance,
a period designated by the Borrower in accordance with Section 3.03.

                  "DISPOSITION" means with respect to any Asset of any
Person, any direct or indirect sale, lease (where such Person is the lessor
of such Asset), assignment, cession, transfer (including any transfer of
title or possession), exchange, conveyance, release, gift, including by means
of a sale-leaseback transaction, reorganization, consolidation, amalgamation
or merger; and "DISPOSE" and "DISPOSED" have meanings correlative thereto.

                  "DISTRIBUTION" means, in respect of any Person, (i) any
dividend or other distribution on issued shares of such Person, (ii) the
purchase, redemption or retirement amount of any issued shares, warrants or
any other options or rights to acquire shares of the Person redeemed




                                       12


or purchased by the Person, (iii) any payment made on, under, or in respect
of any Debt (other than Debt under this Agreement or payments required to be
made pursuant to the provisions of any pension plan of such Person in effect
from time to time), including interest, sinking fund or any like payment, and
(iv) any other payment made to an Affiliate of such Person unless such
payment is permitted under Section 8.02(e).

                  "DRAFT" means, at any time, (i) a bill of exchange, within
the meaning of the BILLS OF EXCHANGE ACT (Canada), drawn by the Borrower on a
Lender or any other Person and bearing such distinguishing letters and
numbers as the Lender or the Person may determine, but which at such time has
not been completed as to the payee by the Lender or the Person; or (ii) a
depository bill within the meaning of the DEPOSITORY BILLS AND NOTES ACT
(Canada).

                  "DRAWING" means (i) the creation and purchase of Bankers'
Acceptances by a Lender or by any other Person pursuant to Article 4; or (ii)
the purchase of completed Drafts by a Lender or by any other Person pursuant
to Article 4.

                  "DRAWING DATE" means any Business Day fixed for a Drawing
pursuant to Section 4.03.

                  "DRAWING FEE" means, with respect to each Bankers'
Acceptance or Draft drawn by the Borrower and purchased by any Person on any
Drawing Date, an amount equal to the Applicable Margin, multiplied by the
product of (i) a fraction, the numerator of which is the number of days,
inclusive of the first day and exclusive of the last day, in the term of
maturity of such Bankers' Acceptance or Draft, and the denominator of which
is 365 or 366, as the case may be, and (ii) the aggregate face amount of the
Bankers' Acceptance or Draft.

                  "DRAWING NOTICE" has the meaning specified in Section
4.03(1).

                  "DRAWING PRICE" means, in respect of Bankers' Acceptances
or Drafts purchased by a Facility A Lender or any other Person, the result
obtained by multiplying (a) the aggregate Face Amount of the Bankers'
Acceptances or Drafts by (b) the amount (rounded up or down to the fifth
decimal place with .000005 being rounded up) determined by dividing one by
the sum of one plus the product of (x) the Reference Discount Rate, and (y) a
fraction the numerator of which is the number of days to maturity of the
Bankers' Acceptances or Drafts and the denominator of which is 365.

                  "DRAWING PROCEEDS" means, in respect of any Bankers'
Acceptance or Draft purchased by a Lender or any other Person, an amount
equal to (i) the Drawing Price in respect of such Bankers' Acceptance or
Draft; minus (ii) the applicable Drawing Fee in respect of such Bankers'
Acceptance or Draft.

                  "ENVIRONMENTAL LAWS" means all applicable Laws relating to
the environment, health and safety matters or conditions, Hazardous
Substances, pollution or protection of the environment, including Laws
relating to (i) on site or off-site contamination; (ii) occupational health
and safety relating to Hazardous Substances; (iii) chemical substances or
products; (iv)



                                       13


Releases of pollutants, contaminants, chemicals or other industrial, toxic or
radioactive substances or Hazardous Substances into the environment; and (v)
the manufacture, processing, distribution, use, treatment, storage, transport
or handling of Hazardous Substance.

                  "ENVIRONMENTAL LIABILITIES AND COSTS" means all Losses and
Claims under applicable Environmental Laws, whether known or unknown, current
or potential, past, present or future, imposed by, under or pursuant to
Environmental Laws or otherwise relating to any Environmental Law, including
all Losses and Claims related to Remedial Actions and all reasonable fees,
disbursements and expenses of counsel, experts, personnel and consultants,
where such Losses and Claims are based on, arise out of or are otherwise in
respect of (i) the ownership or operation of the Business or any Assets
related to the Business; (ii) the conditions on, under, above or about any
real property, assets, equipment or facilities currently or previously owned,
leased or operated by the Borrower or any of its subsidiaries; (iii)
expenditures necessary to cause the operations of the Business or Assets
either related to the Business or owned, leased or operated by the Borrower
or any of its subsidiaries to comply materially with any and all
environmental requirements, including expenditures in connection with
obtaining all Environmental Permits; (iv) expenditures necessary to effect
the environmental closure, environmental decommissioning or environmental
rehabilitation of any of the operations of the Business or Assets either
related to the Business or owned, leased or operated by the Borrower or any
of its subsidiaries; (v) liability for personal injury or property damage,
including damages assessed for the maintenance of a public or private
nuisance; and (vi) any other matter affecting the Owned Properties, the
Leased Properties or other Assets of the Borrower or any of its subsidiaries
relating to any Environmental law or otherwise within the jurisdiction of any
Governmental Entity administering any Environmental Law.

                  "ENVIRONMENTAL NOTICE" means any claim, citation,
directive, request for information, statement of claim, notice of
investigation, letter or other communication, written or oral, actual or
threatened, from any Person to the Borrower or any of its subsidiaries
relating to any Environmental Laws.

                  "ENVIRONMENTAL PERMITS" includes all permits, certificates,
approvals, registrations and licences issued by any Governmental Entity to
the Borrower or any of its subsidiaries or to the Business pursuant to
Environmental Laws and required for the operation of the Business or the use
of the Owned Properties, Leased Properties or other Assets of the Borrower or
any of its subsidiaries.

                  "EVENT OF DEFAULT" has the meaning specified in Section
9.01.

                  "EXCESS CASH FLOW" means, for the Borrower, calculated at
the end of each quarter on a four quarter trailing basis (as set out in
Section 8.02(h)(2)), the sum of (i) Consolidated EBITDA of the Borrower; (ii)
any spread paid to the Borrower resulting from Back-to-Back Securities or
Existing Back-to-Back Securities, to the extent not previously included in
Consolidated EBITDA; LESS THE AGGREGATE for such period of (a) Consolidated
Interest Charges (excluding accrued interest paid on the Existing Notes and
the Existing Credit Agreement) paid in cash and not accrued; (b) taxes paid
in cash, net of recoveries and without duplication of same; (c)


                                       14


Capital Expenditures paid in cash made by the Borrower and its subsidiaries;
and (d) all regularly scheduled payments and all voluntary prepayments of the
Borrower's and its subsidiaries' Debt (other than (A) payments under the
Existing Notes and the Existing Credit Agreement, to the extent Defeasance
has occurred on the Closing Date; (B) voluntary repayments under Facility A
and the Overdraft Facility; and (C) voluntary repayments made using the
proceeds of permitted Dispositions of Assets, Permitted Debt described in
clauses (ii), (viii) and (x) of such definition, and the issuance of equity
securities), and minus the amount of extraordinary items not included in
earnings but which required the payment of cash. Notwithstanding the fact
that Excess Cash Flow is calculated on a four-quarter trailing basis, Excess
Cash Flow for the Financial Quarter ending (a) March 31, 2003, shall be
calculated based on the Excess Cash Flow in that Financial Quarter alone; (b)
June 30, 2003, shall be calculated based on the Excess Cash Flow in that
Financial Quarter and in the preceding Financial Quarter of 2003; (c)
September 30, 2003 shall be calculated based on the Excess Cash Flow in that
Financial Quarter and in the two preceding Financial Quarters of 2003; and
(d) December 31, 2003, shall be calculated based on the Excess Cash Flow in
the last four Financial Quarters.

                  "EXCESS CASH FLOW CERTIFICATE" has the meaning specified in
Section 8.01(a).

                  "EXISTING BACK-TO-BACK DEBT" means each of the 12.15%
Convertible Obligation due July 14, 2007 and 12.15% Convertible Obligation
due November 28, 2008 of the Borrower; the 12.25% Convertible Obligation due
July 14, 2007 of Bowes Publishers Limited; and the 12.25% Convertible
Obligation due November 28, 2008 of Sun Media (Toronto) Corporation, in each
case in aggregate principal amount outstanding on the Closing Date, with
respect to which each party thereto, other than a Loan Party, has executed a
subordination agreement in favour of the Administrative Agent for the Lenders
in substantially the form attached as Schedule 8.

                  "EXISTING BACK-TO-BACK SECURITIES" means the Existing
Back-to-Back Debt and the Existing Quebecor Preferred Shares.

                  "EXISTING QUEBECOR PREFERRED SHARES" means the 12.50%
Cumulative First Preferred Shares, Series A, of Quebecor Media Inc. in
aggregate liquidation amount outstanding on the Closing Date.

                  "EXISTING CREDIT AGREEMENT" means the existing credit
agreement among the Borrower and, INTER ALIA, Royal Bank of Canada as
Administrative Agent dated as of April 1, 2000, as amended, which is to be
the object of a Defeasance at Closing.

                  "EXISTING NOTES" means the existing senior subordinated notes
in an aggregate amount of approximately US$151,000,000 issued by the Borrower
and designated as "9-1/2% Senior Subordinated Notes due 2007", which are to be
the object of a Defeasance at Closing.

                  "FACE AMOUNT" means (i) in respect of a BA Instrument, the
amount payable to the holder on its maturity; and (ii) in respect of a Letter
of Credit, the maximum amount which the Issuing Lender is contingently liable
to pay to the beneficiary thereof.


                                       15


                  "FACILITY A" means the revolving credit facility in an
amount of up to Cdn.$75,000,000 to be made available to the Borrower under
this Agreement for the purposes specified in Section 2.03.

                  "FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a
fluctuating interest rate per annum equal, for each day during such period,
to the weighted average of the rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by Federal Funds brokers
as published for such day (or, if such day is not a Business Day, for the
immediately preceding Business Day) by the Federal Reserve Bank of New York
or, for any day on which such rate is not so published for such day by the
Federal Reserve Bank of New York, the average of the quotations for such day
for such transactions received by the Administrative Agent from three Federal
Funds brokers of recognized standing selected by the Administrative Agent. If
for any reason the Administrative Agent shall have determined (which
determination shall be conclusive, absent manifest error) that it is unable
to ascertain the Federal Funds Effective Rate for any reason, including
without limitation, the inability or failure of the Agent to obtain
sufficient bids or publications in accordance with the terms hereof, Bank of
America N.A.'s announced US Prime Rate will apply.

                  "FEES" means the fees payable by the Borrower under this
Agreement.

                  "FINANCIAL QUARTER" means, in respect of any Person, a
period of three consecutive months in each Financial Year of such Person
ending on March 31, June 30, September 30, and December 31, as the case may
be, of such year.

                  "FINANCIAL YEAR" means, in respect of any Person, its
financial year commencing on January 1 of each calendar year and ending on
December 31 of the same calendar year.

                  "FIXED CHARGE COVERAGE RATIO" means the ratio of
Consolidated EBITDA to Consolidated Fixed Charges, calculated in the manner
prescribed in Section 8.03(c) at such time.

                  "FLORIDA SUN" has the meaning attributed to it in the
definition of "Permitted Distribution".

                  "FUND" means any Person (other than a natural person) that
is (or will be) engaged in making, purchasing, holding or otherwise investing
in commercial loans and similar extensions of credit in the ordinary course
of its business.

                  "GAAP" means, at any time, accounting principles generally
accepted in Canada as recommended in the Handbook of the Canadian Institute
of Chartered Accountants at the relevant time applied on a consistent basis
(except for changes approved by the Borrower's independent auditors in
accordance with promulgations of the Canadian Institute of Chartered
Accountants).

                  "GOVERNMENTAL ENTITY" means any (i) multinational, federal,
provincial, state, municipal, local or other government, governmental or
public department, central bank, court, commission, board, bureau, agency or
instrumentality, domestic or foreign, (ii) any subdivision or


                                       16


authority of any of the foregoing, or (iii) any quasi-governmental or private
body exercising any regulatory, expropriation or taxing authority under or
for the account of any of the above.

                  "GUARANTORS" means each of the subsidiaries of the Borrower
as at the Closing Date other than Le Courrier du Sud (1998) Inc., all of
which are listed in Schedule 7 hereof, as well as each additional subsidiary
of the Borrower created or acquired after the Closing Date. Notwithstanding
the foregoing, a subsidiary of the Borrower which (i) is not wholly-owned,
directly or indirectly, by the Borrower, and (ii) the aggregate of whose
EBITDA or Assets, when considered together with the EBITDA or Assets of all
other subsidiaries that are not Guarantors, does not exceed 10% of the EBITDA
or Assets of the Borrower on a consolidated basis, shall not be required to
become a Guarantor for so long as the conditions set out in clauses (i), and
(ii) continue to apply; for the purposes hereof, "Assets" excludes the effect
of all Back-to-Back Transactions.

                  "HAZARDOUS SUBSTANCE" means any substance, waste, liquid,
gaseous or solid matter, fuel, micro-organism, sound, vibration, ray, heat,
odour, radiation, energy, plasma and organic or inorganic matter, alone or in
any combination which is regulated under any applicable Environmental Laws,
hazardous, hazardous waste, toxic, a pollutant, a deleterious substance, a
contaminant or a source of pollution or contamination under any Environmental
Law.

                  "HEDGING AGREEMENTS" means one or more agreements between
the Borrower and one or more of the Lenders or their Affiliates evidencing
(i) any interest rate hedge (including any interest rate swap, cap or
collars); or (ii) any foreign exchange hedge, as may be contemplated by the
Hedging Requirements or otherwise.

                  "HEDGING REQUIREMENTS" means Hedging Agreements implemented
by the Borrower hedging (i) its interest rate risk relating to its
Consolidated Debt in a notional principal amount necessary to ensure that at
least 35% of its Consolidated Debt is fixed rate Debt for a minimum period of
three years from the Closing Date; and (ii) its foreign exchange risk
relating to the Senior Notes (or any notes issued in replacement thereof) and
Term Facility B in a notional principal amount equal to 90% of the aggregate
principal amount of such notes and such Credit Facility and based on the term
to maturity of the Senior Notes and Term Facility B.

                  "HOLDCO" means 3535991 Canada Inc.

                  "IMPERMISSIBLE QUALIFICATION" means, relative to the
opinion or report of any independent auditors as to any financial statement,
any qualification or exception to such opinion or report which (i) is of a
"going concern" or similar nature; (ii) relates to any limited scope of
examination of material matters relevant to such financial statement, if such
limitation results from the refusal or failure of the Borrower to grant
access to necessary information therefor; and (iii) relates to the treatment
or classification of any item in such financial statement and which, as a
condition to its removal, would require an adjustment to such item the effect
of which could reasonably be expected to have a Material Adverse Effect.

                  "INDEMNIFIED PERSON" has the meaning specified in Section
12.06(1).


                                       17


                  "INTEREST COVERAGE RATIO" means the ratio of Consolidated
EBITDA to Consolidated Interest Charges, calculated in the manner prescribed
in Section 8.03(b) at such time.

                  "INVESTMENTS" means all investments, in cash or by delivery
of property, made directly or indirectly in any Person, whether by
acquisition of shares of capital stock, Indebtedness or other obligations or
securities or by loan, advance, capital contribution, guarantees or
otherwise, and includes any Acquisition; PROVIDED, HOWEVER, that
"Investments" shall not mean or include investments in cash or Cash
Equivalents or routine investments in inventory, equipment and supplies to be
used or consumed, or trade credit granted, in the ordinary course of the
Business.

                  "ISSUING LENDER" has the meaning attributed to it in the
definition of "Letter of Credit". For the purposes hereof, the Issuing Lender
shall be Bank of America N.A., Canada Branch, unless such Issuing Lender no
longer wishes to act as such, in which case the provisions of Section 10.09
hereof shall apply, MUTATIS MUTANDIS, except that only the Facility A Lenders
(and not the Term Lenders) shall appoint such replacement Issuing Lender.

                  "ISDA MASTER AGREEMENT" means the 1992 ISDA Master
Agreement (Multi-Currency - Cross Border) as published by the International
Swaps and Derivatives Association, Inc. and, where the context permits or
requires, includes all schedules, supplements, annexes and confirmations
attached thereto or incorporated therein, as such agreement may be amended,
supplemented or replaced from time to time.

                  "JUDICIAL ORDER" has the meaning specified in Section
5.04(1).

                  "LAWS" means, all legally enforceable statutes, codes,
ordinances, decrees, rules, regulations, municipal by-laws, judicial or
arbitral or administrative or ministerial or departmental or regulatory
judgments, orders, decisions, rulings or awards, policies, voluntary
restraints, guidelines, or any provisions of the foregoing, including general
principles of common and civil law and equity, binding on or affecting the
Person referred to in the context in which such word is used; and "LAW" means
any one of the foregoing.

                  "LEASED PROPERTIES" means the real properties at the
municipal addresses listed in Schedule 7.01(k) forming the subject matter of
the Leases to which the Borrower or any of its subsidiaries is a party.

                  "LEASES" means the leases and subleases of real property to
which the Borrower or any of its subsidiaries is a party providing, in each
case, for annual rental payments in respect thereof of an amount greater than
$500,000, as listed and described in Schedule 7.01(k) and such other leases
and subleases to which the Borrower or any of its subsidiaries is a party
providing, in each case, for annual rental payments in respect thereof of an
amount greater than $500,000, as the Administrative Agent may, from time to
time, be notified by the Borrower.



                                      18


                  "LENDERS" means, collectively, the financial institutions and
other Persons set forth on the signature pages hereof as Lenders, and any
Assignee thereof upon such Assignee executing and delivering an assignment and
assumption agreement referred to in Section 12.08(5) to the Borrower and the
Administrative Agent and in the singular any one of such Lenders. A Lender
which, at any relevant time, has (i) a Lender's Facility A Commitment is
sometimes referred to herein as a "FACILITY A LENDER"; (ii) a Swingline Lender's
Commitment is sometimes referred to herein as a "SWINGLINE LENDER"; (iii) a
Lender's Term Credit Commitment is sometimes referred to herein as a "TERM
LENDER". When used in connection with "Hedging Agreements", the term "Lender"
shall include any Affiliate of a Lender. When used in connection with the
Security, the term "Lender" shall include the provider of the Overdraft Facility
and any counterparty to a Hedging Agreement, provided that the counterparty was
a Lender or an Affiliate of a Lender, at the time any such Hedging Agreement was
entered into. Prior to the occurrence of any Event of Default which has not been
waived, each Facility A Lender shall not be a non-resident of Canada within the
meaning of the INCOME TAX ACT (Canada).

                  "LETTER OF CREDIT" means a Cdn. $ denominated letter of credit
or a letter of guarantee issued or to be issued by an Issuing Lender (an
"ISSUING LENDER") under Facility A for the account of the Borrower, issued in
the name of the Borrower or any of its subsidiaries pursuant to Article 5.

                  "LEVERAGE RATIO" means, at any time, the ratio of Consolidated
Debt of the Borrower and its subsidiaries to Consolidated EBITDA, calculated in
the manner prescribed in Section 8.03(a) at such time.

                  "LIBOR" means, with respect to any Designated Period
relating to a Libor Advance:

         (a) the rate per annum equal to the rate determined by the
         Administrative Agent to be the offered rate that appears on the page of
         the Telerate screen (or any successor thereto) that displays an average
         British Bankers Association Interest Settlement Rate for deposits in US
         Dollars (for delivery on the first day of such Designated Period) with
         a term equivalent to such Designated Period, determined as of
         approximately 11:00 a.m. (London time) two Business Days prior to the
         first day of such Designated Period, or
         (b) if the rate referenced in the preceding clause (a) does not
         appear on such page or service or such page or service shall not be
         available, the rate per annum equal to the rate determined by the
         Administrative Agent to be the offered rate on such other page or
         other service that displays an average British Bankers Association
         Interest Settlement Rate for deposits in US Dollars (for delivery on
         the first day of such Designated Period) with a term equivalent to
         such Designated Period, determined as of approximately 11:00 a.m.
         (London time) two Business Days prior to the first day of such
         Designated Period, or
         (c) if the rates referenced in the preceding clauses (a) and (b) are
         not available, the rate per annum determined by the Administrative
         Agent as the rate of interest at which deposits in US Dollars for
         delivery on the first day of such Designated Period in same day
         funds in the approximate amount of the Libor Advance being made,
         continued



                                      19

         or converted by the Lender that is the Administrative Agent and with
         a term equivalent to such Designated Period as would be offered by
         the Lender that is the Administrative Agent's London Branch (or, if
         it has none, Bank of America's London Branch) to major banks in the
         London interbank eurodollar market at their request at approximately
         4:00 p.m. (London time) two Business Days prior to the first day of
         such Designated Period.

With respect to a Libor Advance to be made by a Lender which is subject to the
regulations issued from time to time by the Board of Governors of the Federal
Reserve System in the USA in respect of such Libor Advances, the rate determined
in paragraphs (a), (b) or (c) above (the "QUOTED RATE") shall be adjusted for
reserve requirements in accordance with the following formula to obtain the
applicable LIBOR:

LIBOR=           QUOTED RATE
         -------------------------
         1.00 - Reserve Percentage

where "RESERVE PERCENTAGE" means the rate (expressed as a decimal) applicable to
the relevant Lender, during the relevant Designated Period under regulations,
directives or guidelines issued from time to time by the Board of Governors of
the Federal Reserve System (in the USA) or any successor thereof, for
determining the reserve requirement applicable to the Facility or to facilities
similar thereto (including any basic, supplemental, emergency or marginal
reserve requirement) of such Lender, respectively, with respect to "Eurocurrency
liabilities", as that term is defined under such regulations or for the purposes
of complying with such directives or guidelines. All adjustments to the Quoted
Rate shall occur and be effective as of the effective date of any change in the
Reserve Percentage, and the Administrative Agent will use reasonable efforts to
advise the Borrower of any such change as soon as practicable (provided that the
Administrative Agent shall not be liable if it fails to do so).

                  "LIBOR ADVANCE" means, at any time, the part of the Advances
in US$ under Term Facility B with respect to which the Borrower has chosen to
pay interest on the Libor Basis.

                  "LIBOR BASIS" means the basis of calculation of interest on
Libor Advances, or any part thereof, made in accordance with the provisions of
Section 3.10.

                  "LIEN" means liens, charges, mortgages, pledges, Security
Interests, adverse claims, defects of title, restrictions, deposit arrangements,
voting trusts, any other rights of third parties relating to any property and
any other lien of any kind.

                  "LOAN PARTIES" means the Borrower and the Guarantors.

                  "LOSS" means any loss whatsoever, whether direct or indirect,
including expenses, costs, damages, judgments, penalties, fines, charges,
claims, demands, liabilities and any and all legal fees and disbursements,
except any such loss representing loss of profit.

                  "MAJORITY LENDERS" means, at any time, Lenders whose
Commitments, taken together, are more than 50% of the aggregate amount of
the Commitments.



                                      20

                  "MANDATORY BORROWING" has the meaning specified in Section
3.01(2).

                  "MANDATORY PREPAYMENT" has the meaning specified in Section
2.05.

                  "MATERIAL ADVERSE EFFECT" means, with respect to any event or
occurrence of whatever nature (including any adverse determination in any
litigation, arbitration or governmental investigation or proceeding), (a) a
material adverse effect on the Business, properties, prospects, condition
(financial or otherwise), assets, operations or income of the Borrower and its
subsidiaries, taken as a whole, (b) a material adverse effect on the ability of
the Borrower or any of the Guarantors, individually (to the extent material) and
taken as a whole, to perform any of their respective material obligations under
any of the Credit Documents to which they are a party, or (c) any impairment of
the validity, binding effect or enforceability of this Credit Agreement or any
material impairment of the rights, remedies or benefits available to the
Administrative Agent or any Lender under any material Credit Document.

                  "MATERIAL AGREEMENTS" means the agreements described in
Schedule 7.01(s) and such other agreements of which the Administrative Agent
may, from time to time, be notified by the Borrower, in each case where such
agreements are necessary to the Business and the absence of which would
reasonably be expected to have a Material Adverse Effect.

                  "NEGATIVE VALUE OF HEDGING AGREEMENTS" means the aggregate
amount that would be payable to all Persons by the Borrower on the date of
determination pursuant to Section 6(e)(ii)(2)(A) of each ISDA Master Agreement
between the Borrower and such Persons as if all hedging agreements under such
ISDA Master Agreements were being terminated on that day; provided that, with
respect to the Hedging Agreements between each Lender and the Borrower, each
Lender will determine Market Quotation (as such term is defined in the ISDA
Master Agreement) using its estimates at mid-market of the amounts that would be
paid for Replacement Transactions (as such term is defined in the ISDA Master
Agreement).

                  "NET PROCEEDS" means any one or more of the following (i) with
respect to any Disposition of Assets by the Borrower or any of its subsidiaries,
the net amount equal to the aggregate amount received in cash (including any
cash received by way of deferred payment pursuant to a note, receivable, other
non-cash consideration or otherwise, but only as and when such cash is so
received) in connection with such Disposition, less the sum of (x) amounts
payable to discharge or radiate Permitted Liens on the Assets being Disposed of,
(y) reasonable fees (including, without limitation, reasonable legal fees),
commissions and other out-of-pocket expenses incurred or paid for by the
Borrower or such subsidiary in connection with such Disposition, and (z) taxes
incurred in connection with such Disposition, whether payable at such time or
thereafter; (ii) with respect to the issuance or creation of Debt, whether
private or public, of any Person or any of its subsidiaries, the net amount
equal to the aggregate amount received in cash in connection with such creation
or issuance, less the reasonable fees (including without limitation, reasonable
legal fees), commissions and other out-of-pocket expenses incurred or paid for
by such Person or such subsidiary in connection with such creation or issuance;
and (iii) with respect to the issuance of any securities by any Person or of any
capital contributions by any Person in such



                                      21

Person, the net amount equal to the aggregate amount received in cash in
connection with such issuance or contribution by any Person in such Person
less the reasonable fees (including without limitation, reasonable legal
fees), commissions and other out-of-pocket expenses, and without duplication;
but in each case excluding, as a deduction from amounts received, any amounts
paid to Affiliates.

                  "OVERDRAFT FACILITY" means a credit facility of which notice
has been provided by the Borrower to the Administrative Agent, available to the
Borrower from time to time from a reputable financial institution, in respect of
bank overdrafts (and letters of credit in respect thereof) in the ordinary
course of the Business, in an aggregate principal amount not exceeding
$5,000,000.

                  "OWNED  PROPERTIES"  means,  collectively,  the land and
premises  listed on Schedule  7.01(j) and the  Buildings and Fixtures thereon.

                  "PARTICIPANT" has the meaning specified in Section 12.08(3).

                  "PELADEAU GROUP" means any (i) individual who is related by
blood, adoption or marriage to the late Pierre Peladeau, (ii) any trust (whether
testamentary or otherwise) the beneficiaries of which are all individuals
described in (i); or (iii) any corporation or partnership which is controlled,
directly or indirectly, by one or more individuals referred to in (i) or a trust
referred to in (ii), or any combination thereof.

                  "PERMITTED ACQUISITION" has the meaning ascribed to it in
the definition of "Permitted Investment".

                  "PERMITTED DEBT" means (i) the Senior Notes; (ii) Subordinated
Debt; (iii) Back-to-Back Securities and Existing Back-to-Back Securities (iv)
Debt owed by a Guarantor to the Borrower or vice versa, or by a Guarantor to any
other Guarantor; (v) obligations pursuant to the Hedging Agreements or other
hedging arrangements permitted hereunder; (vi) Debt secured by Purchase Money
Mortgages permitted hereunder; (vii) Debt in respect of Permitted Acquisitions
in a principal amount of up to $50,000,000 for each Permitted Acquisition for a
period of up to 90 days after the date such Permitted Acquisition was made;
(viii) additional Debt, not otherwise provided for herein, not in excess of
$50,000,000 outstanding at any time; (ix) indebtedness of the Borrower under the
Overdraft Facility ; and (x) any indebtedness incurred to refinance or replace
any of the foregoing other than under clause (vii) above; provided that with
respect to the Permitted Debt referred to in clauses (v), (vi), (vii) and
(viii), no Default shall have occurred and be continuing and no Event of Default
shall have occurred and not been waived at the time of the incurrence of such
Debt.

                  "PERMITTED DISTRIBUTION" means (i) the payment of an amount of
Cdn.$260,000,000 on or about the Closing Date, directly or indirectly, to
Quebecor Media Inc. by way of loans, dividends, return of capital or share
repurchases and the repayment of the Existing Notes and any interest or premium
in respect thereof and amounts owing under the Existing Credit Agreement; and
(ii) Distributions by a Guarantor to the Borrower or by a subsidiary of the



                                      22


Borrower to any Guarantor or to the Borrower. In addition, provided that no
Event of Default has occurred which has not been waived by the Lenders,
"Permitted Distributions" shall also mean (a) payments on account of regularly
scheduled instalments of principal and interest on Permitted Debt (including a
premium and fees, if any, thereon), other than the Senior Notes or any
Subordinated Debt (b) regularly scheduled payments of interest on the Senior
Notes and on Subordinated Debt; (c) payments made in connection with or in
respect of the Back-to-Back Securities or the Existing Back-to-Back Securities;
provided, however, that to the extent such payments are made to any Affiliates
of the Borrower that are not Loan Parties, all corresponding payments required
to be paid by such Affiliates pursuant to the related Back-to-Back Securities or
Existing Back-to-Back Securities are received, immediately prior to,
concurrently with or immediately subsequent to any such payments, by all
applicable Loan Parties, and each such payment by a Loan Party shall be
conditional upon receipt of an equal or greater amount from such non-Loan Party
Affiliate; (d) any Tax Benefit Transaction; (e) the redemption or repayment of
up to $50,000,000 of Senior Notes (and, for greater certainty, no other
prepayment of the Senior Notes will be permitted, from any source (other than
new Subordinated Debt), without the consent of the Majority Lenders who have
Commitments at the time of any such proposed prepayment); (f) the payment of
Additional Distributions directly or indirectly to Quebecor Media Inc. by way of
loans, dividends, return of capital or share repurchase; (g) the payment of the
proceeds of the sale of Toronto Sun International Inc., its subsidiaries or all
or substantially all of their respective Assets (hereinafter, the "FLORIDA
SUN"), if the Disposition in question occurs within 60 days following the
Closing Date; (h) the payment of amounts required to be paid under the joint
Quebecor/Sun Media pension plan with respect to employees of the Loan Parties
alone; (i) the payment of a management fee or other similar expense by the
Borrower to its direct or indirect parent company for bona fide services
(including reimbursement for expenses incurred in connection with, or allocation
of corporate expenses in relation to, providing such services) provided to, and
directly related to the operations of, the Loan Parties, in an aggregate amount
not to exceed 1.25% of consolidated revenues (being gross revenues calculated in
accordance with GAAP less any amounts derived from subsidiaries that are not
Loan Parties, and save that any portion of such gross revenues derived from a
Person that is not a subsidiary of the Borrower accounted for by the equity
method of accounting shall be included in such calculation only to the extent of
the amount of dividends or distributions actually paid to a Loan Party by such
Person) in any twelve-month period; and (j) the payment out of Excess Cash Flow
of certain other amounts, directly or indirectly, to Quebecor Media Inc. by way
of loans, dividends, return of capital or share repurchases, the amount of which
shall not exceed an amount equal to 50% of the Excess Cash Flow reported at the
end of the previous Financial Quarter in the Excess Cash Flow Certificate until
such time as the Leverage Ratio reported in respect of the end of such previous
Financial Quarter is less than 3.00:1 (at which point the Permitted Distribution
will be up to 100% of Excess Cash Flow as long as the Leverage Ratio remains
less than 3.00:1), and subject to having first provided to the Administrative
Agent an Excess Cash Flow Certificate (as required by subsection 8.01 (a))
attesting as to the Excess Cash Flow in respect of the particular period in
question, and deducting therefrom any amount of Excess Cash Flow used to make a
Permitted Investment (such that the same amount of Excess Cash Flow cannot be
used both for a Permitted Distribution and a Permitted Investment). Each payment
of a Permitted Distribution of Excess Cash Flow shall be calculated and made
subject to and in accordance with the provisions of Section 8.02(h)(2) hereof.



                                      23


                  "PERMITTED INVESTMENT" means (A) any Investment in
Back-to-Back Securities or Existing Back-to-Back Securities or in connection
with Tax Benefit Transactions and (B) (i) any Investment made out of the portion
of Excess Cash Flow available to the Borrower to make a Permitted Distribution
that is not used to make a Permitted Distribution; and (ii) any other
Investments (including any Acquisitions) in an aggregate amount of up to
$50,000,000 during the entire Term of the later to expire of Facility A or Term
Facility B (a "PERMITTED ACQUISITION") provided that after giving effect to such
Investment or Acquisition and any Accommodation made under the Credit Facilities
to fund all or any part of the purchase price of such Acquisition, no Default
shall have occurred and be continuing, and no Event of Default shall have
occurred and not been waived, and, for greater certainty, the Borrower will be
in compliance with the financial covenants set forth in Section 8.03.

                  "PERMITTED LIENS" means, in respect of any Person, any one
or more of the following:

         (a) Liens for taxes, assessments or governmental charges or levies
         which are not delinquent or the validity of which is being contested at
         the time by the Person in good faith by proper legal proceedings if, in
         the Administrative Agent's opinion, either (i) adequate provision has
         been made for their payment, or (ii) the Liens are not in the aggregate
         materially prejudicial to the security constituted by the Security
         Documents;

         (b) inchoate or statutory Liens of contractors, subcontractors,
         mechanics, workers, suppliers, materialmen, carriers and others in
         respect of construction, maintenance, repair or operation of assets of
         the Person, provided that such Liens are related to obligations not due
         or delinquent are not registered against title to any assets of the
         Person and in respect of which adequate holdbacks are being maintained
         as required by applicable law or such Liens are being contested in good
         faith by appropriate proceedings and in respect of which there has been
         set aside a reserve (segregated to the extent required by GAAP) in an
         adequate amount and provided further that such Liens do not, in the
         Administrative Agent's opinion, materially reduce the value of the
         Assets of the Person or materially interfere with the use of such
         Assets in the operation of the business of the Person;

         (c) easements, rights-of-way, servitudes, restrictions and similar
         rights in real property comprised in the Assets of the Person or
         interests therein granted or reserved to other Persons, provided that
         such rights do not, in the Administrative Agent's opinion, materially
         reduce the value of the Assets of the Person or materially interfere
         with the use of such Assets in the operation of the business of the
         Person;

         (d) title defects or irregularities which are of a minor nature and
         which, in the Administrative Agent's opinion, do not materially reduce
         the value of the Assets of the Person or materially interfere with
         their use in the operation of the business of the Person;

         (e) Liens securing appeal bonds and other similar Liens arising in
         connection with court proceedings (including, without limitation,
         surety bonds, security for costs of litigation



                                      24

         where required by law and letters of credit) or any other
         instruments serving a similar purpose, which do not, in the
         Administrative Agent's opinion, materially reduce the value of the
         Assets of the Person or materially interfere with their use in the
         operations of the business of the Person;

         (f) attachments, judgments and other similar Liens arising in
         connection with court proceedings; provided, however, that the Liens
         are in existence for less than 10 days after their creation or the
         execution or other enforcement of the Liens is effectively stayed or
         the claims so secured are being actively contested in good faith and by
         proper legal proceedings;

         (g) the reservations, limitations, provisos and conditions, if any,
         expressed in any original grant from the Crown of any real property or
         any interest therein or in any comparable grant in jurisdictions other
         than Canada, provided they do not, in the Administrative Agent's
         opinion, materially reduce the value of the Assets of the Person or
         materially interfere with the use of such Assets in the operation of
         the business of the Person;

         (h) Liens given to a public utility or any municipality or governmental
         or other public authority when required by such utility or other
         authority in connection with the operation of the business or the
         ownership of the Assets of the Person, provided that such Liens do not,
         in the Administrative Agent's opinion, materially reduce the value of
         the Assets of the Person or materially interfere with their use in the
         operation of the business of the Person;

         (i) servicing agreements, development agreements, site plan agreements,
         and other agreements with Governmental Entities pertaining to the use
         or development of any of the Assets of the Person, provided same are
         complied with and do not in the Administrative Agent's opinion,
         materially reduce the value of the Assets of the Person or materially
         interfere with their use in the operation of the business of the Person
         including, without limitation, any obligations to deliver letters of
         credit and other security as required;

         (j) applicable municipal and other governmental restrictions, including
         municipal by-laws and regulations, affecting the use of land or the
         nature of any structures which may be erected thereon, provided such
         restrictions have been complied with and do not in the Administrative
         Agent's opinion, materially reduce the value of the Assets of the
         Person or materially interfere with their use in the operation of the
         business of the Person;

         (k) the right reserved to or vested in any Governmental Entity by any
         statutory provision or by the terms of any lease, licence, franchise,
         grant or permit of the Person, to terminate any such lease, licence,
         franchise, grant or permit, or to require annual or other payments as a
         condition to the continuance thereof;

         (l)      Liens in favour of the Administrative Agent and the Lenders
         created by the Security Documents;



                                      25

         (m) Liens in favour of a Lender securing amounts under the Hedging
         Agreements in respect of the Hedging Requirements and other Hedging
         Agreements entered into in accordance with the provisions of Section
         8.02 (i) which rank, as to priority, PARI PASSU with the Accommodations
         Outstanding and any other amounts owing hereunder;

         (n) Liens granted by a Loan Party in favour of a Loan Party;

         (o) a Lien of the interest of such Person in any non-wholly owned
         partnership or corporation that is granted under the terms of the
         partnership or shareholders agreement to secure the obligations of such
         Person to the other partners or shareholders under that agreement,
         provided that such Person has the benefit of a similar Lien over the
         interests of the other partners or shareholders;

         (p) Purchase Money Mortgages in an aggregate amount outstanding at
         any time not exceeding $15,000,000;

         (q) Liens to secure the Overdraft Facility;

         (r) Liens to secure the Debt referred to in clause (viii) of the
         definition of "Permitted Debt", up to an aggregate maximum outstanding
         at any time not exceeding $25,000,000;

         (s) Any rights of a landlord or sub-landlord under applicable Law or
         the rights of a lessor or sub-lessor under an operating lease;

         (t) Deposits to secure the performance of leases of property in the
         ordinary course of business; and

         (u) Any renewal, extension, substitution, replacement or refinancing
         of the foregoing.

                  "PERSON" means a natural person, partnership, corporation,
joint stock company, trust, unincorporated association, joint venture or other
entity or Governmental Entity, and pronouns that have a similarly extended
meaning.

                  "PRIME RATE ADVANCE" means, at any time, the portion of the
Advances in Canadian Dollars with respect to which the Borrower has chosen, or,
in accordance with the provisions hereof, is obliged, to pay interest calculated
in accordance with the provisions of Section 3.08.

                  "PURCHASE MONEY MORTGAGE" means, in respect of any Person, any
Security Interest charging property acquired by such Person, which is granted or
assumed by such Person in connection with the acquisition of such property and
within not more than 60 days following such acquisition, reserved by the
transferor (including any reservation of title in respect of any lease recorded
as a capital lease) or which arises by operation of Law in favour of the
transferor concurrently with and for the purpose of the acquisition of such
property, in each case where (i)



                                      26

the principal amount secured by such Security Interest is not in excess of
the cost to such Person of the property acquired; and (ii) such Security
Interest extends only to the property acquired.

                  "QUEBECOR" means Quebecor Inc., a corporation incorporated and
subsisting under the laws of Quebec.

                  "REFERENCE DISCOUNT RATE" means, for any Drawing Date, in
respect of any Bankers' Acceptances or Drafts to be purchased pursuant to
Article 4 by (i) a Schedule I chartered bank, the average Bankers' Acceptance
discount rate for the appropriate term as quoted on Reuters Screen CDOR Page (or
such other page as is a replacement page for such Bankers' Acceptances) at 10:00
a.m. (Toronto time); and (ii) by any other Lender or Person, the lesser of (y)
the arithmetic average of the actual discount rate quoted by at least one, but
not more than two, Schedule II Reference Banks; and (z) the rate specified in
(i) plus 0.10%. If such rate is not available as of such time, then the discount
rate in respect of such Banker's Acceptances and Drafts shall mean the
arithmetic average of the discount rates (calculated on an annual basis and
rounded to the nearest one-hundredth of 1%, with five-thousandths of 1% being
rounded up) quoted by Bank of America N.A., Canada Branch and Royal Bank of
Canada at 10:00 a.m. (Toronto time) as the discount rate at which each such
Lender would purchase, on the relevant Drawing Date, its own Bankers'
Acceptances or Drafts having an aggregate Face Amount equal to and with a term
to maturity the same as the Bankers' Acceptances or Drafts to be acquired by
such Lender or other Person on such Drawing Date.

                  "RELEASE" when used as a verb includes release, spill, leak,
emit, deposit, discharge, leach, migrate or dispose into the environment and the
term "RELEASE" when used as a noun has a correlative meaning, but does not
include any emission or discharge pursuant to a valid Environmental Permit.

                  "REMEDIAL ACTION" means any action required under any
applicable Environmental Law to (i) clean up, remove, treat or in any other way
deal with Hazardous Substances in the environment; (ii) prevent any Release of
Hazardous Substances where such Release would violate any Environmental Laws or
would endanger or threaten to endanger public health or welfare or the
environment; or (iii) perform remedial studies, investigations, restoration and
post-remedial studies, investigations and monitoring on, about or in connection
with any of the Owned Properties, the Leased Properties or other Assets of the
Borrower and its subsidiaries.

                  "SCHEDULE II REFERENCE BANKS" means Bank of America, N.A,
Canada Branch and Credit Suisse First Boston, Toronto Branch.

                  "SECURITY" means, at any time, the Security Interests in
favour of the Administrative Agent or the Lenders, or both, in the Assets and
properties of the Borrower and the Guarantors (save for Assets excluded under
the Security Documents) securing their obligations under this Agreement or the
other Credit Documents (excluding the subordination agreements referred to in
that definition), including for greater certainty the obligations under the
Hedging Agreements and the Overdraft Facility.



                                      27


                  "SECURITY DOCUMENTS" means the agreements described in
Schedule 5 and annexed thereto and any other Security granted to the
Administrative Agent or the Lenders, or both (including Security granted by a
new Guarantor), as security for the obligations of the Borrower and the
Guarantors under this Agreement, the other Credit Documents (excluding the
subordination agreements referred to in that definition) and, for greater
certainty, the Overdraft Facility.

                  "SECURITY INTEREST" means any hypothec, mortgage, pledge,
security interest, encumbrance, lien, charge or deposit arrangement or any other
arrangement or condition that in substance secures payment or performance of an
obligation and includes the interest of a vendor or lessor under any conditional
sale agreement, capitalized lease or other title retention agreement.

                  "SELECTED AMOUNT" means, with respect to a Libor Advance, the
amount in respect of which the Borrower has asked, in accordance with Section
3.02, that the interest payable thereon be calculated on the Libor Basis.

                  "SENIOR NOTES" means the notes created under the Senior
Note Indenture and dated as of February 7, 2003, designated as "7-5/8% Senior
Notes" , and maturing on February 15, 2013 , as same may be amended, modified
or supplemented from time to time, provided that no such amendment shall
affect the unsecured nature of the Senior Notes, nor shall it shorten the
maturity of the Senior Notes to any period which is less than one year
following the expiry of the Term of the last to expire of Facility A or Term
Facility B.

                  "SENIOR NOTE INDENTURE" means the trust indenture dated as of
February 7, 2003 between National City Bank and the Borrower under which the
Senior Notes were issued, as same may be amended, modified or supplemented from
time to time, provided that no such amendment shall affect the unsecured nature
of the Senior Notes, nor shall it shorten the maturity of the Senior Notes to
any period which is less than one year following the expiry of the Term of the
last to expire of Facility A or Term Facility B.

                  "SUBSIDIARY" means any Person in respect of which the majority
of the issued and outstanding capital stock (including securities convertible
into voting shares and options to purchase voting shares) granting a right to
vote in all circumstances is at the relevant time owned by the Borrower and/or
one or more of its subsidiaries, and includes a partnership and limited
partnership that would be an Affiliate if it were a corporation. The
subsidiaries of the Borrower are listed in Schedule 7.01(a).

                  "SUBORDINATED DEBT" means, in respect of any Person, Debt of
such Person which (i) has covenants, events of default and redemption,
repurchase and modification provisions, in the aggregate, that are not
materially less favorable to such Person than the covenants, events of default
and redemption, repurchase and modification provisions of the Senior Notes as in
effect on the Closing Date; (ii) have no required redemption provisions and
mature after the later of the expiry of the Term of Facility A or Facility B;
(iii) are unsecured; (iv) have no payment of interest following an Event of
Default which has not been waived, and do not contemplate any payment of
principal, voluntary (except out of the proceeds of the issuance of other
Subordinated Debt, and not following a Default which has occurred and is
continuing or an Event of Default which has not been waived)



                                      28

or involuntary, at any time prior to the expiry of the Term of the last to
expire of Facility A or Term Facility B; and (v) provides that the
Accommodations Outstanding and any other amounts payable hereunder or under
any Credit Document will have the benefit of such subordination terms.

                  "SWINGLINE LENDER" means the Lender which has provided a
Swingline Commitment hereunder. For the purposes hereof, the Swingline Lender
shall be Bank of America N.A., Canada Branch, unless such Swingline Lender no
longer wishes to act as such, in which case the provisions of Section 10.09
hereof shall apply, MUTATIS MUTANDIS, except that only the Facility A Lenders
(and not the Term Lenders) shall appoint such replacement Swingline Lender.

                  "SYNTHETIC LEASE" means any synthetic lease or similar
off-balance sheet financing product where such transaction is considered
borrowed money for tax purposes but is classified as an operating lease in
accordance with GAAP.

                  "TAX BENEFIT TRANSACTION" means, for so long as the Borrower
is a direct or indirect subsidiary of Quebecor, any transaction between a Loan
Party and Quebecor or any of its Affiliates, the primary purpose of which is to
create tax benefits for any Loan Party or for Quebecor or any of its Affiliates;
PROVIDED, HOWEVER, that (1) the Loan Party involved in the transaction obtains a
favorable tax ruling from a competent tax authority or a favorable tax opinion
from a nationally recognized Canadian law or accounting firm having a tax
practice of national standing as to the tax efficiency of the transaction for
such Loan Party; (2) the Borrower delivers to the Administrative Agent (a) a
resolution of the board of directors of the Borrower to the effect the
transaction will not prejudice the Lenders and certifying that such transaction
has been approved by a majority of the disinterested members of such board of
directors and (b) an opinion as to the fairness to such Loan Party of such
transaction from a financial point of view issued by an accounting, appraisal or
investment banking firm of national standing in the United States or Canada; (3)
such transaction is set forth in writing; and (4) the Consolidated EBITDA of the
Borrower is not reduced after giving PRO FORMA effect to the transaction as if
the same had occurred at the beginning of the most recently ended four fiscal
quarter period of the Borrower for which internal financial statements are
available; PROVIDED, HOWEVER, that if such transaction shall thereafter cease to
satisfy the preceding requirements as a Tax Benefit Transaction, it shall
thereafter cease to be a Tax Benefit Transaction for purposes of this Agreement
and shall be deemed to have been effected as of such date and, if the
transaction is not otherwise permitted by this Agreement as of such date, the
Borrower will be in Default hereunder if such transaction does not comply with
the preceding requirements or is not otherwise unwound within 30 days of that
date.

                  "TAXES" has the meaning specified in Section 12.07(1).

                  "TERM" means the period commencing on the Closing Date and
terminating with respect to (i) Facility A, five (5) years therefrom, and (ii)
Term Facility B, six (6) years therefrom.



                                      29

                  "TERM  FACILITY B" means the term credit facility in an
amount of  US$230,000,000  made available to the Borrower in accordance with
Article 2.

                  "US PRIME RATE" means, for any day, a fluctuating rate per
annum (expressed as an annual rate calculated based on a 365 or 366 day year, as
the case may be) equal to the higher of (a) the Federal Funds Effective Rate
plus 1/2 of 1% and (b) the rate of interest in effect for such day as publicly
announced from time to time by Bank of America as its "prime rate" in the U.S.A.
The "prime rate" is a rate set by Bank of America based upon various factors
including Bank of America's costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.

                  "US PRIME RATE  ADVANCE"  means, at any time, the part of
the Advances in US $ in respect of which interest is calculated in
accordance with the provisions of Section 3.09.

                  "US DOLLARS" or "US $" means the lawful currency of the United
States of America in same day immediately available funds or, if such funds are
not available, the currency of the United States of America which is ordinarily
used in the settlement of international banking operations on the day on which
any payment or any calculation must be made pursuant to this Agreement;

                  SECTION 1.02. GENDER AND NUMBER.  Any reference in the
Credit Documents to gender includes all genders, and words importing the
singular number only include the plural and vice versa.

                  SECTION 1.03. INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.
The provisions of a Table of Contents, the division of this Agreement into
Articles and Sections and the insertion of headings are for convenience of
reference only and shall not affect the interpretation of this Agreement.

                  SECTION 1.04. CURRENCY.  All references in the Credit
Documents  to  dollars,  unless  otherwise  specifically indicated, are
expressed in Canadian currency.

                  SECTION 1.05. CERTAIN PHRASES, ETC. In any Credit Document (i)
(y) the words "including" and "includes" mean "including (or includes) without
limitation" and (z) the phrase "the aggregate of", "the total of", "the sum of",
or a phrase of similar meaning means "the aggregate (or total or sum), without
duplication, of", and (ii) in the computation of periods of time from a
specified date to a later specified date, unless otherwise expressly stated, the
word "from" means "from and including" and the words "to" and "until" each mean
"to but excluding".

                  SECTION 1.06. ACCOUNTING  TERMS.  All  accounting  terms
not  specifically  defined  in this  Agreement  shall be interpreted in
accordance with GAAP.



                                      30

                  SECTION 1.07. NON-BUSINESS DAYS. Whenever any payment is
stated to be due on a day which is not a Business Day, such payment shall be
made on the next succeeding Business Day, and such extension of time shall be
included in the computation of interest or Fees, as the case may be.

                  SECTION 1.08. RATEABLE PORTION OF ACCOMMODATIONS. References
in this Agreement to a Lender's rateable portion of Advances, Drawings, Letters
of Credit, Drafts and Banker's Acceptances or rateable share of payments of
principal, interest, Fees or any other amount, shall mean and refer to a
rateable portion or share as nearly as may be rateable in the circumstances, as
determined in good faith by the Administrative Agent. Each such determination by
the Administrative Agent shall be PRIMA FACIE evidence of such rateable share.

                  SECTION 1.09. INCORPORATION  OF SCHEDULES.  The schedules
attached to this Agreement  shall, for all purposes of this Agreement, form
an integral part of it.

                                    ARTICLE 2
                                CREDIT FACILITY

                  SECTION 2.01. AVAILABILITY. (1) Each Lender individually and
not jointly and severally (or solidarily) agrees, on the terms and conditions of
this Agreement, to make Accommodations rateably to the Borrower in accordance
with such Lender's Facility A Commitment and / or Term Credit Commitment.
Accommodations under Facility A may be made available as (i) Prime Rate Advances
and Swingline Advances, where applicable, pursuant to Article 3; (ii) Bankers'
Acceptances pursuant to Article 4; or Letters of Credit under Article 5.
Accommodations under Term Facility B may be made available as Libor Advances or
as US Prime Rate Advances. The Swingline Lender agrees, on the terms and
conditions of this Agreement, to make Swingline Advances to the Borrower in
accordance with its Swingline Commitment. The Issuing Lender agrees, on the
terms and conditions of this Agreement, to make Letters of Credit available to
the Borrower in accordance with the provisions of Article 5.

                  (2) The failure of any Lender to make an Accommodation shall
not relieve any other Lender of its obligation, if any, in connection with any
such Accommodation, but no Lender is responsible for any other Lender's failure
in respect of such Accommodation.

                  (3) The Administrative Agent shall give each Lender prompt
notice of any (i) Accommodation Notice received from the Borrower and of each
Lender's rateable portion of any Accommodation; and (ii) other notice received
by it from the Borrower under this Agreement.

                  SECTION 2.02. COMMITMENTS AND FACILITY LIMITS. (1) The
Accommodations Outstanding (i) to all Facility A Lenders under Facility A shall
not at any time exceed the Facility A Commitment; and (ii) to each Facility A
Lender under Facility A shall not at any time exceed such Lender's Facility A
Commitment (provided, for greater certainty, that the Swingline



                                      31

Lender's Facility A Commitment shall not be reduced by more than its rateable
portion of Swingline Advances made or to be made by it in its capacity as
Swingline Lender, and the Issuing Lender's Facility A Commitment shall not be
reduced by more than its rateable portion of the Accommodations Outstanding
by Letter of Credit made or to be made by it in its capacity as Issuing
Lender). The principal amount of all Swingline Advances outstanding to the
Swingline Lender shall not, at any time, exceed the Swingline Commitment,
which shall itself not exceed Cdn.$5,000,000. The aggregate Face Amount of
Letters of Credit outstanding shall not at any time exceed Cdn.$2,000,000.
The Accommodations Outstanding (a) to all Term Lenders under Term Facility B
shall not at any time exceed the Term Credit Commitment; and (b) to each Term
Lender under Term Facility B shall not at any time exceed such Lender's Term
Credit Commitment.

                  (2) Facility A shall revolve and, except as otherwise provided
herein, no payment under Facility A shall reduce the Facility A Commitment or
any Lender's Facility A Commitment. Term Facility B shall not revolve and any
amount repaid or prepaid, as the case may be, under Term Facility B cannot be
reborrowed and shall reduce the Term Credit Commitment by the amount repaid or
prepaid, as the case may be.

                  (3) A conversion from one Type of Accommodation to another
Type of Accommodation shall not constitute a repayment or prepayment.

                  SECTION 2.03. USE OF PROCEEDS. (1) The Borrower may use the
proceeds of any Accommodations under Facility A (i) for general corporate
purposes, (ii) in respect of an amount of not more than $5,000,000, to provide
for the Defeasance of the Existing Credit Agreement and the Existing Notes and
(iii) to make Additional Distributions, provided that no Accommodation for such
purpose shall be permitted unless the remaining (unused) Facility A Commitment
available under Facility A after making any such Additional Distribution would
be at least $25,000,000.

                  (2) The Borrower may use the proceeds of any Accommodations
under Term Facility B, together with other funds available to it, (i) to
refinance the outstanding principal amount of existing bank Debt of the Borrower
in an aggregate amount of approximately Cdn.$301,000,000; (ii) to repay the
Existing Notes (including interest and prepayment premiums) of approximately
US$165,000,000; and (iii) to make a Permitted Distribution in an amount of
approximately Cdn.$260,000,000 to Quebecor Media Inc., directly or indirectly.

                  (3) No proceeds of any Advance will be used to purchase or
carry any equity security of a class which is registered pursuant to Section 12
of the U.S. SECURITIES EXCHANGE ACT of 1934, as amended, or any "margin stock",
as defined in Federal Reserve System Board of Governors Regulation U, or for a
purpose which violates, or would be inconsistent with, Federal Reserve System
Board of Governors Regulation T, U or X. Terms used in this Section for which
meanings are provided in Federal Reserve System Board of Governors Regulation T,
U or X or any regulations substituted therefor, as from time to time in effect,
have the meaning so provided.



                                      32


                  SECTION 2.04. MANDATORY  REPAYMENTS  AND  REDUCTIONS OF
COMMITMENTS.  (1) Subject to Section 9.01,  the Borrower shall repay the
Accommodations Outstanding under Facility A on the last day of the Term.

                  (2) Subject to Section 9.01, the Borrower shall repay the
Accommodations Outstanding under Term Facility B in quarterly installments equal
to .25% of the full amount of Term Facility B, being US$230,000,000, each such
installment being payable on the last Business Day of each of the months of
April, July, October and January of each year until January 31, 2009, and shall
repay the balance of the Accommodations Outstanding under Term Facility B on the
last day of the Term of Term Facility B.

                  SECTION 2.05. MANDATORY  PREPAYMENTS.  (1) Subject to
subsection  (5) hereof,  the  Borrower  agrees to make the following
mandatory prepayments ("MANDATORY PREPAYMENTS").

                  (2) Subject to the next following sentence, an amount equal to
the Net Proceeds from any Disposition of any Assets in excess of $10,000,000 by
the Borrower or any of the Guarantors (other than any Disposition of Assets
permitted pursuant to clauses (i), (ii), (iii) and (iv) of Section 8.02(d))
shall be applied within 365 days of receipt to the PRO RATA prepayment of
Accommodations Outstanding under (i) firstly, Term Facility B; and (ii)
secondly, Facility A (provided that the Facility A Commitment shall not be
reduced as a result of such payment), in each case, in accordance with Section
2.09 hereof, except to the extent that the Net Proceeds from such Disposition of
Assets are reinvested (other than in cash or Cash Equivalents) in the Business
within 360 days of the date of receipt of such Net Proceeds.

                  (3) Subject as provided in the next following sentence, an
amount equal to 75% of the Net Proceeds of any Subordinated Debt (other than,
for greater certainty, Subordinated Debt, the Net Proceeds of which are used to
repay or prepay the Senior Notes or other Subordinated Debt within two Business
Days of the date of receipt of such Net Proceeds) by the Borrower or the
Guarantors shall be applied to the prepayment of the Accommodations Outstanding
under Term Facility B, in accordance with Section 2.09 hereof. The percentage of
Net Proceeds payable pursuant to this Section 2.05(3) shall be reduced to 50%
for any Subordinated Debt if, as of the last day of the most recently completed
Financial Quarter, the Leverage Ratio is less than 2.5:1, and would not exceed
2.5:1 as a result of the incurrence of such new Subordinated Debt (as evidenced
by a Compliance Certificate delivered to the Administrative Agent and the
Lenders).

                  (4) Subject as provided in the next following sentence, an
amount equal to 75% of the Net Proceeds from the issuance of any securities
(other than the Back-to-Back Securities, the Existing Back-to-Back Securities
and Debt securities, but including Debt securities of the nature described in
clause (viii) of the definition of "Debt") by the Borrower or the Guarantors
(other than the issuance of equity among or of any capital contribution by any
Person in the Borrower or by any Guarantor in another Loan Party) shall be
applied to the prepayment of the Accommodations Outstanding under Term Facility
B, in accordance with Section 2.09 hereof. The percentage of Net Proceeds
payable pursuant to this Section 2.05(4)



                                      33

shall be reduced to 50% for any issuance of securities if, as of the last day
of the most recently completed Financial Quarter, the Leverage Ratio is less
than 2.5:1 (as evidenced by a Compliance Certificate delivered to the
Administrative Agent and the Lenders).

                  (5) The Borrower shall advise the Administrative Agent of its
intention to make any such Mandatory Prepayment by notice in writing
substantially in the form of Schedule 2, at least 10 and not more than 20
Business Days before the Mandatory Prepayment is due, and shall pay the amount
of such Mandatory Prepayment to the Administrative Agent when it is due. In
addition, the Borrower shall, at the same time, make a written offer (an
"OFFER") to the Term Lenders, by sending such Offer, substantially in the form
of Schedule 3, to the Administrative Agent for distribution to the Term Lenders,
setting out the entitlement of each such Lender to such Mandatory Prepayment
(other than any Unacceptable Payment, as defined below). Each Term Lender shall
irrevocably respond to the Offer, with a copy to the Administrative Agent, at
least 3 Business Days' before the Mandatory Prepayment is due. Failure on the
part of any Term Lender to so respond shall be deemed an acceptance of the Offer
by such Term Lender. All proceeds of each Mandatory Prepayment shall be applied
rateably amongst the Term Lenders to repay and permanently reduce Term Facility
B in inverse order of maturity. However, the Borrower shall not be obliged to
make an Offer and the Term Lenders shall not accept any Mandatory Repayment if,
as a result thereof, the Term Lenders would receive, within 5 years and 10 days
from the date of the first Advance under Term Facility B, an amount that, when
added to the scheduled repayments contemplated by Section 2.04 and to all other
Mandatory Prepayments made prior to that date, would be equal to or would exceed
25% of the amount of the initial Advance under Term Facility B (an "UNACCEPTABLE
PAYMENT"). If any Term Lender decides not to accept any such Mandatory
Repayment, the amount of such Mandatory Repayment that would have been paid to
such Term Lender shall be paid to the Facility A Lenders to reduce the
Accommodations Outstanding, but not the Commitments, under Facility A; provided
that if there are no Accommodations Outstanding under Facility A at such time,
such amount may be retained by the Borrower.

No such Mandatory Prepayment may be made on a date that would require a Libor
Advance to be prepaid, except in accordance with the provisions of Section
12.06(4), provided that the Borrower may cash collateralize such Libor Advances
(and Bankers' Acceptances) in accordance with the provisions of Section 2.10.

                  SECTION 2.06. OPTIONAL PREPAYMENTS AND REDUCTIONS OF
COMMITMENTS. (1) The Borrower may, subject to the provisions of this Agreement,
(i) prepay without penalty or bonus Accommodations Outstanding under any Credit
Facility; or (ii) reduce the Lenders' Facility A Commitment, and, if required as
a result of such reduction, the Accommodations Outstanding under Facility A, in
each case in whole or in part, subject to providing seven (7) Business Days'
notice to the Administrative Agent stating the proposed date and aggregate
principal amount of the prepayment or reduction. Each partial prepayment or
reduction shall be in a minimum aggregate principal amount of US$5,000,000 in
respect of Term Facility B and $1,000,000 in respect of Facility A and in an
integral multiple of $1,000,000 or US$1,000,000, as the case may be.



                                      34


                  (2) The Borrower may not in any event prepay the amount of any
Drawing on any date other than the maturity date for the relevant Drawing,
provided that the Borrower may cash collateralize such Drawings in accordance
with the provisions of Section 2.10.

                  SECTION 2.07. FEES. (1) The Borrower shall pay to the
Administrative Agent, for the account of the Facility A Lenders, a fee
calculated at a rate per annum equal to the Applicable Commitment Fee calculated
on the unused and uncancelled portion of Facility A (determined without regard
to any Swingline Advance) calculated daily and payable in arrears on the last
day of each calendar quarter and on the last day of the Term of Facility A.

                  (2) The Borrower shall pay to Banc of America Securities LLC a
fee determined in accordance with the Commitment Letter accepted by the Borrower
dated January 13, 2003, payable in accordance with its terms.

                  SECTION 2.08. PAYMENTS UNDER THIS AGREEMENT. (1) Unless
otherwise expressly provided in this Agreement, the Borrower shall make any
payment required to be made by it to the Administrative Agent or any Lender by
depositing the amount of the payment to the appropriate Agency Branch Account
not later than 10:00 a.m. (Toronto time) on the date the payment is due. The
Administrative Agent shall distribute to each Lender, promptly on the date of
receipt by the Administrative Agent of any payment, an amount equal to the
amount then due to each Lender. Any amount received by the Administrative Agent
for the account of the Lenders shall be held as mandatary for the Lenders until
distributed.

                  (2) Unless otherwise expressly provided in this Agreement, the
Administrative Agent shall make Accommodations and other payments to the
Borrower under this Agreement by transferring the amount of the payment in the
relevant currency to the Borrower's account as may be instructed by the Borrower
in writing on the date the payment is to be made.

                  (3) The Borrower hereby authorizes each Lender, if and to the
extent payment owed to such Lender by the Borrower is not made to the
Administrative Agent when due, to charge from time to time any amount due
against any or all accounts of the Borrower with such Lender.

                  (4) All payments by the Borrower under Facility A shall be in
Canadian Dollars. All payments by the Borrower under the Term Facility shall be
in US Dollars.

                  SECTION 2.09. APPLICATION OF PAYMENTS AND PREPAYMENTS. (1)
Subject to paragraph (2) hereof, each prepayment pursuant to Section 2.05 and
Section 2.06 in respect of Term Facility B shall be applied to the instalments
pursuant to Section 2.04 in the inverse order of their maturity, subject to
paying the applicable breakage costs (as contemplated by Section 12.06) if any
Libor Advance is prepaid.

                  (2) All amounts received by the Administrative Agent from or
on behalf of the Borrower and not previously applied pursuant to this Agreement
shall be applied by the



                                      35

Administrative Agent as follows (i) first, in reduction of the Borrower's
obligation to pay any amounts owing to the Administrative Agent; (ii) second,
in reduction of the Borrower's obligation to pay any unpaid interest and any
Fees which are due and owing; (iii) third, in reduction of the Borrower's
obligation to pay any Claims or Losses referred to in Sections 12.06; (iv)
fourth, in reduction of the Borrower's obligation to pay any amounts due and
owing on account of any unpaid principal amount of Accommodations Outstanding
or amounts under Hedging Agreements which are due and owing; (v) fifth, in
reduction of the Borrower's obligation to pay any other unpaid amounts which
are due and owing to the Lenders; (vi) sixth, in reduction of any other
obligation of the Borrower under this Agreement and the other Credit
Documents; and (vii) seventh, to the Borrower or such other Persons as may
lawfully be entitled to or directed to receive the remainder.

                  SECTION 2.10 CASH COLLATERALIZATION OF CERTAIN PAYMENTS AND
PREPAYMENTS. If a payment or Mandatory Prepayment to be made would require the
repayment of outstanding Bankers' Acceptances, Letters of Credit or Libor
Advances prior to their maturity, the Borrower shall provide to the
Administrative Agent cash collateral in an amount equal to the Face Amount of
such Bankers' Acceptances or Letters of Credit or the principal amount of such
Libor Advances, as the case may be, which cash collateral shall be held by the
Administrative Agent in an interest bearing account, or invested, in accordance
with the instructions of the Borrower (provided no Default has occurred and is
continuing and no Event of Default has occurred), in Cash Equivalents (in either
case, with interest for the benefit of the Borrower), and used to repay same at
maturity. However, in the case where the payment or Mandatory Prepayment would
require the actual prepayment of a Libor Advance, the Borrower may elect to
prepay same and pay to the Administrative Agent for the Lenders the amount of
the losses, costs and expenses suffered or incurred by the Lenders with respect
thereto which are referred to in Section 12.06(4).

                  SECTION 2.11. COMPUTATIONS OF INTEREST AND FEES. (1) All
computations of interest shall be made by the Administrative Agent taking into
account the actual number of days occurring in the period for which such
interest is payable, and a year of 365/366 days, or, in the case of a Libor
Advance, 360 days.

                  (2) All computations of Fees shall be made by the
Administrative Agent on the basis of a year of 365 or 366 days, as the case may
be, taking into account the actual number of days (including the first day but
excluding the last day) occurring in the period for which such fees are payable.

                  (3) For purposes of the INTEREST ACT (Canada), (i) whenever
any interest or Fee under this Agreement is calculated using a rate based on a
number of days less than a full year, such rate determined pursuant to such
calculation, when expressed as an annual rate, is equivalent to (x) the
applicable rate, (y) multiplied by the actual number of days in the calendar
year in which the period for which such interest or fee is payable (or
compounded) ends, and (z) divided by the number of days comprising such
calculation basis; (ii) the principle of deemed reinvestment of interest does
not apply to any interest calculation under this Agreement; and (iii) the rates
of interest stipulated in this Agreement are intended to be nominal rates and
not effective rates or yields.



                                      36


                  (4) No provision of this Agreement shall have the effect of
requiring any Borrower to pay interest (as such term is defined in section 347
of the CRIMINAL CODE OF CANADA) at a rate in excess of 60% per annum, taking
into account all other amounts which must be taken into account for the purpose
thereof and, to such extent, the Borrower's obligation to pay interest hereunder
shall be so limited.


                                  ARTICLE 3
                                   ADVANCES

                  SECTION 3.01. THE ADVANCES. (1) Each Facility A Lender
individually, and not jointly and severally (or solidarily) agrees, on the terms
and conditions of this Agreement, and from time to time prior to the date which
is one Business Day prior to the last Business Day of the Term of Facility A, to
make Prime Rate Advances to the Borrower on any Business Day. The Swingline
Lender agrees, on the terms and conditions of this Agreement, and from time to
time prior to the date which is one Business Day prior to the last Business Day
of the Term of Facility A and subject to the right of the Swingline Lender to
cease acting as such upon thirty (30) days notice to the Administrative Agent
and the Borrower (except where a Default has occurred and is continuing, in
which case no prior notice shall be required), to make Prime Rate Advances to
the Borrower on any Business Day, and immediately thereupon, each Facility A
Lender shall be deemed to, and irrevocably and unconditionally agrees to,
purchase from the Swingline Lender a risk participation in such Swingline
Advance in an amount equal to its rateable share of same. The Borrower shall
repay all outstanding Swingline Advances of the Swingline Lender not less
frequently than by the 15th of each month and the second-to-last Business Day of
each month, failing which a Mandatory Borrowing (as defined and contemplated in
paragraph (2) below) shall occur. If the Swingline Lender elects to resign as
such, the Borrower shall be obliged to find a replacement Swingline Lender,
failing which the Swingline Commitment will expire (but, for greater certainty,
without reducing the Facility A Commitment) and no Swingline Advances will be
available. Each Advance (other than Swingline Advances) shall be made rateably
by the applicable Lenders.

                  (2) Upon receipt by the Swingline Lender of a notice from the
Administrative Agent that one or more of the applicable conditions specified in
Section 6.02 are not then satisfied, no further Advances shall be made or
issued, as the case may be, by the Swingline Lender. Upon receipt of a notice
from the Administrative Agent that a Default has occurred and is continuing, the
Swingline Lender may, in its sole discretion, give notice to the Administrative
Agent who shall forthwith notify the Facility A Lenders that the principal
amount of its outstanding Swingline Advances shall be funded with an Advance
under Facility A (provided that even absent such notice of a Default, such
notice shall be deemed to have been given (a) at 10:00 a.m. Toronto time on the
15th of each month and the second-to-last Business Day of each month if the
Borrower shall not have repaid all Swingline Advances on or prior to such days,
(b) on the last day of the Term of Facility A if the Borrower shall not have
repaid all Swingline



                                      37

Advances on or prior to such day, and (c) upon the occurrence of a demand
pursuant to Section 9.01 or an Event of Default, in which case Advances under
Facility A (each such Advance, a "MANDATORY BORROWING") shall be made on the
next Business Day by all Facility A Lenders, so that immediately after the
Mandatory Borrowing, each such Facility A Lender shall share rateably in the
Accommodations Outstanding under Facility A and the proceeds shall be applied
directly by the Administrative Agent to repay Advances outstanding to the
Swingline Lender. Each applicable Facility A Lender shall make Advances
pursuant to a Mandatory Borrowing in the amount and in the manner specified
in writing by the Administrative Agent notwithstanding (i) that the amount of
the Mandatory Borrowing may not comply with the minimum amount for Advances
otherwise required under this Agreement; (ii) that the conditions specified
in Article 6 are not satisfied; (iii) that a Default has occurred and is
continuing or an Event of Default has occurred; (iv) the date of such
Mandatory Borrowing; and (v) any reduction in the Facility A Commitment after
any Advance was made by the Swingline Lender.

                  (3) Each Term Lender individually, and not jointly and
severally (or solidarily) agrees, on the terms and conditions of this Agreement,
to make Libor Advances and US Prime Rate Advances to the Borrower on any
Business Day. Each Advance shall be made rateably by the applicable Lenders. All
Advances under Term Facility B shall be in US Dollars alone. The initial Advance
under Term Facility B shall be for the full amount available thereunder and
shall be made on the Closing Date. Any portion of the Advances available to the
Borrower under Term Facility B that is not borrowed as part of such initial
Advance or that is repaid shall not again be available for borrowing, although
Libor Advances may be rolled over into new Libor Advances or converted into US
Prime Rate Advances, and US Prime Rate Advances may be converted into Libor
Advances.

                  SECTION 3.02. PROCEDURE FOR ADVANCES. Except as provided in
Section 3.02(2), each Advance shall be in a minimum amount of $1,000,000 for
Prime Rate Advances and US Prime Rate Advances, and $5,000,000 for Libor
Advances, and in an integral multiple of $1,000,000 in each case, and shall be
subject to the Borrower providing the appropriate number of days' prior notice
specified in this Agreement (being one Business Day's notice for Prime Rate
Advances and US Prime Rate Advances and three Banking Days' notice for Libor
Advances), given not later than 10:00 a.m. (Toronto time) by the Borrower to the
Administrative Agent. Each notice of an Advance (a "BORROWING NOTICE") shall be
in substantially the form of Schedule 1, shall be irrevocable and binding on the
Borrower and shall specify (i) the requested date of the Advance; (ii) the
aggregate amount of the Advance; and (iii) the Credit Facility under which such
Advance is requested. Upon receipt by the Administrative Agent of funds from the
Lenders and fulfilment of the applicable conditions set forth in Article 6, the
Administrative Agent will make such funds available to the Borrower in
accordance with Article 2.

                  (2) Each Swingline Advance may be made on the same day, and in
such amount (provided that each Swingline Advance shall be in a minimum amount
of $500,000, and there shall be no more than 2 Swingline Advances per week), as
requested by the Borrower by giving an irrevocable telephone notice on any
Business Day to the Swingline Lender and to the Administrative Agent, followed
by the immediate delivery of a written Borrowing Notice to the Swingline Lender
(with a copy to the Administrative Agent on the same day).



                                      38


                  SECTION 3.03. LIBOR ADVANCES. If the Advance requested is a
Libor Advance, the Administrative Agent shall determine the LIBOR which will be
in effect on the date of the Advance (which must be a Banking Day), with respect
to the Selected Amount or to each of the Selected Amounts, as the case may be,
having a maturity of 1, 2, 3 or 6 months (subject to availability, or such other
period of 10 to 180 days which may be available and is acceptable to the
Administrative Agent) from the date of the Advance (a "DESIGNATED PERIOD").
However, if the Borrower has not delivered a notice to the Administrative Agent
in a timely manner in accordance with the provisions of Section 3.02, the
Borrower shall be deemed to have requested a US Prime Rate Advance. In addition,
the Borrower may not have more than 15 different Libor Advances outstanding at
any time.

                  SECTION 3.04. MARKET FOR LIBOR ADVANCES. If, at any time or
from time to time, as a result of market conditions, (i) there exists no
appropriate or reasonable method to establish LIBOR, for a Selected Amount or a
Designated Period, or (ii) US Dollar deposits are not available to the Lenders
in such market in the ordinary course of business in amounts sufficient to
permit them to make the Libor Advance, for a Selected Amount or a Designated
Period, such Lenders shall so advise the Administrative Agent and, any such
Lenders shall not be obliged to honour any Borrowing Notice in connection with
any Libor Advances, and the Borrower's option to request Libor Advances shall
thereupon be suspended upon notice by the Administrative Agent to the Borrower.

                  SECTION 3.05. SUSPENSION OF LIBOR ADVANCE OPTION. If a notice
has been given by the Administrative Agent in accordance with Section 3.04,
Libor Advances, or any part thereof, shall not be made (whether as an Advance, a
conversion or an extension) by the Lenders affected by the circumstances
referred to in Section 3.04 and the right of the Borrower to choose that Libor
Advances from such Lenders be made or, once made, be converted or extended into
a Libor Advance shall be suspended until such time as the Administrative Agent
has determined that the circumstances having given rise to such suspension no
longer exist, in respect of which determination the Administrative Agent shall
advise the Borrower within a reasonable delay.

                  SECTION 3.06. LIMITS ON LIBOR ADVANCES. Nothing in this
Agreement shall be interpreted as authorizing the Borrower to borrow by way of
Libor Advances for a Designated Period expiring on a date which results in a
situation where Term Facility B cannot be reduced as required by this Agreement,
or on a date which is after the expiry of the Term.

                  SECTION 3.07. CONVERSIONS OF ADVANCES. The Borrower may elect
to convert an Advance, or any portion thereof, to another type of Accommodation
in the same currency upon the number of days notice specified in Section 3.02 by
sending an Accommodation Notice on any Business Day.

                  SECTION 3.08. INTEREST ON PRIME RATE ADVANCES. Subject to the
next following sentence, the Borrower shall pay interest on the unpaid principal
amount of each Prime Rate Advance from the date of such Advance until the date
on which the principal amount of the Prime Rate Advance is repaid in full at a
rate per annum equal at all times to the Canadian Prime



                                      39

Rate in effect from time to time plus the Applicable Margin, calculated
daily, and payable in arrears (i) on the last day of each month in each year;
and (ii) when such Advance becomes due and payable in full pursuant to the
provisions hereof. Any amount of principal of or interest on any such Advance
which is not paid when due (whether at stated maturity, by acceleration or
otherwise) shall (to the extent permitted by Law) bear interest (both before
and after judgment), from the date on which such amount is due until such
amount is paid in full, payable on demand, at a rate per annum equal to the
sum of (i) the Canadian Prime Rate in effect from time to time; (ii) the
Applicable Margin; and (iii) 2%.

                  SECTION 3.09. INTEREST ON US PRIME RATE ADVANCES. Subject to
the next following sentence, the Borrower shall pay interest on the unpaid
principal amount of each US Prime Rate Advance from the date of such Advance
until the date on which the principal amount of the US Prime Rate Advance is
repaid in full at a rate per annum equal at all times to the US Prime Rate in
effect from time to time plus the Applicable Margin, calculated daily, and
payable in arrears (i) on the last day of each month in each year; and (ii) when
such Advance becomes due and payable in full pursuant to the provisions hereof.
Any amount of principal of or interest on any such Advance which is not paid
when due (whether at stated maturity, by acceleration or otherwise) shall (to
the extent permitted by Law) bear interest (both before and after judgment),
from the date on which such amount is due until such amount is paid in full,
payable on demand, at a rate per annum equal to the sum of (i) the US Prime Rate
in effect from time to time; (ii) the Applicable Margin; and (iii) 2%.

                  SECTION 3.10. INTEREST ON LIBOR ADVANCES. The principal amount
of the Libor Advances which at any time and from time to time remains
outstanding shall bear interest, calculated daily, on the daily balance of such
Libor Advances, from the date of each Libor Advance, at the annual rate
(calculated based on a 360-day year) applicable to each of such days which
corresponds to the LIBOR applicable to each Selected Amount, plus the Applicable
Margin, and shall be effective as and from the date of each Libor Advance up to
and including the last day of the applicable Designated Period. LIBOR shall be
promptly transmitted to the Borrower two Banking Days prior to the date on which
the Libor Advance is to be made. Such interest shall be payable to the
Administrative Agent, in arrears, on the last day of the Designated Period when
the Designated Period is 1 to 3 months, and when the Designated Period exceeds 3
months, on the last Business Day of each period of 3 months during such
Designated Period, and on the last day of the Designated Period. Any amount of
principal of or interest on any such Libor Advance which is not paid when due
(whether at stated maturity, by acceleration or otherwise) shall (to the extent
permitted by Law) bear interest (both before and after judgment), from the date
on which such amount is due until such amount is paid in full, payable on
demand, at a rate per annum equal to the sum of (i) the LIBOR in effect from
time to time; (ii) the Applicable Margin; and (iii) 2%.



                                      40

                                   ARTICLE 4
                            BANKERS' ACCEPTANCES

                  SECTION 4.01 ACCEPTANCES AND DRAFTS. (1) Each Facility A
Lender individually, and not jointly and severally (or solidarily) agrees, on
the terms and conditions of this Agreement and from time to time on any Business
Day prior to the expiry of the Term of Facility A (i) in the case of a Facility
A Lender which is willing and able to accept Drafts, to create acceptances
("BANKERS' ACCEPTANCES") by accepting Drafts and to purchase such Bankers'
Acceptances in accordance with Section 4.03(2), (ii) in the case of a Facility A
Lender which is unable to accept Drafts, to purchase completed Drafts (which
have not and will not be accepted by the Facility A Lender or any other Facility
A Lender) in accordance with Section 4.03(2), (iii) in the case of a Facility A
Lender which has participated or assigned all or any part of its interest in the
Credit Facilities to a Participant which is willing and able to accept Drafts,
to arrange for the creation of Bankers' Acceptances by such Participant and for
their purchase by such Participant, to the extent of the participation or
assignment, in accordance with Section 4.03(2), and (iv) in the case of a
Facility A Lender which has participated or assigned all or any part of its
interest in the Credit Facilities to a Participant which is unwilling or unable
to accept Drafts, to arrange for the purchase by the Participant of completed
Drafts (which have not and will not be accepted by such Facility A Lender or any
other Facility A Lender), to the extent of the participation or assignment, in
accordance with Section 4.03(2).

                  (2) Each Drawing shall be in a minimum amount of $3,000,000
and in an integral multiple of $1,000,000 and shall consist of the creation and
purchase of Bankers' Acceptances or the purchase of Drafts on the same day, in
each case for the Drawing Price, effected or arranged by the Facility A Lenders
in accordance with Section 4.03 and their respective Facility A Lender's
Commitment.

                  (3) If the Administrative Agent determines that the Bankers'
Acceptances to be created and purchased or Drafts to be purchased on any Drawing
(upon a conversion or otherwise) will not be created and purchased rateably by
the Facility A Lenders (or any of their respective Participants) in accordance
with Sections 4.01(2) and 4.03, then the requested Face Amount of Bankers'
Acceptances and Drafts shall be reduced to such lesser amount as the
Administrative Agent determines will permit rateable sharing and the amount by
which the requested Face Amount shall have been so reduced shall be converted or
continued, as the case may be, as a Prime Rate Advance under Facility A, to be
made contemporaneously with the Drawing.

                  (4) The Administrative Agent is authorized by the Borrower and
each Lender to allocate amongst the Facility A Lenders the Bankers' Acceptances
to be issued and purchased in such manner and amounts as the Administrative
Agent may, in its sole discretion, but acting reasonably, consider necessary, so
as to ensure that no Lender is required to accept and purchase a Bankers'
Acceptance for a fraction of $100,000, and in such event, the Lenders'
respective Facility A Commitments in any such Bankers' Acceptances and
repayments thereof shall be altered accordingly. Further, the Administrative
Agent is authorized by the Borrower and each Facility A Lender to cause the
proportionate share of one or more Lender's Accommodations



                                      41

(calculated based on its Commitment) to be exceeded by no more than $100,000
each as a result of such allocations provided that the principal amount of
outstanding Accommodations, including Bankers' Acceptances, shall not thereby
exceed the maximum amount of the respective Commitment of each Facility A
Lender.

                  SECTION 4.02. FORM OF DRAFTS. Each Draft presented by the
Borrower shall (i) be in a minimum amount of $100,000 and in an integral
multiple of $100,000; (ii) be dated the date of the Drawing, and (iii) mature
and be payable by the Borrower (in common with all other Drafts presented in
connection with such Drawing) on a Business Day which occurs (subject to
availability) approximately 1, 2, 3, or 6 months after the Drawing Date (or such
other period of 10 to 180 days as may be available and acceptable to the
Administrative Agent), at the election of the Borrower, and on or prior to the
last day of the Term of Facility A.

                  SECTION 4.03. PROCEDURE FOR DRAWING. (1) Each Drawing shall be
made on notice (a "DRAWING NOTICE") given by the Borrower to the Administrative
Agent not later than 10:00 a.m. (Toronto time) not less than two Business Days
prior to the date on which the Drawing is to occur. Each Drawing Notice shall be
in substantially the form of Schedule 1, shall be irrevocable and binding on the
Borrower and shall specify (i) the Drawing Date; (ii) the fact that the Drawing
is to be made under Facility A; (iii) the aggregate Face Amount of Drafts to be
accepted and purchased (or purchased, as the case may be); and (iv) the contract
maturity date for the Drafts.

                  (2) Not later than 1:00 p.m. (Toronto time) on an applicable
Drawing Date, each Facility A Lender shall complete one or more Drafts in
accordance with the Drawing Notice and either (i) accept the Drafts and purchase
the Bankers' Acceptances thereby created for the Drawing Price; or (ii) purchase
such Drafts for the Drawing Price, and, in each case, pay to the Administrative
Agent the Drawing Proceeds in respect of such Bankers' Acceptance or Draft, as
the case may be. Upon receipt of the Drawing Proceeds and upon fulfilment of the
applicable conditions set forth in Article 6, the Administrative Agent shall
make funds available to the Borrower in accordance with Article 2.

                  (3) The Borrower shall, at the request of any Facility A
Lender, issue one or more non-interest bearing promissory notes (each a "BA
EQUIVALENT NOTE") payable on the date of maturity of the unaccepted Draft
referred to below, in such form as the Facility A Lender may specify and in a
principal amount equal to the Face Amount of, and in exchange for, any
unaccepted Drafts which the Facility A Lender has purchased or has arranged to
have purchased in accordance with Section 4.03(2).

                  (4) Bankers' Acceptances purchased by a Facility A Lender or
Participant may be held by it for its own account until the contract maturity
date or sold by it at any time prior to that date in any relevant Canadian
market in such Person's sole discretion.

                  SECTION 4.04. SIGNATURES OF DRAFT FORMS. The Borrower hereby
irrevocably appoints each Facility A Lender as its lawful attorney to sign and
endorse on its behalf, manually or by facsimile or mechanical signature, any BA
Instrument necessary to enable each Facility A Lender to make Drawings in the
manner specified in this Article 4. All Bankers' Acceptances



                                      42

signed or endorsed on the Borrower's behalf and in accordance with its
instructions by a Facility A Lender shall be binding on the Borrower, all as
if duly executed and issued by the Borrower. No Facility A Lender shall be
liable for any Claim or Loss arising by reason of any loss or improper use of
any such BA Instruments, except arising out of the gross negligence or
willful misconduct of such Lender. Each Facility A Lender shall (i) maintain
a record with respect to any BA Instrument completed in accordance herewith,
voided by it for any reason, accepted and purchased by it hereunder, and
canceled at their respective maturities; and (ii) retain such records in the
manner and for the statutory periods provided in the various provincial or
federal statutes and regulations which apply to such Facility A Lender. On
request by the Borrower, a Facility A Lender shall cancel all BA Instruments
which have been pre-signed or pre-endorsed on behalf of such Borrower and
which are held by such Facility A Lender and are not required to make
Drawings in accordance with this Article 4.

                  SECTION 4.05. PAYMENT, CONVERSION OR RENEWAL OF BA
INSTRUMENTS. (1) Upon the maturity of a BA Instrument, the Borrower may (i)
elect to issue a replacement BA Instrument by giving a Drawing Notice in
accordance with Section 4.03(1); (ii) elect to have all or a portion of the Face
Amount of the BA Instrument converted to an Advance by giving a Accommodation
Notice in accordance with Section 3.02; or (iii) pay, on or before 10:00 a.m.
(Toronto time) on the maturity date for the BA Instrument, an amount in Canadian
Dollars equal to the Face Amount of the BA Instrument (notwithstanding that a
Facility A Lender may be the holder of it at maturity). Any such payment shall
satisfy the Borrower's obligations under the BA Instrument to which it relates
and the relevant Facility A Lender or Participant shall then be solely
responsible for the payment of the BA Instrument.

                  (2) If the Borrower fails to pay any BA Instrument when due or
issue a replacement in the Face Amount of such BA Instrument pursuant to Section
4.05(1), the unpaid amount due and payable shall be converted to a Prime Rate
Advance made by the Facility A Lenders rateably under the applicable Credit
Facility and shall bear interest calculated and payable as provided in Article
3. This conversion shall occur as of the due date and without any necessity for
the Borrower to give a Borrowing Notice.

                  SECTION 4.06. CIRCUMSTANCES MAKING BANKERS' ACCEPTANCES
UNAVAILABLE. (1) If, by reason of circumstances affecting the money market
generally, there is no market for Bankers' Acceptances, (i) the right of the
Borrower to request a Drawing shall be suspended until the circumstances causing
a suspension no longer exist; and (ii) any Drawing Notice which is outstanding
shall be deemed to be an Accommodation Notice requesting an Advance comprised of
Prime Rate Advances.

                  (2) The Administrative Agent shall promptly notify the
Borrower of the suspension of the Borrower's right to request a Drawing and of
the termination of any suspension.

                  SECTION 4.07. DEPOSITORY BILLS AND NOTES ACT. Bankers'
Acceptances may be issued in the form of a depository bill and deposited with a
clearing house, both terms as defined in the DEPOSITORY BILLS AND NOTES ACT. The
Administrative Agent and the Borrower shall agree on the procedures to be
followed, acting reasonably. The Facility A Lenders are also authorized



                                      43

to issue depository bills as replacements for previously issued Bankers'
Acceptances, on the same terms as those replaced, and deposit them with a
clearing house against cancellation of the previously issued Bankers'
Acceptances.


                                   ARTICLE 5

                               LETTERS OF CREDIT


                  SECTION 5.01. LETTERS OF CREDIT. (1) The Issuing Lender
agrees, in reliance upon the terms and subject to the conditions of this
Agreement (and in accordance with the standard terms and conditions represented
by any agreement (including the Issuing Lender's standard Letter of Credit
Application Form, as defined below) that may be entered into between the
Borrower and the Issuing Lender from time to time, including the payment of
administrative fees and costs), to issue Letters of Credit for the account of
the Borrower from time to time on any Business Day prior to the eighth-to-last
day of the Term of Facility A, which Letter of Credit shall expire on the
earlier of (a) one year from issuance, or (b) 7 days prior to the expiry of the
Term of Facility A. The issuance of any such Letter of Credit shall require two
(2) Business Days' prior notice to the Administrative Agent and the Issuing
Lender, which notice shall be accompanied by the Issuing Lender's standard
Letter of Credit application form, duly completed and executed by the Borrower.
The Borrower shall pay, in respect of any such Letter of Credit, fees equal to
the aggregate of: (i) for the Facility A Lenders, the Applicable Margin
multiplied by the Face Amount thereof (and taking into account the number of
days until the expiry date thereof), and (ii) for the Issuing Lender, 1/8% per
annum of the Face Amount thereof (taking into account the number of days until
the expiry date thereof), payable in advance on the date of issuance, or on such
other date as the Administrative Agent and the Issuing Lender may determine from
time to time.

                  (2) For greater certainty, the Issuing Lender shall not be
obliged to issue any Letter of Credit if as a result (a) the Accommodations
Outstanding under Facility A would exceed the Facility A Commitments, (b) the
Issuing Lender's or any other Lender's Facility A Commitment would be exceeded,
(c) the amount of Accommodations Outstanding by way of Letters of Credit would
exceed Cdn. $2,000,000, (d) a Law or an order, judgment or decree of a
Governmental Entity would be breached or would prohibit such issuance, (e) the
Issuing Lender or other Facility A Lenders would incur increased costs of the
nature referred to in Section 12.06 in respect of which they would not be
indemnified by the Borrower, (f) the policies of the Issuing Lender would be
breached.

                  (3) The Issuing Lender's Letter of Credit Application Form and
any form pertaining to amendments of any Letter of Credit (collectively, the
"LETTER OF CREDIT APPLICATION FORM") shall require, INTER ALIA, (A) the proposed
issuance date of the requested Letter of Credit (which shall be a Business Day);
(B) the amount thereof; (C) the expiry date thereof; (D) the name and address of
the beneficiary thereof; (E) the documents to be presented by such beneficiary
in case of any drawing thereunder; (F) the full text of any certificate to be



                                      44


presented by such beneficiary in case of any drawing thereunder; and (G) such
other matters as the Issuing Lender may require.

                  (4) Promptly after receipt of any Letter of Credit
Application, the Issuing Lender will confirm with the Administrative Agent (by
telephone or in writing) that the Administrative Agent has received a copy of
such Letter of Credit Application from the Borrower and, if not, the Issuing
Lender will provide the Administrative Agent with a copy thereof. Upon receipt
by the Issuing Lender of confirmation from the Administrative Agent that the
requested issuance or amendment is permitted in accordance with the terms
hereof, then, subject to the terms and conditions hereof, the Issuing Lender
shall, on the requested date, issue a Letter of Credit for the account of the
Borrower in accordance with the Issuing Lender's usual and customary business
practices, and immediately thereupon, each Lender shall be deemed to, and
irrevocably and unconditionally agrees to, purchase from the Issuing Lender a
risk participation in such Letter of Credit in an amount equal to its rateable
share of same.

                  SECTION 5.02. REIMBURSEMENTS OF AMOUNTS DRAWN. (1) At or
before 10:00 a.m. (Toronto time) on the earlier of (i) the date specified by a
beneficiary thereof (a "BENEFICIARY") as a drawing date under a Letter of
Credit; and (ii) the last day of the Term of Facility A, the Borrower shall pay
to the Issuing Lender an amount in same day funds equal to the amount to be
drawn by the Beneficiary in Canadian Dollars.

                  (2) If the Borrower fails to pay to the Issuing Lender an
amount, in same day funds, equal to the amount of such drawing, then (i) the
Borrower shall be deemed to have given a Borrowing Notice to the Administrative
Agent, requesting a Prime Rate Advance under Facility A in an amount equal to
the amount of such drawing; (ii) the Facility A Lenders shall, on the date of
such drawing, make such Prime Rate Advance, rateably under Facility A; and (iii)
the Administrative Agent shall pay the proceeds thereof to the Issuing Lender as
reimbursement for the amount of such drawing.

                  (3) Each Facility A Lender shall be required to make the Prime
Rate Advances referred to in Section 5.02(2) notwithstanding (i) the amount of
the Prime Rate Advance in question may not comply with the minimum amount
required for Advances hereunder; (ii) whether any conditions specified in
Article 6 are then satisfied; (iii) whether a Default has occurred and is
continuing or whether an Event of Default has occurred; (iv) the date of such
Prime Rate Advance; (v) any reduction in the Facility A Commitment; (vi) any
set-off, counterclaim, recoupment, defense or other right which such Lender may
have against the Issuing Lender, the Borrower or any other Person for any reason
whatsoever; (vii) whether the Facility A Commitment has been, or, after the
making of such Prime Rate Advance, will be, exceeded; and (viii) any other
occurrence, event or condition, whether or not similar to any of the foregoing.

                  SECTION 5.03. RISK OF LETTERS OF CREDIT. (1) In determining
whether to pay under a Letter of Credit, the Issuing Lender shall be responsible
only to determine that the documents and certificates required to be delivered
under the Letter of Credit have been delivered and that they comply on their
face with the requirements of the Letter of Credit.



                                      45


                  (2) The reimbursement obligation of the Borrower under any
Letter of Credit shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including (i) any lack of validity or enforceability of a Letter of Credit or
any Credit Document; (ii) the existence of any claim, set-off, defence or other
right which the Borrower may have at any time against a Beneficiary, the Issuing
Lender or any other Person, whether in connection with the Credit Documents and
the transactions contemplated therein or any other transaction (including any
underlying transaction between such Borrower and the Beneficiary); (iii) any
certificate or other document presented with a Letter of Credit proving to be
forged, fraudulent or invalid or any statement in it being untrue or inaccurate,
or any loss or delay in the transmission or otherwise of any document required
in order to make a drawing under such Letter of Credit; (iv) the existence of
any act or omission or any misuse of, a Letter of Credit or misapplication of
proceeds by the Beneficiary, including any fraud in any certificate or other
document presented with a Letter of Credit in each case unless, before payment
of a Letter of Credit, (a) the Borrower has delivered to the Issuing Lender a
written notice of the fraud together with a written request that it refuse to
honour such drawing, (b) the fraud by the Beneficiary has been established to
the knowledge of the Issuing Lender so as to make the fraud clear or obvious to
the Issuing Lender, and (c) in the case of fraud in the underlying transaction
between the Borrower and the Beneficiary, the fraud is of such character as to
make the demand for payment by the Beneficiary under the Letter of Credit a
fraudulent one; (v) payment by the Issuing Lender under the Letter of Credit
against presentation of a certificate or other document which does not comply
with the terms of the Letter of Credit unless such payment constitutes gross
negligence or wilful misconduct of the Issuing Lender; (vi) any payment made by
the Issuing Lender under such Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to any
beneficiary or any transferee of such Letter of Credit, including any arising in
connection with any proceeding under any Law dealing with bankruptcy, insolvency
or arrangements with creditors; (vii) any other circumstance or happening
whatsoever, whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Borrower; or (viii) the existence of a Default or Event of
Default.

                  (3) The Borrower shall promptly examine a copy of each Letter
of Credit and each amendment thereto that is delivered to it and, in the event
of any claim of noncompliance with the Borrower's instructions or other
irregularity, the Borrower will immediately notify the Issuing Lender. The
Borrower shall be conclusively deemed to have waived any such claim against the
Issuing Lender and its correspondents unless such notice is given as aforesaid.

                  (4) The Issuing Lender shall not be responsible for (i) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
under it or proceeds of it, in whole or in part, which may prove to be invalid
or ineffective for any reason; (ii) errors, omissions, interruptions or delays
in transmission or delivery of any messages by mail, telecopy or otherwise;
(iii) errors in interpretation of technical terms; (iv) any loss or delay in the
transmission of any document required in order to make a drawing; and (v) any
consequences arising from causes beyond the control of the Issuing Lender,
including the acts or omissions, whether rightful or wrongful, of any
Governmental Entity. None of the above shall affect, impair, or prevent the
vesting of any of



                                      46

the Issuing Lenders' rights or powers under this Agreement. Each Lender and
the Borrower agree that, in paying any drawing under a Letter of Credit, the
Issuing Lender shall not have any responsibility to obtain any document
(other than any sight draft, certificates and documents expressly required by
the Letter of Credit) or to ascertain or inquire as to the validity or
accuracy of any such document or the authority of the Person executing or
delivering any such document. None of the Issuing Lender, any Agent-Related
Person nor any of the respective correspondents, participants or assignees of
the Issuing Lender shall be liable to any Lender for (i) any action taken or
omitted in connection herewith at the request or with the approval of the
Lenders or the Majority Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii)
the due execution, effectiveness, validity or enforceability of any document
or instrument related to any Letter of Credit or Letter of Credit
Application. The Borrower hereby assumes all risks of the acts or omissions
of any beneficiary or transferee with respect to its use of any Letter of
Credit; PROVIDED, HOWEVER, that this assumption is not intended to, and shall
not, preclude the Borrower's pursuing such rights and remedies as it may have
against the beneficiary or transferee at law or under any other agreement.
None of the Issuing Lender, any Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the Issuing Lender,
shall be liable or responsible for any of the matters described in SECTION
5.03(2); PROVIDED, HOWEVER, that anything in such clauses to the contrary
notwithstanding, the Borrower may have a claim against the Issuing Lender,
and the Issuing Lender may be liable to the Borrower, to the extent, but only
to the extent, of any direct, as opposed to consequential or exemplary,
damages suffered by the Borrower which the Borrower proves were caused by the
Issuing Lender's willful misconduct or gross negligence or the Issuing
Lender's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit. In
furtherance and not in limitation of the foregoing, the Issuing Lender may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the Issuing Lender shall not be responsible
for the validity or sufficiency of any instrument transferring or assigning
or purporting to transfer or assign a Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.

                  SECTION 5.04. REPAYMENTS. (1) If the Borrower is required to
repay the Accommodations Outstanding pursuant to Article 9, then the Borrower
shall pay to the Administrative Agent an amount equal to the Issuing Lender's
contingent liability in respect of (i) any outstanding Letter of Credit; and
(ii) any Letter of Credit which is the subject matter of any order, judgment,
injunction or other such determination (a "JUDICIAL ORDER") restricting payment
under and in accordance with such Letter of Credit or extending the Issuing
Lender's liability under such Letter of Credit beyond its stated expiration
date.

                  (2) The Issuing Lender shall, with respect to any Letter of
Credit, upon the later of:

         (a) the date on which any final and non-appealable order, judgment or
other such determination has been rendered or issued either terminating the
applicable Judicial Order or permanently enjoining the Issuing Lender from
paying under such Letter of Credit; and



                                      47

         (b) the earlier of (i) the date on which either (x) the original
counterpart of the Letter of Credit is returned to the Issuing Lender for
cancellation, or (y) the Issuing Lender is released by the Beneficiary from any
further obligations, and (ii) the expiry (to the extent permitted by any
applicable Law) of the Letter of Credit,

pay to the Borrower an amount equal to the amount by which the amount paid to
the Administrative Agent pursuant to Section 5.04(1) exceeds the amounts paid by
the Issuing Lender under the Letter of Credit.

                  SECTION 5.05. APPLICABILITY OF ISP98 AND UCP. Unless otherwise
expressly agreed by the Issuing Lender and the Borrower when a Letter of Credit
is issued, (i) the rules of the "International Standby Practices 1998" published
by the Institute of International Banking Law & Practice (or such later version
thereof as may be in effect at the time of issuance) shall apply to each standby
Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International Chamber of
Commerce (the "ICC") at the time of issuance (including the ICC decision
published by the Commission on Banking Technique and Practice on April 6, 1998
regarding the European single currency (euro)) shall apply to each commercial
Letter of Credit.

                  SECTION 5.06. CONFLICT WITH LETTER OF CREDIT  APPLICATION.
In the event of any conflict between the terms hereof and the terms of any
Letter of Credit Application, the terms hereof shall control.

                                  ARTICLE 6
                            CONDITIONS OF LENDING

                  SECTION 6.01. CONDITIONS PRECEDENT TO THE INITIAL
ACCOMMODATION. The obligation of each Lender to make its initial Accommodation
under the Credit Facilities on or after the date hereof is subject to (i) the
applicable conditions precedent in Section 6.02; and (ii) the condition
precedent that the Administrative Agent and each Lender shall be satisfied with,
or the Borrower or its subsidiaries, shall have delivered to the Administrative
Agent, as the case may be, on or before the day of such initial Accommodation,
the following, in form, substance and dated as of a date satisfactory to the
Lenders and their counsel and in sufficient quantities for each Lender:

         (a) certified copies of all of the constating documents, borrowing
by-laws and resolutions of the boards of directors (or any duly authorized
committee thereof) of the Borrower and the Guarantors approving the borrowing
and other matters contemplated by this Agreement and approving the entering into
of all other Credit Documents to which it is a party and the completion of all
transactions contemplated thereunder shall have been provided to the
Administrative Agent, together with all other instruments evidencing necessary
corporate action of the Borrower and of any required Authorization, with respect
to such matters;



                                      48


         (b) a certificate of the secretary or an assistant secretary of the
Borrower and each of the Guarantors certifying the names and true signatures of
its officers authorized to sign this Agreement and the other Credit Documents;

         (c) a certificate of status, compliance, good standing or like
certificate with respect to the Borrower and each of the Guarantors issued by
the appropriate government officials of the jurisdiction of its incorporation
and of each jurisdiction in which it owns any material assets or carries on any
material business;

         (d) certification as to the financial condition and solvency of, and
the absence of Default and compliance with laws and obligations in all material
respects by, the Borrower and each Guarantor, from the chief financial officer
or a senior financial officer of the relevant Person;

         (e) there shall not exist (i) any order, decree, judgment, ruling or
injunction which restrains the consummation of the financing contemplated hereby
or (ii) any pending or threatened action, suit, investigation or proceeding
which, if adversely determined, would reasonably be expected to materially
adversely affect the ability of the Borrower or any Guarantor to perform any of
its obligations under the Credit Documents or the ability of the Lenders to
exercise their rights thereunder;

         (f) all environmental reports, insurance certificates and such other
reports, audits or certifications as it may reasonably request;

         (g)      the corporate, capital and ownership structure of the
Borrower and its subsidiaries;

         (h) the Borrower shall have provided an irrevocable direction of
payment to the Administrative Agent pursuant to which the Borrower instructs the
Administrative Agent, contemporaneously with the first Accommodation hereunder
and using the proceeds thereof, as well as additional funds to be provided by
the Borrower, to cause the Defeasance of (i) the Existing Credit Agreement and
(ii) the Existing Notes;

         (i) all material Liens on the property of the Borrower and its
subsidiaries, other than Permitted Liens, shall have been discharged or, in the
case of subsection (h)(i) above, shall be subject to a binding undertaking to
release same immediately following the repayment thereof, in form and substance
satisfactory to the Administrative Agent and its counsel, and an undertaking
shall have been provided to obtain acknowledgements from certain creditors
concerning the scope of their security;

         (j) each of this Agreement and each of the Credit Documents other than
the Hedge Agreements entered into as part of the Hedging Requirements, which may
be entered into within 30 days from the Closing Date, including (i) the Security
Documents listed in Schedule 5 and (ii) guarantees from each of the Guarantors
referred to in Schedule 7, all in form and substance satisfactory to the
Administrative Agent and its counsel, shall have been executed, delivered,
issued or assigned and registered or published, as the case may be; provided
that the Security in



                                      49

place on the Closing Date may exclude certain real property listed in
Schedule 6.01(j) of the Loan Parties having a value (based on municipal tax
evaluations) not exceeding $10,000,000, provided that such real property is
made subject to valid and enforceable first-ranking Liens (subject to
Permitted Liens) in favour of the Administrative Agent on behalf of the
Lenders within 60 days from the Closing Date;

         (k) the Administrative Agent shall have received copies of all existing
title and search reports prepared by lawyers or notaries with respect to any
real or immovable property in Canada owned by the Borrower or any of the
Guarantors, as well as updates of such reports, and, within 60 days after the
Closing Date, title reports and updates in respect of all of the Loan Parties'
real properties which were not delivered at the Closing Date, other than those
listed in Schedule 6.01(j), all in form and substance satisfactory to the
Administrative Agent and its counsel; provided that if the Florida Sun is not
sold within 60 days following the Closing Date, such title reports will be
provided concurrently with the granting of the Security on its Assets which is
required to be granted within such delay;

         (l) all of the issued and outstanding shares of the subsidiaries of the
Borrower (other than Le Courrier du Sud (1998) Inc.) shall have been pledged in
accordance with the pledges described in Schedule 5, and all of the pledged
shares shall have been remitted to the Administrative Agent;

         (m) the Borrower shall have delivered to the Administrative Agent a
certificate signed by an officer stipulating and certifying that:

                  (i) such officer has taken cognizance of all the terms and
         conditions of this Agreement and of all contracts, agreements and deeds
         pertaining hereto;

                  (ii) no Default has occurred or exists hereunder which is
         continuing, and no Event of Default has occurred;

                  (iii) all Collateral is located in the jurisdictions
         described in a schedule thereto;

                  (iv) the corporate structure of the Borrower and its
         subsidiaries is as set out in the diagram attached to the certificate;
         and

                  (v) each of the Borrower and its subsidiaries holds the
         material Authorizations required in order to permit it to possess its
         property and its real estate and to carry on the Business in the manner
         in which it is being carried on at present;


         (n) nothing shall have occurred since December 31, 2002 which
would reasonably be expected to have a Material Adverse Effect;

         (o) all Fees and expenses (including the legal fees and disbursements
of counsel to the Administrative Agent and the Lenders) then payable under the
Credit Documents shall have been paid in full in the currency specified in the
invoice therefor, and the Borrower shall have complied with all of its
obligations to Banc of America Securities LLC under the Commitment



                                      50

Letter and the Fee Letter accepted by the Borrower dated January 13, 2003,
and each such letter shall be in full force and effect;

         (p) the Commitments under each of Facility A and Term Facility B shall
have been fully subscribed;

         (q) the financing contemplated by the Senior Notes shall have been
issued or shall be concurrently issued on terms reasonably satisfactory to the
Administrative Agent and the Lenders pursuant to definitive documentation in
form and substance reasonably satisfactory to the Administrative Agent;

         (r) favourable opinions of counsel to the Borrower and the Guarantors
in form and substance acceptable to the Administrative Agent and its counsel;
and

         (s) such other certificates and documentation as the Administrative
Agent may reasonably request.

                  SECTION 6.02. CONDITIONS PRECEDENT TO ALL ACCOMMODATIONS AND
CONVERSIONS. (1) The obligation of each Lender to make Accommodations or
otherwise give effect to any Accommodation Notice hereunder in respect of
Facility A or the Term Facility B shall be subject to the conditions precedent
that on the date of such Accommodation Notice and Accommodation, and after
giving effect thereto and to the application of any proceeds therefrom, (a) the
representations and warranties contained in Article 7 are true and correct in
all material respects on and as of such date (except where expressly stated to
be made at a particular date), all as though made on and as of such date; (b) no
event or condition has occurred and is continuing, or would result from such
Accommodation or giving effect to such Accommodation Notice, which constitutes a
Default or an Event of Default; and (c) nothing has occurred which would
reasonably be expected to have a Material Adverse Effect.

                  (2) Each of the giving of any Accommodation Notice by the
Borrower and the acceptance by the Borrower of any Accommodation shall be deemed
to constitute a representation and warranty by the Borrower that, on the date of
such Accommodation Notice or Accommodation, as the case may be, and after giving
effect thereto and to the application of any proceeds therefrom, the statements
set forth in Section 6.02(1) are true and correct.

                  SECTION 6.03. NO WAIVER. The making of an Accommodation or
otherwise giving effect to any Accommodation Notice hereunder, without the
fulfilment of one or more conditions set forth in Section 6.01 or 6.02, shall
not constitute a waiver of any such condition, and the Administrative Agent and
the Lenders reserve the right to require fulfilment of such condition in
connection with any subsequent Accommodation Notice or Accommodation.



                                      51


                                   ARTICLE 7
                       REPRESENTATIONS AND WARRANTIES

                  SECTION 7.01. REPRESENTATIONS AND WARRANTIES. The Borrower
represents and warrants to each Lender, acknowledging and confirming that each
Lender is relying thereon without independent inquiry in entering into this
Agreement and providing Accommodations hereunder, that:

         (a) INCORPORATION AND QUALIFICATION. The Borrower and each of the
Guarantors is a corporation duly incorporated, continued or amalgamated as the
case may be, and validly existing under the laws of the jurisdiction referred to
in Schedule 7.01(a) and each is duly qualified, licensed or registered to carry
on business under the Laws applicable to it in all jurisdictions in which the
nature of its Assets or business makes such qualification necessary and where
failure to be so qualified would reasonably be expected to have a Material
Adverse Effect.

         (b) CORPORATE POWER. The Borrower and each of the Guarantors has all
requisite corporate power and authority to (i) own and operate its properties
and Assets and to carry on the Business and any other business as now being
conducted by it; and (ii) enter into and perform its obligations under this
Agreement and the other Credit Documents to which it is a party.

         (c) CONFLICT WITH OTHER INSTRUMENTS. The execution and delivery of the
Credit Documents by the Borrower and each of the Guarantors which is a party
thereto and the performance by the Borrower and each of the Guarantors of their
respective obligations thereunder and compliance with the terms, conditions and
provisions thereof, will not (i) conflict with or result in a breach of any of
the terms, conditions or provisions of (A) its constating documents or by-laws,
(B) to a material extent, any applicable Law, (C) any material contractual
restriction binding on or affecting it or its properties, or (D) any material
judgment, injunction, determination or award which is binding on it; or (ii)
result in, require or permit (A) the imposition of any Lien in, on or with
respect to the Assets now owned or hereafter acquired by it (other than pursuant
to the Security Documents or which is a Permitted Lien), (B) the acceleration of
the maturity of any material Debt of the Borrower or any of its subsidiaries or
Holdco binding on or affecting it, or (C) any third party to terminate or
acquire any rights materially adverse to the Borrower or its subsidiaries, taken
as a whole, under any Material Agreement.

         (d) AUTHORIZATION, GOVERNMENTAL APPROVALS, ETC. The execution and
delivery of each of the Credit Documents by the Borrower and each of the
Guarantors which is a party thereto and the performance by each such Person of
its respective obligations hereunder and thereunder have been duly authorized by
all necessary corporate action and no Authorization (except such the absence of
which would not reasonably be expected to have a Material Adverse Effect) under
any applicable Law, and no registration, qualification, designation, declaration
or filing with any Governmental Entity, is or was necessary therefor or to
perfect the same, except



                                      52

as are in full force and effect, unamended, at the date hereof (or as may
become necessary subsequent to the date hereof and notice of which has been
given to the Administrative Agent).

         (e) EXECUTION AND BINDING OBLIGATION. This Agreement and the other
Credit Documents have been duly executed and delivered by the Borrower and each
of the Guarantors which is a party thereto and constitute legal, valid and
binding obligations of such Person, enforceable against it in accordance with
their respective terms, subject only to any limitation under applicable Laws
relating to (i) bankruptcy, insolvency, reorganization, moratorium or creditors'
rights generally; (ii) the discretion that a court may exercise in the granting
of equitable remedies; and (iii) such qualifications with respect to the limited
effect of certain Security taken, which in any event duplicates other Security
taken in different jurisdictions, as may be contained in the opinion of the
Borrower's legal counsel delivered at the Closing Date.

         (f) CONDUCT OF BUSINESS. Since December 31, 2002 and up to the Closing
Date, the Business has been carried on in the ordinary course. The Borrower and
its subsidiaries are not engaged in the business of extending credit for the
purpose of purchasing or carrying "margin stock", as defined in Federal Reserve
System Board of Governors Regulation U, and no proceeds of any Accommodations
will be used to purchase or carry any equity security of a class which is
registered pursuant to Section 12 of the U.S. SECURITIES EXCHANGE ACT OF 1934,
as amended, or any such margin stock, or for a purpose which violates, or would
be inconsistent with, Federal Reserve System Board of Governors Regulation T, U
or X. Terms used in this Section and in Section 3.1 for which meanings are
provided in Federal Reserve System Board of Governors Regulation T, U or X or
any regulations substituted therefor, as from time to time in effect, have the
meaning so provided. None of the Borrower and its subsidiaries is an "investment
company" or an "affiliated person" of, or "promoter" or "principal underwriter"
for, an "investment company", as such terms are defined in the INVESTMENT
COMPANY ACT OF 1940, as amended (15 U.S.C. ss. 80a-1 ET SEQ.). The application
of the proceeds of the Accommodations and repayment of the Accommodations
Outstanding by the Borrower and the performance by the Borrower of its
obligations hereunder and under the other Credit Documents and by the Guarantors
under the Credit Documents provided by them will not violate any provision of
the said Act, or any rule, regulation or order issued by the United States
Securities and Exchange Commission thereunder. Neither the Borrower nor any of
its subsidiaries is subject to regulation under the PUBLIC UTILITY HOLDING
COMPANY ACT OF 1935, the FEDERAL POWER ACT or the INTERSTATE COMMERCE ACT, or
under any other Law which may limit its ability to incur Debt or which may
otherwise render its obligations hereunder or under the other Credit Documents
unenforceable.

         (g) LOCATION OF BUSINESS. As of the date hereof, the only jurisdictions
(or registration districts within such jurisdictions) in which the Borrower or
any of the Guarantors has any place of business or stores any material tangible
personal property are as set forth in Schedule 7.01(g). The minute books of each
Loan Party are located at the addresses set out in part II of Schedule 7.01(g).

         (h) AUTHORIZATIONS, ETC. The Borrower and each of the Guarantors
possess all material Authorizations of federal, provincial, state and local
governments and regulatory



                                      53

authorities as may be necessary to properly conduct the Business, the failure
of which to possess would reasonably be expected to have a Material Adverse
Effect.

         (i) TRADEMARKS, PATENTS, ETC. Except as notified to the Administrative
Agent, the patents, trademarks, trade names and copyrights described in Schedule
7.01(i) are the only such registered intellectual property material to the
Business and are owned (as at the Closing Date or from time to time thereafter)
by the Borrower or its subsidiaries. The Borrower and each of the Guarantors
possess all other material trademarks, trade names, copyrights, patents,
licences, or rights in any thereof, reasonably necessary for the conduct of the
Business as now conducted and presently proposed to be conducted. To the best
knowledge of the Borrower and except as disclosed in Schedule 7.01(i), neither
it nor any of its subsidiaries is, as of the Closing Date, infringing or is
alleged to be infringing on the rights of any Person with respect to any patent,
trademark, trade name, copyright (or any application or registration respecting
any thereof), discovery, improvement, process, formula, know-how, data, plan,
specification, drawing or the like, except where such infringement could not
reasonably be expected to have a Material Adverse Effect.

         (j) OWNERSHIP OF PROPERTY. The Borrower and each of its subsidiaries
owns its Assets with good (and, with respect to any immovable or real property,
marketable) title thereto, free and clear of all Liens, except for Permitted
Liens. Neither the Borrower nor any of the Guarantors owns any real property
other than the Owned Properties (except as notified in writing to the
Administrative Agent) and is not bound by any agreement to own or lease any
immovable or real property providing for the payments of annual rent in excess
of $500,000 except for the Leases.

         (k) LEASED PROPERTIES. Each Lease in respect of the Leased Properties,
as it applies to the Borrower or any of the Guarantors, is in good standing in
all material respects and all amounts owing thereunder having been paid by the
Borrower or the Guarantor, to the extent that the failure to so comply would
reasonably be expected to have a Material Adverse Effect.

         (l) EXPROPRIATION. No part of the Owned Properties or the Leased
Properties has been taken or expropriated by any Governmental Entity, nor has
any written notice or proceeding in respect thereof been given or commenced nor
is the Borrower aware of any intent or proposal to give any such notice or
commence any proceedings, in each case, which would reasonably be expected to
have a Material Adverse Effect.

         (m) ENCROACHMENTS. The Buildings and Fixtures are located entirely
within the Owned Properties and the Leased Properties in conformity with
applicable set-back and coverage requirements and no dwellings of abutting
owners encroach upon the Owned Properties or the Leased Properties, in each
case, which would reasonably be expected to have a Material Adverse Effect.

         (n) COMPLIANCE WITH LAWS. As of the Closing Date, subject to the next
following sentence, the Borrower and each of the Guarantors is in compliance
with all applicable Laws, non-compliance with which would reasonably be expected
to have a Material Adverse Effect.



                                      54

Except as would not reasonably be expected to have a Material Adverse Effect,
the Borrower's and the Guarantors' Business, Owned Properties, Leased
Properties and other Assets (i) are in material compliance with all
Environmental Laws; (ii) possess and are operated in compliance with all
Environmental Permits which are required for the operation of the Business;
and (iii) are not subject to any past or present fact, condition or
circumstance that could result in any material liability under any
Environmental Laws.

         (o) SUBSIDIARIES, ETC. Except as set forth in Schedule 7.01(o), as of
the date hereof, the Borrower is the beneficial owner, directly or through other
Guarantors, of all of the issued and outstanding shares of each of the
Guarantors. No Person (other than the Borrower) has any right or option to
purchase or otherwise acquire any of the issued and outstanding shares of the
Guarantors. Except as set forth in Schedule 7.01(o), the Borrower does not own
or hold any shares of, or any other interest in, any other Person.

         (p) NO BURDENSOME AGREEMENTS. Neither the Borrower nor any of the
Guarantors is a party to any agreement or instrument or subject to any
restriction (including any restriction set forth in its constating documents or
by-laws) which would reasonably be expected to have a Material Adverse Effect.

         (q) NO LITIGATION. There are no investigations, actions, suits or
proceedings pending, taken or, to the Borrower's knowledge, threatened, before
or by any Governmental Entity or by any other Person, in Canada or elsewhere,
which would reasonably be expected to have a Material Adverse Effect.

         (r) PENSION PLANS AND EMPLOYMENT LIABILITIES. Schedule 7.01(r) contains
a list of all pension plans of the Borrower and the Guarantors as at the Closing
Date. All contributions required under applicable law under all pension plans in
respect of which a Loan Party could be liable have been made, except for amounts
not material to the Loan Parties on a consolidated basis. Each such plan was
fully funded as of the most recent actuarial assessment on a going concern and
solvency basis in accordance with the terms of such pension plan, except for
amounts not material to the Loan Parties on a consolidated basis. All
obligations (including wages, salaries, commissions and vacation pay) to current
employees and to former employees have been paid in full or duly provided for,
except for amounts not material to the Loan Parties on a consolidated basis.

         (s) MATERIAL AGREEMENTS. Neither the Borrower nor any of the Guarantors
is a party or otherwise subject to or bound or affected by any Material
Agreement (other than collective agreements), except as set out in Schedule
7.01(s). Except as contemplated hereunder, all Material Agreements are in full
force and effect, unamended, and neither the Borrower nor any of its
subsidiaries, or to the best of the Borrower's knowledge after due enquiry, any
other party to any such agreement, is in material default with respect thereto.

         (t) FINANCIAL STATEMENTS. The audited consolidated financial statements
of the Borrower dated December 31, 2002 and the other financial statements
delivered to the Administrative Agent pursuant to Section 8.01 have been
prepared in accordance with GAAP



                                      55

applied on a consistent basis throughout the periods specified (except as
noted thereon) and are an accurate representation of the consolidated
financial position of the Borrower and its subsidiaries as of the respective
dates specified and the results of their operations and changes in financial
position for the respective periods specified, all in accordance with GAAP.
No material adverse change in the financial results of the Borrower and its
subsidiaries, considered on a consolidated basis, has occurred since December
31, 2002.

         (u) BOOKS AND RECORDS. All books and records of the Borrower and each
of its subsidiaries have been fully, properly and accurately kept and completed
in accordance with GAAP (to the extent applicable) and there are no material
inaccuracies or discrepancies of any kind contained or reflected therein. The
Borrower's and each of its subsidiaries' records, systems, controls, data or
information are not recorded, stored, maintained, operated or otherwise wholly
or partly dependent upon or held by any means (including any electronic,
mechanical or photographic process, whether computerized or not) which
(including all means of access thereto and therefrom) are not under the direct
control of the Borrower or of an Affiliate of the Borrower, unless such means do
not prevent the Borrower from having access to same at all times (for example,
in the context of an outsourcing agreement).

         (v) INSURANCE. Each of the Borrower and the Guarantors has contracted
the insurance coverage required pursuant to Section 8.01(n).

         (w) SOLVENCY. The Borrower and each of the Guarantors, on a
consolidated and consolidating basis, both before giving effect to the
transactions contemplated by this Credit Agreement and the other Credit
Documents and after giving effect to same, including the provisions of all
contribution agreements among the Borrower and the Guarantors (a) is solvent,
(b) the fair value of the Assets of each such Person exceeds its total
liabilities (including Contingent Obligations but without duplication of any
underlying liability related thereto), (c) does not intend to, and does not
believe that it will, incur debts or liabilities beyond its ability to pay as
such debts and liabilities mature; and (d) is not engaged, and is not about to
engage, in business or transactions for which its property would constitute
unreasonably small capital.

         (x) TAX LIABILITY. The Borrower and each of the Guarantors has filed
within the prescribed delays all tax returns which are required to be filed, and
all taxes, Claims, assessments and other duties, interest and penalties levied
by the various Governmental Authorities with respect to the Borrower and its
subsidiaries have been paid when due, except for any such assessment, tax or
Claim (i) in an amount of up to $2,500,000 in the aggregate outstanding at any
time; or (ii) (A) which is being contested in good faith by proper legal
proceedings, for which adequate reserves have been established in the books of
the Borrower or the relevant Guarantor, and (B) the failure to effect such
filings or outcome of the contestation of which would not reasonably be expected
to have a Material Adverse Effect.

         (y) CORPORATE STRUCTURE. Except as notified to the Lenders, the only
direct and indirect, shareholders of the Borrower (other than shareholders of
Quebecor) are set forth in Schedule 7.01(y). Schedule 7.01(y) sets forth the
complete particulars at the date hereof of (i) such shareholders; (ii) the
interest of each shareholder in the Borrower; and (iii) the direct and indirect



                                      56


interests of each shareholder (other than Quebecor) and their respective
interests. Except as described in Schedule 7.01(y), none of the shareholders is
a party to any unanimous shareholders or other agreement relating to the shares
owned by such shareholder.

         (z) CONTINGENT OBLIGATIONS AND INDEBTEDNESS. Neither the Borrower nor
any of its subsidiaries has (a) any material Contingent Obligations or
contingent liabilities known to it which are not disclosed or referred to in the
most recent financial statements delivered to the Administrative Agent in
accordance with the provisions of Section 8.01 or otherwise disclosed to the
Administrative Agent in writing, or (b) incurred any material indebtedness which
is not disclosed in or reflected in such financial statements, or otherwise
disclosed to the Administrative Agent in writing, other than Contingent
Obligations, contingent liabilities or indebtedness incurred in the ordinary
course of business and Permitted Debt.

         (aa) DISCLOSURE. All (i) forecasts and projections supplied to the
Administrative Agent and the Lenders were prepared in good faith, disclosed all
assumptions relevant thereto and are, in the opinion of the Borrower's
management when taken together, reasonable estimates (as of the Closing Date) of
the prospects for the Business; and (ii) other written information heretofore
supplied to the Administrative Agent and the Lenders by the Borrower is complete
and accurate in all material respects. There is no fact known as of the Closing
Date to the Borrower, after reasonable investigation, which would reasonably be
expected to have a Material Adverse Effect and which has not been fully
disclosed in writing to the Administrative Agent and the Lenders. There has been
no change which has had or would reasonably be expected to have a Material
Adverse Effect since December 31, 2002 and up to the Closing Date.

                  SECTION 7.02 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties herein set forth or contained in any certificates
or documents delivered to the Administrative Agent and the Lenders pursuant
hereto shall not merge in or be prejudiced by and shall survive any
Accommodation hereunder and shall continue in full force and effect (as of the
date when made or deemed to be made) so long as any amounts are owing by the
Borrower to the Lenders hereunder. Schedules requiring updates shall be so
updated not less frequently than quarterly.



                                   ARTICLE 8

                           COVENANTS OF THE BORROWER

                  SECTION 8.01. AFFIRMATIVE COVENANTS. So long as any amount
owing hereunder remains unpaid or any Lender has any obligation under this
Agreement, and unless consent is given in accordance with Section 12.01 hereof,
the Borrower shall:

         (a) FINANCIAL REPORTING REQUIREMENTS. Furnish to the Administrative
Agent (in electronic and paper forms) (i) as soon as practicable, and in any
event within 60 days after the end of each of the first three Financial Quarters
in each Financial Year, unaudited consolidated



                                      57

financial statements of the Borrower, consisting of (A) a consolidated
balance sheet as at the end of the Financial Quarter with comparative amounts
at the end of the corresponding Financial Quarter in the previous Financial
Year, (B) consolidated statements of earnings, retained earnings and cash
flow for the Financial Quarter and for the period from the end of the
previous Financial Year to the end of the Financial Quarter with comparative
amounts for the corresponding periods in the previous Financial Year; (ii) as
soon as practicable, and in any event within 90 days after the end of each
Financial Year, audited consolidated financial statements of the Borrower,
consisting of (A) a consolidated balance sheet as at the end of the Financial
Year with comparative amounts at the end of the previous Financial Year, (B)
consolidated statements of earnings, retained earnings and cash flow for the
Financial Year with comparative amounts for the previous Financial Year, (C)
the audit report of the Borrower's independent auditors on the financial
statements specified in (ii)(A) and (B); (iii) as soon as practicable, and in
any event within 60 days after the end of each of the first three Financial
Quarters in each Financial Year, a Compliance Certificate and a certificate
(in such form and providing such detail as the Administrative Agent may
reasonably require) as to Excess Cash Flow for such Financial Quarter,
calculated (A) in respect of the preceding Financial Quarter and (B) in
respect of the four Financial Quarters (an "EXCESS CASH FLOW CERTIFICATE");
and (iv) as soon as practicable, and in any event within 90 days after the
end of each Financial Year, a Compliance Certificate and an Excess Cash Flow
Certificate.

         (b) ENVIRONMENTAL REPORTING. Promptly, and in any event within 10 days
of each occurrence, (i) notify the Administrative Agent of any proceeding or
order before any Governmental Entity requiring the Borrower or the Guarantors to
comply with or take action under any Environmental Laws and of any state or
affairs on the Owned Properties, Leased Properties or the Business which would
reasonably be expected to give rise to a future Claim, and (x) requiring
expenditures in the amount of $2,000,000 or more, (y) if any violation thereof
involves the reasonable possibility of the imposition of a fine or fines
aggregating $500,000 or more, or (z) the shutting down of any material facility
referred to in Schedule 7.01(j) or 7.01(k) for a period in excess of 48 hours;
and (ii) notify the Administrative Agent and the Lenders, within 10 days
therefrom, of any other occurrence which would reasonably be expected to have a
Material Adverse Effect, including the Borrower or any of its subsidiaries (A)
receiving a notice or claim to the effect that the Borrower or any of its
subsidiaries are liable to any Person in a material amount as a result of the
Release or threatened Release of any Hazardous Substance into the environment
in, on, under or adjacent to the Owned Properties or Leased Properties; (B)
receiving any notice that the Borrower or any of its subsidiaries is subject to
investigation by any Governmental Entity evaluating whether any Remedial Action
is needed to respond to the Release or threatened Release of any Hazardous
Substance into the environment, in, on, under or adjacent to the Owned
Properties or the Leased Properties; (C) receiving any notice that all or any
portion of the Owned Properties or the Leased Properties is subject to an order
or a Security Interest under or pursuant to any Environmental Law; (D) receiving
any notice of a material condition with respect to the Owned Properties or the
Leased Properties which might reasonably result in a notice of violation of any
Environmental Law; (E) receiving any notice of the commencement of any judicial
or administrative proceeding alleging a violation of any Environmental Law with
respect to the Owned Properties or the Leased Properties; or (F)



                                      58

undertaking any material activities as a result of new or proposed changes to
any existing Environmental Law that would reasonably be expected to have a
Material Adverse Effect.

         (c) ADDITIONAL REPORTING REQUIREMENTS. Deliver to the Administrative
Agent (i) as soon as practicable and in any event not more than 60 days after
the end of each Financial Year of the Borrower, the Annual Business Plan for the
next Financial Year together with detailed schedules and information
supplementary to and consistent with such Annual Business Plan; (ii) as soon as
possible, and in any event within five days after the Borrower becomes aware of
the occurrence of each Default or Event of Default, a statement of the chief
financial officer, treasurer or chief operating officer of the Borrower or any
other officer acceptable to the Administrative Agent setting forth the details
of such Default or Event of Default and the action which the Borrower proposed
to take or has taken with respect thereto; (iii) promptly notify the
Administrative Agent in writing of any default, or event, condition or
occurrence which with notice or lapse of time, or both, would constitute a
default under any agreement in respect of Debt to which the Borrower or any of
its subsidiaries owes (contingently or otherwise) at least $10,000,000 (or the
equivalent amount in any other currency); (iv) from time to time upon request of
the Administrative Agent, evidence of maintenance of all insurance required to
be maintained by Section 8.01(o), including such originals or copies as the
Administrative Agent may reasonably request of policies, certificates of
insurance, riders and endorsements relating to such insurance and proof of
premium payments; (v) promptly upon the issuance thereof, copies of all notices
and other documents in respect of the Borrower or the Guarantors filed with, or
delivered to, any stock exchange or to the Quebec or Ontario Securities
Commission or similar Governmental Entity in any other jurisdiction (with the
exception of any private and confidential filings) by the Borrower or any
Guarantor; (vi) promptly, and in any event within 10 days after the Borrower or
any of its subsidiaries receives notice of any suit, proceeding or similar
action commenced or threatened by any Governmental Entity or any other Person,
which would reasonably be expected to have a Material Adverse Effect; and (vii)
such other information respecting the condition or operations, financial or
otherwise, of the business of the Borrower or any of its subsidiaries as the
Administrative Agent, on behalf of the Lenders, may from time to time reasonably
request.

         (d) CORPORATE EXISTENCE. Except as permitted pursuant to Section
8.02(c), preserve and maintain, and cause each of the Guarantors to preserve and
maintain, its corporate existence.

         (e) COMPLIANCE WITH LAWS, ETC. Comply, and cause each of the Guarantors
to comply, with the requirements of all applicable Laws, non-compliance with
which would reasonably be expected to have a Material Adverse Effect.

         (f) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and cause
each of the Guarantors to maintain and preserve, all of its and their respective
properties used or useful in its Business in all material respects in good
repair, working order and condition (reasonable wear and tear excepted) and,
from time to time, make all needful and proper repairs, renewals, replacements,
additions and improvements thereto, so that the Business may be properly and
advantageously conducted at all time in accordance with prudent business
management.



                                      59

         (g) STATUS OF ACCOUNTS AND COLLATERAL. With respect to the
Collateral (i) maintain books and records pertaining to the Collateral in
such detail, form and scope as the Administrative Agent shall reasonably
require; (ii) immediately notify the Administrative Agent of any Governmental
Entity in respect of which accounts in excess of $2,000,000 may arise at any
time or from time to time (other than amounts owed to the Borrower or such
Guarantor by such Governmental Entity), and execute any instruments and take
any steps required by the Administrative Agent in order that all moneys due
or to become due from time to time from such Governmental Entities are
assigned to the Lenders and notice thereof be given to any such Governmental
Entity; and (iii) report immediately to the Administrative Agent any matters
materially adversely affecting the value, enforceability or collectability of
any of the Collateral.

         (h) CONDUCT OF BUSINESS AND HEDGING REQUIREMENTS. Conduct, and cause
each of the Guarantors to conduct, in each Financial Year, the Business in a
prudent manner and consistent with good business practices. Maintain the
Hedging Requirements.

         (i) ENVIRONMENTAL AUDITS. Promptly (i) if the Administrative Agent
has a good faith concern that there is non-compliance by the Borrower or any
of its subsidiaries with Environmental Laws which would reasonably be
expected to have a Material Adverse Effect, conduct such environmental audits
(by an environmental auditor or auditors approved by the Administrative Agent
and, prior to the occurrence of an Event of Default which is continuing, the
Borrower) concerning such alleged material non-compliance as the
Administrative Agent may request and permit the Administrative Agent and the
Lenders to discuss such audits with such auditors; and (ii) remedy any
material non-compliance with Environmental Laws revealed by any such audit.
Such audit shall be at the Borrower's expense.

         (j) AUDITORS. Appoint and maintain as its auditors a firm of
national standing.

         (k) PAYMENT OF TAXES AND CLAIMS. Pay and discharge, and cause each
of the Guarantors to pay and discharge, before the same shall become
delinquent, (i) all taxes, assessments and governmental charges or levies
imposed upon it or upon the Assets or upon its subsidiaries; and (ii) all
lawful Claims which, if unpaid, would by Law become a Lien (other than a
Permitted Lien) upon the Assets, except for any such assessment, tax or Claim
(I) in an amount of up to $2,500,000 in the aggregate outstanding at any
time; or (II)(A) which is being contested in good faith by proper legal
proceedings, for which adequate reserves have been established in the books
of the Borrower or the relevant Guarantor, and (B) the outcome of the
contestation of which or the failure to comply with this covenant would not
reasonably be expected to have a Material Adverse Effect.

         (l) KEEPING OF BOOKS. Keep, and cause each of the Guarantors to
keep, proper books of record and account, in which full and correct entries
shall be made of all financial transactions and the Assets and Business in
accordance with GAAP (to the extent applicable).

         (m) VISITATION AND INSPECTION. At (i) any reasonable time or times
and upon reasonable prior notice, and at least semi-annually, permit the
Administrative Agent on behalf of the Lenders to visit the properties of the
Borrower or any of the Guarantors or the location of the



                                      60

chief financial officer, and to discuss the affairs, finances and accounts of
the Borrower or any of the Guarantors with executive management including the
officer appointed as (or performing the functions of) the chief financial
officer thereof. If a Default has occurred and is continuing or an Event of
Default has occurred and not been waived, the Borrower shall be required to
reimburse the Administrative Agent or its mandatary for any related expenses
and fees; and (ii) at least annually, permit the Lenders to have access to
the Borrower's chief financial officer controller for the purpose of
reviewing the affairs, finances and accounts of the Borrower and its
subsidiaries.

         (n) MAINTENANCE OF INSURANCE. Maintain, in respect of itself and
each of the Guarantors, insurance at all times with responsible insurance
carriers in such amounts and covering such risks as are usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas in which the Borrower or any such Guarantor, as the case
may be, operate, such policies to show the Administrative Agent, for and on
behalf of the Lenders, as loss payee thereof under a mortgage clause in a
form approved by the Insurance Bureau of Canada and promptly furnish or cause
to be furnished evidence thereof to the Administrative Agent and the Lenders.

         (o) CURE DEFECTS, PRESERVATION OF SECURITY. Take all necessary steps
to preserve and maintain in effect the rights of the Administrative Agent and
the Lenders, as well as any collateral agent designated by the Administrative
Agent, pursuant to the Security Documents, to the extent the Loan Parties
have any knowledge of any deficiency, together with any renewals thereof or
additional documents creating Liens that may be required from time to time.
Upon the reasonable request of the Administrative Agent, promptly cure or
cause to be cured any defects in the execution and delivery of any of the
Credit Documents or any of the other agreements, instruments or documents
contemplated thereby or executed pursuant thereto or any defects in the
validity of enforceability of any of the Security, and at its expense,
execute and deliver or cause to be executed and delivered, all such
agreements, instruments and other documents as the Administrative Agent may
consider necessary or desirable for the foregoing purposes.

         (p) FURTHER ASSURANCES. At the Borrower's cost and expense, upon the
reasonable request of the Administrative Agent, duly execute and deliver or
cause to be duly executed and delivered to the Administrative Agent such
further instruments and do and cause to be done such further acts as may be
necessary or proper in the reasonable opinion of the Administrative Agent to
carry out more effectually the provisions and purposes of the Credit
Documents. In addition, if any new subsidiary of the Borrower is created or
acquired, such subsidiary will become a Guarantor and will provide Security
on all of its Assets by executing a guarantee and appropriate Security
Documents in form and substance satisfactory to the Administrative Agent and
its counsel.

                  SECTION 8.02. NEGATIVE COVENANTS. So long as any amount
owing hereunder remains unpaid or any Lender has any obligation under this
Agreement, and unless consent is given in accordance with Section 12.01
hereof, the Borrower shall not:



                                      61

         (a) DEBT. Create, incur, assume or suffer to exist, or permit any of
the Guarantors to create, incur, assume or suffer to exist, any Debt other
than (i) Debt under this Agreement; and (ii) Permitted Debt.

         (b) ENCUMBRANCES. Create, incur, assume or suffer to exist, or
permit any of the Guarantors to create, incur, assume or suffer to exist any
Lien on any of its or their, as the case may be, respective Assets, other
than Permitted Liens.

         (c) MERGERS, ETC. Enter into, or permit any of the Guarantors to
enter into, any transaction (whether by way of reconstruction,
reorganization, consolidation, amalgamation, winding-up, merger, transfer,
sale, lease or otherwise) whereby all or any substantial part of its
undertaking or Assets would become the property of any other Person (except
that the Loan Parties may enter into any such transaction with each other),
unless (i) immediately after giving effect thereto, no event shall have
occurred and be continuing which constitutes a Default or Event of Default,
(ii) in the case of any transaction involving the Borrower or any Guarantor,
the corporation continuing from any such transaction shall be a corporation
organized and existing under the laws of Canada or any province thereof,
(iii) such continuing corporation shall assume the Borrower's or such
Guarantor's obligation, if any, under the Credit Documents, pursuant to an
agreement in form and substance satisfactory to the Administrative Agent,
provided that such agreement shall not be required if such obligations are
otherwise assumed by operation of Law, (iv) if the transaction in question is
with a Person (A) who was not a subsidiary of a Loan Party immediately before
the effective date thereof, the transaction, in the sole opinion of the
Majority Lenders acting reasonably, would not reasonably be expected to have
a Material Adverse Effect, or (B) who was a subsidiary of a Loan Party
immediately before the effective date thereof, the proposed transaction will
not have a detrimental effect on the financial condition of any of the Loan
Parties, nor on the rights of the Administrative Agent and the Lenders under
the Credit Documents, and (v) the Lenders shall have received an opinion of
counsel to the Borrower, acceptable to them, that such transaction complies
with Law and other matters of Law referred to in this Section 8.02(c), or
except as permitted under Section 8.02(d).

         (d) DISPOSAL OF ASSETS GENERALLY. Dispose of, or permit any of the
Guarantors to Dispose of, any Assets to any Person, other than, (i) any
disposition of Assets between the Loan Parties; (ii) pursuant to a
transaction consummated in accordance with Section 8.02(c); (iii)
Dispositions of inventory and other Assets in the ordinary course of
business; (iv) so long as no Default has occurred and is continuing or would
arise therefrom and no Event of Default has occurred, the Disposition of the
Florida Sun at fair market value; (v) so long as no Default has occurred and
is continuing or would arise therefrom and no Event of Default has occurred,
any other BONA FIDE Dispositions at fair market value, provided the proceeds
thereof are dealt with in accordance with Section 2.05(2) hereof to the
extent applicable, and in any event limited to an aggregate maximum amount
during the Term of Facility A or Term Facility B, whichever expires last,
together with all sale and leaseback transactions referred to in clause (vii)
below, of $50,000,000; (vi) Dispositions of Assets which are obsolete, worn
out, surplus, damaged or of no material economic value in the Business; (vii)
sale and leaseback transactions, subject to the limitations in clause (v)
above, and (viii) so long as no Default has occurred and is continuing or
would arise therefrom and no Event of Default has occurred, BONA FIDE
exchanges of similar



                                      62

Assets at fair market value, subject to an aggregate amount of $50,000,000
during the last to expire of the Term of Facility A or of Term Facility B.

         (e) TRANSACTIONS WITH AFFILIATES. Subject to the following
sentences, directly or indirectly (i) purchase, acquire, lease or licence any
material property, right or service from; (ii) sell, transfer, lease or
licence any Assets or right to; or (iii) permit any of the Guarantors to
purchase, acquire, lease or licence any Asset, right or service from, or
sell, transfer, lease or licence any material property or right to, any
Person not at Arm's Length with the Borrower or any of the Guarantors, except
at prices and on terms not less favourable to the Borrower or any of the
Guarantors, as the case may be, than those which would have been obtained in
an Arm's Length transaction with an Arm's Length Person. Notwithstanding the
foregoing, (i) the Loan Parties may (A) enter into such transactions with
each other; and (B) make or pay Permitted Distributions, and (ii) the
Borrower may perform its obligations in connection with, or redeem or repay,
the Back-to-Back Securities, the Existing Back-to-Back Securities or the Tax
Benefit Transactions.

         (f) CHANGE IN BUSINESS. Make, or permit to be made, any material
change in the Business.

         (g) SHARE CAPITAL. Issue, or permit any of the Guarantors to issue,
any shares, or any options, warrants or securities convertible into shares,
except (i) to Quebecor Media Inc. or any Affiliate thereof or any qualifying
shares issued to any directors and officers; and (ii) an issue of shares to
the Borrower or to a Guarantor by a subsidiary of the Borrower.

         (h) DISTRIBUTIONS. (1) Declare, make or pay, or permit any of its
subsidiaries to declare, make or pay, any Distributions which are not
Permitted Distributions;

                  (2) Any payment of a Permitted Distribution of Excess Cash
Flow (an "EXCESS CASH FLOW DISTRIBUTION") shall be deemed to have been made
in the Financial Quarter in respect of which the Excess Cash Flow was
generated, despite the fact that the Excess Cash Flow Distribution can only
be made in the next Financial Quarter based on the Excess Cash Flow
Certificate in respect of the preceding Financial Quarter. At the end of each
Financial Quarter, and at the end of each Financial Year, the Borrower will
deliver the Excess Cash Flow Certificate and a Compliance Certificate in the
manner and at the times contemplated by Section 8.01(a). The Borrower shall
be able to make an Excess Cash Flow Distribution based on the Cash Flow
Certificate delivered in respect of the preceding Financial Quarter. If, as a
result of negative Excess Cash Flow in one or more subsequent Financial
Quarters, the aggregate amount of Excess Cash Flow Distributions validly made
at the end of a previous Financial Quarter exceeds the amount of the Excess
Cash Flow which could be a Permitted Distribution, the Borrower shall not for
this reason alone be in Default hereunder; but no additional Excess Cash Flow
Distribution may be made until such time as a subsequently delivered Excess
Cash Flow Certificate demonstrates that any shortfall in the portion of
Excess Cash Flow which may have been the object of a Permitted Distribution
has been recouped, and that there is additional Excess Cash Flow in excess of
the amount of such shortfall which may at such time be the object of a
Permitted Distribution.



                                      63

         (i) LOANS, INVESTMENTS AND ACQUISITIONS. Make any loans (other than
loans to Quebecor Media Inc. made out of Excess Cash Flow, subject to having
first provided to the Administrative Agent an Excess Cash Flow Certificate in
respect of the particular period in question, or out of amounts that could
constitute Additional Distributions), Investments or Acquisitions, (other
than in connection with Capital Expenditures permitted pursuant to Section
8.02(m)), or permit any of the Guarantors to make any such loans, Investments
or Acquisitions, except, in each case, for (i) the Hedging Agreements in
connection with the Hedging Requirements, other Hedging Agreements and other
foreign currency hedges, interest rate swaps or similar interest rate and
currency hedging obligations or agreements, in each case incurred in the
ordinary course of the Business and not for speculative purposes; (ii) loans,
Acquisitions and Investments among the Loan Parties; and (iii) Permitted
Investments.

         (j) RENTAL OBLIGATIONS. Incur, create, assume or permit to exist or
permit any of the Guarantors to incur, create, assume or permit to exist, in
respect of any operating lease of real or personal property entered into
after the date hereof, rental obligations or other commitments thereunder to
make any direct or indirect payment in any Financial Year, whether as rent or
otherwise, for fixed or minimal rentals, percentage rentals, property taxes
or insurance premiums, in an aggregate amount greater than $20,000,000.

         (k) SUBSIDIARIES. (1) Permit the subsidiaries of the Borrower which
are not Guarantors to be wholly-owned, directly or indirectly, by the
Borrower; or (2) permit the aggregate of such subsidiaries' EBITDA or Assets,
when considered together with the EBITDA or Assets of all other subsidiaries
that are not Guarantors, to exceed 10% of the EBITDA or Assets of the
Borrower on a consolidated basis; for the purposes hereof, "Assets" excludes
the effect of all Back-to-Back Transactions; or (3) permit any Guarantor to
assume, enter into or otherwise become bound by any agreement or undertaking
that would reasonably be expected to prevent such Guarantor from declaring or
paying dividends or inter-company payments or Distributions of any kind.

         (l) MAINTENANCE AND OWNERSHIP OF SUBSIDIARIES. Sell or otherwise
dispose of any shares of any of the Guarantors or permit any of the
Guarantors to issue, sell or otherwise dispose of any of their shares or the
shares of any other Guarantor, except to the Borrower or a Guarantor, or
except pursuant to a Disposition permitted hereunder.

         (m) CAPITAL EXPENDITURES. Make or commit to make, or permit any of
the Guarantors to make or commit to make, in any Financial Year (or part
thereof), any Capital Expenditures, except (i) Capital Expenditures in an
amount not exceeding $25,000,000 (the "CAPEX LIMIT"); provided that if no
Default has occurred and is continuing and no Event of Default has occurred,
any portion of the Capex Limit which is not used in a Financial Year may be
carried over into the next Financial Year alone, (ii) Capital Expenditures
using Net Proceeds of Dispositions which have not been used to effect a
Mandatory Prepayment or a Permitted Distribution, and (iii) Capital
Expenditures made using insurance, condemnation awards or expropriation
proceeds.



                                      64


        (n) BUSINESS OUTSIDE CERTAIN JURISDICTIONS. Keep or store any
material tangible property outside of those jurisdictions (or registration
districts within such jurisdictions) set forth in Schedule 7.01(g) or permit
any of the Guarantors to do so (i) except upon 30 days' prior written notice
thereof to the Administrative Agent; and (ii) unless the Borrower has done or
caused to be done all such acts and things and executed and delivered or
caused to be executed and delivered all such deeds, transfers, assignments
and instruments as the Administrative Agent may reasonably require for
perfecting a Security Interest in such property in favour of the
Administrative Agent and the Lenders.

         (o) FINANCIAL YEAR.  Change its Financial Year.

         (p) AMENDMENTS. Allow (i) any amendments to its or any of the
Guarantors' constating documents or by-laws which are adverse to the Lenders
interests hereunder or the Security Interests arising under or created by the
Security Documents; or (ii) any amendments to, or grant any waivers in
respect of the Senior Note Indenture which would be materially adverse to the
position of the Lenders (and in particular, shortening the maturity date
thereof or providing for any prepayment thereof in excess of the amount
permitted as a Permitted Distribution), in each case, without the prior
written consent of the Administrative Agent upon instructions from the
Majority Lenders.

                  SECTION 8.03. FINANCIAL COVENANTS. So long as any amount owing
hereunder remains unpaid or any Lender has any obligations under this Agreement,
and unless consent is given in accordance with Section 12.01 hereof, the
Borrower shall:

         (a) LEVERAGE RATIO. Maintain, at all times, tested as at the end of
each Financial Quarter in each Financial Year, a maximum Leverage Ratio,
calculated as at the end of such Financial Quarter for the four Financial
Quarters then ended, as follows:




- --------------------------------------------------------- -----------------------
PERIOD                                                            RATIO
                                                               
- --------------------------------------------------------- -----------------------
- --------------------------------------------------------- -----------------------
Closing Date to December 31, 2003                                 3.75:1
- --------------------------------------------------------- -----------------------
- --------------------------------------------------------- -----------------------
January 1, 2004 to December 31, 2004                              3.50:1
- --------------------------------------------------------- -----------------------
- --------------------------------------------------------- -----------------------
January 1, 2005 to December 31, 2006                              3.25:1
- --------------------------------------------------------- -----------------------
- --------------------------------------------------------- -----------------------
January 1, 2007 and thereafter                                    2.75:1
- --------------------------------------------------------- -----------------------



         (b) INTEREST COVERAGE RATIO. Maintain, at all times, tested as at the
end of each Financial Quarter in each Financial Year, a minimum Interest
Coverage Ratio, calculated as at the end of such Financial Quarter for the four
Financial Quarters then ended, as follows:




- --------------------------------------------------------- -----------------------
PERIOD                                                            RATIO
                                                               
- --------------------------------------------------------- -----------------------
- --------------------------------------------------------- -----------------------
Closing Date to December 31, 2004                                 3.00:1
- --------------------------------------------------------- -----------------------
- --------------------------------------------------------- -----------------------
January 1, 2005 to December 31, 2006                              3.25:1
- --------------------------------------------------------- -----------------------
- --------------------------------------------------------- -----------------------
January 1, 2007 and thereafter                                    3.50:1
- --------------------------------------------------------- -----------------------





                                      65

         (c) FIXED CHARGE COVERAGE RATIO. Maintain, at all times, tested as
at the end of each Financial Quarter in each Financial Year, a minimum Fixed
Charge Coverage Ratio calculated as at the end of such Financial Quarter for
the four Financial Quarters then ended, of not less than 2:1.

                                  ARTICLE 9
                              EVENTS OF DEFAULT

                  SECTION 9.01. EVENTS OF DEFAULT. The occurrence of any of
the following events (each an "EVENT OF DEFAULT") shall constitute an Event
of Default unless remedied within the prescribed delays or waived by the
requisite majority of Lenders:

         (a) the Borrower shall fail to pay any amount of the Accommodations
Outstanding when such amount becomes due and payable;

         (b) the Borrower shall fail to pay any interest or Fees when the
same become due and payable hereunder and such failure shall remain
unremedied for three Business Days;

         (c) any representation or warranty or certification made or deemed
to be made by the Borrower or any of the Guarantors or any of their
respective directors or officers in this Agreement or any other Credit
Document to which it is a party shall prove to have been incorrect in any
material respect when made or deemed to be made;

         (d) the Borrower shall fail to perform, observe or comply with any
of the covenants contained in (i) Sections 8.02 (a), (b), (f), (g), (i), (j),
(m) or (n), and such failure shall remain unremedied for three (3) Business
Days from the Loan Party's knowledge of such event, or (ii) the other
subsections of Section 8.02, or (iii) Section 8.03;

         (e) the Borrower shall fail to perform, observe or comply with any
of the covenants contained in this Agreement and such failure shall remain
unremedied for 15 days following notice thereof by the Administrative Agent
to the Borrower;

         (f) the Borrower or any of the Guarantors shall fail to perform or
observe any other term, covenant or agreement contained in any Credit
Document to which it is a party and such failure shall remain unremedied for
15 days following notice thereof by the Administrative Agent to the Borrower;

         (g) the Borrower or any of the Guarantors shall fail to perform or
observe any material term, covenant or agreement contained in any Material
Agreement on its part to be performed or observed and, as a result thereof,
any Material Agreement shall be terminated, revoked or permitted to lapse
(other than as approved by the Administrative Agent); or any party to any
Material Agreement shall deliver a notice of termination or revocation in
respect of such Material Agreement to the Borrower or any of its subsidiaries
at any time;



                                      66

         (h) the Borrower or any of the Guarantors shall fail to pay the
principal of or premium or interest on any Debt of the Borrower or such
Guarantor (excluding any Debt hereunder and under a Hedging Agreement) which
is outstanding in an aggregate principal amount exceeding $25,000,000 (or the
equivalent amount in any other currency), when such amount becomes due and
payable (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise) and such failure shall continue after the applicable
grace period, if any, specified in the agreement or instrument relating to
such Debt which has not been extended, waived or modified; or any other event
shall occur or condition shall exist, and shall continue after the applicable
grace period, if any, specified in any agreement or instrument relating to
any such Debt, if the effect of such event is to accelerate, or permit the
acceleration of such Debt; or any such Debt shall be declared to be due and
payable prior to the stated maturity thereof;

         (i) the Borrower or any of the Guarantors shall fail to pay the
principal of or premium or interest on any Debt of the Borrower or such
Guarantor under a Hedging Agreement or under the Overdraft Facility when such
amount becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise) and such failure shall
continue after the applicable grace period, if any, specified in the
agreement or instrument relating to such Debt which has not been extended,
waived or modified, if the effect of such event is to accelerate such Debt;
or any other event shall occur or condition shall exist, and shall continue
after the applicable grace period, if any, specified in any agreement or
instrument relating to any such Debt, if the effect of such event is to
accelerate such Debt;

         (j) any seizure, taking of possession, or process of execution is
enforced or levied upon material property having a value of $5,000,000 or
more of the Borrower or any of the Guarantors and remains unsatisfied for a
period (for each action) of 60 days, as to movable or personal property, or
90 days as to immovable or real property, and, in any event, not less than 10
days prior to the date fixed for the sale of any such property;

         (k) any judgment or order for the payment of money in excess of
$10,000,000 (or the equivalent amount in any other currency), net of
applicable insurance coverage pursuant to which liability is acknowledged in
writing by the insurer, with a copy promptly provided to the Administrative
Agent, shall be rendered against the Borrower or any of the Guarantors and
remains undischarged or unsatisfied for a period ending on the earlier of (a)
30 days from the date of such judgment (unless appealed and provided, in such
case, that there shall be a stay of enforcement of such judgment or order
during such period); or (b) the 5th day prior to the date on which such
judgment becomes executory;

         (l) the Borrower or any of the Guarantors shall (i) become insolvent
or generally not pay its debts as such debts become due; (ii) admit in
writing its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; (iii) institute or have instituted
against it any proceeding seeking (x) to adjudicate it a bankrupt or
insolvent, (y) any liquidation, winding-up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any
Law relating to bankruptcy, insolvency, reorganization or relief of debtors
including any plan of compromise or arrangement or other similar corporate
proceeding involving or effecting its creditors, or (z) the entry of an order
for relief or the



                                      67

appointment of a receiver, trustee or other similar official for it or for
any substantial part of its Assets, and in the case of any such proceeding
instituted against it (but not instituted by it), either such proceeding
shall remain undismissed or unstayed for a period of 45 days, or any of the
actions sought in such proceeding (including the entry of an order for relief
against it or the appointment of a receiver, trustee, custodian or other
similar official for it or for any substantial part of its Assets) shall
occur; or (iv) take any corporate action to authorize any of the foregoing
actions;

         (m) if any guarantee provided by a Guarantor shall be cancelled,
terminated, revoked or rescinded, or if any of the Credit Documents shall be
cancelled, terminated, revoked or rescinded or the Administrative Agent's
Security Interests in the Collateral shall cease to be perfected, or shall
cease to have the priority contemplated by the Security Documents, in each
case to the extent any such event would reasonably be expected to have a
Material Adverse Effect and otherwise than in accordance with the terms
thereof or with the express prior written agreement, consent or approval of
the Lenders, or any action at law, suit or in equity or other legal
proceeding to cancel, revoke or rescind any of the Credit Documents shall be
commenced by or on behalf of the Borrower or any of the Guarantors thereto or
any of their respective stockholders, or any court or any other governmental
or regulatory authority or agency of competent jurisdiction shall make a
determination that, or issue a judgment, order, decree or ruling to the
effect that, any one or more of the Credit Documents is illegal, invalid or
unenforceable in accordance with the terms thereof, unless such Credit
Document is duly replaced with a fully enforceable one within 7 days any such
event;

         (n) a Change of Control; or

         (o) any Impermissible Qualification of the audited financial
statements of the Borrower by its independent auditors;

then, (A) if the Event of Default that occurred is that mentioned in
paragraph (k) above, all Accommodations Outstanding, together with all
interest and Fees accrued thereon and all other amounts payable under this
Agreement in respect of the Credit Facilities, shall immediately become due
and payable, without demand, presentation, protest or other notice of any
nature, to which the Borrower expressly renounces; and (B) if the Event of
Default that occurred was any other Event of Default, the Administrative
Agent may, and shall at the request of the Majority Lenders, (i) terminate
the Lenders' obligations to make further Accommodations under the Credit
Facilities; and (ii) (at the same time or at any time after such termination)
declare the principal amount of all Accommodations Outstanding, together with
all interest and Fees accrued thereon and all other amounts payable under
this Agreement in respect of the Credit Facilities, to be immediately due and
payable, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by each Borrower. For greater
certainty, from and after the occurrence of a Default or Event of Default,
the Lenders shall not be obliged to provide any Accommodation hereunder.

                  Upon the acceleration of any amount hereunder and
notwithstanding anything herein to the contrary, the Borrower hereby
acknowledges that it shall be then indebted to, and



                                      68

shall be obligated to pay to the Administrative Agent, as a separate and
absolute obligation, all unpaid principal amount of and accrued interest on
Accommodations Outstanding, all Fees and all other amounts payable under this
Agreement. Such payment to the Administrative Agent when made shall be deemed
to have been made in discharge of the Borrower's obligations hereunder, and
the Administrative Agent shall distribute such proceeds among the Lenders as
provided herein.

                  SECTION 9.02. REMEDIES UPON DEMAND AND DEFAULT. (1) Upon a
declaration that the Accommodations Outstanding under the Credit Facilities
are immediately due and payable pursuant to Section 9.01, the Administrative
Agent shall at the request of, or may with the consent of, the Majority
Lenders, commence such legal action or proceedings as it, in its sole
discretion, may deem expedient, including the commencement of enforcement
proceedings under the Security Documents or any other security granted by the
Borrower, any Guarantor or others to the Administrative Agent or the Lenders,
or both, all without any additional notice, presentation, demand, protest,
notice of dishonour, entering into of possession of any of the Assets, or any
other action or notice, all of which the Borrower hereby expressly waives.

                  (2) The rights and remedies of the Administrative Agent and
the Lenders hereunder and under the other Credit Documents are cumulative and
are in addition to and not in substitution for any other rights or remedies.
Nothing contained herein or in the Security Documents or any other security
hereafter held by the Administrative Agent and the Lenders, with respect to
the indebtedness or liability of the Borrower or the Guarantors to the
Administrative Agent and the Lenders, or any part thereof, nor any act or
omission of the Administrative Agent or the Lenders with respect to the
Security Documents, the Security or such other security, shall in any way
prejudice or affect the rights, remedies and powers of the Administrative
Agent and the Lenders hereunder or under the Security Documents or such
Security.

                  SECTION 9.03. BANKRUPTCY AND INSOLVENCY. If the Borrower
files a notice of intention to file a proposal, or files a proposal under the
Bankruptcy and Insolvency Act, or if the Borrower obtains the permission of
the court to file a Plan of Arrangement under the Companies' Creditors
Arrangements Act, and if a stay of proceedings is obtained or ordered under
the provisions of either of those statutes, without prejudice to the Lenders'
rights to contest such stay of proceedings, the Borrower covenants and agrees
to continue to pay interest on all amounts due to the Lenders in accordance
with the provisions hereof. In this regard, the Borrower acknowledges that
permitting the Borrower to continue to use the proceeds of the Accommodations
constitutes valuable consideration provided after the filing of any such
proceeding in the same way that permitting the Borrower to use leased
premises constitutes such valuable consideration.

                  SECTION 9.04. RELATIONS WITH THE BORROWER. The
Administrative Agent may grant delays, take security or renounce thereto,
accept compromises, grant acquittances and releases and otherwise negotiate
with the Borrower and any Guarantor as it deems advisable without in any way
diminishing the liability of the Borrower or any Guarantor nor prejudicing
the rights of the Lenders with respect to the Security.



                                      69

                  SECTION 9.05. APPLICATION OF PROCEEDS. Following the
occurrence of an Event of Default which has not been waived, subject to the
provisions hereof, the Administrative Agent may apply the proceeds of
realization of the property contemplated by the Security Documents and of any
credit or compensating balance in reduction of the part of the Accommodations
(principal, interest or accessories and/or the Negative Value of Hedging
Agreements entered into with a Lender) which the Administrative Agent judges
appropriate; provided that, to the extent practicable, the Administrative
Agent will follow the order contemplated by Section 2.09(2) hereof. If any
Lender is owed money by the Borrower as a result of Hedging Agreements, and,
in particular, as a result of the Negative Value of Hedging Agreements, the
claim of such Lender, as well as the claim of the Person providing the
Overdraft Facility for all amounts owed thereunder,shall rank PARI PASSU with
the other amounts comprising the Accommodations.

                                  ARTICLE 10
                    THE ADMINISTRATIVE AGENT AND THE LENDERS

                  SECTION 10.01.   AUTHORIZATION  AND  ACTION.  (1)  Each
Lender  irrevocably  appoints  and  authorizes  the Administrative Agent to
take such action as agent on its behalf and to exercise such powers under
this Agreement as are delegated to it by the terms of this Agreement,
together with the powers reasonably incidental thereto, but the
Administrative Agent shall not have any duties or responsibilities, except
those expressly set forth herein, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Credit Document or otherwise exist against the
Administrative Agent. As to any matters not expressly provided for by this
Agreement, the Administrative Agent shall act or refrain from acting (and
shall be fully protected in so doing) upon the joint instructions of the
Majority Lenders which instructions shall be binding upon all Lenders but, in
the absence of any such instructions, the Administrative Agent may (but shall
not be obliged to) act as it shall deem fit in the best interests of the
Lenders, and any such instructions and any action taken by the Administrative
Agent in accordance herewith shall be binding upon each Lender. The
Administrative Agent shall not, by reason of this Agreement, be deemed to be
a trustee or fiduciary for the benefit of any Lender, the Borrower or any
other Person. The Administrative Agent shall not be required to take any
action which (i) exposes it to personal liability; (ii) is contrary to this
Agreement or any applicable Law; (iii) would require it to become registered
to do business in any jurisdiction; or (iv) would subject it to taxation or
additional taxation in any jurisdiction.

                  (2) The Administrative Agent has no duties or obligations
other than as set out in this Agreement and there shall not be construed
against the Administrative Agent any implied duties (including fiduciary
duties), obligations or covenants. The Administrative Agent may execute or
perform, and may delegate the execution and performance of, any of its
powers, rights, discretions and duties under the Credit Documents through or
to any Persons designated by it. References in any Credit Document to an
Agent shall include references to any such Persons.



                                      70

                  (3) The Administrative Agent shall not be obliged to (i)
take or refrain from taking any action or exercise or refrain from exercising
any right or discretion under the Credit Documents; or (ii) incur or subject
itself to any cost in connection with the Credit Documents, unless it is
first specifically indemnified or furnished with security by the Lenders, in
form and substance satisfactory to it (which may include further agreements
of indemnity or the deposit of funds).

                  (4) The Issuing Lender shall act on behalf of the Lenders
with respect to any Letters of Credit issued by it and the documents
associated therewith, and the Issuing Lender shall have all of the benefits
and immunities (i) provided to the Administrative Agent in this Article 10
with respect to any acts taken or omissions suffered by the Issuing Lender in
connection with Letters of Credit issued by it or proposed to be issued by it
and the applications and agreements for letters of credit pertaining to such
Letters of Credit as fully as if the term "Administrative Agent" as used in
this Article 10 and in the definition of "Agent-Related Person" included the
Issuing Lender with respect to such acts or omissions, and (ii) as
additionally provided herein with respect to the Issuing Lender.

                  (5) For the purposes of creating a SOLIDARITE ACTIVE
between each Lender taken individually, and the Administrative Agent in
accordance with Article 1541 of the Civil Code, the Borrower, each Guarantor
and each Lender (on its own behalf) acknowledge and agree with the
Administrative Agent that such Lender and the Administrative Agent are hereby
conferred the legal status of solidary creditors of the Borrower and each
Guarantor in respect of all amounts, liabilities and other obligations owed
by the Borrower and each Guarantor to each of them hereunder and under the
other Credit Documents (collectively, the "SOLIDARY CLAIM") and that,
accordingly, but subject (for the avoidance of doubt) to Article 1542 of the
Civil Code, the Borrower and each Guarantor is irrevocably bound towards each
of the Administrative Agent, as solidary creditor for itself and the said
Lender in respect of the entire Solidary Claim. As a result of the foregoing,
the parties hereto acknowledge that the Administrative Agent and each Lender,
shall at all times have a valid and effective right of action for the entire
Solidary Claim and that the Liens of the Security Documents shall accordingly
be granted to the Administrative Agent, for its own behalf and for the
benefit of the Lenders.

                  SECTION 10.02. NO LIABILITY. (1) Neither the Administrative
Agent nor any Agent-Related Person shall be liable to any Lender for any
action taken or omitted to be taken by it or them in connection with the
Credit Documents except for its or their own gross negligence or wilful
misconduct in connection with its duties expressly set forth herein. Without
limiting the generality of the foregoing, the Administrative Agent and each
Agent-Related Person (i) may treat any Lender as the payee of amounts
attributable to its Commitment unless and until the Administrative Agent
receives an agreement in the form contemplated in Section 12.08(5); (ii) may
consult with legal counsel (including legal counsel for the Borrower),
independent accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken by it in accordance with
their advice; (iii) makes no warranty or representation to any Lender and
shall not be responsible to any Lender for the form, substance, accuracy or
completeness of any Credit Document or any other documents or information
made available to the Lenders; (iv) has no duty to inspect the property or
assets (including books and records) of the Borrower or any other Person;



                                      71

(v) has no duty to ascertain or inquire as to the existence of a Default or
an Event of Default or the observance of any of the terms or conditions of
the Credit Documents, and shall not be deemed to have any knowledge of same
until it has received notice from a Lender or the Borrower describing such
Default or Event of Default and stating that such notice is a "Default
Notice"; (vi) is not responsible (a) to any Lender for the execution,
enforceability, genuineness, sufficiency or value of any of the Credit
Documents or (b) to the Borrower or any Guarantor on account of the failure
of any Lender to perform its obligations; (vii) shall be entitled to rely
upon any certificate, notice or other document (including any cable,
telegram, telex or fax), electronic mail, telephone message or conversation
believed by it to be genuine and correct and to have been signed or sent by
or on behalf of the proper person or persons; and (viii) shall incur no
liability by acting upon any notice, certificate or other instrument believed
by it to be genuine and signed or sent by the proper Person.

                  (2) The Administrative Agent shall not be required to keep
itself informed as to the performance or observance by the Borrower of this
Agreement or any other document referred to or provided for herein or therein
or to inspect the properties or books of the Borrower. Except (in the case of
the Administrative Agent) for notices, reports and other documents and
information expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall have no duty
or responsibility to provide any Lender with any credit or other information
concerning the affairs or financial condition of the Borrower which may come
to the attention of the Administrative Agent, except where provided to the
Administrative Agent for the Lenders, provided that such information does not
confer any advantage to the Administrative Agent as a Lender over the other
Lenders. Nothing in this Agreement shall oblige the Administrative Agent to
disclose any information relating to the Borrower if such disclosure would or
might, in the opinion of the Administrative Agent, constitute a breach of any
Laws or duty of secrecy or confidence.

                  (3) For purposes of determining compliance with the
conditions specified in SECTION 6.01, each Lender that has signed this
Agreement shall be deemed to have consented to, approved or accepted or to be
satisfied with, each document or other matter required thereunder to be
consented to or approved by or acceptable or satisfactory to a Lender unless
the Administrative Agent shall have received notice from such Lender prior to
the proposed Closing Date specifying its objection thereto.

                  SECTION 10.03. ACCOMMODATIONS BY ADMINISTRATIVE AGENT. The
Administrative Agent has the same rights and powers under this Agreement with
respect to its Commitment as any other Lender and may exercise such rights
and powers as though it were not the Administrative Agent. The term "LENDER"
or "LENDERS" shall, unless otherwise expressly indicated, include the
Administrative Agent in its individual capacity. The Administrative Agent and
its Affiliates may accept deposits from, lend money to, act as trustee under
indentures of, underwrite an issue of securities of and generally engage in
any kind of business with, the Borrower, any of its subsidiaries, Holdco or
any Person who may do business with or own securities of such Persons, all as
if it were not the Administrative Agent and without any duty to account to
the Lenders.

                  SECTION 10.04. HOLDING OF SECURITY; SHARING OF PAYMENTS,
ETC. (1) The Security shall be held by the Administrative Agent for the
rateable benefit of the Lenders in accordance with



                                      72

their respective terms, and any proceeds from any realization of the
Security, as well as all other amounts received by the Administrative Agent
for the account of the Lenders, shall be applied to the Accommodations
Outstanding and other amounts payable to the Lenders under the Credit
Documents to each Lender rateably (whether such Security is held in the name
of the Administrative Agent or in the name of any one or more of the Lenders
and without regard to any priority to which any Lender may otherwise be
entitled under applicable Law), and in connection with any application of
proceeds of realization of Security as aforesaid, to the lender providing the
Overdraft Facility as well.

                  (2) Each Lender agrees with the other Lenders that it will
not, without the prior consent of the other Lenders, take or obtain any Lien
on any properties or assets of the Borrower or any of its subsidiaries to
secure the obligations of the Borrower under this Agreement, except for the
benefit of all Lenders or as may otherwise be required by applicable Law.

                  (3) If any Lender obtains any payment (whether voluntary,
involuntary or through the exercise of any right of set-off or realization of
Security) on account of Accommodations made by it (other than amounts paid
pursuant to Section 12.06) in excess of its rateable share of payments
obtained by all the Lenders, the Lender shall account to and pay over to the
other Lenders their rateable share and shall, upon request, immediately
purchase from the other Lenders such participations in the Accommodations
made by the other Lenders as shall be necessary to cause the purchasing
Lender to share the excess payment rateably with the other Lenders. If all or
any portion of the excess payment is recovered from the purchasing Lender,
the purchase price shall be rescinded and each Lender shall repay to the
purchasing Lender the purchase price to the extent of the recovery together
with an amount equal to the Lender's rateable share (according to the
proportion that the amount the Lender's required repayment bears to the total
amount recovered from the purchasing Lender) of any interest or other amount
paid by the purchasing Lender in respect of the total amount recovered. The
Lender purchasing a participation from another Lender pursuant to this
Section 10.04 may, to the fullest extent permitted by law, exercise all its
rights of payment (including any right of set-off) with respect to such
participation as fully as if the Lender were a direct creditor of the
Borrower in the amount of the participation and the Borrower expressly
acknowledges the creation of such right.

                  (4) On request by, and at the expense of, the Borrower and
provided no Default has occurred and is continuing and no Event of Default
has occurred and not been waived, the Administrative Agent may, on behalf of
the Lenders,

         (a) discharge and release the Security to the extent required
         (i) to permit a Disposition permitted under this Agreement;
         (ii) upon termination of all Commitments and the payment in
         full of all Accommodations Outstanding and all other amounts
         owed to the Administrative Agents, the Lenders hereunder
         (including for greater certainty the providers of the Hedging
         Agreements) and the provider of the Overdraft Facility; or
         (iii) if approved, authorized or ratified by all of the
         Lenders (including for greater certainty the providers of
         the Hedging Agreements) and the provider of the Overdraft
         Facility;



                                      73

         (b) to subordinate any Security held by the Administrative
         Agent on property of the Loan Parties to the holder of a
         Purchase Money Mortgage where same is permitted hereunder;
         and
         (c) to release any Guarantor from its guarantee provided in
         connection with this Credit Agreement where such Guarantor
         ceases to be a Guarantor as permitted hereunder.

                  SECTION 10.05. LENDER CREDIT DECISIONS. Each Lender
acknowledges that it has, independently and without reliance upon any
Agent-Related Person, made its own credit analysis and decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and
without reliance upon any Agent and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement.

                  SECTION 10.06 DELEGATION. The Administrative Agent may
execute any of its duties under this Agreement or any other Credit Document
by or through agents, employees or attorneys-in-fact and shall be entitled to
advice of counsel and other consultants or experts concerning all matters
pertaining to such duties. The Administrative Agent shall not be responsible
for the negligence or misconduct of any agent or attorney-in-fact that it
selects in the absence of gross negligence or willful misconduct.

                  SECTION 10.07. INDEMNIFICATION. Each Lender shall indemnify
and save the Administrative Agent and each Agent-Related Person harmless (to
the extent not reimbursed by the Borrower or another Loan Party) rateably
from any claim or loss suffered by, imposed upon or asserted against the
Administrative Agent as a result of, or arising out of, the Credit Documents
or any action taken or omitted by the Administrative Agent under the Credit
Documents provided that no Lender shall be liable for any part of such loss
resulting from the gross negligence or wilful misconduct of the
Administrative Agent in its capacity as agent. Without limiting the
foregoing, each Lender shall reimburse the Administrative Agent upon demand
for its rateable share of any out-of-pocket expenses incurred by the
Administrative Agent in connection with the preparation, execution,
administration or enforcement of, or legal advice in respect of rights or
responsibilities under, the Credit Documents (to the extent not reimbursed by
the Borrower or another Loan Party).

                  SECTION 10.08. LIABILITY OF THE LENDERS INTER SE. Each of
the Lenders agrees with each of the other Lenders that, except as otherwise
expressly provided in this Agreement, none of the Lenders has or shall have
any duty or obligation, or shall in any way be liable to any of the other
Lenders in respect of the Credit Documents or any action taken or omitted to
be taken in connection with them.

                  SECTION 10.09. SUCCESSOR ADMINISTRATIVE AGENT. The
Administrative Agent may (i) resign from its position at any time by giving
written notice to the Lenders and the Borrower; or (ii) be removed at any
time for cause by the Majority Lenders, such resignation or removal to be
effective upon the appointment of a successor Administrative Agent. Upon
notice of any resignation or removal, the Majority Lenders have the right to
appoint a successor Administrative Agent (and, if the Issuing Lender is also
the Administrative Agent, the Majority Lenders shall also



                                      74

appoint a new Issuing Lender) who (at any time that no Event of Default has
occurred and not been waived) shall be acceptable to the Borrower, acting
reasonably. If no successor Administrative Agent (and Issuing Lender, if
applicable) is appointed or has accepted the appointment within thirty days
after the retiring Administrative Agent's notice of resignation or removal,
as the case may be, then the retiring Administrative Agent may, on behalf of
the Lenders, appoint a successor Administrative Agent, which shall be a
Lender, but such resignation shall not be effective until a successor
Administrative Agent (and Issuing Lender, if applicable) has been appointed.
Upon the acceptance of any such appointment by a successor Administrative
Agent (and Issuing Lender, if applicable), the successor shall succeed to and
become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent (and Issuing Lender, if applicable) and the
retiring Administrative Agent (and Issuing Lender, if applicable) shall be
discharged from its duties and obligations under this Agreement. If no
successor Administrative Agent (and Issuing Lender, if applicable) has
accepted appointment as Administrative Agent (and Issuing Lender, if
applicable) by the date which is 30 days following a retiring Administrative
Agent's notice of resignation, the retiring Administrative Agent's
resignation shall nevertheless thereupon become effective and the Lenders
shall perform all of the duties of the Administrative Agent (and Issuing
Lender, if applicable) hereunder until such time, if any, as the Majority
Lenders appoint a successor agent as provided for above. After any retiring
Administrative Agent's (and Issuing Lender, if applicable) resignation or
removal, as the case may be, the provisions of this Article 10 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent (and Issuing Lender, if applicable).

                  SECTION 10.10. ADMINISTRATIVE AGENT MAY FILE PROOFS OF
CLAIM. In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Accommodations Outstanding
shall then be due and payable as herein expressed or by declaration or
otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise

         (a) to file and prove a claim for the whole amount of the principal
and interest owing and unpaid in respect of the Accommodations Outstanding
and all other obligations that are owing and unpaid and to file such other
documents as may be necessary or advisable in order to have the claims of the
Lenders and the Administrative Agent (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Lenders and the
Administrative Agent and their respective agents and counsel and all other
amounts due the Lenders and the Administrative Agent hereunder or under the
Hedging Agreements; and

          (b) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized
by each Lender to make such payments to the Administrative Agent and, in the
event that the Administrative Agent shall consent to the making of such
payments directly to the Lenders, to pay to the Administrative Agent any
amount due for



                                      75

the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due
the Administrative Agent hereunder.

Nothing contained herein shall be deemed to authorize the Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender
any plan of reorganization, arrangement, adjustment or composition affecting
the obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any
such proceeding.

                  SECTION 10.11. REPLACEMENT OF SCHEDULE II REFERENCE
LENDERS. If a Schedule II Reference Lender assigns, subject to the provisions
of Section 12.08, all of its rights hereunder or otherwise ceases to be a
Lender, or if a Schedule II Reference Lender gives notice of its intention to
cease being a Schedule II Reference Lender, or if in the opinion of the
Administrative Agent, a Schedule II Reference Lender is no longer capable of
exercising its functions as a Schedule II Reference Lender, the
Administrative Agent shall, with the prior written consent of the Borrower if
prior to an Event of Default which has not been waived, appoint another
Lender designated as a Schedule II bank under the BANK ACT (Canada) (with the
letters' consent) to act as a Schedule II Reference Lender in replacement
thereof.

                  SECTION 10.12. IRREVOCABLE POWER OF ATTORNEY (FONDE DE
POUVOIR). Without limiting the powers of the Administrative Agent hereunder
or under the Credit Documents and to the extent applicable, each of the
Lenders hereby acknowledges that the Administrative Agent shall, for the
purposes of holding any Security granted under the Security Documents for use
in the Province of Quebec, to secure payment of the Debentures, be the holder
of an irrevocable power of attorney (FONDE DE POUVOIR) (within the meaning of
Article 2692 of the CIVIL CODE OF QUEBEC) for all present and future Lenders
and in particular for all present and future holders of the Debentures. Each
of the Lenders hereby constitutes, to the extent necessary, the
Administrative Agent (or, if desired, a designated collateral agent) as the
holder of such irrevocable power of attorney in order to hold security
granted under such hypothecs to secure the Debentures. Each Assignee shall be
deemed to have confirmed and ratified the constitution of the Administrative
Agent as the holder of such irrevocable power of attorney by execution of the
relevant Transfer Agreement. Notwithstanding the provisions of Section 32 of
the AN ACT RESPECTING THE SPECIAL POWERS OF LEGAL PERSONS (Quebec), the
Borrower, the Guarantors and the Lenders irrevocably agree that the
Administrative Agent may acquire and be the holder of a Debenture. By
executing a Debenture, the issuer of the Debenture shall be deemed to have
acknowledged that the Debenture constitutes a title of indebtedness, as such
term is used in Article 2692 of the CIVIL CODE OF QUEBEC.

                                  ARTICLE 11
                             CURRENCY AND EXCHANGE

                  SECTION 11.1. RULES OF CONVERSION. If for the purpose of
obtaining judgment in any court or for any other purpose hereunder, it is
necessary to convert an amount due, advanced or to be advanced hereunder from
the currency in which it is due (the "FIRST CURRENCY") into



                                      76


another currency (the "SECOND CURRENCY") the rate of exchange used shall be
that at which, in accordance with normal banking procedures, the
Administrative Agent could purchase, in the Canadian money market or the
Canadian exchange market, as the case may be, the First Currency with the
Second Currency on the date on which the judgment is rendered, the sum is
payable or advanced or to be advanced, as the case may be. The Borrower
agrees that its obligations in respect of any First Currency due from it to
the Lenders in accordance with the provisions hereof shall, notwithstanding
any judgment rendered or payment made in the Second Currency, be discharged
by a payment made to the Administrative Agent on account thereof in the
Second Currency only to the extent that, on the Business Day following
receipt of such payment in the Second Currency, the Administrative Agent may,
in accordance with normal banking procedures, purchase on the Canadian money
market or the Canadian foreign exchange market, as the case may be, the First
Currency with the amount of the Second Currency so paid or which a judgment
rendered payable; and if the amount of the First Currency which may be so
purchased is less than the amount originally due in the First Currency, the
Borrower agrees as a separate and independent obligation and notwithstanding
any such payment or judgment to indemnify the Lenders against such deficiency.

                  SECTION 11.2. DETERMINATION OF AN EQUIVALENT CURRENCY. If,
in their discretion, the Lenders or the Administrative Agent chooses or,
pursuant to the terms of this Agreement, are obliged to choose the equivalent
in Canadian Dollars of any securities or amounts expressed in US Dollars or
the equivalent in US Dollars of any securities or amounts expressed in
Canadian Dollars, the Administrative Agent, in accordance with the conversion
rules as stipulated in Section 11.1, on the date indicated in the Borrowing
Notice as the date of a request for an Advance, and at any other time which
in the opinion of the Lenders is desirable; may, using the spot rate of the
Administrative Agent or an Affiliate on such date, determine the equivalent
in Canadian Dollars or in US Dollars, as the case may be, of any security or
amount expressed in the other currency pursuant to the terms hereof.
Immediately following such determination, the Administrative Agent shall
inform the Borrower of the conclusion which the Lenders have reached.

                                  ARTICLE 12

                                 MISCELLANEOUS

                  SECTION 12.01. AMENDMENT. (1) Subject to subsections (2)
and (3), no amendment or waiver of any provision of any of the Credit
Documents, nor consent to any departure by the Borrower or any other Person
from such provisions, is effective unless in writing and approved by the
Majority Lenders. Any amendment, waiver or consent is effective only in the
specific instance and for the specific purpose for which it was given.

                  (2) Only written amendments, waivers or consents signed by
all the Lenders shall (i) increase a Lender's Commitment or subject any
Lender to any additional obligation, or increase the aggregate Commitments
hereunder; (ii) reduce the principal amount of, or interest on, directly or
indirectly, any Accommodation Outstanding or any Fees; (iii) postpone any
date fixed for any payment of principal of, or interest on, any Accommodation
Outstanding or any Fees, or



                                      77

otherwise postpone or extend any maturity date, including in relation to a
Mandatory Prepayment; (iv) change (y) the percentage of the Commitments, or
(z) the number or percentage of Lenders required for the Lenders, or any of
them, or the Administrative Agent to take any action; (v) permit any
amendment to or termination of any of the Security Documents or release any
of the collateral subject thereto (except as otherwise permitted in Section
10.04(4)); (vi) permit the release of any Guarantor or the amendment of any
guarantee provided by any Guarantor (except as otherwise permitted by Section
10.4(4)); (vii) change the definition of Majority Lenders; (viii) modify or
waive any condition precedent provided for in Article 6; (ix) modify the
application of payments contemplated by Section 2.09 or 9.05, or the rateable
application of same in accordance with the provisions of Section 10.04; or
(ix) amend this Section 12.01(2).

                  (3) Only written amendments, waivers or consents signed by
the Administrative Agent in addition to the Majority Lenders, shall affect
the rights or duties of the Administrative Agent under the Credit Documents.

                  SECTION 12.02. WAIVER. (1) No failure on the part of any
Lender or the Administrative Agent to exercise, and no delay in exercising,
any right under any of the Credit Documents shall operate as a waiver of such
right; nor shall any single or partial exercise of any right under any of the
Credit Documents preclude any other or further exercise of such right or the
exercise of any other right.

                  (2) Except as otherwise expressly provided in this
Agreement, the covenants, representations and warranties shall not merge on
and shall survive the initial Accommodation and, notwithstanding such initial
Accommodation or any investigation made by or on behalf of any party, shall
continue in full force and effect. The closing of this transaction shall not
prejudice any right of one party against any other party in respect of
anything done or omitted under this Agreement or in respect of any right to
damages or other remedies.

                  SECTION 12.03. EVIDENCE OF DEBT AND ACCOMMODATION NOTICES.
(1) The indebtedness of the Borrower resulting from Accommodations under the
Credit Facilities shall be evidenced by the records of the Lenders (or the
Administrative Agent acting on behalf of the Lenders) which shall constitute
PRIMA FACIE evidence of such indebtedness.

                  (2) Prior to the receipt of any Accommodation Notice, the
Administrative Agent may act upon the basis of a notice by telephone
(containing the same information as required to be contained in such
Accommodation Notice) believed by it in good faith to be from an authorized
person representing the Borrower. In the event of a conflict between the
Administrative Agent's record of any Accommodation and the Accommodation
Notice, the Administrative Agent's record shall prevail, absent manifest
error.

         SECTION 12.04. NOTICES, ETC. Any notice, direction or other
communication required or permitted to be given under this Agreement shall,
except as otherwise permitted, be in writing and given by delivering it or
sending it by telecopy or other similar form of recorded communication
addressed, if to the Borrower, to it at:  Sun Media Corporation, 333 King
Street East, Toronto (Ontario), M5A 3X5, Canada, Attention: Controller,
Telephone:  (416) 947-2080,



                                      78

Fax:  (416) 947-3119, with a copy to: Treasurer, Quebecor Media Inc.,
Telephone: (514) 380-1912, Fax: (514) 380-1983; if to the Administrative
Agent, (I) for the purposes of Accommodations and Repayments under (A)
Facility A, to it at: 200 Front Street West, Suite 2700, Toronto, Ontario,
M5V 3L2 , Attention: Domingo.Braganza, Credit Services, Telephone:  (416)
349-5464, Fax:  (416) 349-4282/4283, E-mail:
Domingo.Braganza@bankofamerica.com; Alternate - Clara McGibbon, 416-349-5484,
E-mail: Clara.McGibbon@bankofamerica.com; and (B) Term Facility B, to it at:
Bank of America, N. A., Agency Services, 1850 Gateway Blvd., 5th Floor, MC:
CA4-706-05-09, Concord, CA 94520, Phone: (925) 675-8373, Fax: (925) 969-2414,
E-mail: kristine.l.kelleher@bankofamerica.com; and (II), for all other
purposes, to it at: 555 South Flower St., 17th floor, CA9-706-17-54 in the
City of Los Angeles, California, 90071, Attention: David Price,
Vice-President, Telephone: (213) 345-1300, Fax: (415) 503-5011, Email:
david.price@bankofamerica.com; and, if to the Lenders, at the addresses shown
on the signature pages.  Any communication shall be deemed to have been
validly and effectively given (i) if personally delivered, on the date of
such delivery if such date is a Business Day and such delivery was made prior
to 4:00 p.m. (Toronto time); (ii) if transmitted by facsimile or similar
means of recorded communication on the Business Day following the date of
transmission.  Any party may change its address for service from time to time
by notice given in accordance with the foregoing and any subsequent notice
shall be sent to the party at its changed address.

                  SECTION 12.05. CONFIDENTIALITY. Each Lender agrees to use
reasonable efforts to ensure that financial statements or other information
relating to the Borrower which may be delivered to it pursuant to this
Agreement and which are not publicly filed or otherwise made available to the
public generally (and which are not independently known to the Lender) will,
to the extent permitted by Law, be treated confidentially by the Lender and
will not, except with the consent of the Borrower, be distributed or
otherwise made available by the Lender to any Person other than its
directors, officers, employees, authorized agents, counsel or other
representatives (provided the other representatives have agreed or are under
a duty to keep all information confidential) required, in the reasonable
opinion of the Lender, to have such information. Each Lender is authorized to
deliver a copy of any financial statement or any other information which may
be delivered to it pursuant to this Agreement, to (i) any actual or potential
Participant or Assignee; (ii) any Governmental Entity having jurisdiction
over the Lender in order to comply with any applicable laws; (iii) any
Affiliate of the Lender required, in the reasonable opinion of the Lender, to
have such information; and (iv) any direct or indirect contractual
counterparty in any swap, hedge or similar agreement (or to any such
contractual counterparty's professional advisor), so long as such contractual
counterparty (or such professional advisor) agrees to be bound by the
provisions of this Section 12.05.

                  SECTION 12.06. COSTS, EXPENSES AND INDEMNITY. (1) The
Borrower shall, whether or not the transactions contemplated in this
Agreement are completed, indemnify and hold each of the Lenders and each
Agent-Related Person and each of their respective officers, directors,
employees, agents, trustees and advisors (each an "INDEMNIFIED PERSON")
harmless from, and shall pay to such Indemnified Person on demand any amounts
required to compensate the Indemnified Person for, any claim or loss suffered
by, imposed on, or asserted against, the Indemnified Person as a result of,
connected with or arising out of (i) the preparation, execution and delivery
of the Commitment Letter, Term Sheet and Fee Letter, (ii) the preparation,
execution and delivery of,



                                      79

preservation of rights under, enforcement of, or
refinancing, renegotiation or restructuring of, the Credit Documents and any
related amendment, waiver or consent; (iii) any advice of counsel as to the
rights and duties of the Administrative Agent and the Lenders with respect to
the administration of the Credit Facilities, the Credit Documents or any
transaction contemplated under the Credit Documents, including any
interpretation issues; (iv) a default (whether or not constituting a Default
or an Event of Default) by the Borrower; (v) any proceedings brought against
the Indemnified Person due to its entering into any of the Credit Documents
and performing its obligations under the Credit Documents except to the
extent that it shall be determined in a final, non-appealable judgment by a
court of competent jurisdiction that such losses, claims, damages,
liabilities or expenses resulted primarily from the gross negligence or
wilful misconduct of the Indemnified Person; and (vi) the presence on or
under or the discharge or likely discharge of Hazardous Substances from any
of the properties used by the Borrower or any of its subsidiaries, or the
breach of any Environmental Law by the Borrower or any of its subsidiaries or
by any mortgagor, owner, or lessee of such properties. No Indemnified Person
shall be liable for any damages arising from the use by others of information
provided by or on behalf of the Borrower and obtained through the Internet,
Intralinks or other similar information transmission systems in connection
with the Credit Facilities except to the extent that, as to any Indemnified
Person, it shall be determined by a final, non-appealable judgment by a court
of competent jurisdiction that such damages resulted primarily from gross
negligence or willful misconduct of such Indemnified Person. The Borrower
agrees that no Indemnified Person shall have any liability (whether direct or
indirect, in contract or tort or otherwise) to any Person, including the
Borrower, any of its subsidiaries and Affiliates or their respective security
holders or creditors arising out of or in connection with any aspect of this
Credit Agreement or the Credit Facilities, except for direct, as opposed to
consequential, damages determined in a final, non-appealable judgment by a
court of competent jurisdiction to have resulted primarily from the gross
negligence or willful misconduct of such Indemnified Person.

                  (2) If, with respect to any Lender, (i) any change in Law
of general application, or any change in the interpretation or application of
such Law occurring or becoming effective after the Closing Date; or (ii)
compliance by the Lender with any direction, request or requirement (whether
or not having the force of law) of any Governmental Entity made or becoming
effective after the Closing Date, has the effect of causing any loss to the
Lender or reducing the Lender's rate of return by (w) increasing the cost to
the Lender of performing its obligations under this Agreement or in respect
of any Accommodations Outstanding (including the costs of maintaining any
capital, reserve or special deposit requirements (other than a reduction
resulting from a higher rate or from a change in the calculation of income or
capital tax relating to the Lender's income or capital in general)), (x)
requiring the Lender to maintain or allocate any capital or additional
capital or affecting its allocation of capital in respect of its obligations
under this Agreement or in respect of any Accommodations Outstanding, (y)
reducing any amount payable to the Lender under this Agreement or in respect
of any Accommodations Outstanding by any material amount, (z) causing the
Lender to make any payment or to forego any return on, or calculated by
reference to, any amount received or receivable by the Lender under this
Agreement or in respect of any Accommodations Outstanding, then, subject to
Section 12.06(3), the Lender may give notice to the Borrower specifying, with
reasonable detail, the nature of the event giving rise to the loss and the
Borrower may either: (A) on demand, pay such amounts as the Lender specifies
is necessary to compensate it for any such loss, or (B) provided no loss has
yet been suffered by the Lender or the



                                      80

Borrower has paid the compensating amount to the Lender, repay the
Accommodations Outstanding to such Lender and terminate the Lender's
Commitments all without affecting the Commitments or Accommodations
Outstanding of any other Lender. A certificate as to the amount of any such
loss submitted in good faith by a Lender to the Borrower shall be conclusive
and binding for all purposes, absent manifest error.

                  (3) The Borrower shall not be liable to compensate a Lender
for any costs, reduction, payment or foregone return if such compensation is
not being claimed as a general practice by such Lender from customers of such
Lender who by agreement are liable to pay such or similar compensation. In
determining the amount of compensation payable by the Borrower under Section
12.06(2), such Lender shall use all reasonable efforts to minimize the
compensation payable by the Borrower including using all reasonable efforts
to obtain refunds or credits in the ordinary course of its business, and any
compensation paid by the Borrower which is later determined not to have been
properly payable or in respect of which a refund, credit or compensation has
been received shall forthwith be reimbursed by such Lender to the Borrower.

                  (4) The Borrower shall pay to each Lender on demand any
amounts required to compensate the Lender for any loss suffered or incurred
by it as a result of (i) any payment being made in respect of a BA Instrument
or Libor Advance other than on the maturity applicable to it; (ii) the
failure of the Borrower to give any notice in the manner and at the times
required by this Agreement; (iii) the failure of the Borrower to effect an
Accommodation in the manner and at the time specified in any Accommodation
Notice; or (iv) the failure of the Borrower to make a payment or a mandatory
repayment in the manner and at the time specified in this Agreement. A
certificate as to the amount of any loss submitted in good faith by a Lender
to the Borrower shall be conclusive and binding for all purposes, absent
manifest error.

                  (5) The provisions of this Section 12.06 shall survive the
termination of this Agreement and the repayment of all Accommodations
Outstanding. The Borrower acknowledges that neither their obligation to
indemnify nor any actual indemnification by them of any Lender, the
Administrative Agent or any other Indemnified Person in respect of such
Person's losses for the legal fees and expenses shall in any way affect the
confidentiality or privilege relating to any information communicated by such
Person to its counsel.

                  SECTION 12.07. TAXES. (1) The Borrower agrees to
immediately pay any present or future stamp or documentary taxes or any other
excise or property taxes, charges, financial institutions duties, debits or
similar levies (all such taxes, charges, duties and levies being referred to
as "TAXES") which arise from any payment made by the Borrower under any of
the Credit Documents or from the execution, delivery or registration of, or
otherwise with respect to, any of the Credit Documents. If any Taxes are
required to be withheld from any payment hereunder, the Borrower shall (a)
increase the amount of such payment so that the Lenders will receive a net
amount (after deduction and withholding of all Taxes) equal to the amount
otherwise due hereunder; (b) pay such Taxes to the appropriate taxing
authority for the account of the relevant Lenders and (c) as promptly as
possible thereafter, send the Administrative Agent and the Lenders an
original receipt showing payment thereof, together with such additional
documentary evidence as the Lenders may from time to time reasonably require.



                                       81

                  (2) The Borrower shall indemnify the Lenders and the
Administrative Agent for the full amount of Taxes (including, without
limitation, any Taxes imposed by any jurisdiction on amounts payable by the
Borrower under this Section 12.07) paid by the Lenders or the Administrative
Agent and any liability (including penalties, interest and expenses) arising
from or with respect to such Taxes, whether or not they were correctly or
legally asserted, excluding, in the case of any Lender, taxes imposed on its
net income or capital taxes or receipts and franchise taxes. Payment under
this indemnification shall be made within 30 days from the date the
Administrative Agent or the relevant Lender, as the case may be, make written
demand for it. A certificate as to the amount of such Taxes submitted to the
Borrower by the Administrative Agent or the relevant Lender shall be
conclusive evidence, absent manifest error, of the amount due from the
Borrower to the Administrative Agent or the Lenders, as the case may be.

                  (3) The Borrower shall furnish to the Administrative Agent
and the Lenders the original or a certified copy of a receipt evidencing
payment of Taxes made by the Borrower within 30 days after the date of any
payment of Taxes.

                  (4) The  provisions of this Section 12.07 shall  survive
the  termination  of the Agreement and the repayment of all Accommodations
Outstanding.

                  SECTION 12.08. SUCCESSORS AND ASSIGNS. (1) This Agreement
shall become effective when executed by the Borrower, the Administrative
Agent and each Lender and after that time shall be binding upon and enure to
the benefit of the Borrower, the Lenders and the Administrative Agent and
their respective successors and permitted assigns.

                  (2) The Borrower shall not have the right to assign its
rights or obligations under this Agreement or any interest in this Agreement
without the prior consent of all the Lenders, which consent may be
arbitrarily withheld.

                  (3) A Lender may (i) grant participations, without notice
to or consent of the Borrower or the Administrative Agent, in all or any part
of its interest in the Credit Facilities to one or more Persons (each a
"PARTICIPANT"), or (ii) upon prior written notice to the Administrative Agent
and the Borrower, assign all or any part of its interest in the Credit
Facilities to one or more Persons (each an "ASSIGNEE"), provided that in the
case of any interest which is a partial interest (other than after the
occurrence of a Default which is continuing or an Event of Default which has
not been waived, in which case no minimums will apply), such partial interest
is not less than $5,000,000 under Facility A or US$1,000,000 under Term
Facility B (or such lesser amount as agreed to by the Borrower and the
Administrative Agent). An assignment shall require (A) the consent of the
Borrower, which shall not be unreasonably withheld or delayed, prior to the
occurrence of a Default which is continuing or an Event of Default which has
not been waived, and thereafter shall not require any such consent, and (B)
the consent of the Administrative Agent (and, in the case of assignments
under Facility A, the Issuing Lender and the Swingline Lender), which shall
not be unreasonably withheld or delayed; provided that the Borrower's consent
shall not be required for an assignment to any of the following Persons: (A)
a Lender; (b) an Affiliate of a Lender; or (c) an Approved Fund, which shall
not be the Borrower or any of the Borrower's


                                       82

Affiliates or subsidiaries. A Lender granting a participation shall, unless
otherwise expressly provided in this Agreement, act on behalf of all of its
Participants in all dealings with the Borrower in respect of the Credit
Facilities and no Participant shall have any voting or consent rights with
respect to any matter requiring the Lenders' consent. In the case of an
assignment, the Assignee shall have the same rights and benefits and be
subject to the same limitations under the Credit Documents as it would have
if it was a Lender, provided that no Assignee or Participant shall be
entitled to receive any greater payment, on a cumulative basis, pursuant to
Section 12.06 or Section 12.07 than the Lender which granted the assignment
or participation would have been entitled to receive.

                  (4) The Borrower shall provide such certificates,
acknowledgments and further assurances in respect of this Agreement and the
Credit Facilities as such Lender may reasonably require in connection with
any participation or assignment pursuant to this Section 12.08.

                  (5) In order to effect an assignment in accordance with
this Section 12.08, a Lender shall deliver to the Borrower an assignment and
assumption agreement substantially in the form of Schedule 6 by which an
Assignee of the Lender assumes the obligations and agrees to be bound by all
the terms and conditions of this Agreement, all as if the Assignee had been
an original party. Upon receipt by the Administrative Agent from the
assigning Lender of a processing fee of US$3,500 and the assignment and
assumption agreement, the assigning Lender and the Borrower shall be released
from their respective obligations under this Agreement (to the extent of such
assignment and assumption) and shall have no liability or obligations to each
other to such extent, except in respect of matters arising prior to the
assignment.

                  (6) Any assignment or grant of participation pursuant to
this Section 12.08 will not constitute a repayment by the Borrower to the
assigning or granting Lender of any Accommodation, nor a new Accommodation to
the Borrower by such Lender or by the Assignee or Participant, as the case
may be, and the parties acknowledge that the Borrower's obligations with
respect to any such Accommodations will continue and will not constitute new
obligations.

                  (7) The amounts payable by the Borrower under this
Agreement shall not increase on account of withholding taxes as a result of
any such assignment or transfer to an Assignee of a Facility A Lender which
is a non-resident of Canada as defined in the INCOME TAX ACT (Canada);
provided that an assignment which occurs after the occurrence of an Event of
Default which has not been waived shall not be subject to this provision.

                  (8) Any Lender (a "GRANTING LENDER") may grant to a special
purpose funding vehicle (an "SPV"), identified as such from time to time by
the Granting Lender to the Agent and the Borrower, the option to provide to
the Borrower all or any part of an Advance that such Granting Lender would
otherwise be required to make hereunder; provided that (a) nothing herein
shall constitute a commitment by any SPV to make any Advance, and (b) if an
SPV does not make such Advance, the Granting Lender shall remain liable to do
so. Any Advance by an SPV shall be made using the Commitment of the Granting
Lender as if the Advance in question had been made by such Granting Lender.
Each party hereto agrees that no SPV shall be liable for any indemnity or
other payment hereunder, all of which liability shall remain with the
Granting Lender. Accordingly,


                                       83

each party further agrees (which agreement will survive the termination
hereof) that it shall not institute any insolvency or other proceeding
against the SPV until a date that is not less than one year and one day
following the repayment of all of such SPV's commercial paper and other
senior Indebtedness. In addition, any SPV may (a) assign all or any portion
of its interests in any Loans (i) with notice to, but without the consent of
the Borrower or the Agent, and without paying any fees therefor, to the
Granting Lender or (ii) to any financial institutions, with the consent of
the Borrower and the Agent providing liquidity and/or credit support to or
for the account of such SPV to support the funding and maintenance of
Advances; and (b) disclose on a confidential basis any non-public information
relating to the Loans to any rating agency, commercial paper dealer or
provider of any surety, guarantee or credit or liquidity enhancement to such
SPV.

                           (9) The Administrative  Agent shall maintain at
one of its offices a copy of each Assignment  Agreement delivered to it and a
register for the recordation of the names and addresses of the Lenders, and
the Commitments of, each Lender pursuant to the terms hereof from time to
time (the "REGISTER"). The entries in the Register shall be conclusive, and
the Borrower, the Administrative Agent, the Issuing Lender and the Lenders
may treat each Person whose name is recorded in the Register pursuant to the
terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by the Borrower, the Issuing Lender and any Lender, at any
reasonable time and from time to time upon reasonable prior notice. No
assignment shall be effective unless recorded in the Register.

                  SECTION 12.09. FACILITY A LENDER BECOMING NON-RESIDENT. If
a Facility A Lender becomes a non-resident of Canada as defined in the INCOME
TAX ACT (Canada), it shall promptly notify the Administrative Agent and the
Borrower, and if the Borrower unknowingly made payments to such Facility A
Lender that should have been subject to withholding taxes prior to such
notice, such Facility A Lender shall repay the amount that should have been
so withheld to the Borrower to be paid to the appropriate taxation authority.
Following such notice, the Facility A Lender in question shall have one of
the following options in connection with its Facility A Commitment: (a) to
permit the Borrower to deduct and pay the applicable withholding tax to the
appropriate taxation authority for so long as it is such a non-resident; or
(b) to require that the Borrower replace it as a Facility A Lender within 15
Business Days from such notice, failing which its Facility A Commitment will
be cancelled, and the Facility A Commitment hereunder will be permanently
reduced by an equal amount.

                  SECTION 12.10. RIGHT OF SET-OFF. Upon the occurrence of any
Event of Default, each Lender is authorized at any time and from time to
time, to the fullest extent permitted by law (including general principles of
common law), to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness
at any time owing by it to or for the credit or the account of the Loan
Parties against any and all of the obligations of the Borrower under any of
the Credit Documents, irrespective of whether or not the Lender has made
demand under any of the Credit Documents and although such obligations may be
unmatured or contingent. If an obligation is unascertained, the Lender may,
in good faith, estimate the obligation and exercise its right of set-off in
respect of the estimate, subject to providing the Borrower with an accounting
when the obligation is finally determined. Each Lender shall


                                       84

promptly notify the Borrower after any set-off and application is made by it,
provided that the failure to give notice shall not affect the validity of the
set-off and application. The rights of the Lenders under this Section 12.10
are in addition to other rights and remedies (including all other rights of
set-off) which the Lenders may have.

                  SECTION 12.11. ACCOMMODATIONS BY LENDERS. The failure of
any Lender to make an Accommodation shall not relieve any other Lender of its
obligations in connection with such Accommodation, but no Lender is
responsible for any other Lender's failure in respect of an Accommodation.
Unless the Administrative Agent receives notice from a Lender prior to the
date of any Accommodation that the Lender will not make its rateable portion
of the Accommodation available to the Administrative Agent, the
Administrative Agent may assume that the Lender has made its portion so
available on the date of the Accommodation and may, in reliance upon such
assumption, make a corresponding amount available to the Borrower. If the
Lender has not made its rateable portion available to the Administrative
Agent, the Lender shall pay the corresponding amount to the Administrative
Agent immediately upon demand. If the Lender pays the corresponding amount to
the Administrative Agent, the amount so paid shall constitute the Lender's
part of the Accommodation for purposes of this Agreement. If the Lender does
not pay the amount to the Administrative Agent immediately upon demand and
such amount has been made available to the Borrower, the Borrower shall pay
the corresponding amount to the Administrative Agent immediately upon demand
and any amount received and so reimbursed would not and will not constitute
an Accommodation. The Administrative Agent shall also be entitled to recover
from the Lender or the Borrower, as the case may be, interest on the
corresponding amount, for each day from the date the amount was made
available to the Borrower until the date it is repaid to the Administrative
Agent, at a rate per annum equal to the Administrative Agent's cost of funds.

                  SECTION 12.12. RATEABLE PAYMENTS. Unless the Administrative
Agent receives notice from the Borrower prior to the date on which any
payment is due to the Lenders that the Borrower will not make the payment in
full, the Administrative Agent may assume that the Borrower has made the
payment in full on that date and may, in reliance upon that assumption,
distribute to each Lender on the due date an amount equal to the amount then
due to the Lender. If the Borrower has not made the payment in full, each
Lender shall repay to the Administrative Agent immediately upon demand the
amount distributed to it together with interest for each day from the date
such amount was distributed to the Lender until the date the Lender repays it
to the Administrative Agent, at a rate per annum equal to the Administrative
Agent's cost of funds.

                  SECTION 12.13. INTEREST ON ACCOUNTS. Except as may be
expressly provided otherwise in this Agreement, all amounts owed by the
Borrower to the Administrative Agent and to any of the Lenders, which are not
paid when due (whether at stated maturity, on demand, by acceleration or
otherwise) shall (to the extent permitted by Law) bear interest (both before
and after default and judgment), from the date on which such amount is due
until such amount is paid in full, payable on demand, at a rate per annum
equal at all times to the sum of the Canadian Prime Rate in effect from time
to time, the Applicable Margin and 2%.

                  SECTION 12.14. GOVERNING LAW. This Agreement shall be
governed by and interpreted and enforced in accordance with the laws of the
Province of Ontario and the laws of

                                       85

Canada applicable therein; provided that the provisions of Section 10.12
shall be subject to the laws of the Province of Quebec and the laws of Canada
applicable therein.

                  SECTION 12.15. CONSENT TO JURISDICTION. The Borrower and
each Lender and each Agent hereby irrevocably submits to the jurisdiction of
any Ontario court sitting in Toronto, Ontario in any action or proceeding
arising out of or relating to the Credit Documents and hereby irrevocably
agrees that all claims in respect of any such action or proceeding may be
heard and determined in such Ontario court. The Borrower, each Lender and
each Agent hereby irrevocably waives, to the fullest extent each may
effectively do so, the defence of an inconvenient forum to the maintenance of
such action or proceeding. The Borrower, each Lender and each Agent agrees
that a final judgment in any such action or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any
other manner provided by Law.

                  SECTION 12.16.    COUNTERPARTS.  This  Agreement may be
executed in any number of  counterparts  (including by way of facsimile) and
all of such counterparts taken together shall be deemed to constitute one and
the same instrument.

                  SECTION 12.17. SEVERABILITY. Any provision of this
Agreement which is or becomes prohibited or unenforceable in any
jurisdiction, does not invalidate, affect or impair the remaining provisions
thereof and any such prohibition or unenforceability in any jurisdiction does
not invalidate or render unenforceable such provision in any other
jurisdiction.

                  SECTION 12.18. ASSIGNMENT TO FEDERAL RESERVE BANK. (1)
Notwithstanding any provision of this Agreement to the contrary, any Lender
governed by the applicable Laws of the United States of America may at any
time assign all or a portion of its rights under this Agreement and all other
documents ancillary thereto (including the Security Documents) to a Federal
Reserve Bank. No such assignment shall relieve the assigning Lender from its
obligations under this Agreement or such other documents.

                  (2) Upon the request of any Lender, the Borrower will
execute and deliver one or more promissory notes substantially in the form of
Schedule 9, evidencing the Term Facility B Commitment and Accommodations
Outstanding under Term Facility B.

                  (3) In the case of any Lender that is a fund that invests
in bank loans, such Lender may, without the consent of the Borrower or
Administrative Agent, assign or pledge all or any portion of its rights under
this Agreement, including the Accommodations and any instrument evidencing
its rights as a Lender under this Agreement, to any holder or, trustee for,
or any other representative of holders of, obligations owed or securities
issued, by such fund, as security for such obligations or securities, without
cost to the Borrower; provided that any foreclosure or similar action by such
trustee or representative shall be subject to the provisions of this Section
concerning assignments. Any such Lender shall, unless otherwise expressly
provided in this Agreement, act on behalf of all of its pledgees in all
dealings with the Borrower in respect of the Credit Facilities and no such
pledgee shall have (i) any voting or consent rights with respect to any
matter requiring the Lenders' consent, (ii) any entitlement to any amounts
payable hereunder, or (iii) any other rights of any nature hereunder until it
has complied with the provisions of this Section concerning assignments.


                                       86

                  SECTION 12.19. GOOD FAITH AND FAIR CONSIDERATION. The
Borrower acknowledges and declares that it has entered into this Agreement
freely and of its own will. In particular, the Borrower acknowledges that
this Agreement was negotiated by it and the Lenders in good faith, and that
there was no exploitation of the Borrower by the Lenders, nor is there any
serious disproportion between the consideration provided by the Lenders and
that provided by the Borrower. Furthermore, the parties to this Agreement
agree to act in good faith and in a reasonable manner with each other during
the Term hereof.



         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective authorized officers as of the date first above
written.

                                          SUN MEDIA CORPORATION


                                          Per: /s/ Mark D'Souza
                                                   ---------------------------
                                                   Authorized Signing Officer





               (signatures continued on the next following page)









                                          BANK OF AMERICA, N.A.
                                          AS ADMINISTRATIVE AGENT


                                          Per: /s/ [Illegible]
                                                   ---------------------------
                                                   Authorized Signing Officer

Term Facility B:

                                               
                                    Address:         555 South Flower St., 17th floor,
                                                     CA9-706-17-54
                                                     Los Angeles, California, 90071
                                                     Attention: Vice-President, Agency
                                                     Telephone: (213) 345-1300
                                                     Fax: (415) 503-5011
                                                     Email: david.price@bankofamerica.com





                                               
                      Address for payments:          Kristine Kelleher
                                                     Bank of America N.A.
                                                     1850 Gateway Blvd., 5th Floor
                                                     MC: CA4-706-05-09
                                                     Concord, CA 94520
                                                     Phone: (925) 675-8373
                                                     Fax: (925) 969-2414
                                                     E-mail: kristine.l.kelleher@bankofamerica.com

                                                  
Facility A:                                          200 Front Street West, Suite 2700
                                                     Toronto, Ontario, M5V 3L2
                                                     Attention: Domingo.Braganza, Credit Services
                                                     Telephone:  (416) 349-5464
                                                     Fax:  (416) 349-4282-4283
                                                     E-mail: Domingo.Braganza@bankofamerica.com

                                                     Alternate - Clara McGibbon, 416-349-5484
                                                     E-mail: Clara.McGibbon@bankofamerica.com








               (signatures continued on the next following page)





               (signatures continued from the preceding page)


                                          BANK OF AMERICA, N.A.
                                          AS ADMINISTRATIVE AGENT

                                          Per: /s/ David Price
                                                   ---------------------------
                                                   Authorized Signing Officer


                                               
                                    Address:         555 South Flower St., 17th floor,
                                                     CA9-706-17-54
                                                     Los Angeles, California, 90071
                                                     Attention: David Price, Vice-President
                                                     Telephone: (213) 345-1300
                                                     Fax: (415) 503-5011
                                                     Email: david.price@bankofamerica.com





                                                  
Address for operations (Facility B):                 Kristine Kelleher
                                                     Bank of America N.A.
                                                     1850 Gateway Blvd., 5th Floor
                                                     MC: CA4-706-05-09
                                                     Concord, CA 94520
                                                     Phone: (925) 675-8373
                                                     Fax: (925) 969-2414
                                                     E-mail: kristine.l.kelleher@bankofamerica.com

                                                  
Address for operations (Facility A):                 Bank of America, N.A., Canada Branch
                                                     200 Front Street West, Suite 2700
                                                     Toronto, Ontario, M5V 3L2

                                                     Attention: Domingo.Braganza, Credit Services
                                                     Telephone:  (416) 349-5464
                                                     Fax:  (416) 349-4282/4283
                                                     E-mail: Domingo.Braganza@bankofamerica.com

                                                     Alternate - Clara McGibbon, 416-349-5484
                                                     E-mail: Clara.McGibbon@bankofamerica.com








               (signatures continued on the next following page)




               (signatures continued from the preceing page)


                                          BANK OF AMERICA, N.A.
                                          AS ADMINISTRATIVE AGENT


                                          Per: /s/ David Price
                                                   ---------------------------
                                                   Authorized Signing Officer


                                               
                                    Address:         555 South Flower St., 17th floor,
                                                     CA9-706-17-54
                                                     Los Angeles, California, 90071
                                                     Attention: David Price, Vice-President
                                                     Telephone: (213) 345-1300
                                                     Fax: (415) 503-5011
                                                     Email: david.price@bankofamerica.com





                                                  
Address for operations (Facility B):                 Kristine Kelleher
                                                     Bank of America N.A.
                                                     1850 Gateway Blvd., 5th Floor
                                                     MC: CA4-706-05-09
                                                     Concord, CA 94520
                                                     Phone: (925) 675-8373
                                                     Fax: (925) 969-2414
                                                     E-mail: kristine.l.kelleher@bankofamerica.com

                                                  
Address for operations (Facility A):                 Bank of America, N.A., Canada Branch
                                                     200 Front Street West, Suite 2700
                                                     Toronto, Ontario, M5V 3L2

                                                     Attention: Domingo.Braganza, Credit Services
                                                     Telephone:  (416) 349-5464
                                                     Fax:  (416) 349-4282/4283
                                                     E-mail: Domingo.Braganza@bankofamerica.com

                                                     Alternate - Clara McGibbon, 416-349-5484
                                                     E-mail: Clara.McGibbon@bankofamerica.com








               (signatures continued on the next following page)







               (signatures continued from the preceding page)


                                                      
Facility A                                                  BANK OF AMERICA, N.A., CANADA
Commitment:                        Cdn.$9,500,000           BRANCH, AS LENDER

Facility B
Commitment:                         Nil                     Per: /s/ Nelson Lam
                                                                    ---------------------------
                                                                    Nelson Lam, Vice President




                                
Swingline
Commitment (Fronting):             Cdn.$5,000,000
Line of Credit
Commitment (Fronting):             Cdn.$2,000,000



ADDRESS:

Corporate Banking
200 Front Street West, Suite 2700
Toronto, Ontario, M5V 3L2
Attention:        Nelson Lam
Telephone:        (416) 349-5496
Fax:              (416) 349-4282
Email:  nelson.lam@bankofamerica.com





               (signatures continued on the next following page)







               (signatures continued from the preceding page)


                                                                 
Facility A                                                             CREDIT SUISSE FIRST BOSTON
Commitment:                        Cdn.$9,000,000                      TORONTO BRANCH, AS LENDER

Facility B
Commitment:                         Nil

                                   Per: /s/ Alain Daoust               /s/ Peter Chauvin
                                       ---------------------------     -----------------
                                        Authorized Signing Officer
                                        Alain Daoust                   Peter Chauvin
                                        Director                        Vice President



Contact:

1 First Canadian Place
P.O. Box 301, Suite 3000
Toronto, Ontario, M5X 1C9

Attention: Alain Daoust

Telephone: (416) 352-4527
      Fax: (416) 352-4576



               (signatures continued on the next following page)






               (signatures continued from the preceding page)


                                                      
Facility A                                                  CITIBANK N.A.,
Commitment:                        Cdn.$9,000,000           CANADIAN BRANCH, AS LENDER

Facility B
Commitment:                        US$____________          Per: /s/ John Hastings
                                                                --------------------------
                                                                Authorized Signing Officer




Contact:
John Hastings / Daljeet Lamba
123 Front Street, West
Toronto, Ontario
Citibank N.A. Canadian Branch
Telephone: (416) 947-2947
      Fax: (416) 947-5802



(signatures continued on the next following page)





               (signatures continued from the preceding page)


                                                      
Facility A                                                  THE TORONTO-DOMINION BANK,
Commitment:                        Cdn.$7,500,000           AS LENDER


Facility B                         Nil                      Per: /s/ Illegible
Commitment:                                                      --------------------------
                                                                 Authorized Signing Officer


                                                            Per: /s/ [Illegible]
                                                                    ---------------------------
                                                                    Authorized Signing Officer




Contact:
Eric Duchesne
66, Wellington Street West, 38th Floor
P.O.Box 1 TD Tower
Toronto, ON M5K 1A2

Telephone: (800) 342-1671
      Fax: (800) 675-6163


               (signatures continued on the next following page)







               (signatures continued from the preceding page)


                                                      
Facility A                                                  THE BANK OF NOVA SCOTIA,
Commitment:                        Cdn.$7,500,000           AS LENDER

Facility B
Commitment:                        Nil                      Per: /s/ Robert King
                                                                 ---------------------------
                                                                 Authorized Signing Officer


                                                            Per: /s/ [Illegible]
                                                                 ---------------------------
                                                                 Authorized Signing Officer





Contact:
Rob King
40 King Street W., 62nd Floor
Toronto, ON Canada

 Tel.: (416) 933-1873
  Fax: (416) 866-2010
Email:  rob_king@scotiacapital.com



               (signatures continued on the next following page)







               (signatures continued from the preceding page)


                                                      
Facility A                                                  ROYAL BANK OF CANADA,
Commitment:                        Cdn.$7,500,000           AS LENDER

Facility B
Commitment:                        US$0                     Per: /s/ Vincent Joli-Coeur
                                      --                         --------------------------
                                                                 Authorized Signing Officer


                                                            Per:
                                                                 ---------------------------
                                                                 Authorized Signing Officer





Contact:
Vincent Joli-Coeur
Royal Bank of Canada
1, Place Ville Marie, Suite 300
Montreal, Quebec




               (signatures continued on the next following page)




               (signatures continued from the preceding page)


                                                      
Facility A                                                  LA CAISSE CENTRALE DESJARDINS DU
Commitment:                        Cdn.$5,000,000           QUEBEC, AS LENDER

Facility B
Commitment:                        US $5,000,000            Per: /s/ Andre Roy
                                                                 ---------------------------
                                                                 Authorized Signing Officer


                                                            Per: /s/ [Illegible]
                                                                 ---------------------------
                                                                 Authorized Signing Officer




Contact:
Andre Roy
Bureau 2822
Montreal Quebec H5B 1B3

Tel: (514) 281-7791
Fax: (514) 281-7083
Email: andre.roy@ccd.desjardins.com






               (signatures continued from the preceding page)


                                                      
                                                            NATIONAL CITY BANK,
                                                            AS LENDER

Facility B
Commitment:                        US$5,000,000             Per: /s/ Chris Kalmbach
                                                                -----------------------
                                                                Authorized Signing Officer

                                                                 CHRISTIAN KALMBACH
                                                                 Senior Vice President



Contact:
Mr. Chris Kalmbach
1 South Broad, 13th Floor
Philadelphia, Pennsylvania
19107 USA
Fax: (267) 256-4001
phone: (267) 256-4022
e-mail: Christian.Kalmbach@nationalcity.com


               (signatures continued on the next following page)




               (signatures continued from the preceding page)


                                                      
Facility A                                                  NATIONAL CITY BANK, CANADA
Commitment:                        Cdn.$5,000,000           BRANCH AS LENDER

Facility B
Commitment:                        US$0                     Per: /s/ Caroline Stade  VP
                                      --                        -------------------
                                                                Authorized Signing Officer





Address: 130 King Street West, Suite 2140
         Toronto, Ont., M5X 1E4
Telephone: (416) 361-1744, ext. 224
Fax:       (416) 361-0085
Credit Contact Information:
- ---------------------------
Caroline Stade               caroline.stade@nationalcity.com


               (signatures continued on the next following page)








               (signatures continued from the preceding page)


                                                      
Facility A                                                  LAURENTIAN BANK OF CANADA,
Commitment:                        Cdn.$5,000,000           AS LENDER

Facility B
Commitment:                        US$3,000,000             Per: /s/ Alain Goyette
                                                                -----------------------
                                                                Authorized Signing Officer

                                                            Per: /s/ [Illegible]
                                                                 ---------------------------
                                                                 Authorized Signing Officer




Contact:
Alain Goyette
1981, McGill College Ave.,
Suite 1980
Montreal, Quebec, H3A 3K3
Tel: (514) 284-4500 ext. 4732
Fax: (514) 284-4551


               (signatures continued on the next following page)





               (signatures continued from the preceding page)


                                                      
Facility A                                                  BANK OF TOKYO-MITSUBISHI
Commitment:                        Cdn.$5,000,000           (CANADA), AS LENDER

Facility B
Commitment:                        US$ Nil                  Per: /s/ Amos Simpson
                                                                --------------------------
                                                                Authorized Signing Officer



                                                            Per:
                                                                 ---------------------------
                                                                 Authorized Signing Officer





Contact:
Amos Simpson
600 de la Gauchetiere West,
Suite 2780
Montreal Quebec, Canada H3B 4L8
Tel: 875-9261
Fax: 875-9392
Email: asimpson@btmna.com


               (signatures continued on the next following page)




               (signatures continued from the preceding page)

                                                      
Facility A                                                  BANK OF MONTREAL,
Commitment:                        Cdn.$5,000,000           AS LENDER

Facility B
Commitment:                        US$3,000,0000            Per: /s/ Ashok Rao
                                                                --------------------------
                                                                Authorized Signing Officer
                                                                ASHOK RAO, VP


                                                            Per:
                                                                 ---------------------------
                                                                 Authorized Signing Officer





Contact:
Ashok Rao
1 First Canadian Place, 4F
Toronto, ON M5X 1H3
Canada
Tel. (416) 359-6873
Fax: (416) 359-7796
Email: ashok.rao@bmo.com

               (signatures continued on the next following page)





               (signatures continued from the preceding page)

                                                      
Facility A                                                  KZH ING-2LLC, AS LENDER
Commitment:                        [Nil]

Facility B
Commitment:                        US$1,000,0000            Per: /s/ Susan Lee
                                                                -----------------------
                                                                Authorized Signing Officer
                                                                SUSAN LEE
                                                                Authorized Agent

                                                            Per:
                                                                 --------------------------
                                                                 Authorized Signing Officer





Contact:
Virginia Conway
C/o JPMorgan Chase Bank
140 East 45th Street, 11th Floor
New York, New York 10017
Tel. (212) 622-9353
Fax: (212) 622-0123
Email: virginia.r.conway@chase.com


               (signatures continued on the next following page)



               (signatures continued from the preceding page)


                                                      
Facility A                                                  KZH STERLING LLC, AS LENDER
Commitment:                        [Nil]

Facility B
Commitment:                        US$1,000,0000        Per: /s/ Susan Lee
                                                            --------------------------
                                                            Authorized Signing Officer
                                                            SUSAN LEE
                                                            Authorized Agent

                                                        Per:
                                                             ---------------------------
                                                             Authorized Signing Officer






Contact:
Virginia Conway
C/o JPMorgan Chase Bank
140 East 45th Street, 11th Floor
New York, New York 10017
Tel. (212) 622-9353
Fax: (212) 622-0123
Email: virginia.r.conway@chase.com


               (signatures continued on the next following page)





               (signatures continued from the preceding page)


                                                      
Facility A                                                  K2H CYPRESSTREE-1 LLC,
Commitment:                        Nil                      AS LENDER

Facility B
Commitment:                        US$1,000,0000            Per: /s/ Susan Lee
                                                               --------------------------
                                                               Authorized Signing Officer
                                                               SUSAN LEE
                                                               Authorized Agent



                                                            Per:
                                                                ---------------------------
                                                                Authorized Signing Officer






Contact:
Virginia Conway
C/o JPMorgan Chase Bank
140 East 45th Street, 11th Floor
New York, New York 10017
Tel. (212) 622-9353
Fax: (212) 622-0123
Email: virginia.r.conway@chase.com


               (signatures continued on the next following page)




               (signatures continued from the preceding page)

                                                      
Facility A                                                  KZH CNC LLC, AS LENDER
Commitment:                        [Nil]

Facility B
Commitment:                        US$ 1,000,000




                                                           Per: /s/ Susan Lee
                                                               --------------------------
                                                               Authorized Signing Officer
                                                               SUSAN LEE
                                                               Authorized Agent


                                                            Per:
                                                                --------------------------
                                                                Authorized Signing Officer






CONTACT:

Virginia Conway
C/o JPMorgan Chase Bank
140 East 45th Street, 11th Floor
New York, New York 10017
Tel. (212) 622-9353
Fax: (212) 622-0123
Email: virginia.r.conway@chase.com



               (signatures continued on the next following page)




               (signatures continued from the preceding page)


                                                      
Facility A                                                  KZH SOLEIL LLC AS LENDER
Commitment:                        [Nil]
Facility B
Commitment:                        US$ 491,400


                                                            Per: /s/ SUSAN LEE
                                                                ---------------------------
                                                                Authorized Signing Officer

                                                                SUSAN LEE
                                                                Authorized Agent


                                                            Per:
                                                                 ---------------------------
                                                                 Authorized Signing Officer




CONTACT:

Virginia Conway
C/o JPMorgan Chase Bank
140 East 45th Street, 11th Floor
New York, New York 10017
Tel. (212) 622-9353
Fax: (212) 622-0123
Email: virginia.r.conway@chase.com



               (signatures continued on the next following page)






               (signatures continued from the preceding page)


                                                      
Facility A                                                  KZH SOLEIL-2 LLC AS LENDER
Commitment:                        [Nil]
Facility B
Commitment:                        US$ 982,800


                                                           Per: /s/ Susan Lee
                                                               --------------------------
                                                               Authorized Signing Officer
                                                               SUSAN LEE
                                                               Authorized Agent


                                                           Per:
                                                               --------------------------
                                                               Authorized Signing Officer




CONTACT:

Attention: Virginia Conway
C/o JPMorgan Chase Bank
140 East 45th Street, 11th Floor
New York, New York 10017
Tel. (212) 622-9353
Fax: (212) 622-0123
Email: virginia.r.conway@chase.com



               (signatures continued on the next following page)






               (signatures continued from the preceding page)


                                                      
Facility A                                                  KZH RIVERSIDE LLC AS LENDER
Commitment:                        [Nil]
Facility B
Commitment:                        US$ 474,600





                                          Per: /s/ Susan Lee
                                                   ---------------------------
                                                   Authorized Signing Officer
                                                   SUSAN LEE
                                                   Authorized Agent



                                          Per:
                                               ---------------------------
                                               Authorized Signing Officer




CONTACT:

Virginia Conway
C/o JPMorgan Chase Bank
140 East 45th Street, 11th Floor
New York, New York 10017
Tel. (212) 622-9353
Fax: (212) 622-0123
Email:  virginia.r.conway@chase.com



               (signatures continued on the next following page)






               (signatures continued from the preceding page)


                                                      
Facility A                                                  STANWICH LOAN FUNDING LLC
Commitment:                        Cdn.$0.00                AS LENDER
Facility B
Commitment:                        US$2,000,000





                                          Per: /s/ Kelly W. Warnement
                                                   ---------------------------
                                                   Kelly W. Warnement
                                                   Vice President





CONTACT:

Banc of America Securities LLC
100 North Tryon Street
NC1-007-06-07
Charlotte, NC 28255
Attention: Kelly Warnement / Annabet Morris / Diana Mushill
Telephone: (704) 388-8943 / (704) 387-1939 / (704) 387-9951
Facsimile: (704) 388-0648
Email:  kelly.w.warnement@bankofamerica.com
        ann.e.morris@bankofamerica.com
        diana.l.mushill@bankofamerica.com

               (signatures continued on the next following page)






               (signatures continued from the preceding page)


                                                      
Facility A                                                  TORONTO DOMINION (TEXAS), INC.
Commitment:                        Cdn$____                           AS LENDER
Facility B
Commitment:                        US$7,000,000.00





                                          Per: /s/ Carol Brandt
                                                   ---------------------------
                                                   Authorized Signing Officer

                                                   CAROL BRANDT
                                                   VICE PRESIDENT


                                          Per:
                                               ---------------------------
                                               Authorized Signing Officer




CONTACT:

909 Fannin, Suite 1700
Houston, Texas 77010
Attention: Carol Brandt
Vice President
Telephone: (713) 653-8248
Fax: (713) 652-0914



               (signatures continued on the next following page)






               (signatures continued from the preceding page)


                                                      
Facility A                                                  PINEHURST TRADING, INC. AS
Commitment:                        Cdn$0.00                 LENDER
Facility B
Commitment:                        US$4,000,000





                                          Per: /s/ Kelly W. Warnement
                                                   ---------------------------
                                                   Kelly W. Warnement




CONTACT:

Banc of America Securities LLC
100 North Tryon Street
NC1-007-06-07
Charlotte, NC 28255
Attention: Kelly Warnement / Annabet Morris / Diana Mushill
Telephone: (704) 388-8943 / (704) 387-1939 / (704) 387-9951
Facsimile: (704) 388-0648
Email:  kelly.w.warnement@bankofamerica.com
        ann.e.morris@bankofamerica.com
        diana.l.mushill@bankofamerica.com

               (signatures continued on the next following page)





               (signatures continued from the preceding page)


                                                      
Facility A                                                  THE TRAVELERS INSURANCE
Commitment:                        [Nil]                    COMPANY AS LENDER
Facility B
Commitment:                        US$ 2,500,000





                                          Per: /s/ William M. Gardner
                                                   ---------------------------
                                                   Authorized Signing Officer
                                                   WILLIAM M. GARDNER
                                                   INVESTMENT OFFICER


                                          Per:
                                               ---------------------------
                                               Authorized Signing Officer





CONTACT:

William Gardner:        william.m.garder@citi.com
Tel.:  (860) 308-8326       Fax: (860) 308-8547

Address:  The Travelers Ins. Co. c/o Citigroup Investments
          242 Trumbull Street,
          P.O. Box 150449, 7th Floor
          Hartford, CT 06115-0449



               (signatures continued on the next following page)





               (signatures continued from the preceding page)


                                                      
Facility A                                                  CITIGROUP INVESTMENTS
Commitment:                        [Nil]                    CORPORATE LOAN FUND INC. AS
                                                            LENDER
Facility B
Commitment:                        US$ 1,500,000





                                          Per: /s/ William M. Gardner
                                                   ---------------------------
                                                   Authorized Signing Officer
                                                   WILLIAM M. GARDNER
                                                   INVESTMENT OFFICER


                                          Per:
                                               --------------------------
                                               Authorized Signing Officer




CONTACT:

John J. Console:        John.J.Console@citi.com
Tel.:  (860) 308-8431          Fax: (860) 308-8556

Address:

242 Trumbull Street,
P.O. Box 150449, 7th Floor
Hartford, CT 06115-0449

Also send all notices to:

Bill Galligan:     wcgalligan@statestreet.com
Tel.: (617) 662-1363   Fax: (617) 988-9663


               (signatures continued on the next following page)









                       SCHEDULE 1 - ACCOMMODATION NOTICE

TO:               BANK OF AMERICA, N.A., as Administrative Agent

FROM:             SUN MEDIA CORPORATION                       DATE:

1)       This Accommodation Notice and Certificate is delivered to you
pursuant to the credit agreement (the "CREDIT AGREEMENT") dated as of
February 7, 2003. All defined terms set forth in this Accommodation Notice
shall have the respective meanings set forth in the Credit Agreement.

2)       We hereby request an [Accommodation/conversion] under
[Facility A or Term Facility B] of the Credit Agreement as follows:

         (a)      Date of Accommodation: _______________________________________
         (b)      Currency and amount of Aaccommodation: _______________________

         (c)      Type of Accommodation: _______________________________________

         (d)      Designated Period(s) (if any): _______________________________

         (e)      maturity date(s) (if applicable): ____________________________

         (f)      payment instruction (if any): ________________________________


3)       We have understood the provisions of the Credit Agreement which are
relevant to the furnishing of this Accommodation Notice. To the extent that
this Accommodation Notice evidences, attests or confirms compliance with any
covenants or conditions precedent provided for in the Credit Agreement, we
have made such examination or investigation as was, in our opinion, necessary
to enable us to express an informed opinion as to whether such covenants or
conditions have been complied with.

4)       WE HEREBY CERTIFY THAT, in our opinion, as of the date hereof:

         (a) All of the representations and warranties of the Borrower contained
in Article 7 of the Credit Agreement (except where qualified in Article 7 as
being made as at a particular date) are true and correct in all material
respects on and as of the date hereof as though made on and as of the date
hereof.

         (b) All of the covenants of the Borrower contained in Article 8 of the
Credit Agreement together with all of the conditions precedent to an Advance and
all other terms and conditions contained in the Credit Agreement have been fully
complied with.

         (c) No Event of Default has occurred and no Default has occurred and is
continuing.

                                                      Yours truly,

                                                      SUN MEDIA CORPORATION

                                                      Per: _____________________

                                                      Title: ___________________





                       SCHEDULE 2 - NOTICE OF REPAYMENT


TO:      BANK OF AMERICA, N.A., as Administrative Agent

FROM:    SUN MEDIA CORPORATION

DATE:

1)       This notice of repayment is delivered to you pursuant to the Credit
Agreement dated as of February 7, 2003 entered into among SUN MEDIA
CORPORATION and, INTER ALIA, Bank of America, N. A. as Administrative Agent
(as in effect on the date hereof, the "CREDIT AGREEMENT"). All defined terms
set forth in this notice shall have the respective meanings set forth in the
Credit Agreement.

2)       We hereby advise you that we will be repaying the sum of
[Cdn. / US$_________ on __________as follows [INDICATE AMOUNT PAYABLE IN
RESPECT OF EACH FACILITY AS WELL AS THE TYPE OF ADVANCE TO BE REPAID].

3)       As to an amount of [Cdn. / US$__________, the above-mentioned payment
should be treated as a [MANDATORY PREPAYMENT / VOLUNTARY PREPAYMENT]
under Section [2.05 / 2.06], which we understand will have the effect of
reducing the amount of Term Facility B by an equal amount (or by an
equivalent amount, if in US$). [IF THE PAYMENT IS A MANDATORY PREPAYMENT
RESULTING FROM AN ASSET SALE, IT WILL BE APPLIED PRO RATA TO PERMANENTLY
REDUCE TERM FACILITY B (UNLESS IT IS AN UNACCEPTABLE PAYMENT) AND
TEMPORARILY REDUCE FACILITY A, IF THERE ARE ANY ACCOMMODATIONS OUTSTANDING
UNDER FACILITY A; ANY OTHER MANDATORY PREPAYMENT, UNLESS IT IS AN
UNACCEPTABLE PAYMENT, WILL PERMANENTLY REDUCE TERM FACILITY B; IN ALL
CASES, PROVIDE DETAILS OF THE CALCULATIONS USED TO DETERMINE THE AMOUNTS.]

                                            Yours truly,

                                            SUN MEDIA CORPORATION

                                            Per: _______________________

                                            Title: _____________________






                      SCHEDULE 3 - OFFER TO TERM LENDERS


TO:      [NAME OF TERM LENDER]

FROM:    SUN MEDIA CORPORATION

DATE:

1)       This offer of repayment is delivered to you pursuant to the Credit
Agreement dated as of February 7, 2003 entered into among SUN MEDIA
CORPORATION and, INTER ALIA, Bank of America, N.A. as Administrative Agent
(as in effect on the date hereof, the "CREDIT AGREEMENT"). All defined terms
set forth in this notice shall have the respective meanings set forth in the
Credit Agreement.

2)       We hereby advise you that on [INSERT DATE, AT LEAST 10 AND NOT MORE
THAN 20 BUSINESS DAYS FROM THE DATE OF THIS OFFER] (the "PAYMENT DATE"), we
will be making a Mandatory Repayment of Term Facility B in an aggregate
amount of US $__________, of which your proportionate share, based on your
Commitment under Term Facility B, is US $__________ [INDICATE AMOUNT PAYABLE].

3)       In accordance with the provisions of the Credit Agreement, you are
required to advise us in writing, with a copy to the Administrative Agent,
not less than 3 Business Days before the Payment Date if you wish to accept
the Mandatory Repayment in question, failing which you shall be deemed to
have accepted same.

                                            Yours truly,

                                            SUN MEDIA CORPORATION

                                            Per: _______________________

                                            Title: _____________________











                                  SCHEDULE 4

                              APPLICABLE MARGINS
                                 (per annum)

ACCOMMODATIONS UNDER FACILITY A:



- -----------------------------------------------------------------------------------------------------------------
                                             BA DRAWING FEE
                                              AND LETTER OF
                                               CREDIT FEE           CDN.$ PRIME RATE
   TIER           LEVERAGE RATIO                                         ADVANCES               COMMITMENT FEES
- -----------------------------------------------------------------------------------------------------------------
                                                                                    
I           GREATER THAN OR EQUAL TO 3.25:1        2.25%                  1.25%                      .375%
- -----------------------------------------------------------------------------------------------------------------
II          GREATER THAN OR EQUAL TO 2.75:1
            and LESS THAN 3.25:1                   2.00%                  1.00%                      .375%
- -----------------------------------------------------------------------------------------------------------------
III         LESS THAN 2.75:1                       1.75%                  0.75%                      .25%
- -----------------------------------------------------------------------------------------------------------------



ADVANCES UNDER TERM FACILITY B:



- -----------------------------------------------------------
                                   US$ PRIME RATE
             LIBOR                    ADVANCES
- -----------------------------------------------------------
                                
             2.50%                          1.50%
- -----------------------------------------------------------









                                  SCHEDULE 5

                     SECURITY AND SECURITY DOCUMENTS

1.       Unconditional joint and several (solidary) guarantees (and, after the
         occurrence of a Default which is continuing or an Event of Default, a
         postponement of claims), by each of the Guarantors in favour of the
         Administrative Agent on behalf of the Lenders, of the obligations of
         the Borrower under the Credit Documents;
2.       A first-ranking (subject only to Permitted Liens) pledge of all of the
         shares of each direct and indirect subsidiary of the Borrower,
         including a pledge of partnership and other similar ownership interests
         where applicable;
3.       First-ranking security (subject only to Permitted Liens) in favour of
         the Administrative Agent on behalf of the Lenders, by way of a hypothec
         on the universality of all of the movable and immovable property of the
         Borrower and each of the Guarantors which property is or is deemed to
         be located in the Province of Quebec (and/or, at the option of the
         Agent, by way of a hypothec securing debentures ("DEBENTURES") granted
         in favour of the Administrative Agent or a collateral agent designated
         by the Administrative Agent as the holder of a power of attorney
         ("fonde de pouvoir") of the Lenders within the meaning of Article 2692
         of the Civil Code of Quebec, as contemplated by Section 10.10 of the
         Credit Agreement);
4.       First-ranking (subject only to Permitted Liens) General Security
         Agreements and mortgages charging all of the property and assets,
         personal (movable) and real (immovable) of the Borrower and the
         Guarantors, which property is located anywhere in Canada (outside of
         Quebec) or in the USA (and/or, at the option of the Administrative
         Agent, by way of a debenture or other instrument creating the same
         Liens);
5.       To the extent not already created in virtue of the Security conferred
         under the previous paragraphs of this schedule, first-ranking
         assignment by the Borrower and the Guarantors (other than such of same
         as are domiciled in Quebec) by way of collateral security, of the
         contracts governing or evidencing intellectual property rights (subject
         to Permitted Liens, and to the extent not prohibited by the terms of
         the agreements governing such rights) in favour of the Administrative
         Agent on behalf of the Lenders;
6.       By way of collateral security, to the extent permitted by applicable
         Laws and to the extent not already created in virtue of the Security
         conferred under the previous paragraphs of this schedule, a transfer
         and assignment to the Administrative Agent (and/or the fonde de
         pouvoir) on behalf of the Lenders, as its interest may appear, of
         all of the right, title and interest of the Borrower and the
         Guarantors in and to all indemnities, proceeds, benefits and
         advantages arising under any insurance policy or contract protecting
         the Borrower and the Guarantors and their personal (movable)
         property and activities against any form of loss, including business
         interruption and third party liability, and cause the Administrative
         Agent (and/or the fonde de pouvoir) on behalf of the Lenders to be
         named in all such policies as a named insured as its interest may
         appear, and delivery to the Administrative Agent of certificates of
         insurance in form and substance satisfactory to the Administrative
         Agent;



provided that no security shall be granted over (i) the Assets of Toronto Sun
International, Inc., T.S. Printing Inc. and Florida Sun Publications, Inc., if
the Assets in question or the shares of each of them are sold in accordance with
the provisions of Section 8.02(d) of the Credit Agreement within 60 days from
the Closing Date, or (ii) the shares or Assets of Le Courrier du Sud (1998) Inc.
during such time as a Person who is not an Affiliate of the Borrower holds
shares in such company, or (iii) the shares/partnership units of any Person who
is not a wholly-owned direct or indirect subsidiary of the Borrower for so long
as there is a prohibition against such security under any applicable partnership
or shareholders' agreement.

In the event that the ability of any Guarantor to guarantee the obligations of
the Borrower under the Credit Agreement is restricted under applicable Law, its
Guarantee shall be structured in a manner to be determined by the Agent, acting
reasonably and in accordance with applicable Law.









                                  SCHEDULE 6

          MASTER ASSIGNMENT AND ASSUMPTION AGREEMENT - TERM FACILITY B


This Master Assignment and Assumption Agreement (this "ASSIGNMENT AND
ASSUMPTION") dated as of the Trade Date referred to below is entered into by and
between the party identified below as "ASSIGNOR" and each party identified on
each signature page hereto as an "ASSIGNEE". Capitalized terms used but not
defined herein shall have the meanings given to them in the Credit Agreement
identified below (as amended or modified from time to time, the "CREDIT
AGREEMENT"), receipt of a copy of which is hereby acknowledged by each Assignee.
The Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably and ratably
sells and assigns to each Assignee, and each Assignee hereby irrevocably
purchases and assumes from the Assignor, subject to and in accordance with
the Standard Terms and Conditions and the Credit Agreement, as of the
Effective Date referred to below (i) all of the Assignor's respective rights
and obligations under the Credit Agreement and any other documents or
instruments delivered pursuant thereto to the extent related to the amount
and percentage interest identified below the signature of that Assignee of
all the Assignor's respective outstanding rights and obligations under Term
Facility B (including without limitation any guarantees and Security included
in such facilities) and (ii) to the extent permitted to be assigned under
applicable law, all claims, suits, causes of action and any other rights of
the Assignor (in its capacity as a Lender) against any Person, whether known
or unknown, arising under or in connection with the Credit Agreement, any
other documents or instruments delivered pursuant thereto or the loan
transactions governed thereby or in any way based on or related to any of the
foregoing, including, but not limited to, contract claims, tort claims,
malpractice claims, statutory claims and all other claims at law or in equity
related to the rights and obligations sold and assigned pursuant to clause
(i) above (the rights and obligations sold and assigned pursuant to clauses
(i) and (ii) above being referred to herein collectively as to each Assignee,
the "ASSIGNED INTEREST"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.

                               
1.       Assignor:                   Bank of America, N. A.

2.       Assignees and their
         Assigned Interests:         Listed on the signature pages attached
                                     hereto

3.       Borrower:                   Sun Media Corporation

4.       Administrative Agent:       Bank of America, N. A., as the
                                     administrative agent under the Credit
                                     Agreement referred to below

5.       Credit Agreement:           The Credit Agreement, dated as of
                                     February 7, 2003 among the Borrower named
                                     above, the Lenders parties thereto, and
                                     the Administrative Agent named above




                 Master Assignment and Assumption Agreement for ________________



                               
6.       Aggregate Amount of Assigned Interests in Term Facility B:

                                     Principal Amount of Term
                                      Facility B, subject of
                                        this assignment(1)
                                     ------------------------

                                        US$_______________

                                        US$_______________

7.       Effective Date:             As to each Assignee, as indicated on
                                     attached signature page thereof

8.       Trade Date:                 As to each Assignee, as indicated on
                                     attached signature page thereof



The terms set forth in this Assignment are hereby agreed to:

ASSIGNOR:                           BANK OF AMERICA, N. A.



                                    By: _______________________________________
                                         Name:
                                         Title:


Consent and Acceptance:             BANK OF AMERICA, N. A.,
                                    as Administrative Agent



                                    By: _______________________________________
                                         Name:
                                         Title:

Consent and Acceptance:(2)          SUN MEDIA CORPORATION, as Borrower



                                    By: _______________________________________
                                         Name:
                                         Title:

- ----------

         (1) Adjust to take into account any payments or prepayments made
between Trade Date and Effective Date.
         (2) Obtain indicated consent(s) only if required by Credit Agreement.


                 Master Assignment and Assumption Agreement for ________________



ASSIGNEE:                          ____________________________________________
                                                [NAME OF ASSIGNEE]


                                   By: _________________________________________
                                       [ENTITY SIGNING ON BEHALF OF ASSIGNEE](3)


                                   By: _______________________________________
                                        Name:
                                        Title:


                                   (4)Assignee is an Affiliate/Approved Fund of:


                                    ____________________________________________
                                                  [IDENTIFY LENDER]

Assigned Interest to this Assignee:



                                                 Principal Amount of Term
                                                  Facility B, subject of
                                                     this assignment(5)
                                                 ------------------------

                                                     US$______________

                                                     US$______________


Trade Date:       ________________________________________
Effective Date:   ________________________________________(6)

- ----------

         (3) Include if a general partner or manager of the Assignee is signing
on behalf of the Assignee.
         (4) Include as applicable.
         (5) Adjust to take into account any payments or prepayments made
between Trade Date and Effective Date.
         (6) Effective date to be inserted by Administrative Agent.



   Signature Page for Master Assignment and Assumption Agreement for ___________



                                            ANNEX 1 TO ASSIGNMENT AND ASSUMPTION


                       STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT
                                AND ASSUMPTION AGREEMENT


                1.    REPRESENTATIONS AND WARRANTIES.
                1.1. ASSIGNOR. The Assignor (a) represents and warrants that (i)
it is the legal and beneficial owner of each Assigned Interest, (ii) each
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Documents or any other instrument or document delivered
pursuant thereto, other than this Agreement, or any Collateral thereunder, (iii)
the financial condition of any Loan Party, any of its subsidiaries or Affiliates
or any other Person obligated in respect of any Loan Document or (iv) the
performance or observance by any Loan Party, any of its subsidiaries or
Affiliates or any other Person of any of their respective obligations under any
Loan Document.
                1.2. ASSIGNEE. Each Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement, (iii) from and after the Effective Date, it shall be bound by
the provisions of the Credit Agreement and, to the extent of the Assigned
Interest, shall have the obligations of a Lender thereunder, (iv) it has
received a copy of the Credit Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 8.01 thereof, as applicable,
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision; (v) if the contemplated Assignment and
Assumption is under Facility A and occurs prior to an Event of Default which has
not been waived, it is not a non-resident of Canada within the meaning of the
Income Tax Act (Canada); and (b) agrees that (i) it will, independently and
without reliance on the Administrative Agent, the Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Documents are
required to be performed by it as a Lender.
                1.3 ASSIGNEE'S ADDRESS FOR NOTICES, ETC. Administrative Details
(including credit contact information, addresses, phone and facsimile
information and account and payment instructions) have been provided in the
Administrative Questionnaire previously delivered to the Administrative Agent.
                2. PAYMENTS. From and after the Effective Date for each
Assignee, the Administrative Agent shall make all payments in respect of the
Assigned Interest for such Assignee (including payments of principal, interest,
fees and other amounts) to such Assignee whether such amounts have accrued prior
to, or on or after such Effective Date. The Assignor and such Assignee shall
make all appropriate adjustments in payments by the Administrative Agent for
periods prior to such Effective Date or with respect to the making of this
assignment directly between themselves.
                3. GENERAL PROVISIONS. This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by, and construed in accordance with, the law
of the Province of Ontario.



                              Annex 1 -- Page 1
        Master Assignment and Assumption Agreement for ____________________



                             SCHEDULE 6 (continued)
                           ASSIGNMENT AND ASSUMPTION

                  This Assignment and Assumption (the "ASSIGNMENT AND
ASSUMPTION") is dated as of the Effective Date set forth below and is entered
into by and between [INSERT NAME OF ASSIGNOR] (the "ASSIGNOR") and [INSERT NAME
OF ASSIGNEE] (the "ASSIGNEE"). Capitalized terms used but not defined herein
shall have the meanings given to them in the Credit Agreement identified below
(as amended, the "CREDIT AGREEMENT"), receipt of a copy of which is hereby
acknowledged by the Assignee. The Standard Terms and Conditions set forth in
Annex 1 attached hereto are hereby agreed to and incorporated herein by
reference and made a part of this Assignment and Assumption as if set forth
herein in full.
                  For an agreed consideration, the Assignor hereby irrevocably
sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases
and assumes from the Assignor, subject to and in accordance with the Standard
Terms and Conditions and the Credit Agreement, as of the Effective Date inserted
by the Administrative Agent as contemplated below (i) all of the Assignor's
rights and obligations in its capacity as a Lender under the Credit Agreement,
the other Credit Documents and any other documents or instruments delivered
pursuant thereto to the extent related to the amount and percentage interest
identified below of all of such outstanding rights and obligations of the
Assignor under the respective facilities identified below (including without
limitation any letters of credit, guarantees, Security and Swingline Advances
included in such facilities) and (ii) to the extent permitted to be assigned
under applicable law, all claims, suits, causes of action and any other right of
the Assignor (in its capacity as a Lender) against any Person, whether known or
unknown, arising under or in connection with the Credit Agreement, any other
documents or instruments delivered pursuant thereto or the loan transactions
governed thereby or in any way based on or related to any of the foregoing,
including, but not limited to, contract claims, tort claims, malpractice claims,
statutory claims and all other claims at law or in equity related to the rights
and obligations sold and assigned pursuant to clause (i) above (the rights and
obligations sold and assigned pursuant to clauses (i) and (ii) above being
referred to herein collectively as, the "ASSIGNED INTEREST"). Such sale and
assignment is without recourse to the Assignor and, except as expressly provided
in this Assignment and Assumption, without representation or warranty by the
Assignor.

1.       Assignor:                  ______________________________

2.       Assignee:                  ______________________________
                                    [and is an Affiliate/Approved Fund of
                                    [IDENTIFY LENDER](7)]
3.       Borrower(s):               Sun Media Corporation
4.       Administrative Agent:      Bank of America, N. A., as the
                                    administrative agent under the Credit
                                    Agreement
5.       Credit Agreement:          The Credit Agreement dated as of February 7,
                                    2003, among Sun Media Corporation, the
                                    Lenders parties thereto, Bank of America
                                    N.A., as Administrative Agent, and the
                                    other agents parties thereto, for an
                                    amount of US $230,000,000 and
                                    Cdn.$75,000,000.
6.        Assigned Interest:


- ------------------------------ ----------------------------- ----------------------------- ---------------------------
          Facility Assigned(8)      Aggregate Amount of               Amount of               Percentage Assigned of
                                 Commitment/Loans for all          Commitment/Loans             Commitment/Loans(9)
                                          Lenders*                     Assigned*
- ------------------------------ ----------------------------- ----------------------------- ---------------------------
                                                                                     
                                 $                             $                                               %
- ------------------------------ ----------------------------- ----------------------------- ---------------------------
                                 $                             $                                               %
- ------------------------------ ----------------------------- ----------------------------- ---------------------------
                                 $                             $                                               %
- ------------------------------ ----------------------------- ----------------------------- ---------------------------


- ----------

         (7) Select as applicable.

         (8) Fill in the appropriate terminology for the types of facilities
under the Credit Agreement that are being assigned under this Assignment
(i.e. "Facility A Commitment," or "Term Facility B Commitment").

         * Amount to be adjusted by the counterparties to take into account
any payments or prepayments made between the Trade Date and the Effective
Date.

         (9) Set forth, to at least 9 decimals, as a percentage of the
Commitment/Loans of all Lenders thereunder.



[7.      Trade Date:                ______________](10)
Effective Date:  _____________  ___, 20___ [TO BE INSERTED BY  ADMINISTRATIVE
AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE
REGISTER THEREFOR.]

The terms set forth in this Assignment and Assumption are hereby agreed to:
                                              ASSIGNOR
                                              [NAME OF ASSIGNOR]


                                               By:______________________________
                                                    Title:

                                               ASSIGNEE
                                               [NAME OF ASSIGNEE]


                                                By:_____________________________
                                                     Title:


- ----------
    (10) To be completed if the Assignor and the Assignee intend that the
minimum assignment amount is to be determined as of the Trade Date.





Consented to and Accepted:

BANK OF AMERICA N. A., as
Administrative Agent

By_________________________________
  Title:



Consented to and Accepted in respect of Facility A, where applicable:

BANK OF AMERICA, N. A., Canada Branch
as Issuing Lender and Swingline Lender


By________________________________
Title:



Consented to and Accepted:

SUN MEDIA CORPORATION, as Borrower


By_________________________________
  Title:










                                    ANNEX 1
   Credit Agreement entered into among Sun Media Corporation, as Borrower,
               Bank of America, N. A., as Administrative Agent,
          and the Lenders party thereto dated as of February 7, 2003


           STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT AND ASSUMPTION


                  1.  REPRESENTATIONS AND WARRANTIES.

                  1.1 ASSIGNOR. The Assignor (a) represents and warrants that
(i) it is the legal and beneficial owner of the Assigned Interest, (ii) the
Assigned Interest is free and clear of any lien, encumbrance or other adverse
claim and (iii) it has full power and authority, and has taken all action
necessary, to execute and deliver this Assignment and Assumption and to
consummate the transactions contemplated hereby; and (b) assumes no
responsibility with respect to (i) any statements, warranties or representations
made in or in connection with the Credit Agreement or any other Credit Document,
(ii) the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Documents or any collateral thereunder, (iii) the
financial condition of the Borrower, any of its Subsidiaries or Affiliates or
any other Person obligated in respect of any Credit Document or (iv) the
performance or observance by the Borrower, any of its Subsidiaries or Affiliates
or any other Person of any of their respective obligations under any Credit
Document.

                  1.2. ASSIGNEE. The Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Lender under the Credit
Agreement, (ii) it meets all requirements of an Eligible Assignee under the
Credit Agreement (subject to receipt of such consents as may be required under
the Credit Agreement), (iii) from and after the Effective Date, it shall be
bound by the provisions of the Credit Agreement as a Lender thereunder and, to
the extent of the Assigned Interest, shall have the obligations of a Lender
thereunder, (iv) it has received a copy of the Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to Section
8.01 thereof, as applicable, and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Assumption and to purchase the Assigned Interest on the
basis of which it has made such analysis and decision independently and without
reliance on the Administrative Agent or any other Lender; (v) if the
contemplated Assignment and Assumption is under Facility A and occurs prior to
an Event of Default which has not been waived, it is not a non-resident of
Canada within the meaning of the Income Tax Act (Canada); and (b) agrees that
(i) it will, independently and without reliance on the Administrative Agent, the
Assignor or any other Lender, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Documents, and (ii) it will perform
in accordance with their terms all of the obligations which by the terms of the
Credit Documents are required to be performed by it as a Lender.

                1.3 ASSIGNEE'S ADDRESS FOR NOTICES, ETC. Attached hereto as
Schedule 1 is all contact information, address, account and other administrative
information relating to the Assignee.

                  2. PAYMENTS. From and after the Effective Date, the
Administrative Agent shall make all payments in respect of the Assigned Interest
(including payments of principal, interest, fees and other amounts) to the
Assignee whether such amounts have accrued prior to, or on or after such
Effective Date. The Assignor and such Assignee shall make all appropriate
adjustments in payments by the Administrative Agent for periods prior to such
Effective Date or with respect to the making of this assignment directly between
themselves.

                  3. GENERAL PROVISIONS. This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption



                                       (2)

by telecopy shall be effective as delivery of a manually executed counterpart
of this Assignment and Assumption. This Assignment and Assumption shall be
governed by, and construed in accordance with, the law of the Province of
Ontario.




              SCHEDULE 1 TO ASSIGNMENT AND ASSUMPTION AGREEMENT
                             ADMINISTRATIVE DETAILS

              (ASSIGNEE TO LIST NAMES OF CREDIT CONTACTS, ADDRESSES, PHONE
            AND FACSIMILE NUMBERS, ELECTRONIC MAIL ADDRESSES AND INFORMATION)





                                   SCHEDULE 7

                                   GUARANTORS



                            BOWES PUBLISHERS LIMITED
                         SUN MEDIA (TORONTO) CORPORATION
                               SMC NOMINEECO INC.
                               3661458 CANADA INC.
                         TORONTO SUN INTERNATIONAL, INC.
                               T.S. PRINTING, INC.
                         FLORIDA SUN PUBLICATIONS, INC.
                               3351611 CANADA INC.





                                   SCHEDULE 8


                           SUBORDINATION AGREEMENT FOR
                             BACK-TO-BACK SECURITIES

This SUBORDINATION AGREEMENT is dated as of o, 200o (the "Agreement").

To: Bank of America, N.A., for itself and as Administrative Agent under the
Credit Agreement (defined below) for the Lenders (the "ADMINISTRATIVE
AGENT"), o , a o company (the "OBLIGOR"), as obligor under the o dated as of
o, and o in the principal amount of o $ o and o $ o, respectively, made by
the Obligor in favour of o (the "SUBORDINATED NOTES"), and o, as holder (the
"HOLDER") of the Subordinated Notes, for ten dollars and other good and
valuable consideration received by each of the Obligor and the Holder from
the Administrative Agent and by each of the Obligor and the Holder from the
other, agree as follows:

1.       INTERPRETATION.

     (a)  "CASH, PROPERTY OR SECURITIES". "Cash, Property or Securities"
shall not be deemed to include securities of the Obligor or any other Person
provided for by a plan of reorganization or readjustment, the payment of
which is subordinated at least to the extent provided herein with respect to
the Subordinated Notes, to the payment of all Senior Indebtedness which may
at the time be outstanding; provided, however, that (i) all Senior
Indebtedness is assumed by the new Person, if any, resulting from any such
reorganization or readjustment, and (ii) the rights of the holders of the
Senior Indebtedness are not, without the consent of such holders, altered by
such reorganization or readjustment.

     (b)  "PAYMENT IN FULL". "payment in full", with respect to Senior
Indebtedness, means the receipt on an irrevocable basis of cash in an amount
equal to the unpaid principal amount of the Senior Indebtedness and premium,
if any, and interest and any special interest thereon to the date of such
payment, together with all other amounts owing with respect to such Senior
Indebtedness.

     (c)  "SENIOR INDEBTEDNESS". "Senior Indebtedness" means, at any date all
indebtedness (including, without limitation, any and all amounts of
principal, interest, special interest, additional amounts, premium, fees,
penalties, indemnities and "post-petition interest" in bankruptcy and any
reimbursement of expenses) under (1) the Indenture , including, without
limitation, the "Notes", the "Subsidiary Guarantees", the "Exchange Notes",
the "Additional Notes" and any Guarantee of the Exchange Notes or the
Additional Notes (in each case, as defined in the Indenture) and (2) the
Credit Agreement, dated as of February 7, 2003, among the Obligor, the
financial institutions identified as lenders therein, Banc of America
Securities LLC, as joint lead arranger, Bank of America, N.A., as
administrative agent, and Credit Suisse First Boston Corporation, as joint
lead arranger and syndication agent (the "CREDIT AGREEMENT"; capitalized
terms used herein without definition having the meanings set forth therein).



                                      (2)

2.       AGREEMENT ENTERED INTO PURSUANT TO CREDIT AGREEMENT. The Obligor,
the Administrative Agent and the Lenders are entering into this Agreement
pursuant to the provisions of the Credit Agreement, pursuant to which Sun
Media Corporation has borrowed US$230,000,000 and has additional borrowings
available of Cdn.$75,000,000 (the "ACCOMMODATIONS").

3.       SUBORDINATION. The indebtedness represented by the Subordinated
Notes shall be subordinated as follows:

     (a)  AGREEMENT TO SUBORDINATE. The Obligor, for itself and its
successors and assigns, and the Holder agree that the indebtedness evidenced
by the Subordinated Notes (including, without limitation, principal,
interest, premium, fees, penalties, indemnities and "post-petition interest"
in bankruptcy and any reimbursement of expenses) is subordinate and junior in
right of payment, to the extent and in the manner provided in this Section 3,
to the prior payment in full of all Senior Indebtedness. The provisions of
this Section 3 are for the benefit of the Administrative Agent acting on
behalf of the holders from time to time of Senior Indebtedness under the
Credit Agreement, and such holders are hereby made obligees hereunder to the
same extent as if their names were written herein as such, and they
(collectively or singly) may proceed to enforce such provisions.

     (b)  LIQUIDATION, DISSOLUTION OR BANKRUPTCY.

          (i)    Upon any distribution of assets of the Obligor to creditors
                 or upon a liquidation or dissolution or winding-up of the
                 Obligor or in a bankruptcy, arrangement, liquidation,
                 reorganization, insolvency, receivership or similar case or
                 proceeding relating to the Obligor or its property or other
                 marshalling of assets of the Obligor:

                 (A)    the holders of Senior Indebtedness shall be entitled
                        to receive payment in full of all Senior
                        Indebtedness before the Holder shall be entitled to
                        receive any payment of principal of or interest on,
                        or any other amount owing in respect of, the
                        Subordinated Notes;

                 (B)    until payment in full of all Senior Indebtedness, any
                        distribution of assets of the Obligor of any kind or
                        character to which the Holder would be entitled but
                        for this Section 3 is hereby assigned to the holders
                        of Senior Indebtedness absolutely and shall be paid
                        by the Obligor or by any receiver, trustee in
                        bankruptcy, liquidating trustee, agents or other
                        Persons making such payment or distribution to, the
                        Administrative Agent behalf of the holders of Senior
                        Indebtedness under the Credit Agreement, as their
                        interests may appear; and

                 (C)    in the event  that,  notwithstanding  the  foregoing,
                        any  payment or  distribution  of assets of the
                        Obligor of any kind or character,  whether in Cash,
                        Property or  Securities,  shall be received by the



                                      (3)

                        Holder  before all Senior  Indebtedness is paid in
                        full,  such payment or distribution  shall be held in
                        trust for the benefit of and shall be paid over to
                        the  Administrative  Agent on behalf of the  holders
                        of Senior Indebtedness  under the Credit  Agreement,
                        as their  interests may appear,  for application to
                        the payment of all Senior  Indebtedness  under the
                        Credit Agreement until all such Senior  Indebtedness
                        shall have been paid in full after giving effect to
                        any concurrent  payment or  distribution to the
                        holders of Senior Indebtedness under the Credit
                        Agreement in respect of such Senior Indebtedness.

          (ii)   If (A) a bankruptcy,  reorganization,  insolvency,
                 receivership or similar proceeding relating to the Obligor
                 or its property (a  "REORGANIZATION  PROCEEDING")  is
                 commenced  and is  continuing  and (B) the Holder does not
                 file proper claims or proofs of claim in the form required
                 in a  Reorganization  Proceeding  prior to 45 days before
                 the expiration  of the time to file such  claims,  then (1)
                 upon the request of the  Administrative  Agent,  the Holder
                 shall file such  claims and proofs of claim in respect of
                 the  Subordinated  Notes and  execute  and deliver  such
                 powers of  attorney,  assignments  and proofs of claim or
                 proxies as may be  directed  by the Administrative  Agent to
                 enable it to exercise in the sole  discretion of the
                 Administrative  Agent any and all voting  rights
                 attributable  to the  Subordinated  Notes which are  capable
                 of being voted  (whether by meeting,  written  resolution or
                 otherwise) in a  Reorganization  Proceeding  and enforce any
                 and all claims upon  or in  respect  of the  Subordinated
                 Notes  and to  collect  and  receive  any and  all  payments
                 or distributions  which may be payable or deliverable at
                 any time upon or in respect of the Subordinated Notes, and
                 (2) whether or not the  Administrative  Agent shall take the
                 action  described in clause (1) above,  the Administrative
                 Agent shall  nevertheless  be deemed to have such powers of
                 attorney as may be  necessary to enable the Administrative
                 Agent to exercise such voting rights, file appropriate
                 claims and proofs of claim and otherwise exercise the powers
                 described above for and on behalf of the Holder.

     (c)  SUBROGATION. After all Senior Indebtedness is paid in full and
until the Subordinated Notes are paid in full, the Holder shall be subrogated
to the rights of the holders of Senior Indebtedness. For purposes of this
Section 3(c), a distribution made under this Section 3 to holders of Senior
Indebtedness which otherwise would have been made to the Holder, or a payment
made by the Holder to holders of Senior Indebtedness in respect of a turnover
obligation under this Section 3, is not, as between the Obligor and such
holder, a payment by the Obligor on Senior Indebtedness.

     (d)  RELATIVE RIGHTS. This Section 3 defines the relative rights of the
Holder and the holders of Senior  Indebtedness.  Nothing in this Section 3
shall:



                                      (4)

          (i)    impair, as between the Obligor and the Holder, the
                 obligation of the Obligor, which is absolute and
                 unconditional, to pay the principal of and interest on the
                 Subordinated Notes in accordance with their terms; or

          (ii)   affect the relative rights of the Holder and creditors of
                 the Obligor other than the holders of Senior Indebtedness; or

          (iii)  affect the relative rights of the holders of Senior
                 Indebtedness among themselves or opposite the Obligor under
                 the Credit Documents; or

          (iv)   prevent the Holder from exercising its available remedies
                 upon a default, subject to the rights of the holders of
                 Senior Indebtedness to receive cash, property or other
                 assets otherwise payable to the Holder.

(e)      SUBORDINATION MAY NOT BE IMPAIRED.

          (i)    No right of any holder of Senior  Indebtedness  to enforce
                 the  subordination  of indebtedness  evidenced by the
                 Subordinated Notes shall in any way be  prejudiced or
                 impaired by any act or failure to act by the Obligor or by
                 any such holder or the Administrative  Agent, or by any
                 non-compliance by the Obligor with the terms,  provisions or
                 covenants herein,  regardless of any knowledge thereof which
                 any such holder or the Administrative Agent may have or be
                 otherwise charged with.  Neither the  subordination of the
                 Subordinated  Notes as herein provided nor the  rights of
                 the  holders  of  Senior  Indebtedness  with  respect
                 hereto  shall be  affected  by any extension,  renewal or
                 modification of the terms, or the granting of any security
                 in respect of, any Senior Indebtedness or any exercise or
                 non-exercise of any right, power or remedy with respect
                 thereto.

          (ii)   The Holder agrees that all indebtedness evidenced by the
                 Subordinated Notes will be unsecured by any Lien upon or
                 with respect to any property of the Obligor.

          (iii)  The Holder agrees not to exercise any offset or counterclaim
                 or similar right in respect of the indebtedness evidenced by
                 the Subordinated Notes except to the extent payment of such
                 indebtedness is permitted and will not assign or otherwise
                 dispose of the Subordinated Notes or the indebtedness which
                 it evidences unless the assignee or acquiror, as the case
                 may be, agrees to be bound by the terms of this Agreement.

(g)      HOLDER ENTITLED TO RELY.

         Upon any payment or distribution pursuant to this Section 3, the
         Holder shall be entitled to rely (i) upon any order or decree of a
         court of competent jurisdiction in which any proceedings of the
         nature referred to in Section 3(b) are pending, (ii) upon a
         certificate if the liquidating trustee or agent or other person in
         such proceedings making such payment or distribution to the Holder
         or its



                                      (5)

         representative, if any, or (iii) upon a certificate of the
         Administrative Agent or any representative (if any) of the holders
         of Senior Indebtedness for the purpose of ascertaining the persons
         entitled to participate in such payment or distribution, the holders
         of the Senior Indebtedness and other indebtedness of the Obligor,
         the amount thereof or payable thereon, the amount or amounts paid or
         distributed thereon and all other facts pertinent thereto or to this
         Section 3.

4.   ENFORCEABILITY. Each of the Obligor and the Holder represents and
warrants that this Agreement has been duly authorized, executed and delivered
by each of the Obligor and the Holder and constitutes a valid and legally
binding obligation of each of the Obligor and the Holder, enforceable in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; and on the date hereof, the Holder shall deliver an
opinion or opinions of counsel to such effect to the Administrative Agent for
the benefit of the Lenders.

5.   MISCELLANEOUS.

     (a)  Until payment in full of all the Senior Indebtedness, the Obligor
and the Holder agree that no amendment shall be made to either of the
Subordinated Notes which would affect the rights of the holders of the Senior
Indebtedness.

     (b)  This Agreement may not be amended or modified in any respect, nor
may any of the terms or provisions hereof be waived, except by an instrument
signed by the Obligor, the Holder and the Administrative Agent.

     (c)  This Agreement shall be binding upon each of the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
Administrative Agent and each and every holder of Senior Indebtedness and
their respective successors and assigns.

     (d)  This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.

     (e)  The Holder and the Obligor each hereby irrevocably agrees that any
suits, actions or proceedings arising out of or in connection with this
Agreement may be brought in any state or federal court sitting in The City of
New York or any court in the Province of Quebec and submits and attorns to
the non-exclusive jurisdiction of each such court.

     (f)  The Holder and the Obligor will whenever and as often as reasonably
requested to do so by the Administrative Agent, do, execute, acknowledge and
deliver any and all such other and further acts, assignments, transfers and
any instruments of further assurance, approvals and consents as are necessary
or proper in order to give complete effect to this Agreement.

     (g)  Each of the Holder and the Obligor irrevocably appoints CT
Corporation System, as its authorized agent in the State of New York upon
which process may be served in any such suit or proceedings, and agrees that
service of process upon such agent, and written notice of said service to CT
Corporation System, by the person serving the same to the addresses listed
below,



                                      (6)

shall be deemed in every respect effective service of process upon the Holder
or the Obligor, as applicable, in any such suit or proceeding.

         If to the Obligor:

         -

         If to the Holder:

         -

         Each of the Holder and the Obligor further agrees to take any and
all action as may be necessary to maintain such designation and appointment
of such agent in full force and effect for a period of ten years from the
date of this Agreement.

         IN WITNESS WHEREOF, the Obligor and the Holder each have caused this
Agreement to be duly executed.

                                                -

                                                by   ___________________________
                                                     Name:     |X|
                                                     Title:    |X|

                                                -

                                                by   ___________________________
                                                     Name:     |X|
                                                     Title:    |X|





                                   SCHEDULE 9

                                  FORM OF NOTE

FOR VALUE RECEIVED, the undersigned (the "BORROWER"), hereby promises to pay
to _____________________ or registered assigns (the "LENDER"), in accordance
with the provisions of the Credit Agreement (as hereinafter defined), the
principal amount of each Accommodation from time to time made by the Lender
to the Borrower under that certain Credit Agreement, dated as of February 7,
2003 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the "CREDIT AGREEMENT;" the terms defined therein
being used herein as therein defined), among the Borrower, the Lenders from
time to time party thereto, and Bank of America, N.A., as Administrative
Agent, Issuing Lender and Swing Line Lender.

The Borrower promises to pay interest on the unpaid principal amount of each
Accommodation from the date of such Accommodation until such principal amount
is paid in full, at such interest rates and at such times as provided in the
Credit Agreement. All payments of principal and interest shall be made to the
Administrative Agent for the account of the Lender in US Dollars in
immediately available funds at the Administrative Agent's Office. If any
amount is not paid in full when due hereunder, such unpaid amount shall bear
interest, to be paid upon demand, from the due date thereof until the date of
actual payment (and before as well as after judgment) computed at the per
annum rate set forth in the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement, is
entitled to the benefits thereof and may be prepaid in whole or in part
subject to the terms and conditions provided therein. This Note is also
entitled to the benefit of all guarantees and is secured by the Security.
Upon the occurrence and continuation of one or more of the Events of Default
specified in the Credit Agreement, all amounts then remaining unpaid on this
Note shall become, or may be declared to be, immediately due and payable all
as provided in the Credit Agreement. Loans made by the Lender shall be
evidenced by one or more loan accounts or records maintained by the Lender in
the ordinary course of business. The Lender may also attach schedules to this
Note and endorse thereon the date, amount and maturity of its Loans and
payments with respect thereto.

The Borrower, for itself, its successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonour and non-payment of this Note.

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE PROVINCE OF ONTARIO

                                             SUN MEDIA CORPORATION



                                             By: _______________________________

                                             Name: _____________________________

                                             Title: ____________________________




                             DISCLOSURE SCHEDULES

                               SCHEDULE 6.01(J)

                 REAL PROPERTY OF LOAN PARTIES TO BE MORTGAGED

- -        8550 Franklin Avenue, Fort McMurray, Alberta

- -        10009-100 Ave., Peace River, Alberta

- -        104 Macleod Ave., Hinton, Alberta

- -        228 Pembina Avenue, Lot D. Blk 3, Plan-2284KS, Hinton, Alberta

- -        4903-49 Ave. Camrose, Alberta

- -        10604-100 Street, Grande Prairie, Alberta

- -        4504-61 Avenue, Leduc, Alberta

- -        5006-50 Street, Stony Plain, Alberta

- -        4732-50 Avenue, Whitecourt, Alberta

- -        5104-53 Avenue, Wetaskiwin, Alberta

- -        5022-50th Street, Lacombe, Alberta

- -        5217-55 Street, Cold Lake, Alberta

- -        4917-50th Avenue, Vermillion, Alberta

- -        694 Goderich Street, Port Elgin, Ontario

- -        976 Erie Street, Stratford, Ontario

- -        573 Berford Street, Wiarton, Ontario

- -        23 King Street West, Brockville, Ontario

- -        31 Broad Street, Brockville, Ontario

- -        13343-20 Avenue Box 1019, Blairmore, Alberta

- -        136 Second Avenue, Strathmore, Alberta

- -        402 West Third Street, Revelstoke, British Columbia

- -        2129-20 Street, Nanton, Alberta



                                      -2-

- -        503-13th St., Invermere, British Columbia

- -        618 Center St. South, High River, Alberta

- -        211 Centre Street, Vulcan, Alberta

- -        York & Colbourne, London, Ontario

- -        214 McCrea Drive, Hanna, Alberta

- -        5714-44th Street, Lloydminster, Alberta

- -        10018-106 Avenue, Grande Prairie, Alberta




                                SCHEDULE 7.01(a)

                   JURISDICTION OF INCORPORATION OR CONTINUATION



- ------------------------------------------------------------------------- --------------------------------------------
                                                                       
                                  NAME                                           JURISDICTION OF INCORPORATION
                                                                                        OR ORGANIZATION
- ------------------------------------------------------------------------- --------------------------------------------
Sun Media Corporation                                                     Continued and existing under the laws of
                                                                          British Columbia
- ------------------------------------------------------------------------- --------------------------------------------
Bowes Publishers Limited                                                  Continued and existing under the laws of
                                                                          British Columbia
- ------------------------------------------------------------------------- --------------------------------------------
Sun Media (Toronto) Corporation                                           Continued and existing under the laws of
                                                                          British Columbia
- ------------------------------------------------------------------------- --------------------------------------------
SMC Nomineeco Inc.                                                        Ontario
- ------------------------------------------------------------------------- --------------------------------------------
3661458 Canada Inc.                                                       Canada
- ------------------------------------------------------------------------- --------------------------------------------
Toronto Sun International, Inc.                                           Delaware
- ------------------------------------------------------------------------- --------------------------------------------
T.S. Printing, Inc.                                                       Delaware
- ------------------------------------------------------------------------- --------------------------------------------
Florida Sun Publications, Inc.                                            Delaware
- ------------------------------------------------------------------------- --------------------------------------------
3351611 Canada Inc.                                                       Canada
- ------------------------------------------------------------------------- --------------------------------------------





                                SCHEDULE 7.01(g)

                                     PART I
                                     ------

                               LOCATION OF BUSINESS


- ------------------------------------------------------------------------- --------------------------------------------
                                                                       
                                  NAME                                                   JURISDICTIONS
- ------------------------------------------------------------------------- --------------------------------------------
Sun Media Corporation                                                     Ontario, Alberta, Quebec, Manitoba,
                                                                          New Brunswick
- ------------------------------------------------------------------------- --------------------------------------------
Bowes Publishers Limited                                                  Ontario, Alberta, Manitoba,
                                                                          British Columbia, Saskatchewan
- ------------------------------------------------------------------------- --------------------------------------------
Sun Media (Toronto) Corporation                                           Ontario
- ------------------------------------------------------------------------- --------------------------------------------
SMC Nomineeco Inc.                                                        Ontario
- ------------------------------------------------------------------------- --------------------------------------------
3661458 Canada Inc.                                                       Ontario
- ------------------------------------------------------------------------- --------------------------------------------
Toronto Sun International, Inc.                                           Florida
- ------------------------------------------------------------------------- --------------------------------------------
T.S. Printing, Inc.                                                       Florida
- ------------------------------------------------------------------------- --------------------------------------------
Florida Sun Publications, Inc.                                            Florida
- ------------------------------------------------------------------------- --------------------------------------------
3351611 Canada Inc.                                                       Quebec, Ontario
- ------------------------------------------------------------------------- --------------------------------------------





                                      - 2 -

                                     PART II
                                     -------

                              LOCATION OF MINUTE BOOKS


- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
                                                                                          
       NAME OF SUBSIDIARY             HEAD OFFICE / REGISTERED         CHIEF EXECUTIVE OFFICE               MINUTE BOOKS
                                               OFFICE
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
Sun Media Corporation              800 Park Place                  333 King Street East            800 Park Place
                                   666 Burrard Street              Toronto, ON                     666 Burrard Street
                                   Vancouver, BC                   M5A 3X5                         Vancouver, B.C.
                                   V6C 3P3                                                         V6C 3P3
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
3661458 Canada Inc.                333 King Street East            333 King Street East            300 Viger Avenue
                                   Toronto, ON                     Toronto, ON                     Montreal, QC
                                   M5A 3X5                         M5A 3X5                         H2X 2W4
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
3351611 Canada Inc.                300 Viger Avenue                333 King Street East            300 Viger Avenue
                                   Montreal, QC                    Toronto, ON                     Montreal, QC
                                   H2X 2W4                         M5A 3X5                         H2X 2W4
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
SMC Nomineeco Inc.                 333 King Street East            333 King Street East            300 Viger Avenue
                                   Toronto, ON                     Toronto, ON                     Montreal, QC
                                   M5A 3X5                         M5A 3X5                         H2X 2W4
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
Bowes Publishers Limited           800 Park Place                  333 King Street East            800 Park Place
                                   666 Burrard Street              Toronto, ON                     666 Burrard Street
                                   Vancouver, BC                   M5A 3X5                         Vancouver, B.C.
                                   V6C 3P3                                                         V6C 3P3
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
Sun Media (Toronto) Corporation    800 Park Place                  333 King Street East            800 Park Place
                                   666 Burrard Street              Toronto, ON                     666 Burrard Street
                                   Vancouver, BC                   M5A 3X5                         Vancouver, B.C.
                                   V6C 3P3                                                         V6C 3P3
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
Toronto Sun International, Inc.    717 First Street East           333 King Street East            555 - 12th Street N.W.
                                   Brandenton, Florida             Toronto, ON                     Washington, D.C.
                                   34208                           M5A 3X5                         20004-1202
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
T.S. Printing, Inc.                717 First Street East           333 King Street East            555 - 12th Street N.W.
                                   Brandenton, Florida             Toronto, ON                     Washington, D.C.
                                   34208                           M5A 3X5                         20004-1202
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------
Florida Sun Publications, Inc.     717 First Street East           333 King Street East            555 - 12th Street N.W.
                                   Brandenton, Florida             Toronto, ON                     Washington, D.C.
                                   34208                           M5A 3X5                         20004-1202
- ---------------------------------- ------------------------------- ------------------------------- -------------------------------





                               SCHEDULE 7.01(I)

                            INTELLECTUAL PROPERTY



                                 SEE ATTACHED.




- --------------------------------------------------------------------------------
                             SUN MEDIA CORPORATION
                             NEWSPAPERS TRADEMARKS
- --------------------------------------------------------------------------------



- -----------------------------------------------------------------------------------------------------------------------------------
                                                          - DATE ET NUMERO DE DEPOT
                               NOM DU PROPRIETAIRE        - DATE ET NUMERO                  REPRESENTANT POUR          MARCHANDISES
MARQUE DE COMMERCE               OU DU REQUERANT            D'ENREGISTREMENT                  SIGNIFICATION              SERVICES
                                                          - DATE DE RENOUVELLEMENT
===================================================================================================================================
                                                                                                           
                                                          Dep.     28 aout 84                                          Journaux
                                                          TMO      527585
LE JOURNAL DE MONTREAL        Corporation Sun Media       Enr.     11 sept. 87           Swabey Ogilvy Renault
                                                          TMA      331770
                                                          Ren.     11 sept. 2017
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     28 aout 84                                          journaux
                                                          TMO      527584
LE JOURNAL DE                 Corporation Sun Media       Enr.     09 janvier 87         Swabey Ogilvy Renault
MONTREAL & DESSIN                                         TMA      322574
                                                          Ren.     09 janvier 2017
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     16 aout 93                                          journaux
                                                          TMO      735242
LE JOURNAL DE QUEBEC          Corporation Sun Media       Enr.     14 juin 96            Robic
                                                          TMA      459245
                                                          Ren.     14 juin 2011
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     16 aout 93                                          journaux
                                                          TMO      735240
LE JOURNAL DE                 Corporation Sun Media       Enr.     14 oct. 94            Robic
QUEBEC & DESSIN                                           TMA      434519
                                                          Ren.     14 oct. 2009
- -----------------------------------------------------------------------------------------------------------------------------------



                                       - 2 -


- -----------------------------------------------------------------------------------------------------------------------------------
                                                          - DATE ET NUMERO DE DEPOT
                               NOM DU PROPRIETAIRE        - DATE ET NUMERO                  REPRESENTANT POUR          MARCHANDISES
MARQUE DE COMMERCE               OU DU REQUERANT            D'ENREGISTREMENT                  SIGNIFICATION              SERVICES
                                                          - DATE DE RENOUVELLEMENT
===================================================================================================================================
                                                                                                           
                                                          Dep.     8 aout 78                                           Periodical
                                                          TMO      428256                                              publications
THE CALGARY SUN               Corporation Sun Media       Enr.     12 septembre 80       Goodmans LLP
                                                          TMA      250371
                                                          Ren.     12 septembre 2010
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     18 juillet 80                                       Periodical
                                                          TMO      456366                                              publications
THE CALGARY SUN & DESIGN      Corporation Sun Media       Enr.     28 janvier 83         Goodmans LLP
                                                          TMA      276154
                                                          Ren.     28 janvier 2013
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     2 novembre 77                                       Periodical
                                                          TMO      417211                                              publications
THE EDMONTON SUN              Corporation Sun Media       Enr.     23 novembre 79        Goodmans LLP
                                                          TMA      237431
                                                          Ren.     23 novembre 2009
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     14 novembre 77                                      Periodical
                                                          TMO      0417594                                             publications
THE EDMONTON SUN & DESIGN     Corporation Sun Media       Enr.     19 octobre 1979       Goodmans LLP
                                                          TMA      236763
                                                          Ren.     19 octobre 2009
- -----------------------------------------------------------------------------------------------------------------------------------

THE LONDON FREE PRESS         Corporation Sun Media       Not Registered

- -----------------------------------------------------------------------------------------------------------------------------------



                                       - 3 -


- -----------------------------------------------------------------------------------------------------------------------------------
                                                          - DATE ET NUMERO DE DEPOT
                               NOM DU PROPRIETAIRE        - DATE ET NUMERO                  REPRESENTANT POUR          MARCHANDISES
MARQUE DE COMMERCE               OU DU REQUERANT            D'ENREGISTREMENT                  SIGNIFICATION              SERVICES
                                                          - DATE DE RENOUVELLEMENT
===================================================================================================================================
                                                                                                           

                                                          Dep.     29 juillet 88                                       Periodical
                                                          TMO      612285                                              publications
THE OTTAWA SUN                Corporation Sun Media       Enr.     16 mars 90            Goodmans LLP
                                                          TMA      366894
                                                          Ren.     16 mars 2005
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     2 janvier 1990                                     Periodical
                                                          TMO      0647937                                            publications;
THE OTTAWA SUN & DESIGN       Corporation Sun Media       Enr.     12 juillet 1991       Goodmans LLP                 accessories
                                                          TMA      386601
                                                          Ren.     12 juillet 2006
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     10 avril 78                                         Periodical
                                                          TMO      423238                                              publications
THE TORONTO SUN & DESIGN      Corporation Sun Media       Enr.     25 janvier 80         Goodmans LLP
                                                          TMA      239437
                                                          Ren.     25 janvier 2010
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     10 avril 78                                         Periodical
                                                          TMO      423240                                              publications
THE TORONTO SUN & DESIGN      Corporation Sun Media       Enr.     1er fevrier 80        Goodmans LLP
                                                          TMA      239586
                                                          Ren.     1er fevrier 2010
- -----------------------------------------------------------------------------------------------------------------------------------
                                                          Dep.     11 oct. 95                                          Journal
                                                          TMO      794585                                              quotidien
THE WINNIPEG SUN              Corporation Sun Media       Enr.     21 mars 97            Robic
                                                          TMA      473276
                                                          Ren.     21 mars 2012
- -----------------------------------------------------------------------------------------------------------------------------------



                                SCHEDULE 7.01(j)

                                OWNED PROPERTIES


- ------------------------------------------------------------ ---------------------------------------------------------
                                                          
                           NAME                                                      ADDRESS
- ------------------------------------------------------------ ---------------------------------------------------------
Sun Media Corporation                                        Eastgate Industrial Park
                                                             93000 - 47 Street
                                                             Plan 7820294 Block 8 Lot 1
                                                             Edmonton, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             Eastgate Industrial Park
                                                             93000 - 47 Street
                                                             Plan 7820294 Block 8 Lot 2
                                                             Edmonton, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             Eastgate Industrial Park
                                                             Plan 7820294 Block 9 Lot 4
                                                             Edmonton, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             11260 - 228 Street West
                                                             Plan 8021483 Block 5 Lot 7
                                                             Edmonton, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             2615 - 12 Street NE
                                                             Calgary, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             369 York Street
                                                             London, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             425 York Street
                                                             London, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             York & Colbourne
                                                             London, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             4080 Belgreen Drive
                                                             Ottawa, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             4545 Frontenac
                                                             Montreal, Quebec
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             450 Bechard
                                                             Vanier, Quebec
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             1700 Church Avenue
                                                             Winnipeg, Manitoba
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             365 Boulevard Laure
                                                             Sept-Iles, Quebec
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             12625 - 1(ere) avenue
                                                             St-Georges, Beauce, Quebec
- ------------------------------------------------------------ ---------------------------------------------------------




                                     - 2 -



- ------------------------------------------------------------ ---------------------------------------------------------
                                                          
                           NAME                                                      ADDRESS
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             3388 Boul. St-Francois
                                                             Jonquiere, Quebec
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             16 du Domaine
                                                             Riviere-du-Loup, Quebec
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             23 King Street West
                                                             Brockville, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             31 Broad Street
                                                             Brockville, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
Bowes Publishers Limited                                     1147 Gainsborough Road
                                                             London, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             33 Main Street South
                                                             Kenora, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             8550 Franklin Ave.
                                                             Fort McMurray, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             10009-100 Ave.
                                                             Peace River, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             104 Macleod Ave.
                                                             Hinton, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             228 Pembina Ave.
                                                             Lot D, Blk 3, Plan-2284KS
                                                             Hinton, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             4903-49 Ave.
                                                             Camrose, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             10604-100 Street
                                                             Grande Prairie, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             10018-106 Avenue
                                                             Grande Prairie, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             4504-61 Avenue
                                                             Leduc, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             5006-50 Street
                                                             Stony Plain, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             4732-50 Avenue
                                                             Whitecourt, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             1941 Sask. Ave. West
                                                             Portage La Prairie, Manitoba
- ------------------------------------------------------------ ---------------------------------------------------------




                                     - 3 -



- ------------------------------------------------------------ ---------------------------------------------------------
                                                          
                           NAME                                                      ADDRESS
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             20th Street SW
                                                             Portage La Prairie, Manitoba
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             8 Front Street East
                                                             Strathroy, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             59 Grand River St. North
                                                             Paris, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             2250 Camrose St
                                                             Penticton, B.C.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             5104-53 Avenue
                                                             Wetaskiwin, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             238 Dalhousie Street
                                                             Amherstburg, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             13266 North Victoria Street
                                                             Summerland, B.C.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             218 Centre St. S
                                                             Nipawin, Sask.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             14-16-18 Hincks Street
                                                             St. Thomas, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             27 Princess Street
                                                             Leamington, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             5022  50th Street
                                                             Lacombe, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             5217-55 Street
                                                             Cold Lake, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             214 McCrea Drive
                                                             Hanna, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             5714-44th Street
                                                             Lloydminster, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             4917-50th Avenue
                                                             Vermilion, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             311 Centre Street
                                                             Meadow Lake, Sask.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             120 Huckins Street
                                                             Industrial Park
                                                             Goderich, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------




                                     - 4 -



- ------------------------------------------------------------ ---------------------------------------------------------
                                                          
                           NAME                                                      ADDRESS
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             23 Albert Street
                                                             (also known as 53 Albert Street)
                                                             Clinton, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             42 Montreal Street
                                                             Mitchell, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             617 Campbell Street
                                                             (also known as 619 Campbell Street)
                                                             Lucknow, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             694 Goderich Street
                                                             Port Elgin, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             21 Elgin Street
                                                             St. Thomas, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             815 Pine Street South
                                                             Timmins, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             51 Riverside Drive
                                                             Kapuskasing, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             976 Erie Street
                                                             Stratford, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             573 Berford Street
                                                             Wiarton, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             13343  20 Avenue Box 1019
                                                             Blairmore, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             136 Second Avenue
                                                             Strathmore, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             402 West Third Street
                                                             Revelstoke, B.C.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             404 West Third Street
                                                             Revelstoke, B.C.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             406 West Third Street
                                                             Revelstoke, B.C.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             2129  20 Street
                                                             Nanton, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             503  13 St.
                                                             Invermere, B.C.
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             618 Center St. South
                                                             High River, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------




                                     - 5 -



- ------------------------------------------------------------ ---------------------------------------------------------
                                                          
                           NAME                                                      ADDRESS
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             211 Centre Street
                                                             Vulcan, Alberta
- ------------------------------------------------------------ ---------------------------------------------------------
Sun Media (Toronto) Corporation                              Nil
- ------------------------------------------------------------ ---------------------------------------------------------
SMC Nomineeco Inc.                                           333 King Street East
                                                             Toronto, Ontario
- ------------------------------------------------------------ ---------------------------------------------------------
3661458 Canada Inc.                                          Nil
- ------------------------------------------------------------ ---------------------------------------------------------
Toronto Sun International, Inc.                              Nil
- ------------------------------------------------------------ ---------------------------------------------------------
Florida Sun Publications, Inc.                               Nil
- ------------------------------------------------------------ ---------------------------------------------------------
T.S. Printing, Inc.                                          717  1st Street East
                                                             Bradenton, Florida
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             118-6th Avenue East
                                                             Bradenton, Florida
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             3755 South Tuttle Avenue
                                                             Sarasota, Florida
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             1010 U.S. Highway 27 North
                                                             Sebring, Florida
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             108 Church Street
                                                             Kissimmee, Florida
- ------------------------------------------------------------ ---------------------------------------------------------
                                                             116-6th Avenue East
                                                             Bradenton, Florida
- ------------------------------------------------------------ ---------------------------------------------------------
3351611 Canada Inc.                                          Nil
- ------------------------------------------------------------ ---------------------------------------------------------





                                SCHEDULE 7.01(k)

                                LEASED PROPERTIES


- -------------------- -------------------------------------------------------------------------------------------------
                  
                                                              ADDRESS
- -------------------- -------------------------------------------------------------------------------------------------
        1.           #250, 4990  92 Avenue, Edmonton Alberta
- -------------------- -------------------------------------------------------------------------------------------------





                                SCHEDULE 7.01(o)

                               MINORITY INTERESTS

In addition to the shares held by the Borrower in certain Guarantors, the
Borrower also holds shares or other interests in the following Persons:



- ------------------------------------------------------------------------ --------------------------------------------
                                                                      
                                 NAME                                                  PERCENTAGE HELD
- ------------------------------------------------------------------------ --------------------------------------------
Le Courrier du Sud (1998) Inc.                                                             50.01%
- ------------------------------------------------------------------------ --------------------------------------------
Dynamic Press Group Partnership                                                              50%
- ------------------------------------------------------------------------ --------------------------------------------





                                SCHEDULE 7.01(r)

                                  PENSION PLANS

- -        Sun Media Employees Pension Plan

- -        Retirement Plan for Employees of London Free Press

- -        Bowes Publishers Limited Pension Plan

- -        Pension Plan for Eligible Employees of the Stratford Beacon Herald, a
         Division of Bowes Publishers Limited

- -        Supplemental Retirement Arrangements for Nine (9) Senior Executives

- -        Other Related Plans - Non Pension

- -        Targeted Registered Retirement Savings Plan (TRRIP)

- -        Florida Sun Employees 401(K)

       PENSION PLANS OF EMPLOYEES OF DIVISIONS OF QUEBECOR MEDIA INC.

These plans cover all of the employees of all divisions of Quebecor Media Inc.:

- -        Pension plan for the employees of Quebecor Inc. and its subsidiaries
         (unionized employees)

- -        Pension plan for the employees of Quebecor Inc. and its subsidiaries
         which are not subject to a collective bargaining agreement

These plans cover exclusively the employees of Journal de Montreal:

- -        Pension plan for the employees who are members of the Syndicat des
         Travailleurs de l'Information du Journal de Montreal

- -        Supplementary retirement plan for the preparation and shipping
         employees of Journal de Montreal (a division of Communications
         Quebecor Inc.) who are unionized

- -        Supplementary retirement plan for the unionized employees providing
         press services for the printing of Journal de Montreal, a division of
         Communications Quebecor Inc.




                                SCHEDULE 7.01(s)

                               MATERIAL AGREEMENTS

- -        Newsprint Purchase Agreement dated January 1, 2000 between Produits
         Forestiers Donohue Inc., Sun Media Corporation and Imprimerie
         Quebecor Inc.

- -        Purchase of Computer-to-Plate Equipment agreement between Agfa and
         Sun Media Corporation [NOT EXECUTED]

- -        Purchase of Colour Units agreement dated October 10, 2002 between
         le Journal de Montreal, a division of Sun Media Corporation, and
         Printing Press Services International Ltd.




                                SCHEDULE 7.01(y)

                               CORPORATE STRUCTURE

(i)      Shareholders of the Borrower

         Please see attached.

(ii)     Unanimous Shareholders or Other Agreements Relating to Shares Owned by
         Such Shareholders

         Nil.





[QUEBECOR MEDIA INC. CHART]

EX-10.5

                                                                    EXHIBIT 10.5



                           SUBORDINATION AGREEMENT FOR
                        EXISTING BACK-TO-BACK SECURITIES

This SUBORDINATION AGREEMENT is dated as of February 7, 2003 (the "Agreement").

To:      Bank of America, N.A., for itself and as Administrative Agent under the
         Credit Agreement (defined below) for the Lenders (the "ADMINISTRATIVE
         AGENT")

                  Sun Media Corporation, a British Columbia company (the
"OBLIGOR"), as obligor under the convertible obligations dated as of July 9,
2001 and November 28, 2002 in the principal amount of Cdn.$1,600,000,000 and
Cdn$350,000,000, respectively, made by the Obligor in favour of Quebecor Media
Inc. (the "SUBORDINATED NOTES"), and Quebecor Media Inc., as holder (the
"HOLDER") of the Subordinated Notes, for ten dollars and other good and valuable
consideration received by each of the Obligor and the Holder from the
Administrative Agent and by each of the Obligor and the Holder from the other,
agree as follows:

1.       INTERPRETATION.

   (a)   "CASH, PROPERTY OR SECURITIES". "Cash, Property or Securities" shall
not be deemed to include securities of the Obligor or any other Person provided
for by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided herein with respect to the
Subordinated Notes, to the payment of all Senior Indebtedness which may at the
time be outstanding; provided, however, that (i) all Senior Indebtedness is
assumed by the new Person, if any, resulting from any such reorganization or
readjustment, and (ii) the rights of the holders of the Senior Indebtedness are
not, without the consent of such holders, altered by such reorganization or
readjustment.

   (b)   "PAYMENT IN FULL". "payment in full", with respect to Senior
Indebtedness, means the receipt on an irrevocable basis of cash in an amount
equal to the unpaid principal amount of the Senior Indebtedness and premium, if
any, and interest and any special interest thereon to the date of such payment,
together with all other amounts owing with respect to such Senior Indebtedness.

   (c)   "SENIOR INDEBTEDNESS". "Senior Indebtedness" means, at any date all
indebtedness (including, without limitation, any and all amounts of principal,
interest, special interest, additional amounts, premium, fees, penalties,
indemnities and "post-petition interest" in bankruptcy and any reimbursement of
expenses) under (1) the Indenture , including, without limitation, the "Notes",
the "Subsidiary Guarantees", the "Exchange Notes", the "Additional Notes" and
any Guarantee of the Exchange Notes or the Additional Notes (in each case, as
defined in the Indenture) and (2) the Credit Agreement, dated as of February 7,
2003, among the Obligor, the financial institutions identified as lenders
therein, Banc of America Securities LLC, as joint lead arranger, Bank of
America, N.A., as administrative agent, and Credit Suisse First Boston
Corporation, as joint lead arranger and syndication agent (the "CREDIT
AGREEMENT"; capitalized terms used herein without definition having the meanings
set forth therein).





                                     - 2 -


2.       AGREEMENT ENTERED INTO PURSUANT TO CREDIT AGREEMENT. The Obligor, the
Administrative Agent and the Lenders are entering into this Agreement pursuant
to the provisions of the Credit Agreement , pursuant to which the Obligor has
borrowed US$230,000,000 and has additional borrowings available of
Cdn.$75,000,000 (the "ACCOMMODATIONS").

3.       SUBORDINATION. The indebtedness represented by the Subordinated Notes
shall be subordinated as follows:

   (a)   AGREEMENT TO SUBORDINATE. The Obligor, for itself and its successors
and assigns, and the Holder agree that the indebtedness evidenced by the
Subordinated Notes (including, without limitation, principal, interest, premium,
fees, penalties, indemnities and "post-petition interest" in bankruptcy and any
reimbursement of expenses) is subordinate and junior in right of payment, to the
extent and in the manner provided in this Section 3, to the prior payment in
full of all Senior Indebtedness. The provisions of this Section 3 are for the
benefit of the Administrative Agent acting on behalf of the holders from time to
time of Senior Indebtedness under the Credit Agreement, and such holders are
hereby made obligees hereunder to the same extent as if their names were written
herein as such, and they (collectively or singly) may proceed to enforce such
provisions.

   (b)   LIQUIDATION, DISSOLUTION OR BANKRUPTCY.

         (i)      Upon any distribution of assets of the Obligor to creditors or
                  upon a liquidation or dissolution or winding-up of the Obligor
                  or in a bankruptcy, arrangement, liquidation, reorganization,
                  insolvency, receivership or similar case or proceeding
                  relating to the Obligor or its property or other marshalling
                  of assets of the Obligor:

                  (A)      the holders of Senior Indebtedness shall be entitled
                           to receive payment in full of all Senior Indebtedness
                           before the Holder shall be entitled to receive any
                           payment of principal of or interest on, or any other
                           amount owing in respect of, the Subordinated Notes;

                  (B)      until payment in full of all Senior Indebtedness, any
                           distribution of assets of the Obligor of any kind or
                           character to which the Holder would be entitled but
                           for this Section 3 is hereby assigned to the holders
                           of Senior Indebtedness absolutely and shall be paid
                           by the Obligor or by any receiver, trustee in
                           bankruptcy, liquidating trustee, agents or other
                           Persons making such payment or distribution to, the
                           Administrative Agent behalf of the holders of Senior
                           Indebtedness under the Credit Agreement, as their
                           interests may appear; and

                  (C)      in the event that, notwithstanding the foregoing, any
                           payment or distribution of assets of the Obligor of
                           any kind or character, whether in Cash, Property or
                           Securities, shall be received by the Holder before
                           all Senior Indebtedness is paid in full, such payment






                                     - 3 -


                           or distribution shall be held in trust for the
                           benefit of and shall be paid over to the
                           Administrative Agent on behalf of the holders of
                           Senior Indebtedness under the Credit Agreement, as
                           their interests may appear, for application to the
                           payment of all Senior Indebtedness under the Credit
                           Agreement until all such Senior Indebtedness shall
                           have been paid in full after giving effect to any
                           concurrent payment or distribution to the holders of
                           Senior Indebtedness under the Credit Agreement in
                           respect of such Senior Indebtedness.

         (ii)     If (A) a bankruptcy, reorganization, insolvency, receivership
                  or similar proceeding relating to the Obligor or its property
                  (a "REORGANIZATION PROCEEDING") is commenced and is continuing
                  and (B) the Holder does not file proper claims or proofs of
                  claim in the form required in a Reorganization Proceeding
                  prior to 45 days before the expiration of the time to file
                  such claims, then (1) upon the request of the Administrative
                  Agent, the Holder shall file such claims and proofs of claim
                  in respect of the Subordinated Notes and execute and deliver
                  such powers of attorney, assignments and proofs of claim or
                  proxies as may be directed by the Administrative Agent to
                  enable it to exercise in the sole discretion of the
                  Administrative Agent any and all voting rights attributable to
                  the Subordinated Notes which are capable of being voted
                  (whether by meeting, written resolution or otherwise) in a
                  Reorganization Proceeding and enforce any and all claims upon
                  or in respect of the Subordinated Notes and to collect and
                  receive any and all payments or distributions which may be
                  payable or deliverable at any time upon or in respect of the
                  Subordinated Notes, and (2) whether or not the Administrative
                  Agent shall take the action described in clause (1) above, the
                  Administrative Agent shall nevertheless be deemed to have such
                  powers of attorney as may be necessary to enable the
                  Administrative Agent to exercise such voting rights, file
                  appropriate claims and proofs of claim and otherwise exercise
                  the powers described above for and on behalf of the Holder.

   (c)   SUBROGATION. After all Senior Indebtedness is paid in full and until
the Subordinated Notes are paid in full, the Holder shall be subrogated to the
rights of the holders of Senior Indebtedness. For purposes of this Section 3(c),
a distribution made under this Section 3 to holders of Senior Indebtedness which
otherwise would have been made to the Holder, or a payment made by the Holder to
holders of Senior Indebtedness in respect of a turnover obligation under this
Section 3, is not, as between the Obligor and such holder, a payment by the
Obligor on Senior Indebtedness.

   (d)   RELATIVE RIGHTS. This Section 3 defines the relative rights of the
Holder and the holders of Senior Indebtedness. Nothing in this Section 3 shall:

         (i)      impair, as between the Obligor and the Holder, the obligation
                  of the Obligor, which is absolute and unconditional, to pay
                  the principal of and interest on the Subordinated Notes in
                  accordance with their terms; or





                                     - 4 -


         (ii)     affect the relative rights of the Holder and creditors of the
                  Obligor other than the holders of Senior Indebtedness; or

         (iii)    affect the relative rights of the holders of Senior
                  Indebtedness among themselves or opposite the Obligor under
                  the Credit Documents; or

         (iv)     prevent the Holder from exercising its available remedies upon
                  a default, subject to the rights of the holders of Senior
                  Indebtedness to receive cash, property or other assets
                  otherwise payable to the Holder.

   (e)   SUBORDINATION MAY NOT BE IMPAIRED.

         (i)      No right of any holder of Senior Indebtedness to enforce the
                  subordination of indebtedness evidenced by the Subordinated
                  Notes shall in any way be prejudiced or impaired by any act or
                  failure to act by the Obligor or by any such holder or the
                  Administrative Agent, or by any non-compliance by the Obligor
                  with the terms, provisions or covenants herein, regardless of
                  any knowledge thereof which any such holder or the
                  Administrative Agent may have or be otherwise charged with.
                  Neither the subordination of the Subordinated Notes as herein
                  provided nor the rights of the holders of Senior Indebtedness
                  with respect hereto shall be affected by any extension,
                  renewal or modification of the terms, or the granting of any
                  security in respect of, any Senior Indebtedness or any
                  exercise or non-exercise of any right, power or remedy with
                  respect thereto.

         (ii)     The Holder agrees that all indebtedness evidenced by the
                  Subordinated Notes will be unsecured by any Lien upon or with
                  respect to any property of the Obligor.

         (iii)    The Holder agrees not to exercise any offset or counterclaim
                  or similar right in respect of the indebtedness evidenced by
                  the Subordinated Notes except to the extent payment of such
                  indebtedness is permitted and will not assign or otherwise
                  dispose of the Subordinated Notes or the indebtedness which it
                  evidences unless the assignee or acquiror, as the case may be,
                  agrees to be bound by the terms of this Agreement.

   (g)   HOLDER ENTITLED TO RELY.

         Upon any payment or distribution pursuant to this Section 3, the Holder
         shall be entitled to rely (i) upon any order or decree of a court of
         competent jurisdiction in which any proceedings of the nature referred
         to in Section 3(b) are pending, (ii) upon a certificate if the
         liquidating trustee or agent or other person in such proceedings making
         such payment or distribution to the Holder or its representative, if
         any, or (iii) upon a certificate of the Administrative Agent or any
         representative (if any) of the holders of Senior Indebtedness for the
         purpose of ascertaining the persons entitled to participate in such
         payment or distribution, the holders of the Senior Indebtedness and
         other indebtedness of the Obligor, the





                                     - 5 -


         amount thereof or payable thereon, the amount or amounts paid or
         distributed thereon and all other facts pertinent thereto or to this
         Section 3.

4.       ENFORCEABILITY. Each of the Obligor and the Holder represents and
warrants that this Agreement has been duly authorized, executed and delivered by
each of the Obligor and the Holder and constitutes a valid and legally binding
obligation of each of the Obligor and the Holder, enforceable in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles; and on the date
hereof, the Holder shall deliver an opinion or opinions of counsel to such
effect to the Administrative Agent for the benefit of the Lenders.

5.       MISCELLANEOUS.

   (a)   Until payment in full of all the Senior Indebtedness, the Obligor and
the Holder agree that no amendment shall be made to either of the Subordinated
Notes which would affect the rights of the holders of the Senior Indebtedness.

   (b)   This Agreement may not be amended or modified in any respect, nor may
any of the terms or provisions hereof be waived, except by an instrument signed
by the Obligor, the Holder and the Administrative Agent.

   (c)   This Agreement shall be binding upon each of the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
Administrative Agent and each and every holder of Senior Indebtedness and their
respective successors and assigns.

   (d)   This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.

   (e)   The Holder and the Obligor each hereby irrevocably agrees that any
suits, actions or proceedings arising out of or in connection with this
Agreement may be brought in any state or federal court sitting in The City of
New York or any court in the Province of Quebec and submits and attorns to the
non-exclusive jurisdiction of each such court.

   (f)   The Holder and the Obligor will whenever and as often as reasonably
requested to do so by the Administrative Agent, do, execute, acknowledge and
deliver any and all such other and further acts, assignments, transfers and any
instruments of further assurance, approvals and consents as are necessary or
proper in order to give complete effect to this Agreement.

   (g)   Each of the Holder and the Obligor irrevocably appoints CT Corporation
System, as its authorized agent in the State of New York upon which process may
be served in any such suit or proceedings, and agrees that service of process
upon such agent, and written notice of said service to CT Corporation System, by
the person serving the same to the addresses listed below, shall be deemed in
every respect effective service of process upon the Holder or the Obligor, as
applicable, in any such suit or proceeding.

         If to the Obligor:
         Sun Media Corporation





                                     - 6 -


         333 King Street East
         Toronto, Ontario M5A 3XS
         Canada

         If to the Holder:

         Quebecor Media Inc.
         612 Saint-Jacques Street
         Montreal, Quebec H3C 4M8
         Canada

         Each of the Holder and the Obligor further agrees to take any and all
action as may be necessary to maintain such designation and appointment of such
agent in full force and effect for a period of ten years from the date of this
Agreement.



                  IN WITNESS WHEREOF, the Obligor and the Holder each have
caused this Agreement to be duly executed.

                                       SUN MEDIA CORPORATION

                                       by /s/ Mark D'Souza
                                          -------------------------------------
                                          Name:     Mark D'Souza
                                          Title:    Vice President and Treasurer


                                       QUEBECOR MEDIA INC.

                                       by /s/ Mark D'Souza
                                          -------------------------------------
                                          Name:     Mark D'Souza
                                          Title:    Vice President and Treasurer

EX-10.9

                                                                   EXHIBIT 10.9


                              SUN MEDIA CORPORATION
        12.15 % convertible Obligation (< Cancap >) due November 28, 2008

CDN $350,000,000                                               November 28, 2002


FOR VALUE RECEIVED, the undersigned, SUN MEDIA CORPORATION, a company
continued and existing under the COMPANY ACT (British Columbia) (the
< ISSUER >) , hereby promises to pay to QUEBECOR MEDIA INC., a company
organized and existing under the COMPANIES ACT (Quebec), or its assigns (in
each case, the < HOLDER >), the sum of 350,000,000 Canadian Dollars (the
< FACE AMOUNT >) on November 28, 2008, with interests ("COUPON PAYMENTS") on
the unpaid balance thereof at the rate of 12.15 % per annum from the date
hereof. The Coupon Payments shall be payable (subject to Section 2(b) hereof)
semi-annually on January 14 and July 14 of each year (the first Coupon
Payment which shall be of $5,475,821.92 and payable on January 14, 2003, and
the last Coupon Payment which shall be of $15,961,438.36 and payable on
November 28, 2008), until the Face Amount hereof shall become due and payable.

         This 12.15 % Convertible Obligation due November 28, 2008 (together
with any security issued upon transfer or exchange of or in substitution for
this Convertible Obligation, in each case, the < CANCAP >) is an obligation
of the Issuer. The Holder of the Cancap will be deemed, by its acceptance of
such Cancap, to have agreed to all of the provisions thereof.

        1.       DEFINITIONS.  The following are definitions which apply to the
Cancap :

"CREDIT FACILITY" means the amended and restated credit agreement dated as of
April 1, 2000, as amended from time to time, between the Issuer (as borrower),
the financial institutions identified therein (as lenders), Royal Bank of
Canada (as administrative agent) and Credit Suisse First Boston Canada (as
documentation agent).

"CONVERSION PRICE" means the fair market value per share (as defined
hereinafter) at the time of a conversion pursuant to Section 6 hereof, as
determined in good faith by the Board of Directors of the Issuer;

"SHARE PAYMENT PRICE" means the fair market value per Share at the time of a
share payment pursuant to Section 2(c) hereof, as determined in good faith by
the Board of Directors of the Issuer; and

"SHARES" means fully-paid and non-assessable common shares of the capital stock
of the Issuer or its successor, and "SHARE" means one (1) such share.


         2.      (a) CASH PAYMENT. Subject to Sections 2(c) and 6(a), payments
with respect to the Cancap shall be made in lawful money of Canada. Payments due
and payable on the Cancap shall be made, without the presentment or surrender of
any Cancap, by wire transfer or such other method, and at such





address in Canada (the "PLACE OF PAYMENT"), as shall be specified by the Holder
in a notice given at any time and from time to time to the Issuer.

                  (b) PAYMENT DEFERRAL OPTION. The issuer may elect to defer, at
any time and from time to time, Coupon Payments on the Cancap by extending the
Coupon Payment period on the Cancap for a period (each such period, an
"EXTENSION PERIOD") of up to twelve (12) consecutive semi-annual periods;
provided, however, that no Extension period may extend beyond November 28, 2008.

                  (c) SHARE PAYMENT OPTION. The Issuer may at any time, at its
option, elect to satisfy its obligation to pay deferred semi-annual and the
final Coupon Payment amounts by issuing and delivering to the Holder, for each
portion of $1,000 of Coupon Payment owed under the Cancap, the number of Shares
obtained by dividing $1,000 by the Share Payment Price.

          3.      OPTIONAL REDEMPTION. The Cancap is redeemable at the option
of the Issuer, in whole at any time or in part from time to time, at a
redemption price equal to the then outstanding Face Amount (or portion thereof
called for redemption, as the case may be), together, in each case, with accrued
and unpaid Coupon Payments, if any, to the redemption date.

         In order to effect an optional redemption, the Issuer shall provide to
the Holder a notice of redemption of at least one (1) business day. On and after
any redemption date, Coupon Payments will cease to accrue on the Cancap or
portion thereof called for redemption.


         4.       MANDATORY REDEMPTION. (A) The  occurrence of any of the
following shall constitute a MANDATORY REDEMPTION EVENT :

                  (1) any failure to pay the Face Amount of the Cancap when due
and payable (whether at maturity or a date fixed for redemption or by
declaration or otherwise);

                  (2)     any failure to pay any Coupon  Payment on the Cancap
when due and payable, which failure continues for a period of thirty (30) days;

                  (3) any failure to perform any other obligation under the
Cancap, which failure continues for more than thirty (30) days after receipt by
the Issuer of a notice from the Holder describing such failure in reasonable
detail;

                  (4) the Issuer (i) admits in writing its inability to pay its
debts as they become due, (ii) files, or consents by answer or otherwise to the
filing against it of, a petition for relief, reorganisation or arrangement or
any other petition in bankruptcy or for liquidation or to take advantage of any
bankruptcy, insolvency, reorganization, moratorium or other similar law of any
jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv)
consents to the appointment of a custodian, receiver, trustee or other officer
with similar powers with respect to it or





any substantial part of its assets or (v) takes corporate action for the purpose
of the foregoing; or

                  (5) a court or other governmental authority of competent
jurisdiction enters an order (i) appointing a custodian, receiver, trustee or
other officer with similar powers with respect to the Issuer or any substantial
part of its assets, (ii) for relief or approving a petition for relief,
reorganization or any other petition in bankruptcy or for liquidation of the
Issuer or to take advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction or (iii) for the
dissolution, winding-up or liquidation of the Issuer, or any such petition
shall be filed against the Issuer and not be dismissed within ninety (90) days.

(b) The Cancap is not redeemable at the option of the Holder upon any Mandatory
Redemption Event prior to May 15, 2007. From and after May 15, 2007, the Cancap
is not redeemable at the option of the Holder upon any Mandatory Redemption
Event unless (i) no amounts are outstanding under the Credit Facility, (ii) the
administrative agent under the Credit Facility has already demanded payment of
amounts owing under the Credit Facility, or (iii) if amounts are outstanding
under the Credit Facility, not less than ninety (90) days' advance notice of the
Mandatory Redemption Event has been given to the administrative agent under the
Credit Facility. Subject to the foregoing, if any Mandatory Redemption Event has
occurred and is continuing, the Holder may, by written notice to the Issuer,
declare the Cancap to be immediately due and payable to the Holder. In any such
case, the Cancap will mature, and all amounts payable with respect thereto shall
become immediately due and payable, without presentment, demand, protest or
further notice, all of which are hereby waived.

(c) At any time after the Cancap has been declared immediately due and payable,
the Holder may, by notice to the Issuer, rescind such declaration and its
consequences; PROVIDED THAT (i) no judgment or decree shall have been entered
for the payment of the Cancap by reason of such declaration, (ii) the Issuer
shall have paid all amounts then due and payable (other than by virtue of such
declaration) with respect to the Cancap, and (iii) all non-monetary Mandatory
Redemption Events, if any, shall have been waived by the Holder of shall have
been cured.

5. RANKING. The obligations of the Issuer under the Cancap are subordinated in
right of payment to the prior payment in full of all existing and future
indebtedness of the Issuer. The holders of all other indebtedness of the Issuer
will be entitled to receive payment in full of all amounts due on or in respect
of all other indebtedness of the Issuer before the Holder is entitled to receive
or retain payment of any kind on the Cancap.

6. CONVERTIBILITY. (a) By giving a notice (a "CONVERSION NOTICE") to the Holder
at any time prior to the close of business on November 27, 2008 or the business
day immediately preceding the date of a redemption, as the case may be, the
Issuer may elect to convert all or any part of the unpaid Face Amount and
accrued and unpaid Coupon Payments into Shares at the Conversion Price, the
number of which Shares shall be determined by dividing the amount to be so
converted by the





Conversion Price. Until the Issuer converts any unpaid Face Amount and accrued
and unpaid Coupon Payments to Shares, the Holder shall have under this Section 6
none of the rights or obligations of a shareholder of the Issuer.

(b) RESERVED SHARES; REGISTRATION, LISTING, ETC. The issuer shall reserve (if at
any time its articles limit the number of authorized Shares) and at all times
keep available, solely for the purpose of delivery upon conversion of the Cancap
as provided in this Section 6, such number of Shares as would then be
deliverable at the Conversion Price upon the conversion of the Cancap, which
Shares would be upon delivery duly and validly issued and fully paid and
non-assessable. If any such Shares require registration with or approval of any
governmental authority under any applicable law or listing upon any national
securities exchange before such shares may be issued and delivered upon
conversion, the Issuer shall use its best efforts to cause such Share to be duly
registered, approved and listed, as the case may be.

(c) CONVERSION PROCEDURE. Each Conversion Notice shall specify (a) the unpaid
Face Amount of the Cancap, (b) accrued and unpaid Coupon Payments payable
thereon, (c) the Conversion Price and (d) the number of Shares to be issued and
delivered upon conversion. The Issuer shall, within ten (10) days of sending any
Conversion Notice (or at such later time as to which the Issuer and the Holder
may agree) deliver to the Holder at the Place of Payment, against surrender of
the Cancap owned by the Holder, (i) at the Issuer's expense (including any stamp
taxes or similar governmental charges), the appropriate number of duly and
validly issued and fully paid and non-assessable Shares and one (1) or more
stock certificates therefor (in such number and registered in such names as the
Holder may direct, provided that if Shares are to be registered in the name of a
person other than the Holder, the Holder shall take all steps necessary to
ensure that such registration and any transfer resulting therefrom does not
breach any applicable provision of securities law or stock exchange rule) and
(ii) to the extent of any unpaid Face Amount of the Cancap after giving effect
to such conversion (and at the Issuer's expense), one (1) Cancap (registered in
such name as the Holder may direct) in substantially the form, and in aggregate
face amount equal to the such unpaid Face Amount of, such surrendered Cancap.
Each new Cancap shall be dated the date to which the Coupon Payment shall have
been paid on such surrendered Cancap and future Coupon Payments shall accrue
from such date.

7.       MISCELLANEOUS.

    (a) NOTICES. Except as specifically provided elsewhere herein, notices and
    other communications required or permitted to be given hereunder will be
    effective when in writing and delivered by hand, mail, recognized overnight
    courier or telecopier, addressed as follows or to such other addresses as
    shall be specified by notice :






                       (1)      If to the Issuer :
                                Sun Media Corporation
                                333 King Street East
                                Toronto (Ontario)  M5A 3X5

                                Attention : Vice-President, Corporate Controller

                                Telecopier Number : (416) 947-3119

                       (2)      If to the Holder :
                                Quebecor Media inc.
                                300 Viger Avenue East
                                Montreal (Quebec)  H2X 3W4

                                Attention : Vice-president, Legal Affairs

                                Telecopier Number : (514) 985-8834


(b)     GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the Province of Quebec and the laws of Canada
applicable therein.

(c)     SUCCESSORS AND ASSIGNS. The respective rights and obligations of the
Issuer and of the Holder hereunder shall be binding upon and inure to the
benefit of their respective successors and assigns, PROVIDED THAT the Holder
hereunder may only assign the totality of the unpaid balance of the Face Amount
hereof at the time of an assignment.

        Without restricting the foregoing, the Issuer and the Holder acknowledge
and agree that the Cancap shall be binding upon, and be an obligation of, any
corporation with which the Issuer may amalgamate.

(d)     SEVERABILITY. Any provision of the Canacap that is held invalid, illegal
or unenforceable in any jurisdiction shall not affect the validity, legality or
enforceability of the other provisions of the Cancap in such jurisdiction or any
provision of the Cancap in any other jurisdiction. The Issuer and the Holder
shall endeavour in good-faith negotiations to replace any invalid, illegal or
unenforceable provisions with valid, legal and enforceable provisions, as the
case may be, the economic effect of which shall, taken together with the other
provisions of the Cancap, come as close as possible to the economic effects the
parties intended by the Cancap and the transactions contemplated thereby.

(e)     COUNTERPARTS. The Cancap and any instrument or other document executed
in connection therewith may be executed in any number of counterparts, each of
which shall be original but all of which together shall constitute one (1)
instrument or other document, as the case may be.






(f)     LOSS. In the event the Cancap is misplaced, lost or stolen, the Issuer
shall upon demand, issue and deliver, without cost, to the Holder a new Cancap
identical to this one, as replacement thereof.


IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized
representative to execute this Agreement as of the date first written above.

ISSUER

SUN MEDIA CORPORATION


By:      ______________________
         Name : Pierre Francoeur
         Title: President & Chief
                Executive Officer


HOLDER

QUEBECOR MEDIA INC.



By:      ____________________________________
         Name : Louis St-Arnaud
         Title: Vice-President, Legal Affairs and Secretary

EX-10.10

                                                                 EXHIBIT 10.10

                         SUN MEDIA (TORONTO) CORPORATION
         12.25% Convertible Obligation ("Cancap") due November 28, 2008

CDN $350,000,000                                             November 28, 2002

     FOR VALUE RECEIVED, the undersigned, SUN MEDIA (TORONTO) CORPORATION, a
company continued and existing under the COMPANY ACT (British Columbia) (the
"ISSUER"), hereby promises to pay to SUN MEDIA CORPORATION, a company
organized and existing under the COMPANY ACT (British Columbia), or its
assigns (in each case, the "HOLDER"), the sum of 350,000,000 Canadian Dollars
(the "FACE AMOUNT") on November 28, 2008, with interests ("COUPON PAYMENTS")
on the unpaid balance thereof at the rate of 12.25% per annum from the date
hereof. The Coupon Payments shall be payable (subject to Section 2(b) hereof)
semi-annually on January 14 and July 14 of each year (the first Coupon
Payment, which shall be of $5,520,890.41 and payable on January 14, 2003, and
the last Coupon Payment which shall be of $16,092,808.22 and payable November
28, 2008), until the Face Amount hereof shall become due and payable.

     This 12.25% Convertible Obligation due November 28, 2008 (together with
any security issued upon transfer or exchange of or in substitution for this
Convertible Obligation, in each case, the "CANCAP") is an obligation of the
Issuer. The Holder of the Cancap will be deemed, by its acceptance of such
Cancap, to have agreed to all of the provisions thereof.

     1.  DEFINITIONS.  The following are definitions which apply to the
Cancap:

"CREDIT FACILITY" means the amended and restated credit agreement dated as of
April 1, 2000, as amended from time to time, between the Issuer (as
borrower), the financial institutions identified therein (as lenders), Royal
Bank of Canada (as administrative agent) and Credit Suisse First Boston
Canada (as documentation agent).

"CONVERSION PRICE" means the fair market value per share (as defined
hereinafter) at the time of a conversion pursuant to Section 6 hereof, as
determined in good faith by the Board of Directors of the Issuer;

"SHARE PAYMENT PRICE" means the fair market value per Share at the time of a
share payment pursuant to Section 2(c) hereof, as determined in good faith
by the Board of Directors of the Issuer; and

"SHARES" means fully-paid and non-assessable common shares of the capital
stock of the Issuer or its successor, and "SHARE" means one (1) such share.

     2.  (a)  CASH PAYMENT.  Subject to Sections 2(c) and 6(a), payments with
respect to the Cancap shall be made in lawful money of Canada. Payments due
and payable on the Cancap shall be made, without the presentment or surrender
of any Cancap, by wire transfer or such other method, and at such


address in Canada (the "PLACE OF PAYMENT"), as shall be specified by the
Holder in a notice given at any time and from time to time to the Issuer.

         (b)  PAYMENT DEFERRAL OPTION.  The Issuer may elect to defer, at any
time and from time to time, Coupon Payments on the Cancap by extending the
Coupon Payment period on the Cancap for a period (each such period, an
"EXTENSION PERIOD") of up to twelve (12) consecutive semi-annual periods;
provided, however, that no Extension period may extend beyond November 28,
2008.

         (c)  SHARE PAYMENT OPTION.  The Issuer may at any time, at its
option, elect to satisfy its obligation to pay deferred semi-annual and the
final Coupon Payment amounts by issuing and delivering to the Holder, for
each portion of $1,000 of Coupon Payment owed under the Cancap, the number of
Shares obtained by dividing $1,000 by the Share Payment Price.

     3.  OPTIONAL REDEMPTION.  The Cancap is redeemable at the option of the
Issuer, in whole at any time or in part from time to time, at a redemption
price equal to the then outstanding Face Amount (or portion thereof called
for redemption, as the case may be), together, in each case, with accrued and
unpaid Coupon Payments, if any, to the redemption date.

     In order to effect an optional redemption, the Issuer shall provide to
the Holder a notice of redemption of at least one (1) business day. On and
after any redemption date, Coupon Payments will cease to accrue on the Cancap
or portion thereof called for redemption.

     4.  MANDATORY REDEMPTION.  (a)  The occurrence of any of the following
shall constitute a "MANDATORY REDEMPTION EVENT":

         (1)  any failure to pay the Face Amount of the Cancap when due and
payable (whether at maturity or a date fixed for redemption or by declaration
or otherwise);

         (2)  any failure to pay any Coupon Payment on the Cancap when due
and payable, which failure continues for a period of thirty (30) days;

         (3)  any failure to perform any other obligation under the Cancap,
which failure continues for more than thirty (30) days after receipt by the
Issuer of a notice from the Holder describing such failure in reasonable
detail;

         (4)  the Issuer (i) admits in writing its inability to pay its debts
as they become due, (ii) files, or consents by answer or otherwise to the
filing against it of, a petition for relief, reorganisation or arrangement or
any other petition in bankruptcy or for liquidation or to take advantage of
any bankruptcy, insolvency, reorganization, moratorium or other similar law
of any jurisdiction, (iii) makes an assignment for the benefit of its
creditors, (iv) consents to the appointment of a custodian, receiver, trustee
or other officer with similar powers with respect to it or



any substantial part of its assets or (v) takes corporate action for the
purpose of the foregoing; or

         (5)  a court or other governmental authority of competent
jurisdiction enters an order (i) appointing a custodian, receiver, trustee or
other officer with similar powers with respect to the issuer or any
substantial part of its assets, (ii) for relief or approving a petition for
relief, reorganization or any other petition in bankruptcy or for liquidation
of the issuer or to take advantage of any bankruptcy, insolvency,
reorganization, moratorium, or other similar law of any jurisdiction or (iii)
for the dissolution, winding-up or liquidation of the Issuer, or any such
petition shall be filed against the Issuer and not be dismissed within ninety
(90) days.

(b)  The Cancap is not redeemable at the option of the Holder upon any
Mandatory Redemption Event prior to May 15, 2007. From and after May 15,
2007, the Cancap is not redeemable at the option of the Holder upon any
Mandatory Redemption Event unless (i) no amounts are outstanding under the
Credit Facility, (ii) the administrative agent under the Credit Facility has
already demanded payment of amounts owing under the Credit Facility, or (iii)
if amounts are outstanding under the Credit Facility, not less than ninety
(90) days' advance notice of the Mandatory Redemption Event has been given to
the administrative agent under the Credit Facility. Subject to the foregoing,
if any Mandatory Redemption Event has occurred and is continuing, the Holder
may, by written notice to the Issuer, declare the Cancap to be immediately
due and payable to the holder. In any such case, the Cancap will mature, and
all amounts payable with respect thereto shall become immediately due and
payable, without presentment, demand, protest or further notice, all of which
are hereby waived.

(c)  At any time after the Cancap has been declared immediately due and
payable, the Holder may, by notice to the Issuer, rescind such declaration
and its consequences; PROVIDED THAT (i) no judgment or decree shall have been
entered for the payment of the Cancap by reason of such declaration, (ii) the
Issuer shall have paid all amounts then due and payable (other than by virtue
of such declaration) with respect to the Cancap, and (iii) all non-monetary
Mandatory Redemption Events, if any, shall have been waived by the holder of
shall have been cured.

5.   RANKING. The obligations of the Issuer under the Cancap are subordinated
in right of payment to the prior payment in full of all existing and future
indebtedness of the Issuer. The holders of all other indebtedness of the
Issuer will be entitled to receive payment in full of all amounts due on or
in respect of all other indebtedness of the Issuer before the Holder is
entitled to receive or retain payment of any kind on the Cancap.

6.   CONVERTIBILITY. (a) By giving a notice (a "CONVERSION NOTICE") to the
Holder at any time prior to the close of business on November 27, 2008 or the
business day immediately preceding the date of a redemption, as the case may
be, the Issuer may elect to convert all or any part of the unpaid Face Amount
and accrued and unpaid Coupon Payments into Shares at the Conversion Price,
the number of which Shares shall be determined by dividing the amount to be
so converted by the


Conversion Price. Until the Issuer converts any unpaid Face Amount and
accrued and unpaid Coupon Payments to Shares, the Holder shall have under
this Section 6 none of the rights or obligations of a shareholder of the
Issuer.

(b)  RESERVED SHARES; REGISTRATION, LISTING, ETC. The Issuer shall reserve
(if at any time its articles limit the number of authorized Shares) and at
all times keep available, solely for the purpose of delivery upon conversion
of the Cancap as provided in this Section 6, such number of Shares as would
then be deliverable at the Conversion Price upon the conversion of the
Cancap, which Shares would then be deliverable at the Conversion Price upon
the conversion of the Cancap, which Shares would be upon delivery duly and
validly issued and fully paid and non-assessable. If any such Shares require
registration with or approval of any governmental authority under any
applicable law or listing upon any national securities exchange before such
shares maybe issued and delivered upon conversion, the Issuer shall use its
best efforts to cause such Share to be duly registered, approved and listed,
as the case may be.

(c)  CONVERSION PROCEDURE. Each Conversion Notice shall specify (a) the
unpaid Face Amount of the Cancap, (b) accrued and unpaid Coupon Payments
payable theron, (c) the Conversion Price and (d) the number of Shares to be
issued and delivered upon conversion. The Issuer shall, within the (10) days
of sending any Conversion Notice (or at such later time as to which the
Issuer and the Holder may agree) deliver to the Holder at the Place of
Payment, against surrender of the Cancap owned by the Holder, (i) at the
Issuer's expense (including any stamp taxes or similar governmental charges),
the appropriate number of duly and validly issued and fully paid and
non-assessable Shares and one (1) or more stock certificates therefor (in
such number and registered in such names as the Holder may direct, provided
that if Shares are to be registered in the name of a person other than the
Holder, the Holder shall take all steps necessary to ensure that such
registration and any transfer resulting therefrom does not breach any
applicable provision of securities law or stock exchange rule) and (ii) to
the extent of any unpaid Face Amount of the Cancap after giving effect to
such conversion (and at the Issuer's expense), one (1) Cancap (registered in
such name as the Holder may direct) in substantially the form, and in
aggregate face amount equal to the such unpaid Face Amount of, such
surrendered Cancap. Each new Cancap shall be dated the date to which the
Coupon Payment shall have been paid on such surrendered Cancap and future
Coupon Payments shall accrue from such date.

7.   MISCELLANEOUS.

(a)  NOTICES. Except as specifically provided elsewhere herein, notices and
other communications required or permitted to be given hereunder will be
effective when in writing and delivered by hand, mail, recognized overnight
courier or telecopier, addressed as follows or to such other addresses as
shall be specified by notice:

     (1)  If to the Issuer:
          Sun Media (Toronto) Corporation
          333, King Street East


          Toronto (Ontario) M5A 3X5

          Attention: Treasurer

          Telecopier Number: (416) 947-3119

     (2)  If to the Holder:
          Sun Media Corporation
          333, King Street East
          Toronto (Ontario) M5A 3X5

          Attention: Vice President, Finance and chief financial officer

          Telecopier Number: (416) 947-3119

(b)  GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the Province of Quebec and the laws of Canada
applicable therein.

(c)  SUCCESSORS AND ASSIGNS. The respective rights and obligations of the
Issuer and of the Holder hereunder shall be binding upon and inure to the
benefit of their respective successors and assigns, PROVIDED THAT the Holder
hereunder may only assign the totality of the unpaid balance of the Face
Amount hereof at the time of an assignment.

     Without restricting the foregoing, the Issuer and the Holder acknowledge
and agree that the Cancap shall be binding upon, and be an obligation of, any
corposation with which the Issuer may amalgamate.

(d)  SEVERABILITY. Any provision of the Cancap that is held invalid, illegal
or unenforceable in any jurisdiction shall not affect the validity, legality
or enforceability of the other provisions of the Cancap in such jurisdiction
or any provision of the Cancap in any other jurisdiction. The Issuer and the
holder shall endeavour in good-faith negotiations to replace any invalid,
illegal or unenforceable provisions with valid, legal and enforceable
provisions, as the case may be, the economic effect of which shall, taken
together with the other provisions of the Cancap, come as close as possible
to the economic effects the parties intended by the Cancap and the
transactions contemplated thereby.

(e)  COUNTERPARTS. The Cancap and any instrument or other document executed
in connection therewith may be executed in any number of counterparts, each
of which shall be original but all of which together shall constitute one (1)
instrument or other document, as the case may be.

(f)  LOSS. In the event the Cancap is misplaced, lost or stolen, the Issuer
shall upon demand, issue and deliver, without cost, to the Holder a new
Cancap identical to this one, as replacement thereof.


IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized
representative to execute this Agreement as of the date first written above.

ISSUER
- ------

SUN MEDIA (TORONTO) CORPORATION

By:
   -------------------------------------------
   Name:  Kin-Man Lee
   Title: Vice President, Corporate Controller

HOLDER
- ------

SUN MEDIA CORPORATION

By:
   -------------------------------------------
   Name:  Pierre Francoeur
   Title: President & Chief Executive Officer

EX-10.11

                                                                   EXHIBIT 10.11



                          MANAGEMENT SERVICES AGREEMENT



BETWEEN:                     QUEBECOR  MEDIA INC.,  a company  incorporated
                             under the laws of the Province of Quebec;

                             (hereinafter referred to as "QMI")

AND:                         SUN MEDIA  CORPORATION,  a company incorporated
                             under the COMPANY ACT, British Columbia;

                             (hereinafter referred to as "Sun")


WHEREAS Sun is an indirect wholly-owned subsidiary of QMI;

WHEREAS QMI has agreed to provide Sun with certain management services subject
to and upon the terms and conditions set forth herein;


NOW THEREFORE THE PARTIES AGREE AS FOLLOWS:

1.      QMI undertakes to provide Sun with the management services described in
        Schedule "A" (the "Services") in the manner set out below.

2.      In consideration of the Services, Sun shall pay to QMI an annual fee
        (the "Annual Fee") as follows:

         2.1    The Annual Fee for the year 2002 shall be equal to five million
                one hundred thousand dollars (5 100 000 $);

         2.2    The Annual Fee for the year 2003 shall be equal to five million
                four hundred thousand dollars (5 400 000 $); and

         2.3    The Annual Fee for each of the years 2004, 2005, and 2006 shall
                be negotiated between the parties, acting in good faith, in
                accordance with their budgeting process on or about the first
                day of October of each preceding year.

3.      In addition to the Annual Fee, QMI shall be entitled to the
        reimbursement of its reasonable out-of-pocket expenses incurred in
        relation with the provision of the Services (including, without
        limitation, reasonable fees and disbursements of legal and financial
        advisors).

4.      For any given year, in no event shall the amount paid by Sun to QMI
        pursuant to Sections 2 and 3 of this Agreement exceed one and a half
        percent (1.5 %) of Sun's Consolidated Revenues for any such given year.
        For the purposes of this Agreement, "Sun's Consolidated Revenues" means
        the gross revenues of Sun and its subsidiaries determined on a
        consolidated basis in accordance with the generally accepted accounting
        principles consistently applied in Canada (GAAP)

5.      The Annual Fee shall be payable in equal monthly instalments, in advance
        on the first day of each month.

6.      All amounts payable under this Agreement are in Canadian dollars, and
        are exclusive of applicable taxes.





                                     - 2 -



7.      Notwithstanding its actual date of signature, this Agreement shall be
        for a term of five years commencing on January 1st, 2002 and ending on
        December 31st, 2006. Notwithstanding the foregoing, either party may
        terminate this Agreement by written notice to the other party at least
        sixty (60) days prior to the end of any fiscal year.

8.      The preamble and the schedule attached to this Agreement shall form an
        integral part of this Agreement.

9.      This Agreement shall enure to the benefit of and be binding upon the
        respective successors and permitted assigns of the parties hereto.

10.     This Agreement constitutes the entire agreement between the parties
        hereto with respect to the subject matter hereof and cancels and
        supersedes any prior understandings and agreements between the parties
        hereto with respect thereto. There are no representations, warranties,
        terms, conditions, undertakings or collateral agreements, express,
        implied or statutory, between the parties other than as expressly set
        forth in this Agreement.

11.     No amendment to this Agreement shall be valid or binding unless set
        forth in writing and duly executed by both parties. No waiver of any
        breach of any provision of this Agreement shall be effective or binding
        unless made in writing and signed by the party purporting to give the
        same and, unless otherwise provided in the written waiver, shall be
        limited to the specific breach waived

12.     Sun may not assign its rights or obligations under this Agreement
        without the prior written consent of QMI.

13.     Any request, notice or other communication (a "Communication") to be
        given in connection with this Agreement shall be given in writing and
        may be given by personal delivery, by registered mail or by telecopier
        addressed to the recipient as follows

        To QMI.

               QUEBECOR MEDIA INC.
               300 Viger Avenue East
               Montreal, Quebec
               H2X 3W4

               Telecopier:  (514) 985-8834
               Attention: Vice-President, Legal Affairs and Corporate Secretary

        To Sun.

                SUN MEDIA CORPORATION
                300 Viger Avenue East
                Montreal, Quebec
                H2X 3W4
                Telecopier: (514) 985-8834
                Attention: Corporate Secretary

        or such other address, telecopier number or individual as may be
        designated by notice by a party to the other. Any Communication given by
        personal delivery shall be deemed to have been given





                                     - 3 -


        on the day of actual delivery thereof and, if given by registered mail,
        on the second Business Day following the deposit thereof in the mail
        and, if given by telecopier, on the day of transmittal thereof.

14.     This Agreement shall be governed by and construed in accordance with the
        laws of the Province of Quebec and the laws of Canada applicable
        therein.

15.     The Parties have requested that this Agreement be drafted in the English
        language. LES PARTIES ONT EXIGE QUE CE CONTRAT SOIT REDIGE EN LANGUE
        ANGLAISE.


IN WITNESS THEREOF THE PARTIES HAVE EXECUTED THIS AGREEMENT ON JANUARY 17TH,
2003.


                                       QUEBECOR MEDIA INC.


                                       Per:   /s/ Claude Helie
                                              ------------------------


                                       Per:   ________________________


                                       SUN MEDIA CORPORATION


                                       Per:   /s/ Pierre Francoeur
                                              ------------------------


                                       Per:   ________________________






                                  SCHEDULE "A"


                             DESCRIPTION OF SERVICES



- -    Internal Audit

- -    Legal and Corporate Services

- -    Financial Planning and Treasury

- -    Tax Services

- -    Real Estate

- -    Financial Analysis

- -    Human Resources

- -    Insurance and Risk Management Services

- -    Public Relations, Investor Relations and Communications Services

- -    Top Management Services

- -    and other services to be agreed upon between the parties.

EX-12.1

                                                                    EXHIBIT 12.1

SUN MEDIA CORPORATION
COMPUTATION OF EARNINGS TO FIXED CHARGES

CANADIAN GAAP




===================================================================================================================================
                                                                                     Year ended December 31,
                                                               1998           1999           2000           2001           2002
- -----------------------------------------------------------------------------------------------------------------------------------
                                                                                                       
Fixed charges
      Interest expense, before interest income                  N/A        $64,582        $53,697        $42,289        $33,300
      Amortization of capitalized expenses related
           to indebtedness                                      N/A          1,021            732          1,184          1,352
      Interest capitalized to the cost of fixed assets          N/A              -             51            397              -

                                                           ------------------------------------------------------------------------
                                                                  -        $65,603        $54,480        $43,870        $34,652
                                                           ========================================================================

Earnings
      Income from continuing operations before
           income taxes and non-controlling interest            N/A        $76,171       $105,571       $189,057       $363,006
      Fixed charges                                             N/A         65,603         54,480         43,870         34,652
      Interest capitalized to the cost of fixed assets          N/A              -            (51)          (397)             -
      Amortization of capitalized interest                      N/A              -              -             30             30

                                                           ------------------------------------------------------------------------
                                                                  -       $141,774       $160,000       $232,560       $397,688
                                                           ========================================================================


Ratio of earnings to fixed charges                              N/A           2.16           2.94           5.30          11.48
===================================================================================================================================



US GAAP



===================================================================================================================================
                                                                                    Year ended December 31,
                                                               1998           1999           2000           2001           2002
- -----------------------------------------------------------------------------------------------------------------------------------
                                                                                                       
Fixed charges
      Interest expense, before interest income                  N/A        $64,582        $53,697       $134,962       $230,779
      Amortization of capitalized expenses related
           to indebtedness                                      N/A          1,021            732          2,997           (341)
      Interest capitalized to the cost of fixed assets          N/A              -             51            397              -

                                                           ------------------------------------------------------------------------
                                                                  -        $65,603        $54,480       $138,356       $230,438
                                                           ========================================================================

Earnings
      Income from continuing operations before
           income taxes and non-controlling interest            N/A        $73,208        $99,039       $ 93,712       $166,265
      Fixed charges                                             N/A         65,603         54,480        138,356        230,438
      Interest capitalized to the cost of fixed assets          N/A              -            (51)          (397)             -
      Amortization of capitalized interest                      N/A              -              -             30             30

                                                           ------------------------------------------------------------------------
                                                                  -       $138,811       $153,468       $231,701       $396,733
                                                           ========================================================================

Ratio of earnings to fixed charges                              N/A           2.12           2.82           1.67           1.72
===================================================================================================================================





SUN MEDIA CORPORATION
COMPUTATION OF PRO FORMA EARNINGS TO FIXED CHARGES

CANADIAN GAAP





======================================================================================================================
                                                                                         Year ended December 31,  2002
- ----------------------------------------------------------------------------------------------------------------------
                                                                                                         
Fixed charges
      Interest expense, before interest income                                                               $ 37,224
      Amortization of capitalized expenses related to indebtedness                                              1,487

                                                                                                       --------------
                                                                                                             $ 38,711
                                                                                                       ==============

Earnings
      Income from continuing operations before
           income taxes and non-controlling interest                                                         $358,947
      Fixed charges                                                                                            38,711
      Amortization of capitalized interest                                                                         30

                                                                                                       --------------
                                                                                                             $397,688
                                                                                                       ==============

Proforma ratio of earnings to fixed charges                                                                     10.27
=====================================================================================================================



US GAAP




======================================================================================================================
                                                                                         Year ended December 31,  2002
- ----------------------------------------------------------------------------------------------------------------------
                                                                                                        
Fixed charges
      Interest expense, before interest income                                                               $234,703
      Amortization of capitalized expenses related to indebtedness                                               (206)

                                                                                                       --------------
                                                                                                             $234,497
                                                                                                       ==============

Earnings
      Income from continuing operations before
           income taxes and non-controlling interest                                                         $162,206
      Fixed charges                                                                                           234,497
      Amortization of capitalized interest                                                                         30

                                                                                                       --------------
                                                                                                             $396,733
                                                                                                       ==============

Proforma ratio of earnings to fixed charges                                                                      1.69
=====================================================================================================================

EX-12.2

                                                                Exhibit 12.2

                          SUN MEDIA CORPORATION
                  Computation of ratio of total debt to EBITDA


CANADIAN GAAP



                                                 YEARS ENDED DECEMBER 31,
                                              2000         2001          2002
                                              ----         ----          ----
                                                                 
Total debt
     Current portion of long-term debt    $      -      $  5,000      $ 60,000
     Long-term debt                        595,195       549,512       455,147
                                          --------      --------      --------
                                          $595,195      $554,512      $515,147
                                          ========      ========      ========
EBITDA(1)                                 $205,327      $200,844      $222,333
                                          ========      ========      ========

Ratio of total debt to EBITDA                 2.90          2.76          2.32
                                          ========      ========      ========


(1)  As defined in "Presentation of Financial Information" and calculated in
note 7 to "Selected Consolidated Financial and Operating Data".

EX-12.3

SUN MEDIA CORPORATION
FINANCIAL STATEMENT SCHEDULE
SCHEDULE OF VALUATION AND QUALIFYING ACCOUNTS
(Amounts in thousands of Canadian dollars)





====================================================================================================================
                                                 Balance,
                                               beginning of      Charged to costs                      Balance, end
                                                   year            and expenses       Deductions         of year
- --------------------------------------------------------------------------------------------------------------------
                                                                                           
Allowance for doubtful accounts receivable

      Year ended December 31:
             2000                                $7,216            $1,938 (1)          $4,019 (2)          5,135
             2001                                 5,135             1,775 (1)           3,059 (2)          3,851
             2002                                 3,851             2,837 (1)           2,770 (2)          3,918


Notes:

     (1) Represents increase in allowance for doubtful accounts receivable charged to expense.

     (2) Represents the accounts receivable written-off against the allowance for doubtful accounts receivable.

EX-21.1

                                                                    EXHIBIT 21.1


SUBSIDIARIES OF SUN MEDIA CORPORATION

Name of Subsidiary (Jurisdiction of Incorporation)
- --------------------------------------------------
Bowes Publishers Limited (British Columbia)
Sun Media (Toronto) Corporation (British Columbia)
SMC Nomineeco Inc. (Ontario)
Le Courrier du Sud (1998) Inc. (Quebec)
3661458 Canada Inc. (Canada)
Toronto Sun International, Inc. (Delaware)
TS Printing, Inc. (Delaware)
Florida Sun Publications, Inc. (Delaware)
3351611 Canada Inc. (Canada)

EX-23.1

                                                                  EXHIBIT 23-1


[KPMG LOGO]

      KPMG LLP         Yonge Corporate Centre           Telephone (416) 228-7000
                       4100 Yonge Street Suite 200      Telefax (416) 228-7123
                       Toronto, ON M2P 2H3



             REPORT AND CONSENT OF INDEPENDENT CHARTERED ACCOUNTANTS



The Board of Directors
Sun Media Corporation

The audits referred to in our report dated January 24, 2003, except as to note
19 which is as of February 7, 2003, included the related financial statement
schedule as at and for each of the years in the three year period ended December
31, 2002, included in the registration statement. This financial statement
schedule is the responsibility of the Company's management. Our responsibility
is to express an opinion on this financial statement schedule based on our
audits. In our opinion, such financial statement schedule, when considered in
relation to the basic consolidated financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.

We consent to the use of our report dated January 24, 2003, except as to note 19
which is as of February 7, 2003 on the consolidated balance sheets of Sun Media
Corporation as at December 31, 2001 and 2002 and the consolidated statements of
income, shareholder's equity and cash flows for each of the years in the three
year period ended December 31, 2002 included herein.


/s/ KPMG LLP

Toronto, Canada
March 24, 2003

EX-25.1

                                                                    EXHIBIT 25.1



                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    ---------

                                    FORM T-1

                   STATEMENT OF ELIGIBILITY AND QUALIFICATION
                   UNDER THE TRUST INDENTURE ACT OF 1939 OF A
                    CORPORATION DESIGNATED TO ACT AS TRUSTEE

Check if an application to determine eligibility of a Trustee pursuant to
section 305(b) (2)

                               NATIONAL CITY BANK
               (Exact name of Trustee as specified in its charter)

                                   34-0420310
                      (I.R.S. Employer Identification No.)

            1900 East Ninth Street
            Cleveland, Ohio                       44114
            (Address of principal executive     (zip code)
            offices)

            David L. Zoeller
            Senior Vice President and General Counsel
            National City Corporation
            1900 East Ninth Street
            Cleveland, Ohio 44114
            (216) 575-9313


            (Name, address and telephone number of agent for service)
                                   ----------
                              SUN MEDIA CORPORATION
          AND THE GUARANTORS LISTED ON THE TABLE OF ADDITIONAL OBLIGORS
               (Exact name of obligor as specified in its charter)

                    CANADA                              98-0336794
        (State or other jurisdiction of              (I.R.S. Employer
        incorporation or organization)              Identification No.)


        333 King Street East
        Toronto, Ontario                                   M5A 3X5
        (Address of principal executive offices)         (Zip Code)

                            7.625 % Senior Notes and
                       Guarantees of 7.625 % Senior Notes
                       (Title of the Indenture securities)





                          TABLE OF ADDITIONAL OBLIGORS

         The following subsidiaries of Sun Media Corporation have fully and
unconditionally guaranteed the 7.625% Senior Notes due 2013 of Sun Media
Corporation and are additional obligors.





- ----------------------------------------------------------------------------------------------------------------------
EXACT NAME OF ADDITIONAL OBLIGOR AS SPECIFIED IN          STATE OR OTHER JURISDICTION OF           I.R.S. EMPLOYER
ITS CHARTER*                                              INCORPORATION OR ORGANIZATION         IDENTIFICATION NUMBER
- ----------------------------------------------------------------------------------------------------------------------
                                                                                          
Bowes Publishers Limited                             Province of British Columbia                       98-033996
- ----------------------------------------------------------------------------------------------------------------------
Sun Media (Toronto) Corporation                      Province of British Columbia                      98-0341895
- ----------------------------------------------------------------------------------------------------------------------
SMC Nomineeco Inc.                                   Province of Ontario                           Not applicable
- ----------------------------------------------------------------------------------------------------------------------
Toronto Sun International, Inc.                      Delaware                                          65-0785241
- ----------------------------------------------------------------------------------------------------------------------
TS Printing, Inc.                                    Delaware                                          52-1583766
- ----------------------------------------------------------------------------------------------------------------------
Florida Sun Publications, Inc.                       Delaware                                          65-0133064
- ----------------------------------------------------------------------------------------------------------------------
3661458 Canada Inc.                                  Canada                                        Not applicable
- ----------------------------------------------------------------------------------------------------------------------
3351611 Canada Inc.                                  Canada                                        Not applicable
- ----------------------------------------------------------------------------------------------------------------------


*  The address of the principal executive offices of each additional obligor is
   the same address as the principal executive offices of Sun Media Corporation.





                                     GENERAL


1.       General information.  Furnish the following information as to the
trustee:

         (a)      Name and address of each examining or supervising authority to
                  which it is subject.

                           Comptroller of the Currency, Washington, D.C.
                           The Federal Reserve Bank of Cleveland, Cleveland,
                           Ohio Federal Deposit Insurance Corporation,
                           Washington, D.C.

         (b)      Whether it is authorized to exercise corporate trust powers.

                  National City Bank is authorized to exercise corporate trust
                  powers.


2.       Affiliations with obligor. If the obligor is an affiliate of the
trustee, describe such affiliation.

                  NONE

16.      List of exhibits

         (1)      A copy of the Articles of Association of the Trustee.

                  Incorporated herein by reference is Charter No. 786 Merger No.
         1043 the Articles of Association of National City Bank, which Articles
         of Association were included as a part of Exhibit 1 to Form T-1 filing
         made by said National City Bank with the Securities and Exchange
         Commission in November 1973 (File No. 2-49786).

                  Incorporated herein by reference is an amendment to the
                  Articles of Association of National City Bank, which amendment
                  was included as a part of Exhibit 1 to Form T-1 filing made by
                  said National City Bank with the Securities and Exchange
                  Commission in April 1996 (File No. 333-02761)

         (2)      A copy of the certificate of authority of the Trustee to
         commence business:

                  (a)      a copy of the certificate of NCB National Bank to
                           commence business.






                  Incorporated herein by reference is a true and correct copy of
                  the certificate issued by the Comptroller of the Currency
                  under date of April 26, 1973, whereby NCB National Bank was
                  authorized to commence the business of banking as a National
                  banking Association, which true copy of said Certificate was
                  included as Exhibit 2(a) to Form T-1 filing made by said
                  National City Bank with the Securities and Exchange Commission
                  in November 1973 (File 2-49786)

                  (b) a copy of the approval of the merger of The National City
                  Bank of Cleveland into NCB National Bank under the charter of
                  NCB National Bank and under the title "National City Bank."

                  Incorporated herein by reference is a true and correct copy of
                  the certificate issued by the Comptroller of the Currency
                  under date of April 27, 1973, whereby the National City Bank
                  of Cleveland was merged into NCB National Bank, which true
                  copy of said certificate was included as Exhibit 2(b) to Form
                  T-1 filing made by said National City Bank with the Securities
                  and Exchange Commission in November 1973 (File 2-49786).

         (3)      A copy of the authorization of the Trustee to exercise
corporate trust powers.

                  Incorporated herein by reference is a true and correct copy of
                  the certificate dated April 13, 1973 issued by the Comptroller
                  of the Currency whereby said National City Bank has been
                  granted the right to exercise certain trust powers, which true
                  copy of said certificate was included as Exhibit 3 to Form T-1
                  filing made by said National City Bank with the Securities and
                  Exchange Commission in November 1973 (File 2-49786).

         (4)      A copy of existing By-Laws of the Trustee.

                  Incorporated herein by reference is a true and correct copy of
                  the National City Bank By-Laws as amended through January 1,
                  1993. This true copy of said By-Laws was included as Exhibit 4
                  to Form T-1 filing made by National City Bank with the
                  Securities and Exchange Commission in March, 1995 (File
                  22-26594).

         (5)      Not applicable.






         (6)      Consent of the United States Institutional Trustee required by
                  Section 321(b) of the Act.

                  Attached hereto as Exhibit 6 is the Consent of the Trustee in
                  accordance with Section 321 (b) of the Trust Indenture Act of
                  1939 as amended.

         (7)      A copy of the latest report of condition of the Trustee
                  published pursuant to law or the requirements of its
                  supervising or examining authority.

                  Attached hereto as Exhibit 7 is the latest report of condition
                  of National City Bank.

         (8)      Not applicable.

         (9)      Not applicable.

                                      NOTES

         IN ANSWERING ANY ITEM OF THIS STATEMENT OF ELIGIBILITY AND
QUALIFICATION WHICH RELATES TO MATTERS PECULIARLY WITH THE KNOWLEDGE OF THE
OBLIGOR OR ANY UNDERWRITER FOR THE OBLIGOR OR ANY UNDERWRITER FOR THE OBLIGOR,
THE TRUSTEE HAS RELIED UPON THE INFORMATION FURNISHED TO IT BY THE OBLIGOR AND
THE UNDERWRITERS, AND THE TRUSTEE DISCLAIMS RESPONSIBILITY FOR THE ACCURACY OR
COMPLETENESS OF SUCH INFORMATION.

         THE ANSWER FURNISHED TO ITEM 2. OF THIS STATEMENT WILL BE AMENDED, IF
NECESSARY, TO REFLECT ANY FACTS WHICH DIFFER FROM THOSE STATED AND WHICH WOULD
HAVE BEEN REQUIRED TO BE STATED IF KNOWN AT THE DATE HEREOF.





                                    SIGNATURE

         Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, National City Bank, a national banking association organized and
existing under the laws of the United States of America, has duly caused this
statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of Cleveland, and State of Ohio, on
the 13th day of March, 2003.


                                       NATIONAL CITY BANK

                                       By: /s/ James E. Schultz
                                           ------------------------------
                                           James E. Schultz
                                           Vice President





                                     CONSENT

         In accordance with Section 321(b) of the Trust Indenture Act of
1939, as amended, and to the extent required thereby to enable it to act as
an indenture trustee, National City Bank hereby consents as of the date
hereof that reports of examinations of it by the Treasury Department, the
Comptroller of the Currency, the Board of Governors of the Federal Reserve
Banks, the Federal Deposit Insurance Corporation or of any other Federal or
State authority having the right to examine National City Bank, may be
furnished by similar authorities to the Securities and Exchange Commission
upon request thereon.

                                       NATIONAL CITY BANK

                                       By /s/  James E. Schultz
                                          ------------------------------
                                          James E. Schultz
                                          Vice President







                               REPORT OF CONDITION
                               NATIONAL CITY BANK
                  (Including Domestic and Foreign Subsidiaries)
         In the State of Ohio, at the close of business on June 30, 2002






                                                    ASSETS
                                                    ------
                                                                                                 (IN THOUSANDS)
                                                                                                
Cash and balances due from depository institutions:
     Noninterest-bearing balances and currency and coin.........................................   $1,642,633
     Interest-bearing balances..................................................................          850
Securities:
     Held-to-maturity securities................................................................            0
     Available-for-sale securities..............................................................    3,793,709
Federal funds sold and securities purchased under agreements to
resell......................................                                                          590,870
               Federal funds sold in domestic offices
               Securities purchased under agreements to resell..................................      106,515
Loans and lease financing receivables:
     Loans and leases held for sale.............................................................      371,401
     Loans and leases, net of unearned income..................................      $33,554,861
     Less:  Allowance for loan and lease losses................................          537,134
     Loans and leases, net of unearned  income and allowance....................................   33,017,727
Assets held in trading accounts.................................................................      299,702
Premises and fixed assets (including capitalized leases)........................................      416,516
Other real estate owned.........................................................................        7,757
Investments in unconsolidated subsidiaries and associated companies.............................            0
Customers' liability to this bank on acceptances outstanding....................................       19,802
Intangible assets...............................................................................      108,319
Other assets....................................................................................    3,345,800
                                                                                                 --------------
  TOTAL ASSETS..................................................................................  $43,721,511
                                                                                                 --------------
                                                                                                 --------------


                                                  LIABILITIES
                                                  -----------

Deposits:
     In domestic offices........................................................................  $22,281,127
          Non-interest bearing.................................................       $5,168,329
          Interest-bearing.....................................................       17,112,798
     In foreign offices, Edge and Agreement subsidiaries, and  IBFs.............................    1,502,078
          Interest-bearing.....................................................        1,502,078
Federal funds purchased and securities sold under agreements to repurchase :
    Federal funds purchased in domestic offices.................................................      688,179
    Securities sold under agreements to repurchase..............................................    1,334,605
Demand notes issued to the U.S. Treasury........................................................            0
Trading Liabilities.............................................................................            0
Other borrowed money............................................................................   11,014,950
Bank's liability on acceptances executed and outstanding........................................       19,802
Subordinated notes and debentures...............................................................    1,366,829
Other liabilities...............................................................................    2,623,140
                                                                                                 --------------
     TOTAL LIABILITES...........................................................................   40,830,710
                                                                                                 --------------


                                                EQUITY CAPITAL
                                                --------------
Common Stock....................................................................................        7,311
Surplus.........................................................................................      588,618
Retained Earnings...............................................................................    2,349,612
Accumulated other comprehensive income..........................................................      (54,740)
                                                                                                 --------------
     TOTAL EQUITY CAPITAL.......................................................................    2,890,801
                                                                                                 --------------
     TOTAL LIABILITES AND EQUITY CAPITAL........................................................  $43,721,511
                                                                                                 --------------
                                                                                                 --------------

EX-99.1

                             LETTER OF TRANSMITTAL

                                      FOR
                           TENDER OF ALL OUTSTANDING
                          7 5/8% SENIOR NOTES DUE 2013
                  IN EXCHANGE FOR 7 5/8% SENIOR NOTES DUE 2013
                        THAT HAVE BEEN REGISTERED UNDER
                    THE SECURITIES ACT OF 1933, AS AMENDED,

                                       OF

                             SUN MEDIA CORPORATION
- ----------------------------------------------------------------------
    THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
            , 2003 (THE "EXPIRATION DATE"), UNLESS THE OFFER IS EXTENDED BY
   SUN MEDIA CORPORATION IN ITS SOLE DISCRETION.
- --------------------------------------------------------------------------------

                 THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:

                               NATIONAL CITY BANK
                                  DELIVER TO:



            BY MAIL:               BY HAND OR OVERNIGHT DELIVERY:            NEW YORK DROP:
                                                              
       National City Bank                National City Bank                National City Bank
        P.O. Box 92301               Corporate Trust Operations       The Depository Trust Company
           LOC #5352                4100 West 150th Street, 3rd       Transfer Agent Drop Service
   Cleveland, Ohio 44193-0900                  Floor                        55 Water Street
                                             LOC #5352                   Jeanette Park Entrance
                                     Cleveland, Ohio 44135-1385         New York, New York 10041

                                           BY FACSIMILE:
                                          (216) 222-9326
                                       CONFIRM BY TELEPHONE:
                                          (216) 222-2552
                                     Attention: Holly Pattison


DELIVERY TO AN ADDRESS OTHER THAN THE DEPOSITORY TRUST COMPANY (ATOP) OR AS
         SET FORTH IN THIS LETTER OF TRANSMITTAL OR TRANSMISSION OF
         INSTRUCTIONS VIA A FACSIMILE TRANSMISSION TO A NUMBER OTHER
              THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID
                                   DELIVERY.

    The undersigned acknowledges that he or she has received and reviewed the
Prospectus dated March [  ], 2003 (the "Prospectus") of Sun Media Corporation
("Sun Media") and this letter of transmittal, which together constitute Sun
Media's offer (the "Exchange Offer") to exchange $1,000 in stated amount at
maturity of a new series of 7 5/8% Senior Notes due 2003 (the "Exchange Notes")
of Sun Media for each $1,000 in stated amount at maturity of outstanding 7 5/8%
Senior Notes due 2013 (the "Outstanding Notes") of Sun Media. The terms of the
Exchange Notes are identical in all material respects (including stated amount
at maturity, interest rate and maturity) to the terms of the Outstanding Notes
for which they may be exchanged pursuant to the Exchange Offer, except that the
Exchange Notes will have been registered under the Securities Act of 1933, as
amended (the "Securities Act"), and, therefore, will not bear legends
restricting their transfer.

    This letter of transmittal is to be used by Holders (as defined below) if:
(i) certificates representing Outstanding Notes are to be physically delivered
to the Exchange Agent with this letter of transmittal by

Holders; (ii) tender of Outstanding Notes is to be made by book-entry transfer
to the Exchange Agent's account at The Depository Trust Company ("DTC") by any
financial institution that is a participant in DTC and whose name appears on a
security position listing as the owner of Outstanding Notes (such participants,
acting on behalf of Holders, are referred to in this letter of transmittal,
together with such Holders, as "Acting Holders"); or (iii) tender of Outstanding
Notes is to be made according to the guaranteed delivery procedures. DELIVERY OF
DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.

    If delivery of the Outstanding Notes is to be made by book-entry transfer to
the account maintained by the Exchange Agent at DTC as set forth in (ii) in the
immediately preceding paragraph, this letter of transmittal need not be manually
executed; provided, however, that tenders of Outstanding Notes must be effected
in accordance with the procedures mandated by DTC's Automated Tender Offer
Program ("ATOP"). To tender Outstanding Notes through ATOP, the electronic
instructions sent to DTC and transmitted by DTC to the Exchange Agent must
contain the character by which the participant acknowledges its receipt of, and
agrees to be bound by, this letter of transmittal.

    Unless the context requires otherwise, the term "Holder" for purposes of
this letter of transmittal means: (i) any person in whose name Outstanding Notes
are registered on the books of Sun Media or any other person who has obtained a
properly completed bond power from the registered Holder, or (ii) any
participant in DTC whose Outstanding Notes are held of record by DTC who desires
to deliver such Outstanding Notes by book-entry transfer at DTC.

    The undersigned has completed, executed and delivered this letter of
transmittal to indicate the action the undersigned desires to take with respect
to the Exchange Offer.

    The instructions included with this letter of transmittal must be followed.
Questions and requests for assistance or for additional copies of the
Prospectus, this letter of transmittal and the Notice of Guaranteed Delivery may
be directed to the Exchange Agent.

    HOLDERS WHO WISH TO ACCEPT THE EXCHANGE OFFER AND TENDER THEIR OUTSTANDING
NOTES MUST COMPLETE THIS LETTER OF TRANSMITTAL IN ITS ENTIRETY.

                                       2

    List below the Outstanding Notes to which this letter of transmittal
relates. If the space provided below is inadequate, the Certificate Numbers and
Stated Amounts at Maturity should be listed on a separate signed schedule
affixed hereto. Tenders of Outstanding Notes will be accepted only in authorized
denominations of $1,000.



- --------------------------------------------------------------------------------------------------
                                 DESCRIPTION OF OUTSTANDING NOTES
- --------------------------------------------------------------------------------------------------
                                                  CERTIFICATE NUMBER(S)*   AGGREGATE STATED AMOUNT
            NAME(S) AND ADDRESS(ES)               (ATTACH SIGNED LIST IF    AT MATURITY TENDERED
           (PLEASE FILL IN, IF BLANK)                   NECESSARY)          (IF LESS THAN ALL)**
- --------------------------------------------------------------------------------------------------
                                                                     
                                                       --------------------------------------

                                                       --------------------------------------

                                                       --------------------------------------

                                                       --------------------------------------

                                                       --------------------------------------

- --------------------------------------------------------------------------------------------------
TOTAL STATED AMOUNT AT MATURITY OF OUTSTANDING NOTES TENDERED
- --------------------------------------------------------------------------------------------------


*   Need not be completed by Holders tendering by book-entry transfer.

**  Need not be completed by Holders who wish to tender with respect to all
    Outstanding Notes listed. See Instruction 2.

/ /  CHECK HERE IF TENDERED OUTSTANDING NOTES ARE BEING DELIVERED BY DTC TO THE
    EXCHANGE AGENT'S ACCOUNT AT DTC AND COMPLETE THE FOLLOWING:

    Name of Tendering Institution ______________________________________________

    DTC Book-Entry Account _____________________________________________________

    Transaction Code No. _______________________________________________________

    Holders who wish to tender their Outstanding Notes and (i) whose Outstanding
Notes are not immediately available, or (ii) who cannot deliver their
Outstanding Notes, the letter of transmittal or any other required documents to
the Exchange Agent prior to the Expiration Date, or cannot complete the
procedure for book-entry transfer on a timely basis, may effect a tender
according to the guaranteed delivery procedures and must also complete the
Notice of Guaranteed Delivery.

/ /  CHECK HERE IF TENDERED OUTSTANDING NOTES ARE BEING DELIVERED PURSUANT TO A
    NOTICE OF GUARANTEED DELIVERY PREVIOUSLY DELIVERED TO THE EXCHANGE AGENT AND
    COMPLETE THE FOLLOWING:

    Name(s) of Holder(s) of Outstanding Notes __________________________________

    Window Ticket No. (if any) _________________________________________________

    Date of Execution of Notice of Guaranteed Delivery _________________________

    Name of Eligible Institution That Guaranteed Delivery ______________________

    DTC Book-Entry Account No. _________________________________________________

    If Delivered by Book-Entry Transfer: Name of

    Tendering Institution ______________________________________________________

    Transaction Code No. _______________________________________________________

                                       3

/ /  CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
    COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS
    THERETO.

    Name _______________________________________________________________________

    Address ____________________________________________________________________

    If the undersigned is not a broker-dealer, the undersigned represents that
it is not engaged in, and does not intend to engage in, a distribution of
Exchange Notes. If the undersigned is a broker-dealer that will receive Exchange
Notes for its own account in exchange for Outstanding Notes that were acquired
as a result of market-making activities or other trading activities, it
acknowledges that it will deliver a prospectus in connection with any resale of
such Exchange Notes; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

              PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

Ladies and Gentlemen:

    Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to Sun Media the stated amount at maturity of
Outstanding Notes described on page 2. Subject to, and effective upon, the
acceptance for exchange of the Outstanding Notes tendered herewith, the
undersigned hereby exchanges, assigns and transfers to, or upon the order of,
Sun Media all right, title and interest in and to such Outstanding Notes. The
undersigned hereby irrevocably constitutes and appoints the Exchange Agent as
the true and lawful agent and attorney-in-fact of the undersigned (with full
knowledge that said Exchange Agent also acts as the agent of Sun Media and as
Trustee under the Indenture for the Outstanding Notes and the Exchange Notes) to
cause the Outstanding Notes to be assigned, transferred and exchanged. The
undersigned represents and warrants that it has full power and authority to
tender, exchange, assign and transfer the Outstanding Notes and to acquire
Exchange Notes issuable upon the exchange of such tendered Outstanding Notes,
and that, when the same are accepted for exchange, Sun Media will acquire good
and unencumbered title to the tendered Outstanding Notes, free and clear of all
liens, restrictions, charges and encumbrances and not subject to any adverse
claim or proxies. The undersigned also warrants that it will, upon request,
execute and deliver any additional documents deemed by the Exchange Agent or Sun
Media to be necessary or desirable to complete the exchange, assignment and
transfer of tendered Outstanding Notes.

    The Exchange Offer is subject to certain conditions as set forth in the
Prospectus under the caption "The Exchange Offer -- Conditions to the Exchange
Offer." The undersigned recognizes that as a result of these conditions (which
may be waived, in whole or in part, by Sun Media) as more particularly set forth
in the Prospectus, Sun Media may not be required to exchange any of the
Outstanding Notes tendered hereby and, in such event, the Outstanding Notes not
exchanged will be returned to the undersigned at the address shown below the
signature of the undersigned.

    By tendering, each Holder of Outstanding Notes represents to Sun Media that
(i) the Exchange Notes acquired pursuant to the Exchange Offer are being
obtained in the ordinary course of business of the person receiving such
Exchange Notes, whether or not such person is such Holder, (ii) neither the
Holder of Outstanding Notes nor any such other person has an arrangement or
understanding with any person to participate in the distribution of such
Exchange Notes, (iii) if the Holder is not a broker-dealer or is a broker-dealer
but will not receive Exchange Notes for its own account in exchange for
Outstanding Notes, neither the Holder nor any such other person is engaged in or
intends to participate in a distribution of the Exchange Notes and (iv) neither
the Holder nor any such other person is an "affiliate" of Sun Media within the
meaning of Rule 405 under the Securities Act of 1933, as amended, or, if such
Holder is such an "affiliate", that such Holder will comply with the
registration and prospectus delivery requirements of the

                                       4

Securities Act to the extent applicable. If the tendering Holder is a
broker-dealer (whether or not it is also an "affiliate" of Sun Media within the
meaning of Rule 405 under the Securities Act) that will receive Exchange Notes
for its own account in exchange for Outstanding Notes, it represents that the
Outstanding Notes to be exchanged for the Exchange Notes were acquired by it as
a result of market-making activities or other trading activities, and
acknowledges that it will deliver a prospectus meeting the requirements of the
Securities Act in connection with any resale of such Exchange Notes. By
acknowledging that it will deliver and by delivering a prospectus meeting the
requirements of the Securities Act in connection with any resale of such
Exchange Notes, the undersigned is not deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

    For purposes of the Exchange Offer, Sun Media shall be deemed to have
accepted validly tendered Outstanding Notes when, as and if Sun Media has given
oral or written notice of such acceptance to the Exchange Agent and complied
with the applicable provisions of the Registration Rights Agreement. If any
tendered Outstanding Notes are not accepted for exchange pursuant to the
Exchange Offer for any reason or if Outstanding Notes are submitted for a
greater stated amount at maturity than the Holder desires to exchange, such
unaccepted or non-exchanged Outstanding Notes will be returned without expense
to the tendering Holder of such Outstanding Notes (or, in the case of
Outstanding Notes tendered by book-entry transfer into the Exchange Agent's
account at the Book-Entry Transfer Facility pursuant to customary book-entry
transfer procedures, such non-exchanged Notes will be credited to an account
maintained with such Book-Entry Transfer Facility) as promptly as practicable
after the expiration or termination of the Exchange Offer.

    All authority conferred or agreed to be conferred by this letter of
transmittal shall survive the death, incapacity or dissolution of the
undersigned, and every obligation under this letter of transmittal shall be
binding upon the undersigned's heirs, personal representatives, successors and
assigns.

    The undersigned understands that tenders of Outstanding Notes pursuant to
the instructions hereto and Sun Media's acceptance of such Outstanding Notes
will constitute a binding agreement between the undersigned and Sun Media upon
the terms and subject to the conditions of the Exchange Offer.

    Unless otherwise indicated under "Special Issuance Instructions," please
issue the certificates representing the Exchange Notes issued in exchange for
the Outstanding Notes accepted for exchange, and return any Outstanding Notes
not tendered or not exchanged, in the name(s) of the undersigned (or in either
such event, in the case of Outstanding Notes tendered by DTC, by credit to the
account at DTC). Similarly, unless otherwise indicated under "Special Delivery
Instructions," please send the certificates representing the Exchange Notes
issued in exchange for the Outstanding Notes accepted for exchange and any
certificates for Outstanding Notes not tendered or not exchanged (and
accompanying documents as appropriate) to the undersigned at the address shown
below the undersigned's signature, unless, in either event, tender is being made
through DTC. In the event that both "Special Issuance Instructions" and "Special
Delivery Instructions" are completed, please issue the certificates representing
the Exchange Notes issued in exchange for the Outstanding Notes accepted for
exchange, and return any Outstanding Notes not tendered or not exchanged, in the
name(s) of, and send said certificates to, the person(s) so indicated. The
undersigned recognizes that Sun Media has no obligation pursuant to the "Special
Issuance Instructions" and "Special Delivery Instructions" to transfer any
Outstanding Notes from the name of the registered Holder thereof if Sun Media
does not accept for exchange any of the Outstanding Notes so tendered.

                                       5

                                   SIGN HERE
                (PLEASE COMPLETE SUBSTITUTE FORM W-9 ON PAGE 12)

            (TO BE COMPLETED BY ALL TENDERING HOLDERS OF OUTSTANDING
            NOTES REGARDLESS OF WHETHER OUTSTANDING NOTES ARE BEING
                         PHYSICALLY DELIVERED HEREWITH)

- --------------------------------------------------------------------------------

      This letter of transmittal must be signed by the Holder(s) of
  Outstanding Notes exactly as their name(s) appear(s) on certificate(s) for
  Outstanding Notes or, if tendered by a participant in DTC, exactly as such
  participant's name appears on a security position listing as the owner of
  Outstanding Notes, or by person(s) authorized to become registered Holder(s)
  by endorsements and documents transmitted with this letter of transmittal.
  If signature is by a trustee, executor, administrator, guardian,
  attorney-in-fact, officer or other person acting in a fiduciary or
  representative capacity, such person must set forth his or her full title
  below under "Capacity" and submit evidence satisfactory to Sun Media of such
  person's authority to so act. See Instruction 3. If the signature appearing
  below is not of the registered Holder(s) of the Outstanding Notes, then the
  registered Holder(s) must sign a valid proxy.

                                           
x                                             Date:

x                                             Date:
Signature(s) of Holder(s) or Authorized
  Signatory

Name(s):                                      Address:

               (Please Print)                             (Including Zip Code)

                                              Area Code and
Capacity(ies):                                Telephone No.:

Taxpayer Identification or Social Security No(s).:



                              SIGNATURE GUARANTEE
                              (SEE INSTRUCTION 3)
        CERTAIN SIGNATURES MUST BE GUARANTEED BY AN ELIGIBLE INSTITUTION

- --------------------------------------------------------------------------------

             (Name of Eligible Institution Guaranteeing Signatures)

- --------------------------------------------------------------------------------

  (Address (including zip code) and Telephone Number (including area code) of
                                     Firm)

- --------------------------------------------------------------------------------

                             (Authorized Signature)

- --------------------------------------------------------------------------------

                                 (Printed Name)

- --------------------------------------------------------------------------------

                                    (Title)

    Dated: ________________________
- --------------------------------------------------------------------------------

                                       6

- -------------------------------------------

                         SPECIAL ISSUANCE INSTRUCTIONS
                              (SEE INSTRUCTION 4)

      To be completed ONLY if certificates for Outstanding Notes in a stated
  amount at maturity not tendered are to be issued in the name of, or the
  Exchange Notes issued pursuant to the Exchange Offer are to be issued to the
  order of, someone other than the person(s) whose signature(s) appear(s)
  within this letter of transmittal or issued to an address different from
  that shown in the box entitled "Description of Outstanding Notes" within
  this letter of transmittal, or if Outstanding Notes tendered by book-entry
  transfer that are not accepted are maintained at DTC other than the account
  at DTC indicated above.

  Name _______________________________________________________________________
                                 (Please Print)

  Address ____________________________________________________________________

  ____________________________________________________________________________
                               (Include Zip Code)

   __________________________________________________________________________
                  (Tax Identification or Social Security No.)

  (See Substitute Form W-9 on Page 12)

- -------------------------------------------
- -------------------------------------------

                         SPECIAL DELIVERY INSTRUCTIONS
                              (SEE INSTRUCTIONS 4)

      To be completed ONLY if certificates for Outstanding Notes in a stated
  amount at maturity not tendered or not accepted for purchase or the Exchange
  Notes issued pursuant to the Exchange Offer are to be sent to someone other
  than the person(s) whose signature(s) appear(s) within this letter of
  transmittal or to an address different from that shown in the box entitled
  "Description of Outstanding Notes" within this letter of transmittal or to
  be credited to an account maintained at DTC other than the account at DTC
  indicated above.

  Name _______________________________________________________________________
                                 (Please Print)

  Address ____________________________________________________________________

  ____________________________________________________________________________
                               (Include Zip Code)

   __________________________________________________________________________
                  (Tax Identification or Social Security No.)

  (See Substitute Form W-9 on Page 12)

- ------------------------------------------

                                       7

                                  INSTRUCTIONS
         FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER

    1.  DELIVERY OF THIS LETTER OF TRANSMITTAL AND CERTIFICATES.  The
certificates for the tendered Outstanding Notes (or a confirmation of a
book-entry into the Exchange Agent's account at DTC of all Outstanding Notes
delivered electronically), as well as a properly completed and duly executed
copy of this letter of transmittal or facsimile hereof and any other documents
required by this letter of transmittal, must be received by the Exchange Agent
at its address set forth on page 1 prior to 5:00 p.m., New York City time, on
the Expiration Date. The method of delivery of the tendered Outstanding Notes,
this letter of transmittal and all other required documents to the Exchange
Agent is at the election and risk of the Holder and, except as otherwise
provided below, the delivery will be deemed made only when actually received by
the Exchange Agent. Instead of delivery by mail, it is recommended that the
Holder use an overnight or hand delivery service. In all cases, sufficient time
should be allowed to assure timely delivery. No letter of transmittal or
Outstanding Notes should be sent to Sun Media.

    Holders who wish to tender their Outstanding Notes and (i) whose Outstanding
Notes are not immediately available or (ii) who cannot deliver their Outstanding
Notes, this letter of transmittal or any other documents required hereby to the
Exchange Agent prior to the Expiration Date, or who cannot complete the
procedure for book-entry transfer on a timely basis, must tender their
Outstanding Notes and follow the guaranteed delivery procedures set forth in the
Prospectus. Pursuant to such procedures: (i) such tender must be made by or
through an Eligible Institution (as defined below); (ii) prior to the Expiration
Date, the Exchange Agent must have received from the Eligible Institution a
properly completed and duly executed Notice of Guaranteed Delivery (by facsimile
transmission, mail or hand delivery) setting forth the name and address of the
Holder of the Outstanding Notes, the certificate number or numbers of such
Outstanding Notes and the stated amount at maturity of Outstanding Notes
tendered, stating that the tender is being made by such Notice of Guaranteed
Delivery and guaranteeing that within three New York Stock Exchange trading days
after the Expiration Date, this letter of transmittal (or a copy of this letter
of transmittal), together with the certificate(s) representing the Outstanding
Notes (or a confirmation of electronic mail delivery of book-entry into the
Exchange Agent's account at DTC) and any other required documents will be
deposited by the Eligible Institution with the Exchange Agent; and (iii) such
properly completed and executed letter of transmittal (or a copy of this letter
of transmittal), as well as all other documents required by this letter of
transmittal and the certificate(s) representing all tendered Outstanding Notes
in proper form for transfer (or a confirmation of electronic mail delivery
book-entry delivery into the Exchange Agent's account at DTC), must be received
by the Exchange Agent within three New York Stock Exchange trading days after
the Expiration Date. Any Holder of Outstanding Notes who wishes to tender
Outstanding Notes pursuant to the guaranteed delivery procedures described above
must ensure that the Exchange Agent receives the Notice of Guaranteed Delivery
prior to 5:00 p.m., New York City time, on the Expiration Date.

    All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of tendered Outstanding Notes will be
determined by Sun Media in its sole discretion, which determination will be
final and binding. Sun Media reserves the absolute right to reject any and all
Outstanding Notes not properly tendered or any Outstanding Notes Sun Media's
acceptance of which would, in the opinion of counsel for Sun Media, be unlawful.
Sun Media also reserves the absolute right to waive any defects, irregularities
or conditions of tender as to particular Outstanding Notes. Sun Media's
interpretation of the terms and conditions of the Exchange Offer (including the
instructions in this letter of transmittal) will be final and binding on all
parties. Unless waived, any defects or irregularities in connection with tenders
of Outstanding Notes must be cured within such time as Sun Media shall
determine. Although Sun Media intends to notify Holders of defects or
irregularities with respect to tenders of Outstanding Notes, neither Sun Media,
the Exchange Agent nor any other person shall be under any duty to give
notification of defects or irregularities with respect to tenders of Outstanding
Notes, nor shall any of them incur any liability for failure to give such
notification. Tenders of Outstanding Notes

                                       8

will not be deemed to have been made until such defects or irregularities have
been cured or waived. Any Outstanding Notes received by the Exchange Agent that
are not properly tendered and as to which the defects or irregularities have not
been cured or waived will be returned without cost by the Exchange Agent to the
tendering Holders of Outstanding Notes, unless otherwise provided in this letter
of transmittal, as soon as practicable following the expiration or termination
of the Exchange Offer.

    2.  PARTIAL TENDERS.  If less than all Outstanding Notes are tendered, the
tendering Holder should fill in the number of Outstanding Notes tendered in the
third column of the chart entitled "Description of Outstanding Notes." All
Outstanding Notes delivered to the Exchange Agent will be deemed to have been
tendered unless otherwise indicated. If not all Outstanding Notes are tendered,
a certificate or certificates representing Exchange Notes issued in exchange of
any Outstanding Notes tendered and accepted will be sent to the Holder at its
registered address, unless a different address is provided in the appropriate
box in this letter of transmittal or unless tender is made through DTC, promptly
after the Outstanding Notes are accepted for exchange.

    3.  SIGNATURE ON THE LETTER OF TRANSMITTAL; BOND POWER AND ENDORSEMENTS;
GUARANTEE OF SIGNATURES.  If this letter of transmittal (or a copy of this
letter of transmittal) is signed by the registered Holder(s) of the Outstanding
Notes tendered herewith, the signature(s) must correspond with the name(s) as
written on the face of the Outstanding Notes without alteration, enlargement or
any change whatsoever.

    If this letter of transmittal (or a copy of this letter of transmittal) is
signed by the registered Holder of Outstanding Notes tendered and the
certificates for Exchange Notes issued in exchange therefor are to be issued (or
certificates for any untendered Outstanding Notes are to be reissued) to the
registered Holder, such Holder need not and should not endorse any tendered
Outstanding Notes, nor provide a separate bond power. In any other case, such
holder must either properly endorse the Outstanding Notes tendered or transmit a
properly completed separate bond power with this letter of transmittal, with the
signature on the endorsement or bond power guaranteed by an Eligible
Institution.

    If this letter of transmittal (or a copy of this letter of transmittal) is
signed by a person other than the registered Holder(s) of the Outstanding Notes,
the Outstanding Notes surrendered for exchange must be endorsed or accompanied
by a properly completed bond power that authorizes such person to tender the
Outstanding Notes on behalf of the registered Holder(s), in either case signed
as the name(s) of the registered Holder(s) appear(s) on the Outstanding Notes.

    If this letter of transmittal (or a copy of this letter of transmittal) or
any Outstanding Notes or bond powers are signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or others
acting in fiduciary or representative capacities, such persons should so
indicate when signing, and unless waived by Sun Media, evidence satisfactory to
Sun Media of their authority to so act must be submitted with this letter of
transmittal.

    Endorsements on Outstanding Notes or signatures on bond powers required by
this Instruction 3 must be guaranteed by an Eligible Institution.

    Signatures on this letter of transmittal (or a copy of this letter of
transmittal) or a notice of withdrawal, as the case may be, must be guaranteed
by a member firm of a registered national securities exchange, a member firm of
the National Association of Securities Dealers, Inc., a commercial bank or trust
company having an office or correspondent in the United States or an "eligible
guarantor institution" within the meaning of Rule 17Ad-15 under the Exchange Act
(an "Eligible Institution"), unless the Outstanding Notes tendered pursuant
hereto are tendered (i) by a registered Holder (including any participant in DTC
whose name appears on a security position listing as the owner of Outstanding
Notes) who has not completed the box on page 7 entitled "Special Issuance
Instructions" or "Special Delivery Instructions" of this letter of transmittal
or (ii) for the account of an Eligible Institution.

                                       9

    4.  SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS.  Tendering Holders should
include, in the applicable spaces, the name and address to which Exchange Notes
or substitute Outstanding Notes for stated amounts at maturity not tendered or
not accepted for exchange are to be sent, if different from the name and address
of the person signing this letter of transmittal (or in the case of tender of
the Outstanding Notes through DTC, if different from the account maintained at
DTC indicated above). In the case of issuance in a different name, the taxpayer
identification number or social security number of the person named must also be
provided.

    5.  TRANSFER TAXES.  Sun Media shall pay all transfer taxes, if any,
applicable to the exchange of Outstanding Notes pursuant to the Exchange Offer.
If, however, certificates representing Exchange Notes, or certificates
representing Outstanding Notes for stated amounts at maturity not tendered or
accepted for exchange, are to be delivered to, or are to be issued in the name
of, any person other than the registered Holder of the Outstanding Notes being
tendered, or if transfer taxes are imposed for any reason other than the
exchange of Outstanding Notes pursuant to the Exchange Offer, then the amount of
any transfer taxes (whether imposed on the registered Holder or any other
person) will be payable by the tendering Holder. If satisfactory evidence of
payment of such taxes or exemption therefrom is not submitted herewith, the
amount of such transfer taxes will be billed directly to such tendering Holder.

    Except as provided in this Instruction 5, it will not be necessary for
transfer tax stamps to be affixed to the Outstanding Notes listed in this letter
of transmittal.

    6.  AMENDMENT OR WAIVER OF CONDITIONS.  Sun Media reserves the absolute
right to amend, waive or modify, in whole or in part, any of the conditions to
the Exchange Offer set forth in the Prospectus.

    7.  MUTILATED, LOST, STOLEN OR DESTROYED NOTES.  Any Holder whose
Outstanding Notes have been mutilated, lost, stolen or destroyed should contact
the Exchange Agent at the address indicated above for further instructions.

    8.  REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES.  Questions relating to the
Exchange Offer, requests for assistance and requests for additional copies of
the Prospectus and this letter of transmittal may be directed to the Exchange
Agent at the address and telephone number set forth above.

    9.  NO CONDITIONAL TENDERS.  No alternative, conditional or contingent
tenders will be accepted. All tendering Holders of Outstanding Notes, by
execution of this letter of transmittal, waive any right to receive notice of
the acceptance of their Outstanding Notes for exchange.

    10.  WITHDRAWAL OF TENDERS.  Tenders of Outstanding Notes may be withdrawn
at any time prior to 5:00 p.m., New York City time, on the Expiration Date.

    For a withdrawal of a tender of Outstanding Notes to be effective, a written
or facsimile notice of withdrawal must be received by the Exchange Agent at its
address set forth above prior to 5:00 p.m., New York City time, on the
Expiration Date. Any such notice of withdrawal must (i) specify the name of the
person who deposited the Outstanding Notes to be withdrawn, (ii) identify the
Outstanding Notes to be withdrawn (including the principal amounts of such
Outstanding Notes), (iii) be signed by the Holder in the same manner as the
original signature on this letter of transmittal (including any required
signature guarantees) or be accompanied by documents of transfer sufficient to
have the trustee under the Indenture register the transfer of such Outstanding
Notes into the name of the person withdrawing the tender and (iv) specify the
name in which any such Outstanding Notes are to be registered, if different from
that of the Holder. If the Holder delivered or otherwise identified certificates
representing Outstanding Notes to the Exchange Agent, then the Holder must
submit the serial numbers of the certificates to be withdrawn. If
the Outstanding Notes were tendered as a book-entry transfer, the notice of
withdrawal must specify the

                                       10

name and number of the account at DTC to be credited with the withdrawn
Outstanding Notes and otherwise comply with the procedures of DTC.

    11.  DEFINITIONS.  Capitalized terms used but not defined in this letter of
transmittal shall have the respective meanings set forth in the Prospectus.

    IMPORTANT: THIS LETTER OF TRANSMITTAL OR A FACSIMILE THEREOF (TOGETHER WITH
CERTIFICATES FOR OUTSTANDING NOTES AND ALL OTHER REQUIRED DOCUMENTS) OR A NOTICE
OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO THE
EXPIRATION DATE.

                                       11

                           IMPORTANT TAX INFORMATION

    The Holder is required to give the Exchange Agent its social security number
or employer identification number. If the Notes are in more than one name or are
not in the name of the actual owner, consult the enclosed Guidelines for
Certification of Taxpayer Identifying Number on Substitute Form W-9
for additional guidance on which number to report.

                    TO BE COMPLETED BY ALL TENDERING HOLDERS

                                                                            
- -----------------------------------------------------------------------------------------------------------------
                                     PAYOR'S NAME:    SUN MEDIA CORPORATION
- -----------------------------------------------------------------------------------------------------------------

         SUBSTITUTE               Please fill out your name and address below:
          FORM W-9
 Department Of The Treasury       Name:
  Internal Revenue Service

Payor's Request For Taxpayer      Address (Number and street):
Identification Number (TIN)
                                  City, State and Zip Code:
                                  ----------------------------------------------------------------------------

                                  PART I -- PLEASE PROVIDE YOUR TIN IN THE                     TIN:
                                  BOX AT RIGHT AND CERTIFY BY SIGNING AND           (Social Security Number or
                                  DATING BELOW                                    Employer Identification Number)
- -----------------------------------------------------------------------------------------------------------------

                                  PART II -- CERTIFICATION -- UNDER               PART III --
                                  PENALTIES OF PERJURY, I CERTIFY THAT:           ------------------------------
                                  (1) The number shown on this form is my         Awaiting TIN      / /
                                  correct Taxpayer Identification Number (or      ------------------------------
                                  I am waiting for a number to be issued to       Exempt           / /
                                  me) and (2) I am not subject to backup
                                  withholding because (a) I am exempt from
                                  backup withholding, or (b) I have not been
                                  notified by the Internal Revenue Service
                                  (the "IRS") that I am subject to backup
                                  withholding as a result of failure to
                                  report all interest and dividends, or
                                  (c) the IRS has notified me that I am no
                                  longer subject to backup withholding.

- -----------------------------------------------------------------------------------------------------------------



                                                           
- -----------------------------------------------------------------------------------------------------

CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the IRS
  that you are subject to backup withholding because of under-reporting interest or dividends on your
tax return. However, if after being notified by the IRS that you were subject to backup withholding
you received another notification from the IRS stating that you are no longer subject to backup
withholding, do not cross out item (2). If you are exempt from backup withholding, check the
applicable box in Part 3.

Signature                                                     Date

Name (Please Print)

Address (Number and street)

City, State and Zip Code
- -----------------------------------------------------------------------------------------------------



    
NOTE:  FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN
       BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU UNDER
       THE NOTES. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR
       CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
       SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.



                                       12

YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE APPLICABLE BOX IN
PART 3 OF SUBSTITUTE FORM W-9.

             CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER

    I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (a) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or
(b) I intend to mail or deliver an application in the near future. I understand
that if I do not provide a taxpayer identification number to the payor by the
time of payment, 31% of all reportable payments made to me will be withheld
until I provide a number and that, if I do not provide my taxpayer
identification number within 60 days, such retained amounts shall be remitted to
the IRS as backup withholding.

                                                
- -------------------------------------------        -------------------------------------------
                 Signature                                             Date



IMPORTANT: THIS LETTER OF TRANSMITTAL (TOGETHER WITH CERTIFICATES FOR
OUTSTANDING NOTES AND ALL OTHER REQUIRED DOCUMENTS) OR A NOTICE OF GUARANTEED
DELIVERY MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO 5:00 P.M., NEW
YORK CITY TIME ON THE EXPIRATION DATE.

                         (DO NOT WRITE IN SPACE BELOW)



- ----------------------------------------------------------------------------------------
        CERTIFICATE                   OUTSTANDING                   OUTSTANDING
        SURRENDERED                  NOTES TENDERED                NOTES ACCEPTED
- ----------------------------------------------------------------------------------------
                                                      
- ----------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------------
    DELIVERY PREPARED BY               CHECKED BY                       DATE
- ----------------------------------------------------------------------------------------


                                       13

EX-99.2

                                                                    Exhibit 99.2

                         NOTICE OF GUARANTEED DELIVERY
                                      FOR
             TENDER OF ALL OUTSTANDING 7 5/8% SENIOR NOTES DUE 2013
                                IN EXCHANGE FOR
                          7 5/8% SENIOR NOTES DUE 2013
                        THAT HAVE BEEN REGISTERED UNDER
                    THE SECURITIES ACT OF 1933, AS AMENDED,
                                       OF
                             SUN MEDIA CORPORATION

    Registered holders of outstanding 7 5/8% Senior Notes due 2013 (the
"Outstanding Notes") of Sun Media Corporation ("Sun Media") who wish to tender
their Outstanding Notes in exchange for a like stated amount at maturity of
7 5/8% Senior Notes due 2013 (the "Exchange Notes") of Sun Media and, in each
case, whose Outstanding Notes are not immediately available or who cannot
deliver their Outstanding Notes and letter of transmittal (and any other
documents required by the letter of transmittal) to National City Bank (the
"Exchange Agent"), prior to the Expiration Date, may use this Notice of
Guaranteed Delivery or one substantially equivalent hereto. This Notice of
Guaranteed Delivery may be delivered by hand or sent by facsimile transmission
(receipt confirmed by telephone and an original delivered by guaranteed
overnight delivery) or mail to the Exchange Agent. See "The Exchange Offer --
Procedures for Tendering Outstanding Notes" in the Prospectus. THE EXCHANGE
OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON JUNE             , 2003
(THE "EXPIRATION DATE"), UNLESS THE OFFER IS EXTENDED BY SUN MEDIA IN ITS SOLE
DISCRETION. TENDERS OF OUTSTANDING NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO
5:00 PM., NEW YORK CITY TIME, ON THE EXPIRATION DATE.

                 The Exchange Agent for the Exchange Offer is:

                                                          
                                      NATIONAL CITY BANK
                                          DELIVER TO:

           BY MAIL:             BY HAND OR OVERNIGHT DELIVERY:          NEW YORK DROP:
      National City Bank              National City Bank              National City Bank
       P.O. Box 92301             Corporate Trust Operations     The Depository Trust Company
           LOC #5352              4100 West 150th Street, 3rd     Transfer Agent Drop Service
  Cleveland, Ohio 44193-0900                 Floor                      55 Water Street
                                           LOC #5352                Jeanette Park Entrance
                                  Cleveland, Ohio 44135-1385       New York, New York 10041

                                         BY FACSIMILE:
                                        (216) 222-9326
                                     Confirm By Telephone:
                                        (216) 222-2552
                                     Attn: Holly Pattison



    FOR ANY QUESTIONS REGARDING THIS NOTICE OF GUARANTEED DELIVERY OR FOR ANY
ADDITIONAL INFORMATION, YOU MAY CONTACT THE EXCHANGE AGENT BY TELEPHONE AT
(216) 222-2552, OR BY FACSIMILE AT (216) 222-9326.

    DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE TRANSMISSION TO
A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.

    This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a letter of transmittal is required to be
guaranteed by an Eligible Institution, such signature guarantee must appear in
the applicable space provided on the letter of transmittal for Guarantee of
Signatures.

LADIES & GENTLEMEN:

    The undersigned hereby tender(s) to Sun Media, upon the terms and subject to
the conditions set forth in the Prospectus and the accompanying letter of
transmittal, receipt of which is hereby acknowledged, the aggregate stated
amount at maturity of Outstanding Notes set forth below pursuant to the
guaranteed delivery procedures set forth in the Prospectus.

    The undersigned understands that tenders of Outstanding Notes will be
accepted only in stated amounts at maturity equal to $1,000 or integral
multiples of $1,000. The undersigned understands that tenders of Outstanding
Notes pursuant to the Exchange Offer may not be withdrawn after 5:00 p.m.,
New York City time, on the Expiration Date. Tenders of Outstanding Notes may
also be withdrawn if the Exchange Offer is terminated without any such
Outstanding Notes being purchased thereunder or as otherwise provided in the
Prospectus.

    All authority conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall survive the death or incapacity of the undersigned and
every obligation of the undersigned under this Notice of Guaranteed Delivery
shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and other legal
representatives of the undersigned.

                            PLEASE SIGN AND COMPLETE

                                                
Signature(s) of Registered Owner(s) or             Name(s) of Registered Holder(s):
Authorized Signatory:                              -------------------------------------------
- -------------------------------------------        -------------------------------------------
- -------------------------------------------        -------------------------------------------
- -------------------------------------------        Address:
Stated Amount at Maturity of Outstanding           -------------------------------------------
Notes Tendered: ----------------------------       Area Code and Telephone No.: --------------
Certificate No(s). of Outstanding Notes            If Outstanding Notes will be delivered by
(if available):                                    book-entry transfer at The Depository Trust
- -------------------------------------------        Company, insert Depository Account No.:
- -------------------------------------------        -------------------------------------------
Date: -------------------------------------



    This Notice of Guaranteed Delivery must be signed by the registered
holder(s) of Outstanding Notes exactly as its (their) name(s) appear on
certificates for Outstanding Notes or on a security position listing as the
owner of Outstanding Notes, or by person(s) authorized to become registered
Holder(s) by endorsements and documents transmitted with this Notice of
Guaranteed Delivery. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer or other person acting in a fiduciary or
representative capacity, such person must provide the following information.

                      PLEASE PRINT NAME(S) AND ADDRESS(ES)

Name(s):
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

Capacity:
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

Address(es):
- -------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------

DO NOT SEND OUTSTANDING NOTES WITH THIS FORM. OUTSTANDING NOTES SHOULD BE SENT
TO THE EXCHANGE AGENT TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED
LETTER OF TRANSMITTAL.

                             GUARANTEE OF DELIVERY
                    (NOT TO BE USED FOR SIGNATURE GUARANTEE)

    The undersigned, a member firm of a registered national securities exchange
or of the National Association of Securities Dealers, Inc. or a commercial bank
or trust company having an office or a correspondent in the United States or an
"eligible guarantor institution" as defined by Rule 17Ad-15 under the Exchange
Act, hereby (a) represents that each holder of Outstanding Notes on whose behalf
this tender is being made "own(s)" the Outstanding Notes covered hereby within
the meaning of Rule 14e-4 under the Securities Exchange Act of 1934, as amended,
(b) represents that such tender of Outstanding Notes complies with such
Rule 14e-4, and (c) guarantees that, within three New York Stock Exchange
trading days from the date of this Notice of Guaranteed Delivery, a properly
completed and duly executed letter of transmittal, together with certificates
representing the Outstanding Notes covered hereby in proper form for transfer
and required documents will be deposited by the undersigned with the Exchange
Agent.

    THE UNDERSIGNED ACKNOWLEDGES THAT IT MUST DELIVER THE LETTER OF TRANSMITTAL
AND OUTSTANDING NOTES TENDERED HEREBY TO THE EXCHANGE AGENT WITHIN THE TIME SET
FORTH ABOVE AND THAT FAILURE TO DO SO COULD RESULT IN FINANCIAL LOSS TO THE
UNDERSIGNED.

                                                
Name of Firm:                                      Authorized Signature
Address:

- -------------------------------------------        -------------------------------------------

Area Code and Telephone No.: ---------------       Name: -------------------------------------

- -------------------------------------------        Title:
                                                   --------------------------------------

                                                   Date: -------------------------------------

EX-99.3

                                                                    Exhibit 99.3

            TENDER FOR ALL OUTSTANDING 7 5/8% SENIOR NOTES DUE 2013
                                IN EXCHANGE FOR
                          7 5/8% SENIOR NOTES DUE 2013
                        THAT HAVE BEEN REGISTERED UNDER
                    THE SECURITIES ACT OF 1933, AS AMENDED,
                                       OF
                             SUN MEDIA CORPORATION

To Registered Holders:

    We are enclosing herewith the material listed below relating to the offer
(the "Exchange Offer") by Sun Media Corporation ("Sun Media") to exchange its
7 5/8% Senior Notes due 2013 (the "Exchange Notes"), which have been registered
under the Securities Act of 1933, as amended (the "Securities Act"), for a like
stated amount at maturity of Sun Media's issued and outstanding 7 5/8% Senior
Notes due 2013 (the "Outstanding Notes") upon the terms and subject to the
conditions set forth in the Prospectus, dated March [  ], 2003, and the related
letter of transmittal.

    Enclosed herewith are copies of the following documents:

    1.  Prospectus dated March [  ], 2003;

    2.  Letter of transmittal including the Guidelines for Certification of
       Taxpayer Identifying Number;

    3.  Notice of Guaranteed Delivery;

    4.  Instruction to Registered Holder from Beneficial Owner; and

    5.  Letter which may be sent to your clients for whose account you hold
       Outstanding Notes in your name or in the name of your nominee, to
       accompany the instruction form referred to above, for obtaining such
       client's instruction with regard to the Exchange Offer.

    WE URGE YOU TO CONTACT YOUR CLIENTS PROMPTLY. PLEASE NOTE THAT THE EXCHANGE
OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON             , 2003,
UNLESS EXTENDED.

    The Exchange Offer is not conditioned upon any minimum number of Outstanding
Notes being tendered.

    Pursuant to the letter of transmittal, each holder of Outstanding Notes will
represent to Sun Media that (i) the Exchange Notes acquired pursuant to the
Exchange Offer are being obtained in the ordinary course of business of the
person receiving such Exchange Notes, whether or not such person is such holder,
(ii) neither the holder of the Outstanding Notes nor any such other person has
an arrangement or understanding with any person to participate in the
distribution of such Exchange Notes, (iii) if the holder is not a broker-dealer,
or is a broker-dealer but will not receive Exchange Notes for its own account in
exchange for Outstanding Notes, neither the holder nor any such other person is
engaged in or intends to participate in a distribution of the Exchange Notes and
(iv) neither the holder nor any such other person is an "affiliate" of Sun Media
within the meaning of Rule 405 under the Securities Act or, if such person is an
"affiliate," that such holder will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable. If the
tendering holder is a broker-dealer that will receive Exchange Notes for its own
account in exchange for Outstanding Notes, such tendering holder will represent
on behalf of such broker-dealer that the Outstanding Notes to be exchanged for
the Exchange Notes were acquired by it as a result of market-making activities
or other trading activities, and acknowledge on behalf of such broker-dealer
that it will deliver a prospectus meeting the requirements of the Securities Act
in connection with any resale of such Exchange Notes. By acknowledging that it
will deliver and by delivering a prospectus meeting the requirements of the
Securities Act in connection with any resale of such Exchange Notes, the

undersigned is not deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.

    The enclosed Instruction to Registered Holder from Beneficial Owner contains
an authorization by the beneficial owner of the Outstanding Notes for you to
make the foregoing representations.

    Sun Media will not pay any fee or commission to any broker or dealer or to
any other persons (other than the Exchange Agent for the Exchange Offer) in
connection with the solicitation of tenders of Outstanding Notes pursuant to the
Exchange Offer. Sun Media will pay or cause to be paid any transfer taxes
payable on the transfer of Outstanding Notes to it, except as otherwise provided
in Instruction 5 of the enclosed letter of transmittal.

    Any inquiries you may have with respect to the Exchange Offer may be
addressed to, and additional copies of the enclosed materials may be obtained
from, the Exchange Agent, National City Bank, in the manner set forth below.

    The Exchange Agent for the Exchange Offer is:

                               NATIONAL CITY BANK
                                  DELIVER TO:



          BY MAIL:             BY HAND OR OVERNIGHT DELIVERY:         NEW YORK DROP:
                                                         
     National City Bank             National City Bank              National City Bank
      P.O. Box 92301            Corporate Trust Operations     The Depository Trust Company
          LOC #5352             4100 West 150th Street, 3rd     Transfer Agent Drop Service
 Cleveland, Ohio 44193-0900                Floor                      55 Water Street
                                         LOC #5352                Jeanette Park Entrance
                                Cleveland, Ohio 44135-1385       New York, New York 10041
                                       BY FACSIMILE:
                                      (216) 222-9326
                                   CONFIRM BY TELEPHONE:
                                      (216) 222-2552
                                 Attention: Holly Pattison


                                          Very truly yours,

                                          SUN MEDIA CORPORATION

NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU THE
AGENT OF SUN MEDIA OR THE EXCHANGE AGENT, OR AUTHORIZE YOU TO USE ANY DOCUMENT
OR MAKE ANY STATEMENT ON THEIR BEHALF IN CONNECTION WITH THE EXCHANGE OFFER
OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.

             INSTRUCTION TO REGISTERED HOLDER FROM BENEFICIAL OWNER
                                       OF
                          7 5/8% SENIOR NOTES DUE 2013
                                       OF
                             SUN MEDIA CORPORATION

To Registered Holder:

    The undersigned hereby acknowledges receipt of the Prospectus dated March
[  ], 2003 (the "Prospectus") of Sun Media Corporation ("Sun Media"), and
accompanying letter of transmittal, that together constitute Sun Media's offer
(the "Exchange Offer") to exchange $1,000 in stated amount at maturity of a new
series of 7 5/8% Senior Notes due 2013 that have been registered under the
Securities Act of 1933, as amended, (the "Exchange Notes") of Sun Media for each
$1,000 in stated amount at maturity of outstanding 7 5/8% Senior Notes due 2013
(the "Outstanding Notes") of Sun Media. Capitalized terms used but not defined
herein have the meanings ascribed to them in the Prospectus.

    This will instruct you, the registered holder, as to the action to be taken
by you relating to the Exchange Offer with respect to the Outstanding Notes held
by you for the account of the undersigned.

    The aggregate face amount of the Outstanding Notes held by you for the
account of the undersigned is (fill in amount):

    $              of 7 5/8% Senior Notes due 2013.

    With respect to the Exchange Offer, the undersigned hereby instructs you
(check appropriate box):

    / / To TENDER the following Outstanding Notes held by you for the account of
the undersigned (insert stated amount at maturity of Outstanding Notes to be
tendered (if any)):

    $              of 7 5/8% Senior Notes due 2013.

    / / NOT to TENDER any Outstanding Notes held by you for the account of the
undersigned.

    If the undersigned instructs you to tender Outstanding Notes held by you for
the account of the undersigned, it is understood that you are authorized to
make, on behalf of the undersigned (and the undersigned, by its signature below,
hereby makes to you), the representations and warranties contained in the letter
of transmittal that are to be made with respect to the undersigned as a
beneficial owner, including but not limited to the representations, that
(i) the Exchange Notes acquired pursuant to the Exchange Offer are being
obtained in the ordinary course of business of the undersigned, (ii) neither the
undersigned nor any such other person has an arrangement or understanding with
any person to participate in the distribution of such Exchange Notes, (iii) if
the undersigned is not a broker-dealer, or is a broker-dealer but will not
receive Exchange Notes for its own account in exchange for Outstanding Notes,
neither the undersigned nor any such other person is engaged in or intends to
participate in the distribution of such Exchange Notes and (iv) neither the
undersigned nor any such other person is an "affiliate" of Sun Media within the
meaning of Rule 405 under the Securities Act, or, if the undersigned is an
"affiliate," that the undersigned will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent applicable.
If the undersigned is a broker-dealer (whether or not it is also an "affiliate")
that will receive Exchange Notes for its own account in exchange for Outstanding
Notes, it represents that such Outstanding Notes were acquired as a result of
market-making activities or other trading activities, and it acknowledges that
it will deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Notes. By acknowledging that it will
deliver and by delivering a prospectus meeting the requirements of the
Securities Act in connection with any resale of such Exchange Notes, the
undersigned is not deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.

                                   SIGN HERE

- --------------------------------------------------------------------------------
                  Name of beneficial owner(s) (please print):

- --------------------------------------------------------------------------------
                                 Signature(s):

- --------------------------------------------------------------------------------
                                    Address:

- --------------------------------------------------------------------------------
                               Telephone Number:

- --------------------------------------------------------------------------------
               Taxpayer identification or Social Security Number:

- --------------------------------------------------------------------------------
                                     Date:

- --------------------------------------------------------------------------------

EX-99.4

                                                                    Exhibit 99.4

                           TENDER FOR ALL OUTSTANDING
                          7 5/8% SENIOR NOTES DUE 2013
                                IN EXCHANGE FOR
                          7 5/8% SENIOR NOTES DUE 2013
                        THAT HAVE BEEN REGISTERED UNDER
                    THE SECURITIES ACT OF 1933, AS AMENDED,
                                       OF
                             SUN MEDIA CORPORATION

    We are enclosing herewith a Prospectus, dated March [  ], 2003, of Sun Media
Corporation ("Sun Media"), and a related letter of transmittal (which together
constitute the "Exchange Offer") relating to the offer by Sun Media, to exchange
its 7 5/8% Senior Notes due 2013 (the "Exchange Notes"), which have been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
for a like stated amount at maturity of its issued and outstanding 7 5/8% Senior
Notes due 2013 (the "Outstanding Notes") upon the terms and subject to the
conditions set forth in the Exchange Offer.

    PLEASE NOTE THAT THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON             , 2003, UNLESS EXTENDED BY SUN MEDIA IN ITS SOLE
DISCRETION.

    THE EXCHANGE OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF OUTSTANDING
NOTES BEING TENDERED.

    We are the holder of record of Outstanding Notes held by us for your
account. A tender of such Outstanding Notes can be made only by us as the record
holder and pursuant to your instructions. The letter of transmittal is furnished
to you for your information only and cannot be used by you to tender Outstanding
Notes held by us for your account.

    We request instructions as to whether you wish to tender any or all of the
Outstanding Notes held by us for your account pursuant to the terms and
conditions of the Exchange Offer. Please so instruct us by completing, executing
and returning to us the enclosed Instruction to Registered Holder from
Beneficial Holder enclosed herewith. We also request that you confirm with such
instruction form that we may on your behalf make the representations contained
in the letter of transmittal.

    Pursuant to the letter of transmittal, each holder of Outstanding Notes will
represent to Sun Media that (i) the Exchange Notes acquired in the Exchange
Offer are being obtained in the ordinary course of business of the person
receiving such Exchange Notes, whether or not such person is such holder,
(ii) neither the holder of the Outstanding Notes nor any such other person has
an arrangement or understanding with any person to participate in the
distribution of such Exchange Notes, (iii) if the holder is not a broker-dealer
or is a broker-dealer but will not receive Exchange Notes for its own account in
exchange for Outstanding Notes, neither the holder nor any such other person is
engaged in or intends to participate in a distribution of the Exchange Notes and
(iv) neither the holder nor any such other person is an "affiliate" of Sun Media
within the meaning of Rule 405 under the Securities Act or, if such holder is an
"affiliate," that such holder will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable. If the
tendering holder is a broker-dealer (whether or not it is also an "affiliate")
that will receive Exchange Notes for its own account in exchange for Outstanding
Notes, we will represent on behalf of such broker-dealer that the Outstanding
Notes to be exchanged for the Exchange Notes were acquired by it as a result of
market-making activities or other trading activities, and acknowledge on behalf
of such broker-dealer that it will deliver a prospectus meeting the requirements
of the Securities Act in connection with any resale of such Exchange Notes. By
acknowledging that it will deliver and by delivering a prospectus meeting the
requirements of the Securities Act in connection with any resale of such
Exchange Notes, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

                                          Very truly yours,

              GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFYING
                         NUMBER ON SUBSTITUTE FORM W-9

    GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYOR -- Social Security numbers have nine digits separated by two hyphens:
i.e. 000-00-0000. Employer identification numbers have nine digits separated by
only one hyphen: i.e. 00-0000000. The table below will help determine the number
to give the payor.


- ---------------------------------------------------------------------------------------
                                                  GIVE THE SOCIAL SECURITY NUMBER OR
FOR THIS TYPE OF ACCOUNT:                        EMPLOYER IDENTIFICATION NUMBER OF --
- ---------------------------------------------------------------------------------------
                                         
1.   An individual                             The individual
2.   Two or more individuals (joint account)   The actual owner of the account or, if
                                               combined funds, the first individual on
                                               the account(1)
3.   Husband and wife (joint account)          The actual owner of the account or, if
                                               combined funds, the first spouse on the
                                               account(1)
4.   Custodian account of a minor (Uniform     The minor(2)
     Gift to Minors Act)
5.   Adult and minor (joint account)           The adult or, if the minor is the only
                                               contributor, the minor(1)
6.   Account in the name of guardian or        The ward, minor, or incompetent
     committee for a designated ward, minor,   person(3)
     or incompetent person
7.   (a) The usual revocable savings trust     The grantor-trustee(1)
         (grantor is also trustee)
     (b) So-called trust account that is not   The actual owner(1)
     a legal or valid trust under State law
8.   Sole proprietorship                       The owner(4)
9.   A valid trust, estate, or pension trust   The legal entity (do not furnish the
                                               taxpayer identifying number of the
                                               personal representative or trustee
                                               unless the legal entity itself is not
                                               designated in the account title.)(5)
10.  Corporate                                 The corporation
11.  Religious, charitable, or educational     The organization
     organization
12.  Association, club, or other tax-exempt    The organization
     organization
13.  Partnership (account held in the name of  The partnership
     the business)
14.  A broker or registered nominee            The broker or nominee
15.  Account with the Department of            The public entity
     Agriculture in the name of a public
     entity (such as a State or local
     government, school district, or prison)
     that receives agricultural program
     payments


- --------------------------------------------------------------------------------

(1) List first and circle the name of the person whose number you furnish. If
    only one person on a joint account has a social security number, that
    person's social security number must be furnished.

(2) Circle the minor's name and furnish the minor's social security number.

(3) Circle the ward's, minor's or incompetent person's name and furnish such
    person's social security number.

(4) You must show your individual name, but you may also enter business or
    "doing business as" name. You may use either your social security number or
    your employer identification number (if you have one).

(5) List first and circle the name of the legal trust, estate, or pension trust.

NOTE: If no name is circled when there is more than one name, the number will be
    considered to be that of the first name listed.