Exhibit 10.4

Abitibi-Consolidated Company of Canada

15.5% Senior Notes due 2010

unconditionally guaranteed as to the

payment of principal, premium,

if any, and interest by the Guarantors named on Schedule I hereto

 

 

Exchange and Registration Rights Agreement

April 1, 2008

Goldman, Sachs & Co.

85 Broad Street

New York, New York 10004

Ladies and Gentlemen:

Abitibi-Consolidated Company of Canada, a company amalgamated under the laws of
Quebec (the “Company”), proposes to exchange certain outstanding notes of the
Company, Abitibi-Consolidated Inc., a corporation amalgamated under the laws of
Canada, and Abitibi-Consolidated Finance L.P., a Delaware limited partnership
(collectively, the “ACI Notes”), for a combination of cash and up to $320.0
million in aggregate principal amount of its 15.5% Senior Notes due 2010
specified above (the “Exchange Offer”), which are unconditionally guaranteed by
the Guarantors (as defined herein). As an inducement to the holders of ACI Notes
to exchange ACI Notes and in satisfaction of a condition to the obligations of
the Company under the Exchange Offer, the Company and the Guarantors agree with
Goldman, Sachs & Co., as dealer managers in connection with the Exchange Offer
(the “Dealer Managers”), for the benefit of the holders (as defined herein) from
time to time of the Registrable Securities (as defined herein) as follows:

1. Certain Definitions. For purposes of this Exchange and Registration Rights
Agreement (this “Agreement”), the following terms shall have the following
respective meanings:

“Base Interest” shall mean the interest that would otherwise accrue on the
Securities under the terms thereof and the Indenture, without giving effect to
the provisions of this Agreement.

The term “broker-dealer” shall mean any broker or dealer registered with the
Commission under the Exchange Act.

“Business Day” shall have the meaning set forth in Rule 13e-4(a)(3) promulgated
by the Commission under the Exchange Act, as the same may be amended or
succeeded from time to time.

“Closing Date” shall mean the date on which the Securities are initially issued.

 

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“Commission” shall mean the United States Securities and Exchange Commission, or
any other federal agency at the time administering the Exchange Act or the
Securities Act, whichever is the relevant statute for the particular purpose.

“Dealer Managers Agreement” shall mean the Dealer Managers Agreement, dated as
of March 10, 2008, as amended, between the Goldman, Sachs & Co., and the Company
relating to the Exchange Offer and the Securities.

“EDGAR System” means the EDGAR filing system of the Commission and the rules and
regulations pertaining thereto promulgated by the Commission in Regulation S-T
under the Securities Act and the Exchange Act, in each case as the same may be
amended or succeeded from time to time (and without regard to format).

“Effective Time,” in the case of (i) an Exchange Registration, shall mean the
time and date as of which the Commission declares the Exchange Registration
Statement effective or as of which the Exchange Registration Statement otherwise
becomes effective and (ii) a Shelf Registration, shall mean the time and date as
of which the Commission declares the Shelf Registration Statement effective or
as of which the Shelf Registration Statement otherwise becomes effective.

“Electing Holder” shall mean any holder of Registrable Securities that has
returned a completed and signed Notice and Questionnaire to the Company in
accordance with Section 3(d)(ii) or Section 3(d)(iii) and the instructions set
forth in the Notice and Questionnaire.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the Commission thereunder, as the same
may be amended or succeeded from time to time.

“Exchange Offer” shall have the meaning assigned thereto in Section 2(a).

“Exchange Registration” shall have the meaning assigned thereto in Section 3(c).

“Exchange Registration Statement” shall have the meaning assigned thereto in
Section 2(a).

“Exchange Securities” shall have the meaning assigned thereto in Section 2(a).

“FINRA” shall mean the Financial Industry Regulatory Authority, Inc.

“Guarantor” shall have the meaning assigned thereto in the Indenture.

The term “holder” shall mean each of the persons who acquire Registrable
Securities from time to time (including any successors or assigns), in each case
for so long as such person owns any Registrable Securities.

“Indenture” shall mean the Indenture, dated as of April 1, 2008, between the
Company, the Guarantors and Wells Fargo Bank, National Association, as trustee,
as the same may be amended from time to time.

“Notice and Questionnaire” means a Notice of Registration Statement and Selling
Securityholder Questionnaire substantially in the form of Exhibit A hereto.

 

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The term “person” shall mean a corporation, limited liability company,
association, partnership, organization, business, individual, government or
political subdivision thereof or governmental agency.

“Registrable Securities” shall mean the Securities; provided, however, that a
Security shall cease to be a Registrable Security upon the earliest to occur of
the following: (i) in the circumstances contemplated by Section 2(a), the
Security has been exchanged for an Exchange Security in an Exchange Offer as
contemplated in Section 2(a) (provided that any Exchange Security that, pursuant
to the last two sentences of Section 2(a), is included in a prospectus for use
in connection with resales by broker-dealers shall be deemed to be a Registrable
Security with respect to Sections 5, 6 and 9 until resale of such Registrable
Security has been effected within the 90-day period referred to in
Section 2(a)); (ii) in the circumstances contemplated by Section 2(b), a Shelf
Registration Statement registering such Security under the Securities Act has
been declared or becomes effective and such Security has been sold or otherwise
transferred by the holder thereof pursuant to and in a manner contemplated by
such effective Shelf Registration Statement; (iii) subject to Section 8(b), such
Security is actually sold by the holder thereof pursuant to Rule 144 under
circumstances in which any legend borne by such Security relating to
restrictions on transferability thereof, under the Securities Act or otherwise,
is removed by the Company or pursuant to the Indenture; or (iv) such Security
shall cease to be outstanding.

“Registration Default” shall have the meaning assigned thereto in Section 2(c).

“Registration Default Period” shall have the meaning assigned thereto in
Section 2(c).

“Registration Expenses” shall have the meaning assigned thereto in Section 4.

“Resale Period” shall have the meaning assigned thereto in Section 2(a).

“Restricted Holder” shall mean (i) a holder that is an affiliate of the Company
within the meaning of Rule 405, (ii) a holder who acquires Exchange Securities
outside the ordinary course of such holder’s business, (iii) a holder who has
arrangements or understandings with any person to participate in the Exchange
Offer for the purpose of distributing Exchange Securities and (iv) a holder that
is a broker-dealer, but only with respect to Exchange Securities received by
such broker-dealer pursuant to an Exchange Offer in exchange for Registrable
Securities acquired by the broker-dealer directly from the Company.

“Rule 144,” “Rule 405”, “Rule 415”, “Rule 424”, “Rule 430B” and “Rule 433” shall
mean, in each case, such rule promulgated by the Commission under the Securities
Act (or any successor provision), as the same may be amended or succeeded from
time to time.

“Securities” shall mean, collectively, up to $320.0 million in aggregate
principal amount of the Company’s 15.5% Senior Notes due 2010 to be issued to
the holders in the Exchange Offer, and securities issued in exchange therefor or
in lieu thereof pursuant to the Indenture. Each Security is entitled to the
benefit of the guarantees provided by the Guarantors in the Indenture (the
“Guarantees”) and, unless the context otherwise requires, any reference herein
to a “Security,” an “Exchange Security” or a “Registrable Security” shall
include a reference to the related Guarantees.

“Securities Act” shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated by the Commission thereunder, as the same may
be amended or succeeded from time to time.

 

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“Shelf Registration” shall have the meaning assigned thereto in Section 2(b).

“Shelf Registration Statement” shall have the meaning assigned thereto in
Section 2(b).

“Special Interest” shall have the meaning assigned thereto in Section 2(c).

“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended,
and the rules and regulations promulgated by the Commission thereunder, as the
same may be amended or succeeded from time to time.

“Trustee” shall mean Wells Fargo Bank, National Association, as trustee under
the Indenture, together with any successors thereto in such capacity.

Unless the context otherwise requires, any reference herein to a “Section” or
“clause” refers to a Section or clause, as the case may be, of this Agreement,
and the words “herein,” “hereof” and “hereunder” and other words of similar
import refer to this Agreement as a whole and not to any particular Section or
other subdivision.

2. Registration Under the Securities Act.

(a) Except as set forth in Section 2(b) below, the Company agrees to file under
the Securities Act, no later than 90 days after the Closing Date, a registration
statement relating to an offer to exchange (such registration statement, the
“Exchange Registration Statement”, and such offer, the “Exchange Offer”) any and
all of the Securities for a like aggregate principal amount of debt securities
issued by the Company and guaranteed by the Guarantors, which debt securities
and guarantees are substantially identical to the Securities and the related
Guarantees, respectively (and are entitled to the benefits of a trust indenture
which is substantially identical to the Indenture or is the Indenture and which
has been qualified under the Trust Indenture Act), except that they have been
registered pursuant to an effective registration statement under the Securities
Act and do not contain provisions for Special Interest contemplated in
Section 2(c) below (such new debt securities hereinafter called “Exchange
Securities”). The Company agrees to use all commercially reasonable efforts to
cause the Exchange Registration Statement to become effective under the
Securities Act no later than 180 days after the Closing Date. The Exchange Offer
will be registered under the Securities Act on the appropriate form and will
comply with all applicable tender offer rules and regulations under the Exchange
Act. Unless the Exchange Offer would not be permitted by applicable law or
Commission policy, the Company further agrees to use all commercially reasonable
efforts to (i) commence the Exchange Offer promptly (but no later than 10
Business Days) following the Effective Time of such Exchange Registration
Statement, (ii) hold the Exchange Offer open for at least 20 Business Days in
accordance with Regulation 14E promulgated by the Commission under the Exchange
Act and (iii) exchange Exchange Securities for all Registrable Securities that
have been properly tendered and not withdrawn promptly following the expiration
of the Exchange Offer. The Exchange Offer will be deemed to have been
“completed” only (i) if the debt securities and related guarantees received by
holders other than Restricted Holders in the Exchange Offer for Registrable
Securities are, upon receipt, transferable by each such holder without
restriction under the Securities Act and the Exchange Act and without material
restrictions under the blue sky or securities laws of a substantial majority of
the States of the United States of America and (ii) upon the Company having
exchanged, pursuant to the Exchange Offer, Exchange Securities for all
Registrable Securities that have been properly tendered and not withdrawn before
the expiration of the Exchange Offer, which shall be on a date that is at least
20 and not more than 30 Business Days following the commencement of the Exchange
Offer. The Company agrees (x) to include in the Exchange Registration

 

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Statement a prospectus for use in any resales by any holder of Exchange
Securities that is a broker-dealer and (y) to keep such Exchange Registration
Statement effective for a period (the “Resale Period”) beginning when Exchange
Securities are first issued in the Exchange Offer and ending upon the earlier of
the expiration of the 90th day after the Exchange Offer has been completed or
such time as such broker-dealers no longer own any Registrable Securities. With
respect to such Exchange Registration Statement, such holders shall have the
benefit of the rights of indemnification and contribution set forth in
Subsections 6(a), (c), (d) and (e).

(b) If (i) on or prior to the time the Exchange Offer is completed existing law
or Commission interpretations are changed such that the debt securities or the
related guarantees received by holders other than Restricted Holders in the
Exchange Offer for Registrable Securities are not or would not be, upon receipt,
transferable by each such holder without restriction under the Securities Act,
(ii) the Effective Time of the Exchange Registration Statement is not within 180
days following the Closing Date and the Exchange Offer has not been completed
within 30 Business Days of such Effective Time or (iii) any holder of
Registrable Securities notifies the Company in writing prior to the 20th
Business Day following the completion of the Exchange Offer that: (A) it is
prohibited by law or Commission policy from participating in the Exchange Offer,
(B) it may not resell the Exchange Securities to the public without delivering a
prospectus and the prospectus supplement contained in the Exchange Registration
Statement is not appropriate or available for such resales or (C) it is a
broker-dealer and owns Securities acquired directly from the Company or an
affiliate of the Company, then the Company and the Guarantors shall, in lieu of
(or, in the case of clause (iii), in addition to) conducting the Exchange Offer
contemplated by Section 2(a), file under the Securities Act no later than 30
days after the time such obligation to file arises (but no earlier than 90 days
after the Closing Date), a “shelf” registration statement providing for the
registration of, and the sale on a continuous or delayed basis by the holders
of, all of the Registrable Securities, pursuant to Rule 415 or any similar rule
that may be adopted by the Commission (such filing, the “Shelf Registration” and
such registration statement, the “Shelf Registration Statement”). The Company
agrees to use all commercially reasonable efforts to cause the Shelf
Registration Statement to become or be declared effective no later than 90 days
after such Shelf Registration Statement filing obligation arises (but no earlier
than 180 days after the Closing Date); provided, that if at any time the Company
is or becomes a “well-known seasoned issuer” (as defined in Rule 405) and is
eligible to file an “automatic shelf registration statement” (as defined in
Rule 405), then the Company and the Guarantors shall file the Shelf Registration
Statement in the form of an automatic shelf registration statement as provided
in Rule 405. The Company agrees to use all commercially reasonable efforts to
keep such Shelf Registration Statement continuously effective for a period
ending on the earlier of the second anniversary of the Effective Time or such
time as there are no longer any Registrable Securities outstanding. No holder
shall be entitled to be named as a selling securityholder in the Shelf
Registration Statement or to use the prospectus forming a part thereof for
resales of Registrable Securities unless such holder is an Electing Holder. The
Company agrees, after the Effective Time of the Shelf Registration Statement and
promptly upon the request of any holder of Registrable Securities that is not
then an Electing Holder, to use all commercially reasonable efforts to enable
such holder to use the prospectus forming a part thereof for resales of
Registrable Securities, including, without limitation, any action necessary to
identify such holder as a selling securityholder in the Shelf Registration
Statement (whether by post-effective amendment thereto or by filing a prospectus
pursuant to Rules 430B and 424(b) under the Securities Act identifying such
holder), provided, however, that nothing in this sentence shall relieve any such
holder of the obligation to return a completed and signed Notice and
Questionnaire to the Company in accordance with Section 3(d)(iii).

 

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(c) In the event that (i) the Company and the Guarantors have not filed the
Exchange Registration Statement or the Shelf Registration Statement on or before
the date on which such registration statement is required to be filed pursuant
to Section 2(a) or Section 2(b), respectively, or (ii) such Exchange
Registration Statement or Shelf Registration Statement has not become effective
or been declared effective by the Commission on or before the date on which such
registration statement is required to become or be declared effective pursuant
to Section 2(a) or Section 2(b), respectively, or (iii) the Exchange Offer has
not been completed within 30 Business Days after the Effective Time of the
Exchange Registration Statement relating to the Exchange Offer (if the Exchange
Offer is then required to be made) or (iv) any Exchange Registration Statement
or Shelf Registration Statement required by Section 2(a) or Section 2(b) is
filed and declared effective but shall thereafter either be withdrawn by the
Company or shall become subject to an effective stop order issued pursuant to
Section 8(d) of the Securities Act suspending the effectiveness of such
registration statement (except as specifically permitted herein) without being
succeeded immediately by an additional registration statement filed and declared
effective (each such event referred to in clauses (i) through (iv), a
“Registration Default” and each period during which a Registration Default has
occurred and is continuing, a “Registration Default Period”), then, as
liquidated damages for such Registration Default, subject to the provisions of
Section 9(b), special interest (“Special Interest”), in addition to the Base
Interest, shall accrue at a per annum rate of 0.25% for the first 90 days of the
Registration Default Period, at a per annum rate of 0.50% for the second 90 days
of the Registration Default Period, at a per annum rate of 0.75% for the third
90 days of the Registration Default Period and at a per annum rate of 1.0%
thereafter for the remaining portion of the Registration Default Period.

(d) The Company shall take, and shall cause the Guarantors to take, all actions
necessary or advisable to be taken by them to ensure that the transactions
contemplated herein are effected as so contemplated, including all actions
necessary or desirable to register the Guarantee under any Exchange Registration
Statement or Shelf Registration Statement, as applicable.

(e) Any reference herein to a registration statement as of any time shall be
deemed to include any document incorporated, or deemed to be incorporated,
therein by reference as of such time and any reference herein to any
post-effective amendment to a registration statement as of any time shall be
deemed to include any document incorporated, or deemed to be incorporated,
therein by reference as of such time.

3. Registration Procedures.

If the Company and the Guarantors file a registration statement pursuant to
Section 2(a) or Section 2(b), the following provisions shall apply:

(a) At or before the Effective Time of the Exchange Registration or any Shelf
Registration, whichever may occur first, the Company shall qualify the Indenture
under the Trust Indenture Act.

(b) In the event that such qualification would require the appointment of a new
trustee under the Indenture, the Company shall appoint a new trustee thereunder
pursuant to the applicable provisions of the Indenture.

 

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(c) In connection with the Company’s and the Guarantors’ obligations with
respect to the registration of Exchange Securities as contemplated by
Section 2(a) (the “Exchange Registration”), if applicable, the Company and the
Guarantors shall:

(i) prepare and file with the Commission, no later than 90 days after the
Closing Date, an Exchange Registration Statement on any form which may be
utilized by the Company and the Guarantors and which shall permit the Exchange
Offer and resales of Exchange Securities by broker-dealers during the Resale
Period to be effected as contemplated by Section 2(a), and use all commercially
reasonable efforts to cause such Exchange Registration Statement to become
effective no later than 180 days after the Closing Date;

(ii) prepare and file with the Commission as soon as practicable such amendments
and supplements to such Exchange Registration Statement and the prospectus
included therein as may be necessary to effect and maintain the effectiveness of
such Exchange Registration Statement for the periods and purposes contemplated
in Section 2(a) and as may be required by the applicable rules and regulations
of the Commission and the instructions applicable to the form of such Exchange
Registration Statement, and promptly provide each broker-dealer holding Exchange
Securities with such number of copies of the prospectus included therein (as
then amended or supplemented), in conformity in all material respects with the
requirements of the Securities Act and the Trust Indenture Act, as such
broker-dealer reasonably may request prior to the expiration of the Resale
Period, for use in connection with resales of Exchange Securities;

(iii) promptly notify each broker-dealer that has requested in writing or
received copies of the prospectus included in such Exchange Registration
Statement, and confirm such advice in writing, (A) when such Exchange
Registration Statement or the prospectus included therein or any prospectus
amendment or supplement or post-effective amendment has been filed, and, with
respect to such Exchange Registration Statement or any post-effective amendment,
when the same has become effective, (B) of any comments by the Commission and by
the blue sky or securities commissioner or regulator of any state with respect
thereto or any request by the Commission for amendments or supplements to such
Exchange Registration Statement or prospectus or for additional information,
(C) of the issuance by the Commission of any stop order suspending the
effectiveness of such Exchange Registration Statement or the initiation or
threatening of any proceedings for that purpose, (D) if at any time the
representations and warranties of the Company contemplated by Section 5 cease to
be true and correct in all material respects, (E) of the receipt by the Company
of any notification with respect to the suspension of the qualification of the
Exchange Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, (F) the occurrence of any event
that causes the Company to become an “ineligible issuer” as defined in Rule 405,
or (G) if at any time during the Resale Period when a prospectus is required to
be delivered under the Securities Act, that such Exchange Registration
Statement, prospectus, prospectus amendment or supplement or post-effective
amendment does not conform in all material respects to the applicable
requirements of the Securities Act and the Trust Indenture Act or contains an
untrue statement of a material fact or omits to state any material fact required
to be stated therein or necessary to make the statements therein not misleading
in light of the circumstances then existing;

 

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(iv) in the event that the Company and the Guarantors would be required,
pursuant to Section 3(c)(iii)(G), to notify any broker-dealers holding Exchange
Securities, promptly prepare and furnish to each such holder a reasonable number
of copies of a prospectus supplemented or amended so that, as thereafter
delivered to purchasers of such Exchange Securities during the Resale Period,
such prospectus shall conform in all material respects to the applicable
requirements of the Securities Act and the Trust Indenture Act and shall not
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 not
misleading in light of the circumstances then existing;

(v) use all commercially reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of such Exchange Registration Statement or
any post-effective amendment thereto at the earliest practicable date;

(vi) use all commercially reasonable efforts to (A) register or qualify the
Exchange Securities under the securities laws or blue sky laws of such
jurisdictions as are contemplated by Section 2(a) no later than the commencement
of the Exchange Offer, to the extent required by such laws, (B) keep such
registrations or qualifications in effect and comply with such laws so as to
permit the continuance of offers, sales and dealings therein in such
jurisdictions until the expiration of the Resale Period, (C) take any and all
other actions as may be reasonably necessary or advisable to enable each
broker-dealer holding Exchange Securities to consummate the disposition thereof
in such jurisdictions and (D) obtain the consent or approval of each
governmental agency or authority, whether federal, state or local, which may be
required to effect the Exchange Registration, the Exchange Offer and the
offering and sale of Exchange Securities by broker-dealers during the Resale
Period; provided, however, that neither the Company nor the Guarantors shall be
required for any such purpose to (1) qualify as a foreign corporation in any
jurisdiction wherein it would not otherwise be required to qualify but for the
requirements of this Section 3(c)(vi), (2) consent to general service of process
in any such jurisdiction or become subject to taxation in any such jurisdiction
or (3) make any changes to its certificate of incorporation or by-laws or other
governing documents or any agreement between it and its stockholders;

(vii) provide a CUSIP number for all Exchange Securities, not later than the
applicable Effective Time; and

(viii) comply with all applicable rules and regulations of the Commission, and
any national securities exchange or any quotation service on which the Exchange
Securities may be listed or quoted, as applicable, and make generally available
to its securityholders no later than eighteen months after the Effective Time of
such Exchange Registration Statement, an “earning statement” of the Company and
its subsidiaries complying with Section 11(a) of the Securities Act (including,
at the option of the Company, Rule 158 thereunder).

(d) In connection with the Company’s and the Guarantors’ obligations with
respect to the Shelf Registration, if applicable, the Company and the Guarantors
shall:

(i) prepare and file with the Commission, within the time periods specified in
Section 2(b), a Shelf Registration Statement on any form which may be utilized
by the Company and which shall register all of the Registrable Securities for
resale by the holders thereof in accordance with such method or methods of
disposition as

 

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may be specified by the holders of Registrable Securities as, from time to time,
may be Electing Holders and use all commercially reasonable efforts to cause
such Shelf Registration Statement to become effective within the time periods
specified in Section 2(b);

(ii) mail the Notice and Questionnaire to the holders of Registrable Securities
(A) not less than 30 days prior to the anticipated Effective Time of the Shelf
Registration Statement or (B) in the case of an “automatic shelf registration
statement” (as defined in Rule 405), mail the Notice and Questionnaire to the
holders of Registrable Securities not later than the Effective Time of such
Shelf Registration Statement, and in any such case no holder shall be entitled
to be named as a selling securityholder in the Shelf Registration Statement, and
no holder shall be entitled to use the prospectus forming a part thereof for
resales of Registrable Securities at any time, unless and until such holder has
returned a completed and signed Notice and Questionnaire to the Company;

(iii) after the Effective Time of the Shelf Registration Statement, upon the
written request of any holder of Registrable Securities that is not then an
Electing Holder, promptly send a Notice and Questionnaire to such holder;
provided that the Company shall not be required to take any action to name such
holder as a selling securityholder in the Shelf Registration Statement or to
enable such holder to use the prospectus forming a part thereof for resales of
Registrable Securities until such holder has returned a completed and signed
Notice and Questionnaire to the Company;

(iv) as soon as practicable prepare and file with the Commission such amendments
and supplements to such Shelf Registration Statement and the prospectus included
therein as may be necessary to effect and maintain the effectiveness of such
Shelf Registration Statement for the period specified in Section 2(b) and as may
be required by the applicable rules and regulations of the Commission and the
instructions applicable to the form of such Shelf Registration Statement, and
furnish to the Electing Holders copies of any such supplement or amendment
simultaneously with or prior to its being used or filed with the Commission to
the extent such documents are not publicly available on the Commission’s EDGAR
System;

(v) comply with the provisions of the Securities Act with respect to the
disposition of all of the Registrable Securities covered by such Shelf
Registration Statement in accordance with the intended methods of disposition by
the Electing Holders provided for in such Shelf Registration Statement;

(vi) provide the Electing Holders and not more than one counsel for all the
Electing Holders the reasonable opportunity to participate in the preparation of
such Shelf Registration Statement, each prospectus included therein or filed
with the Commission and each amendment or supplement thereto;

(vii) for a reasonable period prior to the filing of such Shelf Registration
Statement, and throughout the period specified in Section 2(b), make available
at reasonable times at the Company’s principal place of business or such other
reasonable place for inspection by the persons referred to in Section 3(d)(vi)
who shall certify to the Company that they have a current intention to sell the
Registrable Securities pursuant to the Shelf Registration such financial and
other information and books and records of the Company, and cause the officers,
employees, counsel and

 

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independent certified public accountants of the Company to respond to such
inquiries, as shall be reasonably necessary (and in the case of counsel, not
violate an attorney-client privilege, in such counsel’s reasonable belief), in
the judgment of the respective counsel referred to in Section 3(d)(vi), to
conduct a reasonable investigation within the meaning of Section 11 of the
Securities Act; provided, however, that the foregoing inspection and information
gathering on behalf of the Electing Holders shall be conducted by one counsel
designated by the holders of at least a majority in aggregate principal amount
of the Registrable Securities held by the Electing Holders at the time
outstanding and provided further that each such party shall be required to
maintain in confidence and not to disclose to any other person any information
or records reasonably designated by the Company as being confidential, until
such time as (A) such information becomes a matter of public record (whether by
virtue of its inclusion in such Shelf Registration Statement or otherwise), or
(B) such person shall be required so to disclose such information pursuant to a
subpoena or order of any court or other governmental agency or body having
jurisdiction over the matter (subject to the requirements of such order, and
only after such person shall have given the Company prompt prior written notice
of such requirement), or (C) such information is required to be set forth in
such Shelf Registration Statement or the prospectus included therein or in an
amendment to such Shelf Registration Statement or an amendment or supplement to
such prospectus in order that such Shelf Registration Statement, prospectus,
amendment or supplement, as the case may be, complies with applicable
requirements of the federal securities laws and the rules and regulations of the
Commission and does not contain an untrue statement of a material fact or omit
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances then
existing;

(viii) promptly notify each of the Electing Holders and confirm such advice in
writing, (A) when such Shelf Registration Statement or the prospectus included
therein or any prospectus amendment or supplement or post-effective amendment
has been filed, and, with respect to such Shelf Registration Statement or any
post-effective amendment, when the same has become effective, (B) of any
comments by the Commission and by the blue sky or securities commissioner or
regulator of any state with respect thereto or any request by the Commission for
amendments or supplements to such Shelf Registration Statement or prospectus or
for additional information, (C) of the issuance by the Commission of any stop
order suspending the effectiveness of such Shelf Registration Statement or the
initiation or threatening of any proceedings for that purpose, (D) if at any
time the representations and warranties of the Company set forth in Section 5
cease to be true and correct in all material respects, (E) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, (F) the occurrence of any event
that causes the Company to become an “ineligible issuer” as defined in Rule 405,
or (G) if at any time when a prospectus is required to be delivered under the
Securities Act, that such Shelf Registration Statement, prospectus, prospectus
amendment or supplement or post-effective amendment does not conform in all
material respects to the applicable requirements of the Securities Act and the
Trust Indenture Act or contains an untrue statement of a material fact or omits
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the circumstances then
existing;

 

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(ix) use all commercially reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of such Shelf Registration Statement or any
post-effective amendment thereto at the earliest practicable date;

(x) if requested in writing by any Electing Holder, promptly incorporate in a
prospectus supplement or post-effective amendment such information as is
required by the applicable rules and regulations of the Commission and as such
Electing Holder specifies should be included therein relating to the terms of
the sale of such Registrable Securities, including information with respect to
the principal amount of Registrable Securities being sold by such Electing
Holder, the name and description of such Electing Holder, the offering price of
such Registrable Securities and any discount, commission or other compensation
payable in respect thereof and with respect to any other terms of the offering
of the Registrable Securities to be sold by such Electing Holder; and make all
required filings of such prospectus supplement or post-effective amendment
promptly after notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment;

(xi) furnish to each Electing Holder and the counsel referred to in
Section 3(d)(vi) an executed copy (or a conformed copy) of such Shelf
Registration Statement, each such amendment and supplement thereto (in each case
including all exhibits thereto (in the case of an Electing Holder of Registrable
Securities, upon request) and documents incorporated by reference therein) and
such number of copies of such Shelf Registration Statement (excluding exhibits
thereto and documents incorporated by reference therein unless specifically so
requested by such Electing Holder) and of the prospectus included in such Shelf
Registration Statement (including each preliminary prospectus and any summary
prospectus), in conformity in all material respects with the applicable
requirements of the Securities Act and the Trust Indenture Act to the extent
such documents are not available through the Commission’s EDGAR System, and such
other documents, as such Electing Holder may reasonably request in writing in
order to facilitate the offering and disposition of the Registrable Securities
owned by such Electing Holder and to permit such Electing Holder to satisfy the
prospectus delivery requirements of the Securities Act; and subject to
Section 3(e), the Company hereby consents to the use of such prospectus
(including such preliminary and summary prospectus) and any amendment or
supplement thereto by each such Electing Holder, in each case in the form most
recently provided to such person by the Company, in connection with the offering
and sale of the Registrable Securities covered by the prospectus (including such
preliminary and summary prospectus) or any supplement or amendment thereto;

(xii) use all commercially reasonable efforts to (A) register or qualify the
Registrable Securities to be included in such Shelf Registration Statement under
such securities laws or blue sky laws of such jurisdictions as any Electing
Holder shall reasonably request, (B) keep such registrations or qualifications
in effect and comply with such laws so as to permit the continuance of offers,
sales and dealings therein in such jurisdictions during the period the Shelf
Registration is required to remain effective under Section 2(b) and for so long
as may be necessary to enable any such Electing Holder to complete its
distribution of Securities pursuant to such Shelf Registration Statement,
(C) take any and all other actions as may be reasonably necessary or advisable
to enable each such Electing Holder to consummate the disposition in such
jurisdictions of such Registrable Securities and (D) obtain the consent or
approval of each governmental agency or authority,

 

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whether federal, state or local, which may be required to effect the Shelf
Registration or the offering or sale in connection therewith or to enable the
selling holder or holders to offer, or to consummate the disposition of, their
Registrable Securities; provided, however, that neither the Company nor the
Guarantors shall be required for any such purpose to (1) qualify as a foreign
corporation in any jurisdiction wherein it would not otherwise be required to
qualify but for the requirements of this Section 3(d)(xii), (2) consent to
general service of process in any such jurisdiction or become subject to
taxation in any such jurisdiction or (3) make any changes to its certificate of
incorporation or by-laws or other governing documents or any agreement between
it and its stockholders;

(xiii) unless any Registrable Securities shall be in book-entry only form,
cooperate with the Electing Holders to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold, which
certificates, if so required by any securities exchange upon which any
Registrable Securities are listed, shall be printed, penned, lithographed,
engraved or otherwise produced by any combination of such methods, on steel
engraved borders, and which certificates shall not bear any restrictive legends;

(xiv) provide a CUSIP number for all Registrable Securities, not later than the
applicable Effective Time;

(xv) notify in writing each holder of Registrable Securities of any proposal by
the Company to amend or waive any provision of this Agreement pursuant to
Section 9(h) and of any amendment or waiver effected pursuant thereto, each of
which notices shall contain the text of the amendment or waiver proposed or
effected, as the case may be; and

(xvi) comply with all applicable rules and regulations of the Commission, and
make generally available to its securityholders no later than eighteen months
after the Effective Time of such Shelf Registration Statement an earnings
statement of the Company and its subsidiaries complying with Section 11(a) of
the Securities Act (including, at the option of the Company, Rule 158
thereunder).

(e) In the event that the Company would be required, pursuant to
Section 3(d)(viii)(G), to notify the Electing Holders, the Company shall
promptly prepare and furnish to each of the Electing Holders a reasonable number
of copies of a prospectus supplemented or amended so that, as thereafter
delivered to purchasers of Registrable Securities, such prospectus shall conform
in all material respects to the applicable requirements of the Securities Act
and the Trust Indenture Act and shall not 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 not misleading in light of the
circumstances then existing. Each Electing Holder agrees that upon receipt of
any notice from the Company pursuant to Section 3(d)(viii)(G), such Electing
Holder shall forthwith discontinue the disposition of Registrable Securities
pursuant to the Shelf Registration Statement applicable to such Registrable
Securities until such Electing Holder shall have received copies of such amended
or supplemented prospectus, and if so directed by the Company, such Electing
Holder shall deliver to the Company (at the Company’s expense) all copies, other
than permanent file copies, then in such Electing Holder’s possession of the
prospectus covering such Registrable Securities at the time of receipt of such
notice.

(f) In the event of a Shelf Registration, in addition to the information
required to be provided by each Electing Holder in its Notice and Questionnaire,
the Company may require

 

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such Electing Holder to furnish to the Company such additional information
regarding such Electing Holder and such Electing Holder’s intended method of
distribution of Registrable Securities as may be required or necessary in order
to comply with the Securities Act. Each such Electing Holder agrees to notify
the Company as promptly as practicable of any inaccuracy or change in
information previously furnished by such Electing Holder to the Company or of
the occurrence of any event in either case as a result of which any prospectus
relating to such Shelf Registration contains or would contain an untrue
statement of a material fact regarding such Electing Holder or such Electing
Holder’s intended method of disposition of such Registrable Securities or omits
to state any material fact regarding such Electing Holder or such Electing
Holder’s intended method of disposition of such Registrable Securities required
to be stated therein or necessary to make the statements therein not misleading
in light of the circumstances then existing, and promptly to furnish to the
Company any additional information required to correct and update any previously
furnished information or required so that such prospectus shall not contain,
with respect to such Electing Holder or the disposition of such Registrable
Securities, 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
not misleading in light of the circumstances then existing.

(g) Until the expiration of one year after the Closing Date, the Company will
not, and will not permit any of its “affiliates” (as defined in Rule 144) to,
resell any of the Securities that have been reacquired by any of them except
pursuant to an effective registration statement, or a valid exemption from the
registration requirements, under the Securities Act.

(h) As a condition to its participation in the Exchange Offer, each holder of
Registrable Securities shall furnish, upon the request of the Company, a written
representation to the Company (which may be contained in the letter of
transmittal or “agent’s message” transmitted via The Depository Trust Company’s
Automated Tender Offer Procedures, in either case contemplated by the Exchange
Registration Statement) to the effect that (A) it is not an “affiliate” of the
Company, as defined in Rule 405 of the Securities Act, or if it is such an
“affiliate”, it will comply with the registration and prospectus delivery
requirements of the Securities Act to the extent applicable, (B) it is not
engaged in and does not intend to engage in, and has no arrangement or
understanding with any person to participate in, a distribution of the Exchange
Securities to be issued in the Exchange Offer, (C) it is acquiring the Exchange
Securities in its ordinary course of business, (D) if it is a broker-dealer that
holds Securities that were acquired for its own account as a result of
market-making activities or other trading activities (other than Securities
acquired directly from the Company or any of its affiliates), it will deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resales of the Exchange Securities received by it in the Exchange Offer, (E) if
it is a broker-dealer, that it did not purchase the Securities to be exchanged
in the Exchange Offer from the Company or any of its affiliates, and (F) it is
not acting on behalf of any person who could not truthfully and completely make
the representations contained in the foregoing subclauses (A) through (E).

4. Registration Expenses.

The Company agrees to bear and to pay or cause to be paid promptly all expenses
incident to the Company’s performance of or compliance with this Agreement,
including (a) all Commission and any FINRA registration, filing and review fees
and expenses including reasonable fees and disbursements of counsel for the
Eligible Holders in connection with such registration, filing and review,
(b) all fees and expenses in connection with the qualification of the
Registrable Securities and the Exchange Securities, as applicable, for offering
and sale under the State securities and blue sky laws referred to in
Section 3(d)(xii) and determination of

 

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their eligibility for investment under the laws of such jurisdictions as the
Electing Holders may designate, including any reasonable fees and disbursements
of one counsel (plus no more than one local or foreign counsel in any
jurisdiction) for the Electing Holders in connection with such qualification and
determination, (c) all expenses relating to the preparation, printing,
production, distribution and reproduction of each registration statement
required to be filed hereunder, each prospectus included therein or prepared for
distribution pursuant hereto, each amendment or supplement to the foregoing, the
expenses of preparing the Securities or Exchange Securities, as applicable, for
delivery and the expenses of printing or producing any selling agreements and
blue sky or legal investment memoranda and all other documents in connection
with the offering, sale or delivery of Securities or Exchange Securities, as
applicable, to be disposed of (including certificates representing the
Securities or Exchange Securities, as applicable), (d) messenger, telephone and
delivery expenses relating to the offering, sale or delivery of Securities or
Exchange Securities, as applicable, and the preparation of documents referred in
clause (c) above, (e) fees and expenses of the Trustee under the Indenture, any
agent of the Trustee and any counsel for the Trustee and of any collateral agent
or custodian, (f) internal expenses (including all salaries and expenses of the
Company’s officers and employees performing legal or accounting duties),
(g) reasonable fees, disbursements and expenses of counsel and independent
certified public accountants of the Company, (h) reasonable fees, disbursements
and expenses of one counsel for the Electing Holders retained in connection with
a Shelf Registration, as selected by the Electing Holders of at least a majority
in aggregate principal amount of the Registrable Securities held by Electing
Holders (which counsel shall be reasonably satisfactory to the Company), (i) any
fees charged by securities rating services for rating the Registrable Securities
or the Exchange Securities, as applicable, and (j) fees, expenses and
disbursements of any other persons, including special experts, retained by the
Company in connection with such registration (collectively, the “Registration
Expenses”). To the extent that any Registration Expenses are incurred, assumed
or paid by any holder of Registrable Securities, Securities or Exchange
Securities, as applicable, the Company shall reimburse such person for the full
amount of the Registration Expenses so incurred, assumed or paid promptly after
receipt of a request therefor. Notwithstanding the foregoing, the holders of the
Registrable Securities being registered shall pay all agency fees and
commissions and underwriting discounts and commissions, if any, and transfer
taxes, if any, attributable to the sale of such Registrable Securities and
Exchange Securities, as applicable, and the fees and disbursements of any
counsel or other advisors or experts retained by such holders (severally or
jointly), other than the counsel and experts specifically referred to above.

5. Representations and Warranties.

Each of the Company and the Guarantors, jointly and severally, represents and
warrants to, and agrees with, the Dealer Managers and each of the holders from
time to time of Registrable Securities that:

(a) Each registration statement covering Registrable Securities, Securities or
Exchange Securities, as applicable, and each prospectus (including any
preliminary or summary prospectus) contained therein or furnished pursuant to
Section 3(c) or Section 3(d) and any further amendments or supplements to any
such registration statement or prospectus, when it becomes effective or is filed
with the Commission, as the case may be, will conform in all material respects
to the requirements of the Securities Act and the Trust Indenture Act and will
not 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
not misleading; and at all times subsequent to the Effective Time when a
prospectus would be required to be delivered under the Securities Act, other
than from (i) such time as a notice has been given to holders of Registrable
Securities pursuant to Section 3(c)(iii)(G) or Section 3(d)(viii)(G) until
(ii) such

 

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time as the Company furnishes an amended or supplemented prospectus pursuant to
Section 3(c)(iv) or Section 3(e), each such registration statement, and each
prospectus (including any summary prospectus) contained therein or furnished
pursuant to Section 3(c) or Section 3(d), as then amended or supplemented, will
conform in all material respects to the requirements of the Securities Act and
the Trust Indenture Act and will not 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 not misleading in the light of the circumstances
then existing; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by a holder of Registrable
Securities expressly for use therein.

(b) Any documents incorporated by reference in any prospectus referred to in
Section 5(a), when they become or became effective or are or were filed with the
Commission, as the case may be, will conform or conformed in all material
respects to the requirements of the Securities Act or the Exchange Act, as
applicable, and none of such documents will contain or contained an untrue
statement of a material fact or will omit or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by a holder of Registrable
Securities expressly for use therein.

(c) The compliance by the Company with all of the provisions of this Agreement
and the consummation of the transactions herein contemplated will not
(i) conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any material indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, (ii) result in any violation of
the provisions of the certificate of incorporation, as amended, or the by-laws
or other governing documents, as applicable, of the Company or the Guarantors or
(iii) result in any violation of any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their respective properties; and no consent,
approval, authorization, order, registration or qualification of or with any
such court or governmental agency or body is required for the consummation by
the Company and the Guarantors of the transactions contemplated by this
Agreement, except (x) the registration under the Securities Act of the
Registrable Securities and the Exchange Securities, as applicable, and
qualification of the Indenture under the Trust Indenture Act, (y) such consents,
approvals, authorizations, registrations or qualifications as may be required
under state securities or blue sky laws in connection with the offering and
distribution of the Registrable Securities and the Exchange Securities, as
applicable, and (z) such consents, approvals, authorizations, registrations or
qualifications that have been obtained and are in full force and effect as of
the date hereof.

(d) This Agreement has been duly authorized, executed and delivered by the
Company and by the Guarantors.

6. Indemnification and Contribution.

(a) Indemnification by the Company and the Guarantors. The Company and the
Guarantors, jointly and severally, will indemnify and hold harmless each of the
holders of Registrable Securities included in an Exchange Registration Statement
and each of the

 

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Electing Holders as holders of Registrable Securities included in a Shelf
Registration Statement against any losses, claims, damages or liabilities, joint
or several, to which such holder or such Electing Holder may become subject
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Exchange Registration Statement or any Shelf Registration Statement, as the case
may be, under which such Registrable Securities or Exchange Securities were
registered under the Securities Act, or any preliminary, final or summary
prospectus (including, without limitation, any “issuer free writing prospectus”
as defined in Rule 433) contained therein or furnished by the Company to any
such holder or any such Electing Holder, or any amendment 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 not misleading, and will reimburse each such holder and each
such Electing Holder for any and all legal or other expenses reasonably incurred
by them in connection with investigating or defending any such action or claim
as such expenses are incurred; provided, however, that neither the Company nor
the Guarantors shall be liable to any such person in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in such registration statement, or preliminary, final or summary prospectus
(including, without limitation, any “issuer free writing prospectus” as defined
in Rule 433), or amendment or supplement thereto, in reliance upon and in
conformity with written information furnished to the Company by such person
expressly for use therein.

(b) Indemnification by the Electing Holders. The Company may require, as a
condition to including any Registrable Securities in any Shelf Registration
Statement filed pursuant to Section 2(b), that the Company shall have received
an undertaking reasonably satisfactory to it from each Electing Holder of
Registrable Securities included in such Shelf Registration Statement, severally
and not jointly, to (i) indemnify and hold harmless the Company, the Guarantors
and all other Electing Holders of Registrable Securities included in such Shelf
Registration Statement, against any losses, claims, damages or liabilities to
which the Company, the Guarantors or such other Electing Holders may become
subject, under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in such registration statement, or any preliminary, final or summary
prospectus (including, without limitation, any “issuer free writing prospectus”
as defined in Rule 433) contained therein or furnished by the Company to any
Electing Holder, or any amendment 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 not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Company by such Electing Holder expressly for use therein, and (ii) reimburse
the Company and the Guarantors for any legal or other expenses reasonably
incurred by the Company and the Guarantors in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however, that no such Electing Holder shall be required to undertake liability
to any person under this Section 6(b) for any amounts in excess of the dollar
amount of the proceeds to be received by such Electing Holder from the sale of
such Electing Holder’s Registrable Securities pursuant to such registration.

(c) Notices of Claims, Etc. Promptly after receipt by an indemnified party under
subsection (a) or (b) above of written notice of the commencement of any action,
such

 

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indemnified party shall, if a claim in respect thereof is to be made against an
indemnifying party pursuant to the indemnification provisions of or contemplated
by this Section 6, notify such indemnifying party in writing of the commencement
of such action; but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified party
otherwise than under the indemnification provisions of or contemplated by
Section 6(a) or Section 6(b). In case any such action shall be brought against
any indemnified party and it shall notify an indemnifying party of the
commencement thereof, such indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, such indemnifying party shall
not be liable to such indemnified party for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the prior written consent of
the indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act by or on behalf of any
indemnified party.

(d) Contribution. If for any reason the indemnification provisions contemplated
by Section 6(a) or Section 6(b) are unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and the indemnified party in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative fault of such indemnifying party and
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by
such indemnifying party or by such indemnified party, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The parties hereto agree that it would not be just
and equitable if contributions pursuant to this Section 6(d) were determined by
pro rata allocation (even if the holders were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in this Section 6(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages, or
liabilities (or actions in respect thereof) referred to above shall be deemed to
include any legal or other fees or expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 6(d), no Electing
Holder shall be required to contribute any amount in excess of the amount by
which the dollar amount of the proceeds received by such holder from the sale of
any Registrable Securities (after deducting any fees, discounts and commissions
applicable thereto) exceeds the amount of any damages which such holder has
otherwise been required to pay by reason of such untrue or alleged

 

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untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The holders’ obligations in this Section 6(d) to
contribute shall be several in proportion to the principal amount of Registrable
Securities registered by them and not joint.

(e) The obligations of the Company and the Guarantors under this Section 6 shall
be in addition to any liability which the Company or the Guarantors may
otherwise have and shall extend, upon the same terms and conditions, to each
officer, director and partner of each holder, each Electing Holder, and each
person, if any, who controls any of the foregoing within the meaning of the
Securities Act; and the obligations of the holders and the Electing Holders
contemplated by this Section 6 shall be in addition to any liability which the
respective holder or Electing Holder may otherwise have and shall extend, upon
the same terms and conditions, to each officer and director of the Company or
the Guarantors including any person who, with his consent, is named in any
registration statement as about to become a director of the Company or of a
Guarantor) and to each person, if any, who controls the Company within the
meaning of the Securities Act, as well as to each officer and director of the
other holders and to each person, if any, who controls such other holders within
the meaning of the Securities Act.

7. Underwritten Offerings.

Each holder of Registrable Securities hereby agrees with the Company and each
other such holder that no holder of Registrable Securities may participate in
any underwritten offering hereunder unless (a) the Company gives its prior
written consent to such underwritten offering, (b) the managing underwriter or
underwriters thereof shall be designated by Electing Holders holding at least a
majority in aggregate principal amount of the Registrable Securities to be
included in such offering, provided that such designated managing underwriter or
underwriters is or are reasonably acceptable to the Company, (c) each holder of
Registrable Securities participating in such underwritten offering agrees to
sell such holder’s Registrable Securities on the basis provided in any
underwriting arrangements approved by the persons entitled selecting the
managing underwriter or underwriters hereunder and (d) each holder of
Registrable Securities participating in such underwritten offering completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements. The Company hereby agrees with each holder of
Registrable Securities that, to the extent it consents to an underwritten
offering hereunder, it will negotiate in good faith and execute all indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements, including using all commercially reasonable
efforts to procure customary legal opinions and auditor “comfort” letters.

8. Rule 144.

(a) Facilitation of Sales Pursuant to Rule 144. The Company covenants to the
holders of Registrable Securities that to the extent it shall be required to do
so under the Exchange Act, the Company shall timely file the reports required to
be filed by it under the Exchange Act or the Securities Act (including the
reports under Sections 13 and 15(d) of the Exchange Act referred to in
subparagraph (c)(1) of Rule 144), and shall take such further action as any
holder of Registrable Securities may reasonably request, all to the extent
required from time to time to enable such holder to sell Registrable Securities
without registration under the Securities Act within the limitations of the
exemption provided by Rule 144. Upon the request of any holder of Registrable
Securities in connection with that holder’s sale pursuant to Rule 144, the
Company shall deliver to such holder a written statement as to whether it has
complied with such requirements.

 

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(b) Availability of Rule 144 Not Excuse for Obligations under Section 2. The
fact that holders of Registrable Securities may become eligible to sell such
Registrable Securities pursuant to Rule 144 shall not (1) cause such Securities
to cease to be Registrable Securities or (2) excuse the Company’s and the
Guarantors’ obligations set forth in Section 2 of this Agreement, including
without limitation the obligations in respect of an Exchange Offer, Shelf
Registration, and Special Interest.

9. Miscellaneous.

(a) No Inconsistent Agreements. The Company represents, warrants, covenants and
agrees that it has not granted, and shall not grant, registration rights with
respect to Registrable Securities, Exchange Securities or Securities, as
applicable, or any other securities which would be inconsistent with the terms
contained in this Agreement.

(b) Specific Performance. The parties hereto acknowledge that there would be no
adequate remedy at law if the Company fails to perform any of its obligations
hereunder and that the Dealer Managers and the holders from time to time of the
Registrable Securities may be irreparably harmed by any such failure, and
accordingly agree that the Dealer Managers and such holders, in addition to any
other remedy to which they may be entitled at law or in equity, shall be
entitled to compel specific performance of the obligations of the Company under
this Agreement in accordance with the terms and conditions of this Agreement, in
any court of the United States or any State thereof having jurisdiction. Time
shall be of the essence in this Agreement.

(c) Notices. All notices, requests, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered by hand, if delivered personally, by facsimile or by
courier, or three days after being deposited in the mail (registered or
certified mail, postage prepaid, return receipt requested) as follows: If to the
Company, to it at 1155 Metcalfe Street, Suite 800, Montreal, Quebec, Canada H3B
5H2, and if to a holder, to the address of such holder set forth in the security
register or other records of the Company, or to such other address as the
Company or any such holder may have furnished to the other in writing in
accordance herewith, except that notices of change of address shall be effective
only upon receipt.

(d) Parties in Interest. All the terms and provisions of this Agreement shall be
binding upon, shall inure to the benefit of and shall be enforceable by the
parties hereto, the holders from time to time of the Registrable Securities and
the respective successors and assigns of the foregoing. In the event that any
transferee of any holder of Registrable Securities shall acquire Registrable
Securities, in any manner, whether by gift, bequest, purchase, operation of law
or otherwise, such transferee shall, without any further writing or action of
any kind, be deemed a beneficiary hereof for all purposes and such Registrable
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Registrable Securities such transferee shall be entitled
to receive the benefits of, and be conclusively deemed to have agreed to be
bound by all of the applicable terms and provisions of this Agreement. If the
Company shall so request, any such successor, assign or transferee shall agree
in writing to acquire and hold the Registrable Securities subject to all of the
applicable terms hereof.

(e) Survival. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Agreement or made pursuant
hereto shall remain in full

 

19

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force and effect regardless of any investigation (or statement as to the results
thereof) made by or on behalf of any holder of Registrable Securities, any
director, officer or partner of such holder, or any controlling person of any of
the foregoing, and shall survive delivery of and payment for the Registrable
Securities pursuant to the Dealer Managers Agreement, the transfer and
registration of Registrable Securities by such holder and the consummation of an
Exchange Offer.

(f) Governing Law. This Agreement and the rights and obligations of the parties
hereunder shall be governed by and shall be construed and enforced in accordance
with the laws of the State of New York, without regard to its conflicts of law
principles insofar as such principles would defer to the substantive laws of
some other jurisdiction.

(g) Headings. The descriptive headings of the several Sections and paragraphs of
this Agreement are inserted for convenience only, do not constitute a part of
this Agreement and shall not affect in any way the meaning or interpretation of
this Agreement.

(h) Entire Agreement; Amendments. This Agreement and the other writings referred
to herein (including the Indenture and the form of Securities) or delivered
pursuant hereto which form a part hereof contain the entire understanding of the
parties with respect to its subject matter. This Agreement supersedes all prior
agreements and understandings between the parties with respect to its subject
matter. This Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either
retroactively or prospectively) only by a written instrument duly executed by
the Company and the holders of at least a majority in aggregate principal amount
of the Registrable Securities at the time outstanding. Each holder of any
Registrable Securities at the time or thereafter outstanding shall be bound by
any amendment or waiver effected pursuant to this Section 9(h), whether or not
any notice, writing or marking indicating such amendment or waiver appears on
such Registrable Securities or is delivered to such holder.

(i) Inspection. For so long as this Agreement shall be in effect, this Agreement
and a complete list of the names and addresses of all the record holders of
Registrable Securities shall be made available for inspection and copying on any
Business Day by any holder of Registrable Securities for proper purposes only
(which shall include any purpose related to the rights of the holders of
Registrable Securities under the Securities, the Indenture and this Agreement)
at the offices of the Company at the address thereof set forth in Section 9(c)
and at the office of the Trustee under the Indenture.

(j) Counterparts. This Agreement may be executed by the parties in counterparts,
each of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.

(k) Severability. If any provision of this Agreement, or the application thereof
in any circumstance, is held to be invalid, illegal or unenforceable in any
respect for any reason, the validity, legality and enforceability of such
provision in every other respect and of the remaining provisions contained in
this Agreement shall not be affected or impaired thereby.

(l) Agent for Service; Submission to Jurisdiction. The Company acknowledges that
it has, by separate written agreement, irrevocably designated and appointed CT
Corporation (together with its successors and assigns, the “Agent”) as its
authorized agent for service of process in any suit, action or proceeding
arising out of or relating to this Agreement or brought with respect to the
Securities under U.S. federal or state securities laws, in each

 

20

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case instituted in any federal or state court located in the State and City of
New York. The Company hereby submits to the nonexclusive jurisdiction of any
such court in any such suit, action or proceeding and agrees that service of
process upon Agent with written notice thereof to the Company shall be deemed to
be effective service of process upon the Company in such suit, action or
proceeding.

 

21

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If the foregoing is in accordance with your understanding, please sign and
return to us four counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the holders, this letter and such acceptance hereof shall
constitute a binding agreement between each of the holders, the Guarantors and
the Company.

 

Very truly yours, Abitibi-Consolidated Company of Canada Abitibi-Consolidated
Inc. Donohue Corp. Les Explorations Terra Nova Ltee The Jonquiere Pulp Company
The International Bridge and Terminal Company Scramble Mining Ltd.
Abitibi-Consolidated Canadian Office Products Holdings Inc. Abitibi Consolidated
Sales Corporation Abitibi-Consolidated Alabama Corporation Alabama River
Newsprint Company Abitibi-Consolidated Corp. Augusta Woodlands, LLC 3224112 Nova
Scotia Limited Donohue Recycling Inc. Marketing Donohue Inc. 1508756 Ontario
Inc. 6169678 Canada Incorporated 3834328 Canada Inc. Abitibi-Consolidated Nova
Scotia Incorporated By:  

/s/ Allen Dea

Name:   Allen Dea Title:   Officer or authorized representative of each of the
above By:  

/s/ Jacques P. Vachon

Name:   Jacques P. Vachon Title:   Officer or authorized representative of each
of the above

 

1

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Bridgewater Paper Company Limited

By:

 

/s/ Jacques P. Vachon

Name:

 

Jacques P. Vachon

Title:

 

Senior Vice President

By:

 

/s/ Robert Clarke

Name:

 

Robert Clarke

Title:

 

Director

Cheshire Recycling Ltd.

By:

 

/s/ Barry Benson

Name:

 

Barry Benson

Title:

 

Controller

By:

 

/s/ Robert Clarke

Name:

 

Robert Clarke

Title:

 

Director

Saguenay Forest Products Inc.

By:

 

/s/ Allen Dea

Name:

 

Allen Dea

Title:

 

Assistant Secretary

 

2

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Accepted as of the date hereof: Goldman, Sachs & Co. By:  

/s/ Goldman Sachs & Co.

  (on behalf of the holders)

 

1

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SCHEDULE 1

Guarantors

(a) U.S. Guarantors

 

1. Donohue Corp., a Delaware corporation

2. Abitibi Consolidated Sales Corporation, a Delaware corporation

3. Abitibi-Consolidated Corp., a Delaware corporation

4. Augusta Woodlands, LLC, a Delaware limited liability company

5. Abitibi-Consolidated Alabama Corporation, an Alabama corporation

6. Alabama River Newsprint Company, an Alabama general partnership

(b) Canadian Guarantors

 

7. Abitibi-Consolidated Inc., a corporation amalgamated under the laws of Canada

8. Abitibi-Consolidated Canadian Office Products Holdings Inc., a corporation
amalgamated under the laws of Canada

9. 1508756 Ontario Inc., a company amalgamated under the laws of the Province of
Ontario

10. Donohue Recycling Inc., a company amalgamated under the laws of the Province
of Ontario

11. Marketing Donohue Inc., a company amalgamated under the laws of the Province
of Quèbec

12. 6169678 Canada Incorporated, a corporation amalgamated under the laws of
Canada

13. 3834328 Canada Inc., a corporation amalgamated under the laws of Canada

14. Abitibi-Consolidated Nova Scotia Incorporated, a company amalgamated under
the laws of the Province of Nova Scotia

15. Les Explorations Terra Nova Ltee., a company amalgamated under the laws of
the Province of Quèbec

16. La Compagnie de Pulpe de Jonquiere, a company amalgamated under the laws of
the Province of Quèbec

17. The International Bridge and Terminal Company, a corporation amalgamated
under the laws of Canada

18. Scramble Mining Ltd., a company amalgamated under the laws of the Province
of Ontario

19. 3224112 Nova Scotia Limited, a company amalgamated under the laws of the
Province of Nova Scotia

20. Produits Forestiers Saguenay Inc., a company amalgamated under the laws of
the Province of Quèbec

(c) U.K. Guarantors

 

21. Bridgewater Paper Company Limited (U.K.)

22. Cheshire Recycling Ltd (U.K.)

 

1

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Exhibit A

Abitibi-Consolidated Company of Canada

INSTRUCTION TO DTC PARTICIPANTS

(Date of Mailing)

URGENT - IMMEDIATE ATTENTION REQUESTED

DEADLINE FOR RESPONSE: [DATE] *

The Depository Trust Company (“DTC”) has identified you as a DTC Participant
through which beneficial interests in the Abitibi-Consolidated Company of Canada
(the “Company”) 15.5% Senior Notes due 2010 (the “Securities”) are held.

The Company is in the process of registering the Securities under the Securities
Act of 1933 for resale by the beneficial owners thereof. In order to have their
Securities included in the registration statement, beneficial owners must
complete and return the enclosed Notice of Registration Statement and Selling
Securityholder Questionnaire.

It is important that beneficial owners of the Securities receive a copy of the
enclosed materials as soon as possible as their rights to have the Securities
included in the registration statement depend upon their returning the Notice
and Questionnaire by [Deadline For Response]. Please forward a copy of the
enclosed documents to each beneficial owner that holds interests in the
Securities through you. If you require more copies of the enclosed materials or
have any questions pertaining to this matter, please contact
Abitibi-Consolidated Company of Canada, 1155 Metcalfe Street, Suite 800,
Montreal, Quebec, Canada H3B 5H2, (514) 875-2160.

 

* Not less than 28 calendar days from date of mailing.

 

A-1

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Abitibi-Consolidated Company of Canada

Notice of Registration Statement

and

Selling Securityholder Questionnaire

(Date)

Reference is hereby made to the Exchange and Registration Rights Agreement (the
“Exchange and Registration Rights Agreement”) among Abitibi-Consolidated Company
of Canada (the “Company”), the Guarantors party thereto and Goldman, Sachs & Co.
Pursuant to the Exchange and Registration Rights Agreement, the Company has
filed or will file with the United States Securities and Exchange Commission
(the “Commission”) a registration statement on Form [    ] (the “Shelf
Registration Statement”) for the registration and resale under Rule 415 of the
Securities Act of 1933, as amended (the “Securities Act”), of the Company’s
15.5% Senior Notes (the “Securities”). A copy of the Exchange and Registration
Rights Agreement has been filed as an exhibit to the Shelf Registration
Statement and can be obtained from the Commission’s website at www.sec.gov. All
capitalized terms not otherwise defined herein shall have the meanings ascribed
thereto in the Exchange and Registration Rights Agreement.

Each beneficial owner of Registrable Securities (as defined below) is entitled
to have the Registrable Securities beneficially owned by it included in the
Shelf Registration Statement. In order to have Registrable Securities included
in the Shelf Registration Statement, this Notice of Registration Statement and
Selling Securityholder Questionnaire (“Notice and Questionnaire”) must be
completed, executed and delivered to the Company’s counsel at the address set
forth herein for receipt ON OR BEFORE [Deadline for Response]. Beneficial owners
of Registrable Securities who do not properly complete, execute and return this
Notice and Questionnaire by such date (i) will not be named as selling
securityholders in the Shelf Registration Statement and (ii) may not use the
Prospectus forming a part thereof for resales of Registrable Securities.

Certain legal consequences arise from being named as a selling securityholder in
the Shelf Registration Statement and related Prospectus. Accordingly, holders
and beneficial owners of Registrable Securities are advised to consult their own
securities law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Shelf Registration Statement and
related Prospectus.

The term “Registrable Securities” is defined in the Exchange and Registration
Rights Agreement.

 

A-2

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ELECTION

The undersigned holder (the “Selling Securityholder”) of Registrable Securities
hereby elects to include in the Shelf Registration Statement the Registrable
Securities beneficially owned by it and listed below in Item (3). The
undersigned, by signing and returning this Notice and Questionnaire, agrees to
be bound with respect to such Registrable Securities by the terms and conditions
of this Notice and Questionnaire and the Exchange and Registration Rights
Agreement, including, without limitation, Section 6 of the Exchange and
Registration Rights Agreement, as if the undersigned Selling Securityholder were
an original party thereto.

Pursuant to the Exchange and Registration Rights Agreement, the undersigned has
agreed to indemnify and hold harmless the Company, its officers who sign any
Shelf Registration Statement, and each person, if any, who controls the Company
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act of 1934, as amended (the “Exchange Act”), against certain loses
arising out of an untrue statement, or the alleged untrue statement, of a
material fact in the Shelf Registration Statement or the related prospectus or
the omission, or alleged omission, to state a material fact required to be
stated in such Shelf Registration Statement or the related prospectus, but only
to the extent such untrue statement or omission, or alleged untrue statement or
omission, was made in reliance on and in conformity with the information
provided in this Notice and Questionnaire.

Upon any sale of Registrable Securities pursuant to the Shelf Registration
Statement, the Selling Securityholder will be required to deliver to the Company
and Trustee the Notice of Transfer set forth in Appendix A to the Prospectus and
as Exhibit B to the Exchange and Registration Rights Agreement.

The Selling Securityholder hereby provides the following information to the
Company and represents and warrants that such information is accurate and
complete:

 

A-3

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QUESTIONNAIRE

 

(1)    (a)    Full legal name of Selling Securityholder:      

 

   (b)    Full legal name of registered Holder (if not the same as in (a) above)
of Registrable Securities listed in Item (3) below:      

 

   (c)    Full legal name of DTC Participant (if applicable and if not the same
as (b) above) through which Registrable Securities listed in Item (3) below are
held:      

 

(2)    Address for notices to Selling Securityholder:      

 

        

 

        

 

         Telephone:   

 

         Fax:   

 

         Contact Person:   

 

         E-mail for Contact Person:   

 

   (3)    Beneficial Ownership of Securities:          Except as set forth below
in this Item (3), the undersigned does not beneficially own any Securities.   
(a)    Principal amount of Registrable Securities beneficially owned:
                                        
                                                                CUSIP No(s). of
such Registrable Securities:                                         
                                        
                                                 (b)    Principal amount of
Securities other than Registrable Securities beneficially owned:      

 

      CUSIP No(s). of such other Securities:
                                        
                                        
                                                           (c)    Principal
amount of Registrable Securities that the undersigned wishes to be included in
the Shelf Registration Statement:      

 

      CUSIP No(s). of such Registrable Securities to be included in the Shelf
Registration Statement:                                               (4)   
Beneficial Ownership of Other Securities of the Company:          Except as set
forth below in this Item (4), the undersigned Selling Securityholder is not the
beneficial or registered owner of any other securities of the Company, other
than the Securities listed above in Item (3).       State any exceptions here:
     

 

     

 

     

 

 

A-4

--------------------------------------------------------------------------------

(5)    Individuals who exercise dispositive powers with respect to the
Securities:      If the Selling Securityholder is not an entity that is required
to file reports with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act (a “Reporting Company”), then the Selling Securityholder must
disclose the name of the natural person(s) who exercise sole or shared
dispositive powers with respect to the Securities. Selling Securityholders
should disclose the beneficial holders, not nominee holders or other such others
of record. In addition, the Commission has provided guidance that Rule 13d-3 of
the Securities Exchange Act of 1934 should be used by analogy when determining
the person or persons sharing voting and/or dispositive powers with respect to
the Securities.    (a)   Is the holder a Reporting Company?      Yes
                    No                   If “No”, please answer Item (5)(b).   
(b)   List below the individual or individuals who exercise dispositive powers
with respect to the Securities:     

 

    

 

    

 

     Please note that the names of the persons listed in (b) above will be
included in the Shelf Registration Statement and related Prospectus. (6)   
Relationships with the Company:      Except as set forth below, neither the
Selling Securityholder nor any of its affiliates, officers, directors or
principal equity holders (5% or more) has held any position or office or has had
any other material relationship with the Company (or its predecessors or
affiliates) during the past three years.      State any exceptions here:     

 

    

 

    

 

(7)    Plan of Distribution:      Except as set forth below, the undersigned
Selling Securityholder intends to distribute the Registrable Securities listed
above in Item (3) only as follows (if at all): Such Registrable Securities may
be sold from time to time directly by the undersigned Selling Securityholder.
Such Registrable Securities may be sold in one or more transactions at fixed
prices, at prevailing market prices at the time of sale, at varying prices
determined at the time of sale, or at negotiated prices. Such sales may be
effected in transactions (which may involve crosses or block transactions)
(i) on any national securities exchange or quotation service on which the
Registered Securities may be listed or quoted at the time of sale, (ii) in the
over-the-counter market, (iii) in transactions otherwise than on such exchanges
or services or in the over-the-counter market, or (iv) through the writing of
options. In connection with sales of the

 

A-5

--------------------------------------------------------------------------------

      Registrable Securities or otherwise, the Selling Securityholder may enter
into hedging transactions with broker-dealers, which may in turn engage in short
sales of the Registrable Securities in the course of hedging the positions they
assume. The Selling Securityholder may also sell Registrable Securities short
and deliver Registrable Securities to close out such short positions, or loan or
pledge Registrable Securities to broker-dealers that in turn may sell such
securities.       State any exceptions here:      

 

     

 

     

 

      Note: In no event may such method(s) of distribution take the form of an
underwritten offering of Registrable Securities without the prior written
agreement of the Company. (8)    Broker-Dealers:       The Commission requires
that all Selling Securityholders that are registered broker-dealers or
affiliates of registered broker-dealers be so identified in the Shelf
Registration Statement. In addition, the Commission requires that all Selling
Securityholders that are registered broker-dealers be named as underwriters in
the Shelf Registration Statement and related Prospectus, even if they did not
receive the Registrable Securities as compensation for underwriting activities.
   (a)    State whether the undersigned Selling Securityholder is a registered
broker-dealer:       Yes                     No                 (b)    If the
answer to (a) is “Yes”, you must answer (i) and (ii) below, and (iii) below if
applicable. Your answers to (i) and (ii) below, and (iii) below if applicable,
will be included in the Shelf Registration Statement and related Prospectus.   
  

(i)     Were the Securities acquired as compensation for underwriting
activities?

      Yes                     No                    If you answered “Yes”,
please provide a brief description of the transaction(s) in which the Securities
were acquired as compensation:      

 

     

 

     

 

     

(ii)    Were the Securities acquired for investment purposes?

      Yes                     No                   

(iii)  If you answered “No” to both (i) and (ii), please explain the Selling
Securityholder’s reason for acquiring the Securities:

     

 

     

 

     

 

 

A-6

--------------------------------------------------------------------------------

   (c)    State whether the undersigned Selling Securityholder is an affiliate
of a registered broker-dealer and, if so, list the name(s) of the broker-dealer
affiliate(s):       Yes                     No                   

 

     

 

     

 

   (d)    If you answered “Yes” to question (c) above:      

(i)     Did the undersigned Selling Securityholder purchase Registrable
Securities in the ordinary course of business?

      Yes                     No                    If the answer is “No” to
question (d)(i), provide a brief explanation of the circumstances in which the
Selling Securityholder acquired the Registrable Securities:      

 

     

 

     

 

     

(ii)    At the time of the purchase of the Registrable Securities, did the
undersigned Selling Securityholder have any agreements, understandings or
arrangements, directly or indirectly, with any person to dispose of or
distribute the Registrable Securities?

      Yes                     No                    If the answer is “Yes” to
question (d)(ii), provide a brief explanation of such agreements, understandings
or arrangements:      

 

     

 

     

 

      If the answer is “No” to Item (8)(d)(i) or “Yes” to Item (8)(d)(ii), you
will be named as an underwriter in the Shelf Registration Statement and the
related Prospectus. (9)    Hedging and short sales:    (a)    State whether the
undersigned Selling Securityholder has or will enter into “hedging transactions”
with respect to the Registrable Securities:       Yes                     No
                   If “Yes”, provide below a complete description of the hedging
transactions into which the undersigned Selling Securityholder has entered or
will enter and the purpose of such hedging transactions, including the extent to
which such hedging transactions remain in place:      

 

     

 

     

 

 

A-7

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   (b)    Set forth below is Interpretation A.65 of the Commission’s July 1997
Manual of Publicly Available Interpretations regarding short selling:       “An
issuer filed a Form S-3 registration statement for a secondary offering of
common stock which is not yet effective. One of the selling shareholders wanted
to do a short sale of common stock “against the box” and cover the short sale
with registered shares after the effective date. The issuer was advised that the
short sale could not be made before the registration statement becomes
effective, because the shares underlying the short sale are deemed to be sold at
the time such sale is made. There would, therefore, be a violation of Section 5
if the shares were effectively sold prior to the effective date.”       By
returning this Notice and Questionnaire, the undersigned Selling Securityholder
will be deemed to be aware of the foregoing interpretation.

*    *    *    *    *

By signing below, the Selling Securityholder acknowledges that it understands
its obligation to comply, and agrees that it will comply, with the provisions of
the Exchange Act, particularly Regulation M (or any successor rule or
regulation).

The Selling Securityholder hereby acknowledges its obligations under the
Exchange and Registration Rights Agreement to indemnify and hold harmless the
Company and certain other persons as set forth in the Exchange and Registration
Rights Agreement.

In the event that the Selling Securityholder transfers all or any portion of the
Registrable Securities listed in Item (3) above after the date on which such
information is provided to the Company, the Selling Securityholder agrees to
notify the transferee(s) at the time of the transfer of its rights and
obligations under this Notice and Questionnaire and the Exchange and
Registration Rights Agreement.

By signing below, the Selling Securityholder consents to the disclosure of the
information contained herein in its answers to Items (1) through (9) above and
the inclusion of such information in the Shelf Registration Statement and
related Prospectus. The Selling Securityholder understands that such information
will be relied upon by the Company in connection with the preparation of the
Shelf Registration Statement and related Prospectus.

In accordance with the Selling Securityholder’s obligation under Section 3(d) of
the Exchange and Registration Rights Agreement to provide such information as
may be required by law for inclusion in the Shelf Registration Statement, the
Selling Securityholder agrees to promptly notify the Company of any inaccuracies
or changes in the information provided herein which may occur subsequent to the
date hereof at any time while the Shelf Registration Statement remains in effect
and to provide such additional information that the Company may reasonably
request regarding such Selling Securityholder and the intended method of
distribution of Registrable Securities in order to comply with the Securities
Act. Except as otherwise provided in the Exchange and Registration Rights
Agreement, all notices hereunder and pursuant to the Exchange and Registration
Rights Agreement shall be made in writing, by hand-delivery, first-class mail,
or air courier guaranteeing overnight delivery as follows:

 

(i) To the Company:       Abitibi-Consolidated Company of Canada   

1155 Metcalfe Street, Suite 800

 

Montreal, Quebec

 

Canada, H3B 5H2

   Attention: Corporate Secretary

 

A-8

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(ii) With a copy to:       Troutman Sanders LLP   

600 Peachtree Street, NE

 

Suite 5200

 

Atlanta, GA 30308

   Attention: Marlon Starr, Esq.

Once this Notice and Questionnaire is executed by the Selling Securityholder and
received by the Company’s counsel, the terms of this Notice and Questionnaire,
and the representations and warranties contained herein, shall be binding on,
shall inure to the benefit of and shall be enforceable by the respective
successors, heirs, personal representatives, and assigns of the Company and the
Selling Securityholder (with respect to the Registrable Securities beneficially
owned by such Selling Securityholder and listed in Item (3) above. This Notice
and Questionnaire shall be governed in all respects by the laws of the State of
New York.

 

A-9

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IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.

Dated:                         

 

 

Selling Securityholder (Print/type full legal name of beneficial owner of
Registrable Securities) By:  

 

Name:   Title:  

PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON
OR BEFORE [DEADLINE FOR RESPONSE] TO THE COMPANY’S COUNSEL AT:

 

      Troutman Sanders LLP             600 Peachtree Street, NE            
Suite 5200             Atlanta, GA 30308            
Attention: Marlon Starr, Esq.      

 

A-10

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Exhibit B

NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT

Wells Fargo Bank, National Association

Abitibi-Consolidated Company of Canada

c/o Wells Fargo Bank, National Association

Corporate Trust Services

213 Court Street, Suite 703

Middletown, CT 06457

Attention: Joseph P. O’Donnell

 

  Re: Abitibi-Consolidated Company of Canada (the “Company”)

15.5% Senior Notes due 2010

Dear Sirs:

Please be advised that                                  has transferred
$             aggregate principal amount of the above-referenced Notes pursuant
to an effective Registration Statement on Form [            ] (File
No. 333-            ) filed by the Company.

We hereby certify that the prospectus delivery requirements, if any, of the
Securities Act of 1933, as amended, have been satisfied and that the above-named
beneficial owner of the Notes is named as a “Selling Holder” in the Prospectus
dated [date] or in supplements thereto, and that the aggregate principal amount
of the Notes transferred are the Notes listed in such Prospectus opposite such
owner’s name.

 

Dated:       Very truly yours,    

 

    (Name)   By:  

 

    (Authorized Signature)

 

B-1