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AINSWORTH LUMBER CO. LTD.




6.750% Senior Notes due March 15, 2014




Exchange and Registration Rights Agreement




March 3, 2004



Goldman, Sachs & Co.
    As
representative of the several Purchasers
    named
in Schedule I to the Purchase Agreement

c/o Goldman, Sachs & Co.

85 Broad Street

New York, New York 10004



Ladies and Gentlemen:



     Ainsworth Lumber Co. Ltd., a corporation amalgamated under the laws of the
Province of British Columbia (the “Company”), proposes to issue and sell to the
Purchasers (as defined herein) upon the terms set forth in the Purchase
Agreement (as defined herein) US$210,000,000 aggregate principal amount of its
6.750% Senior Notes due March 15, 2014. As an inducement to the Purchasers to
enter into the Purchase Agreement and in satisfaction of a condition to the
obligations of the Purchasers thereunder, the Company agrees with the
Purchasers for the benefit of holders (as defined herein) from time to time of
the Transfer Restricted Securities (as defined herein) as follows:





	1.	 	Certain Definitions. For purposes of this Exchange and Registration
Rights 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.



     “Canadian Securities Laws” shall mean securities legislation promulgated
by any province of Canada and the rules and regulations thereunder.



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



     “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.



     “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



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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 Transfer Restricted Securities
that has returned a completed and signed Notice and Questionnaire to the
Company in accordance with Section 3(d)(ii) or 3(d)(iii) hereof.



     “Exchange Act” shall mean the Securities Exchange Act of 1934, or any
successor thereto, as the same shall be amended from time to time.



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



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



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



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



     The term “holder” shall mean the Purchasers and other persons who acquire
Transfer Restricted Securities from time to time (including any successors or
assigns), in each case for so long as such person owns any Transfer Restricted
Securities; provided that for purposes of any obligation of the Company to give
notice to any holders, “holder” shall mean the record owner of Transfer
Restricted Securities.



     “Indenture” shall mean the Indenture dated as of March 3, 2004 among the
Company and The Bank of New York, as Trustee (the “Trustee”), as the same shall
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.



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



     “Purchase Agreement” shall mean the Purchase Agreement, dated as of
February 27, 2004 between the Purchasers and the Company relating to the
Securities.



     “Purchasers” shall mean the Purchasers named in Schedule I to the Purchase
Agreement.



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



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



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



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     “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
Transfer Restricted Securities acquired by the broker-dealer directly from the
Company.



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



     “Securities” shall mean, collectively, the US$210,000,000 aggregate
principal amount of 6.750% Senior Notes due March 15, 2014 of the Company to be
issued and sold to the Purchasers on the Closing Date, and securities issued in
exchange therefor or in lieu thereof pursuant to the Indenture.



     “Securities Act” shall mean the Securities Act of 1933, or any successor
thereto, as the same shall be amended from time to time.



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



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



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



     “Transfer Restricted Securities” shall mean each Security; until:





	 	(1)	 	the date on which such Security has been exchanged by a
Person other than a broker-dealer for an Exchange Security in the
Exchange Offer;
	 
	 	(2)	 	following the exchange by a broker-dealer in the Exchange
Offer of a Security for an Exchange Security, the date on which such
Exchange Security is sold to a purchaser who receives from such
broker-dealer on or prior to the date of such sale a copy of the
prospectus contained in the Exchange Registration Statement;
	 
	 	(3)	 	the date on which such Security has been effectively
registered under the Securities Act and disposed of in accordance
with the Shelf Registration Statement;
	 
	 	(4)	 	the date on which such Security is distributed to the public
pursuant to Rule 144(k) under the Securities Act; or
	 
	 	(5)	 	such Security shall cease to be outstanding.





     “Trust Indenture Act” shall mean the Trust Indenture Act of 1939, or any
successor thereto, and the rules, regulations and forms promulgated thereunder,
all as the same shall be amended from time to time.



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     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 Exchange
and Registration Rights Agreement, and the words “herein,” “hereof” and
“hereunder” and other words of similar import refer to this Exchange and
Registration Rights 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 on or prior to 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,
which debt securities are substantially identical to the Securities (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 the additional interest
contemplated in Section 2(c) below (such new debt securities hereinafter
called “Exchange Securities”). The Exchange Securities will be issued as
evidence of the same continuing indebtedness of the Company and will not
constitute the creation of new indebtedness. The Company agrees to use
its best efforts to cause the Exchange Registration Statement to become
effective under the Securities Act on or prior to 180 days after the
Closing Date and the Company further agrees to use its commercially
reasonable efforts to cause the Exchange Registration Statement to become
effective under the Securities Act as promptly as reasonably possible.
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. The Company further agrees to
use its best efforts to commence and complete the Exchange Offer on or
prior to 45 business days after such registration statement has become
effective, hold the Exchange Offer open for at least 30 days and exchange
Exchange Securities for all Transfer Restricted Securities that have been
properly tendered and not withdrawn on or prior to the expiration of the
Exchange Offer. The Exchange Offer will be deemed to have been
“completed” only if the debt securities received by holders other than
Restricted Holders in the Exchange Offer for Transfer Restricted
Securities are, upon receipt, transferable by each such holder without
restriction under the Securities Act and the Exchange Act and without
material restrictions under blue sky or securities laws of a substantial
majority of the States of the United States. The Exchange Offer shall be
deemed to have been completed upon the earlier to occur of (i) the
Company having exchanged the Exchange Securities for all outstanding
Transfer Restricted Securities pursuant to the Exchange Offer and (ii)
the Company having exchanged, pursuant to the Exchange Offer, Exchange
Securities for all Transfer Restricted 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 30 days following the
commencement of the Exchange Offer. The Company agrees (x) to include in
the Exchange Registration Statement a prospectus for use in any resales
by any holder of Exchange Securities that is a broker-dealer that has
acquired such Transfer Restricted Securities for its own account as a
result of market-making activities or other trading activities and not
directly from the Company, and (y) to keep such Exchange Registration



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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 180th day after the Exchange
Offer has been completed or such time as such broker-dealers no longer
own any Transfer Restricted Securities, other than Transfer Restricted
Securities acquired from the Company. With respect to such Exchange
Registration Statement, such holders shall have the benefit of the rights
of indemnification and contribution set forth in Sections 6(a), (c), (d)
and (e) hereof.




(b) If (i) on or prior to the time the Exchange Offer is completed
existing Commission interpretations are changed such that the debt
securities received by holders other than Restricted Holders in the
Exchange Offer for Transfer Restricted Securities are not or would not
be, upon receipt, transferable by each such holder without restriction
under the Securities Act, (ii) the Exchange Offer has not been completed
within the applicable time period set forth in section 2(a) hereof or
(iii) the Exchange Offer is not available to any holder of the
Securities, the Company and the Guarantor 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 on or prior
to 60 days after the time such obligation to file arises, 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 Transfer
Restricted 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 its best efforts (x) to cause the Shelf
Registration Statement to become or be declared effective on or prior to
150 days after such obligation to file arises and 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 Transfer Restricted Securities outstanding,
provided, however, that 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 Transfer Restricted
Securities unless such holder is an Electing Holder, and (y) after the
Effective Time of the Shelf Registration Statement, promptly upon the
request of any holder of Transfer Restricted Securities that is not then
an Electing Holder, to take any action reasonably necessary to enable
such holder to use the prospectus forming a part thereof for resales of
Transfer Restricted Securities, including, without limitation, any action
necessary to identify such holder as a selling securityholder in the
Shelf Registration Statement, provided, however, that nothing in this
clause (y) 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) hereof. The Company further agrees to
supplement or make amendments to the Shelf Registration Statement, as and
when required by the rules, regulations or instructions applicable to the
registration form used by the Company for such Shelf Registration
Statement or by the Securities Act or rules and regulations thereunder
for shelf registration, and the Company agrees to furnish to each
Electing Holder copies of any such supplement or amendment prior to its
being used or promptly following its filing with the Commission.




(c) In the event that (i) the Company has not filed the Exchange
Registration Statement or Shelf Registration Statement on or prior to the
date on which such registration statement is required to be filed
pursuant to Section 2(a) or 2(b), respectively, or (ii) such Exchange
Registration Statement or Shelf Registration Statement has not become



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effective or been declared effective by the Commission on or prior to the
date on which such registration statement is required to become or be
declared effective pursuant to Section 2(a) or 2(b), respectively, or
(iii) the Exchange Offer has not been completed within 45 business days
after the initial effective date 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 2(b) hereof is filed
and declared effective but thereafter ceases to be effective or usable in
connection with resales of Transfer Restricted Securities during the time
periods specified herein (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, with
respect to the first 90-day period immediately following the occurrence
of the first Registration Default in an amount equal to US$.05 per week
per US$1,000 principal amount of Securities held by such Holder. The
amount of the Special Interest will increase by an additional US$.05 per
week per US$1,000 principal amount of Securities with respect to each
subsequent 90 day Registration Default Period until all Registration
Defaults have been cured, up to a maximum amount of Special Interest for
all Registration Defaults of US$.50 per week per US$1,000 principal
amount of Securities. The Company shall not be required to pay Special
Interest for more than one Registration Default at any given time.
Following the cure of all Registration Defaults, the accrual of Special
Interest will cease. The Company shall pay all Special Interest, if any,
in the manner and on the dates specified in the Indenture.




(d) The Company shall use its best efforts to take all actions necessary
or advisable to be taken by it to ensure that the transactions
contemplated herein are effected as so contemplated.




(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 files 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 Offer or the Shelf
Registration, as the case may be, the Company shall qualify the Indenture
under the Trust Indenture Act.




(b) In the event that qualification of the Indenture under the Trust
Indenture Act 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 obligations with respect to the
registration of Exchange Securities as contemplated by Section 2(a) (the
“Exchange Registration”), if applicable, the Company shall, as soon as
practicable (or as otherwise specified):





	 	(i)	 	prepare and file with the Commission on or prior
to 90 days after the Closing Date, an Exchange Registration
Statement on any form which may be utilized by the Company and
which shall permit the Exchange Offer and resales of Exchange
Securities by broker-dealers that have not acquired Transfer
Restricted Securities directly from the Company during the
Resale Period to be effected as contemplated by Section 2(a),
and use its best efforts to cause such Exchange Registration
Statement to become effective on or prior to 180 days after
the Closing Date;
	 
	 	(ii)	 	as soon as practicable prepare and file with the
Commission 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) hereof 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 not acquired
directly from the Company 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 and the
rules and regulations of the Commission thereunder, 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 or, to the knowledge of the Company, received copies
of the prospectus included in such registration statement, and
confirm such advice in writing, (A) in cases where a
broker-dealer has specifically requested such information,
when such Exchange Registration Statement or the prospectus
included therein or any prospectus amendment or supplement or
post-effective amendment has been filed, (B) with respect to
such Exchange Registration Statement or any post-effective
amendment, when the same has become effective, (C) in cases
where a broker-dealer has specifically requested such
information, of any comments by the Commission and by the blue
sky or securities commissioner or regulator of any state or
province with respect thereto or any request by the Commission
for amendments or supplements to such Exchange Registration
Statement or prospectus or for additional information, (D) 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, (E) 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, (F) of the receipt by the
Company of any notification with respect to the suspension





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	 	 	 	of the qualification of the Exchange Securities for sale in
any jurisdiction or the initiation or threatening of any
proceeding for such purpose, or (G) 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 and the rules and regulations of
the Commission thereunder or any applicable Canadian
Securities Laws 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;
	 
	 	(iv)	 	in the event that the Company would be required,
pursuant to Section 3(c)(iii)(F) above, to notify any
broker-dealers holding Exchange Securities, without delay
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 the rules and
regulations of the Commission thereunder 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 its best 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 its best 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)
and ensure that the Exchange Securities can be offered in a
private placement in each of the provinces of Canada where
holders are resident on or prior to the commencement of the
Exchange Offer, (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 and
(C) take any and all other actions as may be reasonably
necessary or advisable to enable each broker-dealer holding
Exchange Securities not acquired directly from the Company to
consummate the disposition thereof in such jurisdictions;
provided, however, that the Company shall not 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, (3) make any changes to its constating documents
or by-laws or any agreement between it and its shareholders or
(4) file a prospectus in any province or





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	 	 	 	territory of Canada to make the Transfer Restricted
Securities or Exchange Securities freely tradeable in Canada;
	 
	 	(vii)	 	use its best efforts to obtain the consent or
approval of each governmental agency or authority, whether
federal, state, provincial 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;
	 
	 	(viii)	 	provide a CUSIP number for all Exchange Securities, not
later than the applicable Effective Time; and
	 
	 	(ix)	 	comply with all applicable rules and regulations
of the Commission and make generally available to its
securityholders as soon as practicable but no later than
eighteen months after the effective date 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 obligations with respect to the
Shelf Registration, if applicable, the Company shall, as soon as
practicable (or as otherwise specified):







	 	(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 Transfer Restricted Securities
for resale by the holders thereof in accordance with such
method or methods of disposition as may be specified by such
of the holders as, from time to time, may be Electing Holders
and use its best efforts to cause such Shelf Registration
Statement to become effective within the time periods
specified in Section 2(b);
	 
	 	(ii)	 	not less than 30 calendar days prior to the
Effective Time of the Shelf Registration Statement, mail the
Notice and Questionnaire to the holders of Transfer Restricted
Securities; provided that no holder shall be entitled to be
named as a selling securityholder in the Shelf Registration
Statement as of the Effective Time, and no holder shall be
entitled to use the prospectus forming a part thereof for
resales of Transfer Restricted Securities at any time, unless
such holder has returned a completed and signed Notice and
Questionnaire to the Company by the deadline for response set
forth therein; and provided, further, holders of Transfer
Restricted Securities shall have at least 28 calendar days
from the date on which the Notice and Questionnaire is first
mailed to such holders to return a completed and signed Notice
and Questionnaire to the Company;
	 
	 	(iii)	 	after the Effective Time of the Shelf
Registration Statement, upon the request of any holder of
Transfer Restricted 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





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	 	 	 	Statement or to enable such holder to use the prospectus
forming a part thereof for resales of Transfer Restricted
Securities until 30 days after 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) hereof 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;
	 
	 	(v)	 	comply with the provisions of the Securities Act
and any applicable Canadian Securities Laws with respect to
the disposition of all of the Transfer Restricted 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 (A) the Electing Holders, (B) the
underwriters (which term, for purposes of this Exchange and
Registration Rights Agreement, shall include a person deemed
to be an underwriter within the meaning of Section 2(a)(11) of
the Securities Act), if any, thereof, (C) any sales or
placement agent therefor, (D) counsel for any such underwriter
or agent and (E) not more than one counsel for all the
Electing Holders, the opportunity to review and provide
comments in connection with 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 during reasonable
business hours 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
Transfer Restricted 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 independent chartered accountants of the Company
to respond to such inquiries, as shall be reasonably
necessary, in the judgment of the respective counsel referred
to in such Section, to conduct a reasonable investigation
within the meaning of Section 11 of the Securities Act;
provided, however, that each such party shall be required to
agree in writing 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





10









 







	 	 	 	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 of the United
States 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, any sales or
placement agent therefor and any underwriter thereof (which
notification may be made through any managing underwriter that
is a representative of such underwriter for such purpose) 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) in cases where an Electing
Holder has specifically requested such information in writing,
of any comments by the Commission and by the blue sky or
securities commissioner or regulator of any state or province
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 contemplated by Section 3(d)(xvii) or 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 Transfer Restricted
Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, or (F) 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 and the rules and regulations of
the Commission thereunder or any applicable Canadian
Securities Laws or contains an untrue statement of a material
fact or omits to state any material fact required to





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	 	 	 	be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing;
	 
	 	(ix)	 	use its best efforts to obtain the withdrawal of
(A) any order suspending the effectiveness of such Shelf
Registration Statement or any post-effective amendment thereto
at the earliest practicable date or (B) the suspension of the
qualification of the Transfer Restricted Securities for sale
in any jurisdiction;
	 
	 	(x)	 	if requested by any managing underwriter or
underwriters, any placement or sales agent or 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 managing underwriter or underwriters, such agent or such
Electing Holder specifies should be included therein relating
to the terms of the sale of such Transfer Restricted
Securities, including information with respect to the
principal amount of Transfer Restricted Securities being sold
by such Electing Holder or agent or to any underwriters, the
name and description of such Electing Holder, agent or
underwriter, the offering price of such Transfer Restricted
Securities and any discount, commission or other compensation
payable in respect thereof, the purchase price being paid
therefor by such underwriters and with respect to any other
terms of the offering of the Transfer Restricted Securities to
be sold by such Electing Holder or agent or to such
underwriters; 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, each placement
or sales agent, if any, therefor, each underwriter, if any,
thereof and the respective counsel referred to in Section
3(d)(vi) an executed copy (or, in the case of an Electing
Holder, 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 Transfer Restricted 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, agent or underwriter, as the case may be) 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 and the rules and regulations of the
Commission thereunder and any applicable Canadian Securities
Laws, and such other documents, as such Electing Holder,
agent, if any, and underwriter, if any, may reasonably request
in order to facilitate the offering and disposition of the
Transfer Restricted Securities owned by such Electing Holder,
offered or sold by such agent or underwritten by such
underwriter and to permit such





12









 







	 	 	 	Electing Holder, agent and underwriter to satisfy the
prospectus delivery requirements of the Securities Act and
any applicable Canadian Securities Laws; and 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 and by any
such agent and underwriter, in each case in the form most
recently provided to such person by the Company, in
connection with the offering and sale of the Transfer
Restricted Securities covered by the prospectus (including
such preliminary and summary prospectus) or any supplement or
amendment thereto provided, however, that the Company shall
not be required for any such purpose to file a prospectus in
any province or territory of Canada to make the Transfer
Restricted Securities or Exchange Securities freely tradable
in Canada;
	 
	 	(xii)	 	use its best efforts to (A) register or qualify
the Transfer Restricted Securities to be included in such
Shelf Registration Statement under such securities laws or
blue sky laws of such jurisdictions as any Electing Holder and
each placement or sales agent, if any, therefor and
underwriter, if any, thereof shall reasonably request and
ensure that any Transfer Restricted securities can be offered
in a private placement in all the provinces of Canada where
the holders are resident, (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) above and
for so long as may be necessary to enable any such Electing
Holder, agent or underwriter to complete its distribution of
Securities pursuant to such Shelf Registration Statement and
(C) take any and all other actions as may be reasonably
necessary or advisable to enable each such Electing Holder,
agent, if any, and underwriter, if any, to consummate the
disposition in such jurisdictions of such Transfer Restricted
Securities; provided, however, that the Company shall not 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, (3) make any changes to its
constating documents or by-laws or any agreement between it
and its shareholders or, as applicable, (4) file a prospectus
in any province or territory of Canada to make the Transfer
Restricted Securities or Exchange Securities freely tradeable
in Canada;
	 
	 	(xiii)	 	use its best efforts to obtain the consent or approval of
each governmental agency or authority, whether federal or
state, 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 Transfer Restricted Securities in the
United States;
	 
	 	(xiv)	 	unless any Transfer Restricted Securities shall
be in book-entry only form, cooperate with the Electing
Holders and the managing underwriters, if





13









 







	 	 	 	any, to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Securities to
be sold, which certificates, if so required by any securities
exchange upon which any Transfer Restricted Securities are
listed, shall be penned, lithographed or engraved, or
produced by any combination of such methods, on steel
engraved borders, and which certificates shall not bear any
restrictive legends; and, in the case of an underwritten
offering, enable such Transfer Restricted Securities to be in
such denominations and registered in such names as the
managing underwriters may request at least two business days
prior to any sale of the Transfer Restricted Securities;
	 
	 	(xv)	 	provide a CUSIP number for all Transfer
Restricted Securities, not later than the applicable Effective
Time;
	 
	 	(xvi)	 	enter into one or more underwriting agreements,
engagement letters, agency agreements, “best efforts”
underwriting agreements or similar agreements, as appropriate,
including customary provisions relating to indemnification and
contribution, and take such other actions in connection
therewith as any Electing Holders aggregating at least 33% in
aggregate principal amount of the Transfer Restricted
Securities at the time outstanding shall request in order to
expedite or facilitate the disposition of such Transfer
Restricted Securities in the United States; provided that the
Company shall not be required to enter into any such agreement
more than twice with respect to all of the Transfer Restricted
Securities and may delay entering into any such agreement
until the consummation of any underwritten public offering in
which the Company shall be engaged provided that such delay is
reasonable;
	 
	 	(xvii)	 	whether or not an agreement of the type referred to in
Section 3(d)(xvi) hereof is entered into and whether or not
any portion of the offering contemplated by the Shelf
Registration is an underwritten offering or is made through a
placement or sales agent or any other entity, (A) make such
representations and warranties to the Electing Holders and the
placement or sales agent, if any, therefor and the
underwriters, if any, thereof in form, substance and scope as
are customarily made in connection with an offering of debt
securities pursuant to any appropriate agreement or to a
registration statement filed on the form applicable to the
Shelf Registration; (B) obtain an opinion of counsel to the
Company in customary form and covering such matters, of the
type customarily covered by such an opinion as the managing
underwriters, if any, or as any Electing Holders of at least
33% in aggregate principal amount of the Transfer Restricted
Securities at the time outstanding may reasonably request,
addressed to such Electing Holder or Electing Holders and the
placement or sales agent, if any, therefor and the
underwriters, if any, thereof and dated the effective date of
such Shelf Registration Statement (and if such Shelf
Registration Statement contemplates an underwritten offering
of a part or all of the Transfer Restricted Securities, dated
the date of the closing under the underwriting agreement
relating thereto) (it being





14









 







	 	 	 	agreed that the matters to be covered by such opinion shall
include the due incorporation or amalgamation, as applicable,
and good standing of the Company and its subsidiaries, if
any; the qualification of the Company and its subsidiaries,
if any, to transact business as foreign corporations or
extra-provincial corporations; the due authorization,
execution and delivery of the relevant agreement of the type
referred to in Section 3(d)(xvi) hereof; the due
authorization, execution, authentication and issuance, and
the validity and enforceability, of the Securities; the
absence of material legal or governmental proceedings
involving the Company or any of its subsidiaries; the absence
of a conflict of the Offering with material agreements
binding upon the Company or any subsidiary of the Company;
the absence of governmental approvals required to be obtained
in connection with the Shelf Registration, the offering and
sale of the Transfer Restricted Securities, this Exchange and
Registration Rights Agreement or any agreement of the type
referred to in Section 3(d)(xvi) hereof, except such
approvals as may be required under state securities or blue
sky laws; the material compliance as to form of such Shelf
Registration Statement and any documents incorporated by
reference therein and of the Indenture with the requirements
of the Securities Act and the Trust Indenture Act and the
rules and regulations of the Commission thereunder,
respectively; and, as of the date of the opinion and of the
Shelf Registration Statement or most recent post-effective
amendment thereto, as the case may be, the absence from such
Shelf Registration Statement and the prospectus included
therein, as then amended or supplemented, and from the
documents incorporated by reference therein (in each case
other than the financial statements and other financial
information contained therein) of an untrue statement of a
material fact or the omission to state therein a material
fact necessary to make the statements therein not misleading
(in the case of such documents, in the light of the
circumstances existing at the time that such documents were
filed with the Commission under the Exchange Act)); (C)
obtain a “cold comfort” letter or letters from the
independent chartered accountants of the Company addressed to
the selling Electing Holders, the placement or sales agent,
if any, therefor or the underwriters, if any, thereof, dated
(i) the effective date of such Shelf Registration Statement
and (ii) the effective date of any prospectus supplement to
the prospectus included in such Shelf Registration Statement
or post-effective amendment to such Shelf Registration
Statement which includes unaudited or audited financial
statements as of a date or for a period subsequent to that of
the latest such statements included in such prospectus (and,
if such Shelf Registration Statement contemplates an
underwritten offering pursuant to any prospectus supplement
to the prospectus included in such Shelf Registration
Statement or post-effective amendment to such Shelf
Registration Statement which includes unaudited or audited
financial statements as of a date or for a period subsequent
to that of the latest such statements included in such
prospectus, dated the date of the closing under the
underwriting agreement relating thereto), such letter or
letters to be in customary form and covering such matters of
the type customarily covered





15









 







	 	 	 	by letters of such type; (D) deliver such documents and
certificates, including officers’ certificates, as may be
reasonably requested by any Electing Holders of at least 33%
in aggregate principal amount of the Transfer Restricted
Securities at the time outstanding or the placement or sales
agent, if any, therefor and the managing underwriters if any,
thereof to evidence the accuracy of the representations and
warranties made pursuant to clause (A) above or those
contained in Section 5(a) hereof and the compliance with or
satisfaction of any agreements or conditions contained in the
underwriting agreement or other agreement entered into by the
Company; and (E) undertake such obligations relating to
expense reimbursement, indemnification and contribution as
are provided in Section 6 hereof;
	 
	 	(xviii)	 	notify in writing each holder of Transfer Restricted
Securities of any proposal by the Company to amend or waive
any provision of this Exchange and Registration Rights
Agreement pursuant to Section 9(h) hereof 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;
	 
	 	(xix)	 	in the event that any broker-dealer registered
under the Exchange Act shall underwrite any Transfer
Restricted Securities or participate as a member of an
underwriting syndicate or selling group or “assist in the
distribution” (within the meaning of the Conduct Rules (the
“Conduct Rules) of the National Association of Securities
Dealers, Inc. (“NASD”) or any successor thereto, as amended
from time to time) thereof, whether as a holder of such
Transfer Restricted Securities or as an underwriter, a
placement or sales agent or a broker or dealer in respect
thereof, or otherwise, assist such broker-dealer in complying
with the requirements of such Conduct Rules, including by (A)
if such Conduct Rules shall so require, engaging a “qualified
independent underwriter” (as defined in such Conduct Rules) to
participate in the preparation of the Shelf Registration
Statement relating to such Transfer Restricted Securities, to
exercise usual standards of due diligence in respect thereto
and, if any portion of the offering contemplated by such Shelf
Registration Statement is an underwritten offering or is made
through a placement or sales agent, to recommend the yield of
such Transfer Restricted Securities, (B) indemnifying any such
qualified independent underwriter to the extent of the
indemnification of underwriters provided in Section 6 hereof
(or to such other customary extent as may be requested by such
underwriter), and (C) providing such information to such
broker-dealer as may be required in order for such
broker-dealer to comply with the requirements of the Conduct
Rules; and
	 
	 	(xx)	 	comply with all applicable rules and regulations
of the Commission, and make generally available to its
securityholders as soon as practicable but in any event not
later than eighteen months after the effective date of such
Shelf Registration Statement, an earning statement of the
Company and its











16









 







	 	 	 	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(c)(iii)(F) or Section 3(d)(viii)(F) above, to notify each
broker-dealer, the Electing Holders, the placement or sales agent, if
any, therefor and the managing underwriters, if any, thereof, the Company
shall without delay prepare and furnish to each of the Electing Holders,
to each placement or sales agent, if any, and to each such underwriter,
if any, a reasonable number of copies of a prospectus supplemented or
amended so that, as thereafter delivered to purchasers of Transfer
Restricted Securities, such prospectus shall conform in all material
respects to the applicable requirements of the Securities Act and the
Trust Indenture Act and the rules and regulations of the Commission
thereunder and any applicable Canadian Securities Laws 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(c)(iii)(F) or Section
3(d)(viii)(F) hereof, such broker-dealer, Electing Holder, underwriter or
placement or sales agent shall forthwith discontinue the disposition of
Transfer Restricted Securities pursuant to the Shelf Registration
Statement applicable to such Transfer Restricted Securities until such
broker-dealer, Electing Holder, underwriter or placement or sales agent
shall have received copies of such amended or supplemented prospectus and
if so directed by the Company, such broker-dealer, Electing Holder,
underwriter or placement or sales agent shall destroy or 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 Transfer Restricted 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
Questionnaire, the Company may require 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 Transfer
Restricted Securities as may be required in the reasonable judgment of
counsel for the Company 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 Transfer Restricted Securities or
omits to state any material fact regarding such Electing Holder or such
Electing Holder’s intended method of disposition of such Transfer
Restricted 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 Transfer
Restricted 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.



17









 






(g) As a condition to its participation in the Exchange Offer pursuant to
the terms of this Agreement, each holder of Transfer Restricted
Securities shall furnish, upon the request of the Company, prior to the
completion of the Exchange Offer, a written representation to the Company
(which may be contained in the letter of transmittal contemplated by the
Exchange Registration Statement) to the effect that (A) it is not an
affiliate of the Company, (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 and (C) it is acquiring the Exchange Securities in its
ordinary course of business, and such holder shall make such other
written representations as the Company may reasonably request in order to
comply with applicable Canadian securities laws. As a condition to its
participation in the Exchange Offer pursuant to the terms of this
Agreement, each holder shall acknowledge and agree that any broker-dealer
and any such holder using the Exchange Offer to participate in a
distribution of the securities to be acquired in the Exchange Offer (1)
could not under Commission policy as in effect on the date of this
Agreement rely on the position of the Commission enunciated in Morgan
Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital Holdings
Corporation (available May 13, 1988), as interpreted in the Commission’s
letter to Shearman & Sterling dated July 2, 1993, and similar no-action
letters and (2) must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with a secondary resale
transaction and that such a secondary resale transaction must be covered
by an effective registration statement containing the selling security
holder information required by Item 507 or 508, as applicable, of
Regulation S-K if the resales are of Exchange Securities obtained by such
holder in exchange for Securities acquired by such holder directly from
the Company.




(h) Until the expiration of two years 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 under the
Securities Act.





	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
Exchange and Registration Rights Agreement, including (a) all Commission
and any NASD registration, filing and review fees and expenses including
reasonable fees and disbursements of counsel for the placement or sales
agent or underwriters in connection with such registration, filing and
review, (b) all fees and expenses in connection with the qualification of
the Securities for offering and sale under the State securities and blue
sky laws referred to in Section 3(d)(xii) hereof and determination of
their eligibility for investment under the laws of such jurisdictions as
any managing underwriters or the Electing Holders may designate,
including any reasonable fees and disbursements of counsel for the
Electing Holders or underwriters 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



18









 






for delivery and the expenses of printing or producing any underwriting
agreements, agreements among underwriters, selling agreements and blue
sky or legal investment memoranda and all other documents in connection
with the offering, sale or delivery of Securities to be disposed of
(including certificates representing the Securities), (d) messenger,
telephone and delivery expenses relating to the offering, sale or
delivery of Securities 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, security trustee or custodian, (f) internal
expenses (including all salaries and expenses of the Company’s officers
and employees performing legal or accounting duties), (g) fees,
disbursements and expenses of counsel of the Company and independent
chartered accountants of the Company (including the expenses of any
opinions or “cold comfort” letters required by or incident to such
performance and compliance), (h) fees, disbursements and expenses of any
“qualified independent underwriter” engaged pursuant to Section 3(d)(xix)
hereof, (i) 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 Transfer Restricted Securities held
by Electing Holders (which counsel shall be reasonably satisfactory to
the Company), (j) any fees charged by securities rating services for
rating the Securities, and (k) 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 Transfer Restricted Securities or any
placement or sales agent therefor or underwriter thereof, 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 Transfer
Restricted Securities being registered shall pay all agency fees and
commissions and underwriting discounts and commissions attributable to
the sale of such Transfer Restricted Securities 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.




The Company represents and warrants to, and agrees with, each Purchaser and
each of the holders from time to time of Transfer Restricted Securities that:





(a) Each registration statement covering Transfer Restricted Securities
and each prospectus (including any preliminary or summary prospectus)
contained therein or furnished pursuant to Section 3(d) or Section 3(c)
hereof 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, and, in the case of an underwritten
offering of Transfer Restricted Securities, at the time of the closing
under the underwriting agreement relating thereto, will conform in all
material respects to the requirements of the Securities Act and the Trust
Indenture Act and the rules and regulations of the Commission thereunder
and any applicable Canadian Securities Laws 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
in the case of a registration statement, not misleading, and in the case
of a prospectus not misleading in



19









 






light of the circumstances under which they were made; 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 Transfer Restricted Securities
pursuant to Section 3(d)(viii)(F) or Section 3(c)(iii)(F) hereof until
(ii) such time as the Company furnishes an amended or supplemented
prospectus pursuant to Section 3(e) or Section 3(c)(iv) hereof, each such
registration statement, and each prospectus (including any summary
prospectus) contained therein or furnished pursuant to Section 3(d) or
Section 3(c) hereof, as then amended or supplemented, will conform in all
material respects to the requirements of the Securities Act and the Trust
Indenture Act and the rules and regulations of the Commission thereunder
and any applicable Canadian Securities Laws 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 Transfer
Restricted Securities or any underwriter or placement agent of any
offering described therein expressly for use therein.




(b) Any documents incorporated by reference in any prospectus referred to
in Section 5(a) hereof, 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, the Exchange Act or any applicable Canadian Securities Laws, 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 Transfer Restricted
Securities or any underwriter or placement agent of any offering
described therein expressly for use therein.




(c) The compliance by the Company with all of the provisions of this
Exchange and Registration Rights Agreement and the consummation of the
transactions herein contemplated will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any subsidiary of the
Company is a party or by which the Company or any subsidiary of the
Company is bound or to which any of the property or assets of the Company
or any subsidiary of the Company is subject, nor will such action result
in any violation of the provisions of the articles of amalgamation or
incorporation or the by-laws or other organizational documents, as
applicable, of the Company or any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any subsidiary of the Company or any of
their 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 of the
transactions contemplated by this Exchange and Registration Rights
Agreement, except the registration under the Securities Act of the
Transfer Restricted Securities and the Exchange Securities, qualification
of the Indenture under the Trust Indenture Act and



20









 






such consents, approvals, authorizations, registrations or qualifications
as may be required under any applicable Canadian Securities Laws,
Canadian federal or provincial corporate law or State securities or blue
sky laws in connection with the offering and distribution of the Transfer
Restricted Securities and the Exchange Securities.




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





	6.	 	Indemnification.






(a) Indemnification by the Company. The Company will indemnify and hold
harmless each of the holders of Transfer Restricted Securities included
in an Exchange Registration Statement, each of the Electing Holders of
Transfer Restricted Securities included in a Shelf Registration Statement
and each person who participates as a placement or sales agent or as an
underwriter in any offering or sale of such Transfer Restricted
Securities against any losses, claims, damages or liabilities, joint or
several, to which such holder, agent or underwriter 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 Shelf
Registration Statement, as the case may be, under which such Transfer
Restricted Securities were registered under the Securities Act, or any
preliminary, final or summary prospectus contained therein or furnished
by the Company to any such holder, Electing Holder, agent or underwriter,
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 such holder, such Electing Holder,
such agent and such underwriter for any 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 the Company shall not 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, 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 provided, further, that in a disposition of Transfer Restricted
Securities that does not involve (in whole or in part) an underwritten
offering conducted pursuant to Section 7 hereof or a “best efforts”
offering on an agency basis, the Company shall not be liable to any
Electing Holder pursuant to the foregoing with respect to any prospectus
contained in a Shelf Registration Statement (a “Prior Prospectus”) to the
extent the Company shall sustain the burden of proving that any such
loss, claim, damage or liability resulted from the fact that such
Electing Holder sold Transfer Restricted Securities to a person to whom
such Electing Holder failed to send or give, at or prior to the
settlement date (the “Settlement Date”) of such sale, a copy of an
amended or supplemented prospectus (the “Amended Prospectus”), if: (i)
the notice required by Section 3(d)(viii) hereof in respect of the
Amended Prospectus has been given to such Electing Holder prior to the
Settlement Date, (ii) the Company has previously delivered copies of the
Amended Prospectus to the Electing Holder (in sufficient quantities and
sufficiently in advance of the Settlement



21









 






Date to allow for delivery of the Amended Prospectus by the Electing
Holder to the transferee of such Transfer Restricted Securities by the
Settlement Date) and the loss, claim, damage or liability of such
Electing Holder resulted from an untrue statement or omission of a
material fact contained in or omitted from a Prior Prospectus that was
identified in writing at such time to such Electing Holder and corrected
in the Amended Prospectus prior to the Settlement Date and the Amended
Prospectus was required by law to be delivered at or prior to the
Settlement Date to such person and (iii) and delivery of the Amended
Prospectus by the Settlement Date would have cured the defect giving rise
to such loss, claim, damage or liability.




(b) Indemnification by the Holders and any Agents and Underwriters. The
Company may require, as a condition to including any Transfer Restricted
Securities in any registration statement filed pursuant to Section 2(b)
hereof and to entering into any underwriting agreement with respect
thereto, that the Company shall have received an undertaking reasonably
satisfactory to it from the Electing Holder of such Transfer Restricted
Securities and from each underwriter named in any such underwriting
agreement severally and not jointly, to (i) indemnify and hold harmless
the Company and all other holders of Transfer Restricted Securities,
against any losses, claims, damages or liabilities to which the Company
or such other holders of Transfer Restricted Securities 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 contained therein or furnished
by the Company to any such Electing Holder, agent or underwriter, 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, agent or
underwriter expressly for use therein, and (ii) reimburse the Company for
any legal or other expenses reasonably incurred by the Company 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 Transfer Restricted 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 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 6(b) hereof. 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



22









 






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 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 or any agents or underwriters
or all of them 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 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 Transfer Restricted
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
untrue statement or omission or alleged omission, and no underwriter
shall be required to contribute any amount in excess of the amount by
which



23









 






the total price at which the Transfer Restricted Securities underwritten
by it and distributed to the public were offered to the public exceeds
the amount of any damages which such underwriter has otherwise been
required to pay by reason of such untrue or alleged 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’ and any underwriters’
obligations in this Section 6(d) to contribute shall be several in
proportion to the principal amount of Transfer Restricted Securities
registered or underwritten, as the case may be, by them and not joint.




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





	7.	 	Underwritten Offerings.






(a) Selection of Underwriters. If any of the Transfer Restricted
Securities covered by the Shelf Registration are to be sold pursuant to
an underwritten offering, the managing underwriter or underwriters
thereof shall be designated by Electing Holders holding at least a
majority in aggregate principal amount of the Transfer Restricted
Securities to be included in such offering, provided that such designated
managing underwriter or underwriters is or are reasonably acceptable to
the Company.




(b) Participation by Holders. Each holder of Transfer Restricted
Securities hereby agrees with each other such holder that no such holder
may participate in any underwritten offering hereunder unless such holder
(i) agrees to sell such holder’s Transfer Restricted Securities on the
basis provided in any underwriting arrangements approved by the persons
entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the
terms of such underwriting arrangements.





	8.	 	Rule 144.





     The Company covenants to the holders of Transfer Restricted Securities
that to the extent it shall be required to do so under the Exchange Act, it
shall timely file the reports required to be filed by it under the Exchange Act
or the Securities Act (including the reports under Section 13 and 15(d) of the
Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the
Commission under the Securities Act) and the rules and regulations adopted by
the Commission thereunder, and shall take such further action as any holder of
Transfer Restricted Securities may reasonably request, all to the extent
required from time to time to enable such holder to sell



24









 







Transfer Restricted Securities without registration under the Securities
Act within the limitations of the exemption provided by Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or any similar
or successor rule or regulation hereafter adopted by the Commission. Upon the
request of any holder of Transfer Restricted 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.





	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 Transfer Restricted Securities or any
other securities which would be inconsistent with the terms contained in
this Exchange and Registration Rights 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 Purchasers and the holders from
time to time of the Transfer Restricted Securities may be irreparably
harmed by any such failure, and accordingly agree that the Purchasers 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 Exchange and
Registration Rights Agreement in accordance with the terms and conditions
of this Exchange and Registration Rights Agreement, in any court of the
United States or any State thereof having jurisdiction.




(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 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 Ainsworth Lumber Co. Ltd., Suite 3194 Bentall IV, PO
Box 49307, 1055 Dunsmuir Street, Vancouver, British Columbia, Canada V7X
1L3, Attention: Catherine Ainsworth, Chief Operating Officer, 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 Exchange
and Registration Rights Agreement shall be binding upon, shall inure to
the benefit of and shall be enforceable by the parties hereto and the
holders from time to time of the Transfer Restricted Securities and the
respective successors and assigns of the parties hereto and such holders.
In the event that any transferee of any holder of Transfer Restricted
Securities shall acquire Transfer Restricted 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 Transfer Restricted
Securities shall be held subject to all of the terms of this Exchange and
Registration Rights Agreement, and by taking and holding such Transfer
Restricted 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



25









 






provisions of this Exchange and Registration Rights Agreement. If the
Company shall so request, any such successor, assign or transferee shall
agree in writing to acquire and hold the Transfer Restricted Securities
subject to all of the applicable terms hereof.




(e) Guarantors. The Company hereby covenants that in the event that
prior to (i) the consummation of the Exchange Offer, if the Exchange
Offer is consummated or (ii) the termination of the period referred to in
Section 2(b) of this agreement, if the Shelf Registration is effected,
any subsidiary of the Company becomes a Subsidiary Guarantor under
Section 10.01 of the Indenture, the Company shall, as soon as
practicable, cause such subsidiary to become a party hereto and by
becoming a party hereto such subsidiary shall make the warranties,
agreements, representations and covenants to the holders of the Transfer
Restricted Securities as those of the Company herein.




Survival. The respective indemnities, agreements, representations,
warranties and each other provision set forth in this Exchange and
Registration Rights Agreement or made pursuant hereto shall remain in
full force and effect regardless of any investigation (or statement as to
the results thereof) made by or on behalf of any holder of Transfer
Restricted Securities, any director, officer or partner of such holder,
any agent or underwriter or any director, officer or partner thereof, or
any controlling person of any of the foregoing, and shall survive
delivery of and payment for the Transfer Restricted Securities pursuant
to the Purchase Agreement and the transfer and registration of Transfer
Restricted Securities by such holder and the consummation of an Exchange
Offer.




(f) Governing Law. This Exchange and Registration Rights Agreement shall
be governed by and construed in accordance with the laws of the State of
New York.




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




(h) Entire Agreement; Amendments. This Exchange and Registration Rights
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 Exchange and Registration Rights
Agreement supersedes all prior agreements and understandings between the
parties with respect to its subject matter. This Exchange and
Registration Rights Agreement may be amended and the observance of any
term of this Exchange and Registration Rights 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 Transfer Restricted Securities at the time outstanding. Each holder
of any Transfer Restricted 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 Transfer Restricted
Securities or is delivered to such holder.



26









 






(i) Inspection. For so long as this Exchange and Registration Rights
Agreement shall be in effect, this Exchange and Registration Rights
Agreement and a complete list of the names and addresses of all the
holders of Transfer Restricted Securities shall be made available for
inspection and copying on any business day by any holder of Transfer
Restricted Securities for proper purposes only (which shall include any
purpose related to the rights of the holders of Transfer Restricted
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)
above 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) Service of Process. The Company irrevocably (i) agrees that any
legal suit, action or proceeding against the Company brought by any
holder, Purchaser, agent or underwriter or by any person who controls any
holder, agent or underwriter arising out of or based upon this Exchange
and Registration Rights Agreement or the transactions contemplated hereby
may be instituted in any Federal or state court located in the Borough of
Manhattan in the City of New York in the State of New York (“New York
Court”), (ii) waives, to the fullest extent each party may effectively do
so, any objection which such party may now or hereafter have to the
laying of venue of any such proceeding and (iii) submits to the
non-exclusive jurisdiction of such courts in any such suit, action or
proceeding. The Company has appointed CT Corporation Systems, 111-Eighth
Avenue, New York, New York, 10011, as its authorized agent (the
“Authorized Agent”) upon whom process may be served in any such action
arising out of or based on this Exchange and Registration Rights
Agreement or the transactions contemplated hereby which may be instituted
in any New York Court by any holder, agent or underwriter or by any
person who controls any holder, agent or underwriter, expressly consents
to the jurisdiction of any such court in respect of any such action, and
waives any other requirements of or objections to personal jurisdiction
with respect thereto. Such appointments shall be irrevocable. The
Company represents and warrants that the Authorized Agent has agreed to
act as such agent for service of process and agrees to take any and all
action, including the filing of any and all documents and instruments,
that may be necessary to continue such appointment in full force and
effect as aforesaid. Service of process upon the Authorized Agent and
written notice of such service to the Company shall be deemed, in every
respect, effective service of process upon the Company.




(l) Judgment Currency. In respect of any judgment or order given or made
for any amount due hereunder that is expressed and paid in a currency
(the “judgment currency”) other than United States dollars, the Company
shall indemnify each holder, agent or underwriter against any loss
incurred by such holder, agent or underwriter as a result of any
variation as between (i) the rate of exchange at which the United States
dollar amount is converted into the judgment currency for the purpose of
such judgment or order and (ii) the rate of exchange at which a holder,
agent or underwriter is able to purchase United States dollars with the
amount of judgment currency actually received by such holder, agent or
underwriter. The foregoing indemnity shall constitute a separate and
independent obligation of the Company and shall continue in full force
and effect notwithstanding any such judgment or order as aforesaid. The
term “rate of exchange”



27









 




shall include any premiums and costs of exchange payable in connection with the
purchase of or conversion into United States dollars.




28









 







If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be submitted to the Company for examination
upon request, but without warranty on your part as to the authority of the
signers thereof




	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	

	 	 	 	AINSWORTH LUMBER CO. LTD.
	 
	 	 	 	 
	

	 	By:
	 	Catherine Ainsworth
	

	 	 	 	
 
	

	 	 	 	Name: Catherine Ainsworth
	

	 	 	 	Title: Chief Operating Officer & Secretary







Ainsworth Lumber Co. Ltd.



Exchange and Registration Rights Agreement



Accepted as of the date hereof:



Goldman, Sachs & Co.

Deutsche Bank Securities, Inc.



	 	 	 	 	 
	By:

	 	/s/ Authorized Officer
	 	 
	

	 	
 	 	 
	

	 	(Goldman, Sachs & Co.)	 	 







On behalf of each of the Purchasers



 









 





Exhibit A



AINSWORTH LUMBER CO. LTD.




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 Ainsworth Lumber Co. Ltd. (the
“Company”) 6.750% Senior Notes due March 15, 2014 (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 Ainsworth
Lumber Co. Ltd., Suite 3194 Bentall IV, PO Box 49307, 1055 Dunsmuir Street,
Vancouver, British Columbia, Canada, V7X 1L3, telephone: (604) 661-3200.












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




1









 










Ainsworth Lumber Co. Ltd.




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”) between Ainsworth Lumber Co. Ltd.
(the “Company”), and the Purchasers named therein. Pursuant to the Exchange
and Registration Rights Agreement, the Company has filed with the United States
Securities and Exchange Commission (the “Commission”) a registration statement
on Form F-4 (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 6.750% Senior Notes due March 15, 2014 (the
“Securities”). A copy of the Exchange and Registration Rights Agreement is
attached hereto. All capitalized terms not otherwise defined herein shall have
the meanings ascribed thereto in the Exchange and Registration Rights
Agreement.



Each beneficial owner of Transfer Restricted Securities (as defined below) is
entitled to have the Transfer Restricted Securities beneficially owned by it
included in the Shelf Registration Statement. In order to have Transfer
Restricted 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 Transfer Restricted Securities who do not
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 Transfer Restricted 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 Transfer Restricted 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 “Transfer Restricted Securities” is defined in the Exchange and
Registration Rights Agreement.




1









 








ELECTION



The undersigned holder (the “Selling Securityholder”) of Transfer Restricted
Securities hereby elects to include in the Shelf Registration Statement the
Transfer Restricted 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 Transfer Restricted
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.



Upon any sale of Transfer Restricted 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:




QUESTIONNAIRE






	(1)	 	(a) Full Legal Name of Selling Securityholder:












	(a)	 	Full Legal Name of Registered Holder (if not the same as
in (a) above) of Transfer Restricted Securities Listed in Item
(3) below:












	(b)	 	Full Legal Name of DTC Participant (if applicable and if
not the same as (b) above) Through Which Transfer Restricted
Securities Listed in Item (3) below are Held:












	(2)	 	Address for Notices to Selling Securityholder:





	 	 	 
	 
	 	 
	

	 	
 
	 
	 	 
	

	 	
 
	 
	 	 
	

	 	
 
	Telephone:
	 	 
	

	 	
 
	Fax:
	 	 
	

	 	
 







1









 






	 	 	 
	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 Transfer Restricted Securities
beneficially owned:                                                                             







	 	 	CUSIP No(s). of such Transfer Restricted Securities:
                                                                            







	(b)	 	Principal amount of Securities other than Transfer Restricted
Securities beneficially owned:                                                                             







	 	 	CUSIP No(s). of such other Securities:                                                                             







	(c)	 	Principal amount of Transfer Restricted Securities which the
undersigned wishes to be included in the Shelf Registration
Statement:                                                                             







	 	 	CUSIP No(s). of such Transfer Restricted 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:







	(5)	 	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:







	(6)	 	Plan of Distribution:





2









 







	 	 	Except as set forth below, the undersigned Selling Securityholder intends
to distribute the Transfer Restricted Securities listed above in Item (3)
only as follows (if at all): Such Transfer Restricted Securities may be
sold from time to time directly by the undersigned Selling Securityholder
or, alternatively, through underwriters, broker-dealers or agents. Such
Transfer Restricted 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 Transfer Restricted Securities or otherwise, the Selling
Securityholder may enter into hedging transactions with broker-dealers,
which may in turn engage in short sales of the Transfer Restricted
Securities in the course of hedging the positions they assume. The
Selling Securityholder may also sell Transfer Restricted Securities short
and deliver Transfer Restricted Securities to close out such short
positions, or loan or pledge Transfer Restricted Securities to
broker-dealers that in turn may sell such securities.
	 
	 	 	State any exceptions here:




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 and the rules and regulations thereunder, particularly
Regulation M.



In the event that the Selling Securityholder transfers all or any portion of
the Transfer Restricted 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 (6) 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. 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:
	 	 







3









 






	 	 	 
	

	 	
 
	

	 	
 
	

	 	
 
	

	 	
 
	

	 	
 
	(ii) With a copy to:
	 	 
	

	 	
 
	

	 	
 
	

	 	
 
	

	 	
 
	

	 	
 






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 Transfer Restricted
Securities beneficially owned by such Selling Securityholder and listed in Item
(3) above). This Agreement shall be governed in all respects by the laws of
the State of New York.




4









 







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 Transfer
Restricted 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:



































 









 








Exhibit B



NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT




The Bank of New York

Ainsworth Lumber Co. Ltd.

c/o The Bank of New York

101 Barclay Street, Floor 21W

New York, NY 10286



	 	 	 
	Attention:
	 	 
	 
	 	 
	Re:

	 	Ainsworth Lumber Co. Ltd. (the “Company”)
	

	 	6.750% Senior Notes due March 15, 2014







Dear Sirs:


Please be advised that                               has transferred $                   aggregate principal amount of the
above-referenced Notes pursuant to an effective Registration Statement on Form
F-4 (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 [•, 2003] 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)