CREDIT AGREEMENT dated as of May 22, 2009 among CANWEST MEDIA INC. as Borrower THE GUARANTORS FROM TIME TO TIME PARTIES HERETO as Guarantors and THE LENDERS FROM TIME TO TIME PARTIES HERETO as Lenders and CIT BUSINESS CREDIT CANADA INC. as Agent

Redacted Version

CREDIT AGREEMENT

dated as of

May 22, 2009

among

CANWEST MEDIA INC.

as Borrower

THE GUARANTORS FROM TIME TO TIME PARTIES HERETO

as Guarantors

and

THE LENDERS FROM TIME TO TIME PARTIES HERETO

as Lenders

and

CIT BUSINESS CREDIT CANADA INC.

as Agent

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CREDIT AGREEMENT

THIS CREDIT AGREEMENT is dated as of May 22, 2009 and is entered into among Canwest Media Inc, as Borrower, the Guarantors from time to time parties hereto, as Guarantors, the Lenders from time to time parties hereto, as Lenders, and CIT Business Credit Canada Inc., as Agent.

RECITALS

A. The Credit Parties require new financing to assist with the refinancing of certain indebtedness in favour of its existing senior secured lenders under the BNS Credit Agreement and for working capital purposes and have requested that the Lenders provide to the Borrower the credit facilities contemplated herein.

B. The Guarantors have agreed to guarantee the obligations of the Borrower in connection herewith, and the Credit Parties have agreed to grant Liens over their assets on the basis contemplated in Section 2.20 of this Agreement.

C. In light of the financial condition of the Credit Parties, the Credit Parties may seek a compromise and arrangement with their creditors under the CCAA.

D. The Lenders have advised the Credit Parties that they would only provide the credit facilities contemplated herein if, in connection with any CCAA Proceedings, the Initial Order provides for matters substantially as set forth in section 2.19 of this Agreement, and the Credit Parties have so agreed.

NOW THEREFORE, in consideration of the mutual conditions and agreements set forth in this Agreement and for good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Defined Terms. As used in this Agreement, the following terms have the meanings specified below:

“Accounts” means, in respect of each Credit Party, all of such Credit Party’s now existing and future: (a) accounts (as defined in the PPSA), and any and all other receivables (whether or not specifically listed on schedules furnished to the Agent), including all accounts created by, or arising from, all of such Credit Party’s sales, leases, loans, rentals of goods or renditions of services to its customers, including those accounts arising under any of such Credit Party’s trade names or styles, or through any of such Credit Party’s divisions; (b) any and all instruments, documents, bills of exchange, notes or any other writing that evidences a monetary obligation and chattel paper (including electronic chattel paper) (all as defined in the PPSA); (c) unpaid seller’s or lessor’s rights (including rescission, replevin, reclamation, repossession and stoppage in transit) relating to the foregoing or arising therefrom; (d) rights to any goods

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represented by any of the foregoing, including rights to returned, reclaimed or repossessed goods; (e) reserves and credit balances arising in connection with or pursuant hereto; (f) guarantees, indemnification rights, supporting obligations, payment intangibles, tax refunds and letter of credit rights; (g) insurance policies or rights relating to any of the foregoing; (h) intangibles pertaining to any and all of the foregoing (including all rights to payment, including those arising in connection with bank and non-bank credit cards), and including books and records and any electronic media and software relating thereto; (i) notes, deposits or property of borrowers or other account debtors securing the obligations of any such borrowers or other account debtors to such Credit Party; (j) cash and non cash proceeds (as defined in the PPSA) of any and all of the foregoing; and (k) all monies and claims for monies now or hereafter due and payable in connection with any and all of the foregoing or otherwise.

“Acquisition” means any transaction, or any series of related transactions, consummated after the Effective Date, by which any Credit Party, directly or indirectly, by means of a take-over bid, tender offer, amalgamation, merger, purchase of assets or otherwise (a) acquires any business or all or substantially all of the assets of any Person engaged in any business, (b) acquires control of securities of a Person engaged in a business representing more than 50% of the ordinary voting power for the election of directors or other governing position if the business affairs of such Person are managed by a board of directors or other governing body, (c) acquires control of more than 50% of the ownership interest in any Person engaged in any business that is not managed by a board of directors or other governing body, or (d) otherwise acquires Control of a Person engaged in a business.

“Action Request” means any request received by any Credit Party from any Governmental Authority under any Environmental Law whereby such Governmental Authority requests that it take action or steps or do acts or things in respect of any property or assets in the charge, management or control of such Credit Party to remediate a matter which is not or is alleged not to be in compliance with all Environmental Laws.

“Administrative Charge” shall have the meaning given such term in Section 2.19.

“Administrative Questionnaire” means an administrative questionnaire in a form supplied by the Agent.

“Affiliate” means, (a) any Person which, directly or indirectly, Controls, is Controlled by or is under common Control with any other Person; (b) any Person which beneficially owns or holds, directly or indirectly, 10% or more of any class of voting stock or equity interest (including partnership interests) of any other Person; (c) any Person, 10% or more of any class of the voting stock (or if such Person is not a corporation, 10% or more of the equity interest, including partnership interests) of which is beneficially owned or held, directly or indirectly, by any other Person; or (d) any Person related within the meaning of the ITA to any such Person and includes any “Affiliate” within the meaning specified in the Canada Business Corporations Act on the date hereof. The term control (including the terms “controlled by” and “under common control with”), means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of the Person in question.

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“Agent” means CIT Business Credit Canada Inc., in its capacity as Agent for the Lenders hereunder, or any successor Agent appointed pursuant to Section 8.9.

“Agreement” means this credit agreement and the schedules and exhibits hereto and any amendments, restatements, supplements or other modifications to this credit agreement or the schedules or exhibits made at any time and from time to time.

“Applicable Law” means all federal, provincial, municipal, foreign and international statutes, acts, codes, ordinances, decrees, treaties, rules, regulations, municipal by-laws, judicial or arbitral or administrative or ministerial or departmental or regulatory judgments, orders, decisions, rulings or awards or any provisions of the foregoing, including general principles of common and civil law and equity, and all policies, practices and guidelines of any Governmental Authority binding on or affecting the Person referred to in the context in which such word is used (including, in the case of tax matters, any accepted practice or application or official interpretation of any relevant taxation authority).

“Applicable Margin” means, with respect to any Loan, 6% rate per annum.

“Applicable Percentage” means with respect to any Lender, the percentage of the total Commitments represented by such Lender’s Commitment. If any Commitments have terminated or expired, the Applicable Percentages in respect of the terminated or expired Commitments shall be determined based upon the relevant Commitments most recently in effect (i.e., immediately prior to their termination or expiry), giving effect to any assignments.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.4), and accepted by the Agent, in the form of Exhibit I or any other form approved by the Agent.

“Authorization” means, with respect to any Person, any authorization, order, permit, approval, grant, licence, consent, right, franchise, privilege, certificate, judgment, writ, injunction, award, determination, direction, decree, by-law, rule or regulation of any Governmental Authority having jurisdiction over such Person, whether or not having the force of law.

“Authorization and Direction” means the authorization and direction dated as of May 21, 2009 made in favour of the Collateral Agent by The Bank of Nova Scotia, in its capacity as agent of the existing Secured Creditors under and as defined in the Collateral Agency Agreement.

“Availability Block” means $15,000,000 at all times.

“Availability Reserves” means, as of any date of determination, the Availability Block and, without duplication, such other amounts as the Agent may from time to time establish and revise in its sole discretion reducing the Borrowing Base which would otherwise be available to the Borrower under the lending formulas provided for herein (a) to reflect criteria, events, conditions, contingencies or risks which, as determined by the Agent in its sole discretion, do or may affect either (i) any component of the Borrowing Base or its value, (ii) the assets, business,

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operations, industry, financial performance, financial condition or prospects of the Credit Parties, or (iii) the security interests and other rights of the Agent in the Collateral (including the enforceability, perfection and priority thereof), or (b) to reflect the Agent’s reasonable belief that any collateral report or financial information furnished by or on behalf of the Borrower to the Agent is or may have been incomplete, inaccurate or misleading, or (c) in respect of any state of facts which the Agent determines constitutes a Default or an Event of Default. Without limiting the foregoing, the Agent, in its sole discretion, may establish and/or increase Availability Reserves in respect of: (a) (i) three months’ rental payments or similar charges for any of the Borrower’s leased premises or other collateral locations for which the Borrower has not delivered to the Agent a landlord’s waiver or bailee’s letter substantially in the form attached hereto as Exhibits G and H, respectively, plus (ii) any other fees or charges owing by the Borrower to any applicable warehousemen or third party processor (all as determined by the Agent in its reasonable business judgement); (b) any reserve established by the Agent on account of statutory claims, deemed trusts, or inventory subject to rights of suppliers under Section 81.1 of the BIA (generally known as the “30-day goods” rule); (c) liabilities of any Credit Party under any Blocked Account Agreement, (d) employee or employee benefit related liabilities and any other claims which may have priority over the claims of the Agent and the Lenders, including Priority Payables and potential claims under the Wage Earners’ Protection Program Act (Canada); (e) the Administrative Charge; and (f) such other reserves as the Agent may at any time or times deem necessary in its reasonable judgment as a result of (x) negative forecasts and/or trends in the Borrower’s business, operations, industry, prospects, profits, operations or financial condition or assets or (y) other issues, circumstances or facts that could otherwise negatively impact the Borrower, its business, operations, industry, prospects, profits, operations or financial condition or assets.

“Base Rate” means, on any day, the annual rate of interest equal to the greater of (i) the annual rate of interest announced from time to time by CIBC and in effect as its base rate at its principal office in Toronto, Ontario on such day for determining interest rates on U.S. Dollar-denominated commercial loans made in Canada, (ii) the Federal Funds Effective Rate plus 1.00%, and (iii) 2.25%. The Base Rate is a rate set by CIBC based upon various factors including CIBC’s cost and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans; however, CIBC may price loans at, above or below such announced rate.

“Base Rate Borrowing” means a Borrowing comprised of one or more Base Rate Loans.

“Base Rate Loan” means a Loan denominated in U.S. Dollars made by the Lenders to the Borrower hereunder pursuant to a drawdown, rollover or conversion of a Loan on which interest is payable upon the Base Rate.

“BIA” means the Bankruptcy and Insolvency Act (Canada), as amended from time to time (or any successor statute).

“Blocked Account Agreement” has the meaning set out in Section 2.17(c).

“Blocked Accounts” has the meaning set out in Section 2.17(c).

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“BNS Credit Agreement” means the credit agreement dated as of October 13, 2005 among the Borrower, the Guarantors parties thereto, the lenders parties thereto and The Bank of Nova Scotia, as administrative agent, the lenders from time to time party thereto as lenders, as amended by a First Amendment Agreement dated as of February 15, 2006, a Second Amendment Agreement dated as of April 30, 2007, a Third Amendment Agreement dated as of July 31, 2007, and a Fourth Amendment Agreement dated as of November 4, 2008.

“BNS Priority Collateral” [redacted]. [Canwest has redacted the description of the BNS Priority Collateral, which is confidential.]

“Borrower” means Canwest Media Inc., a CBCA corporation.

“Borrowing” means any availment of the Credit, which includes a Loan and the issuance of a Letter of Credit Guarantee in accordance with Section 2.18, and a Borrowing includes a conversion of any outstanding Loan and the provision of any Loan as required for the Agent to honour any obligations pursuant to any Letter of Credit Guarantee.

“Borrowing Base” means, at any time, an amount (which may not be less than zero) equal to the sum of (i) 85% of the aggregate amount of all Eligible Accounts, plus (ii) the lesser of (x) up to 60% of the Fair Market Value of Eligible Real Property or (y) $40,000,000, plus (iii) the lesser of (x) up to 80% of the Net Orderly Liquidation Value of Eligible Equipment or (y) $30,000,000, minus (iv) an amount equal to all Priority Payables, and minus (v) without duplication, an amount equal to all aggregate Availability Reserves; provided that, at all times, the aggregate amount contributed pursuant to subparagraphs (ii) and (iii) above shall not exceed an amount equal to $40,000,000. For greater certainty, if any Credit Party sells or otherwise disposes of any Eligible Real Property or Eligible Equipment, the amount (if any) previously included in the Borrowing Base on account thereof shall be removed from the Borrowing Base.

“Borrowing Base Report” means the report of the Borrower concerning the amount of the Borrowing Base, to be delivered pursuant to Section 5.1, substantially in the form attached as Exhibit A.

“Borrowing Request” means a request by the Borrower for a Borrowing substantially in the form of Exhibit B.

“Broadcast Permits” is defined in Section 3.30(iii).

“Business Day” means any day that is not (i) a Saturday, Sunday or other day on which commercial banks in Toronto, Ontario are authorized or required by Applicable Law to remain closed, and (ii) in the case of any U.S. Dollar-denominated Borrowing, any other day on which commercial banks in New York, New York are authorized or required by Applicable Law to remain closed, and (iii) in the case of any LIBO Rate Loan any other day on which commercial banks in London, England are authorized or required by Applicable Law to remain closed.

“Canadian Dollars”, “Dollars”, “Cdn.$” and “$” refer to lawful money of Canada.

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“Canadian $ Equivalent” means, on any day, the amount of Canadian Dollars that the Agent could purchase, in accordance with its normal practice, with a specified amount of U.S. Dollars based on the spot rate at which Canadian Dollars are offered at the start of such day by CIBC in Toronto, Ontario.

“Canadian Prime Borrowing” means a Borrowing comprised of one or more Canadian Prime Loans.

“Canadian Prime Loan” means a Loan denominated in Canadian Dollars made by the Lenders to the Borrower hereunder pursuant to a drawdown, rollover or conversion of a Loan which bears interest at a rate based upon the Canadian Prime Rate.

“Canadian Prime Rate” means the greater of (i) the rate of interest publicly announced from time to time by CIBC as its reference rate of interest for loans made in Canadian Dollars to Canadian customers and designated as its “prime” rate, and (ii) 2.25%. It is a rate set by CIBC based upon various factors including CIBC’s costs and desired return, general economic conditions and other factors and is used as a reference point for pricing some loans. However, CIBC may price loans at, above or below such announced rate.

“Capital Expenditures” means all payments due or accruing due (whether or not paid) during a Fiscal Year in respect of the cost (including expenditures on materials, contract labour and direct labour, but excluding expenditures properly chargeable to repairs and maintenance in accordance with GAAP) of any fixed asset or improvement, or replacement, substitution, or addition thereto, which have a useful life of more than one (1) year, including, without limitation, those arising in connection with the direct or indirect acquisition of such assets by way of increased product or service charges or offset items or in connection with Capital Leases.

“Capital Lease” means any lease of Property that, in accordance with GAAP, is required to be capitalized on the consolidated balance sheet of the Credit Parties.

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as Capital Leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

“CCAA” means the Companies’ Creditors Arrangement Act (Canada) as amended from time to time (or any successor statute).

“CCAA Orders” means, collectively, the Initial Order and all other orders issued or to be issued by the Ontario Superior Court of Justice in connection with the CCAA Proceedings.

“CCAA Proceedings” means any proceedings commenced by the Credit Parties under the CCAA, under which the Credit Parties may seek an arrangement and compromise with certain of its creditors.

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“CDOR Rate” means, on any day and for any period, an annual rate of interest equal to the average rate applicable to Canadian Dollar bankers’ acceptances for the applicable period appearing on the “Reuters Screen CDOR Page” (as defined in the International Swaps and Derivatives Association, Inc. 2000 definitions, as modified and amended from time to time), rounded to the nearest 1/100th of 1% (with .005% being rounded up), at approximately 10:00 a.m., Toronto time, on such day, or if such day is not a Business Day, then on the immediately preceding Business Day, provided that if such rate does not appear on the Reuters Screen CDOR Page on such day as contemplated, then the CDOR Rate on such day shall be calculated as the rate for such period applicable to Canadian Dollar bankers’ acceptances quoted by CIBC as of 10:00 a.m., Toronto time, on such day or, if such day is not a Business Day, then on the immediately preceding Business Day.

“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group of Persons acting jointly or otherwise in concert, other than the Permitted Holders, of Equity Securities representing more than 50% of the aggregate ordinary voting power represented by the issued and outstanding Equity Securities of the Borrower; (b) the occupation of a majority of the seats (other than vacant seats) on the board of directors of the Borrower by Persons who were neither (i) nominated by the board of directors of the Borrower nor (ii) appointed by directors so nominated; or (c) the acquisition of direct or indirect Control of the Borrower by any Person or group of Persons acting jointly or otherwise in concert, other than the Permitted Holders.

“Change in Law” means (i) the adoption of any new Applicable Law after the date of this Agreement, (ii) any change in any existing Applicable Law or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement, or (iii) compliance by any Lender or the Issuing Bank (or, for purposes of Section 2.12(b), by any lending office of such Lender or Issuing Bank or by such Lender’s or such Issuing Bank’s holding company, if any) with any request, guideline or directive (whether or not having the force of law, but in the case of a request, guideline or directive not having the force of law, being a request, guideline or directive with which persons customarily comply) of any Governmental Authority made or issued after the date of this Agreement.

“Chapter 15 Entities” means Canwest Global Communications Corp., the Borrower, 4501063 Canada Inc., Canwest Television GP Inc., and Canwest Global Broadcasting Inc./Radiodiffusion Canwest Global Inc.

“CIBC” means Canadian Imperial Bank of Commerce and its successors.

“CIT Priority Collateral” [redacted]. [Canwest has redacted the description of the CIT Priority Collateral, which is confidential.]

“Collateral” means the property described in and subject to the Liens, privileges, priorities and security interests purported to be created by any Security Document.

“Collateral Agency Agreement” means the Intercreditor and Collateral Agency Agreement dated as of October 13, 2005 among the Borrower, the Guarantors, the Collateral Agent and the Persons who are, and from time to time become, parties to such agreement as

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Secured Creditors (as defined therein), as amended by the Credit Confirmation and Amending Agreement.

“Collateral Agent” means CIBC Mellon Trust Company, in its capacity as Collateral Agent under the Collateral Agency Agreement.

“Collateral Management Fee” has the meaning ascribed thereto in the Commitment Letter.

“Commitment” means, with respect to each Lender, the commitment(s) of such Lender to make Loans hereunder as such commitment may be reduced from time to time pursuant to Sections 2.6 and/or 2.9, and as such commitments may be reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.4. The initial amount(s) of each Lender’s Commitment(s) are set forth on Schedule A, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Commitment(s), as applicable. The initial aggregate amount of the Commitments is Cdn.$75,000,000. Subject to Section 4.2, on the Restructuring Event Date, the aggregate amount of the Commitments shall be increased to Cdn.$100,000,000.

“Commitment Letter” means the letter dated May 20, 2009 between the Borrower and the Agent providing for, among other things, the payment by the Borrower of certain fees.

“Control” means, in respect of a particular Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Court” means the Ontario Superior Court of Justice Commercial List.

“Cover” means, at any time on or after the Maturity Date, an amount equal to 105% of the aggregate amount of Letter of Credit Exposure at such time and such amount shall be paid by the Borrower to the Agent and retained by the Agent in a collateral account maintained by the Agent at its Payment Office and collaterally assigned to the Agent as security until such time as the applicable Letters of Credit shall have expired or matured and Reimbursement Obligations, if any, with respect thereto shall have been fully satisfied; provided that if any such Reimbursement Obligations are not satisfied when due hereunder, the Agent may apply any or all amounts in such collateral account in satisfaction of any or all such Reimbursement Obligations.

“Credit Confirmation and Amending Agreement” means the credit confirmation and amending agreement dated as of the date hereof among the Credit Parties, the Collateral Agent, the holders of the New Notes, The Bank of Nova Scotia and CIT, as agent of the lenders under this Agreement.

“Credit Party” means the Borrower and each Guarantor.

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“Credit” means the revolving credit facility established pursuant to the Commitments of the Lenders.

“Default” means any event or condition which constitutes an Event of Default or which, upon notice, lapse of time or both, would, unless cured or waived, become an Event of Default.

“DIP Charge” shall have the meaning set forth in Section 2.19.

“Directors’ Charge” means any charge provided for in the Initial Order to secure the Directors’ Charge Expenses, which charge shall be junior and subordinate to the DIP Charge and otherwise in form and substance satisfactory to the Agent.

“Directors’ Charge Expenses” means those disbursements, expenses, liabilities and fees of the directors and officers of the debtors under the CCAA Proceedings.

“Disclosed Matters” means the actions, suits and proceedings and the environmental matters disclosed in Schedule B.

“EDC ” means Export Development Corporation Canada and its successors and assigns.

“Effective Date” means the date on which all of the conditions specified in Section 4.1 are satisfied or waived in accordance with Section 9.2, as confirmed by the making of the first Loans under this Agreement.

“Eligible Account” means, at any time, the invoice amount (which shall be the Canadian $ Equivalent at such time of any amount denominated in U.S.$) owing on each Account of a Credit Party (net of any credit balance, returns, trade discounts, contras, unapplied cash, unbilled amounts, tax refunds that have not yet been received or retention or finance charges or any other dilutive factors) which meet such standards of eligibility as the Agent shall establish from time to time in its sole and absolute discretion; provided that, in any event, no account shall be deemed an Eligible Account unless each of the following statements is accurate and complete (and by including such Account in any computation of the applicable Borrowing Base, the Borrower shall be deemed to represent and warrant to the Agent, each Issuing Bank and the Lenders the accuracy and completeness of such statements and the compliance of each such Account with each such other eligibility standard established by the Agent):

(1) Such Account is a binding and valid obligation of the obligor thereon and is in full force and effect;

(2) Such Account is evidenced by an invoice and is payable in either Canadian Dollars or U.S. Dollars;

(3) Such Account is genuine as appearing on its face or as represented in the books and records of the Borrower and the applicable Credit Party;

(4) Such Account is free from claims regarding rescission, cancellation or avoidance, whether by operation of Applicable Law or otherwise;

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(5) Payment of such Account is less than 90 days past the original invoice date thereof and less than 60 days past the original due date thereof; notwithstanding the foregoing, Accounts which are more than 90 days past the original invoice date thereof but less than 120 days past the original invoice date thereof, and which otherwise meet the criteria set forth in this definition of “Eligible Account”, shall be Eligible Accounts subject to an aggregate maximum of $10,000,000;

(6) Such Account is net of concessions, offset, deduction, contras, returns, chargebacks or understandings with the obligor thereon that in any way could reasonably be expected to adversely affect the payment of, or the amount of, such Account;

(7) The Agent on behalf of the Lenders, has a first-priority perfected Lien covering such Account and such Account is, and at all times will be, free and clear of all other Liens other than Priority Payables which are Permitted Liens;

(8) The obligor on such Account is not an Affiliate, employee, officer, director, agent, holder of more than 2% of the issued and outstanding capital stock of the Parent or any stockholder of any other Credit Party;

(9) Such Account arose in the ordinary course of business of the Credit Party out of the sale of goods or services by the Credit Party;

(10) Such Account is not payable by an obligor in respect of which 50% or more (by amount) of the total aggregate Accounts owed to the Credit Party by such obligor or any of its Affiliates are more than 90 days past the original invoice date thereof or more than 60 days past the original due date thereof;

(11) All consents, licenses, approvals or authorizations of, or registrations or declarations with, any Governmental Authority required to be obtained, effected or given in connection with the execution, delivery and performance of such Account by each party obligated thereunder, or in connection with the enforcement and collection thereof by the Agent, have been duly obtained, effected or given and are in full force and effect;

(12) The obligor on such Account is not an individual, and is not the subject of any bankruptcy or insolvency proceeding, does not have a trustee or receiver appointed for all or a substantial part of its property, has not made an assignment for the benefit of creditors, admitted its inability to pay its debts as they mature, suspended its business or initiated negotiations regarding a compromise of its debt with its creditors, and the Agent, in its reasonable discretion, is otherwise satisfied with the credit standing of such obligor;

(13) The chief executive office of the obligor of such Account is located in the United States of America or Canada and the obligor of such Account is organized and existing under the laws of the United States of America or a state thereof or the federal laws of Canada, a province or territory thereof, or if the obligor is not so organized and existing, such Account is covered under letters of credit or export/import insurance provided by EDC (or such other provider of letters of credit or import/export insurance as shall be agreed to in writing by the Agent and with

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security provided to the Agent in respect thereof (all to the satisfaction of the Agent) on terms and in a manner satisfactory to the Agent;

(14) The obligor of such Account is not a Governmental Authority, if the enforceability or effectiveness against such Governmental Authority of an assignment of such Account is subject to any precondition which has not been fulfilled;

(15) In respect of an Account arising from the sale of goods, the subject goods have been completed, sold and shipped, on a true sale basis on open account, or subject to contract, and not on consignment, on approval, on a “sale or return” basis, or on a “xxxx and hold” or “pre-sale” basis or subject to any other repurchase or return agreement; no material part of the subject goods has been returned, rejected, lost or damaged; and such Account is not evidenced by chattel paper or a promissory note or an instrument of any kind, unless such chattel paper, promissory note or other instrument has been delivered to the Agent and is subject to a Lien under the Security Documents;

(16) Each of the representations and warranties set forth herein and in the Loan Documents with respect to such Account is true and correct on such date;

(17) A cheque, promissory note, draft, trade acceptance or other instrument has not been received with respect to such Account (or with respect to any other account due from the same account debtor), presented for payment and returned uncollected for any reason;

(18) Such Account is not in respect of a volume rebate;

(19) Such Account is not a pre-billed account or an account arising from progress billing;

(20) The assignment (whether absolutely or by way of security) of such Account is not limited or restricted by the terms of the contract evidencing or relating to such Account or, if assignment of such Account is so restricted, such limitation or restriction has been complied with and the laws of the jurisdiction(s) governing the validity of such assignment do not provide that such limitation or restriction is ineffective as against the secured creditor with a security interest therein; and

(21) Such Account is not an Account which the Agent, in the exercise of its good faith credit discretion, has determined to be ineligible for any other reason, including the Agent’s determination that the prospect of the collection of such Account is impaired or that the Account may not be paid because of the account debtor’s inability to pay or any other reason as may be customary either in the commercial lending industry or in the lending practices of the Agent.

provided that, if at any time the aggregate amount of all Eligible Accounts owed to a Credit Party by a particular obligor or its Affiliates exceeds 10% of the aggregate amount of all Eligible Accounts at such time owed to such Credit Party (determined without giving effect to any reduction in Eligible Accounts pursuant to this proviso), then, unless the Accounts of such obligors and its Affiliates are insured pursuant to credit insurance acceptable to the Agent which has been assigned to the Agent in form acceptable to the Agent, the amount of such Accounts in

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excess of 10% of such aggregate amount of all Eligible Accounts shall be excluded in determining the aggregate amount of all Eligible Accounts at such time.

“Eligible Equipment” means the equipment owned by a Credit Party located in Canada at the Credit Parties’ facilities described on Schedule 3.28, as updated from time to time with the consent of the Agent, and meeting each of the following requirements:

(a) such Credit Party has good title to such equipment;

(b) such Credit Party has the right to subject such equipment to a Lien in favor of the Collateral Agent; such equipment is subject to a first priority perfected Lien in favor of the Collateral Agent and is free and clear of all other Liens of any nature whatsoever (except for (i) Permitted Liens which do not have priority over the Lien in favor of the Collateral Agent, (ii) unregistered Liens in respect of Priority Payables that are not yet due and payable, and (iii) after the Restructuring Event Date, the Administrative Charge;

(d) such equipment is located on premises (i) owned by such Credit Party, which premises are subject to a first priority perfected Lien in favor of the Collateral Agent, or (ii) leased by such Credit Party where (x) the lessor has delivered to the Agent a landlord lien waiver or (y) an Availability Reserve for rent, charges, and other amounts due or to become due with respect to such facility has been established by the Agent in its sole discretion;

(e) such equipment is in good working order and condition (ordinary wear and tear excepted) and is used or held for use by such Credit Party in the ordinary course of business of the Credit Party;

(f) such equipment is not subject to any agreement which restricts the ability of such Credit Party to use, sell, transport or dispose of such equipment or which restricts the Collateral Agent's ability to take possession of, sell or otherwise dispose of such equipment;

(g) in respect of which an appraisal report has been delivered to the Agent in form, scope and substance satisfactory to the Agent; and

(h) such equipment does not constitute “fixtures” under the Applicable Laws of the jurisdiction in which such equipment is located.

“Eligible Real Property” means the real property (including fixtures thereto) located in Canada listed on Schedule 3.28 and identified as such thereon as updated from time to time with the consent of the Agent, owned by a Credit Party (i) that is acceptable in the sole and absolute discretion of the Agent for inclusion in the Borrowing Base, (ii) in respect of which an appraisal report has been delivered to the Agent in form, scope and substance satisfactory to the Agent, (iii) in respect of which the Agent is satisfied that all actions necessary or desirable in order to create in favour of the Collateral Agent a perfected first priority Lien (subject only to Permitted Liens and, after the Restructuring Event Date, the Administrative Charge and an unregistered Lien in respect of Priority Payables that are not yet due and payable) on such real property have

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been taken, including the filing and recording of Security Documents, (iv) in respect of which an environmental assessment report has been completed and delivered to the Agent in form and substance satisfactory to such Agent and which does not indicate any material environmental liability, or material non-compliance with any Environmental Law (which liability or non-compliance was not previously disclosed to the Agent), (v) which is adequately protected by fully-paid valid title insurance with endorsements and in amounts reasonably acceptable to the Agent, insuring that the Collateral Agent shall have a perfected first priority Lien (subject only to Permitted Liens and, after the Restructuring Event Date, the Administrative Charge and an unregistered Lien in respect of Priority Payables that are not yet due and payable) on such real property, evidence of which shall have been provided in form and substance reasonably satisfactory to the Agent, and (vi) if required by the Agent: (A) a survey has been delivered for which all necessary fees have been paid and which is dated no more than 30 days prior to the date on which the applicable Security Document is recorded, certified to the Agent and the issuer of the title insurance policy in a manner reasonably satisfactory to the Agent by a land surveyor duly registered and licensed in the state or province in which such Eligible Real Property is located and reasonably acceptable to the Agent, and shows all buildings and other improvements, any offsite improvements, the location of any easements, parking spaces, rights of way, building setback lines and other dimensional regulations and the absence of encroachments, either by such improvements or on to such property, and other defects, other than encroachments and other defects reasonably acceptable to the Agent; and (B) such Credit Party shall have used its reasonable best efforts to obtain such consents, agreements and confirmations of lessors and third parties as the Agent may deem necessary or desirable, together with evidence that all other actions that the Agent may deem necessary or desirable in order to create perfected first priority Liens (subject only to (i) the Administrative Charge and (ii) an unregistered Lien in respect of Priority Payables that are not yet due and payable) on the property described in the Collateral Document have been taken.

“Environmental Laws” means all Applicable Laws relating in any way to the environment, preservation or reclamation of natural resources, the generation, use, handling, collection, treatment, storage, transportation, recovery, recycling, release, threatened release or disposal of any Hazardous Material, or to health and safety matters.

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of any Credit Party directly or indirectly resulting from or based upon (a) violation of any Environmental Laws, (b) the generation, use, handling, collection, treatment, storage, transportation, recovery, recycling or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release or threatened Release of any Hazardous Materials into the environment, or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

“Equity Securities” means, with respect to any Person, any and all shares, interests, participations, rights in, or other equivalents (however designated and whether voting and non-voting) of, such Person’s capital, whether outstanding on the date hereof or issued after the date hereof, including any interest in a partnership, limited partnership or other similar Person and

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any beneficial interest in a trust, and any and all rights, warrants, debt securities, options or other rights exchangeable for or convertible into any of the foregoing.

“ETA” means Part IX of the Excise Tax Act (Canada) as amended from time to time (or any successor statute).

“Event of Default” has the meaning set out in Section 7.1.

“Excess Availability” means, as of any date, the remainder of (a) the Borrowing Base as of such date, less (b) the aggregate outstanding balance of the Indebtedness of the Borrower hereunder as of such date, and less (c) the aggregate face amount of issued and outstanding Letters of Credit as of such date. Excess Availability shall always be determined on the basis that all debts and obligations shall be current, and all accounts payable shall be handled in the normal course of the Borrower’s business consistent with its past practices.

“Excluded Taxes” means, with respect to the Agent, any Lender or any other recipient (in this definition, (a “recipient”) of any payment to be made by or on account of any obligation of the Borrower hereunder, income or franchise Taxes imposed on (or measured by) such recipients taxable income or capital Taxes imposed on (or measured by) such recipient’s taxable capital, in each case by Canada, or by the jurisdiction under the Applicable Law of which such recipient is organized or in which its principal office is located.

“Existing Notes” means the 8% senior subordinated notes due 2012 issued by the Borrower pursuant to the Note Indenture dated as of November 18, 2004 among the Borrower, as issuer, certain guarantors and The Bank of New York, as trustee.

“Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender’s Revolving Loans and, without duplication, its Letter of Credit Exposure at such time.

“Fair Market Value” shall mean the price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts determined in a manner acceptable to the Agent by an appraiser acceptable to the Agent.

“Federal Funds Effective Rate” means, for any day, the per annum rate equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System of the United States of America arranged by Federal funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Board of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Agent from three Federal funds brokers of recognized standing selected by it.

“Financial Officer” means the chief financial officer, principal accounting officer, treasurer or controller of the Borrower.

“Fiscal Quarter” means any fiscal quarter of the Borrower.

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“Fiscal Year” means any fiscal year of the Borrower.

“Futures Account” has the meaning ascribed to it in the PPSA.

“GAAP” means at any particular time with respect to any Credit Party, generally accepted accounting principles as in effect at such time in Canada, consistently applied; provided, however, that, if employment of more than one principle shall be permissible at such time in respect of a particular accounting matter, “GAAP” shall refer to the principle which is then employed by the applicable Credit Party with the concurrence of its independent public or chartered accountants, who are acceptable to the Agent provided further that, for the purposes of determining compliance with the financial covenants herein, “GAAP” means GAAP as at the date hereof.

“Governmental Authority” means the Government of Canada, any other nation or any political subdivision thereof, whether provincial, state, territorial or local, and any agency, authority, instrumentality, regulatory body, court, central bank, fiscal or monetary authority or other authority regulating financial institutions, and any other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to any such government, including the Bank Committee on Banking Regulation and Supervisory Practices of the Bank of International Settlements.

“GST” means the goods and services tax and all other amounts payable under the ETA or any similar legislation in any other jurisdiction of Canada, including QST and HST.

“Guarantee” of or by any Person (in this definition, the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (in this definition, the “primary credit party”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof (whether in the form of a loan, advance, stock purchase, capital contribution or otherwise), (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital solvency, or any other balance sheet, income statement or other financial statement condition or liquidity of the primary credit party so as to enable the primary credit party to pay such Indebtedness or other obligation, (d) as an account party in respect of any letter of credit or letter of guarantee issued to support such Indebtedness or other obligation, or (e) to purchase, sell or lease (as lessor or lessee) property, or to purchase or sell services, primarily for the purpose of enabling the debtor to make payment of such Indebtedness or to assure the holder of such Indebtedness against loss.

“Guarantor” means each Person which has executed and delivered to the Agent, for the benefit of the Lenders, a guarantee in form and substance satisfactory to the Agent.

“Hazardous Materials” means any substance, product, liquid, waste, pollutant, chemical, contaminant, insecticide, pesticide, gaseous or solid matter, organic or inorganic

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matter, fuel, micro-organism, ray, odour, radiation, energy, vector, plasma, constituent or material which (a) is or becomes listed, regulated or addressed under any Environmental Laws, or (b) is, or is deemed to be, alone or in any combination, hazardous, hazardous waste, toxic, a pollutant, a deleterious substance, a contaminant or a source of pollution or contamination under any Environmental Laws, including, asbestos or asbestos-containing materials, petroleum and polychlorinated biphenyls, including petroleum or petroleum distillates, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Laws.

“HST” means all amounts payable as harmonised sales tax in the Provinces of Nova Scotia, Newfoundland and Labrador and New Brunswick under the ETA.

“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guarantee, (j) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances, (k) all obligations of such Person under Swap Agreements, and (l) all obligations of such Person to purchase, redeem, retire, defease or otherwise acquire for value (other than for other Equity Securities) any Equity Securities of such Person, valued, in the case of redeemable Equity Securities, at the greater of voluntary or involuntary liquidation preference, plus accrued and unpaid dividends.

“Indemnified Taxes” means all Taxes other than Excluded Taxes.

“Indemnitee” has the meaning set out in Section 9.3(b).

“Initial Order” has the meaning set out in Section 2.19.

“Interest Payment Date” means the first Business Day of each month.

“Investment” means, as applied to any Person (the “investor”), any direct or indirect purchase or other acquisition by the investor of, or a beneficial interest in, Equity Securities of any other Person, including any exchange of Equity Securities for Indebtedness, or any direct or indirect loan, advance (other than advances to employees for moving and travel expenses, drawing accounts and similar expenditures in the ordinary course of business) or capital contribution by the investor to any other Person, including all Indebtedness and Accounts owing to the investor from such other Person that did not arise from sales or services rendered to such other Person in the ordinary course of the investor’s business, or any direct or indirect purchase

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or other acquisition of bonds, notes, debentures or other debt securities of, any other Person. The amount of any Investment shall be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment minus any amounts (a) realized upon the disposition of assets comprising an Investment (including the value of any liabilities assumed by any Person other than the Borrower or any Credit Party in connection with such disposition), (b) constituting repayments of Investments that are loans or advances or (c) constituting cash returns of principal or capital thereon (including any dividend, redemption or repurchase of equity that is accounted for, in accordance with GAAP, as a return of principal or capital).

“Issuing Bank” means the bank issuing Letters of Credit for the Borrower with the assistance of the Agent in accordance with Section 2.18.

“ITA” means the Income Tax Act (Canada) as amended from time to time (or any successor statute).

“Lender” means any Lender having a Commitment hereunder and/or a Revolving Loan outstanding hereunder.

“Lender Affiliate” means, with respect to any Lender, an Affiliate of such Lender.

“Lenders” means the Persons listed as lenders on Schedule A (and includes their respective successors) and any other Person that shall have become a party hereto pursuant to an Assignment and Assumption, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.

“Letter of Credit” means a letter of credit issued by the Issuing Bank for or on behalf of the Borrower with the assistance of the Agent in accordance with Section 2.18.

“Letter of Credit Exposure” means, at any time and subject to the Letter of Credit Sub-Line, the sum of: (a) the aggregate face amount of all outstanding Letters of Credit at such time, plus (b) the aggregate amount of all Reimbursement Obligations in respect of all Letter of Credit Guarantees at such time. The Letter of Credit Exposure of any Lender at any time shall be its Applicable Percentage of the total Letter of Credit Exposure at such time with the total of all such Letter of Credit Exposure of all Lenders not to exceed the Letter of Credit Sub-Line. Any Letter of Credit Exposure denominated in U.S. Dollars shall be the Cdn.$ Equivalent thereof.

“Letter of Credit Guarantee” means the agreement for the substitution of applicants or such other form of guarantee or indemnity agreement which is acceptable to the Issuing Bank and the Agent, supporting the issuance of Letters of Credit by the Issuing Bank provided the aggregate amount of all such Letters of Credit issued and to be issued shall not exceed the Letter of Credit Sub-Line.

“Letter of Credit Sub-Line” means the amount of the commitment by the Agent and the Lenders hereunder, in an aggregate amount up to but not exceeding $35,000,000, to assist the Borrower in obtaining Letters of Credit.

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“Lien” means, (a) with respect to any asset, any mortgage, deed of trust, lien, pledge, hypothec, hypothecation, encumbrance, charge, security interest, royalty interest, adverse claim, defect of title or right of set off in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease, title retention agreement or consignment agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to any asset, (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities, (d) any netting arrangement, defeasance arrangement or reciprocal fee arrangement, and (e) any other arrangement having the effect of providing security.

“Loan” means any loan made by the Lenders to the Borrower pursuant to this Agreement.

“Loan Documents” means this Agreement, the Security Documents, the Collateral Agency Agreement (including the Credit Confirmation and Amending Agreement), the Blocked Account Agreement, the Borrowing Requests, the Borrowing Base Reports and the Commitment Letter, and any other document, instrument or agreement (other than participation, agency or similar agreements among the Lenders or between any Lender and any other bank or creditor with respect to any indebtedness or obligations of any Credit Party hereunder or thereunder) now or hereafter entered into in connection with this Agreement, as such documents, instruments or agreements may be amended, modified or supplemented from time to time.

“Loan Facility Fee” has the meaning ascribed thereto in the Commitment Letter.

“Material Adverse Change” means any event, development or circumstance that has had or could reasonably be expected to have a Material Adverse Effect.

“Material Adverse Effect” means a material adverse effect on (a) the business, assets, operations, prospects or condition, financial or otherwise, of the Credit Parties taken as a whole, or (b) the validity or enforceability of any of the Loan Documents, the priority of the Liens created thereby or the rights and remedies of the Agent and the Lenders thereunder or (c) any Material Contract, or (d) the amount which the Lenders would be likely to receive (after giving effect to delays in payment and costs of enforcement) upon the liquidation of the Collateral; provided that the commencement and continuation of the CCAA Proceedings shall not, in an of itself, be deemed to constitute or give rise to a Material Adverse Effect.

“Material Contract” means (a) the contracts, licences and agreements listed and described on Schedule C, and (b) any other contract, licence or agreement (i) to which any Credit Party is a party or bound, (ii) which is material to, or necessary in, the operation of the business of any Credit Party, and (iii) which a Credit Party cannot promptly replace by an alternative and comparable contract with comparable commercial terms.

“Material Indebtedness” means any Indebtedness (other than the Loans ) of any one or more of the Credit Parties in an aggregate principal amount exceeding Cdn.$5,000,000.

“Maturity Date” means (a) if the Restructuring Event Date has not occurred, June 30, 2009, and (b) if the Restructuring Event Date has occurred, the date which is the earliest of (i)

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the date which is 12 months after the Restructuring Event Date, (ii) the date on which a plan of arrangement with respect to the Credit Parties under the CCAA has been implemented, having regard to all requisite CRTC approvals being in place, and (iii) the date of termination of this Agreement.

“Monitor” means the monitor to be appointed in the CCAA Proceedings.

“Net Orderly Liquidation Value” means, as to any particular asset, the value that is estimated to be recoverable in an orderly liquidation thereof, as determined from time to time by a qualified appraiser selected by the Agent, net of all liquidation costs and expenses.

“New Notes” means the notes issued by Canwest Media Inc. and Canwest Television Limited Partnership, as co-issuers, pursuant to the Note Purchase Agreement.

“New Noteholders” means the holders from time to time of the New Notes.

“Note Purchase Agreement” means the note purchase dated as of May 20, 2009 among Canwest Media Inc. and Canwest Television Limited Partnership, as co-issuers, and the note purchasers which are parties thereto, as purchasers, pursuant to which Canwest Media Inc. and Canwest Television Limited Partnership, as co-issuers, have issued notes in the aggregate principal amount of the US$ Equivalent of Cdn.$105,000,000 for a purchase price of the US$ Equivalent of Cdn.$100,000,000.

“Noteholder Priority Collateral” [redacted]. [Canwest has redacted the description of the Noteholder Priority Collateral, which is confidential.]

“Obligations” means all obligations, liabilities and Indebtedness of a Credit Party to the Agent, the Lenders or a Lender with respect to the principal of and interest on the Loans and the payment or performance of all other obligations, liabilities and Indebtedness of such Credit Party to the Agent, the Lenders or a Lender hereunder or arising under or pursuant to any one or more of the other Loan Documents or with respect to the Loans, including, without limitation, (i) all reimbursement and indemnity obligations of such Credit Party to the Agent, the Lenders or a Lender hereunder or in connection with any Letter of Credit Guarantee or otherwise and (ii) all interest (including all interest that accrues after the commencement of any case or proceeding by or against a Credit Party under any federal, provincial or state bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding), and all charges, expenses, fees, legal fees, filing fees and any other sums chargeable to such Credit Party hereunder, under another Loan Document, or under any other agreement or instrument with the Agent, Lenders or Issuing Bank.

“Out-of-Pocket Expenses” means all of the Agent’s present and future expenses incurred relative to this Agreement or any other Loan Documents, whether incurred heretofore or hereafter, which expenses shall include, without being limited to: the reasonable cost of retaining external legal counsel, record searches, all costs and expenses incurred by the Agent in opening bank accounts, depositing cheques, receiving and transferring funds, and wire transfer charges, any charges imposed on the Agent due to returned items and “insufficient funds” of deposited cheques and the Agent’s standard fees relating thereto, any amounts paid by, incurred by or

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charged to, the Agent by the Issuing Bank under a Letter of Credit Guarantee or the reimbursement agreements related thereto, applications for Letters of Credit or other like document which pertain either directly or indirectly to such Letters of Credit, and the Agent’s standard fees relating to the Letters of Credit and any drafts thereunder, reasonable travel, lodging and similar expenses of the Agent’s personnel (or any of its agents) in connection with inspecting and monitoring the Collateral from time to time at reasonable intervals hereunder, any applicable reasonable counsel fees and disbursements, fees and taxes relative to the filing of financing statements, and all expenses, costs and fees set forth incurred by or imposed on the Agent by reason of the exercise of any of its rights and remedies under this Agreement or any of the other Loan Documents.

“Parent” means Canwest Global Communications Corp., a CBCA corporation.

“Participant” has the meaning set out in Section 9.4.

“Payment Office” means the Agent’s office located at 207 Queen’s Quay West, Suite 700, Toronto, Ontario, M5J 1A7, Attention: Chief Credit Officer (or such other office or individual as the Agent may hereafter designate in writing to the other parties hereto).

“Pension Plan” means any registered or unregistered pension plan (including any plan subject to the Pension Benefits Standards Ac,. 1985 (Canada), the Pension Benefits Act (Ontario), or any similar pension benefits standards legislation, each as amended from time to time (or any successor statute) (i) which is maintained by any Credit Party or Affiliate, (ii) in respect of which any Credit Party or Related Party makes, has made or is required to make (at any time during the five (5) calendar years preceding the date of this Agreement) contributions in respect of its employees, or (iii) with respect to which any Credit Party or any Affiliate has incurred or may incur liability, including contingent liability either to such plan or to any Person, administration or Governmental Authority.

“Permitted Holders” means (a) the late Israel Xxxxxx Xxxxx (in this definition, the “Primary Permitted Holder”); (b) the spouse of the Primary Permitted Holder (including a widow or widower); (c) any lineal descendent of the Primary Permitted Holder (treating for this purpose, any legally adopted descendant as a lineal descendant); (d) the estate trustee of any Person listed in clauses (a) to (c); (e) any trust (whether testamentary or inter vivos) primarily for the lineal descendants of the Primary Permitted Holder, spouses of such lineal descendants, the Primary Permitted Holder himself or his spouse; and (f) any and all corporations which are directly or indirectly Controlled by any one or more of the foregoing.

“Permitted Liens” means “Permitted Encumbrances” as defined in the Collateral Agency Agreement, but excluding paragraph (o) thereof.

“Person” includes any natural person, corporation, company, limited liability company, unlimited liability company, trust, joint venture, association, incorporated organization, partnership, Governmental Authority or other entity.

“PPSA” means the Personal Property Security Act (Ontario), as amended from time to time (or any successor statute) or similar legislation of any other jurisdiction the laws of which

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are required by such legislation to be applied in connection with the issue, perfection, enforcement, validity or effect of security interests.

“Priority Payables” means, with respect to any Person, any amount payable by such Person which is secured by a Lien in favour of a Governmental Authority which ranks or is capable of ranking prior to or pari passu with the Liens created by the Security Documents in respect of any Eligible Accounts, including amounts owing for wages, vacation pay, severance pay, employee deductions, sales tax, excise tax, Tax payable pursuant to the ETA (net of GST input credits), income tax, workers compensation, government royalties, pension fund obligations, Canadian Pension and other Pension Plan obligations, real property tax and other statutory or other claims that have or may have priority over, or rank pari passu with, such Liens created by the Security Documents.

“Property” means any interest in any kind of property or asset, whether real (including chattels real), personal or mixed, movable or immovable, tangible or intangible.

“PST” means all taxes payable under the Retail Sales Tax Act (Ontario) or any similar statute of another jurisdiction of Canada.

“QST” means the Quebec sales tax imposed pursuant to an Act respecting the Québec sales tax.

“Register” has the meaning set out in Section 9.4(c).

“Reimbursement Obligations” means, at any date, the sum of the outstanding obligations of the Borrower to reimburse the Agent at such time to the extent that the Agent is obligated to reimburse the Issuing Bank at such time pursuant to any Letter of Credit Guarantee.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and of such Person’s Affiliates.

“Release” is to be broadly interpreted and shall include an actual or potential discharge, deposit, spill, leak, pumping, pouring, emission, emptying, injection, escape, leaching, seepage or disposal of any Hazardous Materials which is or may be in breach of any Environmental Laws.

“Repayment Notice” means a notice in the form of Exhibit J;

“Required Lenders” means, at any time, Lenders having Commitments which represent, in the aggregate, more than 50% of the aggregate amount of the Commitments of all the Lenders under the Credit.

“Responsible Officer” means, with respect to any Person, the chairman, the president, any vice president, the chief executive officer or the chief operating officer, and, in respect of financial or accounting matters, any Financial Officer of such Person; unless otherwise specified, all references herein to a Responsible Officer mean a Responsible Officer of the Borrower.

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“Restricted Payment” shall mean, with respect to any Person, any payment by such Person (i) of any dividends on any of its Equity Securities, (ii) on account of, or for the purpose of setting apart any property for a sinking or other analogous fund for, the purchase, redemption, retirement or other acquisition of any of its Equity Securities or any warrants, options or rights to acquire any Equity Securities, or the making by such Person of any other distribution in respect of any of its Equity Securities, (iii) of any principal of or interest or premium on or of any amount in respect of a sinking or analogous fund or defeasance fund for any Indebtedness of such Person ranking in right of payment or security subordinate to any liability of such Person under the Loan Documents, (iv) of any principal of or interest or premium on or of any amount in respect of a sinking or analogous fund or defeasance fund for any Indebtedness of such Person to a shareholder of such Person or to an Affiliate of a shareholder of such Person, (v) in respect of an Investment, or (vi) of any management, consulting or similar fee or any bonus payment or comparable payment, or by way of gift or other gratuity, to any Affiliate of such Person or to any director or officer thereof.

“Restructuring Event” means if the Borrower and the Guarantors which are organized under the laws of Canada or a province thereof or which have assets located in Canada, including Canwest MediaWorks Ireland Holdings, were to apply for relief from the Court via an initial order in proceedings under the CCAA and the Chapter 15 Entities for relief from the United States Bankruptcy Court for the Southern District of the State of New York in proceedings (the “Chapter 15 Proceedings”) under Chapter 15 of the United States Code via an order recognizing the CCAA Proceedings as the foreign main proceedings and granting a restraining order providing for a stay on substantially the same terms as provided for in the Initial Order (the “Chapter 15 Orders”).

“Restructuring Event Date” means the date on which a Restructuring Event first occurs.

“Revolving Loan” has the meaning set out in Section 2.1.

“Rolling Period” means, as at the end of any calendar month, such calendar month taken together with the eleven immediately preceding calendar months.

“Scheduled Capital Expenditures” means Capital Expenditures of the Borrower and the Credit Parties permitted for any Fiscal Year pursuant to Section 6.16.

“Security Documents” means the agreements, documents or instruments described or referred to in Section 4.1 and Section 5.11 (including, to the extent such Section describes an amendment, the agreement, document or instrument amended thereby) and any and all other agreements, documents or instruments now or hereafter executed and delivered by any Credit Party or any other Person as security for the payment or performance of all or part of the obligations of the Borrower (or such Credit Party or other Person) hereunder or under any other Loan Documents, as any of the foregoing may have been, or may hereafter be, amended, modified or supplemented.

“Securities Account” has the meaning ascribed to it in the STA.

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“Settlement Date” means the date, which shall be weekly, or more frequently at the discretion of the Agent upon the occurrence of an Event of Default or a continuing decline or increase of the Loans, that the Agent and the Lenders shall settle among themselves so that (a) the Agent shall not at any time have, as the agent for the Lenders, any money at risk, and (b) on such Settlement Date each Lender shall be responsible for its pro rata amount of the Revolving Loan, calculated on the basis of each of their Applicable Percentages in respect of the outstanding Exposure as at such date, provided that each Settlement Date shall be a Business Day.

“STA” means the Securities Transfer Act, 2006 (Ontario), as amended from time to time (or any successor statute).

“Stay of Proceedings” means the stay of proceedings against the Borrower and its Property and the stay of the exercise of rights and remedies against the Borrower and its property contained in the Initial Order, as it may be extended or amended by any other CCAA Order.

“Subsidiary” means, with respect to any Person (in this definition, the “parent”) at any date, any other Person the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other Person (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwise Controlled, in each case by the parent or one or more Subsidiaries of the parent or by the parent and one or more Subsidiaries of the parent; provided that, for the purpose of this Agreement, “Subsidiary” shall not include Canwest (Canada) Inc., Canwest Limited Partnership, Ten Network Holdings Limited, 4414616 Canada Inc. or any of their respective Subsidiaries.

“Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions.

“Swap Transaction” means any transaction or agreement entered into between the Borrower and any other counterparty with respect to any swap, forward, future or derivative transaction or agreement or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions.

“Taxes” means all taxes, charges, fees, levies, imposts and other assessments, including all income, sales, use, goods and services, value added, capital, capital gains, alternative, franchise, net worth, branch transfer, land transfer, profits, withholding, payroll, employer health, excise, stamp, documentary, real property and personal property taxes, and any other taxes, customs duties, fees, assessments, or similar charges in the nature of a tax, including Canada Pension Plan and provincial pension plan contributions, unemployment insurance

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payments and workers’ compensation premiums, together with any instalments with respect thereto, and any interest, fines and penalties with respect thereto, imposed by any Governmental Authority (including federal, state, provincial, territorial, municipal and foreign Governmental Authorities), and whether disputed or not.

“Ten Network Shares” means all Equity Securities owned, directly or indirectly, by the Borrower in Ten Network Holdings Limited.

“Transactions” means the execution, delivery and performance by the Borrower of this Agreement and the other Loan Documents, the borrowing of Loans, the use of the proceeds thereof and the issuance of Letters of Credit hereunder.

“Turkish Asset Sale” shall mean the sale of the shares or assets of Canwest Medya A.S., Canwest Medya Yönetim Ticaret U.C. A.S., Karaköy Televizyon ve Radyo Yayinciliĝi Ticaret A.S., CGS Televizyon ve Radyo Yayinciliĝi Ticaret A.S., Pasifik Televizyon ve Radyo Yayinciliĝi Ticaret A.S., Galata Televizyon ve Radyo Yayinciliĝi Ticaret A.S., and Halic Televizyon ve Radyo Yayinciliĝi A.S. or the sale of any amounts receivable from such entities or their shareholder, as applicable, pursuant to notes made to such entities or their shareholder by Canwest Irish Holdings (Barbados) Inc. or Canwest International Communications Inc. (all such assets collectively, the “Turkish Assets”).

“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Canadian Prime Rate or the Base Rate, or is a Letter of Credit.

“UCC” means the Uniform Commercial Code as in effect from time to time for the applicable State in question.

“U.S. Dollars” and “U.S.$” refer to lawful money of the United States of America.

“U.S.$ Equivalent” means, on any day, the amount of U.S. Dollars that the Agent could purchase, in accordance with its normal practice, with a specified amount of Canadian Dollars based on the spot rate at which U.S. Dollars are offered at the start of such day by CIBC in Xxxxxxx, Xxxxxxx.

“Violation Notice” means any notice received by any Credit Party from any Governmental Authority under any Environmental Law that the applicable Credit Party or any of its property and assets is not in compliance with the requirements of any Environmental Law.

“Weekly Cash Flow Projection” means a rolling 13-week cash flow projection, certified by a Responsible Officer and, after the Restructuring Event Date, the Monitor and in all cases approved by the Lenders. The initial Weekly Cash Flow Projection is the cash flow projection dated May 19, 2009 delivered by the Borrower to the Agent.

1.2 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a “Canadian Prime Rate Loan”) and Borrowings also may be classified and referred to by Type (e.g., a “Canadian Prime Rate Borrowing”).

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1.3 Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be construed to have the same meaning and effect as the word ‘shall”. The word “or” is disjunctive; the word “and” is conjunctive. The word “shall” is mandatory; the word “may” is permissive. The words “to the knowledge of” means, when modifying a representation, warranty or other statement of any Person, that the fact or situation described therein is known by the Person (or, in the case or a Person other than a natural Person, known by the Responsible Officer of that Person) making the representation, warranty or other statement, or with the exercise of reasonable due diligence under the circumstances (in accordance with the standard of what a reasonable Person in similar circumstances would have done) would have been known by the Person (or, in the case of a Person other than a natural Person, would have been known by such Responsible Officer of that Person). Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any statute or any section thereof shall, unless otherwise expressly stated, be deemed to be a reference to such statute or section as amended, restated or re-enacted from time to time, (c) any reference herein to any Person shall be construed to include such Person’s successors and permitted assigns, (d) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, and (f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

1.4 Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time. All calculations of the components of the financial information for the purposes of determining compliance with the financial ratios and financial covenants contained herein shall be made on a basis consistent with GAAP in existence as at the date of this Agreement and used in the preparation of the consolidated financial statements of the Borrower referred to in Section 5.1(f). Upon the adoption by the Borrower of International Financial Reporting Standards, or in the event of a change in GAAP, the Borrower and the Agent shall negotiate in good faith to revise (if appropriate) such ratios and covenants to give effect to the intention of the parties under this Agreement as at the Closing Date, and any new ratio or covenant shall be subject to approval by the Required Lenders. In the event that such negotiation is unsuccessful, all calculations thereafter made for the purpose of determining compliance with the financial ratios and financial covenants contained herein shall be made on a basis consistent with GAAP in existence as at the Closing Date.

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1.5 Time. All time references herein shall, unless otherwise specified, be references to local time in Xxxxxxx, Xxxxxxx. Time is of the essence of this Agreement and the other Loan Documents.

1.6 Permitted Liens. Any reference in any of the Loan Documents to a Permitted Lien is not intended to subordinate or postpone, and shall not be interpreted as subordinating or postponing, or as any agreement to subordinate or postpone, any Lien created by any of the Loan Documents to any Permitted Lien.

1.7 Interpretation Clause (Québec). For purposes of any assets, liabilities or entities located in the Province of Québec and for all other purposes pursuant to which the interpretation or construction of this Agreement may be subject to the laws of the Province of Québec or a court or tribunal exercising jurisdiction in the Province of Québec, (a) “personal property” shall be deemed to include “movable property”, (b) “real property” shall be deemed to include “immovable property”, (c) “tangible property” shall be deemed to include “corporeal property”, (d) “intangible property” shall be deemed to include “incorporeal property”, (e) “security interest”, “mortgage” and “lien” shall be deemed to include a “hypothec”, “prior claim” and a resolutory clause, (f) all references to filing, registering or recording under the PPSA or UCC shall be deemed to include publication under the Civil Code of Québec, (g) all references to “perfection” of or “perfected” liens or security interest shall be deemed to include a reference to an “opposable” or “set up” lien or security interest as against third parties, (h) any “right of offset”, "right of setoff" or similar expression shall be deemed to include a “right of compensation”, (i) “goods” shall be deemed to include “corporeal movable property” other than chattel paper, documents of title, instruments, money and securities, (j) an “agent” shall be deemed to include a “mandatary”, (k) “construction liens” shall be deemed to include “legal hypothecs”; (l) “joint and several” shall be deemed to include solidary; (m) “gross negligence or wilful misconduct” shall be deemed to be “intentional or gross fault”; (n) “beneficial ownership” shall be deemed to include “ownership on behalf of another as mandatary”; (o) “servitude” shall be deemed to include easement; (p) “priority” shall be deemed to include “prior claim”; (q) “survey” shall be deemed to include “certificate of location and plan”; (r) “state” shall be deemed to include “province”; (s) “fee simple title” shall be deemed to include “absolute ownership”. The parties hereto confirm that it is their wish that this Agreement and any other document executed in connection with the transactions contemplated herein be drawn up in the English language only and that all other documents contemplated thereunder or relating thereto, including notices, may also be drawn up in the English language only. Les parties aux présentes confirment que c'est leur volonté que cette convention et les autres documents de crédit soient rédigés en langue anglaise seulement et que tous les documents, y compris tous avis, envisages par cette convention et les autres documents peuvent être rédigés en la langue anglaise seulement.

ARTICLE 2

THE CREDITS

2.1 Commitments. Subject to the terms and conditions set forth herein, each Lender commits to make Loans (each such Loan made under this Section 2.1, a “Revolving Loan”) to the Borrower from time to time during the period commencing on the Effective Date and ending on the Maturity Date (each such commitment, a “Commitment”) in an aggregate principal

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amount up to the amount set forth beside such Lender’s name in Schedule A under the heading “Commitment”, provided that any Revolving Loans made by any Lender as requested by the Borrower will not result in (i) such Lender’s Exposure exceeding such Lender’s Commitment, or (ii) the sum of the total Exposure exceeding either the total Commitment or the Borrowing Base. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, repay and reborrow Revolving Loans.

2.2 Loans and Borrowings.

(a) Each Revolving Loan shall be made as part of a Borrowing consisting of Revolving Loans made by the Lenders rateably in accordance with their respective Commitments. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.

(b) Subject to the Letter of Credit Sub-Line limitation, the Borrowing Base limitations and the other limitations on Loans and Borrowings as provided in this Agreement, each Borrowing shall be comprised entirely of Canadian Prime Loans, Base Rate Loans, and/or the delivery of Letters of Credit Guarantees as the Borrower may request in accordance herewith.

2.3 Requests for Borrowings.

(a) The initial Borrowings hereunder on the Effective Date in respect of the Revolving Credit shall be Canadian Prime Borrowings. Thereafter, to request a Borrowing, the Borrower shall notify the Agent of such request by written Borrowing Request not later than 10:00 a.m., Toronto time, on the date of the proposed Borrowing; or (ii) in the case of the issuance of a Letter of Credit Guarantee in accordance with Section 2.18, not later than 11:00 a.m., Toronto time, five (5) Business Days before the date of the proposed Borrowing. The Agent and each Lender are entitled to rely and act upon any written Borrowing Request given or purportedly given by the Borrower, and the Borrower hereby waives the right to dispute the authenticity and validity of any such request or resulting transaction once the Agent or any Lender has advanced funds or issued a Letter a Credit Guarantee based on such written Borrowing Request. Each such written Borrowing Request shall be substantially in the form of Exhibit B and shall specify the following information:

(i)	the aggregate amount of each requested Borrowing and the Type thereof;

(ii)	the date of such Borrowing, which shall be a Business Day;

(iii)

whether such Borrowing is to be a Canadian Prime Borrowing, a Base Rate Borrowing, or the issuance of a Letter of Credit Guarantee in accordance with Section 2.18;

(iv)	the location and number of the Borrower’s account to which funds are to be disbursed, which shall comply with the requirements of this Agreement.

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(b) If no currency is specified, the Borrowing shall be denominated in Canadian Dollars.

(c) Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request. Thereafter, the Borrower may elect to convert a Borrowing to a different Type. To make an election pursuant to this Section 2.3(c), the Borrower shall notify the Agent of such election in the manner and by the time that a Borrowing Request would be required under Section 2.3(a).

(d) The Agent shall not incur any liability to the Borrower as a result of acting in accordance with any notice or request referred to in this Section 2.3, which notice or request the Agent believes in good faith to have been given by an officer duly authorized by the Borrower to request Loans on its behalf or for otherwise acting in good faith under this Section 2.3, and the crediting of Loans to the Borrower’s disbursement accounts, or transmittal to such Person or other bank account as the Borrower shall direct, shall conclusively establish the obligation of the Borrower to repay such Loans as provided herein. Nothing herein shall, however, release or be deemed to release the Agent in respect of its gross negligence or wilful misconduct.

(e) Except to the extent otherwise permitted to the contrary hereunder, any Borrowing Request made pursuant to in this Section 2.3 shall be irrevocable and the Borrower shall be bound to borrow the funds requested therein in accordance therewith.

2.4 Funding of Borrowings.

(a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, Toronto time, to the account of the Agent most recently designated by it for such purpose by notice to the Lenders. The Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account of the Borrower and designated by the Borrower in the applicable Borrowing Request . The Borrower shall satisfy Reimbursement Obligations promptly as they arise by way of a request for a Loan and all Loans made hereunder to satisfy Reimbursement Obligations in respect of any Letter of Credit Guarantee shall be remitted by the Agent to the Issuing Bank in accordance with such Letter of Credit Guarantee (unless the Issuing Bank has already been fully reimbursed directly by the Borrower in respect of drawings under the Letter of Credit which is the subject of such Letter of Credit Guarantee).

(b) The Agent may, upon notice given by the Agent no later than 12:00 p.m. Toronto time on any Settlement Date, request each Lender to make, and each Lender hereby agrees to make, a Revolving Loan in an amount equal to such Lender’s Applicable Percentage (calculated with respect to the aggregate Commitments then outstanding) of the aggregate amount of the Revolving Loans made by the Agent from the preceding Settlement Date to the date of such notice. Each Lender’s obligation to make the Revolving Loans and to make the settlements pursuant to this Section 2.4 shall not be affected by any circumstance, including (i) any set-off, counterclaim, recoupment, defence or other right which any such Lender or the Borrower may have against the Agent, the Borrower, any Lender or any other Person for any reason whatsoever; (ii) any adverse change in the condition (financial or otherwise) of the Borrower; or (iii) any other circumstance, happening or event whatsoever, whether or not similar to any of the

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foregoing. Without limiting the liability and obligation of each Lender to make such advances, the Borrower authorizes the Agent to charge the Borrower’s loan account to the extent amounts received from the Lenders are not sufficient to repay in full the amount of any such deficiency. To the extent that any Lender has failed to fund all such payments and Revolving Loans, the Agent shall be entitled to set off the funding short-fall against that Lender’s pro rata share of all payments received from the Borrower.

(c) The Agent, for the account of the Lenders, shall disburse all amounts to the Borrower and shall handle all collections. It is understood that for purposes of advances to the Borrower and for purposes of this Section 2.4, the Agent is using the funds of the Agent.

(d) Unless the Agent shall have been notified in writing by any Lender prior to any advance to the Borrower that such Lender will not make the amount which would constitute its share of the Borrowing on such date available to the Agent, the Agent may assume that such Lender shall make such amount available to the Agent on a Settlement Date, and the Agent may, in reliance upon such assumption, make available to the Borrower a corresponding amount. A certificate of the Agent submitted to any Lender with respect to any amount owing under this Section 2.4 shall be conclusive, absent manifest error. If such Lender’s share of such Borrowing is not in fact made available to the Agent by such Lender on the Settlement Date, the Agent shall be entitled to recover such amount with interest thereon at the rate per annum applicable to Revolving Loans hereunder, on demand, from the Borrower without prejudice to any rights which the Agent may have against such Lender hereunder. Nothing contained in this shall relieve any Lender which has failed to make available its Applicable Percentage of any borrowing hereunder from its obligation to do so in accordance with the terms hereof. Nothing contained herein shall be deemed to obligate the Agent to make available to the Borrower the full amount of a requested advance when the Agent has any notice (written or otherwise) that any of the Lenders will not advance its Applicable Percentage thereof.

(e) On the Settlement Date, the Agent and the Lenders shall each remit to the other, in immediately available funds, all amounts necessary so as to ensure that, as of the Settlement Date, the Lenders shall have their Applicable Percentage share of all outstanding Obligations.

(f) The Agent shall forward to each Lender, at the end of each calendar month, a copy of the account statement rendered by the Agent to the Borrower.

(g) The Agent shall, after receipt of any interest and fees earned under this Agreement, promptly remit to the Lenders their Applicable Percentage of any (i) fees they are entitled to receive, and (ii) interest computed at the rate and as provided for in this Agreement on all outstanding amounts advanced by the Lenders on each Settlement Date, prior to adjustment, that are subsequent to the last remittance by the Agent to the Lenders of such interest amounts.

2.5 Interest.

(a) The Loans comprising each Canadian Prime Borrowing shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 days or 366 days, as the case may be) at a rate per annum equal to the Canadian Prime Rate plus the Applicable Margin from time to time in effect. The Loans comprising each Base Rate Borrowing shall bear

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interest (computed on the basis of the actual number of days elapsed over a year of 360 days at a rate per annum equal to the Base Rate plus the Applicable Margin from time to time in effect.

(b) If there is a Default or an Event of Default has occurred and is continuing, all amounts outstanding hereunder (including, without duplication, all Loans and all Letter of Credit Exposure) shall bear interest, after as well as before judgment, at a rate per annum equal to 2% plus the rate otherwise applicable to such Loan or, in the case of any amount not constituting principal or interest on a Loan, at a rate equal to 2% plus the rate otherwise applicable to, in the case of Canadian Dollar amounts, Canadian Prime Loans, or in the case of U.S. Dollar amounts, Base Rate Loans.

(c) Accrued interest on each Loan shall be payable in arrears on the earlier of (i) each applicable Interest Payment Date, and (ii) the date of termination of the Commitments. In addition, in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment.

(d) All interest hereunder shall be payable for the actual number of days elapsed (including the first day but excluding the last day). Any Loan that is repaid on the same day on which it is made shall bear interest for one day. The applicable Canadian Prime Rate or Base Rate shall be determined by the Agent, and such determination shall be conclusive absent manifest error.

(e) For the purposes of the Interest Act (Canada) and disclosure thereunder, whenever any interest or any fee to be paid hereunder or in connection herewith is to be calculated on the basis of a 360-day or 365-day year, the yearly rate of interest to which the rate used in such calculation is equivalent is the rate so used multiplied by the actual number of days in the calendar year in which the same is to be ascertained and divided by 360 or 365, as applicable. The rates of interest under this Agreement are nominal rates, and not effective rates or yields. The principle of deemed reinvestment of interest does not apply to any interest calculation under this Agreement.

(f) If any provision of this Agreement would oblige the Borrower to make any payment of interest or other amount payable to any Lender in an amount or calculated at a rate which would be prohibited by any Applicable Law or would result in a receipt by that Lender of “interest” at a “criminal rate” (as such terms are construed under the Criminal Code (Canada)), then, notwithstanding such provision, such amount or rate shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by Applicable Law or so result in a receipt by that Lender of “interest” at a “criminal rate”, such adjustment to be effected, to the extent necessary (but only to the extent necessary), as follows:

(i)	first, by reducing the amount or rate of interest required to be paid to the affected Lender under Section 2.5; and

(ii)	thereafter, by reducing any fees, commissions, costs, expenses, premiums and other amounts required to be paid to the affected Lender which would

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constitute interest for purposes of section 347 of the Criminal Code (Canada).

2.6 Termination and Reduction of Commitments.

(a) Unless previously terminated and subject to any earlier demand for payment upon the occurrence of an Event of Default, the Commitments shall terminate on the Maturity Date.

(b) The Borrower may, upon five Business Days prior written notice to the Agent, permanently cancel any unused portion of the Commitments. The Agent shall promptly notify each Lender of the receipt by the Agent of any such notice. Any such cancellation shall be applied rateably in respect of the Commitments of each Lender. Each notice delivered by the Borrower pursuant to this Section 2.6(b) shall be irrevocable. Notwithstanding the termination of this Agreement, until all Obligations are irrevocably and indefeasibly paid and performed in full, the Credit Parties shall remain bound by the terms of this Agreement and under the Loan Documents and shall not be relieved of any of their Obligations and the Agent and Lenders shall retain all their rights and remedies hereunder and under the Loan Documents (including, without limitation, in all then existing and after-arising Collateral). Pending a final accounting, the Agent may withhold any balances in the Borrower’s loan account to cover all of the Obligations, whether absolute or contingent, including cash reserves for any contingent Obligations, including an amount equal to 110% of the face amount of any outstanding Letters of Credit with an expiry date on, or within thirty (30) days of the effective date of termination of this Agreement.

(c) Unless the Commitments have been previously terminated, upon the occurrence of the Maturity Date in respect of any Lender, the Commitment thereof shall be permanently reduced to an amount equal to the amount of the Loans made by such Lender at such date and the Commitment shall be permanently reduced by an amount equal to such reduction of such Commitment.

2.7 Repayment of Loans. The Borrower hereby unconditionally promises to pay to the Agent for the account of each Lender the then unpaid principal amount of each Revolving Loan and all other Obligations on the earlier of the Maturity Date and the date that the Commitment is terminated pursuant to Section 2.6(b) or Section 7.1.

2.8 Evidence of Debt.

(a) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the Indebtedness of the Borrower to such Lender resulting from each Borrowing made by such Lender hereunder, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.

(b) The Agent shall maintain accounts in which it shall record (i) the amount of each Borrowing made hereunder, and the Type thereof, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder, and (iii) the amount of any sum received by the Agent hereunder for the account of the Lenders and each Lender’s share thereof.

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(c) The entries made in the accounts maintained pursuant to Sections 2.8(a) and (b) shall be conclusive evidence (absent manifest error) of the existence and amounts of the obligations recorded therein and shall be admissible in any action or proceeding arising therefrom; provided that the failure of any Lender or the Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Borrowings in accordance with the terms of this Agreement. In the event of a conflict between the records maintained by the Agent and any Lender, the records maintained by the Agent shall govern.

(d) Any Lender may request that Loans made by it be evidenced by a promissory note. In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved by the Agent. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times be represented by one or more promissory notes in such form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).

2.9 Prepayments.

(a) Mandatory Borrowing Base Prepayments. If at any time the aggregate Exposure of all Lenders is in excess of (i) the Borrowing Base or (ii) the total Commitment, the Borrower shall immediately pay to the Agent, for the account of the Lenders, the amount of such excess to be applied (i) first, in satisfaction of all Reimbursement Obligations, if any, outstanding at such time, (ii) second, as a prepayment of the Revolving Loans, and (iii) third, as Cover for any remaining Letter of Credit Exposure in an amount of such remaining excess.

(b) Application of Cover Amount. The amount of Cover shall be paid by the Borrower to the Agent on the Maturity Date and retained by the Agent in a collateral account maintained by the Agent at its Payment Office and collaterally assigned to, or charged in favour of, the Agent as security until such time as the applicable Letters of Credit shall have expired or matured and Reimbursement Obligations, if any, with respect thereto shall have been fully satisfied; provided that if any such Reimbursement Obligations are not satisfied when due hereunder, the Agent may apply any or all amounts in such collateral account in satisfaction of any or all such Reimbursement Obligations.

(c) Currency Fluctuations. If, at any time, the Canadian $ Equivalent of the Loans made by any Lender to the Borrower under any Credit exceeds the Commitment of such Lender under such Credit (any such excess being referred to in this Section as an “Excess Amount”), then the Borrower will forthwith repay to the Agent, for the account of each applicable Lender, an amount equal to the Excess Amount with respect to such Lender. The Agent shall request repayment of any Excess Amount forthwith upon request therefor by any Lender, but the Agent is not otherwise required to monitor Excess Amount levels or to request repayment thereof.

(d) Voluntary Prepayment. The Borrower may, upon delivery of a Repayment Notice to the Agent (delivered in accordance with the notice periods applicable to delivery of a Borrowing Request under Section 2.3(a)), prepay all or any part of a Canadian Prime Borrowing

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or Base Rate Borrowing. No prepayment under this Section 2.9(d) shall permanently reduce or terminate any of the Commitments.

(e) Mandatory Payments. If any Credit Party sells or otherwise disposes of any assets (other than obsolete assets in the ordinary course of business and other than the Turkish Assets), then the applicable Credit Party shall pay an amount equal to the net proceeds received by such Credit Party on account of such sale or other disposition (i) to the Agent in reduction of the Exposure hereunder if such assets constitute CIT Priority Collateral (and the Commitments shall be reduced by a corresponding amount) or (ii) to the New Noteholders if such assets constitute Noteholder Priority Collateral to the extent required in accordance with the Note Purchase Agreement and, following repayment in full of the amounts owing to the New Noteholders under the Note Purchase Agreement, any balance shall be paid to the Agent in reduction of the Exposure hereunder (and the Commitments shall be reduced by a corresponding amount) .

(f) Notice by Agent. Upon receipt of any prepayment or Repayment Notice pursuant to this Section 2.9, the Agent shall promptly notify each applicable Lender of the contents thereof and of such Lender’s Applicable Percentage of such prepayment. Each Repayment Notice provided by the Borrower in respect of any permanent repayment or prepayment hereunder shall be in the form of Schedule 2.9 (e) and shall be irrevocable at such time as the Agent or any Lender has commenced taking any action pursuant to any such prepayment notice.

2.10 Fees.

(a) The Borrower shall pay to the Agent for the account of and distribution to each Lender rateably in accordance with each such Lender’s Applicable Percentage an unused line fee (the “Unused Line Fee”) for the period commencing on the Effective Date to and including the Maturity Date (or such earlier date as the Commitments shall have been terminated entirely) computed at a rate of 0.50% per annum on the average daily excess amount of the aggregate Commitments over the aggregate Exposure. The Unused Line Fees on the Commitments shall be calculated monthly in arrears on the last Business Day of each calendar month (and on the date on which the Commitments terminate) and each such calculated amount shall be payable on the first Business Day of the immediately following calendar month (or on the date on which the Commitments terminate, as the case may be). All Unused Line Fees shall be computed on the basis of a year of 365 or 366 days, as the case may be, and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).

(b) The Borrower agrees to pay to the Agent for the account of each Lender rateably in accordance with each Lender’s Applicable Percentage, a guarantee fee (a “Letter of Credit Guarantee Fee”) with respect to the provision of Letter of Credit Guarantees, at the rate of 7.75% per annum on the average daily amount of the Letter of Credit Exposure during the period from and including the Effective Date (or the date on which any Letter of Credit Exposure first exists to but excluding the latter of: (i) the date of termination of the Commitments and (ii) the date on which there ceases to be any Letter of Credit Exposure. All Letter of Credit Guarantee Fees payable pursuant to this Section 2.10(b) shall be computed on the basis of a year of 365 or 366 days, as the case may be, and shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The Borrower also agrees to pay to the

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Agent, for the account of the Issuing Bank, the Issuing Bank’s standard fees (the “Standard Letter of Credit Fees”) with respect to the issuance (currently 0.45% on the face amount of the Letter of Credit at the time of issuance), administration, handling, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder. Such standard fees shall be payable within 10 days after demand by the Agent or the Issuing Bank. It is acknowledged and agreed by the Lenders that the Issuing Bank may charge fees and other amounts directly to the Agent as a condition to issuing Letters of Credit and such fees and other amounts, to the extent that the Agent has not been reimbursed therefor by the Borrower, shall be charged by the Agent against each Lender’s rateable share (taking into account each such Lender’s Applicable Percentage) of other amounts owing from the Agent to each Lender (including, without limitation, each such Lender’s rateable share of Letter of Credit Guarantee Fees or Standard Letter of Credit Fees).

(c) The Borrower agrees to pay to the Agent, for its own account, (i) on the Effective Date that portion of the Loan Facility Fee payable (in accordance with the Commitment Letter) on the Effective Date, and (ii) on the Restructuring Event Date that portion of the Loan Facility Fee payable (in accordance with the Commitment Letter) on the Restructuring Event Date.

(d) The Borrower agrees to pay to the Agent, for its own account, on the Effective Date and on the first Business Day of each calendar month thereafter the Administrative Management Fee, which the Borrower acknowledges and agrees shall be fully earned when paid.

(e) The Borrower agrees to pay to the Agent, for its own account, the Agent’s standard charges, fees, costs and expenses for its field examinations, verifications and audits in an amount equal to $1,200 per person per day plus such field examiner’s and auditor’s out-of-pocket expenses.

(f) The Borrower agrees to pay to the Agent, for its own account, fees payable in the amounts and at the times separately agreed upon in writing between the Borrower and the Agent.

(g) All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Agent, for its own account or for distribution to the Lenders or the Issuing Bank, as the case may be. Fees paid shall not be refundable except in the case of manifest error in the calculation of any fee payment.

2.11 [Intentionally Deleted.]

2.12 Increased Costs; Illegality; Alternate Rate of Interest.

(a) If any Change in Law shall:

(i)	impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender; or

(ii)	impose on any Lender or the Issuing Bank or the London interbank market any other condition affecting this Agreement (including the imposition on

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any Lender of, or any change to, any Indemnified Tax or other charge with respect to its Loans or any Letter of Credit or participation therein, or its obligation to make Loans or any Letter of Credit);

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender of participating in, issuing or maintaining any Letter of Credit or any Loan or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender, such additional amount or amounts as will compensate such Lender, for such additional costs incurred or reduction suffered.

(b) If any Lender determines that any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit held by such Lender, or the Letters of Credit issued by the Issuing Bank, to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy) and such Lender’s desired return on capital, then from time to time the Borrower will pay to such Lender, such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

(c) A certificate of a Lender setting forth amount or amounts necessary to compensate such Lender as specified in Sections 2.12(a) or (b), together with a brief description of the Change of Law, shall be delivered to the Borrower, and shall be conclusive absent manifest error. In preparing any such certificate, a Lender shall be entitled to use averages and to make reasonable estimates, and shall not be required to “match contracts” or to isolate particular transactions. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

(d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section 2.12 shall not constitute a waiver of such Lender’s right to demand such compensation.

(e) In the event that any Lender shall have determined (which determination shall be reasonably exercised and shall, absent manifest error, be final, conclusive and binding upon all parties) at any time that the current or reasonably expected foreign currency markets are unusually unstable or that the making or continuance of any Loan denominated in a currency other than Canadian Dollars has become unlawful or materially restricted as a result of compliance by such Lender in good faith with any Applicable Law, or by any applicable guideline or order (whether or not having the force of law and whether or not failure to comply therewith would be unlawful), then, in any such event, such Lender shall give prompt notice (by telephone and confirmed in writing) to the Borrower and to the Agent of such determination (which notice the Agent shall promptly transmit to the other Lenders). Upon the giving of the notice to the Borrower referred to in this Section 2.12(e), the Borrower’s right to request (by continuation, conversion or otherwise), and such Lender’s obligation to make, Loans

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denominated in a currency other than Canadian Dollars shall be immediately suspended, and thereafter any requested Borrowing of Loans denominated in a currency other than Canadian Dollars shall, as to such Lender only, be deemed to be a request for a Canadian Prime Loan, and if the affected Loan or Loans are then outstanding, the Borrower shall immediately, or if permitted by Applicable Law, no later than the date permitted thereby, upon at least one Business Day prior written notice to the Agent and the affected Lender, convert each such Loan denominated in a currency other than Canadian Dollars into a Canadian Prime Loan, provided that if more than one Lender is affected at any time, then all affected Lenders must be treated the same pursuant to this Section 2.12(e).

2.13 [Intentionally Deleted.]

2.14 Taxes.

(a) Any and all payments by or on account of any obligation of the Borrower hereunder shall be made free and clear of and without deduction or withholding for any Indemnified Taxes; provided that if the Borrower shall be required to deduct or withhold any Indemnified Taxes from such payments, then (i) the sum payable shall be increased as necessary so that, after making all required deductions or withholdings (including deductions or withholdings applicable to additional sums payable under this Section 2.14), the Agent, or Lender (as the case may be) receives an amount equal to the sum it would have received had no such deduction or withholding been made, (ii) the Borrower shall make such deduction or withholding, and (iii) the Borrower shall pay to the relevant Governmental Authority in accordance with Applicable Law the full amount deducted or withheld.

(b) In addition to the payments by the Borrower required by Section 2.14(a), the Borrower shall pay any and all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement to the relevant Governmental Authority in accordance with Applicable Law.

(c) The Borrower shall indemnify the Agent, and each Lender, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes paid by the Agent, such Lender, as the case may be, on or with respect to any payment by or on account of any obligation of the Borrower hereunder (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 2.14) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender, or by the Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(d) As soon as practicable after any payment of Indemnified Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Agent.

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(e) If the Agent or a Lender determines, in its sole discretion, that it has received a refund of any Taxes as to which it has been indemnified by the Borrower or with respect to which the Borrower has paid additional amounts pursuant to this Section 2.14 and, in the Agent’s or such Lender’s opinion, such refund amount is both reasonably identifiable and quantifiable by it without involving it in an unacceptable administrative burden, it shall pay over such refund amount to the Borrower (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower under this Section 2.14 with respect to the Taxes giving rise to such refund, and only to the extent that the Agent or Lender, as applicable, is satisfied that it may do so without prejudice to its right, as against the relevant Governmental Authority, to retain such refund), net of all out-of-pocket expenses of the Agent or such Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided, that the Borrower, upon the request of the Agent or such Lender, agrees to repay the amount paid over to the Borrower (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Agent or such Lender if the Agent or such Lender is required to repay such refund to such Governmental Authority. Nothing herein contained shall (i) interfere with the right of the Agent or any Lender to arrange its affairs in whatever manner it thinks fit and, in particular, no Lender shall be under any obligation to claim relief for tax purposes on its corporate profits or otherwise, or to claim such relief in priority to any other claims, reliefs, credits or deductions available to it, or (ii) require the Agent or any Lender to make available its tax returns (or any other information relating to its Taxes which it deems confidential) to the Borrower or any other Person.

2.15 Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

(a) The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees or amounts payable in respect of Reimbursement Obligations, amounts payable under any of Sections 2.12 or 2.14, or amounts otherwise payable hereunder) prior to 12:00 noon, Toronto time, on the date when due, in immediately available funds, without set-off or counterclaim. Any amounts received after such time on any date may, in the discretion of the Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Agent at the Payment Office, except that payments pursuant to any indemnities contained herein shall be made directly to the Persons entitled thereto. The Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension, Base Rate Loans shall be made in U.S. Dollars. All other payments under this Section 2.15 shall be made in Canadian Dollars. The Borrower hereby authorizes the Agent to debit the Borrower’s loan account to effect any payment due to the Lenders or the Agent pursuant to this Agreement. Any resulting overdraft in such account shall be payable by the Borrower to the Agent in same day funds.

(b) If at any time insufficient funds are received by and available to the Agent to pay fully all amounts of principal, interest, fees, amounts payable in respect of Reimbursement Obligations, amounts payable under any of Sections 2.12 or 2.14 and other amounts payable

12298241.7

hereunder, any available funds shall be applied (i) first, to pay any fees, indemnities or expense reimbursements then due to the Agent from the Borrower, (ii) second, to pay any fees or expense reimbursements then due to the Lenders from the Borrower, (iii) third, to pay interest due in respect of all Revolving Loans, (iv) fourth, to pay or prepay principal of the Revolving Loans and unpaid Reimbursement Obligations and (v) fifth, to the payment of any other Obligation due to the Agent or any Lender by the Borrower, including amounts payable under any of Sections 2.12 or 2.14 and other amounts otherwise payable hereunder.

(c) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on or fees in respect of any of its Revolving Loans or its share of Reimbursement Obligations resulting in such Lender receiving payment of a greater proportion of the aggregate amount of any principal of or interest on or fees in respect of any of its Revolving Loans or participations in Reimbursement Obligations than the proportion to which it is entitled, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Revolving Loans or participations in Reimbursement Obligations owed to other Lenders (as the case may be) to the extent necessary so that the benefit of all such payments shall be shared by the Lenders rateably taking into account each of the Applicable Percentages in respect of each Lender; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) this Section 2.15(c) shall not apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in Reimbursement Obligations to any assignee or participant, other than to the Borrower or other Credit Party or any Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under Applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.

(d) Unless the Agent shall have received written notice from the Borrower prior to the date on which any payment is due to the Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders, severally agrees to repay to the Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Agent, at the applicable rate for Canadian Prime Loans (if such amount is denominated in Canadian Dollars) or the applicable rate for Base Rate Loans (if such amount is denominated in U.S. Dollars).

(e) If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.15(d), then the Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Agent for the account of such Lender to

12298241.7

satisfy such Lender’s obligations under such Section 2.15(d) until all such unsatisfied obligations are fully paid.

(f) Nothing in this Agreement shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

2.16 Currency Indemnity. If, for the purposes of obtaining judgment in any court in any jurisdiction with respect to this Agreement or any other Loan Document, it becomes necessary to convert into a particular currency (the “Judgment Currency”) any amount due under this Agreement or under any other Loan Document in any currency other than the Judgment Currency (the “Currency Due”), then conversion shall be made at the rate of exchange prevailing on the Business Day before the day on which judgment is given. For this purpose “rate of exchange” means the rate at which the Agent is able, on the relevant date, to purchase the Currency Due with the Judgment Currency in accordance with its normal practice at its head office in Xxxxxxx, Xxxxxxx. In the event that there is a change in the rate of exchange prevailing between the Business Day before the day on which the judgment is given and the date of receipt by the Agent of the amount due, the Borrower will, on the date of receipt by the Agent, pay such additional amounts, if any, or be entitled to receive reimbursement of such amount, if any, as may be necessary to ensure that the amount received by the Agent on such date is the amount in the Judgment Currency which when converted at the rate of exchange prevailing on the date of receipt by the Agent is the amount then due under this Agreement or such other Loan Document in the Currency Due. If the amount of the Currency Due which the Agent is so able to purchase is less than the amount of the Currency Due originally due to it, the Borrower shall indemnify and save the Agent and the Lenders harmless from and against all loss or damage arising as a result of such deficiency. This indemnity shall constitute an obligation separate and independent from the other obligations contained in this Agreement and the other Loan Documents, shall give rise to a separate and independent cause of action, shall apply irrespective of any indulgence granted by the Agent from time to time and shall continue in full force and effect notwithstanding any judgment or order for a liquidated sum in respect of an amount due under this Agreement or any other Loan Document or under any judgment or order.

2.17 Collection of Accounts.

(a) Each Credit Party shall, and shall cause each other Credit Party to, at its expense, enforce, collect and receive all amounts owing on its Accounts in the ordinary course of its business and any proceeds it so receives shall be subject to the terms hereof. Any proceeds received by a Credit Party in respect of Accounts, and any cheques, cash, credit card sales and receipts, notes or other instruments or property received by a Credit Party with respect to any Collateral, shall be held by such Credit Party in trust or as mandatary for the Agent, separate from such Credit Party’s own property and funds, and promptly turned over to the Agent with proper assignments or endorsements by deposit to the Blocked Accounts.

(b) Each Credit Party shall, and shall cause each other Credit Party to: (i) irrevocably authorize and direct any bank which maintains any Credit Party’s initial receipt of cash, cheques and other items to promptly wire transfer all available funds to a Blocked Account; and

00000000.7

(ii) advise all such banks of the Agent’s security interest in such funds. The Borrower shall, and shall cause each other Credit Party to, provide the Agent with prior written notice of any and all deposit accounts opened or to be opened subsequent to the Effective Date. All amounts received by the Agent in payment of Accounts will be credited to the Blocked Account when the Agent is advised by its bank of its receipt of “collected funds” at the Agent’s bank account in Toronto, Ontario on the Business Day of such advise if advised no later than 12:00 noon, Toronto time, or on the next succeeding Business Day if so advised after 12:00 noon, Toronto time. No cheques, drafts or other instrument received by the Agent shall constitute final payment to the Agent unless and until such instruments have actually been collected.

(c) At the request of the Agent, the Borrower shall, and shall cause each Credit Party to: (i) indicate on all of its invoices that funds should be delivered to and deposited in a lock box or a Blocked Account, as applicable; and (ii) direct all of its account debtors to deposit any and all proceeds of Collateral into the lock boxes or the Blocked Accounts, as applicable.

(d) Each Credit Party shall, and shall cause each other Credit Party to, establish and maintain, in its own respective name and at its expense, deposit accounts and lock boxes with such banks as are acceptable to the Agent (the “Blocked Accounts”) into which the Borrower shall promptly cause to be deposited: (i) all proceeds of Collateral received by any Credit Party, including all amounts payable to any Credit Party from credit card issuers and credit card processors, and (ii) all amounts on deposit in deposit accounts used by any Credit Party at each of its locations, all as further provided in Section 2.17(b). The banks at which the Blocked Accounts are established and the applicable Credit Parties shall enter into agreements, in form and substance satisfactory to the Agent (the “Blocked Account Agreements”), providing that, among other things, all cash, cheques and items received or deposited in the Blocked Accounts are subject to Liens in favour of the Agent, that the depository bank has no Lien upon, or right of set off against, the Blocked Accounts and any cash, cheques, items, wires or other funds from time to time on deposit therein, except as otherwise provided in the Blocked Account Agreements, and that on a daily basis the depository bank will wire, or otherwise transfer, in immediately available funds, all funds received or deposited into the Blocked Accounts to such bank account as the Agent may from time to time designate for such purpose. The Borrower hereby confirms and agrees that all amounts deposited in such Blocked Accounts and any other funds received and collected by the Agent, whether as proceeds of Inventory or other Collateral or otherwise, shall be subject to the Liens in favour of the Agent.

(e) The parties hereto hereby acknowledge, confirm and agree that the implementation of the cash management arrangements is a contractual right provided to the Agent and the Lenders hereunder in order for the Agent and the Lenders to manage and monitor their collateral position and not a proceeding for enforcement or recovery of a claim, or pursuant to, or an enforcement of, any security or remedies whatsoever, that the cash management arrangements contemplated herein are critical to the structure of the lending arrangements contemplated herein, that the Lenders are relying on the Borrower’s acknowledgement, confirmation and agreement with respect to such cash management arrangements in making accommodations of credit available to the Borrower and in particular that any accommodations of credit are being provided by the Lenders to the Borrower strictly on the basis of a borrowing base calculation to fully support and collateralize any such accommodations of credit hereunder.

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2.18 Letters of Credit. In order to assist the Borrower in establishing Letters of Credit with the Issuing Bank, the Borrower has requested the Agent and the Agent has agreed to execute a Letter of Credit Guarantee subject to the following terms and conditions:

(a) Within the limits of the Commitments and the Borrowing Base, and the other limitations contained in this Agreement, the Agent shall assist the Borrower in obtaining Letters of Credit, denominated in Canadian Dollars or U.S. Dollars, in an amount not to exceed the outstanding amount of the Letter of Credit Sub-Line. The Agent’s assistance for amounts in excess of the limitation set forth herein shall at all times and in all respects be in the Agent’s sole discretion. It is understood that the term, form and purpose of each Letter of Credit and all documentation in connection therewith, and any amendments, modifications or extensions thereof, must be mutually acceptable to the Agent, the Issuing Bank and the Borrower.

(b) The Agent shall have the right, without notice to the Borrower, to charge the Borrower’s loan account with the amount of any and all indebtedness, liability or obligation of any kind incurred by the Agent under the Letter of Credit Guarantees at the earlier of (a) payment by the Agent under the Letter of Credit Guarantee; or (b) the occurrence and continuance of an Event of Default, unless the Borrower has provided Cover to the Agent in an amount equal to the face amount of such Letter of Credit Guarantees. Any amount so charged to the Borrower’s loan account shall be deemed a Canadian Prime Rate Loan or a US Base Rate Loan hereunder, depending on the currency of the Borrower’s payment obligation thereunder, and shall incur interest at the rate provided in Section 2.5.

(c) The Borrower unconditionally indemnifies the Agent and holds the Agent harmless from any and all loss, claim or liability incurred by the Agent arising from any transactions or occurrences relating to Letters of Credit established or opened for the Borrower’s account, the collateral relating thereto and any drafts or acceptances thereunder, and all Obligations thereunder, including any such loss or claim due to any errors, omissions, negligence, misconduct or action taken by any Issuing Bank, other than for any such loss, claim or liability arising out of the gross negligence or willful misconduct by the Agent under the Letter of Credit Guarantee. This indemnity shall survive termination of this Agreement. The Borrower agrees that any charges incurred by the Agent for the Borrower’s account from the Issuing Bank shall be conclusive upon the Agent and may be charged to the Borrower’s loan account.

(d) The Agent shall not be responsible for: (a) the existence, character, quality, quantity, condition, packing, value or delivery of the goods purporting to be represented by any documents; (b) any difference or variation in the character, quality, quantity, condition, packing, value or delivery of the goods from that expressed in the documents; (c) the validity, sufficiency or genuineness of any documents or of any endorsements thereon, even if such documents should in fact prove to be in any or all respects invalid, insufficient, fraudulent or forged; (d) the time, place, manner or order in which shipment is made; partial or incomplete shipment, or failure or omission to ship any or all of the goods referred to in the Letters of Credit or documents; (e) any deviation from instructions; (f) delay, default, or fraud by the shipper and/or anyone else in connection with the goods or the shipping thereof; or (g) any breach of contract between the shipper or vendors and the Borrower.

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(e) Each of the Credit Parties agrees that any action taken by the Agent, if taken in good faith, or any action taken by any Issuing Bank, under or in connection with the Letters of Credit, the Letter of Credit Guarantees, the drafts or acceptances, or the Collateral, shall be binding on the Credit Parties and shall not result in any liability whatsoever of the Agent to any Credit Party. In furtherance thereof, the Agent shall have the full right and authority to: (a) clear and resolve any questions of non compliance of documents; (b) give any instructions as to acceptance or rejection of any documents or goods; (c) execute any and all steamship or airways guarantees (and applications therefor), indemnities or delivery orders; (d) grant any extensions of the maturity of, time of payment for, or time of presentation of, any drafts, acceptances, or documents; and (e) agree to any amendments, renewals, extensions, modifications, changes or cancellations of any of the terms or conditions of any of the applications, Letters of Credit, drafts or acceptances or Letters of Credit Guarantees; all in the Agent’s sole discretion. The Issuing Bank shall be entitled to comply with and honor any and all such documents or instruments executed by or received solely from the Agent, all without any consent from any Credit Party. In addition, without the Agent’s express consent and endorsement in writing, each of the Credit Parties agrees: (a) not to (i) execute any applications for steamship or airway guarantees, indemnities or delivery orders; (ii) grant any extensions of the maturity of, time of payment for, or time of presentation of, any drafts, acceptances or documents; or (iii) agree to any amendments, renewals, extensions, modifications, changes or cancellations of any of the terms or conditions of any of the applications, Letters of Credit, drafts or acceptances or Letters of Credit Guarantees; and (b) upon the occurrence and during the continuance of an Event of Default, not to (i) clear and resolve any questions of non compliance of documents, or (ii) give any instructions as to acceptances or rejection of any documents or goods.

(f) Each of the Credit Parties shall, and shall cause each other Credit Party to: (a) procure any necessary import, export or other licenses or certificates for the import or handling of the Collateral; (b) comply with all Applicable Law in regard to the shipment and importation of the Collateral, or the financing thereof; and (c) deliver to the Agent any certificates in that regard that the Agent may at any time request to be furnished. In connection herewith, the Borrower warrants and represents that all shipments made under any such Letters of Credit are in accordance with Applicable Law of the countries in which the shipments originate and terminate, and are not prohibited by any such Applicable Law. Each of the Credit Parties assumes all risk, liability and responsibility for, and agrees to pay and discharge, all present and future local, provincial, state, federal or foreign Taxes, duties, or levies with respect to such Collateral. Any embargo, restriction, laws, customs or regulations of any country, state, city, or other political subdivision, where the Collateral is or may be located, or wherein payments are to be made, or wherein drafts may be drawn, negotiated, accepted, or paid, shall be solely the Borrower’s risk, liability and responsibility.

(g) Upon any payments made to the Issuing Bank under the Letter of Credit Guarantee, the Agent shall acquire by subrogation, any rights, remedies, duties or obligations granted or undertaken by the Borrower to the Issuing Bank in any application for Letters of Credit, any standing agreement relating to Letters of Credit or otherwise, all of which shall be deemed to have been granted to the Agent and apply in all respects to the Agent and shall be in addition to any rights, remedies, duties or obligations contained herein.

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2.19 Conversion to DIP Facility. Upon the occurrence of a Restructuring Event, and provided that such Restructuring Event shall include the following steps (each of which shall be in form and substance satisfactory to the Lenders), the Credit shall be converted into a debtor-in-possession financing arrangement:

(a) a court of competent jurisdiction shall have issued an initial order under the CCAA (the “Initial Order”), which order shall be approved by the Lenders and shall include:

(i)	provisions approving this Agreement and all other Loan Documents, together with such other documents as the Lenders deem necessary or appropriate;

(ii)

provisions granting to the Lenders, as security for the Obligations, Liens on all present and future assets of the Credit Parties having the priority as set out under Section 2.20 (the “DIP Charge”) with such DIP Charge (together with the existing Liens in favour of the Collateral Trustee) explicitly having priority over all present and future Liens other than a Lien for administrative expenses in scope and quantum acceptable to the Lenders (the “Administrative Charge”);

(iii)

provisions confirming that, subject to Section 2.19(a)(ii), the priorities of the Lenders and New Noteholders under the DIP Charge are as set forth under Section 2.20.

(iv)	provisions confirming that the DIP Charge is in addition to and without prejudice to the existing Liens in favour of the Collateral Agent and that all Obligations will be secured by the existing Liens in favour of the Collateral Agent as well as by the DIP Charge;

(v)

provisions declaring that the granting of the DIP Charge and all other documents executed and delivered to the Lenders as contemplated herein, including all actions taken to perfect, record and register the DIP Charge, do not constitute conduct meriting an oppression remedy, settlements, fraudulent preferences, fraudulent conveyances or other challengeable or reviewable transactions under any applicable laws;

(vi)	provisions restricting the granting of any additional Liens on the assets of the Credit Parties other than the Directors’ Charge;

(vii)

provisions appointing FTI Consulting as Monitor, or such other Monitor that is acceptable to the Lenders;

(viii)

provisions ordering and declaring the Lenders to be treated as unaffected creditors in any CCAA plan of arrangement and providing that the stay of proceedings under the Initial Order shall not apply to the Lenders and their rights under this Agreement or any other Loan Documents (including the existing Liens in favour of the Collateral Agent); and

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(ix)	provisions providing the Lenders and their advisors clear and unfettered access to the books and records of the Credit Parties and such other information as the Credit Parties deem necessary or appropriate; and

(b) the execution and delivery by the Credit Parties of any additional legal documentation deemed necessary or appropriate by the Lenders.

2.20 Priorities. The obligations of the Credit Parties under this Agreement shall be secured by a first priority Lien on the CIT Priority Collateral and a second priority Lien on the Noteholder Priority Collateral. The obligations of the Credit Parties under the New Notes shall be secured by a first priority Lien on the Noteholder Priority Collateral and a second priority Lien on the CIT Priority Collateral. Certain obligations of the Credit Parties to The Bank of Nova Scotia in respect of cash management services and letters of credit shall be secured by the BNS Priority Collateral.

ARTICLE 3

REPRESENTATIONS AND WARRANTIES

In order to induce the Agent and the Lenders to enter into this Agreement, to make any Loans hereunder and to issue any Letters of Credit hereunder, each Credit Party hereby represents and warrants to the Agent and each Lender that each statement set forth in this Article 3 is true and correct on the date hereof, and will be true and correct on the date of each Borrowing, on the date each Letter of Credit is requested hereunder and on the date each Letter of Credit is issued hereunder:

3.1 Organization; Powers. The Borrower and each other Credit Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now and formerly conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.

3.2 Authorization; Enforceability. The Transactions are within each Credit Party’s corporate powers and have been duly authorized by all necessary corporate and, if required, shareholder action. This Agreement and the other Loan Documents have been duly executed and delivered by the Borrower and each other Credit Party thereto and constitute legal, valid and binding obligations of the Borrower and each other Credit Party thereto, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganisation, moratorium or other Applicable Law affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

3.3 Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except as disclosed in Schedule 3.3, (b) will not violate any Applicable Law or the charter, by-laws or other organizational documents of the Borrower or any other Credit Party or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture, agreement or other instrument binding upon the Borrower or any other Credit Party or

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their respective assets, or give rise to a right thereunder to require any payment to be made by the Borrower or any other Credit Party, and (d) will not result in the creation or imposition of any Lien on any asset of the Borrower or any other Credit Party, except for any Lien arising in favour of the Agent, for the benefit of the Lenders, under the Loan Documents.

3.4 Financial Condition; No Material Adverse Effect.

(a) The Borrower has furnished to the Lenders its consolidated balance sheets and statements of income, retained earnings and changes in financial position (i) as of and for the Fiscal Years ended August 31, 2006, August 31, 2007 and August 31, 2008, reported on by its auditors, and (ii) as of and for the fiscal month and the portion of the Fiscal Year ended February 28, 2009, certified by a Responsible Officer. Such financial statements present fairly, in all material respects, the consolidated financial position and results of operations and cash flows of the Borrower as of such dates and for such periods in accordance with GAAP, subject to year end audit adjustments and the absence of footnotes in the case of the statements referred to in clause (ii) above.

(b) All information (including that disclosed in all financial statements) pertaining to the Borrower and the other Credit Parties (other than projections) (in this Section 3.4(c), the “Information”) that has been or will be made available to the Lenders, or the Agent by the Borrower or any representative of the Borrower and the other Credit Parties, taken as a whole, is or will be, when furnished, complete and correct in all material respects and does not or will not, when furnished, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made. The projections that have been or will be made available to the Lenders, or the Agent by the Borrower or any representative of the Borrower have been or will be prepared in good faith based upon reasonable assumptions.

(c) The Borrower has delivered to the Lenders a weekly cash flow forecast for the period ending December 31, 2009. Such weekly cash flow forecast has been prepared in good faith by the Borrower, are based on assumptions which are believed by the Borrower on the date hereof and on the Effective Date to be reasonable, are based on the best information available to the Borrower as of the date of delivery thereof.

3.5 Litigation. Except with respect to the CCAA Proceedings and litigation that is stayed by the commencement of the CCAA Proceedings or as otherwise disclosed in Schedule 3.5, there are no actions, suits, counterclaims or proceedings (including any Tax-related matter) by any Person or investigation by any Governmental Authority pending against or, to the knowledge of the Borrower, threatened against or affecting the Borrower or any of the other Credit Parties (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters), or (ii) that involve this Agreement, any other Loan Document, or the Transactions. Since the date of this Agreement, there has been no change in the status of the Disclosed Matters that, individually or in the aggregate, has resulted in, or could reasonably be expected to have, a Material Adverse Effect.

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3.6 Compliance with Applicable Laws and Agreements. The Borrower and each other Credit Party is in compliance with all Applicable Laws applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect and except with respect to the Existing Notes. Neither the Borrower nor any other Credit Party has violated or failed to obtain any Authorization necessary to the ownership of any of its property or assets or the conduct of its business, which violation or failure could reasonably be expected to have (in the event that such a violation or failure were asserted by any Person through appropriate action) a Material Adverse Effect.

3.7 Professional Retainers. The Borrower has delivered to the Agent a true and complete list of (i) all retainers for professionals and advisors engaged by the Borrower or any Guarantor as of the date hereof with respect to the proposed CCAA Proceedings, together with the fees payable pursuant to such retainers, and (ii) all of the Borrowers’ and Guarantors’ (and their Subsidiaries’) existing directors’ and officers’ insurance; and there are no directors or employees trusts that have been established by any Issuer or Guarantor (or any of their Subsidiaries). Except as otherwise disclosed in writing to the Agent, the Credit Parties have not established a “key employee retention program” in connection with its current restructuring process.

3.8 Taxes. The Borrower and each other Credit Party has timely filed or caused to be filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it (including all instalments with respect to the current period) and has made adequate provision for Taxes for the current period, except Taxes that are being contested in good faith by appropriate proceedings and for which the Borrower or such other Credit Party, as applicable, has set aside on its books adequate reserves.

3.9 Titles to Real Property. The Borrower and each other Credit Party have fee simple title to their respective owned real properties (or in Quebec, immoveable properties), and with respect to leased real properties, title to the leasehold estate with respect thereto, pursuant to valid and enforceable leases, free and clear of all Liens except Permitted Liens, including the Liens disclosed to the Lenders in Schedule 3.9.

3.10 Titles to Personal Property. The Borrower and each other Credit Party have title to their respective owned moveable properties, and with respect to leased moveable properties, title to the leasehold estate with respect thereto, pursuant to valid and enforceable leases, free and clear of all Liens except Permitted Liens, including the Liens disclosed in Schedule 3.10.

3.11 Pension Plans. The Pension Plans and any benefit plans sponsored, maintained or contributed by any Credit Party or any Affiliate are, with the exception of a supplemental retirement plan for eligible employees (such supplemental retirement plan not being intended to be subject to, and is not subject to, pension benefits standards legislation), duly registered under the ITA (where required) and any other Applicable Laws which require registration, have been administered in accordance with the ITA and such other Applicable Laws and no event has occurred which could reasonably be expected to cause the loss of such registered status, except to the extent that any failure to do so could not reasonably be expected to have a Material Adverse Effect. All material obligations of the Borrower and each other Credit Party (including fiduciary, funding, investment and administration obligations) required to be performed in

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connection with the Pension Plans and other benefit plans and the funding agreements therefor have been performed on a timely basis, except to the extent that any failure to do so could not reasonably be expected to have a Material Adverse Effect. There are no outstanding disputes concerning the assets of the Pension Plans or any benefit plans. No promises of benefit improvements under the Pension Plans or any benefit plans have been made except where such improvement could not reasonably be expected to have a Material Adverse Effect. All employer and employee payments, contributions (including “normal cost”, “special payments” and any other payments in respect of any funding deficiencies or shortfalls) or premiums required to be withheld, made, remitted or paid to or in respect of each Pension Plan or benefit plan and all other amounts that are due to the pension fund of a Pension Plan from a Credit Party or an Affiliate have been withheld, made, remitted or paid on a timely basis in accordance with the terms of such plans, any applicable collective bargaining agreement or employment contract and all Applicable Laws. Any assessments owed to the Pension Benefits Guarantee Fund established under the Pension Benefits Act (Ontario), or other assessments or payments required under similar legislation in any other jurisdiction, have been paid when due. There have been no improper withdrawals or applications of the assets of the Pension Plans or any benefit plans. For any Pension Plan which is a defined benefit plan (“Defined Benefit Plan”) of the Borrower or any Subsidiary, the most recent actuarial valuations prepared for funding purposes in respect thereof have been made available to the Agent. Except as disclosed in Schedule 3.11, no events have occurred which could give rise to a partial or full termination of any Pension Plan which would have a Material Adverse Effect and there is no non-registered Pension Plan in respect of which an event has occurred that could require immediate or accelerated funding in respect of unfunded liabilities or other deficit amounts which would have a Material Adverse Effect. Except as disclosed in Schedule 3.11, as of the date hereof, each of the Pension Plans is fully funded on a solvency, going concern and wind-up basis (using actuarial methods and assumptions which are consistent with the valuations last filed with the applicable Governmental Authorities and in accordance with Canadian generally accepted actuarial practice). Subject to the matters disclosed in Schedule 3.11, no material changes have occurred (other than to the value of plan assets as a direct result of the return on plan investments due to current economic markets where such investments were made in accordance with Applicable Laws and the relevant statement of investment policies and procedures for such plan) in respect of any Defined Benefit Plan or non-pension post-retirement benefit plan since the date of the most recently completed actuarial valuations which could reasonably be expected to have a Material Adverse Effect. None of the Borrower, or any Credit Party or any of their respective Affiliates is subject to the United States Employee Retirement Income Security Act of 1974, as amended.

3.12 Disclosure. The Borrower has disclosed to the Lenders all agreements, instruments and corporate or other restrictions to which it or any other Credit Party is subject, and all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. None of the representations or warranties made by any Credit Party in the Loan Documents as of the date such representations and warranties are made or deemed made, and none of the statements contained in any exhibit, report, statement or certificate furnished by or on behalf of any Credit Party in connection with the Loan Documents, contains any untrue statement of a material fact or omits any material fact necessary to be stated therein to make the statements made therein, in light of the circumstances under which they are made, not misleading as of the time when made or delivered.

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3.13 Defaults. Neither the Borrower nor any other Credit Party is in default nor has any event or circumstance occurred which, but for the passage of time or the giving of notice, or both, would constitute a default (in any respect that would have a Material Adverse Effect) under any loan or credit agreement, indenture, mortgage, deed of trust, security agreement or other instrument or agreement evidencing or pertaining to any Indebtedness of or Lien against the Borrower or any other Credit Party, or under any material agreement or instrument to which the Borrower or any other Credit Party is a party or by which the Borrower or any other Credit Party is bound, except with respect to the Existing Notes and as otherwise disclosed to the Lenders in Schedule 3.13. No Default has occurred and is continuing.

3.14 Casualties; Taking of Properties. Since August 31, 2008, neither the business nor the properties of the Borrower or any other Credit Party have been affected in a manner that has had, or could reasonably be expected to have, a Material Adverse Effect as a result of any fire, explosion, earthquake, flood, drought, windstorm, accident, strike or other labour disturbance, embargo, requisition or taking of property or cancellation of contracts, permits or concessions by any domestic or foreign Governmental Authority, riot, activities of armed forces, or acts of God or of any public enemy.

3.15 Subsidiaries. As of the Effective Date, Schedule 3.15 correctly sets forth the (i) names, (ii) form of legal entity, (iii) Equity Securities issued and outstanding, (iv) Equity Securities owned by each Credit Party or a Subsidiary of such Credit Party (and specifying such owner), and (v) jurisdictions of organization of all Credit Parties and their Subsidiaries. Except as described in Schedule 3.15, as of the Effective Date, the Credit Parties directly or indirectly do not own any Equity Securities or debt security which is convertible, or exchangeable, for Equity Securities of any other Person. Unless otherwise indicated in Schedule 3.15, as of the Effective Date, all of the outstanding Equity Securities of each Credit Party is directly or indirectly owned of record and beneficially by the Borrower, there are no outstanding options, warrants or other rights to purchase Equity Securities of any such Credit Party, and all such Equity Securities so owned are duly authorized, validly issued, fully paid and non-assessable, and were issued in compliance with all applicable federal, provincial or foreign securities and other Applicable Laws, and are free and clear of all Liens, except for Permitted Liens. Except in respect of Foxsports World Canada and Canwest Television Limited Partnership, none of the terms of any Equity Securities in any partnership or limited liability company that form part of the Collateral provide that such Equity Securities are a “security” for the purposes of the STA. Schedule 3.15 also lists those Subsidiaries, the Equity Securities of which have not been pledged to the Collateral Agent as at the Effective Date.

3.16 Insurance. All policies of fire, liability, workers’ compensation, casualty, flood, business interruption and other forms of insurance owned or held by the Borrower or any other Credit Party are (a) sufficient for compliance with all requirements of Applicable Law and of all agreements to which the Borrower or any other Credit Party is a party, (b) are valid, outstanding and enforceable policies, (c) provide adequate insurance coverage in at least such amounts and against at least such risks (but including in any event public liability) as are usually insured against in the same general area by Persons engaged in the same or a similar business to the assets and operations of the Borrower and each other Credit Party, and (d) will not in any way be adversely affected by, or terminate or lapse by reason of, the Transactions. All such material

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policies are in full force and effect, all premiums with respect thereto have been paid in accordance with their respective terms, and no notice of cancellation or termination has been received with respect to any such policy. Neither the Borrower nor any other Credit Party maintains any formalized self-insurance program with respect to its assets or operations or material risks with respect thereto. The certificate of insurance delivered to the Agent pursuant to Section 4.1(f) contains an accurate and complete description of all material policies of insurance owned or held by the Borrower and each other Credit Party on the Effective Date.

3.17 Management Payments. All payments to management and senior executives of the Credit Parties, including salary and pension payments, and all bonus payments contractually required to be paid to any management and senior executives of the Credit Parties are contemplated in the Weekly Cash Flow Projection most recently provided to the Agent.

3.18 Material Contracts. Schedule C sets out all Material Contracts as of the Effective Date. A true and complete copy of each Material Contract has been delivered to the Agent as of the Effective Date. Each of the Material Contracts is in full force and effect. Except in respect of the Existing Notes as disclosed in Schedule 3.13, neither the Borrower nor any other Credit Party is in default under or in breach of any term or condition of any Material Contract that would have, either individually or in the aggregate, a Material Adverse Effect, nor is the Borrower or any other Credit Party aware of any material default under or material breach of any term or condition of any Material Contract by any other party thereto. No contract to which the Borrower or any other Credit Party is a party contains any material provisions which impose burdensome or onerous obligations on the Borrower or such other Credit Party which are inconsistent with prudent commercial activity by the Borrower or such other Credit Party. Each agreement relating to television programming for the 2008-2009 season is in full force and effect and such agreement, in aggregate, provide sufficient programming to cover substantially the programming requirements for the balance of such season.

3.19 Environmental Matters. Except as disclosed to the Lenders in the Disclosed Matters:

(a) Environmental Laws. Neither any property of the Borrower or any other Credit Party nor the operations conducted thereon violate any applicable order of any court or Governmental Authority or any Environmental Laws, which violation could reasonably be expected to result in remedial obligations having a Material Adverse Effect, assuming disclosure to the applicable Governmental Authority of all material relevant facts, conditions and circumstances, if any, pertaining to the relevant property.

(b) Notices and Permits. All notices, permits, licenses or similar authorizations, if any, required to be obtained or filed by the Borrower or any other Credit Party in connection with the operation or use of any and all property of the Borrower or any other Credit Party, including but not limited to past or present treatment, transportation, storage, disposal or Release of Hazardous Materials into the environment, have been duly obtained or filed, except to the extent the failure to obtain or file such notices, permits, licenses or similar authorizations could not reasonably be expected to have a Material Adverse Effect, or which could not reasonably be expected to result in remedial obligations having a Material Adverse Effect, assuming disclosure to the applicable Governmental Authority of all material relevant facts, conditions and circumstances, if any, pertaining to the relevant property.

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(c) Hazardous Substances Carriers. All Hazardous Materials generated at any and all property of the Borrower or any other Credit Party have been treated, transported, stored and disposed of only in accordance with all Environmental Laws applicable to them, except to the extent the failure to have such Hazardous Materials transported, treated or disposed by such carriers could not reasonably be expected to have a Material Adverse Effect, and only at treatment, storage and disposal facilities maintaining valid permits under applicable Environmental Laws, which carriers and facilities have been and are operating in compliance with such permits, except to the extent the failure to have such Hazardous Materials treated, transported, stored or disposed at such facilities, or the failure of such carriers or facilities to so operate, could not reasonably be expected to have a Material Adverse Effect or which could not reasonably be expected to result in remedial obligations having a Material Adverse Effect, assuming disclosure to the applicable Governmental Authority of all material relevant facts, conditions and circumstances, if any, pertaining to the relevant property.

(d) Hazardous Materials Disposal. The Borrower and the other Credit Parties have taken all reasonable steps necessary to determine and have determined that no Hazardous Materials have been disposed of or otherwise released and there has been no threatened Release of any Hazardous Materials on or to any property of the Borrower or any other Credit Party other than in compliance with Environmental Laws, except to the extent the failure to do so could not reasonably be expected to have a Material Adverse Effect or which could not reasonably be expected to result in remedial obligations having a Material Adverse Effect, assuming disclosure to the applicable Governmental Authority of all material relevant facts, conditions and circumstances, if any, pertaining to the relevant property.

(e) No Contingent Liability. The Borrower and the other Credit Parties have no material contingent liability in connection with any Release or threatened Release of any Hazardous Materials into the environment other than such contingent liabilities at any one time and from time to time which could reasonably be expected to exceed $250,000 and for which adequate reserves for the payment thereof as required by GAAP have been provided, or which could reasonably be expected to result in remedial obligations having a Material Adverse Effect, assuming disclosure to the applicable Governmental Authority of all relevant facts, conditions and circumstances, if any, pertaining to such Release or threatened Release.

3.20 Employee Matters. Except as set forth on Schedule 3.20, as of the Effective Date, none of the Borrower or any of the other Credit Parties, nor any of their respective employees, is subject to any collective bargaining agreement. There are no strikes, slowdowns, work stoppages or controversies pending or, to the best knowledge of the Borrower, threatened against the Borrower or any other Credit Party, or their respective employees, which could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect. Except as set forth in Schedule 3.20 or as otherwise disclosed to the Agent in writing, as of the Effective Date, none of the Borrower nor any other Credit Party is subject to an employment contract providing for special payments on termination of employment (it being agreed by the Borrower that any such payments which are projected to be made will be included in the Weekly Cash Flow Forecast before they are made). Each of the Borrower and the other Credit Parties has withheld from each payment to each of their respective officers, directors and employees the amount of all Taxes, including income tax, Canada pension plan, employment insurance and

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other payments and deductions required to be withheld therefrom, and has paid the same to the proper taxation or other receiving authority in accordance with Applicable Law. None of the Borrower nor any other Credit Party is subject to any claim by or liability to any of their respective officers, directors or employees for salary (including vacation pay) or benefits which would rank in whole or in part pari passu with or prior to the Liens created by the Security Documents, other than Permitted Liens to the extent reserved for as Priority Payables of any Credit Party.

3.21 Fiscal Year. The Fiscal Year of each Credit Party ends on August 31 of each calendar year.

3.22 Intellectual Property Rights. The Borrower and each Credit Party is the licensee of or registered and beneficial owner of, with good and marketable title, free of all Liens other than Permitted Liens, to all patents, patent applications, trade marks, trade xxxx applications, trade names, service marks, copyrights, industrial designs, integrated circuit topographies, or other rights with respect to the foregoing and other similar property, used in or necessary for the present and planned future conduct of its business, without any conflict with the rights of any other Person, other than as listed on Schedule 3.22, or other than for such conflicts as could not reasonably be expected to have a Material Adverse Effect. All material patents, trade marks, trade names, service marks, copyrights, industrial designs, integrated circuit topographies, and other similar rights owned or licensed by the Borrower or any other Credit Party, and all rights of the Borrower and each other Credit Party to the use of any patents, trade marks, trade names, service marks, copyrights, industrial designs, integrated circuit topographies, or other similar rights, are described in Schedule 3.22 (collectively, the “Intellectual Property Rights”). Except as set forth in Schedule 3.22, no material claim has been asserted and is pending by any Person with respect to the use by the Borrower or any other Credit Party of any intellectual property or challenging or questioning the validity, enforceability or effectiveness of any intellectual property necessary for the conduct of the business of the Borrower or any other Credit Party. Except as disclosed in Schedule 3.22 or except as could not reasonably be expected to have a Material Adverse Effect, (i) the Borrower and each other Credit Party has the exclusive right to use the intellectual property which the Borrower (or each other Credit Party) owns, (ii) all applications and registrations for such owned intellectual property are current, and (iii) to the knowledge of the Borrower and the other Credit Parties, the conduct of the Borrower’s and each other Credit Party’s business does not infringe the intellectual property rights of any other Person.

3.23 Residency of Borrower for Tax Purposes. The Borrower is a resident of Canada for tax purposes.

3.24 Restricted Payments. No Restricted Payment has been declared, paid, or made upon or in respect of Equity Securities of any Credit Party except as expressly permitted hereby.

3.25 Debt. None of the Credit Parties has any Indebtedness except (a) the Obligations, (b) the Indebtedness set forth in the most recent financial statements delivered to the Agent, or the notes thereto, (c) Tax obligations (including deferred Taxes), trade payables and other contractual obligations arising in the ordinary course of business as carried on by the Credit Parties since the date of such financial statements, and (d) Indebtedness created in accordance with Section 6.1.

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3.26 Workers’ Compensation. None of the Credit Parties has any unpaid workers’ compensation or like obligations except as are being incurred, and paid on a current basis in the ordinary course of business, and there are no proceedings, claims, actions, orders or investigations of any Governmental Authority relating to workers’ compensation outstanding, pending or, to their knowledge, threatened relating to them or any of their employees or former employees which could reasonably be expected to have a Material Adverse Effect.

3.27 Bank Accounts; Securities Accounts; Futures Accounts. Schedule 3.27 contains a complete and accurate list of all bank accounts maintained by the Credit Parties with any bank or other financial institution as of the Effective Date. No Credit Party maintains any Securities Accounts or Futures Accounts.

3.28 Real Property and Leases. Schedule 3.28 hereto is a correct and complete list of all real property owned by each Credit Party, all leases and subleases of real property by any Credit Party, as lessee or sublessee, and all leases and subleases of real property by any Credit Party, as lessor or sublessor. Each of such leases and subleases is valid and enforceable in accordance with its terms and is in full force and effect, and no material default by any party to any such lease or sublease exists, in each case except to the extent any failure to be in full force and effect and/or the existence of any breaches could not reasonably be expected to have a Material Adverse Effect.

3.29 Further Real Property Matters.

(a) Except as advised in writing to the Agent, no investigation or proceeding of any Governmental Authority is pending in respect of real property owned by any of the Credit Parties. No material part of any such real property has been condemned, taken or expropriated by any Governmental Authority, federal, state, provincial, municipal or any other competent authority.

(b) Except as advised in writing to the Agent, all present uses in respect of any real property of the Credit Parties may lawfully be continued and all permitted uses are satisfactory for the Credit Parties’ current and intended purposes, in each case except to the extent any non-compliance with laws and/or the existence of an unsatisfactory use could not reasonably be expected to have a Material Adverse Effect.

(c) No Eligible Equipment is located at any leased real property of the Credit Parties except as indicated in Schedule 3.28.

3.30 Priorities; Jurisdictions of Credit Parties; List of Security Documents; Broadcast Permits. The Obligations shall be secured by Liens having the priorities set forth in Section 2.20. Schedule 3.30 sets out (i) the various jurisdictions in which the Borrower and each other Credit Party carries on business or has tangible assets having an aggregate value in excess of Cdn.$100,000, (ii) as of the Effective Date, all agreements, documents or instruments that have been executed and delivered by any Credit Party or any other Person to the Collateral Agent as security for the payment or performance of, among other things, the Obligations, and (iii) a correct and complete list of all licenses, permits and privileges issued or granted by the Canadian Radio-television and Telecommunications Commission pursuant to the Broadcasting Act

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(Canada) to, or otherwise held by, a Credit Party (collectively, the “Broadcast Permits”). None of the Broadcast Permits have been issued or granted to, or otherwise held by, any Credit Party that is domiciled in, or was formed or created under, the laws of the Province of Quebec.

ARTICLE 4

CONDITIONS

4.1 Effective Date. The obligations of the Lenders to make any Loan or provide a Letter of Credit Guarantee shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.2):

(a) Credit Agreement. The Agent (or its counsel), each Lender, and the Issuing Bank shall have received from each party hereto either (i) a counterpart of this Agreement signed on behalf of each party hereto, or (ii) written evidence satisfactory to the Agent (which may include facsimile transmission of a signed signature page of this Agreement) that each such party has signed a counterpart of this Agreement.

(b) Legal Opinions. The Agent shall have received a favourable written opinion of counsel to the Borrower and the Credit Parties, substantially in the form of Exhibit D, and covering such other matters relating to the Borrower, the Credit Parties, this Agreement, the other Loan Documents, or the Transactions as the Lenders shall reasonably request (together with copies of all factual certificates and legal opinions delivered to such counsel in connection with such opinion upon which counsel has relied). The Agent shall also have received favourable written opinions of such special and local counsel within and outside Canada as may be required by the Agent (together with copies of all factual certificates and legal opinions delivered to such counsel in connection with such opinion upon which such counsel has relied). The Borrower hereby requests each such counsel to deliver such opinions and supporting materials. All opinions and certificates referred to in this Section 4.1(b) shall be addressed to the Agent and the Lenders and dated the Effective Date.

(i)

certified copies of the resolutions of the Board of Directors of the Borrower and any other Credit Party which is a party to any Loan Document, dated as of the Effective Date, and approving, as appropriate, the Loans, this Agreement and the other Loan Documents, and all other documents, if any, to which the Borrower or such other Credit Party is a party and evidencing corporate or similar authorization with respect to such documents;

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(ii)

a certificate of the Secretary or an Assistant Secretary of the Borrower, and any other Credit Party which is a party to any Loan Document, dated as of the Effective Date, and certifying (A) the name, title and true signature of each officer of such Person authorized to execute this Agreement and the other Loan Documents to which it is a party, (B) the name, title and true signature of each officer of such Person authorized to provide the certifications required pursuant to this Agreement, including certifications required pursuant to Section 5.1 and Borrowing Requests, and (C) that attached thereto is a true and complete copy of the articles of incorporation or comparable constating documents and bylaws of the Borrower, and any other Credit Party which is a party to any Loan Document, as amended to date, and a recent certificate of status, certificate of compliance, good standing certificate or analogous certificate; and

(iii)

a certificate of the Chief Financial Officer or Senior Financial Officer of each of Canwest Finance Inc./Financiere Canwest Inc. and Canwest Global Broadcasting Inc./Radiodiffusion Canwest Global Inc. stating the amount equal to the book value or the realization value of the assets of each such Guarantor, whichever is greater, less the sum of its liabilities and its issued and paid-up share capital account and whether such Guarantor is able to discharge its liabilities when due, the whole in accordance with the guarantee agreement to be executed by such Guarantor in accordance with section Section 4.1 (j)(i) hereof.

(d) Closing Conditions Certificate. The Agent shall have received a certificate, dated the Effective Date and signed by a Responsible Officer of the Borrower, confirming compliance with the conditions set forth in Section 4.3(a) and (b).

(e) Fees. The Agent and the Lenders shall have received all fees and other amounts due and payable on or prior to the Effective Date, including, to the extent invoiced, reimbursement or payment of all legal fees and other Out-of-Pocket Expenses required to be reimbursed or paid by the Borrower hereunder or under any other Loan Document, and all fees payable under the Commitment Letter.

(f) Insurance. The Agent shall have received a certificate of insurance coverage, naming the Collateral Agent as loss payee dated not more than 30 days prior to the Effective Date, evidencing that the Borrower and the Credit Parties are carrying insurance in accordance with Section 5.9 hereof.

(g) Inventory Control Systems; Appraisal; Field Audit; Opening Availability. The Agent shall have reviewed and be satisfied with the Collateral, the inventory control systems, the books and records and the reporting capability of the Credit Parties. In addition, the Agent shall have received the results of an updated field audit, and the Borrowing Base on the Effective Date shall be sufficient in value, as determined by Agent, to provide Borrower with Excess Availability, after giving effect to the extensions of credit to be made hereunder on the Effective Date (on a pro forma basis, with trade payables being paid currently, and expenses and liabilities being paid in the ordinary course of business and without acceleration of sales or deterioration of working capital) of at least $45,000,000.

(h) No Cessation of Financing Market. There shall have not been occurred and be continuing on the Effective Date any general banking moratorium or any practical cessation in the bank or private debt financing markets, and there shall not have been introduced any material governmental restrictions imposed on lending institutions, which materially affect the type of lending transactions contemplated by this Agreement.

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(i) Execution and Delivery of Documentation. The Borrower and any other Credit Party which is a party to any Loan Document shall have duly authorized, executed and delivered all documents, including Loan Documents, required hereunder, all in form and substance satisfactory to the Agent and all of the Security Documents shall have been registered in all offices in which, in the opinion of the Agent or its counsel, registration is necessary or of advantage to preserve the priority of the Liens intended to be created thereby, and duplicate copies of such Security Documents bearing or accompanied by appropriate endorsements or certificates of registration shall have been delivered to the Agent. The Agent shall have received and be satisfied with the results of all personal property, bankruptcy, execution and other searches conducted by the Agent and its counsel with respect to the Borrower and any other Credit Party in all jurisdictions selected by the Agent and its counsel. The Agent shall have received and be satisfied with all estoppel letters, acknowledgements, waivers, subordinations, postponements, discharges, priority agreements and inter-creditor and non-disturbance agreements as the Agent may reasonably require to ensure its first priority, subject to Permitted Liens, over and unfettered access to, the Collateral or, at the reasonable discretion of the Agent, have implemented Availability Reserves in connection therewith.

(j) Security Documents. The Agent shall have received:

(i)	a guarantee executed by each Guarantor listed in Schedule 4.1(j) in favour of the Agent, as agent for the Lenders, dated as of the Effective Date and substantially in the form of Exhibit C;

(ii)	the Authorization and Direction;

(iii)

the Credit Confirmation and Amending Agreement; and

(iv)	copies of each of the agreements, documents or instruments described in Schedule 3.30;

provided that if any of the foregoing documents are not suitable for use in any jurisdiction, the applicable Credit Party shall provide to the Agent such alternative document(s) which, are requested by the Agent with substantially equivalent substantive effect and which are suitable for use in such jurisdiction. The Obligations shall be secured by Liens having the priorities set forth in Section 2.20.

(k) Regulatory Approval; Consents; Waivers. The Agent and the Lenders shall be satisfied, acting reasonably, that all material Authorizations required in connection with the Transactions contemplated hereby have been obtained and are in full force and effect (including all approvals listed in Schedule 3.3), and that all consents and waivers required to consummate the Transactions have been obtained, to the extent that consummation of the Transactions would otherwise be restricted or prohibited under the terms of any Material Contract to which the Borrower or any other Credit Party is a party, or by which it is bound, in each case without the imposition of any burdensome provisions.

(l) Delivery of Financial Statements. The Agent and the Lenders shall have received and be satisfied with the financial statements described in Section 3.4(a) and unaudited

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consolidated balance sheets of the Borrower and its Subsidiaries as of February 28, 2009, together with consolidating balance sheets for the Borrower and Guarantors for the six months ended February 28, 2009.

(m) Indebtedness. The Transactions contemplated in this Agreement and the other Loan Documents shall not have caused any event or condition to occur which has resulted, or which will result, in any Material Indebtedness becoming due prior to its scheduled maturity or that permits (with or without the giving of notice, the lapse of time, or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity, or which will result in the creation of any Liens under any Indebtedness.

(n) Blocked Account/Cash Management Systems. The Agent shall have received evidence satisfactory to the Agent that, as of the Effective Date, blocked account and cash management systems complying with Section 2.17 have been established and are currently being maintained in the manner set forth in such Section 2.17, and the Agent shall have received copies of duly executed tri-party blocked account and other control agreements satisfactory to the Agent with the banks and other Persons as required by Section 5.15.

(o) New Notes. The Agent shall have received a fully executed copy of the Note Purchase Agreement; the New Notes shall have been issued by the issuers under the Note Purchase Agreement and purchased by the New Noteholders for the equivalent amount in US Dollars of Cdn.$105,000,000; and the Borrower shall have used the net proceeds of such note issuance and purchase, together with the proceeds of Loans made hereunder, to repay in full all amounts owing under the BNS Credit Agreement; and the BNS Credit Agreement shall have been terminated.

(p) Judgments/Litigation. The Agent shall be satisfied that there are no judgments outstanding, and no legal or administrative proceedings (including in any court arbitrator or any Governmental Authority) pending or threatened except as expressly permitted hereunder which could reasonably be expected to give rise to a Material Adverse Effect.

(q) Post-Closing Matters Agreement. The Agent shall have received a fully executed copy of a post-closing matters agreement substantially in the form attached hereto as Exhibit H.

(r) Other Documentation. The Agent and the Lenders shall have received such other documents and instruments as are customary for transactions of this type or as they may reasonably request.

The obligations of the Lenders to make Loans or provide a Letter of Credit Guarantee hereunder shall not become effective unless each of the foregoing conditions is satisfied (or waived pursuant to Section 9.2) at or prior to 3:00 p.m., Toronto time, on May 22, 2009 (and, in the event such conditions are not so satisfied or waived by such time, the Commitments shall terminate at such time). The conditions set forth in Section 4.1 are for the exclusive benefit of the Lenders, and may be waived by the Lender in accordance with Section 9.2 at any time and from time to time, with or without further conditions.

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4.2 Restructuring Event Date Conditions. The obligation of the Lenders to increase the Commitments to Cdn.$100,000,000 on the Restructuring Event Date, and the obligation of the Lenders to make any Loan or provide a Letter of Credit Guarantee on and after the Restructuring Event Date, shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.2):

(a) if the Restructuring Event Date has occurred, the granting and issuance of the Initial Order satisfactory in form and substance to the Agent and the Initial Order being in full force and effect, unamended and unstayed, except to the extent approved in writing by the Agent;

(b) if the Restructuring Event Date has occurred, the issuance of the Chapter 15 Orders, satisfactory in form and substance to the Agent, and such orders being in full force and effect, unamended and unstayed except to the extent approved in writing by the Agent;

(c) receipt by the Agent, for and on behalf of the Lenders, of (i) a Weekly Cash Flow Projection for the Credit Parties, in form and substance reasonably satisfactory to the Agent, and (ii) a Borrowing Base certificate confirming that, on the Restructuring Event Date, Excess Availability shall be not less than an amount to be determined by the Agent; and

(d) the Borrower shall have formalized the duties and responsibilities to be performed by the special committee of the board of directors of the Borrower and by a Chief Restructuring Officer or restructuring advisor on terms acceptable to the Agent.

4.3 Each Credit Event. The obligation of the Agent (on behalf of the Lenders) to make any Loan or provide a Letter of Credit Guarantee on the occasion of any Borrowing, (including on the occasions of the initial Borrowings hereunder), is subject to the satisfaction of the following conditions:

(a) the representations and warranties of the Borrower set forth in this Agreement shall be true and correct on and as of the date of each such Borrowing (including the date of issuance, amendment, renewal or extension of such Letter of Credit, as applicable) as if made on such date (except where such representation or warranty refers to a different date);

(b) at the time of and immediately after giving effect to such Borrowing (including the issuance, amendment, renewal or extension of such Letter of Credit, as applicable), no Default shall have occurred and be continuing;

(c) following the Restructuring Event Date, the Initial Order shall remain in full force and effect, the Initial Order shall not have been amended, supplemented or otherwise modified except to the extent approved in writing by the Agent; all claims of all creditors of the Credit Parties shall have been and shall remain stayed, the exercise by all creditors of the Credit Parties of creditor rights and remedies shall have been and shall remain stayed; the Lenders and the Agent shall continue to be “unaffected creditors” in the CCAA Proceedings; and all creditors of the Credit Parties shall remain prohibited from interfering with property or contract rights of the Credit Parties; except in each case to the extent agreed in writing by the Agent;

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(d) the Agent shall have received a Borrowing Request in the manner and within the time period required by Section 2.3; and

(e) except as may be otherwise agreed to from time to time by the Agent and the Borrower in writing, after giving effect to the extension of credit requested to be made by the Borrower on such date, the aggregate Exposure will not exceed the lesser of (i) the Commitments, or (ii) an amount equal to the Borrowing Base.

Each Borrowing, including each issuance, amendment, renewal or extension of a Letter of Credit, shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the accuracy of the matters specified in paragraphs (a) and (b) above. This requirement does not apply on the conversion or rollover of an existing Borrowing provided that the aggregate outstanding Borrowings will not be increased as a consequence thereof.

ARTICLE 5

AFFIRMATIVE COVENANTS

From (and including) the Effective Date until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit and Letter of Credit Guarantees shall have expired and been terminated and all Reimbursement Obligations have been satisfied by the Borrower, the Borrower and each other Credit Party covenants and agrees with the Lenders that:

5.1 Financial Statements and Other Information. The Borrower will furnish to the Agent:

(a) on the fourth Business Day of each week, a Weekly Cash Flow Projection;

(b) on the fourth Business Day of each week, a weekly rolling 13-week Excess Availability projection, certified by a Responsible Officer and, after the Restructuring Event Date, the Monitor;

(c) on the fourth Business Day of each week, a weekly and cumulative cash flow comparison, with explanations as to variances therein from projected to actual results (by more than 5%), certified by a Responsible Officer and, after the Restructuring Event Date, the Monitor;

(d) on the fourth Business Day of each week, a weekly statement of the payment of Priority Payables (including confirmation as to when such Priority Payables are due and payable), certified by a Responsible Officer and, after the Restructuring Event Date, the Monitor;

(e) on the fourth Business Day of each week, a weekly statement of the payment of such other amounts as provided for in the Weekly Cash Flow Projections, certified by a Responsible Officer and, after the Restructuring Event Date, the Monitor;

(f) as soon as available and in any event within 90 days after the end of each Fiscal Year of the Borrower, its audited consolidated balance sheet and related statements of income, retained earnings and changes in financial position as of the end of and for such Fiscal Year, setting forth in each case in comparative form the figures for the previous Fiscal Year, all

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reported on by PriceWaterhouseCoopers or other independent auditors of recognized national standing (without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;

(g) as soon as available and in any event within 45 days after the end of each Fiscal Quarter, its unaudited consolidated and consolidating balance sheet (for the Borrower and Guarantors) and related statements of income, retained earnings and changes in financial position as of the end of such Fiscal Quarter and the then elapsed portion of the Fiscal Year which includes such Fiscal Quarter, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous Fiscal Year, all certified by a Responsible Officer as presenting fairly in all material respects the financial condition and results of operations of the Credit Parties on a consolidated and consolidating basis (for the Borrower and Guarantors) in accordance with GAAP consistently applied, subject to normal year-end audit adjustments;

(h) concurrently with the financial statements required pursuant to Sections 5.1(f) and (g) above, a certificate of the Borrower, signed by a Responsible Officer in the form of Exhibit K;

(i) copies of each management letter issued to the Borrower by its auditors promptly following consideration or review thereof by the Board of Directors of the Borrower, or any committee thereof (together with any response thereto prepared by the Borrower);

(j) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by the Borrower or any other Credit Party with any securities commission, stock exchange or similar entity, and all materials distributed out of the ordinary course by the Borrower to its shareholders and which relate to matters in which any Lender or the Agent, in such capacities, can reasonably be expected to have an interest;

(k) as soon as available to the Borrower, copy of any report issued by the Monitor in connection with the CCAA Proceedings, and copies of all motions, pleadings, applications, judicial information, financial information and any other Court filings made pursuant to the CCAA Proceedings;

(l) promptly upon the request of the Agent, and in any event no less frequently than the 10th Business Day of each calendar month, (together with a copy of all or any part of the following reports requested by any Lender in writing after the Effective Date), a Borrowing Base Report, signed by a Responsible Officer and, after the Restructuring Event Date, certified by the Monitor, as of the last day of the immediately preceding calendar month, accompanied by such supporting detail and documentation as shall be requested by the Agent it is reasonable discretion including:

(i)	an accounts receivable aging (including both summary and detail format) showing Accounts outstanding, aged from invoice date as follows: 1 to 30

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days past due, 31 to 60 days past due, 61 to 90 days past due, and 91 days or more past due, accompanied by such supporting detail and documentation as shall be requested by the Agent in its reasonable discretion, including the ledger for disputed/legal accounts;

(ii)	a calculation of the Accounts which would not meet the criteria of an Eligible Account Receivable;

(iii)

a copy of the internally generated month end cash receipts and collections journal;

(iv)	Borrower prepared reconciliation of the cash receipts journal to the blocked depository account;

(v)	an aged listing of the ten largest customer accounts for the month;

(vi)	detailed monthly accounts payable aging; and

(vii)

an aged listing of the ten largest accounts payable for the month.

(m) weekly, on the second Business Day of each week for the prior week (in the case of items (i) – (v) below):

(i)	a weekly Borrowing Base Report that reflects the Accounts as at the last business day of the previous week;

(ii)	a copy of the internally generated weekly sales journal and invoice register;

(iii)

a copy of the internally generated weekly credit memo journal (or sales journal if included there);

(iv)	a copy of the internally generated weekly debit memo journal (or the sales journal if included there); and

(v)	a copy of the internally generated weekly cash receipts and collections journal.

(n) monthly within 30 days of the last day of each calendar month:

(i)	a copy of the internally generated general ledger report as at the month end;

(ii)	a reconciliation of Accounts aging to the general ledger and to the financial statement as at the month end;

(iii)

copies of all material correspondence, actuarial valuation reports and other filings with any pension regulators or the applicable Governmental Entity

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to which such correspondence, reports and filings must be sent (including any filings furnished to the trustee under any Pension Plan and any valuation reports prepared by the Borrower’s actuary and confirming that all contributions to be made in respect of the Pension Plans have been made when due);

(iv)	copies of the most recently available investment or fund statements showing the value of the assets held in connection with each Pension Plan.

(o) such other reports designating, identifying and describing the Accounts, Eligible Real Property or Eligible Equipment as required by the Agent and on a more frequent basis as the Agent may reasonably request in its reasonable credit discretion;

(p) the results of each physical verification, if any, that the Borrower may have made, or caused any other Person to have made on its behalf, of all or any portion of its Eligible Real Property or Eligible Equipment, within 10 Business Days of completion of any such physical verification (and, if a Default or an Event of Default has occurred and be continuing, the Borrower shall, upon the request of the Agent, conduct, and deliver the results of, such physical verifications as the Agent may require);

(q) such appraisals of the assets of the Borrower and the Credit Parties as the Agent may request at any time, such appraisals to be conducted at the expense of the Borrower by an appraiser that is acceptable to the Agent, and shall be in scope, form and substance acceptable to the Agent;

(r) promptly after the Borrower learns of the receipt or occurrence of any of the following, a certificate of the Borrower, signed by a Responsible Officer, specifying (i) any official notice of any violation, possible violation, non-compliance or possible non-compliance, or claim made by any Governmental Authority pertaining to all or any part of the properties of the Borrower or any other Credit Party which could reasonably be expected to have a Material Adverse Effect, (ii) any event which constitutes a Default or Event of Default, together with a detailed statement specifying the nature thereof and the steps being taken to cure such Default or Event of Default, (iii) the receipt of any notice from, or the taking of any other action by, the holder of any promissory note, debenture or other evidence of Indebtedness of the Borrower or any other Credit Party in an amount in excess of Cdn.$100,000 with respect to an actual or alleged default, together with a detailed statement specifying the notice given or other action taken by such holder and the nature of the claimed default and what action the Borrower or the relevant Credit Party is taking or proposes to take with respect thereto, except where any action or result referred to in any such notice is stayed pursuant to the CCAA Orders, (iv) any default or non-compliance of any party to any of the Loan Documents with any of the terms and conditions thereof or any notice of termination or other proceedings or actions which could reasonably be expected to adversely affect any of the Loan Documents, (v) the creation, dissolution, merger or acquisition of any Subsidiary of the Borrower, (vi) any event or condition not previously disclosed to the Agent, which violates any Environmental Law and which could potentially, in the Borrower’s reasonable judgment, have a Material Adverse Effect, (vii) except for any default arising in connection with the CCAA Proceedings, any material amendment to,

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termination of, or material default under a Material Contract or any execution of, or material amendment to, termination of, or material default under, any material collective bargaining agreement, and any other event, development or condition which could reasonably be expected to have a Material Adverse Effect and which is not subject to the Stay of Proceedings;

(s) promptly after the occurrence thereof, notice of the institution of or any material adverse development in any action, suit or proceeding or any governmental investigation or any arbitration before any court or arbitrator or any Governmental Authority or official against the Borrower or any other Credit Party or any of its or their Subsidiaries or any material property of any thereof which could reasonably be expected to have a Material Adverse Effect;

(t) promptly after the filing thereof with any Governmental Authority, copies of each annual and other report (including applicable schedules and actuarial reports) with respect to each Pension Plan of the Borrower or any other Credit Party or any trust created thereunder, unless such requirement is waived by the Agent;

(u) at the cost of the Borrower, a report or reports of an independent collateral field examiner (which collateral field examiner may be the Agent or an Affiliate thereof) approved (i) by the Borrower, whose approval shall not be unreasonably withheld, and (ii) by the Agent with respect to the Eligible Accounts components included in the Borrowing Base. The Agent may (and, at the direction of the Required Lenders, shall) request such reports or additional reports as it (or the Required Lenders) shall reasonably deem necessary;

(v) upon request by the Agent, a summary of the insurance coverages of the Borrower and any other Credit Party, in form and substance reasonably satisfactory to the Agent, and upon renewal of any insurance policy, a copy of an insurance certificate summarizing the terms of such policy, and upon request by the Agent, copies of the applicable policies;

(w) a copy of any plan of arrangement to be filed with the Court pursuant to the CCAA Proceedings, before such plan of arrangement is proposed to the creditors of the Borrower or filed with the Court;

(x) concurrently with any delivery of financial statements under Section 5.1 (f) or (g) above, a certificate of a Responsible Officer of the Borrower (i) stating whether any change in GAAP or in the application thereof has occurred since the date of the audited financial statements referred to in Section 5.1(f) and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate, (ii) identifying all its Subsidiaries existing on the date of such certificate and indicating, for each such Subsidiary, and whether such Subsidiary is a Guarantor and whether such Subsidiary was formed or acquired since the end of the previous calendar month (or alternatively, that there have been no changes in such information since the previous calendar month);

(y) the Borrower shall notify the Agent promptly of any material changes in the purchase, process to purchase or broadcasting of television programming by any Credit Party;

(z) the Borrower shall deliver to the Agent (i) within 30 days of delivery to the trustee or custodian of each applicable Pension Plan, a copy of the notification or remittance (or similar) prepared and delivered in respect of each Pension Plan pursuant to and in accordance

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with section 9.1(1) of the Pension Benefits Standards Act, 1985 (Canada) or section 56.1 of the Pension Benefits Act (Ontario) or similar pension benefits standards legislation and, (ii) within 30 days of the end of each calendar month, a certificate of the Borrower, signed by a Responsible Officer, confirming the amount remitted or contributed in the previous month to each Pension Plan identified in the documentation referred to in (i); and

(aa) annually, within 45 days of the last day of each calendar year, an updated copy of Schedule 3.11 and copies of the most recent CICA 3461 (or similar) valuations prepared in connection with any Pension Plan or any non-pension post-retirement benefit plan of Borrower or any Subsidiary.

5.2 Existence; Conduct of Business. Each Credit Party will do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence (subject only to Section 6.3), and obtain, preserve, renew and keep in full force and effect any and all rights, licenses, permits, privileges and franchises material to the conduct of its business.

5.3 Payment of Obligations. Each Credit Party will pay its obligations, including Tax liabilities, that, if not paid, could result in a Material Adverse Effect before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such other Credit Party has set aside on its books adequate reserves with respect thereto in accordance with GAAP, and (c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect.

5.4 Maintenance of Properties. Each Credit Party will keep and maintain all property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted.

5.5 Books and Records; Inspection Rights. Each Credit Party will keep proper books of record and account in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities. Each Credit Party will permit any representatives designated by the Agent or any Lender, upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested.

5.6 Compliance with Applicable Laws and Material Contracts. Each Credit Party will comply with all Applicable Laws and orders of any Governmental Authority applicable to it or its property and with all of its material contractual obligations, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. No Credit Party shall modify, amend or alter its certificate or articles of incorporation.

5.7 [Intentionally Deleted.]

5.8 Further Assurances. Each Credit Party will cure promptly any defects in the execution and delivery of the Loan Documents, including this Agreement. Upon request, each Credit Party will, at its expense, as promptly as practical, execute and deliver to the Agent, all such other and

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further documents, agreements and instruments in compliance with or performance of the covenants and agreements of the Borrower or any other Credit Party in any of the Loan Documents, including this Agreement, or to further evidence and more fully describe the Collateral, or to correct any omissions in any of the Loan Documents, or more fully to state the security obligations set out herein or in any of the Loan Documents, or to perfect, protect or preserve any Liens created pursuant to any of the Loan Documents, or to make any recordings, to file any notices, or obtain any consents, all as may be necessary or appropriate in connection therewith, in the judgment of the Agent.

5.9 Insurance. Each Credit Party shall maintain insurance on its property and assets under such policies of insurance, with such insurance companies, in such reasonable amounts and covering such insurable risks as are at all times reasonably satisfactory to the Agent. All such policies are subject to the rights of any holders of Permitted Liens holding claims senior to the Agent, to be made payable to the Collateral Agent, to the extent required herein, in case of loss, under a standard non contributory “mortgagee”, “lender” or “secured party” clause and are to contain such other provisions as the Agent or the Collateral Agent may require to fully protect the Collateral Agent’s interest in the property and assets subject to the Liens in favour of the Collateral Agent and to any payments to be made under such policies. All original policies or true copies thereof are to be delivered to the Collateral Agent, with the loss payable endorsement in the Collateral Agent’s favour, and shall provide for not less than thirty (30) days prior written notice to the Collateral Agent of the exercise of any right of cancellation. Upon the occurrence and continuance of an Event of Default which is not waived in writing by the Agent, the Collateral Agent shall, subject to the rights of any holders of Permitted Liens holding claims senior to the Agent, have the sole right, in the name of the Collateral Agent, the Borrower or any other applicable Credit Party, to file claims under any insurance policies, to receive, receipt and give acquittance for any payments that may be payable thereunder, and to execute any and all endorsements, receipts, releases, assignments, reassignments or other documents that may be necessary to effect the collection, compromise or settlement of any claims under any such insurance policies. Amounts received by the Collateral Agent on account of insurance proceeds shall be dealt with in accordance with the Collateral Agency Agreement. The Agent may apply insurance proceeds received by the Agent to the Obligations in such manner as it may deem advisable in its sole discretion. In the event the Borrower fails to provide the Agent with timely evidence, acceptable to the Agent, of the maintenance of insurance coverage required pursuant to this Section 5.9, or in the event that any Credit Party fails to maintain such insurance, the Agent may purchase or otherwise arrange for such insurance, but at the Borrower’s expense and without any responsibility on the Agent’s part for: (i) obtaining the insurance; (ii) the solvency of the insurance companies; (iii) the adequacy of the coverage; or (iv) the collection of claims. The insurance acquired by the Agent may, but need not, protect the Borrower’s or any other Credit Party’s interest in the Collateral, and therefore such insurance may not pay claims which the Borrower may have with respect to the Collateral or pay any claim which may be made against the Borrower in connection with the Collateral. In the event the Agent purchases, obtains or acquires insurance covering all or any portion of the Collateral, the Borrower shall be responsible for all of the applicable costs of such insurance, including premiums, interest (at the applicable interest rate for Revolving Loans set forth in Section 2.5), fees and any other charges with respect thereto, until the effective date of the cancellation or the expiration of such insurance. The Agent may charge all of such premiums, fees, costs, interest and other charges to

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the Borrower’s loan account. The Borrower hereby acknowledges that the costs of the premiums of any insurance acquired by the Agent may exceed the costs of insurance which the Borrower may be able to purchase on its own. In the event that the Agent purchases such insurance, the Agent will promptly, and in any event within fifteen (15) days, notify the Borrower of said purchase.

5.10 Operation and Maintenance of Property. Each Credit Party will, subject to the CCAA Orders, manage and operate its business or cause its business to be managed and operated (i) in accordance with prudent industry practice in all material respects and in compliance in all material respects with the terms and provisions of all applicable licenses, leases, contracts and agreements, (ii) in compliance with the Weekly Cash Flow Projections, and (iii) in compliance with the CCAA Orders and all Applicable Laws of the jurisdiction in which such businesses are carried on, and all Applicable Laws of every other Governmental Authority from time to time constituted to regulate the ownership, management and operation of such businesses, except where a failure to so manage and operate would not have a Material Adverse Effect.

5.11 Additional Subsidiaries; Additional Liens. If, at any time on or after the Effective Date, the Borrower or any other Credit Party creates or acquires an additional Subsidiary or in some other fashion becomes the holder of any Equity Securities of a new Subsidiary:

(a) the Borrower and the other Credit Parties will, as applicable, as soon as practicable execute and deliver to the Collateral Agent a securities pledge agreement, in form and substance satisfactory to the Agent, granting a Lien in favour of the Collateral Agent over 100% of the Equity Securities of such new Subsidiary owned by the Borrower or such other Credit Party; and

(b) to the extent permitted by Applicable Law, the Borrower and the other Credit Parties will cause such new Subsidiary to execute and deliver to the Collateral Agent as soon as practicable (i) a guarantee, and (ii) mortgages, security agreements, hypothecs and other security-related documents covering such new Subsidiary’s property, all in form and substance satisfactory to the Agent, acting reasonably; and

(c) except if expressly permitted by the Agent, each Credit Party shall ensure that none of the terms of such Equity Securities in a partnership or limited liability company shall provide that such Equity Securities are a “security” for the purposes of the STA.

In connection with the execution and delivery of any guarantee, security agreement, intellectual property security agreements, hypothecs or related document pursuant to this Section, the Borrower and each other Credit Party will cause to be delivered to the Agent such corporate resolutions, certificates, legal opinions and such other related documents and registrations as shall be reasonably requested by the Agent and consistent with the relevant forms and types thereof delivered on or prior to the Effective Date or as shall be otherwise reasonably acceptable to the Agent. Each guarantee, pledge agreement, mortgage, security agreement, intellectual property security agreements, hypothecs and other documents delivered pursuant to this Section shall be deemed to be a Security Document from and after the date of execution thereof.

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5.12 Post Closing Undertakings. Borrower will ensure that all post closing undertakings as set forth in Schedule 5.12 (collectively, the “Undertakings”) have been satisfied within the time periods set forth therein and any failure to satisfy any of the Undertakings within the applicable time periods shall constitute an Event of Default.

5.13 Environmental Laws. Each of the Borrower and the other Credit Parties will conduct its business in compliance in all material respects with all Environmental Laws applicable to it or them, including those relating to the Credit Parties’ generation, handling, use, storage and disposal of Hazardous Materials. Each of the Borrower and the other Credit Parties will take prompt and appropriate action to respond to any non-compliance or alleged non-compliance with Environmental Laws, and the Borrower shall regularly report to the Agent on such response. Without limiting the generality of the foregoing, whenever any Credit Party gives notice to the Agent pursuant to Section 5.1(r)(vi) and the Agent so requests, the Credit Parties shall, at the applicable Credit Party’s expense:

(a) cause an independent environmental engineer acceptable to the Agent in its reasonable discretion to conduct such tests of the site where the non-compliance or alleged non-compliance with Environmental Laws has occurred, and prepare and deliver to the Agent a report setting forth the results of such tests, a proposed plan for responding to any environmental problems described therein, and an estimate of the costs thereof;

(b) provide to the Agent a supplemental report of such engineer whenever the scope of the environmental problem, or the Credit Party’s, and any other Person’s response thereto or the estimated costs thereof, shall change. Such reports shall also be addressed to the Agent and the Lenders and shall, as requested by the Agent, set out the results of such engineers’ review of, among other things:

(i)	the internal policies and procedures of the Credit Parties relating to environmental regulatory compliance to ensure that all appropriate steps are being taken by or on behalf of the Credit Parties to comply in all material respects with all applicable requirements of Environmental Laws;

(ii)	the progress of compliance satisfaction, capital expenditures required to effect remedial steps and compliance deficiencies;

(iii)

all other environmental audit reports which the Credit Parties or any predecessor has commissioned in the normal conduct of its business which relate to the subject matter of such notice; and

(iv)

all environmental reports which have been commissioned by or made available to a Credit Party in connection with new acquisitions, and the engineers’ report and recommendations on results of tests performed or samples taken by it during the course of its review, irregularities or steps which may be taken to ensure continued compliance, as well as such other matters as the Borrower and/or the Agent may reasonably request from time to time.

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5.14 Chief Restructuring Officer. The Borrower shall ensure that its Chief Restructuring Officer or restructuring advisor meets regularly, and in any event no less frequently than every two weeks, with the Agent to provide the Agent with updates as to progress towards achieving the Milestones as described in Schedule 7.1(d) and to provide information or commentary on such other matters as the Agent may request.

ARTICLE 6

NEGATIVE COVENANTS

6.1 Indebtedness. No Credit Party will create, incur, assume or permit to exist any Indebtedness, except:

(a) any Indebtedness created hereunder;

(b) any Indebtedness under the New Notes up to a principal amount not exceeding $105,000,000 (plus interest, fees, indemnities and other amounts payable in accordance with the terms of the New Notes as of the date hereof) and any other Indebtedness existing on the date hereof and set forth in Schedule 6.1 (including, any extensions or renewals of any such Indebtedness but excluding any replacements of any such Indebtedness);

(d) any Indebtedness of one Credit Party to another Credit Party;

(e) any Guarantee by a Credit Party of Indebtedness of any other Credit Party;

(f) any Indebtedness of the Credit Parties incurred under Purchase Money Liens or to Capital Lease Obligations in an aggregate amount not exceeding Cdn.$500,000 for all Credit Parties;

(g) any Indebtedness of any Person that becomes a Credit Party after the date hereof, provided that (i) such Indebtedness exists at the time such Person becomes a Credit Party and is not created in contemplation of or in connection with such Person becoming a Credit Party, and (ii) the aggregate principal amount of Indebtedness permitted by this clause (g) shall not exceed Cdn.$500,000 at any time outstanding;

(h) any Indebtedness of the Credit Parties to The Bank of Nova Scotia in respect of cash management services or letters of credit and which is secured by the BNS Priority Collateral; and

(i) any Indebtedness in respect of trade letters of credit or Letters of Credit;

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(j) any Indebtedness in respect of Swap Agreements entered into in compliance with Section 6.5, provided that the aggregate notional amounts under all such Swap Agreements shall not exceed $10,000,000.

6.2 Liens. No Credit Party will, and no Credit Party will permit any Credit Party to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by any Credit Party or assign or sell any income or revenues (including Accounts of the Credit Parties) or rights in respect of any thereof, except Permitted Liens, and after the Restructuring Event Date, the DIP Charge, the Administrative Charge and the Directors’ Charge. For greater certainty, the Agent and the Lenders are entering into this Agreement on the express understanding that no Credit Party will enter into, or permit any other Credit Party to enter into, any other credit arrangement (whether before or after the Restructuring Event Date) which is secured in priority to or pari passu with the Obligations.

6.3 Fundamental Changes; Asset Sales.

(a) No Credit Party will enter into any merger, amalgamation, consolidation, reorganization or recapitalization, sale or transaction resulting in the change ownership or control of the any Credit Party, other than (i) the proposed sale of the Turkish Assets for net proceeds to the Borrower of not less than $13,000,000, and (ii) a sale of the all or any part of Ten Network Shares.

(b) No Credit Party will engage to any material extent in any material business other than businesses of the type conducted by the Credit Party on the date of execution of this Agreement and businesses reasonably related thereto.

6.4 Investments, Loans, Advances, Guarantees and Acquisitions. Each Credit Party will not purchase, hold or acquire (including pursuant to any amalgamation with any Person that was not a Credit Party prior to such amalgamation) any Equity Securities, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, Guarantee any obligations of, or make or permit to exist any Investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person or otherwise make an Acquisition, except Investments by a Credit Party in the Equity Securities of any other Credit Party; loans or advances made by one Credit Party to any other Credit Party; Guarantees constituting Indebtedness permitted by Section 6.1, and loans or advances made by Credit Parties to Persons who are not Credit Parties in an aggregate amount not exceeding $500,000 at any time.

6.5 Swap Transactions. No Credit Party will enter into any Swap Transaction or engage in any transactions in respect thereof, except (i) Swap Transactions entered into by the Borrower to hedge or mitigate risks to which the Borrower or any other Credit Party has actual exposure (other than those in respect of Equity Securities), and (ii) Swap Transactions entered into in order to effectively cap, collar or exchange interest rates (from fixed to floating rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment of the Borrower or any other Credit Party.

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6.6 Restricted Payments. No Credit Party will declare, pay or make, or agree to pay or make, directly or indirectly, any Restricted Payment, except that provided that no Default or Event of Default has occurred and is continuing (a) the Borrower may declare and pay dividends with respect to its Equity Securities payable solely in additional Equity Securities, and (b) any Credit Party may make Restricted Payments to the Borrower or any other Credit Party. No Credit Party will make or agree to make any principal or interest payment on account of the Existing Notes unless, immediately after giving effect to such payment, Excess Availability is equal to or greater than Cdn.$120,000,000. After the Restructuring Event Date, no Credit Party will declare, pay or make, or agree to pay or make, directly or indirectly, any payment of any obligation which is stayed by the CCAA Orders.

6.7 Use of Proceeds . The proceeds of the Loans will not be used for any purpose other than for working capital for the Credit Parties, for expenses of the Borrower arising in the CCAA Proceedings as may be approved by the Court and as contemplated by the Weekly Cash Flow Projections, and for other obligations of the Borrower the payment of which are not stayed by the CCAA Orders.

6.8 Transactions with Affiliates. No Credit Party will sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices and on terms and conditions not less favourable to the Credit Party than could be obtained on an arm’s-length basis from unrelated third parties, (b) transactions between or among the Credit Parties not involving any other Affiliate, and (c) any Restricted Payment permitted by Section 6.6. The foregoing restrictions shall not apply to: (i) the payment of reasonable and customary fees to directors of the Credit Party, (ii) any other transaction with any employee, officer or director of a Credit Party pursuant to employee profit sharing and/or benefit plans and compensation and non-competition arrangements in amounts customary for corporations similarly situated to the Credit Party and entered into in the ordinary course of business and approved by the board of directors of the Credit Party, or (iii) any reimbursement of reasonable out-of-pocket costs incurred by an Affiliate of the Credit Party on behalf of or for the account of the Credit Party.

6.9 Repayment of Debt. No Credit Party will repay, prepay, redeem, repurchase, defease or otherwise make any payment on account of any Indebtedness for borrowed money except for (a) payment on account of Indebtedness owing to the Agent or the Lenders under this Agreement, (b) any payment on account of the New Notes in accordance with the Credit Confirmation and Amendment Agreement, and (c) payment on account of Indebtedness for borrowed money permitted by Section 6.1, the repayment of which is not restricted by Section 6.6.

6.10 Restrictive Agreements. Except for the CCAA Proceedings, no Credit Party will directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Credit Party to create, incur or permit to exist any Lien upon any of its property or assets, (b) the ability of a Credit Party to pay dividends or other distributions with respect to any Equity Securities or with respect to, or measured by, its profits or to make or repay loans or advances to the Borrower or any other Credit Party or to provide a Guarantee of any Indebtedness of the Borrower or any

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other Credit Party, (c) the ability of the Borrower or any other Credit Party to make any loan or advance to the Borrower or any of the other Credit Parties, or (d) the ability of the Borrower or any other Credit Party to sell, lease or transfer any of its property to the Borrower or any other Credit Party; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by Applicable Law or by this Agreement or the Note Purchase Agreement, (ii) the foregoing shall not apply to restrictions and condition existing on the date hereof identified on Schedule 6.9 (but shall apply to any extension or renewal of, or any amendment or modification expanding the scope of, any such restriction or condition), (iii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary of the Borrower pending such sale, provided such restrictions and conditions apply only to the Subsidiary of the Borrower that is to be sold and such sale is permitted hereunder, (iv) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, and (v) clauses (a) and (d) of the foregoing shall not apply to customary provisions in leases and other ordinary course contracts restricting the assignment thereof.

6.11 Capital Lease Obligations. No Credit Party will create, incur, assume or suffer to exist, any Capital Lease Obligations, whether directly or as a guarantor, if, after giving effect thereto, the aggregate amount of all payments (for both principal and interest) required to be made by the Credit Parties on a consolidated basis pursuant to such Capital Lease Obligations would exceed Cdn.$1,000,000 in any Fiscal Year.

6.12 Sales and Leasebacks. No Credit Party will enter into any arrangement, directly or indirectly, with any Person whereby the Credit Party shall sell or transfer any property, whether now owned or hereafter acquired, and whereby the Credit Party shall then or thereafter rent or lease as lessee such property or any part thereof or other property which the Credit Party intends to use for substantially the same purpose or purposes as the property sold or transferred.

6.13 Pension Plan Compliance. No Credit Party will (a) establish a Pension Plan, terminate any Pension Plan in a manner, or take any other action with respect to any Pension Plan, which could reasonably be expected to result in any material liability of any Credit Party, (b) fail to make full payment when due of all amounts which, under the provisions of any Pension Plan, agreement relating thereto, or Applicable Law, the Credit Party is required to pay as contributions thereto, except where the failure to make such payments could not reasonably be expected to have a Material Adverse Effect or result in a Priority Payable, (c) contribute to or assume an obligation to contribute to any “multi-employer pension plan” as such term is defined in the Pension Benefits Act (Ontario) or any Pension Plan not disclosed to the Agent on the Effective Date, (d) acquire an interest in any Person if such Person sponsors, maintains or contributes to, or at any time in the six-year period preceding such acquisition has sponsored, maintained, or contributed to any Pension Plan, (e) acquire the assets or business of any Person if the former employees of such Person are required to be, or will be, enrolled in any existing or newly established Pension Plan of any Credit Party, (f) permit, or allow any Affiliate to permit, to exist a solvency or wind-up funding deficiency with respect to any Pension Plan in an amount which could reasonably be expected to cause a Material Adverse Effect.

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6.14 Sale or Discount of Receivables. No Credit Party will discount or sell (with or without recourse) any of its Accounts.

6.15 Unconditional Purchase Obligations. No Credit Party will enter into or be a party to, any material contract for the purchase of materials, supplies or other property or services, if such contract requires that payment be made by it regardless of whether or not delivery of such materials, supplies or other property or services is ever made, provided that this Section 6.14 shall not restrict the ability of any Credit Party to enter into any such contract in the ordinary course of its business to the extent that the materials, supplies or other property or services which are the subject matter of such contract are reasonably expected to be used by the applicable Credit Party in the ordinary course of its business.

6.16 Capital Expenditures. No Credit Party will make Capital Expenditures in a Fiscal Year for the Credit Parties on a consolidated basis in excess of 120% of the budgeted Capital Expenditures for Fiscal Year, as set forth in the most recent capital expenditure budget delivered to and approved by the Agent and, after the Restructuring Event Date, the Monitor.

6.17 No Amendments to Material Contracts. No Credit Party will amend, modify or terminate (or waive any provision of or provide any consent under), any Material Contract in a manner which could reasonably be expected to have a Material Adverse Effect.

6.18 Plan of Arrangement. The Credit Parties will not (and will not apply to any court of competent jurisdiction for authority to), file any plan or arrangement in the CCAA Proceedings that does not provide for the repayment in full in cash on the effective date thereof of all outstanding Obligations.

6.19 Employee Compensation. No Credit Party shall materially increase compensation or severance entitlements or other benefits payable to directors, officers or employees (including by way of a “key employee retention plan”), or pay any bonuses whatsoever, other than as required by Applicable Law or pursuant to the terms of existing benefit plans or employment contracts.

6.20 Professional Retainers. Except as previously disclosed in writing to the Agent, no Credit Party shall (i) enter into or make any payments on account of new retainers of professionals or advisors (other than any advisor to the special committee of the board of directors of the Parent and excluding ordinary course professional fees and legal fees that are not success based or lump sum payments), (ii) establish or fund any directors or employees trust or (iii) purchase or fund any additional directors’ and officers’ insurance, in each case unless otherwise approved by the Agent and, after the Restructuring Event date, the Monitor.

6.21Maximum Borrowings. The Credit Parties shall ensure that, as of any date, the aggregate borrowings then outstanding under the New Notes and Exposure under this Agreement will not exceed by more than 5% the then-applicable forecast borrowing requirements of the Credit Parties for such date as set forth in the Weekly Cash Flow Projection.

6.22 Maximum Disbursements. The Credit Parties shall ensure that, (i) as of any date, each of the actual total receipts and capital expenditures of the Credit Parties for the previous 4-week period will not exceed by more than 10% the comparable item for the Credit Parties for such

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period as set forth in the Weekly Cash Flow Projection, as such item may be updated, and (ii) as of any date, each of the net operating cash flow and total net cash flow of the Credit Parties for the previous 4-week period will not exceed the greater of 10% or $1,500,000 in excess of the comparable item for the Credit Parties for such period as set forth in the Weekly Cash Flow Projection, as such item may be updated.

6.23 Securities Accounts and Futures Accounts. No Credit Party shall own or maintain a Securities Account or a Futures Account.

6.24 Aggregate Receipts. The Credit Parties shall ensure that, as of any date, the aggregate receipts of the Credit Parties for the previous 4 week period will not have been more than 10% less than the forecast receipts for the Credit Parties for such period as set forth in the initial cash flow forecast for the Credit Parties, tested every Tuesday for the previous week ended Sunday.

6.25 Note Maturity Date. The Borrower shall not extend the “Maturity Date” under the Note Purchase Agreement.

ARTICLE 7

EVENTS OF DEFAULT

7.1 Events of Default. It shall constitute an event of default (“Event of Default”) if any one or more of the following shall occur:

(a) the Borrower shall fail to pay any principal of any Loan or any Reimbursement Obligation in respect of any Letter of Credit when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;

(b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) above) payable under this Agreement, when and as the same shall become due and payable;

(c) any representation or warranty made or deemed made by or on behalf of any Credit Party in or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, shall prove to have been incorrect when made or deemed to be made;

(d) any Credit Party shall fail to observe or perform any covenant, condition or agreement contained in Section 5.1(n)(ii) (notices of Defaults or Events of Default), 5.2 (with respect to the Credit Party’s existence), 5.7, 5.9 or 5.13 or in Article 6 (or in any comparable provision of any other Loan Document), or any of the milestones (as described in Schedule 7.1(d)) have not been satisfied by the date upon which they are required to have been satisfied as set forth in Schedule 7.1(d);

(e) any Credit Party shall fail to observe or perform any covenant, condition or agreement contained in this Agreement (other than those specified in clauses (a), (b) or (d)

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above) or any other Loan Document, and such failure shall continue unremedied for a period of 10 days after notice thereof from the Agent to the Borrower (which notice will be given at the request of any Lender);

(f) the Initial Order shall have been amended, supplemented or otherwise modified without the prior written consent of the Agent, or the Borrower shall have failed to comply in any material respect with any provision of any of the CCAA Orders, or the Stay of Proceedings shall have expired;

(g) any Credit Party shall fail to make any payment whether of principal or interest, and regardless of amount, in respect of any Material Indebtedness, when and as the same shall become due and payable, and the rights and remedies of the creditor or creditors thereunder are not stayed by the Stay of Proceedings; provided that, prior to the Restructuring Event Date, there shall be deemed to be no Event of Default under this Section 7.1(g) in respect of the Existing Notes unless the maturity date of the Existing Notes has been accelerated;

(h) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity, and the rights and remedies of the creditor or creditors thereunder are not stayed by the Stay of Proceedings; provided that, prior to the Restructuring Event Date, there shall be deemed to be no Event of Default under this Section 7.1(h) in respect of the Existing Notes unless the maturity date of the Existing Notes has been accelerated;

(i) a trustee in bankruptcy, receiver, interim receiver, receiver and manager or official with similar powers shall be appointed with respect to any Credit Party or its assets; or an application shall be filed by any Credit Party for the approval of any other superpriority claim (other than the DIP Charge and the Administrative Charge) in the CCAA Proceedings which is pari passu with or senior to the claims of the Agent and the Lenders against any Credit Party hereunder; or there shall arise or be granted any such pari passu or senior superpriority claim without the consent of the Agent in its exclusive discretion; or a motion shall be filed by any Credit Party in the CCAA Proceedings for the approval of any other superpriority charge other than the DIP Charge and Administrative Charge, or there shall arise any such pari passu or senior charge without the consent of the Agent in its exclusive discretion;

(j) the US Bankruptcy Court shall enter an order or orders granting relief from the automatic stay applicable under Section 362 of the US Bankruptcy Code or the stay in the Initial Order, as applicable, to the holder or holders of any security interest to permit foreclosure or enforcement of any kind (or the granting of a deed in lieu of foreclosure or the like) on any assets of any of the Credit Parties;

(k) an order of the US Bankruptcy Court or the Court shall be entered reversing, amending, supplementing, staying for a period in excess of ten (10) days, vacating or otherwise modifying any of the Orders without the prior written consent of the Agent;

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(l) at any time on or after the Restructuring Event Date, the Credit Parties shall make any payment (whether by way of adequate protection or otherwise) of principal or interest or otherwise on account of any pre-petition Indebtedness or payables, other than payments authorized by the Bankruptcy Court and approved by the Agent, under (i) materialmen’s, shippers, warehousemen’s and other similar liens and certain other pre-petition claims in an aggregate amount not to exceed $250,000, (ii) the payment of current interest, letter of credit fees and other fees and reimbursable costs and expenses (and the payment of all interest and fees that are accrued and unpaid as of the Restructuring Event Date) under this Agreement and the New Notes, (iii) payments in respect of prepetition claims of taxing authorities in an aggregate amount not to exceed $250,000; (iv) the payment of pre-petition claims to certain critical vendors in an aggregate amount not to exceed $250,000.

(m) at any time on or after the Restructuring Event Date, the occurrence of any of the following in the CCAA Proceedings:

(i)

the bringing or filing of a motion by any Credit Party, or the granting, entry or issuance of an order or ruling (which has not been withdrawn, dismissed or reversed): (A) to obtain additional financing which is not otherwise permitted pursuant to this Agreement (unless such financing is proposed to refinance and pay in full the Obligations due under this Agreement with the termination of all of the Commitments); (B) to grant any Lien other than Permitted Liens upon or affecting any Collateral without the prior written consent of Agent and Required Lenders; (C) which is materially adverse to Agent and Lenders or their rights and remedies hereunder or their interest in the Collateral;

(ii)

the filing of any plan of arrangement or information circular in connection therewith, or any direct or indirect amendment to such plan or information circular, by any of the Credit Parties to which Agent and the Required Lenders do not consent or otherwise agree to the treatment of their claims;

(iii)

the granting, entry or issuance of an order amending, supplementing, staying, vacating or otherwise modifying the Loan Documents or any of the CCAA Orders without the written consent of the Required Lenders or the bringing or filing of a motion for leave to appeal, or the appeal, of any of the CCAA Orders;

(iv)

the sale or other disposition, without the Required Lenders’ consent, of all or substantially all of the assets of any Credit Party through a sale approved by the Court, through a sanctioned plan of arrangement in the CCAA Proceedings, or otherwise that does not provide for payment in full in cash of the Obligations and termination of the Commitments;

(v)

the failure of any Credit Party to perform any of its material obligations under or in the CCAA Proceedings, which adversely affects the interests of the Lenders, as reasonably determined by the Agent;

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(n) one or more judgments for the payment of money in a cumulative amount in excess of Cdn.$250,000 (or its then equivalent in any other currency) in the aggregate is rendered against the Borrower, any other Credit Party or any combination thereof and the enforcement of such judgment is not stayed by the CCAA Proceedings and the Borrower or the other Credit Party has not (i) provided for its discharge in accordance with its terms within 30 days from the date of entry thereof, or (ii) procured a stay of execution thereof within 30 days from the date of entry thereof and within such period, or such longer period during which execution of such judgment has not been stayed, appealed such judgment and caused the execution thereof to be stayed during such appeal, provided that if enforcement and/or realization proceedings are lawfully commenced in respect thereof in the interim, such grace period will cease to apply;

(o) any property of any Credit Party having a fair market value in excess of Cdn.$100,000 (or its then equivalent in any other currency) in the aggregate is seized (including by way of execution, attachment, garnishment, levy or distraint); or any Lien thereon securing Indebtedness in excess of Cdn.$100,000 (or its then equivalent in any other currency) is enforced, or such property has become subject to any charging order or equitable execution of a Governmental Authority; or any writ of execution or distress warrant or other document issued by a court of competent jurisdiction in respect of the seizure of any property exists in respect of the Borrower, any other Credit Party or the property of any of them; or any sheriff or other Person becomes lawfully entitled by operation of law or otherwise to seize or distrain upon such property, and in any such case, such action is not stayed by the CCAA Proceedings;

(p) one or more final judgments, not involving the payment of money and not otherwise specified in this Section 7.1(p), has been rendered against any Credit Party, the result of which could reasonably be expected to result in a Material Adverse Effect, and the enforcement of such judgment is not stayed by the CCAA Proceedings;

(q) this Agreement, any other Loan Document or any material obligation or other provision hereof or thereof at any time for any reason terminates or ceases to be in full force and effect and a legally valid, binding and enforceable obligation of any Credit Party, is declared to be void or voidable or is repudiated, or the validity, binding effect, legality or enforceability hereof or thereof is at any time contested by any Credit Party, or any Credit Party denies that it has any or any further liability or obligation hereunder or thereunder or any action or proceeding is commenced to enjoin or restrain the performance or observance by any Credit Party of any material terms hereof or thereof or to question the validity or enforceability hereof or thereof, or at any time it is unlawful or impossible for any Credit Party to perform any of its material obligations hereunder or thereunder;

(r) any Lien purported to be created by any Security Document shall cease to be, or shall be asserted by any Credit Party not to be, a valid, perfected, first priority (except as otherwise expressly provided in this Agreement or such Security Document) Lien in Collateral with a fair market value or book value (whichever is greater) in excess, individually or in the aggregate, of $100,000;

(s) a Material Adverse Change shall occur;

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(t) a Change in Control shall occur;

(u) if any Credit Party or any of its Subsidiaries violates any Environmental Law which results in an Action Request, Violation Notice or other notice or control order or cancellation of any license or certificate or approval, that results in any material disruption of any Credit Party’s business or that could reasonably be expected to have a Material Adverse Effect;

(v) any event , circumstances or condition shall occur or exist with respect to a Pension Plan or post-retirement non-pension benefit plan that could, in the Lenders’ good faith judgment, subject any Credit Party to any tax, penalty or other liabilities under Applicable Laws which could reasonably be expected to give rise to a Material Adverse Effect;

then, and in every such event, and at any time thereafter during the continuance of such event or any other such event, the Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take any or all of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind except as set forth earlier in this paragraph, all of which are hereby waived by the Borrower, (iii) apply any amounts outstanding to the credit of the Borrower to repayment of all amounts outstanding under this Agreement, and (iv) declare any or all of the Security Documents to be immediately enforceable.

7.2 Remedies.

(a) If an Event of Default has occurred and is continuing, the Agent may, in its discretion, and shall, at the direction of the Required Lenders, do one or more of the following at any time or times and in any order, without notice to or demand on the Borrower: (i) reduce the Commitments, or the advance rates against Eligible Accounts used in computing the Borrowing Base, or reduce one or more of the other elements used in computing the Borrowing Base; (ii) restrict the amount of or refuse to make Revolving Loans; (iii) restrict or refuse to provide Letters of Credit or Letters of Credit Guarantee; (iv) terminate the Commitments and this Agreement; (v) declare any or all Obligations to be immediately due and payable; and (vi) pursue its other rights and remedies under the Loan Documents and Applicable Law and equity, including directing the Collateral Agent to enforce the Liens in respect of the CIT Priority Collateral.

(b) If an Event of Default has occurred and is continuing and without limiting any rights or remedies arising under the Security Documents, (i) the Agent or the Collateral Agent, as applicable, shall have for the benefit of the Lenders, in addition to all other rights of the Agent and the Lenders, the rights and remedies of a secured party under Applicable Law (including, as applicable, the PPSA, Civil Code of Quebec and the UCC) in the jurisdiction where the Collateral is located and all rights and remedies provided for in the Loan Documents; (ii) the Agent may, at any time, take possession of the Collateral and keep it on the Borrower’s or any

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Guarantor’s Premises, at no cost to the Agent or any Lender, or remove any part of it to such other place or places as the Agent may desire, or the Borrower or any Guarantor shall, upon the Agent’s demand, at the Borrower’s cost, assemble the Collateral and make it available to the Agent at a place convenient to the Agent; and (iii) the Agent may sell and deliver any Collateral at public or private sales, for cash, upon credit or otherwise, at such prices and upon such terms as the Agent deems advisable, in its sole discretion, and may postpone or adjourn any sale of the Collateral by an announcement at the time and place of sale or of such postponed or adjourned sale without giving a new notice of sale. Without in any way requiring notice to be given in the following manner, the Borrower and each of the Guarantors agree that any notice by the Agent of sale, disposition or other intended action hereunder or in connection herewith, whether required by the PPSA, Civil Code of Quebec and the UCC or otherwise, shall constitute reasonable notice to the Borrower and Guarantors if such notice is mailed by registered or certified mail, return receipt requested, postage prepaid, or is delivered personally against receipt, at least fifteen (15) days prior to such action to the Borrower’s address specified in or pursuant to Section 9.1. If any Collateral is sold on terms other than payment in full at the time of sale, no credit shall be given against the Obligations until the Agent or the Lenders receive payment, and if the buyer defaults in payment, the Agent may resell the Collateral without further notice to the Borrower or any Guarantor. If the Agent seeks to take possession of all or any portion of the Collateral by judicial process, the Borrower and each of the Guarantors irrevocably waives: (A) the posting of any bond, surety or security with respect thereto which might otherwise be required; (B) any demand for possession prior to the commencement of any suit or action to recover the Collateral; and (C) any requirement that the Agent retain possession and not dispose of any Collateral until after trial or final judgment. The Borrower and each of the Guarantors agree that the Agent and Lenders have no obligation to preserve rights to the Collateral or marshal any Collateral for the benefit of any Person. To the extent permitted by applicable law, the Agent is hereby granted a license or other right to use, without charge, all of the Borrower’s and each Guarantor’s Property, whether or not constituting Collateral, including its real estate, Equipment and Intellectual Property Rights (including labels, patents, copyrights, name, trade secrets, trade names, trademarks, and advertising matter, or any similar property), in completing production of, advertising or selling any Collateral, and the Borrower’s and Guarantors’ rights under all licenses and all franchise agreements shall inure to the Agent’s benefit for such purpose. The proceeds of sale shall be applied first to all expenses of sale, including legal fees, and then to the Obligations. The Agent will return any excess to the Borrower and Guarantors and the Borrower shall remain liable for any deficiency.

(c) If an Event of Default has occurred and is continuing, to the maximum extent permitted by law, the Borrower and each of the Guarantors hereby waive all rights to notice and hearing prior to the exercise by the Agent of the Agent’s rights to repossess the Collateral without judicial process or to reply, attach or levy upon the Collateral without notice or hearing.

ARTICLE 8

THE AGENT

8.1 Appointment of Agent. Each Lender hereby designates CIT Business Credit Canada Inc. as Agent to act as herein specified and as specified in the other Loan Documents. Each Lender hereby irrevocably authorizes the Agent to take such action on its behalf under the

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provisions of the Loan Documents and to exercise such powers and to perform such duties thereunder as are specifically delegated to or required of the Agent by the terms thereof and such other powers as are reasonably incidental thereto. The Agent may perform any of its duties hereunder by or through its agents or employees.

8.2 Limitation of Duties of Agent. The Agent shall have no duties or responsibilities except those expressly set forth with respect to the Agent in this Agreement and as specified in the other Loan Documents. Neither the Agent nor any of its Related Parties shall be liable for any action taken or omitted by it hereunder or in connection herewith, unless caused by its or their gross negligence or willful misconduct. The duties of the Agent shall be mechanical and administrative in nature; the Agent shall not have, by reason of this Agreement or the other Loan Documents, a fiduciary relationship in respect of any Lender. Nothing in this Agreement or the other Loan Documents, expressed or implied, is intended to or shall be so construed as to impose upon the Agent any obligations in respect of this Agreement except as expressly set forth herein. The Agent shall be under no duty to take any discretionary action permitted to be taken by it pursuant to this Agreement or the other Loan Documents unless it is requested in writing to do so by the Required Lenders.

8.3 Lack of Reliance on the Agent.

(a) Independent Investigation. Independently, and without reliance upon the Agent, each Lender, to the extent it deems appropriate, has made and shall continue to make (i) its own independent investigation of the financial condition and affairs of the Borrower or any other Credit Party in connection with the taking or not taking of any action in connection herewith, and (ii) its own appraisal of the creditworthiness of the Borrower or any other Credit Party, and, except as expressly provided in this Agreement and the other Loan Documents, the Agent shall have no duty or responsibility, either initially or on a continuing basis, to provide any Lender with any credit or other information with respect thereto, whether coming into its possession before the consummation of the Transactions or at any time or times thereafter.

(b) Agent Not Responsible. The Agent shall not be responsible to any Lender for any recitals, statements, information, representations or warranties herein or in any document, certificate or other writing delivered in connection herewith or for the execution, effectiveness, genuineness, validity, enforceability, collectability, priority or sufficiency of this Agreement or the other Loan Documents or the financial condition of the Borrower and any of the other Credit Parties or be required to make any inquiry concerning either the performance or observance of any of the terms, provisions or conditions of this Agreement or the other Loan Documents, or the financial condition of the Borrower and any of the other Credit Parties, or the existence or possible existence of any Default or Event of Default.

8.4 Certain Rights of the Agent. If the Agent shall request instructions from the Lenders or the Required Lenders (as the case may be) with respect to any act or action (including the failure to act) in connection with this Agreement or the other Loan Documents, the Agent shall be entitled to refrain from such act or taking such action unless and until the Agent shall have received written instructions from the Lenders or the Required Lenders, as applicable, and the Agent shall not incur liability to any Person by reason of so refraining. Without limiting the foregoing, no Lender shall have any right of action whatsoever against the Agent as a result of

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the Agent acting or refraining from acting under this Agreement and the other Loan Documents in accordance with the instructions of the Required Lenders, or, to the extent required by Section 9.2, all of the Lenders.

8.5 Reliance by Agent. The Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, statement, certificate, telex, teletype or facsimile message, electronic mail, cablegram, radiogram, order or other documentary teletransmission or telephone message believed by it to be genuine and correct and to have been signed, sent or made by the proper Person. The Agent may consult with legal counsel (including counsel for the Borrower), independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken by it in good faith in accordance with the advice of such counsel, accountants or experts.

8.6 Indemnification of Agent. To the extent the Agent is not reimbursed and indemnified by the Borrower, each Lender will reimburse and indemnify the Agent, in proportion to its aggregate Applicable Percentage, for and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including reasonable counsel fees and disbursements) or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against the Agent in performing its duties hereunder, in any way relating to or arising out of this Agreement or any other Loan Document; provided that no Lender shall be liable to the Agent for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from the Agent’s gross negligence (it being acknowledged that ordinary negligence does not necessarily constitute gross negligence) or willful misconduct.

8.7 The Agent in its Individual Capacity. With respect to its obligations under this Agreement and the Loans made by it, CIT Business Credit Canada Inc., in its capacity as a Lender hereunder, shall have the same rights and powers hereunder as any other Lender and may exercise the same as though it were not performing the duties, if any, specified herein; and the terms “Lenders”, “Required Lenders”, and any similar terms shall, unless the context clearly otherwise indicates, include CIT Business Credit Canada Inc., in its capacity as a Lender hereunder. The Agent may accept deposits from, lend money to, and generally engage in any kind of banking, trust, financial advisory or other business with the Borrower or any affiliate of the Borrower as if it were not performing the duties, if any, specified herein, and may accept fees and other consideration from the Borrower for services in connection with this Agreement and otherwise without having to account for the same to the Lenders.

8.8 May Treat Lender as Owner. The Borrower and the Agent may deem and treat each Lender as the owner of the Loans recorded on the Register maintained pursuant to Section 9.4(c) for all purposes hereof until a written notice of the assignment or transfer thereof shall have been filed with the Agent. Any request, authority or consent of any Person who at the time of making such request or giving such authority or consent is the owner of a Loan shall be conclusive and binding on any subsequent owner, transferee or assignee of such Loan.

8.9 Successor Agent.

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(a) Agent Resignation. The Agent may resign at any time by giving written notice thereof to the Lenders, the Issuing Bank and the Borrower. Upon any such resignation, the Required Lenders shall have the right, upon five Business Days’ notice to the Borrower, to appoint a successor Agent, subject to the approval of the Borrower, such approval not to be unreasonably withheld. If no successor Agent shall have been so appointed by the Required Lenders, and shall have accepted such appointment, within 30 days after the retiring Agent’s giving of notice of resignation, then, upon five Business Days’ notice to the Borrower, the retiring Agent may, on behalf of the Lenders, appoint a successor Agent (subject to approval of the Borrower, such approval not to be unreasonably withheld), which shall be a financial institution organized under the laws of Canada having a combined capital and surplus of at least Cdn.$100,000,000 or having a parent company with combined capital and surplus of at least Cdn.$100,000,000.

(b) Rights, Powers, etc. Upon the acceptance of any appointment as Agent hereunder by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be discharged from its duties and obligations under this Agreement. After any retiring Agent’s resignation or removal hereunder as Agent, the provisions of this Article 8 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement.

8.10 No Independent Legal Action by Lenders.

No Lender may take any independent legal action to enforce any obligation of the Borrower hereunder. Each Lender hereby acknowledges that, to the extent permitted by Applicable Law, the Security Documents and the remedies provided thereunder to the Lenders are for the benefit of the Lenders collectively and acting together and not severally, and further acknowledges that each Lender’s rights hereunder and under the Security Documents are to be exercised collectively, not severally, by the Agent upon the decision of the Required Lenders. Accordingly, notwithstanding any of the provisions contained herein or in the Security Documents, each of the Lenders hereby covenants and agrees that it shall not be entitled to take any action hereunder or thereunder, including any declaration of default hereunder or thereunder, but that any such action shall be taken only by the Agent with the prior written agreement of the Required Lenders, provided that, notwithstanding the foregoing, in the absence of instructions from the Lenders (or the Required Lenders) and where in the sole opinion of the Agent the exigencies of the situation so warrant such action, the Agent may without notice to or consent of the Lenders (or the Required Lenders) take such action on behalf of the Lenders as it deems appropriate or desirable in the interests of the Lenders. Each Lender hereby further covenants and agrees that upon any such written consent being given by the Required Lenders, it shall co-operate fully with the Agent to the extent requested by the Agent, and each Lender further covenants and agrees that all proceeds from the realization of or under the Security Documents, to the extent permitted by Applicable Law, are held for the benefit of all of the Lenders and shall be shared among the Lenders rateably in accordance with this Agreement, and each Lender acknowledges that all costs of any such realization (including all amounts for which the Agent is required to be indemnified under the provisions hereof) shall be shared among the Lenders rateably in accordance with this Agreement. Each Lender covenants and agrees to do all acts

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and things and to make, execute and deliver all agreements and other instruments, so as to fully carry out the intent and purpose of this Section and each Lender hereby covenants and agrees that it shall not seek, take, accept or receive any security for any of the obligations and liabilities of the Borrower hereunder or under the other Loan Documents, or any other document, instrument, writing or agreement ancillary hereto or thereto, other than such security as is provided hereunder or thereunder, and that it shall not enter into any agreement with any of the parties hereto or thereto relating in any manner whatsoever to the Credit(s), unless all of the Lenders shall at the same time obtain the benefit of any such security or agreement, as the case may be.

8.11 Notice of Default. The Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, unless the Agent shall have received written notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”. The Agent will notify the Lenders of its receipt of any such notice. Subject to Section 8.4, the Agent shall take such action with respect to such Default or Event of Default as may be requested by the Required Lenders in accordance with this Agreement in pursuing any rights or remedies under the Loan Documents or at law or in equity; provided, however, that unless and until the Agent has received any such request, the Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable.

8.12 Agency for Perfection. Each Lender hereby appoints each other Lender as agent for the purpose of perfecting the Lenders’ security interest in assets which can be perfected only by possession. Should any Lender (other than the Agent) obtain possession of any such Collateral, such Lender shall notify the Agent thereof, and, promptly upon the Agent’s request therefor, shall deliver such Collateral to the Agent or in accordance with the Agent’s instructions.

8.13 Payments by Agent to Lenders. All payments to be made by the Agent to the Lenders shall be made by bank wire transfer or internal transfer of immediately available funds to each Lender pursuant to wire transfer instructions delivered in writing to the Agent on or prior to the Closing Date (or if such Lender is an Assignee, on the applicable Assignment and Transfer), or pursuant to such other wire transfer instructions as each party may designate for itself by written notice to the Agent. Concurrently with each such payment, the Agent shall identify whether such payment (or any portion thereof) represents principal, premium or interest on the Revolving Loans or otherwise.

8.14 Concerning the Collateral and the Related Loan Documents. Each Lender authorizes and directs the Agent to enter into this Agreement and the other Loan Documents for the rateable benefit and obligation of the Agent and the Lenders. Each Lender agrees that any action taken by the Agent or Required Lenders, as applicable, in accordance with the terms of this Agreement or the other Loan Documents, and the exercise by the Agent or the Required Lenders, as applicable, of their respective powers set forth therein or herein, together with such other powers that are reasonably incidental thereto, shall be binding upon all of the Lenders.

8.15 Field Audit and Examination Reports; Disclaimer by Lenders. By signing this Agreement, each Lender:

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(a) is deemed to have requested that the Agent furnish such Lender, promptly after it becomes available, a copy of each field audit or examination report (each a “Report” and collectively, “Reports”) prepared by the Agent;

(b) expressly agrees and acknowledges that the Agent (i) makes no representation or warranty as to the accuracy of any Report, or (ii) shall not be liable for any information contained in any Report;

(c) expressly agrees and acknowledges that the Reports are not comprehensive audits or examinations, that the Agent or other party performing any audit or examination will inspect only specific information regarding the Borrower and/or Guarantors and will rely significantly upon the Borrower’s and Guarantor’s books and records, as well as on representations of the Borrower’s and Guarantor’s personnel;

(d) agrees to keep all Reports confidential and strictly for its internal use, and not to distribute, except to its participants, or use any Report in any other manner; and

(e) without limiting the generality of any other indemnification provision contained in this Agreement, agrees: (i) to hold the Agent and any such other Lender preparing a Report harmless from any action the indemnifying Lender may take or conclusion the indemnifying Lender may reach or draw from any Report in connection with any loans or other credit accommodations that the indemnifying Lender has made or may make to the Borrower, or the indemnifying Lender’s participation in, or the indemnifying Lender’s purchase of, a loan or loans of the Borrower; and (ii) to pay and protect, and indemnify, defend and hold the Agent and any such other Lender preparing a Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses and other amounts (including counsel’s costs) incurred by the Agent and any such other Lender preparing a Report as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender.

8.16 Quebec Security. For greater certainty, and without limiting the powers of the Agent or any other Person acting as an agent or mandatary for the Agent hereunder or under any of the other Loan Documents, the Borrower hereby acknowledges that, for purposes of holding any security granted by the Borrower or any other Credit Party on property pursuant to the laws of the Province of Quebec to secure obligations of the Borrower or any other Credit Party under any bond or debenture, the Collateral Agent shall be the holder of an irrevocable power of attorney (fondé de pouvoir) (within the meaning of the Civil Code of Quebec) for all present and future Lenders and Issuing Banks and in particular for all present and future holders of any such bond or debenture. Each Lender and Issuing Bank hereby confirms and ratify the appointment of the Collateral Agent as fondé de pouvoir under the Collateral Agency Agreement and, for greater certainty, hereby irrevocably constitutes, to the extent necessary, the Collateral Agent as the holder of an irrevocable power of attorney (fondé de pouvoir) (within the meaning of Article 2692 of the Civil Code of Quebec) in order to hold security granted by the Borrower or any other Credit Party in the Province of Quebec to secure the obligations of the Borrower or any other Credit Party under any bond or debenture. Each assignee of a Lender or Issuing Bank shall be deemed to have confirmed and ratified the constitution of the Collateral Agent as the holder of such irrevocable power of attorney (fondé de pouvoir) by execution of an Assignment and Assumption or any other document pursuant to which they become a party to this Agreement.

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Notwithstanding the provisions of section 32 of the An Act respecting the special powers of legal persons (Quebec), the Collateral Agent may acquire and be the holder of any bond or debenture. The Borrower hereby acknowledges that such bond or debenture constitutes a title of indebtedness, as such term is used in Article 2692 of the Civil Code of Quebec. The execution by the Collateral Agent as fondé de pouvoir of any deeds of hypothec or other documents prior to the date hereof is hereby ratified and confirmed. Each Lender and Issuing Bank also agree that the Agent or the Collateral Agent may hold any bond or debenture issued by the Borrower or any other Credit Party, including as named bondholder or debentureholder or as pledge on their behalf in accordance with Article 2705 of the Civil Code of Quebec. The Collateral Agent acting as fondé de pouvoir shall have the same rights, powers, immunities, indemnities and exclusions from liability as are prescribed in favour of the Agent in this Agreement, which shall apply mutatis mutandis to the Collateral Agent acting as fondé de pouvoir. Without limitation, the provisions of this Section 8.11 shall apply mutatis mutandis to the resignation and appointment of a successor to the Collateral Agent acting as fondé de pouvoir.

ARTICLE 9

MISCELLANEOUS

9.1 Notices. (a) Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile in each case to the addressee, as follows:

(i) if to the Borrower or any other Credit Party:

CANWEST MEDIA INC.

000 Xxxxxxx Xxxxxx

Xxx Xxxx Global Place

31st Floor

Winnipe, Manitoba R3B 3L7

Attention: Chief Financial Officer

Facsimile: (000) 000-0000

(ii) if to the Agent:

CIT BUSINESS CREDIT CANADA INC.

207 Queen’s Quay West, Suite 700

Toronto, Ontario M5J 1A7

Attention: Chief Credit Officer

Facsimile: (000) 000-0000

(iii) if to any Lender or any Issuing Bank, to it at its address (or facsimile number) set forth opposite its name in the execution page(s) of this Agreement or the applicable Assignment and Assumption Agreement, as the case may be.

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(b) Any notice received by the Borrower from the Agent shall be deemed also to have been received by each other Credit Party. Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communications pursuant to procedures approved by the Agent. The Agent or the Borrower may, in its discretion, agree to accept notices and other communication to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

(c) Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt.

9.2 Waivers; Amendments.

(a) No failure or delay by the Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Agent and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by Section 9.2(b), and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default, regardless of whether the Agent or any Lender may have had notice or knowledge of such Default at the time.

(b) Neither this Agreement nor any other Loan Document (or any provision hereof or thereof) may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Agent with the consent of the Required Lenders (and for greater certainty, any such waiver, amendment or modification shall not require any consent or other agreement of any Credit Party other than the Borrower, notwithstanding that any such Credit Party may be a party to this Agreement or any other Loan Document); provided that no such agreement shall:

(i)

increase the amount or extend the expiry date of any Commitment of any Lender;

(ii)

reduce the principal amount of any Loan or reduce the rate of interest or any fee applicable to any Loan;

(iii)

postpone the scheduled date of payment of the principal amount of any Loan, or any interest thereon, or any fees payable in respect thereof, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment;

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(iv)

change any aspect of this Agreement in a manner that would alter the pro rata sharing of payments required herein;

(v)

change any of the provisions of this Section 9.2 or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder;

(vi)

waive any Event of Default under Section 7.1(h), (i) or (j); or

(vii)

release the Borrower or any other Credit Party from any material obligations under the Security Documents and other instruments contemplated by this Agreement, release or discharge any of the Liens arising under the Security Documents, permit the creation of any Liens, other than Permitted Liens, on any of the assets subject to the Liens arising under the Security Documents, lower the priority of any Lien arising under any of the Security Documents, or lower the priority of any payment obligation of the Borrower or any other Credit Party under any of the Loan Documents;

in each case without the prior written consent of each Lender; or, in the case of the matters referred to in clauses (i), (ii), (iii) and (iv), without the prior written consent of each Lender directly affected thereby and provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Agent hereunder, without the prior written consent of the Agent. For greater certainty, the Agent may release and discharge the Liens constituted by the Security Documents to the extent necessary to enable the Borrower to complete any asset sale which is not prohibited by this Agreement or the other Loan Documents. Any waiver, amendment or modification approved by the Required Lenders in accordance with this Section 9.2(b) is binding on all Lenders.

9.3 Expenses; Indemnity; Damage Waiver.

(a) The Borrower shall pay (i) all reasonable Out-of-Pocket Expenses incurred by the Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Agent and all applicable Taxes, in connection with the syndication of the credit facilities provided for herein and the preparation and administration of this Agreement and the other Loan Documents, (ii) all reasonable Out-of-Pocket Expenses incurred by the Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Agent and applicable Taxes, in connection with any amendments, modifications or waivers of the provisions hereof or of any of the other Loan Documents, (whether or not the transactions contemplated hereby or thereby shall be consummated), and (iii) all Out-of-Pocket Expenses incurred by the Agent or any Lender, including the fees, charges and disbursements of any counsel for the Agent or any Lender and all applicable Taxes, in connection with the enforcement or protection of their rights in connection with this Agreement, including its rights under this Section, or in connection with the Loans made hereunder, including all such Out-of-Pocket Expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

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(b) Each Credit Party shall indemnify the Agent and each Lender, as well as each Related Party and each assignee of any of the foregoing Persons (each such Person and each such assignee being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, cost recovery actions, damages, expenses and liabilities of whatsoever nature or kind and all Out-of-Pocket Expenses and all applicable Taxes to which any Indemnitee may become subject arising out of or in connection with (i) the execution or delivery of the Loan Documents or any agreement or instrument contemplated thereby, the performance by the parties thereto of their respective obligations thereunder, and the consummation of the Transactions or any other transactions thereunder, (ii) any Loan or Letter of Credit or any actual or proposed use of the proceeds therefrom, including any refusal by the Issuing Bank to honour a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any other Credit Party, or any Environmental Liability related in any way to the Borrower or any other Credit Party, (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto, (v) any other aspect of this Agreement and the other Loan Documents, or (vi) the enforcement of any Indemnitee’s rights hereunder and any related investigation, defence, preparation of defence, litigation and enquiries; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence (it being acknowledged that ordinary negligence does not necessarily constitute gross negligence) or wilful misconduct of or material breach of this Agreement by such Indemnitee.

(c) To the extent that the Borrower fails to pay any amount required to be paid under Sections 9.3 (a) or (b), each Lender severally agrees to pay to the Agent such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Agent, in its capacity as such.

(d) The Credit Parties shall not assert, and hereby waive (to the fullest extent permitted by Applicable Law), any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, any Loan Document, or any agreement or instrument contemplated thereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.

(e) Any inspection of any property of the Borrower or any other Credit Party made by or through the Agent or any Lender is for purposes of administration of the Credits only, and neither the Borrower nor any other Credit Party is entitled to rely upon the same (whether or not such inspections are at the expense of the Borrower).

(f) By accepting or approving anything required to be observed, performed, fulfilled or given to the Agent or the Lenders pursuant to the Loan Documents, neither the Agent nor the Lenders shall be deemed to have warranted or represented the sufficiency, legality, effectiveness

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or legal effect of the same, or of any term, provision or condition thereof, and such acceptance or approval thereof shall not constitute a warranty or representation to anyone with respect thereto by the Agent or the Lenders.

(g) The relationship between the Borrower and the Agent and the Lenders is, and shall at all times remain, solely that of borrower and lenders. Neither the Agent nor the Lenders shall under any circumstance be construed to be partners or joint venturers of the Borrower or its Affiliates. Neither the Agent nor the Lenders shall under any circumstance be deemed to be in a relationship of confidence or trust or a fiduciary relationship with the Borrower or its Affiliates, or to owe any fiduciary duty to the Borrower or its Affiliates. Neither the Agent nor the Lenders undertake or assume any responsibility or duty to the Borrower or its Affiliates to select, review, inspect, supervise, pass judgment upon or inform the Borrower or its Affiliates of any matter in connection with their property or the operations of the Borrower or its Affiliates. The Borrower and its Affiliates and all Shareholders and all direct and indirect shareholders of the Credit Parties shall rely entirely upon their own judgment with respect to such matters, and any review, inspection, supervision, exercise of judgment or supply of information undertaken or assumed by the Agent or the Lenders in connection with such matters is solely for the protection of the Agent and the Lenders, and neither the Borrower nor any other Person is entitled to rely thereon.

(h) The Agent and the Lenders shall not be responsible or liable to any Person for any loss, damage, liability or claim of any kind relating to injury or death to Persons or damage to Property caused by the actions, inaction or negligence of the Borrower or any other Credit Party and/or their Affiliates and/or any Shareholder and/or any direct or indirect shareholder of any Credit Party; each Credit Party hereby indemnifies and holds the Agent and the Lenders harmless from any such loss, damage, liability or claim.

(i) This Agreement is made for the purpose of defining and setting forth certain obligations, rights and duties of the Borrower, the Agent and the Lenders in connection with the Loans, and is made for the sole benefit of the Borrower, each other Credit Party, the Agent and the Lenders, and the Agent’s and each Lender’s successors and assigns. Except as provided in Sections 9.3(b) and 9.4, no other Person shall have any rights of any nature hereunder or by reason hereof.

(j) All amounts due under this Section 9.3 shall be payable not later than three Business Days after written demand therefor.

9.4 Successors and Assigns.

(a) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void), and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby and, to the

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extent expressly contemplated hereby, the Related Parties of each of the Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b) Any Lender may assign to one or more assignees all or a portion of its rights and obligations under this Agreement and the other Loan Documents (including all or a portion of its Commitments and the Loans at the time owing to it); provided that (i) except in the case of an assignment of (x) any Commitment to an assignee that is a Lender with a Commitment immediately prior to giving effect to such assignment, each of the Agent and the Borrower must give its prior written consent to such assignment (which consent shall not be unreasonably withheld or delayed) by the Borrower; and provided further that (ii) notwithstanding clause (i) immediately above, the Borrower’s consent shall not be required with respect to any assignment made at any time after the occurrence and during the continuance of an Event of Default, (iii) except in the case of an assignment to a Lender or a Lender Affiliate or an assignment of the entire remaining amount of the assigning Lender’s Commitment, the amount of the Commitment of the assigning Lender subject to each such assignment (determined as of the date on which the Assignment and Assumption relating to such assignment is delivered to the Agent) shall not be less than Cdn.$1,000,000 (or, in the case of a U.S. Dollar-denominated Commitment, the U.S. $ Equivalent of Cdn.$1,000,000), unless each of the Borrower and the Agent otherwise consent in writing and the amount held by each Lender after each such assignment shall not be less than Canadian $1,000,000 (or, in the case of a U.S. Dollar-denominated Commitment, the U.S. $ Equivalent of Cdn.$1,000,000), unless each of the Borrower and the Agent otherwise consent in writing, (iv) each partial assignment in respect of a Commitment and the related Loans shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement in respect of such Commitment and the related Loans, (v) the parties to each assignment shall execute and deliver to the Agent an Assignment and Assumption, together with (except in the case of an assignment to a Lender or a Lender Affiliate) a processing and recordation fee of Cdn.$3,500, payable by the assigning Lender, and (vi) the assignee, if it shall not be a Lender, shall deliver to the Agent an Administrative Questionnaire. The Agent shall provide the Borrower and each Lender with written notice of any change in (or new) address of a Lender disclosed in an Administrative Questionnaire. Subject to acceptance and recording thereof pursuant to Section 9.4(d), from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, shall have all of the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.12, 2.14 and 9.3). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.4 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 9.4(e).

(c) The Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices in Toronto, Ontario a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount of the Loans and the amount of the Reimbursement

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Obligations owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive, and the Borrower, the Agent, and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower and any Lender at any reasonable time and from time to time upon reasonable prior notice.

(d) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in Section 9.4(b) and any written consent to such assignment required by Section 9.4(b), the Agent shall accept such Assignment and Assumption and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this Section 9.4(d).

(e) Any Lender may, without notice to the Borrower or the consent of the Borrower or the Agent, sell participations to one or more Persons (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement and the other Loan Documents (including all or a portion of its Commitment and the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, and (iii) the Borrower, the Agent, and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.2(b) that affects such Participant. Subject to Section 9.4(f), the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.12, and 2.14 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to this Section 9.4(b). To the extent permitted by Applicable Law, each Participant also shall be entitled to the benefits of Section 9.8 as though it were a Lender, provided that such Participant agrees to be subject to Section 2.15(c) as though it were a Lender.

(f) A Participant shall not be entitled to receive any greater payment under Section 2.13 or 2.14 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.14 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.14(e) as though it were a Lender.

(g) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and Section 9.4 shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or

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assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

9.5 Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated. Sections 2.12, 2.14 and 9.3 and Article 8 shall survive and remain in full force and effect, regardless of the consummation of the Transactions, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any provision hereof.

9.6 Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan Documents and any separate letter agreements with respect to fees payable to the Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.1, this Agreement shall become effective when it shall have been executed by the Agent and when the Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed original counterpart of a signature page of this Agreement by facsimile or other electronically scanned method of delivery shall be as effective as delivery of a manually executed original counterpart of this Agreement.

9.7 Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof, and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

9.8 Right of Set-Off. If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by Applicable Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of any Credit Party against any of and all of the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured. The rights of each

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Lender under this Section are in addition to other rights and remedies (including other rights of set off) which such Lender may have.

9.9 Governing Law; Jurisdiction; Consent to Service of Process.

(a) This Agreement shall be construed in accordance with and governed by the Laws of the Province of Ontario.

(b) The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the non-exclusive jurisdiction of the Courts of the Province of Ontario, and any appellate court thereof, in any action or proceeding arising out of or relating to this Agreement, or any other Loan Document or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in Ontario. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Applicable Law. Nothing in this Agreement shall affect any right that the Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or its properties in the courts of any other jurisdiction.

(c) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in this Section 9.9. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by Applicable Law, any forum non conveniens defence to the maintenance of such action or proceeding in any such court.

(d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.1. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by Applicable Law.

9.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

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9.11 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

9.12 Confidentiality. Each of the Agent and each Lender agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to each of their, and each of their Affiliates’, directors, officers, employees, agents and advisors, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any rating agency, regulatory authority or other Governmental Authority, or their legal counsel, (c) to the extent required by Applicable Laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies under any Loan Document or any suit, action or proceeding relating to any Loan Document or the enforcement of rights thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any actual or prospective assignee of or Participant (or such assignee’s or Participant’s advisors) in any of its rights or obligations under this Agreement, or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (g) any financial institution (other than as otherwise identified in this Section 9.12), credit reporting agency or credit bureau, (h) any Person with whom the Borrower or any other Credit Party may have or proposes to have material financial dealings, or (i) with the consent of the Borrower. For greater certainty, the Borrower and each of the Credit Parties acknowledges that from time to time as a result of the co-ownership of the Agent by CIT Financial Limited and Canadian Imperial Bank of Commerce (“CIBC”), the Borrower or any other Credit Party may request the Agent to facilitate the provision of certain financial services offered by CIBC (the “CIBC Services”). In such circumstances, CIBC policies and procedures (“CIBC’s Policies”) will apply in respect of all transactions undertaken by CIBC in connection with the provision of the CIBC Services, including any required due diligence investigation and related business approval processes conducted in respect of the Borrower and the other Credit Parties. In such circumstances, it may be prudent, necessary or cost effective for the Agent to provide to CIBC information regarding the Borrower or any other Credit Party that is in the possession or control of the Agent solely for the purpose of facilitating compliance with CIBC’s Policies. The Borrower and each of the Credit Parties consents to the disclosure of Information by the Agent to CIBC for the purpose of facilitating compliance with CIBC’s Policies. For the purposes of this Section, “Information” means all information received from the Borrower or any Credit Party relating to the Borrower, any of the Credit Parties, or their respective businesses, other than Information that is (i) is or becomes publicly available other than as a result of a breach of this Section, (ii) any such information that is or becomes available to the Agent, the Issuing Bank, any Lender or CIBC on a non-confidential basis prior to disclosure by the Borrower, or (iii) was already in the possession of the Agent, the Issuing Bank, or any Lender or CIBC prior to its disclosure by the Borrower or any other Credit Party; or (iv) marked “non-confidential” (or such other words or expression having the same or similar meaning by the Borrower or any other Credit Party). Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has

12298241.7

exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information, acting prudently.

9.13 Press Releases and Related Materials. Each Credit Party agrees that neither it nor its Affiliates will in the future issue any press releases or other public disclosure using the name of the Agent or any of the Lenders or referring to this Agreement, or the other Loan Documents without at least two (2) Business Days’ prior notice to the Agent or the applicable Lender unless (and only to the extent that) such Credit Party or Affiliate is required to do so under law and then, in any event, such Credit Party or Affiliate will consult with the Agent or the applicable Lender before issuing such press release or other public disclosure. Each Credit Party consents to the publication by the Agent or any Lender of advertising material relating to the financing transactions contemplated by this Agreement using its name, product photographs, logo or trademark. The Agent reserves the right to provide to industry trade organizations information necessary and customary for inclusion in league table measurements.

9.14 Anti-Money Laundering Legislation.

(a) The Borrower acknowledges that, pursuant to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and other applicable anti-money laundering, anti-terrorist financing, government sanction and “know your client” laws (collectively, including any guidelines or orders thereunder, “AML Legislation”), the Lenders and the Agent may be required to obtain, verify and record information regarding the Borrower, its directors, authorized signing officers, direct or indirect shareholders or other Persons in control of the Borrower, and the transactions contemplated hereby. The Borrower shall promptly provide all such information, including supporting documentation and other evidence, as may be reasonably requested by any Lender or the Agent, or any prospective assignee or participant of a Lender or the Agent, in order to comply with any applicable AML Legislation, whether now or hereafter in existence.

(b) If the Agent has ascertained the identity of the Borrower or any authorized signatories of the Borrower for the purposes of applicable AML Legislation, then the Agent:

(i)

shall be deemed to have done so as an agent for each Lender, and this Agreement shall constitute a “written agreement” in such regard between each Lender and the Agent within the meaning of applicable AML Legislation; and

(ii)

shall provide to each Lender copies of all information obtained in such regard without any representation or warranty as to its accuracy or completeness.

Notwithstanding the preceding sentence and except as may otherwise be agreed in writing, each of the Lenders agrees that the Agent has no obligation to ascertain the identity of the Borrower or any authorized signatories of the Borrower on behalf of any Lender, or to confirm the completeness or accuracy of any information it obtains from the Borrower or any such authorized signatory in doing so.

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9.15 No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favouring or disfavouring any party by virtue of the authorship of any provisions of this Agreement.

9.16 Paramountcy. In the event of any inconsistency between the provisions of this Agreement and the provisions of any other Loan Document, the provisions of this Agreement shall prevail.

9.17 LIMITATION OF LIABILITY. NO CLAIM MAY BE MADE BY THE BORROWER, ANY GUARANTOR, ANY LENDER OR OTHER PERSON AGAINST THE AGENT, ANY LENDER, OR THE AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES, OR AGENTS OF ANY OF THEM FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY ACT, OMISSION OR EVENT OCCURRING IN CONNECTION THEREWITH, AND THE BORROWER, EACH GUARANTOR, EACH LENDER AND THE AGENT HEREBY WAIVES, RELEASES AND AGREES NOT TO XXX UPON ANY CLAIM FOR SUCH DAMAGES, WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS FAVOUR.

9.18 Subordination of Intercompany Indebtedness. Each of the Credit Parties agree that any and all indebtedness owed by such Credit Party to any Credit Party shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Obligations. Notwithstanding any right of any Credit Party to ask, demand, xxx for, take or receive any payment in respect of any intercompany Indebtedness owed to any Credit Party, any and all rights, liens and security interests of any Credit Party, whether now or hereafter arising and howsoever existing, in any assets of any other Subsidiary of Parent (whether constituting part of the Collateral given to the Agent to secure payment of all or any part of the Obligations or otherwise) shall be and are subordinated to the rights of the Agent and the Lenders in those assets upon the occurrence and continuance of an Event of Default. No Credit Party shall have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Obligations (other than unasserted contingent indemnity obligations) shall have been fully paid and satisfied and all financing arrangements among the Credit Parties and the Lenders have been terminated. So long as any Event of Default shall have occurred and be continuing, then, any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any intercompany Indebtedness owed by any Credit Party shall be paid or delivered directly to the Agent for application on any of the Obligations, due or to become due, until such Secured Obligations (other than contingent indemnity obligations) shall have first been fully paid and satisfied. Each of the Credit Parties irrevocably authorize and empower the Agent to demand, xxx for, collect and receive every such payment or distribution and give acquittance therefor and to make and present for and on behalf of any Credit Party such proofs of claim and take such other action, in the Agent’s own name or in the name of the applicable Credit Party or

12298241.7

otherwise, as the Agent may deem necessary or advisable for the enforcement of this Section 9.18. The Agent may vote such proofs of claim in any such proceeding, receive and collect any and all dividends or other payments or disbursements made thereon in whatever form the same may be paid or issued and apply the same on account of any of the Secured Obligations. Should any payment, distribution, security or instrument or proceeds thereof be received by any Credit Party upon or with respect to the intercompany Indebtedness at any time an Event of Default shall have occurred and be continuing and prior to the satisfaction of all of the Obligations and the termination of all financing arrangements among the Credit Parties and the Lenders, the applicable Credit Party shall receive and hold the same in trust, as trustee, for the benefit of the Lenders and shall so long as any Event of Default shall have occurred and be continuing promptly deliver the same to the Agent, for the benefit of the Lenders, in precisely the form received (except for the endorsement or assignment of the applicable Credit Party where necessary), for application to any of the Secured Obligations, due or not due, and, until so delivered, the same shall be held in trust by the applicable Credit Party as the property of the Lenders. If any Credit Party fails to make any such endorsement or assignment to the Agent, the Agent or any of its officers or employees are irrevocably authorized to make the same. So long as any Event of Default shall have occurred and be continuing, the Credit Parties agree that until the Secured Obligations have been paid in full (in cash) and satisfied and all financing arrangements among the Credit Parties and the Lenders have been terminated, the Credit Parties will neither assign nor transfer to any Person (other than the Agent) any claim the Credit Parties have or may have against any other Subsidiary of the Parent.

9.19 Language. The parties herein have expressly requested that this Agreement and all related documents be drawn up in the English language. À la demande expresse des parties aux présentes, cette convention et tout document y afférent ont été rédigés en langue anglaise.

[Remainder of this page is intentionally left blank]

[Signature Pages Follow]

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SCHEDULE A

COMMITMENTS

Lender	Commitment
CIT Business Credit Canada Inc.	$75,000,000

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SCHEDULE B

DISCLOSED MATTERS

NIL

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SCHEDULE C

MATERIAL CONTRACTS

1. Senior Subordinated Note Indenture made as of 18 November 2004 as supplemented by a first supplemental indenture dated as of 18 November, 2004 as supplemented by a second supplemental indenture dated 30 August, 2005 as supplemented by a third supplemental indenture dated 31 August, 2005 as supplemented by a fourth supplemental indenture dated 1 September, 2005 as supplemented by a fifth supplemental indenture dated 31 May, 2006 as supplemented by a sixth supplemental indenture dated 29 August, 2008 as supplemented by a seventh supplemental indenture dated 1 September, 2008 as supplemented by an eighth supplemental indenture dated 2 April, 2009.

2. CanWest Partnership Agreement made as of 7 September 2005 as amended and restated by the amended and restated limited partnership agreement made as of 13 October 2005 as amended and restated by the second amended and restated limited partnership agreement made 10 July 2007.

3. Canwest Television Limited Partnership Agreement made as of 1 September 2008 as amended and restated by the amended and restated limited partnership agreement made 31 December 2008.

4. Note Purchase Agreement as between, inter alia, Canwest Media Inc. and Canwest Television Limited Partnership as issuers, and CIBC Mellon Trust Company as collateral agent, dated 20 May, 2009.

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SCHEDULE 3.3

APPROVALS

NIL

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SCHEDULE 3.5

LITIGATION

NIL

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SCHEDULE 3.9

LIENS ON REAL PROPERTY

1. 0000 Xxxxxxxxxx Xxxxxx, Xxxxxxx, XX

(a)

Restrictive covenant E30432

(b)

Restrictive covenant G29341

(c)

Restrictive covenant G61868

(d)

Restrictive covenant H18394

(e)

Restrictive covenant G6997

(f)

Restrictive covenant F52253

(g)

Restrictive covenant C27269

(h)

Restrictive covenant C63595

(i)

Restrictive covenant C63889

(j)

Restrictive covenant D69145

(k)

Restrictive covenant G4152

(l)

Restrictive covenant D83804

(m)

Restrictive covenant E36023

(n)

Restrictive covenant E62778

(o)

Statutory right of way registered as Instrument BP77837

(p)

Statutory right of way registered as Instrument BP77838

(q)

Statutory right of way registered as Instrument BR350506

2. 0000 Xxxxxx Xxx XX, Xxxxxxxx, XX

(a)

Utility right of way registered as Instrument 2462Q

(b)

Caveat registered as Instrument 912068631

3. 000-00 Xxxxxx XX, Xxxxxxx, XX

(a)

Zoning regulations registered as Instrument 771147064

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(b)

Utility right of way registered as Instrument 791195963

(c)

Restrictive covenant registered as Instrument 801207241

(d)

Utility right of way registered as Instrument 801215295

4. 00 Xxxxxx Xxxxxx Xxxx, Xxxxxxx, XX

(a)

Lease registered as Instrument NY580854

(b)

Notice registered as Instrument NY633113

(c)

Agreement registered as Instrument NY635293

(d)

Restrictive covenants registered as Instrument NY635612Z

(e)

Lease registered as Instrument NY635614

(f)

Acknowledgement registered as Instrument NY653430

(g)

Agreement registered as Instrument NY739155

(h)

Agreement registered as Instrument NY739156

(i)

Lease registered as Instrument NY792532

(j)

Lease registered as Instrument TB20692

(k)

Assignment of lease registered as Instrument TB154393

(l)

Assignment of lease registered as Instrument TB220574

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SCHEDULE 3.10

LIENS ON PERSONAL PROPERTY

NIL

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SCHEDULE 3.11

PENSION PLANS

[Canwest has redacted Schedule 3.11, which is confidential.]

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SCHEDULE 3.13

DEFAULTS

Default as a result of the non-payment by the Borrower of interest payable on March 15, 2009 on the 8% senior subordinated notes due 2012 and the failure to remedy the non-payment of such interest within 30 days pursuant to the terms of the Note Indenture dated as of November 18, 2004, as supplemented by a first supplemental indenture dated as of 18 November, 2004 as supplemented by a second supplemental indenture dated 30 August, 2005 as supplemented by a third supplemental indenture dated 31 August, 2005 as supplemented by a fourth supplemental indenture dated 1 September, 2005 as supplemented by a fifth supplemental indenture dated 31 May, 2006 as supplemented by a sixth supplemental indenture dated 29 August, 2008 as supplemented by a seventh supplemental indenture dated 1 September, 2008 as supplemented by an eighth supplemental indenture dated 2 April, 2009.

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SCHEDULE 3.15

SUBSIDIARIES

Part A

See Attached

Part B

The following is a list of the Subsidiaries whose Equity Securities have not been pledged to the Collateral Agent:

1. One Central Park West Property Limited

2. CWF Capital Ltd.

3. CWF Investments Ltd.

4. Canwest Entertainment Inc.

5. 4437489 Canada Inc.

6. CanWest (U.S) Inc.

7. 3848671 Canada Limited

8. 3919048 Canada Ltd.

9. TVtropolis General Partnership

12. CanWest International Holdings (Luxembourg) S.a.r.l.

13. CanWest International Corp.

14. CanWest MediaWorks UK Limited

15. Karakoy Televizyon ve Radyo Yayinciligi Ticaret A.S.

16. CanWest Medya Yonetim Ticaret U.C. A.S.

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SCHEDULE 3.20

EMPLOYEE MATTERS

(See Attached)

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SCHEDULE 3.22

INTELLECTUAL PROPERTY MATTERS

(See Attached)

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SCHEDULE 3.27

BANK ACCOUNTS; SECURITIES ACCOUNTS; FUTURES ACCOUNTS

[Canwest has redacted Schedule 3.27, which is confidential.]

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SCHEDULE 3.28

ELIGIBLE REAL PROPERTY

Existing Secured Properties

000-00 Xxxxxx XX, Xxxxxxx, XX

0000 Xxxxxx Xxx, Xxxxxxxx, XX

00 Xxxxxx Xxxxxx Xxxx, Xxxxxxx, XX

0000 Xxxxxxxxxx Xxxxxx, Xxxxxxxxx, XX

Additional Secured Properties

0000 Xxxxxxx Xxx., Xxx Xxxx, XX

000 Xxxxx Xxxxxxxx, Xxxxxxxxx, XX

000 Xxxxxxx Xxxxxx Xxxx, Xxxxxxxx, XX

000 Xxxxx Xxxx, Xxxxxxxx, XX

000 Xxxx Xxxxxx, Xxxxxxx, XX

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SCHEDULE 3.28

REAL PROPERTY AND LEASES

(See Attached)

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SCHEDULE 3.30

PRIORITIES; JURISDICTIONS OF CREDIT PARTIES;

LIST OF SECURITY DOCUMENTS; BROADCAST PERMITS

LIST OF SECURITY DOCUMENTS

Canadian Security Documentation

1. Omnibus General Security Agreement dated as of October 13, 2005 made by the Borrower, the Canadian Guarantors, the Quebec Guarantors and the Barbados Guarantors as amended by an Amendment to Omnibus General Security Agreement dated as of May 19, 2009

(a)

Instrument of Adhesion to Omnibus General Security Agreement entered into by, inter alia, Canwest Television GP Inc. and Canwest Television Limited Partnership dated as of September 1, 2008

(b)

Instrument of Adhesion to Omnibus General Security Agreement entered into by, inter alia, 4501063 Canada Inc. and 4501071 Canada Inc. dated as of April 2, 2009

2. Omnibus Assignment of Insurance dated as of October 13, 2005 made by the Borrower, the Canadian Guarantors, the Quebec Guarantors, the Barbados Guarantors and the U.S. Guarantors

(a)

Instrument of Adhesion to Omnibus Assignment of Insurance entered into by, inter alia, CanWest MediaWorks (US) Holdings Corp. dated as of Xxxxx 0, 0000

(x)

Instrument of Adhesion to Omnibus Assignment of Insurance entered into by, inter alia, The New Republic, LLC (being the former name of 30109, LLC) dated as of August 29, 2008

(c)

Instrument of Adhesion to Omnibus Assignment of Insurance entered into by, inter alia, Canwest Television GP Inc. and Canwest Television Limited Partnership dated as of September 1, 2008

(d)

Instrument of Adhesion to Omnibus Assignment of Insurance entered into by, inter alia, 4501063 Canada Inc. and 4501071 Canada Inc. dated as of April 2, 2009

3. Omnibus Securities Pledge Agreement dated as of October 13, 2005 made by the Borrower, Canwest Global Communications Corp., CanWest International Communications Inc., CanWest MediaWorks Ireland Holdings, Fox Sports World Canada Holdco Inc., National Post Holdings Ltd., Canwest Television GP Inc., Canwest Television Limited Partnership, 4501063 Canada Inc. and 4501071 Canada Inc. as amended by an Amendment Agreement to Omnibus Securities Pledge Agreement dated as of March 3, 2006

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(a)

Instrument of Adhesion to Omnibus Securities Pledge Agreement entered into by, inter alia, Canwest Television GP Inc. dated as of September 1, 2008

(b)

Instrument of Adhesion to Omnibus Securities Pledge Agreement entered into by, inter alia, Canwest Television Limited Partnership dated as of January 1, 2009

(c)

Instrument of Adhesion to Omnibus Securities Pledge Agreement entered into by, inter alia, 4501063 Canada Inc. and 4501071 Canada Inc. dated as of Xxxxx 0, 0000

(x)

Supplement to Omnibus Securities Pledge Agreement entered into by, inter alia:

(i)

Canwest Media Inc. and Canwest Television GP Inc. dated as of September 1, 2008

(ii)

Canwest Media Inc. dated as of November 27, 2008

(iii)

Canwest Television Limited Partnership dated as of January 1, 2009

(iv)

Canwest Media Inc. dated as of January 1, 2009

(v)

Canwest Global Communications Corp. dated as of January 1, 2009

(vi)

Canwest Media Inc. dated as of April 2, 2009

(vii)

4501063 Canada Inc. dated as of April 2, 2009

(viii)

4501071 Canada Inc. dated as of April 2, 2009

(ix)

4501063 Canada Inc. dated as of April 6, 2009

(x)

Canwest Global Communications Corp. dated as of April 6, 2009

(xi)

Canwest Media Inc. dated as of April 6, 2009

4. Securities Pledge Agreement dated as of October 13, 2005 made by the Borrower and CanWest Ireland Nominee Limited

5. Omnibus Intellectual Property Security Agreement dated as of October 13, 2005 made by the Borrower, Canwest Global Communications Corp., The National Post Company/La Publication National Post, Canwest Television GP Inc., Canwest Television Limited Partnership, 4501063 Canada Inc. and 4501071 Canada Inc.

(a)

Instrument of Adhesion to Omnibus Intellectual Property Security Agreement entered into by, inter alia, Canwest Television GP Inc. and Canwest Television Limited Partnership dated as of September 1, 2008

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(b)

Instrument of Adhesion to Omnibus Intellectual Property Security Agreement entered into by, inter alia, 4501063 Canada Inc. and 4501071 Canada Inc. dated as of April 2, 2009

6. Omnibus Confirmation of Security Interest in Trade-marks dated as of October 13, 2005 made by the Borrower, Canwest Global Communications Corp. and The National Post Company/La Publication National Post

7. Confirmation of Security Interest in Intellectual Property dated as of January 1, 2009 made by Canwest Television Limited Partnership

8. Note Pledge Agreement dated as of October 13, 2005 made by the Borrower

9. Deed of Hypothec and Issue of Mortgage Bonds entered into by, inter alia, each of the Borrower, Canwest Global Broadcasting Inc./Radiodiffusion Canwest Global Inc. and Canwest Finance Inc./Financiere Canwest Inc. dated as of October 11, 2005

10. Deed of Hypothec entered into by, inter alia, National Post Holdings Ltd., The National Post Company/La Publication National Post and the Borrower dated as of October 11, 2005

11. Hypothec and Pledge of Bonds entered into by, inter alia, each of the Borrower, Canwest Global Broadcasting Inc./Radiodiffusion Canwest Global Inc. and Canwest Finance Inc./Financiere Canwest Inc. dated as of October 13, 2005

12. Movable Hypothec and Pledge entered into by, inter alia, the Borrower dated as of October 13, 2005

13. Deed of Hypothec and Issue of Mortgage Bonds entered into by, inter alia, Canwest Television Limited Partnership dated as of February 12, 2009

14. Hypothec and Pledge of Bonds entered into by, inter alia, Canwest Television Limited Partnership dated as of February 12, 2009

15. Assignment of the Canwest Services Agreement dated as of October 13, 2005 made by the Borrower

16. Issuer Control Agreement dated as of January 1, 2009 made by Canwest Television Limited Partnership, as pledgor, Fox Sports World Canada, as issuer and CIBC Mellon Trust Company, as Collateral Agent

17. Issuer Control Agreement dated as of January 1, 2009 made by Fox Sports World Canada Holdco Inc., as pledgor, Fox Sports World Canada, as issuer and CIBC Mellon Trust Company, as Collateral Agent

18. Unregistered $3,000,000,000 Demand Debenture granted as of October 13, 2005 by the Borrower to CIBC Mellon Trust Company, as Collateral Agent

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19. $3,000,000,000 Demand Debenture granted as of October 13, 2005 by the Borrower to CIBC Mellon Trust Company, as Collateral Agent, with respect to 0000 Xxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx Xxxxxxxx

20. $3,000,000,000 Demand Debenture granted as of October 13, 2005 by the Borrower to CIBC Mellon Trust Company, as Collateral Agent, with respect to 000 00xx Xxxxxx XX, Xxxxxxx, Xxxxxxx

21. $3,000,000,000 Demand Debenture granted as of October 13, 2005 by the Borrower to CIBC Mellon Trust Company, as Collateral Agent, with respect to 0000 Xxxxxx Xxx XX, Xxxxxxxx, Xxxxxxx

22. $3,000,000,000 Demand Debenture granted as of October 13, 2005 by the Borrower to CIBC Mellon Trust Company, as Collateral Agent, with respect to 00 Xxxxxx Xxxxxx Xxxx, Xxxxxxx, Xxxxxxx

23. Confirmation Agreement entered into by, inter alia, the Borrower and Canwest Television GP Inc. dated as of December 22, 2008

24. Confirmation and Agreement entered into by, inter alia, the Borrower, Canwest Television GP Inc. and Canwest Television Limited Partnership dated as of January 1, 2009

U.S. Security Documentation

1. Amended and Restated U.S. Security and Pledge Agreement dated as of August 29, 2008 made by the U.S. Guarantors

Ireland Security Documentation

1. ULC Share Charge entered into by, inter alia, the Borrower and CanWest Ireland Nominee Limited dated as of October 13, 2005

2. Composite Share Charge entered into by, inter alia, the Borrower dated as of October 13, 2005

3. Composite Debenture entered into by, inter alia, the Ireland Guarantors dated as of October 13, 0000

Xxxxxxxxxxx Security

1. Deed of Pledge of Movable Assets, Receivables and Intellectual Property Rights dated as of October 12, 2005 made by each of the Netherlands Guarantors

2. Deed of Pledge of Shares dated as of October 12, 2005 made by CGS International Holdings (Netherlands) B.V.

12298241.7

Australian Security

1. Equitable Mortgage of Securities entered into by, inter alia, CanWest MediaWorks Ireland Holdings dated as of August 28, 2007

2. Participant Sponsorship Agreement entered into by, inter alia, CanWest MediaWorks Ireland Holdings dated as of August 28, 2007

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SCHEDULE 4.1(j)

GUARANTORS

Canadian Guarantors

1. Canwest Global Communications Corp.

2. National Post Holdings Ltd.

3. Multisound Publishers Ltd.

4. Western Communications Inc.

5. ONtv Holdings Inc.

6. BCTV Holdings Inc.

7. CHEK Holdings Inc.

8. CHBC Holdings Inc.

9. 3919056 Canada Ltd.

10. Fox Sports World Canada Holdco Inc.

11. MBS Productions Inc.

12. Global Centre Inc.

13. Yellow Card Productions Inc.

14. Fox Sports World Canada Partnership, by its partners Fox Sports World Canada Holdco Inc. and Canwest Television Limited Partnership.

15. The National Post Company/La Publication National Post, by its partners Canwest Media Inc. and National Post Holdings Ltd.

16. Canwest Television Limited Partnership, by its general partner Canwest Television GP Inc.

17. Canwest Television GP Inc.

18. 4501063 Canada Inc.

19. 4501071 Canada Inc.

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Quebec Guarantors

1. Canwest Global Broadcasting Inc./Radiodiffusion Canwest Global Inc.

2. Canwest Finance Inc./Financiere Canwest Inc.

Barbados Guarantors

1. CanWest International Communications Inc.

2. CanWest Irish Holdings (Barbados) Inc.

3. CanWest International Management Inc.

Ireland Guarantors

1. CanWest International Distribution Limited

2. Canwest MediaWorks Ireland Holdings

3. CanWest Ireland Nominee Limited

Netherlands Guarantors

1. CGS Debenture Holding (Netherlands) B.V.

2. CGS International Holdings (Netherlands) B.V.

3. CGS Shareholding (Netherlands) B.V.

4. CGS NZ Radio Shareholding (Netherlands) B.V.

5. Canwest MediaWorks Turkish Holdings (Netherlands) B.V.

U.S. Guarantors

1. Canwest MediaWorks (US) Holdings Corp.

2. 30109, LLC

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SCHEDULE 5.12

POST CLOSING UNDERTAKINGS

1. Deliver to Agent, by the earlier of the Restructuring Event Date and the date which is 45 days after the Effective Date, evidence satisfactory to Agent that mortgages (or comparable real property or immoveable property charging documents) have been executed and registered in favour of the Collateral Agent against the properties identified as “Additional Secured Properties” in the first page of Schedule 3.28.

2. Within 10 days after the Effective Date, the establishment of all accounts with The Bank of Nova Scotia contemplated by Section 6 of the Blocked Account Agreement (and referred to in Schedule A thereof) in a manner which permits the daily sweeping of cash receipts to the Agent in accordance with the Blocked Account Agreement.

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SCHEDULE 6.1

EXISTING INDEBTEDNESS

(See Attached)

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SCHEDULE 6.9

RESTRICTIVE AGREEMENTS

2. Note Purchase Agreement as between, inter alia, Canwest Media Inc. and Canwest Television Limited Partnership as issuers, and CIBC Mellon Trust Company as collateral agent, dated 20 May, 2009.

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SCHEDULE 7.1(d)

MILESTONES

1. On or before June 15, 2009, the Borrower shall have sold or otherwise disposed of the Turkish Assets for, and received net proceeds of, not less than $13,000,000; provided that the Borrower shall not be considered to be in default of this milestone if, on or before June 15, 2009, the Borrower shall have received the net proceeds of not less than $13,000,000 of additional Indebtedness provided by some or all of the New Noteholders on terms and conditions which are substantially identical to the terms and conditions which apply to the New Notes.

2. On or before July 15, 2009, the Borrower shall have received a financing commitment, duly executed and delivered, satisfactory to the Agent in its sole discretion, in an amount sufficient to enable the Borrower to make an indefeasible permanent repayment in full of all Obligations and to enable the Borrower to cancel the Commitments upon the funding thereof;

3. On or before June 15, 2009, the Borrower shall have reached an agreement in principle in respect of a restructuring transaction as outlined in a term sheet, duly executed and delivered, with the ad hoc committee of holders of not less than 66-2/3 % in aggregate principal amount of outstanding Senior Subordinated Notes stakeholders; provided that, if the New Noteholders extend the same milestone date in the Note Purchase Agreement (without the payment of any extension fee or other form of consideration for such extension), then the June 15, 2009 milestone date contemplated by this paragraph 3 shall be automatically extended to the date to which the same milestone date in the Note Purchase Agreement has been extended (so long as such extended date is not later than June 30, 2009).

4. On or before June 15, 2009, the Borrower shall have initiated discussions with the Canadian Radio-television and Telecommunications Commission with respect to the restructuring transaction.

5. On or before July 15, 2009, the Borrower shall have executed a definitive arrangement agreement in respect of a restructuring transaction.

6. On or before August 31, 2009, the Borrower shall have obtained approval of a plan of arrangement approved by the Agent (the “Plan of Arrangement”) from all of its requisite stakeholders.

7. On or before October 15, 2009, the Borrower shall have received all requisite regulatory approvals for the Plan of Arrangement.

8. On or before October 31, 2009, all amounts owing under the Credit shall have been indefeasibly permanently repaid in full.

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EXHIBIT A

FORM OF BORROWING BASE REPORT

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EXHIBIT B

FORM OF NOTICE OF BORROWING

(Letter to be typed on Borrower's Letterhead)

[DATE]

CIT BUSINESS CREDIT CANADA INC.

000 Xxxxxx Xxxx Xxxx, Xxxxx 000

Xxxxxxx, Xxxxxxx, X0X 0X0

Attention: Collateral Analyst

FAX: (000) 000-0000

BORROWING NOTICE

Gentlemen:

We refer to the credit agreement dated as of [DATE] (as amended, restated, supplemented, replaced or otherwise modified from time to time the “Credit Agreement”; capitalized terms used herein but not otherwise defined shall have the meanings set forth in the Credit Agreement), between Canwest Media Inc., as borrower (the “Borrower”) and CIT Business Credit Canada Inc., as agent (the “Agent”).

We hereby instruct and authorize the Agent to make advances to our disbursement account(s), subject to and in accordance with the terms and provisions of the Credit Agreement to the account numbers specified below and to charge the Borrower’s loan account as Revolving Loans with each such advance(s).

The Borrower hereby requests an advance (the “Advance”) be made under the Revolving Credit Facility as follows:

A. the Borrowing Amount :

Prime Rate Loan (Cdn$):	_______________
Base Rate Loan (US$)	_______________
Letter of Credit/Credit Support*:	_______________
Additional Information:	As per the attached Letter of Credit application

* Attach a copy of the Letter of Credit application duly completed by the Borrower in accordance with the provisions of the Credit Agreement.

B. the Drawdown Date: _[DATE]__________

Proceeds of the Advance are to be directed as follows:

Bank Name:	_________________
Account Name:	_________________
Branch #:	_________________
Account Number:	CAD#____________
	USD#____________

The Borrower hereby acknowledges that the Agent will make payments strictly on the basis of the account number furnished herein even if such account number identifies a party other than the name of the account listed above. In the event the above account number is incorrect, we hereby agree to be fully liable for any and all losses, costs, and expenses arising therefrom.

The Borrower hereby confirms as follows:

(a)	Each of the representations and warranties made by the Borrower in or pursuant to the Credit Agreement and the other Loan Documents are true and correct on and as of the date hereof as if made on and as of the date hereof, except where such representation and warranty refers to a different date.

(b)	No Default or Event of Default has occurred and is continuing on the date hereof or will occur after the making of the Advance(s) requested hereunder.

(c)

Except as may have been otherwise agreed to from time to time by the Agent and the Borrower in writing, after making the Advance(s) requested to be made by the Borrower hereunder, the aggregate Exposure will not exceed the lesser of (i) the Commitments, and (ii) an amount equal to the Borrowing Base.

DATED this day of _____ , 200

Yours truly,

Company

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EXHIBIT C

[INTENTIONALLY DELETED]

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EXHIBIT D

FORM OF LEGAL OPINION

TO BE DELIVERED SEPARATELY AT CLOSING

12298241.7

EXHIBIT G

FORM OF LANDLORD WAIVER

The undersigned is the owner of the premises known as (the “Premises”), which Premises are leased by the undersigned to [NAME OF CREDIT PARTY], a [JURISDICTION] corporation, or one of its affiliates (collectively, the “Obligors”) pursuant to a lease agreement dated as of _________________________________ (as it may be amended, restated, supplemented, replaced or otherwise modified from time to time, the “Lease”). The undersigned understands that the Obligors will enter (or have entered) into a credit facility with CIT Business Credit Canada Inc., in its capacity as Agent (the “Agent”) for certain lenders (the “Lenders”), pursuant to which (a) the Lenders may make loans to certain of the Obligors from time to time, and (b) the Obligors will grant (or have granted) to a collateral agent (the “Collateral Agent”) for the benefit of certain creditors (including the Agent), a security interest on all of the Obligors' present and after-acquired assets (collectively, the “Collateral”).

1. The undersigned hereby waives and relinquishes in favour of the Agent any landlord's lien, all rights of levy or distraint, security interest or other interest that the undersigned may now or hereafter have, whether by statute, contract (including the Lease) or by common law, in any of the Collateral (the “Landlord's Liens”), whether for rent or otherwise, and agrees that the Collateral Agent's security interests and liens in the Collateral, now existing or hereafter arising, shall have priority over and rank senior to any and all of the Landlord’s Liens. The undersigned disclaims any interest in the Collateral and agrees not to assert any claim to the Collateral while the Obligors are indebted to the Lenders.

2. In order to exercise any rights as a secured party holding a security interest in the Collateral, the Collateral Agent is expressly authorized and privileged at any time to enter the Premises and inspect, remove or repossess the Collateral and may advertise and conduct a public auction or private sale of the Collateral; provided, however, that the Collateral Agent will repair, or pay the reasonable cost to repair, any injury to the realty resulting from such inspection, removal, repossession, auction or sale.

3. If the Lease is terminated by the undersigned whether by reason of any default by the Obligors or otherwise, or if the Obligors default under any of their agreements with the Agent or any Lender, and in any such case the Collateral Agent, on behalf of itself or the Lenders, desires to exercise its rights as a secured party holding a security interest in any of the Collateral, then the Collateral Agent may thereafter at its option occupy the Premises for up to 90 days and may keep thereon such property as it determines appropriate, provided that the Collateral Agent shall pay rent for its period of occupancy (pro-rated on a daily basis and computed on the basis of a 30-day month) at the rate provided in the Lease based on the rate in

12298241.7

effect just prior to such termination or default, without incurring any other obligations of the Obligors.

4. The undersigned hereby consents to the acquisition by the Collateral Agent, at the Collateral Agent’s option, of the absolute ownership of the Obligors' interest in the Lease and agrees that if the Collateral Agent, at its option, takes possession of the Obligors’ leasehold estate in the Premises, the Collateral Agent will thereupon, be recognized as the tenant under the Lease. If the Collateral Agent shall become the tenant under the Lease, it may, on behalf of the Lenders, sublease or assign the Lease for any lawful purpose with the express written consent of the undersigned and the assignment of the Lease shall release and relieve the Collateral Agent of all obligations thereunder. The undersigned agrees to give notice within 5 days of any default by any Obligor of any of the provisions of the Lease, such notice to be provided to:

CIT Business Credit Canada Inc.

000 Xxxxxx Xxxx Xxxx, Xxxxx 000

Xxxxxxx, Xxxxxxx

X0X 0X0

Attn: Chief Credit Officer

5. All of the rights and privileges of the Agent and the Collateral Agent hereunder shall inure to the benefit of its successors and assigns and shall bind the undersigned's successors or assigns.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this _____ day of _________________, 200 .

[NAME OF LANDLORD]

By:

Name:

Title:

12298241.7

EXHIBIT H

FORM OF BAILEE LETTER

___________ ____, 200

[NAME OF BAILEE]

[ADDRESS OF BAILEE]

_______________________

Re: [NAME OF CREDIT PARTY] (the “Xxxxxx”)

Ladies and Gentlemen:

This letter (the “Letter”) is to advise _________________ (the “Bailee”) that the Xxxxxx executed and delivered to CIT Business Credit Canada Inc., in its capacity as Agent for certain lenders (the “Agent”) a Credit Agreement (as may be modified, amended, renewed, extended, restated, or replaced from time to time, the “Credit Agreement”), pursuant to which the Xxxxxx granted to the Agent a security interest in, among other things, all inventory of the Xxxxxx, some of which is in possession of the Bailee from time to time (the “Controlled Inventory”). By executing this Letter, the Bailee acknowledges that from time to time the Bailee is in possession of Controlled Inventory and that, because of the Agent’s interest in the Controlled Inventory, the instructions contained in this Letter are irrevocable and cannot be altered or amended without the prior written consent of the Agent. The Xxxxxx’x execution of this Letter is conclusive evidence to the Bailee of its confirmation of and agreement to the foregoing and of its agreement to be bound by all terms of this Letter on which the Bailee is entitled to rely for all purposes until written notice of termination of this Letter is given to the Bailee by the Agent.

The Bailee recognizes the Agent’s continuing security interest in the Controlled Inventory and in the proceeds thereof. The Bailee covenants and agrees that the Controlled Inventory is and shall remain owned by the Xxxxxx, and that the Agent may at any time and from time to time inspect, remove and/or repossess the Controlled Inventory while in possession of the Bailee without accountability to the Bailee therefor and free of any lien, security interest, right or claim which the Bailee may now or hereafter have, such right of the Agent being independent of any other right or remedy the Agent may have. The Bailee hereby authorizes and empowers the Agent to access the premises where the Controlled Inventory is located for the purposes of guarding and maintaining the Controlled Inventory, preparing and showing the same for sale and/or conducting a sale thereof. The Bailee hereby waives and releases, for the benefit of the Agent, its successors and assigns, any and all liens, security interests, rights and claims of every kind, whether statutory, contractual or by law, which the Bailee may now or hereafter have with respect to the Controlled Inventory, including, without limitation, any rights to seize, hold,

12298241.7

restrain, levy upon, take possession of, sell or otherwise transfer or dispose of the Controlled Inventory and the Bailee further acknowledges and agrees that no negotiable warehouse receipts or documents of title will be issued covering the Controlled Inventory.

So long as no Default Period (hereinafter defined) is continuing, the Xxxxxx may control the Controlled Inventory. From the date on which the Agent notifies the Bailee that an “Event of Default” (as defined in the Credit Agreement) has occurred and thereafter until the Bailee receives notice from the Agent that such Event of Default is no longer continuing and that no other Event of Default is continuing (such period being referred to herein as a “Default Period”), the Bailee, the Xxxxxx and the Agent agree that the Agent shall have the exclusive right to direct the Bailee as to control of the Controlled Inventory, which includes, without limitation, the right to dispose of, repossess or remove the Controlled Inventory, and the Bailee shall not comply in any respect with any request or direction by the Xxxxxx in connection with the Controlled Inventory, unless consented to in writing by the Agent.

At any time when the Bailee has possession of the Controlled Inventory, the Bailee agrees to prevent the commingling of the Controlled Inventory in its possession with other Inventory, goods or items in the Bailee’s possession by clearly separating, dividing or otherwise isolating the Controlled Inventory from all such other items in the Bailee’s possession. The Bailee will also clearly identify the Controlled Inventory as belonging to the Xxxxxx, through the use of labels, tags, or other similar coding methods.

The Bailee will from time to time deliver to the Agent, upon the written request of the Agent (which request may be by facsimile transmission) and at the Xxxxxx’x cost and expense, such information regarding the Controlled Inventory as may be reasonably requested by the Agent, and the Bailee will notify the Agent promptly if the Bailee acquires knowledge that the Controlled Inventory shall become subject to any injunction, writ or warrant of attachment or garnishment, judgment, levy and execution, or similar process. The Bailee confirms in favour of the Agent that it has not, prior to the date hereof, executed in favour of any third party any document, instrument or agreement pursuant to which (a) the Bailee has acknowledged a security interest in the Controlled Inventory in favour of such third party, or (b) the Bailee has agreed to follow the instructions of such third party in respect of the Controlled Inventory.

The Xxxxxx agrees that the Bailee shall be fully protected in acting on any notice or direction by the Agent relating to the Controlled Inventory without making any inquiry whatsoever as to the Agent’s right or authority to give such notice or direction. Further, the Bailee shall have no liabilities to the Xxxxxx or the Agent other than those imposed upon it by law for its own lack of good faith, gross negligence or willful misconduct. The Bailee shall not be liable for consequential, indirect or special damages, even if the Bailee has been advised of the possibility of such damages. The Bailee shall not be liable for any failure or delay in performing any service under this Letter in the event and to the extent that such failure arises out of causes beyond the Bailee’s control, including but not limited to war, civil commotion, an Act of God, fire, flood, explosion, sabotage, failure or interruption of electrical or other power supplies or of transportation services, compliance with governmental laws, regulations or orders, and strikes and lockouts.

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The Xxxxxx agrees to pay the Bailee’s costs and expenses, including reasonable legal fees, in connection with the execution, delivery and administration of this Letter.

The Xxxxxx and the Agent, jointly and severally, hereby agree to indemnify and save the Bailee harmless from and against any and all losses, costs and expenses arising out of the compliance by the Bailee with the terms of the instructions contained herein.

If the Xxxxxx is unable to fulfill its obligations to the Bailee in respect of warehouse fees and other expenses payable by the Xxxxxx to the Bailee in connection with the storage, handling and delivery of the Controlled Inventory (collectively, the “Storage Fees”), the Agent agrees that, as a condition to the Agent’s rights of access to the Controlled Inventory and the Agent’s rights of inspection, removal and/or repossession of the Controlled Inventory provided for in this Letter, it will pay to the Bailee all Storage Fees which remain unpaid as at the commencement of any Default Period together with any Storage Fees incurred during the continuance of a Default Period.

The Xxxxxx acknowledges and agrees that (a) any amounts paid by the Agent to the Bailee hereunder shall constitute “Obligations” of the Xxxxxx for purposes of the Credit Agreement, and (b) that this Letter is a “Loan Document” as such term is defined in the Credit Agreement dated ______________________ between the Agent and the Xxxxxx, as borrower.

This Letter may only be terminated by the Agent upon written notice to the Bailee.

This Letter may be execute in one or more counterparts by facsimile transmission, each of which shall be deemed to be an original and all of which, when taken together, shall constitute one and the same agreement.

If the foregoing instructions, terms and agreements are acceptable to the Bailee, please indicate the Bailee’s acceptance by signing this letter in the space provided below and returning it to the Xxxxxx.

Sincerely,

[NAME OF CREDIT PARTY]

By: ___________________________________

Name:

Title:

12298241.7

AGREED AND ACCEPTED:

CIT BUSINESS CREDIT CANADA INC.	Address for Notice:



By: ___________________________	000 Xxxxxx Xxxx Xxxx, Xxxxx 000
Name:	Xxxxxxx, Xxxxxxx
	X0X 0X0
Title:	Attention: Chief Credit Officer

[BAILEE]

By: ___________________________

Name:

Title:

12298241.7

EXHIBIT I

FORM OF ASSIGNMENT AND ASSUMPTION

Dated: _______________, 20___

Reference is made to the credit agreement dated ·, 2009 (as amended, modified, supplemented and in effect from time to time, the “Credit Agreement”), among Canwest Media Inc. (the “Borrower”), the Lenders named therein, and CIT Business Credit Canada Inc., as Agent (the “Agent”). Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Credit Agreement.

This Assignment and Transfer Agreement (the “Assignment and Transfer Agreement”), between [Insert Name of Assignor] (herein the “Assignor”, as further defined and set forth on Schedule 1 hereto and made a part hereof) and [Insert Name of Assignee] (herein the “Assignee”, as further defined and set forth on Schedule 1 hereto and made a part hereof) is dated as of Effective Date (as set forth on Schedule 1 hereto and made a part hereof).

1. The Assignor hereby irrevocably sells and assigns to the Assignee without recourse to the Assignor (subject to Section 2 hereof), and the Assignee hereby irrevocably purchases and assumes from the Assignor without recourse to the Assignor (subject to Section 2 hereof), as of the Effective Date, an undivided interest (the “Assigned Interest”) in and to all the Assignor’s rights and obligations under the Credit Agreement, and only the financing facility contained in the Credit Agreement as is set forth on Schedule 1 (the “Assigned Facility”), in a principal amount for such Assigned Facility as set forth on Schedule 1, and all right, title and interest of the Assignor in and to the Loan Documents relating thereto.

2. The Assignor (i) represents and warrants that it is legally authorized to enter into this Assignment and Transfer Agreement, (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Credit Agreement or any other instrument, document or agreement executed in conjunction therewith (collectively the “Ancillary Documents”) or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement, any Collateral thereunder or any of the Ancillary Documents furnished pursuant thereto, other than that it is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any adverse claim and (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower or any guarantor or the performance or observance by the Borrower or any guarantor of any of its respective obligations under the Credit Agreement or any of the Ancillary Documents furnished pursuant thereto.

3. The Assignee (i) represents and warrants that it is legally authorized to enter into this Assignment and Transfer Agreement; (ii) confirms that it has received a copy of the Credit Agreement, together with the copies of the most recent financial statements of the Borrower, and such other documents and information as it has deemed appropriate to make its own credit analysis; (iii) agrees that it will, independently and without reliance upon the Agent, the Assignor

12298241.7

or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iv) appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement as are delegated to the Agent by the terms thereof, together with such powers as are reasonably incidental thereto; and (v) agrees that it will be bound by the provisions of the Credit Agreement and will perform in accordance with its terms all the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender.

4. Following the execution of this Assignment and Transfer Agreement, such agreement will be delivered to the Agent for acceptance by it and the Borrower, effective as of the Effective Date.

5. Upon such acceptance, from and after the Effective Date, the Agent shall make all payments in respect of the assigned interest (including payments of principal, interest, fees and other amounts) to the Assignee, whether such amounts have accrued prior to the Effective Date or accrue subsequent to the Effective Date; provided, however, that in respect of the Letter of Credit Fee, the Assignee acknowledges and agrees that such fee shall be shared on a pro rata basis. The Assignor and Assignee shall make all appropriate adjustments in payments for periods prior to the Effective Date made by the Agent or with respect to the making of this assignment directly between themselves.

6. From and after the Effective Date, (i) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Transfer Agreement, have the rights and obligations of a Lender thereunder, and (ii) the Assignor shall, to the extent provided in this Assignment and Transfer Agreement, relinquish its rights and be released from its obligations under the Credit Agreement.

7. This Assignment and Transfer Agreement shall be governed by, and construed in accordance with, the laws of the Province of Ontario and the laws of Canada applicable therein.

8. This Assignment and Transfer Agreement may be executed in one or more counterparts by facsimile transmission, each of which shall be deemed to be an original and all of which, when taken together, shall constitute one and the same agreement.

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IN WITNESS WHEREOF, the parties hereto have caused this Assignment and Transfer Agreement to be executed by their respective duly authorized officers.

Accepted1:

CIT BUSINESS CREDIT CANADA INC. ,

As Lender and Agent for the Lenders:

By: ___________________________

Title: ___________________________

By: ___________________________

Title: ___________________________

[NAME OF ASSIGNEE],

As Assignee

By: ___________________________

Title: ___________________________

By: ___________________________

Title: ___________________________

1 To be added only if the consent of the Agent is required by the terms of the Credit Agreement.

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[NAME OF ASSIGNOR]

As Assignee

By: ___________________________

Title: ___________________________

By: ___________________________

Title: ___________________________

Consented to2:

[BORROWER]

By: ___________________________

Title: ___________________________

2 To be added only if the consent of the Borrower and/or other parties (e.g. Swingline Lender, Issuing Bank) is required by the terms of the Credit Agreement.

12298241.7

Schedule 1 to Assignment and Transfer Agreement

Name of Assignor: ·

Name of Assignee: ·

Effective Date of Assignment: ____________________, 200

Assigned Facility	Principal Amount Assigned	Percentage Assigned of Facility (Shown as a percentage of aggregate original principal amount of all Lenders)
Revolving Loans	$·	·%
Total:	$·

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EXHIBIT J

FORM OF REPAYMENT NOTICE

(Letter to be typed on Borrower's Letterhead)

CIT BUSINESS CREDIT CANADA INC., , 200

000 Xxxxxx Xxxx Xxxx, Xxxxx 000

Xxxxxxx, Xxxxxxx, X0X 0X0

Attention:

REPAYMENT NOTICE

Ladies/Gentlemen:

We refer to the Credit agreement dated ___________ (the "Credit Agreement"; capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement), between [Borrower] (the “Company”), CIT Business Credit Canada Inc., as agent (the “Agent”), and the Lenders party thereto (as “Lenders”).

We hereby notify the Agent of our repayment of the Revolving Loans (as defined in the Credit Agreement), subject to and in accordance with the terms and provisions of the Credit Agreement in the amount of:

A. The repayment amount:

Canadian Prime Rate Loan: CAD$___________

Base Rate Loan: US$_________

B. The date of repayment*: ________________

*If notice is received prior to 12:00 noon (Toronto time) on repayment date, otherwise the date of repayment will be the following business day.

Proceeds of the repayment are to be deposited to the account of CIT Business Credit Canada Inc. as follows:

Bank Name:	CIBC, Xxxx Xxxxxx Xxxxxxxx Xxxxx, Xxxxxxx, XX
Account Name:	CIT Business Credit Canada Inc.
Transit #:	00000
Account Number:	CAD 23-78914 USD 03-27700

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The herein mentioned repayment does not constitute, nor shall it be construed as, a termination or partial termination of the Credit Agreement or the Credit.

Yours truly,

By: By:

Name: Name:

Title: Title:

[NAME OF ASSIGNOR]

As Assignee

By: ___________________________

Title: ___________________________

By: ___________________________

Title: ___________________________

Consented to2:

[BORROWER]

By: ___________________________

Title: ___________________________

2 To be added only if the consent of the Borrower and/or other parties (e.g. Swingline Lender, Issuing Bank) is required by the terms of the Credit Agreement.

12298241.7

EXHIBIT K

FORM OF RESPONSIBLE OFFICER’S CERTIFICATE

TO:	CIT Business Credit Canada Inc., as Agent

The undersigned, ____________________ [TITLE of AUTHORIZED SIGNING OFFICER], of ● (the “Borrower”), pursuant to Section 5.1 of the credit agreement dated as of ●, 200 , between, amongst others, CIT Business Credit Canada Inc., as Agent, and the Borrower (as amended, restated, supplemented, replaced or otherwise modified from time to time the “Credit Agreement”), DOES HEREBY CERTIFY in [his/her] capacity as an authorized signing officer of the Borrower and not in [his/her] personal capacity that:

1. The financial statements attached hereto fairly and accurately represent the Borrower’s financial condition at the end of the particular accounting period set out in such financial statements, as well as the Borrower’s and its Subsidiaries’ operating results during such accounting period, subject to year-end audit adjustments;

2. A review of such financial statements and of the activities of the Borrower and its Subsidiaries during the period covered by such financial statements has been made under my supervision has been made with a view to determining whether the Borrower and the Subsidiaries have fulfilled all of their obligations;

3. During the accounting period set out in such financial statements:

(a) each of the Borrower and the Guarantors have fulfilled each of its respective obligations under each of the Loan Documents to which it is a party;

(b) there has been no Default or Event of Default under the Credit Agreement,

(c) the Borrower is not aware of any event or circumstance which could reasonably have or could reasonably have had a Material Adverse Effect (as such term is defined in the Credit Agreement);

(d) the representation and warranties contained in the Credit Agreement and the other Loan Documents are correct in all material respects on and as of the date hereof as though made on and as of such date, other than any such representation or warranty which relates to a specified prior date and except to the extent that the Agent has been notified in writing by the Borrower that any representation or warranty is not correct and the Lenders have explicitly waived in writing compliance with such representation or warranty;

(e) the Borrower has been in full compliance with all covenants set out in the Credit Agreement;

(f) Annex B hereto sets out all Subsidiaries and indicates, for each such Subsidiary, the date of the formation or acquisition of each Subsidiary which was formed or acquired since the end of

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the previous calendar month [Note to Draft: - alternatively, specify that there have been no changes];

(g) no change in GAAP or in the application thereof has occurred since the date of the most recent audited annual financial statements of the Borrower delivered to the Agent [Note to Draft: - If a change has occurred, specify the details of the change and its effect on the accompanying financial statements].

4. Capitalized terms used herein and not otherwise defined shall have the meanings given to such terms in the Credit Agreement.

IN WITNESS WHEREOF, the undersigned has executed this Responsible Officer’s certificate on behalf of the Borrower as of the _______ day of ________________ , 200 .

By:

Name:

Title:

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	TABLE OF CONTENTS

		Page


ARTICLE 1	DEFINITIONS	1
1.1	Defined Terms	1
1.2	Classification of Loans and Borrowings	25
1.3	Terms Generally	25
1.4	Accounting Terms; GAAP	25
1.5	Time	26
1.6	Permitted Liens	26
1.7	Interpretation Clause (Québec)	26
ARTICLE 2	THE CREDITS	27
2.1	Commitments	27
2.2	Loans and Borrowings	27
2.3	Requests for Borrowings	27
2.4	Funding of Borrowings	28
2.5	Interest	30
2.6	Termination and Reduction of Commitments	31
2.7	Repayment of Loans	31
2.8	Evidence of Debt	31
2.9	Prepayments	32
2.10	Fees	33
2.11	[Intentionally Deleted.]	34
2.12	Increased Costs; Illegality; Alternate Rate of Interest	34
2.13	[Intentionally Deleted.]	36
2.14	Taxes	36
2.15	Payments Generally; Pro Rata Treatment; Sharing of Set-offs	37
2.16	Currency Indemnity	39
2.17	Collection of Accounts	39
2.18	Letters of Credit	41
2.19	Conversion to DIP Facility	43
2.20	Priorities	44
ARTICLE 3	REPRESENTATIONS AND WARRANTIES	44

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	TABLE OF CONTENTS
	(continued)
		Page


3.1	Organization; Powers	44
3.2	Authorization; Enforceability	44
3.3	Governmental Approvals; No Conflicts	45
3.4	Financial Condition; No Material Adverse Effect	45
3.5	Litigation	45
3.6	Compliance with Applicable Laws and Agreements	46
3.7	Professional Retainers	46
3.8	Taxes	46
3.9	Titles to Real Property	46
3.10	Titles to Personal Property	46
3.11	Pension Plans	46
3.12	Disclosure	47
3.13	Defaults	48
3.14	Casualties; Taking of Properties	48
3.15	Subsidiaries	48
3.16	Insurance	49
3.17	Management Payments	49
3.18	Material Contracts	49
3.19	Environmental Matters	49
3.20	Employee Matters	50
3.21	Fiscal Year	51
3.22	Intellectual Property Rights	51
3.23	Residency of Borrower for Tax Purposes	52
3.24	Restricted Payments	52
3.25	Debt	52
3.26	Workers’ Compensation	52
3.27	Bank Accounts; Securities Accounts; Futures Accounts	52
3.28	Real Property and Leases	52
3.29	Further Real Property Matters	52

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	TABLE OF CONTENTS
	(continued)
		Page


3.30	Priorities; Jurisdictions of Credit Parties; List of Security Documents; Broadcast Permits	53
ARTICLE 4	CONDITIONS	53
4.1	Effective Date	53
4.2	Restructuring Event Date Conditions	57
4.3	Each Credit Event	57
ARTICLE 5	AFFIRMATIVE COVENANTS	58
5.1	Financial Statements and Other Information	58
5.2	Existence; Conduct of Business	63
5.3	Payment of Obligations	63
5.4	Maintenance of Properties	63
5.5	Books and Records; Inspection Rights	64
5.6	Compliance with Applicable Laws and Material Contracts	64
5.8	Further Assurances	64
5.9	Insurance	64
5.10	Operation and Maintenance of Property	65
5.11	Additional Subsidiaries; Additional Liens	65
5.12	Post Closing Undertakings	66
5.13	Environmental Laws	66
5.14	Chief Restructuring Officer	67
ARTICLE 6	NEGATIVE COVENANTS	67
6.1	Indebtedness	67
6.2	Liens	68
6.3	Fundamental Changes; Asset Sales	68
6.4	Investments, Loans, Advances, Guarantees and Acquisitions	68
6.5	Swap Transactions	69
6.6	Restricted Payments	69
6.7	Use of Proceeds	69
6.8	Transactions with Affiliates	69
6.9	Repayment of Debt	70

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	TABLE OF CONTENTS
	(continued)
		Page


6.10	Restrictive Agreements	70
6.11	Capital Lease Obligations	70
6.12	Sales and Leasebacks	70
6.13	Pension Plan Compliance	71
6.14	Sale or Discount of Receivables	71
6.15	Unconditional Purchase Obligations	71
6.16	Capital Expenditures	71
6.17	No Amendments to Material Contracts	71
6.18	Plan of Arrangement	71
6.19	Employee Compensation	71
6.20	Professional Retainers	72
6.21	Maximum Borrowings	72
6.22	Maximum Disbursements	72
6.23	Securities Accounts and Futures Accounts	72
6.24	Aggregate Receipts	72
6.25	Note Maturity Date	72
ARTICLE 7	EVENTS OF DEFAULT	72
7.1	Events of Default	72
7.2	Remedies	76
ARTICLE 8	THE AGENT	78
8.1	Appointment of Agent	78
8.2	Limitation of Duties of Agent	78
8.3	Lack of Reliance on the Agent	78
8.4	Certain Rights of the Agent	79
8.5	Reliance by Agent	79
8.6	Indemnification of Agent	79
8.7	The Agent in its Individual Capacity	79
8.8	May Treat Lender as Owner	80
8.9	Successor Agent	80
8.10	No Independent Legal Action by Lenders	80

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	TABLE OF CONTENTS
	(continued)
		Page


8.11	Notice of Default	81
8.12	Agency for Perfection	81
8.13	Payments by Agent to Lenders	81
8.14	Concerning the Collateral and the Related Loan Documents	82
8.15	Field Audit and Examination Reports; Disclaimer by Lenders	82
8.16	Quebec Security	82
ARTICLE 9	MISCELLANEOUS	83
9.1	Notices	83
9.2	Waivers; Amendments	84
9.3	Expenses; Indemnity; Damage Waiver	86
9.4	Successors and Assigns	88
9.5	Survival	90
9.6	Counterparts; Integration; Effectiveness	90
9.7	Severability	91
9.8	Right of Set-Off	91
9.9	Governing Law; Jurisdiction; Consent to Service of Process	91
9.10	WAIVER OF JURY TRIAL	92
9.11	Headings	92
9.12	Confidentiality	92
9.13	Press Releases and Related Materials	93
9.14	Anti-Money Laundering Legislation	93
9.15	No Strict Construction	94
9.16	Paramountcy	94
9.17	LIMITATION OF LIABILITY	94
9.18	Subordination of Intercompany Indebtedness	94
9.19	Language	95

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Table of Contents

CREDIT AGREEMENT dated as of May 22, 2009 among CANWEST MEDIA INC. as Borrower THE GUARANTORS FROM TIME TO TIME PARTIES HERETO as Guarantors and THE LENDERS FROM TIME TO TIME PARTIES HERETO as Lenders and CIT BUSINESS CREDIT CANADA INC. as Agent

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